iBankCoin
Home / 2013 / May (page 12)

Monthly Archives: May 2013

PPI Drops the Most in Three Years, NY Manufacturing Falls

“WASHINGTON (Reuters) – Producer prices recorded their largest drop in three years in April as gasoline and food costs tumbled, pointing to weak inflation pressures that should give the Federal Reserve latitude to keep monetary policy very accommodative.

The Labor Department said on Wednesday its seasonally adjusted producer price index fell 0.7 percent last month, the biggest decline since February 2010. Wholesale prices had dropped 0.6 percent in March.

A Reuters survey of economists had forecast prices received by the nation’s farms, factories and refineries dropping 0.6 percent last month.

In the 12 months through April, wholesale prices were up only 0.6 percent, the smallest increase since July last year. Prices had increased 1.1 percent in March.

Underscoring the tame inflation environment, wholesale prices excluding volatile food and energy costs nudged up 0.1 percent, the smallest increase since November. The so-called core PPI had risen 0.2 percent in each of the previous four months.

In the 12 months through April, core PPI advanced 1.7 percent after rising by the same margin in March.

The report was the latest suggestion that disinflation was starting to creep in against the backdrop of lackluster domestic and global demand….”

Full article

“……New York Manufacturing Down

Activity in New York state’s manufacturing sector unexpectedly contracted in May, falling to the lowest level in four months as new orders and employment pulled back, data from the New York Federal Reserve showed on Wednesday.

The New York Fed’s “Empire State” general business conditions index fell to minus 1.43 in May from 3.05 in April, thwarting economists’ expectations for an increase to 4.

It was the first reading below zero since January, which indicates contraction for the sector….”

Full article

.

Comments »

$DE Beats Expectations, Guides Lower for the Year

“MOLINE, Ill. (AP) — Deere & Co. said on Wednesday that bad weather and weak economies will hinder sales growth this year.

The company reported better-than-expected second-quarter earnings and maintained its full-year profit prediction, but the outlook lowered Deere’s stock price in premarket trading.

Deere makes farm and construction equipment, and said sales of that gear would rise 5 percent during the current fiscal year, which is now half over. It had previously predicted growth of 6 percent.

The reduced sales expectation came after a long, cold winter in North America delayed the planting of this year’s seeds. It also slowed construction work and reduced demand for turf-care equipment, the company said.

CEO Samuel R. Allen also said Deere’s “near-term forecast is being tempered by lingering economic concerns in many parts of the world, which are restraining business confidence and growth.”

Deere’s second-quarter net income rose 3 percent to $1.08 billion, or $2.76 per share. That was up from $1.06 billion, or $2.61 per share, during the same period last year.

That topped analysts’ average estimates for earnings of $2.71 per share.

Revenue from equipment sales rose 9 percent to $10.27 billion from $9.41 billion a year earlier. Analysts had expected equipment revenue of $9.82 billion. Including financial services, Deere revenue rose 9 percent to $10.91 billion.

Deere raised prices 3 percent and shipped more gear during the quarter….”

Full article

Comments »

$M Posts Huge Profit Rise on Solid Sales

Source

“NEW YORK (AP) — Macy’s Inc. is reporting a 20 percent increase in first-quarter profit as the department store chain saw solid sales despite cool temperatures that dampened shoppers’ appetite for spring clothes.

The company, which also operates the upscale chain Bloomingdale’s, is also raising its dividend to 25 cents from the current 20 cents. It also announced an additional $1.5 billion in stock buybacks.

Macy’s, based in Cincinnati, says it earned $217 million, or 55 cents per share in the quarter ended May 4. That compares with $181 million, or 43 cents per share, a year ago.

Revenue rose 4 percent to $6.38 billion.

Analysts expected earnings of 53 cents per share on revenue of $6.4 billion.

Macy’s shares rose 46 cents to $47.85 in premarket trading.”

Full report

Comments »

Black Gold Falls for a Fifth Fifth Day as Europe Probes Price Manipulation

“West Texas Intermediate crude fell for a fifth day in its longest run of declines since December. Antitrust regulators are questioning European oil companies about possible manipulation of prices.

