Financial Review

Links 02-04-2015

Baker Hughes to axe 7,000 jobs   For the consumer, the dollar actually hasn’t been that strong   Slump in Oil Prices Brings Pressure, and Investment Opportunity   General Motors reported a 91% jump in its fourth-quarter profit   Staples has agreed to buy Office Depot for $6.3 billion   Yahoo has decided to spin off   Euro Weakens After ECB Limits Direct Funding for Greek Banks

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Financial Review

Links 02-03-2015

Americans Pose Threat to Power Grid January U.S. Auto Sales Held Strong Greece’s rock-star finance minister Yanis Varoufakis defies ECB’s drachma threats Donations rose in 2014, but this year may be different OIL SPIKES 9%, ENTERS BULL MARKET

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Financial Review

Strange Days in Energy

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-02-03-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW + 305 = 17,666 SPX + 29 = 2050 NAS + 51 = 4727 10 YR YLD + .10 = 1.78% OIL + 2.52 = 52.09 GOLD – 13.70 = 1261.10 SILV + .09 = 17.37 One year ago, the Dow Industrials dropped down to 15,356, which proved to be the low for 2014. Since then, up 16%, mas o menos. Corelogic reports home prices slipped 0.1% in December, to take the year-on-year rate to 5%. Twenty-seven states and the District of Columbia are at or within 10% of their peak; current prices in Arizona are still 29.5% below the peak. Colorado (8.4%), Texas (7.8%) and New York (7.6%) saw the fastest growth, while only three states — Maryland (-0.7%), Vermont (-0.9%) and Connecticut (-2.2%) — saw a decline on a year-on-year basis. New orders for factory-made goods in the U.S. sank 3.4% in December to mark the fifth straight decline. The latest drop suggests that manufacturers may have scaled back production owing to a stronger dollar and weak economic growth overseas that’s made it harder to sell American-made goods. Inventories also declined for the first time in 19 months, down 0.3%. Excluding transportation, new factory orders fell a smaller 2.3%. Earnings reporting season: Chipotle Mexican Grill said its fourth-quarter earnings rose 52% as sales benefited from stronger customer traffic, higher menu prices and new stores. It’s tough …

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Financial Review

Anti-Austerity Gets Wind in Sails

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-02-02-2015.mp3Podcast: Play in new window | Download (Duration: 12:46 — 5.8MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW + 196 = 17,361 SPX + 25 = 2020 NAS + 41 = 4676 10 YR YLD – .01 = 1.67% OIL + 1.59 = 49.83 GOLD – 9.30 = 1274.80 SILV – .05 = 17.28 Americans cut spending in December by the largest amount since 2009; we knew spending on energy would be lower but consumers did not rush out and spend the money. Household savings from lower energy costs, were partly offset in December by higher spending on drugs, health care and housing. These expenses continue to eat up a large portion of American incomes. Incomes posted another solid gain and falling inflation is allowing Americans to get more bang for their buck. Personal spending fell a seasonally adjusted 0.3% last month. Personal income, meanwhile, rose 0.3%. Since income growth outpaced spending, the amount of money individuals save jumped to 4.9% from 4.3% to mark the highest level since midsummer. The Commerce Department reports construction spending rose 0.4% in December to a seasonally adjusted annual rate $982.1 billion, led by public spending. Private-construction spending rose 0.1% in December, with a 0.3% increase for residential projects and a 0.2% decline for nonresidential projects. Meanwhile, public-construction spending rose 1.1% in December. The ISM Manufacturing Report for January dropped from 55.1 to 53.5. Any reading above 50 indicates the manufacturing sector is expanding, just not as fast. Germany’s Angela …

