Economic Journal - Thursday, 5/9/2013

(As of 7:19 am PST)

 

Markets are lower this morning despite positive data on the jobs front.  The Labor Department reported that jobless claims fell slightly to 323,000 in the week ending May 4.  Economists expected claims to rise to 335,000.  The drop brought claims to the lowest level since January 2008 and helped ease concern over the pace of layoffs due to the sequester and other government cuts.  If the trend continues we likely could see a strong jobs number for May.  In international news, most Asian markets were lower on the day.  Chinese government data showed China’s consumer price index rose 2.4% in April from the year-ago period causing concern over inflation which would likely mean the halting of additional easing measures.  Wholesale prices fell sharply however and most analysts believe inflation pressure is quite low, at least in the short term as the increase remained below the government’s 2013 target of 3%.  Australia surprised with a stronger than expected jobs report which sent the Australian dollar surging on speculation of the next central bank interest rate decision.  European markets fell back on the Chinese inflation data but are slowly recovering as the day progresses.   Gold and oil are both down over 0.5% while interest rates are nearly unchanged.  We’ve traded in a tight range most the week as economic reports have been light. 

Economic Journal - Wednesday, 5/8/2013

(As of 7:10 am PST)

 

It’s another quiet day on the markets with the S&P and Nasdaq trading flat while blue chips in the Dow are down slightly.  International markets looked strong for a third consecutive day.  Asian markets finished higher across the board.  China reported a trade surplus with improvements to both imports and exports after previously reporting a deficit.  In Europe, markets are higher by 0.5% while regional economic data is light.  US markets are neutral as investors reach for news.  It is a very light week for economic data and thus difficult to gain direction for top-down investors.  On the earnings side, Walt Disney shares are off by 1.5% after reporting an earnings beat, while Whole Foods is surging, up nearly 8.5%, after beating estimates.  Gold has recovered most of yesterday’s losses, up 1.25% and oil is up slightly.

Economic Journal - Tuesday, 5/7/2013

(As of 7:12 am PST)

 

Markets are higher for the second straight day on mostly positive international news.  Australia’s central bank announced a surprise rate cut to its policy interest rate, a form of stimulus that surprised investors and trimmed early losses in Australia.  Asian markets finished higher with the Japanese Nikkei up 3.6%, closing at a multi-year high.  Chinese markets were cautious ahead of a slew of economic data due out tomorrow.  In Europe, markets appear strong to the upside as bank stocks are leading the way on positive earnings reports.  At home, markets are inching higher as the Dow crossed over the 15,000 mark once again.  The US dollar is weakening and interest rates are up.  Gold is down over 1% while oil prices are trading flat.  With central bank action continuing to surprise across the globe, investors seem set to continue bidding up this market. 

Economic Journal - Monday, 5/6/2013

(As of 7:05 am PST)

 

Markets are taking a pause this morning after a week which saw US stock indices soar to record highs.  An extremely light economic data calendar this week may give investors reason to evaluate positions and realign portfolios after the market’s recent run up.  News is very light today.  Asian markets are taking their cue from Friday’s US jobs data, and are up.  The Japanese markets were closed for holiday.  European trade is light with the Stoxx 600 flatlined and London markets closed for holiday.  The Nasdaq and S&P are slightly up while the Dow is trading lower.  Apple shares are up 2%, helping to carry the Nasdaq.  Gold is higher by 0.5% and oil is down 0.5% while interest rates are flat.  It appears it’s going to be a quiet day on the market as investors catch their breath after last week’s surge.

Economic Journal - Friday, 5/3/2013

(As of 7:10 am PST)

 

It’s all smiles today with most indexes opening to new record highs.  The new jobs figure came in at its highest level since 2008 and revisions from prior months provided an even stronger glimpse of the strength of the recent economic recovery.  Oil is up and gold is down.  The US currency is falling hard against most other currencies with investor risk appetite very high.  Interest rate yields are on the rise.  It looks like a great day for the bulls today amidst very positive economic data.  The only negative is that the need for more economic stimulus is on the wane and markets have become so reliant on easy money policy that there could be market pain as QE3 is rolled back.  But not today!  It’s all systems go!

Economic Journal - Thursday, 5/2/2013

(As of 7:10 am PST)

 

After a 1% selloff in markets yesterday, stocks are getting a bit of a bounce this morning on a surprise US jobs report and policy announcement from the European Central Bank.  The number of people who filed for unemployment benefits dropped by 18,000 to 324,000 last week the Labor Department announced today.   Claims are at their lowest level since January 2008, but may reflect seasonal oddities rather than an improving labor market.  The month after Easter generally is more volatile for claims.  In any case, the surprise number helped prop up markets in early trading.  In other economic news, the US trade deficit narrowed in March, led by a sharp decline in oil imports.  The shrinking deficit will likely help Q1 GDP as analysts were not projecting the sharp decline in their initial estimates.  In Europe, ECB President Mario Draghi announced earlier today a much anticipated interest rate cut, taking additional accommodative measures after recent data has shown Europe continues to be mired in recession.  In Asia, markets finished the day down.  Commodity prices are turning around with gold up 1.5% and oil higher by 0.67%.  Interest rates are mostly flat, but continue near historic lows.  The average 15 yr. mortgage rate hit a record low today of 2.56%.   

Economic Journal - Wednesday, 5/1/2013

(As of 7:05 am PST)

 

It is a troubled market this morning.  A commodities collapse in gold and oil and most other areas is putting investors on edge.  Troublesome economic reports from Asia, including anemic PMI data from China is adding to investor tension and it appears we are heading for a solid down day.  Federal Reserve minutes are due out today and there is worry that talk of a reduction in economic stimulus later in the year might add to market losses as investors see the Bernanke ‘put’ being reduced and risk becoming more of a factor.  Things can change dramatically in this market with rosy scenarios coming up thorns at times.  It has been a great run in 2013 thus far and now might be a good time to take some profits.