Futures traded near their lowest closing level in almost two weeks in New York. Crude inventories gained 1.1 million barrels last week, the industry-funded American Petroleum Institutesaid yesterday. A government report today may show stockpiles climbed 450,000 barrels, according to a Bloomberg survey. Royal Dutch Shell Plc, BP Plc, Statoil ASA and Platts said they’re being investigated after the European Commission conducted raids on their offices in three countries.

“The world will remain well-supplied,” said Andrey Kryuchenkov, an analyst at VTB Capital in London. “Higher prices lately have triggered a boost to capacity that will continue to outpace slack post-crisis demand growth.”

WTI for June delivery fell as much as 77 cents, or 0.8 percent, to $93.44 a barrel and was at $93.63 in electronic trading on the New York Mercantile Exchange at 11:15 a.m. London time. The volume of all contracts traded was 25 percent above the 100-day average. Prices decreased 96 cents to $94.21 yesterday, the biggest decline since May 1 and the lowest close since May 2.

Brent for June settlement fell 13 cents to $102.47 a barrel on the London-based ICE Futures Europe exchange. The volume of contracts traded was 57 percent higher than the 100-day average. The front-month European benchmark was at a premium of $8.90 to WTI, from $8.39 yesterday. It closed at $7.65 on May 13, the narrowest gap since January 2011.

Price Probe…”

Full article

Comments »

Iron Ore Enters Bear Market Territory as China Slowdown Expectations Grow

“Iron ore slumped into a bear market on concern that slowing economic growth in China, the world’s biggest buyer, will reduce demand as global supplies increase.

Ore with 62 percent iron content delivered to the Chinese port of Tianjin fell 1.3 percent to $126.40 a ton today, according to The Steel Index Ltd. The benchmark price has lost 20 percent since Feb. 20, when it reached a 16-month high of $158.90, meeting the common definition of a bear market.

China’s April industrial output trailed estimates and fixed-asset investment slowed, data showed this week, after economic growth unexpectedly contracted in the first quarter. Bank of America Corp. reduced its estimate on China’s 2013 gross domestic product growth to 7.6 percent from 8 percent.

“Chinese macro data has been worse than expected,” Daniel Hynes, Sydney-based head of commodity strategy at CIMB Group Holdings Bhd. (CIMB), said before today’s price decline. Rio Tinto Group’s planned expansion of its iron ore operation in Australia “brings focus back on the supply side which, from an Australian point of view, is growing strongly,” he said by phone today.

Prices will decline as supplies expand faster than demand over the long term, Alan Chirgwin, general manager of iron ore marketing at BHP Billion Ltd. (BHP), said May 8. Low-cost supplies mainly from Australia and Brazil will replace more expensive output and eventually exceed Chinese demand, he said.

Expansion Plans…”

Full article

Comments »

France Falls Into a Third Recession In the Last Four Years

“The French economy fell into its third recession in four years, increasing pressure on PresidentFrancois Hollande to adopt policies to revive growth.

Gross domestic product shrank 0.2 percent in the three months through March, following a revised 0.2 percent contraction in the previous quarter, national statistics office Insee said today. Economists expected a 0.1 percent drop, according to the median of 25 forecasts gathered byBloomberg News.

Celebrating his first anniversary in office today, Hollande is struggling to reduce the number of jobseekers from a record 3.22 million and lift his popularity rating from a record low. With the wider euro-area economy set to shrink for a second year in 2013, Hollande has been pushing to slow the pace of deficit reduction in the 17-nation bloc in favor of more pro-growth policies.

“The most important thing now is to create growth and employment,” Finance Minister Pierre Moscovici said this week in Brussels. “We must absolutely fight to have stronger growth in 2014 and to have the start of that growth in 2013.”

Euro-area GDP will drop 0.4 percent this year after a 0.6 percent decline in 2012, according to European Commission forecasts released earlier this month. First-quarter figures for the region will be published later today.

The commission said May 3 that it would give France another two years to reduce its deficit to less than 3 percent of GDP, though it said the nation’s lack of competitiveness is as much a part of the problem as the lack of growth in the region.

