Archive for the ‘Economy’ Category

First quarter ends on positive note

Posted by Michael on March 31st, 2009

The first quarter was a strange three months for the stock market. All the major indexes finished in the green to cap off a period that saw massive swings in both directions.

The DOW lost about 25% between the second week of January and early March, but has made up a lot of lost ground over the past couple of weeks, as investors are starting to believe that the worst is behind us. We have been getting a little encouragement in the form of consumer confidence rising a bit, some faith that Obama is going to be able to free up the credit market a little and help boost both the financial and automotive industries.

It is still unclear as to what shape the economy is really in at this time, and how quickly we can break out of the current recession, but investors have been expressing optimism the past couple weeks, and we will see just how strong that momentum is, and if we can carry it into the next quarter.

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Market Update – Markets close the week on a sour note

Posted by Michael on February 13th, 2009

Friday was another sell off for the market, as investors continue to show fear ahead of a plan out of Washington on how to reverse the current recession that seems to be deepening with each passing day.

The DOW was down 1.04% today, the NASDAQ traded 0.5% lower, and the S&P dropped another 1.0% in today’s trading.

For the week, the DOW dropped a total of 5.2%, and is sitting at lows that we have not seen since back in November when fear was running rapid among traders regarding the future of the economy.

One thing that is keeping traders in a selling mode is the waiting game to see what version of the current stimulus package actually gets approved. In today’s news, the House of Representatives passed their version on the stimulus package, a $787 billion plan to boost the economy. The next step is to get the bill pass the Senate, which is expected to cast its vote later today.

President Obama was optimistic that the bill had made it through the House, and now awaits to see if the Senate will send him the bill for his approval next week.

In other news today, two of the big banks, JPMorgan Chase, and Citigroup announced that they were enacting a moratorium on new foreclosures until they see what sort of plan Obama announces to help ease the huge increases in foreclosures that are hitting the market. Both banks have suspended new foreclosures until the first part of March in hopes of easing the pain that many homeowners are currently dealing with.

The markets will be closed on Monday, so we will have to wait until Tuesday to see if the market can make up some of its recent losses.

Enjoy your Valentines Day, and your long 3 day weekend.

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Posted in After the Bell, Bad News, Congress, Economy, Foreclosures, Housing, Market Updates, Politics, Recession Tags: , , , , , , , No Comments »

Wal-Mart (WMT) puts up strong January sales figures

Posted by Michael on February 5th, 2009

Retail sales figures for January are in, and the picture is not pretty for most retailers out there. According to the International Council of Shopping Centers, sales dropped by 1.6% in January, which was actually a little better than the 2 to 3% dip analysts had been expecting, but still marking the fourth straight month sales have shrunk.

While most retailers are facing hard time, Wal-Mart (NYSE: WMT) actually had a sales increase in the month. As consumers tighten up their spending, and look for cheaper products, it doesn’t really come as much of a surprise that shoppers are heading into Wal-Mart stores, which typically have the reputation of lower prices.

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Premarket look: Market poised for lower start to kick off February

Posted by Michael on February 2nd, 2009

Taking a look at futures trading this morning indicates that the market is going to get off to a tough start for the trading day of February.

Investors continue to express concern that the stimulus package that was recently passed in the House is not going to get passed when the Senate gets its chance to vote on the new plan. There is still a good deal of concern over what the new package is going to do to address the ailing bank industry.

Consumer spending fell again in December, as the Commerce Department announces that personal spending in December fell by another 1%, as incomes dropped by 0.2% in the month as layoffs continue to mount. Analysts had been expecting to see consumer spending off by 0.9% in the month.

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Federal Reserve lowers key interest rate

Posted by Michael on October 8th, 2008

With the way the market has been moving violently lower the past couple of week, the Federal Reserve announced today it was lowering its key federal funds rate by half of a percentage point, down to 1.5%. It lowered the discount rate by the same amount, down to 1.75%.

The Fed stated that economic growth had slowed “markedly in recent months,” and that the cut was necessary.

Futures are trading higher this morning, and it looks like we should break the five day losing streak on Wall Street, and get some much needed bounces in some pretty beaten up stocks today.

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Premarket look: Market poised for another sell off

Posted by Michael on October 6th, 2008

Another tough day ahead of us on Wall Street, as international markets have sold off about 4% today on widening fears over the slowing global economy.

