Thursday, May 16, 2013

Economic Journal - Thursday, 5/16/2013

(As of 7:18 am PST)
 
Another data rich morning has investors struggling to find direction.  Jobless claims surged last week with 32,000 new people filing for unemployment benefits, bringing the jobless claims figure to a 6 week high.  Housing starts fell 16.5% in April, led by a big drop in apartment building construction.  Building permits, a sign of future demand in housing, rose 14.3% however.  Consumer prices fell for the second straight month and the inflation rate for the past 12 months fell to 1.1% in April from 1.5% in March.  Little evidence exists of inflationary pressure, which is good for the Fed’s interest rate policies and for consumers.  Markets were hovering around the unchanged line, until the Philly Fed index was released showing a negative reading in May.  The Philly Fed measures manufacturing activity in the Philadelphia region.  Any reading below 0 indicates more companies are contracting than growing.  After notching its highest closing level since 2008 yesterday, Europe’s key benchmark index moved lower Thursday.   Asian markets ended the day mostly higher, while Japan’s Nikkei finished lower despite positive economic data.  Gold continued its tumble from yesterday, down 1% as the dollar strengthened.  Interest rates took a dive with the 10 yr. treasury rate dropping to 1.88%.  Economic reports have generally been disappointing this week, but that hasn’t deterred investors from taking these markets to new heights.

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