Hollande needs to press ahead with promises to revamp the nation’s labor law and pension system, the Commission said….”

Full article

Comments »

European Markets Rally on BoE Recovery Comments

“European stocks rose, extending their highest level since June 2008, after the Bank of Englandraised its growth forecast for Europe’s third-biggest economy. U.S. index futures were little changed, while Asian shares rallied.

EasyJet Plc (EZJ) led a gauge of travel companies higher after the low-cost airline said it will deliver improved returns and profitability for the full year. Commerzbank AG surged 15 percent on the first day that it offered new shares to investors. ThyssenKrupp AG climbed 1.3 percent after Germany’s biggest steelmaker reported earnings that exceeded estimates.

The Stoxx Europe 600 Index gained 0.4 percent to 306.95 at 1:08 p.m. in London. The equity benchmark has rallied 9.8 percent so far this year, bolstered by monetary stimulus from the world’s central banks. Futures contracts on the Standard & Poor’s 500 Index slipped 0.1 percent today, while the MSCI Asia Pacific Index advanced 0.6 percent.

“Quantitative easing globally is driving the market,” said Andrea Williams, who helps oversee $76 billion as head of European equities at Royal London Asset Management. “Generally, valuations still look reasonable and the corporate results season has also been OK.”

U.S stocks rallied yesterday, sending the S&P 500 to its eighth record in the past nine trading days, amid increased optimism about the world’s largest economy. Asian equities rose today with Japan’s Nikkei 225 Stock Average climbing above 15,000 for the first time since January 2008.

Britain’s Recovery….”

Full article

Comments »

Dr. Copper Continues to Trend Lower as Stockpiles Build and Outlook for Growth Wanes

“Copper reached a one-week low in London on concern economies are weakening in the world’s biggest consumers of the metal while stockpiles are the highest since 2003, indicating ample supply.

The German economy expanded less than forecast in the first quarter, statistics showed today. Bank of America Merrill Lynch cut its estimate for growth this year in China, following JPMorgan Chase & Co. by a day. A report today will show industrial production in the U.S. shrank 0.2 percent last month, economists said. The nations are the three largest copper users.

“The poor GDP figures from Germany and France plus banks’ cut on China GDP growth lent much pressure to the metals market,” Pengjiang “Richard” Fu, director for Asian commodities trading at Newedge Group SA in London, said by e-mail. France entered a recession last quarter, figures showed.

Copper for delivery in three months slid 1.1 percent to $7,166 a metric ton by 10:23 a.m. on the London Metal Exchange. Prices reached $7,151, the lowest since May 3. Copper for delivery in July fell 1 percent to $3.254 a pound on the Comex in New York. Aluminum retreated for a fifth session in London and tin tumbled the most in two weeks….”

Full article

Comments »

Au Falls to a Three Week Low

“Gold dropped for a fifth day in the worst run since February in New York, to a three-week low, as a stronger dollar curbed demand for an alternative investment and bullion holdings declined. Other precious metals fell.

Holdings in exchange-traded products dropped 6.2 metric tons to 2,219.7 tons yesterday, the lowest since July 2011, according to data compiled by Bloomberg. The U.S. Dollar Index, a measure against six major currencies, reached the highest level since July today. Gold has retreated 16 percent this year, tumbling into a bear market last month, as some investors lost faith in the metal as a store of value and equities rose.

“The dollar is doing well,” Peter Fertig, the owner of Quantitative Commodity Research Ltd. in Hainburg, Germany, said today by phone. The ETP selling “is of course also a negative for the market and it’s indicating that among institutional investors there’s a negative sentiment. Retail buying isn’t enough to compensate.”

Gold for June delivery fell as much as 1.3 percent to $1,406.30 an ounce, the lowest since April 23, and was at $1,409.70 by 7:49 a.m. on the Comex in New York. A fifth day of losses would be the worst run since Feb. 20. Futures trading volume was 34 percent above the average in the past 100 days for this time of day, according to data compiled by Bloomberg. Gold for immediate delivery in London fell 1 percent to $1,411.49.