Look for another sell off on Wall Street, as futures are indicating a very sharp drop at the open. After the volatile week last week, many of us had some hopes that the Bush approved $700 billion bailout plan that was passed late on Friday would help spark a slight bounce, but that is not to be the case, and stocks are set for a much lower open to get the week started.

There is going to be a lot of pain out there today.

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Posted in Bad News, Before the Bell, Congress, Consumer Experience, Economy, George Bush, Major Moves, Market Updates, Politics, Recession No Comments »

Market should open higher after yesterday’s sell off

Posted by Michael on September 30th, 2008

Yesterday was brutal on the stock market, with the largest one day drop in history, as the DOW fell 777 points, a decline of nearly 7. The Nasdaq dropped by even more on a percentage basis, with a decline of 9.14%, and the S&P gave back 8.8% yesterday.

Futures are trading higher today, but it is going to take a lot more than one day of upside to make up what we lost yesterday.

Yesterday started off slowly as investors were skeptical that the proposed Bush bailout plan was going to be enough to save the troubled economy, but that fear turned to panic once the market realized that the plan was not going to go through all at yesterday afternoon.

Lawmakers are going to be on holiday until Thursday to observe the Jewish holidays, but there should still be some action taking place behind closed doors aimed at ironing out a new deal that will satisfy both Congress and Wall Street. We will see if / when that is able to take place.

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Wall Street heads for lower open on bailout possibility

Posted by Michael on September 29th, 2008

Looks like another tough start to the week for Wall Street, as traders express their disappointment in the proposed bailout plan that looks likely to pass Congress the week.

The Bush administration is pushing hard for its $700 billion bailout, but Wall Street doesn’t believe that the Bush plan is going to be enough to help bailout the struggling economy, and futures are trading sharply lower this morning now that it appears that plan is going to pass Congress later this week.

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Premarket look : Market poised for a strong start to the day

Posted by Michael on May 30th, 2008

Futures are trading above fair values this morning as Wall Street prepares for a strong start to the day.

There are two main factors at work today, strong earnings from computer giant Dell Computer (NASDAQ: DELL), and positive economic data on consumer spending that came out this morning.

DELL reported its first quarter numbers last night, and easily beat analyst estimates for the quarter, showing earnings of 38 cents per share, which was well above the 34 cents a share that analysts had been expecting to see. The company noted strong growth in both its consumer and commercial business lines as being key components to its strong quarter.

Also giving the market a boost this morning was the release of April consumer spending figures which showed a 0.2% rise in the month of April. This was in-line with what Wall Street was hoping to see, and a sign that the current economic slowdown and record high gasoline prices has not kept Americans from spending.

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Inflation eases a bit in April

Posted by Michael on May 14th, 2008

Despite surging food prices, inflation was actually a bit lower in April than the 0.3% inflation that we saw back in March.

According to the Labor Department, inflation moved up 0.2% in April, which was slightly under the 0.3% inflation in March. Analysts had been expecting to see inflation rise by 0.3% again in April.

If you exclude food and energy costs, then you are left with a core inflation, which was really well behaved in April, only rising by 0.1% during the month. Analysts had been expecting to see core inflation growth of 0.2% for the month.

While it is good to see that inflation is not rising as rapidly as some had thought, you have to take into account the current run up in oil prices. With oil trading up close to $127 a barrel, inflation could be getting ready to really jump. Analysts are warning that the current record high oil prices have still not be felt at the consumer level yet, and their impact could be rather dramatic.

Looking at inflation for the year, overall inflation is now running at an annual rate of 3%, compared with the 4.1%  increase that we saw in all of 2007. The Federal Reserve, which has been slashing interest rates lately in an attempt to fight off a recession, has signaled that it would more than likely pause the rate cuts in order to fight off any unwanted inflation in the months to come. The next time the Fed meets will be the third week in June, and dont expect the April numbers to lead them to change their stance and cut rates. I am sure that everyone is still waiting for the other shoe to drop on the recent run up in energy prices.

You can find a pretty nice graph of CPI inflation since 2000 over on economistblog

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Posted in Consumer Experience, Economy, Energy, Federal Reserve, Good News, Oil No Comments »
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