Dow fell 67, decliners over advancers 5-2 & NAZ gave back 10. The MLP index dropped 1+ to 295. Junk bond funds were mixed & Treasuries remained weak. Oil slid back in the 63s & gold was down 8 to 1331 (still at lofty levels).
AMJ (Alerian MLP Index tracking fund)
Stocks retreated after hitting all-time highs yesterday. The yield on 10-year Treasuries briefly climbed above 2.6% for the first time since Mar before falling back, while the $ failed to hold on to the Wed gain. All major equity gauges were down slightly, led by weakness in real estate & household products makers. Meanwhile, the move in Treasuries came amid speculation that Congress will strike a deal to avert a gov shutdown after temporary funding runs out on Jan.19. In addition, investors are guessing that Apple (AAPL), a Dow & NAZ stock, may sell some securities to pay the tax bill it will incur from it’s planned cash repatriation. European stocks pared an earlier advance, struggling to stay in the green as the € shrugged off ECB attempts to talk it down earlier this week. West Texas oil fell on signs US crude stockpiles continued to shrink & base metals advanced following strong Chinese growth data. Elsewhere, gold rose after 2 days of declines
Groundbreaking on new US homes eased from the fastest pace in 13 months while permits held steady to finish the strongest year for housing construction in a decade, gov figures showed. Residential starts fell 8.2% to a 1.19M annualized rate (est 1.28M) after 1.3M pace in prior month; biggest drop in a year. Single-family home starts fell 11.8% to 836K & multifamily rose 1.4% to 356K. Permits, a proxy for future construction of all types of homes, fell 0.1% to 1.302M rate (est 1.295M) from a 1.303M pace. Applications to build single-family homes rose to an 881K annual rate, the fastest in 10 years, from 865K. The decline in starts suggests that the Nov jump in home construction was more of a temporary spike than an increase in the underlying pace of growth. It could also reflect weather effects. At the same time, annual totals for permits, starts & completions were all the highest since 2007. More construction would help ease an inventory crunch that the National Association of Realtors have flagged as an impediment to more sales. The level of permits indicates construction should pick up, putting further pressure on the labor market, where builders are already facing a smaller pool of skilled workers. At the same time, last month's tax-cut legislation that curbed deductions for mortgage interest & property taxes could weigh on housing in some states. The latest results also indicate the contribution of residential construction spending to q4 growth may be smaller than previously anticipated.
U.S. Housing Starts Fall More Than Expected, Permits Steady
US filings for unemployment benefits plummeted to the lowest level in almost 45 years in a sign the job market will tighten further in 2018, according to Labor Dept data. Jobless claims decreased by 41K to 220K (est 249K), lowest level since 1973 & the biggest drop since 2009. Continuing claims rose by 76K to 1.952M in the latest week. The 4-week average of initial claims, a less-volatile measure than the weekly figure, fell to 244K from the prior week's 250K. The drop in claims shows that companies are increasingly holding on to their employees amid a shortage of skilled labor. Businesses are struggling to find workers to fill positions, particularly in manufacturing & construction, as cited in some anecdotes for the Federal Reserve's Beige Book. The figures suggest the unemployment rate of 4.1%, already the lowest since 2000, could be poised to decline further. The latest week for claims includes the 12th of the month, which is the reference period for the Labor Dept's monthly employment surveys. Caveats for the latest numbers include the fact that the week was sandwiched between 2 periods containing holidays, when data tend to be more volatile. In addition, more states than usual had estimated figures.