ETP Sales…”

Full article

Comments »

A Shrinking Bond Yield Premium Takes the Aussie Dollar Down to 11 Month Lows

Australia’s dollar fell to an 11-month low after the premium the nation’s bonds offer over U.S. debt shrank to the least in a year, sapping the allure of the currency as a higher-yielding asset.

The extra rate investors get by holding the South Pacific nation’s 10-year notes instead of similar-maturity Treasuries dropped to 1.27 percentage points yesterday, the lowest since June 2012. Yields on U.S. securities reached a two-month high this week amid speculation theFederal Reserve may consider tapering bond purchases as the economy improves.

“For the remainder of the week, the Aussie dollar will be quite heavy,” said Joseph Capurso, a Sydney-based foreign-exchange strategist at Commonwealth Bank of Australia, the nation’s biggest lender by market value. “The U.S. dollar will remain quite firm, I think U.S bond yields will continue to lift a bit further.”

The Australian dollar lost 0.3 percent to 98.63 U.S. cents as of 5:29 p.m. in Sydney after touching 98.52, lowest since June 12 last year. The currency extended its decline to an eighth day, the longest run of slides since August 2011. New Zealand’s currency was little changed at 81.90 U.S. cents.

The yield on Australia’s 10-year note gained three basis points, or 0.03 percentage point, to 3.27 percent today. Traders see about a 60 percent chance that the Reserve Bank of Australia will lower the benchmark rate within three months after cutting it to a record 2.75 percent on May 7, according to data compiled by Bloomberg on overnight-index swaps.

RBA Policy….”

Full article

Comments »

Daniel Loeb’s Plan to Split $SNE Seen as a HUGE Opportunity

“Billionaire investor Daniel Loeb’s proposal to separate Sony Corp. (6758)’s movie, music and TV businesses would give the Tokyo-based company a chance to join the 3 1/2-year media rally it has missed.

Loeb, founder of Third Point LLC, yesterday recommended selling as much as 20 percent of Sony’s entertainment unit in an initial public offering that would free it from the struggling electronics business. As an independent company, the maker of “Spider-Man” movies would benefit from more disciplined management, investor attention and fatter profits, giving a $6.1 billion lift to Sony’s market value, he wrote in a letter to Chief Executive Officer Kazuo Hirai.

The move from Sony’s largest shareholder comes as media stocks surge to all-time highs amid growing optimism that makers of films and television shows will weather a decline in home-video sales by signing online outfits like Netflix Inc (NFLX). and Amazon.com Inc. (AMZN) as distributors. With Sony the top-grossing U.S. film studio last year with year with $4.4 billion in worldwide ticket sales, the spinoff could boost the value of its entertainment unit as much as 50 percent, according to Paul Sweeney, a senior analyst at Bloomberg Industries.

“Media stocks have been ripping over the past three-and-a-half years,” said Sweeney, who estimates Sony’s entertainment units, valued at an implied $8 billion, could fetch as much as $12 billion. “Investors have a hard time valuing those businesses within the greater Sony conglomerate.”

Entertainment Boom

Media stocks including Walt Disney Co. (DIS)Lions Gate Entertainment Corp. (LGF) and CBS Corp. (CBS) are at or near all-time highs. Since January 2010, the S&P 500 Media Index has more than doubled, while Sony, with one of the world’s largest collections of movie, television and music businesses, has declined 28 percent….”

Full article

Comments »

Japanese Stocks Hit New Highs Not Seen Since 2007, Bolstering Most Asian Markets

“Asian shares rose as stocks in Japan climbed to their highest level since December 2007 and yields on the nation’s 10-year bond advanced to the most in more than a year. South Korea’s won declined and palladium retreated.

The MSCI Asia Pacific Index added 0.8 percent at 1:12 p.m. in Tokyo as Japan’s Nikkei 225 Stock Average jumped 1.9 percent, breaching 15,000 for the first time since January 2008. Standard & Poor’s 500 Index futures were down 0.1 percent after the equity gauge advanced to a record yesterday. The yen rebounded from a 4 1/2-year low, while the won retreated 0.7 percent. The dollar traded near the strongest in five weeks against the euro as U.S. 10-year Treasury yields headed toward 2 percent for the first time since March. Japan’s 10-year rate climbed as high as 0.92 percent.