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Financial Review

One Foot on the Gas, One Foot on the Brake

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-01-30-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW – 251 = 17,164 SPX – 26 = 1994 NAS – 48 = 4635 10 YR YLD – .08 = 1.67% OIL + 3.25 = 47.78 GOLD + 25.00 = 1284.10 SILV + .31 = 17.33 GDP growth slows. The Commerce Department reports fourth quarter gross domestic product grew by 2.6%, down from a very strong 5% growth rate in the third quarter. The results were below consensus estimates of 3% growth. For all of 2014, the economy grew 2.4% compared to 2.2% in 2013. Consumer spending advanced at a 4.3% pace in the fourth quarter – the fastest since the first quarter of 2006 and an acceleration from the third quarter’s 3.2% pace. The final read on the University of Michigan’s consumer sentiment index was 98.1, down a tick from the 98.2 in the preliminary estimate. That’s still above the 93.6 mark in December and the best reading in 11 years. Just as consumers were stepping on the gas, businesses were tapping the brakes. Business spending on equipment fell at a 1.9% rate. It was the largest contraction since the second quarter of 2009. The fourth-quarter weakness could reflect cuts or delays to investment projects in the oil industry. But it could also be payback after two back-to-back quarters of robust gains. A wider trade deficit, as slower global growth curbed exports and solid domestic demand sucked …

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Financial Review

Good Luck With That

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-01-29-2015.mp3Podcast: Play in new window | Download (Duration: 13:17 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW + 225 = 17,416 SPX + 19 = 2021 NAS + 45 = 4683 10 YR YLD + .02 = 1.75% OIL + .09 = 44.54 GOLD – 25.20 = 1259.10 SILV – 1.04 = 17.02 Yesterday, the Federal Reserve said it would remain “patient” on raising rates, but indicated it saw the U.S. economy getting stronger. The Fed also said it has seen inflation decline, and it may decline further, but that low oil prices are probably temporary. The FOMC statement said that economic activity has expanded “at a solid pace” and that labor market conditions have improved. That was certainly the case last week. The fewest Americans in almost 15 years filed applications for unemployment benefits during a holiday-shortened week that typically makes the data more volatile. Jobless claims dropped by 43,000 to 265,000 in the week ended Jan. 24, the lowest since April 2000. No state reported an increase of more than 1,000 in claims for the week ended Jan. 17. The National Association of Realtors reports its index of pending home sales fell 3.7% in December, though the year-on-year gain was 11.7%, the highest since June 2013. Pending sales measures contracts signed but not yet closed. The Census Bureau reports the number of owner-occupied households fell by 354,000 from a year earlier as the homeownership rate dropped to its lowest level since 1994. The …

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Financial Review

Fed Patiently Makes Hawkish Sounds

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-01-28-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW – 195 = 17,191 SPX – 27 = 2002 NAS – 43 = 4637 10 YR YLD – .10 = 1.72% OIL – 1.19 = 44.26 GOLD – 8.80 = 1284.30 SILV – .07 = 18.06 Microsoft’s stock logged its biggest one-day dollar decline in nearly 15 years on Tuesday, after the company posted disappointing earnings Monday afternoon. Shares of Microsoft closed down 9.2%, or $4.35, to $42.66 on Tuesday, wiping out $34.7 billion in stock-market value. The Dow Industrials dropped 291 points Tuesday. Then after the close of trade yesterday, Apple posted the largest quarterly net income of any public company in history; $18 billion. That provided an early boost to the markets today; at least until the FOMC statement. The Dow Industrials are down from record highs, but not too bad. Since hitting an intraday high of 18,103 on December 28th, the Dow has been choppy through January; on three occasions dropping down to the 17,200 range but not dropping under (17,262 on January 6th, 17,243 on January 16th, and 17,288 yesterday). These three lows formed a floor, or a level of support for the Dow. Today, the Dow closed at 17,191; we broke support. And the next level of support is 17,067 from mid-December and the big round number of 17,000. If we break the 17,000 support, the next level is 15,855 from mid-October. The …