U.S. Jobless Claims Plunge to Lowest Weekly Tally Since 1973
Today's decline could be expected after the Jan rally. After a stellar year, the Dow is up 1.3K already in 2018. Boeing (BA) led the Dow higher yesterday, but is down 7 today. Daily whims can produce higher volatility. Meanwhile the threat of a gov shutdown highlights dysfunctional DC, making traders more nervous. Economic fundamentals continue to be strong. AAPL is giving workers a $2500 bonus. If the DC guys can figure out how to fund the gov for the rest of the year, the stock rally should remain intact.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CL=F | Crude Oil | 63.83 | -0.14 | -0.2% |
| GC=F | Gold | 1,330.90 | -8.30 | -0.6% |
Stocks retreated after hitting all-time highs yesterday. The yield on 10-year Treasuries briefly climbed above 2.6% for the first time since Mar before falling back, while the $ failed to hold on to the Wed gain. All major equity gauges were down slightly, led by weakness in real estate & household products makers. Meanwhile, the move in Treasuries came amid speculation that Congress will strike a deal to avert a gov shutdown after temporary funding runs out on Jan.19. In addition, investors are guessing that Apple (AAPL), a Dow & NAZ stock, may sell some securities to pay the tax bill it will incur from it’s planned cash repatriation. European stocks pared an earlier advance, struggling to stay in the green as the € shrugged off ECB attempts to talk it down earlier this week. West Texas oil fell on signs US crude stockpiles continued to shrink & base metals advanced following strong Chinese growth data. Elsewhere, gold rose after 2 days of declines
U.S. Stocks Slide Following Wednesday's Records: Markets Wrap
Groundbreaking on new US homes eased from the fastest pace in 13 months while permits held steady to finish the strongest year for housing construction in a decade, gov figures showed. Residential starts fell 8.2% to a 1.19M annualized rate (est 1.28M) after 1.3M pace in prior month; biggest drop in a year. Single-family home starts fell 11.8% to 836K & multifamily rose 1.4% to 356K. Permits, a proxy for future construction of all types of homes, fell 0.1% to 1.302M rate (est 1.295M) from a 1.303M pace. Applications to build single-family homes rose to an 881K annual rate, the fastest in 10 years, from 865K. The decline in starts suggests that the Nov jump in home construction was more of a temporary spike than an increase in the underlying pace of growth. It could also reflect weather effects. At the same time, annual totals for permits, starts & completions were all the highest since 2007. More construction would help ease an inventory crunch that the National Association of Realtors have flagged as an impediment to more sales. The level of permits indicates construction should pick up, putting further pressure on the labor market, where builders are already facing a smaller pool of skilled workers. At the same time, last month's tax-cut legislation that curbed deductions for mortgage interest & property taxes could weigh on housing in some states. The latest results also indicate the contribution of residential construction spending to q4 growth may be smaller than previously anticipated.
U.S. Housing Starts Fall More Than Expected, Permits Steady
US filings for unemployment benefits plummeted to the lowest level in almost 45 years in a sign the job market will tighten further in 2018, according to Labor Dept data. Jobless claims decreased by 41K to 220K (est 249K), lowest level since 1973 & the biggest drop since 2009. Continuing claims rose by 76K to 1.952M in the latest week. The 4-week average of initial claims, a less-volatile measure than the weekly figure, fell to 244K from the prior week's 250K. The drop in claims shows that companies are increasingly holding on to their employees amid a shortage of skilled labor. Businesses are struggling to find workers to fill positions, particularly in manufacturing & construction, as cited in some anecdotes for the Federal Reserve's Beige Book. The figures suggest the unemployment rate of 4.1%, already the lowest since 2000, could be poised to decline further. The latest week for claims includes the 12th of the month, which is the reference period for the Labor Dept's monthly employment surveys. Caveats for the latest numbers include the fact that the week was sandwiched between 2 periods containing holidays, when data tend to be more volatile. In addition, more states than usual had estimated figures.
U.S. Jobless Claims Plunge to Lowest Weekly Tally Since 1973
Today's decline could be expected after the Jan rally. After a stellar year, the Dow is up 1.3K already in 2018. Boeing (BA) led the Dow higher yesterday, but is down 7 today. Daily whims can produce higher volatility. Meanwhile the threat of a gov shutdown highlights dysfunctional DC, making traders more nervous. Economic fundamentals continue to be strong. AAPL is giving workers a $2500 bonus. If the DC guys can figure out how to fund the gov for the rest of the year, the stock rally should remain intact.
Dow Jones Industrials
No comments:
Post a Comment