Sony Corp. surged as much as 14 percent as billionaire Daniel Loeb’s Third Point LLC hedge fund pushes for the Xperia smartphones and Bravia televisions maker’s breakup. Toyota Motor Corp., the world’s biggest carmaker, rose to pace gains among Japanese exporters, boosted by signs of recovery in the U.S. economy and a falling yen. Data on U.S. April producer prices and first-quarter euro zone GDP are due later today with the former expected to show declines from March, according to a Bloomberg News survey of economists.

“Momentum is building for a global stock rally,” said Hiroichi Nishi, an equities manager in Tokyo at SMBC Nikko Securities Inc., a unit of Sumitomo Mitsui Financial Group Inc. (8316), Japan’s second-biggest lender. “Downward pressure on the yen against the dollar is strengthening, boosting earnings outlooks, especially for exporters.”

Toyota, Yamaha

About two stocks rose for every one that fell in the MSCI Asia Pacific Index. Toyota increased 2.4 percent while motorcycles maker Yamaha Motor Co. advanced 8.4 percent. The MSCI Asia Pacific Index has gained 11 percent this year versus a 16 percent rally by the S&P 500 and a 9.3 percent advance by the Stoxx Europe 600 Index.

Hong Kong’s Hang Seng Index advanced 0.5 percent, rebounding from its biggest two-day drop in a month. Li & Fung Ltd. jumped 7.4 percent after UBS AG raised its investment rating on the maker of toys and clothing. Sun Hung Kai Properties Ltd. gained 1 percent after the city said it will offer two residential sites for development.

Yen, Won

The U.S. dollar traded at $1.2934 per euro from $1.2920 yesterday when it touched $1.2912, the strongest since April 5. The currency has gained as improving sentiment toward the U.S. economy spurred speculation the Federal Reserve will reduce stimulus.

The yen gained 0.3 percent to 102.16 against the greenback after sliding to 102.43, matching the weakest since October 2008. The yen’s 14-day relative strength index versus the dollar was at 29.8603, below the 30 level which indicates an asset’s price has fallen too rapidly and may be poised to reverse course….”

Full article

Comments »

Corporate Earnings Reach Critical Levels for the DOW

“The Dow Jones Industrial Average has been increasing aggressively all year, and investors see no end in sight. The Dow ETF (DIA) is now over $150 and at an all-time high. Arguably, central banks have started to buy equities, and because they tend to be attracted to safer investments, we could surmise that central bank equity investments are targeting the Dow Jones Industrial Average as well. But are they right to do so?

Historically, the Dow Jones Industrial Average has been comprised of safer equity investments, companies capable of weathering substantial hits to the stock market, but more importantly, companies with business models that have been proven to work over time.

Given what we all have known about the DJIA in the past, and what we know about its composition today, we can still agree that the companies that comprise the index are solid companies that are likely to withstand major economic catastrophe, but at a certain point, valuation must come into play. In this specific instance, it is a concern….”

Full article

Comments »

Sam Zell: ‘Current Euphoria in Stock Market Will Be Adjusted’

“Top real estate investor Sam Zell is predicting stocks will soon tumble.

“Right now you are buying at an all-time high,” Zell said at a hedge fund conference in Las Vegas, according to Fortune magazine. “And there are times when stocks hit a high, and then go higher, but that’s when you have a good economy.”

Stocks are up 15 percent so far this year and the Dow Jones Industrial Average has passed 15,000 for the first time. But while stock prices are booming, underlying fundamentals remain weak, said Zell, chairman of Equity Group Investments, noting his own companies are still struggling to increase revenues.

Editor’s Note: 
Billionaires Dump Stocks. Prepare for the Unthinkable.

“The current euphoria in the stock market will be adjusted,” Zell stated, Fortune reported. “And I hope that’s all that happens.”

Besides the weak U.S. economy, other causes for concern are the turmoil in the Middle East and the Bank of Japan’s push to re-energize its economy by increasing inflation.

“That’s not QE [quantitative easing],” he said of Japan’s policy. “I don’t know what you call it.”

