Dow rose 274, but decliners slightly ahead of advancers & NAZ lost 3. The MLP index fell 2+ to the 218s & the REIT index was flattish in the 348s. Junk bond funds did little & Treasuries were sold bringing higher yields. Oil slid back to the 84s & gold declined 4 to 1651.
AMJ (Alerian MLP index tracking fund)
More than ½ of working US adults feel as though they are behind on retirement savings, underscoring the hardships of the inflated economy, according to a recent report from Bankrate. Of
these adults over 1/3 say they feel "significantly behind,"
according to the consumer financial services company's recent report. Industry experts also estimated that this period of hardship won't end anytime soon. Bankrate's
data showed that while 34% of workers are contributing the same amount
to their retirement savings, only a ¼ of workers have been able to
increase their contributions compared to last year. Meanwhile, 16% are contributing less than last year as inflation continues to squeeze worker budgets & outstrip pay gains. Additionally, 24% of workers didn't contribute
to retirement savings over the past 2 years, according to the report. The report showed that workers who are struggling to contribute more
to their retirement accounts "overwhelmingly" blamed inflation,
according to Bankrate Chief Financial Analyst Greg McBride. McBride
noted that with inflation outpacing growth in average hourly earnings,
workers have an even more limited capacity to increase retirement
savings. "Generally speaking, American workers are undersaved for both retirement
and emergencies," McBride said. "An economic downturn
could further dent both of those, with unemployment or income disruption
sapping emergency savings and some workers tapping retirement savings
early due to financial hardship." He noted that this period is "especially damaging" to older workers
who are closer to retirement given the fact that "they don’t have as
much time left in the workforce to rebuild their nest egg." On top of that, McBride cautioned that with high inflation & an expected recession, this particularly difficult time to save for retirement will likely continue until at least 2024.
Nationwide issue becomes big setback for retirement savings
European business activity took another hit in the month of Oct, reporting the steepest output loss since 2013 excluding pandemic lockdowns. Firms have been under pressure due to higher inflation, particularly coming from energy costs & wage pressures. The euro zone's flash composite Purchasing Managers' Index fell to 47.1 in Oct, down from 48.1 in Sep. A reading below 50 represents a contraction in activity. The ECB said in Sep that the 19-member bloc is set to grow 3.1% this year & 0.9% in 2023. The central bank also forecast inflation at 8.1% this year & at 2.3% in 2024. Manufacturing activity led the losses, but services output also dropped for a 3rd consecutive month. In terms of national breakdown, business activity in Germany came in at 44.1, versus 45.7 in the previous month. Over in France, activity stagnated with a reading at 50 from 51.2 in Sep. The situation economically is getting worse quite rapidly. The € lost ground against the $ & the £ today, trading at $0.982 & 0.868 respectively, following the latest PMI data. The € has been under pressure amid a hawkish Federal Reserve & the energy crisis facing the euro zone in the wake of Russia's invasion of Ukraine.
Fears of a severe recession deepen as European business activity slows
Shares of Chinese companies listed in the US dropped sharply today after Beijing tightened Pres Xi Jinping's grip on power, souring investor sentiment for non-state-driven companies. The Invesco Golden Dragon China ETF, which tracks the Nasdaq Goldman Dragon China Index, plunged 20% to hit a new 52-week low. The index holds 65 companies whose common stocks are publicly traded in the US & the majority of whose business is conducted within the People's Republic of China. The moves come after Xi paved the way for an unprecedented 3rd term as leader & packed the Politburo standing committee, the core circle of power in the ruling Communist Party of China, with loyalists. Under Xi"s leadership, China has implemented a raft of policy that has tightened regulation on the tech sector in areas from data protection to governing the way in which algorithms can be used. Meanwhile, Xi has stuck to the strict “zero-Covid” policy which has seen cities, including the mega financial hub of Shanghai, locked down this year, even as most of the world has opened their economies. Hong Kong's Hang Seng index spiraled 6.36% to its lowest levels since 2009. The Shanghai Composite & the Shenzhen Component in mainland China both lost about 2%.
U.S.-listed Chinese stocks drop 20% after Beijing's power reshuffle
Dow Jones Industrials
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