Anyone betting that manufacturing will continue to lead the US economic recovery might think twice after reading comments from survey respondents in Dallas Fed’s April Texas manufacturing outlook.
Similar to Philly Fed’s gauge last week, Dallas headline number tanked, to 8.1 from 24.1 in March. The Philly survey’s headline number fell to 18.5 from 43.4 in March, but unlike the Dallas survey, Philly doesn’t include respondent comments in its report.
Down in Texas there’s a fair measure of cautious optimism among survey respondents, and plenty of concern about high costs and soft demand. Here’s one from a plastics and rubber products manufacturer that sounds pretty good:
“We are very encouraged by the breadth of activity with our cross section of customers in the Dallas–Fort Worth area. It is not just a few companies with increased requirements for plastic parts, but pretty much all of our diverse customer base.”
Now here’s one from the other end of the spectrum, a furniture/related product manufacturer: “Our industry has hit another brick wall. Rapidly increasing costs and fuel costs have shocked the consumer away from any nonmandatory spending. They normally adjust, but it may take several months.” Continue reading…
Stocks drift slightly higher, but finish weakly, at session lows, as bids seemed to disappear in the closing minutes. It’s been a strong month for equities, so no surprise to see a little money come off the table near the close.
Sleepy trading overall, with markets seemingly on autopilot as 2010′s conclusion draws near. Financials, utilities, industrials and consumer staples all pull back; energy, materials lead advancing sectors. USD gets hit pretty hard, and Treasurys produce a nice rally following yesterday’s sell-off, 10-yr yield back down to 3.34% after ending yesterday near 3.49%.
DJIA rises 9.84 to 11585.38, closing at its highest level since late August 2008. The average is up more than 5% in December and 11% for the year. Nasdaq Comp adds 4.05 to 2666.93. S&P 500 ends 1.27 higher at 1259.78. The index is up 6.7% this month and nearly 13% for the year.
Weekly jobless claims, December Chicago ISM (formerly PMI) and November pending home sales all due tomorrow. Data hasn’t had a great influence on stocks lately, though, and not much reason for it to draw much reaction tomorrow, either.
The euro earlier slumped to a session low $1.3072 vs US dollar (after earlier rising to $1.3202), continuation of a drop sparked when the Fed announced it will extend existing US dollar swap line facilities with a handful of foreign central banks.
US stocks appear generally oblivious to the develop, which could be chalked up to a simple focus on wrapping up the year’s business, and trying to grind out more gains in thinner, pre-holiday, formulaic and mechanical trading. Slap the blinders on and buy.
The Fed’s swap-line extension is telling — it’s reinforcement that the debt problems in Europe have a certain intractability, a stubbornness that won’t be dissolved by wishful thinking, promises of new “support mechanisms” or kind words from the Chinese. Continue reading…
Stocks jumped out to some decent gains this morning as bulls tried to circle the wagons after last week’s selloff, but more QE2 trade unwinding — evidenced in dollar strength/euro weakness — seemed to be too much of a hurdle to sustain the advance.
Major averages end mixed, with Dow Industrials eking out a single-digit increase after earlier rising almost 90 points. Materials, energy and tech sectors finish as biggest laggards; financials post the best gains, but well below day’s highs.
Treasurys get absolutely hammered (more evidence that some QE2 love has faded), with 10-yr note’s yield rising almost 16 bps to highest level since Aug 5.
DJIA rises 9.39 to 11201.97, and Nasdaq Comp slips 4.39 to 2513.82. S&P 500 ends 1.46 lower at 1197.75.
Earnings reports due tomorrow from Wal-Mart and Home Depot. Oct PPI, industrial production & capacity utilization and homebuilders Nov sentiment report all due in the morning.
Bears are aiming for some follow-through to yesterday’s sell-off in US stock markets. Asian markets fell sharply overnight, with concerns about interest-rate hikes in China being cited as the catalyst, and European markets are edging lower as sovereign debt concerns — particularly in Ireland — continue to fester.