Zell believes the housing market might also be in a bubble, as large investors are buying houses in large quantities, pushing up prices. They might end up losing money, warned Zell, who noted that managing houses is more difficult that owning apartment buildings…”

Full article

Comments »

Bernstein’s Masters Still Sees Dow 20,000 by 2019

“Last July, when stocks weren’t doing so hot and the Dow Jones Industrial Average rested below 12,900, Seth Masters, chief investment officer of Bernstein Global Wealth Management, made a bold call.

He predicted the Dow would reach 20,000 by the end of the decade. And he’s sticking to his guns, The New York Times reports, even though the prediction isn’t quite so controversial with the Dow closing at 15,091 Monday.

“It seems we’re somewhat ahead of schedule, but I think we’re still on track for Dow 20,000 by the end of the decade,” Masters told the paper. “The odds have just gotten better.”

He still thinks stocks are cheap as compared with bonds.

“It’s not that the expected return on stock right now is really that high,” he said. “It’s that the return on government bonds is indubitably very low.”

The 10-year Treasury yield stood at 1.92 percent early Tuesday morning.

To be sure, the rise in stocks won’t be straight up, Masters says. “I don’t think the path to Dow 20,000 will be linear. … There will be declines, you can count on that.” …”

Full article

Comments »

Gapping Up and Down This Morning

SOURCE
NYSE

GAINERS

Symb Last Change Chg %
CYNI.N 12.38 +1.27 +11.43
I.N 21.84 +1.18 +5.71
SEAS.N 36.86 +1.70 +4.84
AXLL.N 47.62 +1.63 +3.54
SSNI.N 16.96 +0.54 +3.29

LOSERS

Symb Last Change Chg %
MRIN.N 9.41 -0.58 -5.81
WAC.N 36.77 -1.10 -2.90
SBGL.N 3.57 -0.10 -2.72
PBF.N 29.39 -0.63 -2.10
NRZ_w.N 6.83 -0.14 -2.01

NASDAQ

GAINERS

Symb Last Change Chg %
MOBI.OQ 3.11 +0.94 +43.32
ALIM.OQ 3.96 +0.85 +27.33
UNIS.OQ 3.76 +0.76 +25.33
SCTY.OQ 35.88 +7.00 +24.24
CNIT.OQ 2.41 +0.40 +19.90

LOSERS

Symb Last Change Chg %
SBLK.OQ 6.39 -1.34 -17.34
RDHL.OQ 10.33 -1.60 -13.41
DRWI.OQ 2.17 -0.24 -9.96
SPCHA.OQ 2.01 -0.19 -8.64
DBLE.OQ 4.35 -0.41 -8.61

AMEX

GAINERS

Symb Last Change Chg %
BXE.A 6.12 +0.24 +4.08
TXMD.A 2.76 +0.05 +1.85
NSPR.A 2.82 +0.05 +1.81
ALTV.A 10.07 +0.05 +0.50
NML.A 20.15 +0.06 +0.32

LOSERS

Symb Last Change Chg %
OGEN.A 3.10 -0.25 -7.46
FU.A 4.16 -0.24 -5.45
EOX.A 6.53 -0.37 -5.36
SAND.A 7.56 -0.15 -1.95
MHR_pe.A 23.05 -0.45 -1.91

Comments »

Tom Lee of $JPM Puts Out a List of the Best Stocks to Own for the Next Couple of Quarters

JP Morgan‘s Tom Lee is one of the most accurate strategists on Wall Street, having nailed the S&P 500’s path in 2012.

In his brand new note to clients, he offers his list of “23 Ideas For The Next 3-6 Months.”

“Our base case in the short term sees equities higher through the end of 2Q and Cyclicals outperforming (dead cat bounce, 1Q laggards leading in 2Q, etc.),” he wrote. “However, there is a case to be made that Cyclical leadership will likely be a three- to five-year story with Technology, arguably the least consensus, therefore perhaps best positioned”

Lee’s picks run the gamut from biotech to semiconductors to retail.

The group boasts an average 2013 estimated price-to-earnings ratio of 12.3x and an average upside potential to their target prices of 13%.

Full article

Comments »