Wednesday, July 24, 2013

Economic Journal - Wednesday, 7/24/2013

(As of 7:15 am PST)
 
It’s a back and forth morning for stocks with earnings driving market direction again.  Stock futures were higher going into the open after positive earnings from Apple and Boeing.  Apple beat expectations on the bottom line and shares are up 4% this morning, carrying the Nasdaq higher.  Early gains were pared after Caterpillar reported disappointing earnings.  The global equipment maker reported a drop in Q2 profits and lowered its outlook.  Shares of CAT are down 1.9% and pulling the Dow down with it.  Other big names reporting include AT&T, who reported slipping profits after the bell yesterday, and Ford who posted better than expected earnings.   In economic news, a flash reading of the PMI manufacturing report showed activity picking up in July to the highest level in 4 months.  Also, a housing report showed new US home sales rose 8.3% to an annual rate of 497,000 in June, marking the highest level in 5 years.  International markets are mixed with most Asian markets closing lower after disappointing data out of China which showed a preliminary reading of manufacturing activity slipping in July.  Europe is enjoying a nice trading session after upbeat manufacturing reports out of France, Germany and the euro-zone.  Gold is notching higher, while oil is down 0.5%.  Interest rates jumped this morning with the 10 yr. treasury moving back up to 2.58%.  We’re in the thick of earnings season, with the tone so far a positive one for stocks, however the outlook for earnings in the second half of the year is cause for concern and investors seem to be taking a cautious stance today.

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