Interesting complexion premarket, with recent correlations — both positive and negative — appearing to loosen a bit . Euro recovering from big drop overnight, USD index softening, oil and gold in retreat (even as
the dollar eases) and Treasurys a shade lower.
Only data on tap is Reuters/Univ of Michigan prelim Nov consumer sentiment gauge, out at 9:55am ET. S&P futures down 9.30; 10-yr note down slightly, yield at 2.66%.
Investors are focused on a couple key influences this morning, namely the G-20 meeting, and Cisco’s weaker-than-expected outlook.
Hope is that cooperation at the G-20 gathering in Seoul can overcome any discord related to currencies, Fed’s QE2 and global trade. As for Cisco, its weaker outlook will weigh on the tech sector, and based on premarket decline, CSCO alone will be a roughly 31-point drag on the DJIA.
US bond market closed in observance of Veterans Day, no data on the calendar. Disney reports quarterly results after the close. Dollar’s stronger, USD index recently up 0.4%; euro strains to hold $1.37 level. S&P futures down 7.60.
Stronger dollar, sliding euro set the stage for an overdue moderate pullback in US stocks. Equity markets have been on a relentless climb for weeks, fueled by prospect of cheap, easy money, so a breather here is well-warranted.
Call it inflation jitters, or concerns about European sovereign debt or even anxiety about demand for US debt, if you’d like. Financials hit hard; materials and consumer discretionary also a focus for sellers. Treasurys also see sharp selloff. Perhaps a hint of doubt about QE’s power to keep pushing up asset prices? Drop in Treasurys and stocks certainly an attention-grabber.
DJIA falls 60.09 to 11346.75, and Nasdaq Comp sheds 17.07 to 2562.98. S&P 500 ends 9.85 lower at 1213.40 amid an uptick in volume.
Weekly jobless claims due tomorrow, with Veterans Day government holiday Thursday (bond market also closed Thu). Sept trade deficit, Oct import prices also due tomorrow.
Some interesting action in financial markets yesterday and today, with the US dollar looking perkier, euro having a harder go of it along with stocks, Treasurys retreating and gold still scorching.
Leaves us wondering just a little if the QE2 trade — buy Treasurys, short dollar, buy stocks and commodities — has reached the saturation point. Heading into the Fed’s expected QE2 announcement, we were thinking that expectations for easing were all priced into stocks, at least, and the eventual announcement would likely get greeted with more sellers than buyers. Wrong, as Dow Industrials ripped more than 200 points higher the next day.
Perhaps that was the final capper on the trade, though, since stocks and the euro haven’t made much headway since, and Treasury yields are probing back to the high end of their recent range. Gold continues to streak higher, but could be driven much more now by those searching for safe, hard assets, rather than as a weak-dollar, long-commodities play. Continue reading…
Nothing to really marvel at this morning, folks, just the same follow-the-euro-like-a-lost-puppy strategy for investors in US stocks that’s been in place for the past six months.
The euro has regained its footing, US dollar weakening again, which of course sets a positive premarket tone for US stocks. European markets posting solid gains, fittingly led by resource-related names. Asian stocks mostly weaker overnight. Sept wholesale trade and inventory data due at 10:00am ET.
USD weakness supporting fresh gains for oil and gold, with the latter up $14 near $1,417/oz. USD index recently down 0.3%. S&P futures up 2.40; 10-yr note higher, yield at 2.55%.
J.P. Morgan reported some strong earnings today. But what this bloggers eye were some of the sub-numbers in the earnings report. The bank booked $1.8 billion in investment banking fees. But don’t be fooled – that wasn’t from big M&A advising. But $429 million was in advisory fees. Instead, that $1.3 billion + remaining fees […]
It doesn’t look like George Zimmer is going to be able to guarantee it, anymore. The founder of Men’s Wearhouse has been fired from his own company, the clothier announced today. Click here to read the announcement. “The Board expects to discuss with Mr. Zimmer the extent, if any, and terms of his ongoing relationship […]