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Financial Review

Ugly With Snow Flurries

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-01-27-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW – 291 = 17,387 SPX – 27 = 2029 NAS – 90 = 4681 10 YR YLD un 1.82% OIL + .65 = 42.80 GOLD + 10.80 = 1293.10 SILV + .13 = 18.13 New York City was shut down overnight. That “blizzard of the century” was indeed a bad storm but not the predicted “snowpocalyspe”, even though authorities shut down schools, roads, subways, and rail; and more than 8,000 flights were cancelled. Turned out to be an overabundance of caution. New England was socked quite solidly, but not the Big Apple. Weather forecasters got it wrong; not the first time. And once again we were reminded that the news media is centered in New York. (The bad news is that Wall Street opened this morning.) Let’s start with a few economic reports. Home prices edge 0.2% lower in November. The S&P/Case-Shiller 20-city composite index dipped 0.2% in November and that lowered the year-on-year advance to 4.3%, down from a reading of 4.5% in October. Phoenix posted a 0.2% increase in home prices in November, but the year-on-year advance was only 1.9%. The Case-Shiller report looks at resales of existing homes. Also today, the Commerce Department reported a big increase in new home sales; up 11.6% last month to a seasonally adjusted annual rate of 481,000. The gains were not enough to offset essentially flat home-buying over the …

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Financial Review

Flowers for Angela

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-01-26-2015.mp3Podcast: Play in new window | Download (Duration: 13:19 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW + 6 = 17, 678 SPX + 5 = 2057 NAS + 13 = 4771 10 YR YLD + .01 = 1.83% OIL – .49 = 45.10 GOLD – 12.80 = 1282.30 SILV – .39 = 18.01 It’s snowing in New York; this is a really, really big blizzard and it could dump up to 3 feet of snow across the northeast, with winds up to 60 miles per hour. The storm has already caused more than 1,800 flight cancellations, roads are closed in New York City except for emergency vehicles, rail traffic is also shut down, and schools are closed, and expect power outages across the Northeast. The Super Bowl will be this weekend in Glendale, and temperatures are expected to be mid-70’s. The folks at the Phoenix Chamber of Commerce are doing their happy dance. This week’s economic calendar is packed, plus we are in earnings reporting season and some big names will post results this week. Microsoft reported after the close today, and we’ll get to that in just a moment. Apple reports tomorrow. Shell, Europe’s largest oil company, reports results on Thursday; it could be an early indicator of the damage being done to company earnings by lower oil prices. Ford Motor, the nation’s second-largest automaker, reports fourth-quarter earnings on Thursday. On Wednesday, the Fed will end its two-day policy meeting with a statement …

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Financial Review

Friday Wrap

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-2-01-23-2015.mp3Podcast: Play in new window | Download (Duration: 20:25 — 9.3MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW – 141 = 17,672 SPX – 11 = 2051 NAS + 7 = 4757 10 YR YLD – .08 = 1.82% OIL – .95 = 45.36 GOLD – 8.00 = 1295.10 SILV – .02 = 18.40 For the week, the Dow rose 0.9 percent, the S&P gained 1.6 percent and the Nasdaq added 2.7 percent. The ECB announced plans yesterday to expand asset purchases by €60B per month until at least September 2016. ECB President Mario Draghi says the new stimulus plan “should strengthen demand, increase capacity utilization and support money and credit growth.” Well, it will make somebody rich, but the benefits to the broader Euro economy are still very much up in the air. Bonds in the region rallied, with the yields on 10-year notes of Germany, Italy, Spain and France falling to all-time lows. Stocks in the region on track for their best week since 2011 but the euro currency has dropped below $1.12. Greece’s leftist Syriza party leads the opinion polls heading into an election on Sunday. The ECB’s debt-purchasing program will not include Greece, at least not until July, and only then if a continuing review of the country’s bailout program is successfully completed. The basic bond buying plan wasn’t kind to Greece, even with the exclusion built in. The way, the ECB put together their QE scheme, rather than purchase government bonds …

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