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Yearly Archives: 2013
Factory Orders and ISM Index
Factory Orders: Prior 0.5%, Market Expect 0.8%, Actual 0.4%
ISM Index: Prior 54.7, Market Expects 53.5, Actual 56.1
Comments »Top Conservative Group Club For Growth Urges House To Vote Against Hurricane Sandy Relief
“Two days after Republican infighting swirled around House Speaker John Boehner’s unexpected decision to pull a Hurricane Sandy relief bill from a potential floor vote, a top conservative group is urging the House of Representatives to vote against the bill.
The House is expected to vote today on the first part of the bill, a $9.7 billion flood insurance bill. Andy Roth, the Club for Growth’s vice president of government affairs, said in a statement that the federal government should not be involved in providing flood insurance.
Here’s the group’s full statement:
The Club for Growth urges all members of the U.S. House to vote “NO” on the bill to expand the National Flood Insurance Program’s borrowing authority by $9.7 billion. Consideration of the plan on the House floor is expected to occur today. This vote will be included in the Club for Growth’s 2013 congressional scorecard.
Congress should not allow the federal government to be involved in the flood insurance industry in the first place, let alone expand the national flood insurance program’s authority.
As we have said in a previous key vote alert, the proper way to address disaster relief is to release the funds in installments to make sure the resources are spent wisely. They should also strip out all immaterial line items, and fully offset all expenditures with spending cuts elsewhere. Serious reform would also include a way for the states to take over the responsibility for future disaster relief funding so that accountability is more localized.
Our Congressional Scorecard for the 113th Congress provides a comprehensive rating of how well or how poorly each member of Congress supports pro-growth, free-market policies and will be distributed to our members and to the public….”
Comments »HAHA: Teen Brags On Facebook About Drunk Driving, Gets Arrested
“Police made an example out of a teenager from Oregon who boasted about driving drunk on Facebook. “Drivin drunk… classic 
but whoever’s vehicle i hit i am sorry. 
,” wrote the clueless 18-year-old. According to local news channel KGW, two people tipped the officers via Facebook about the post. After inspecting the most-likely-profusely-sweating/hungover teen’s car, the damage on his vehicle matched that of two other vehicles hit earlier that New Year’s morning.
And, with their powers of deduction…bam! Handcuffs. The suspect was charged with two counts of “failing to perform the duties of a driver,” but not drunk driving, because a Facebook post is apparently not sufficient evidence of intoxication, according to KGW’s report from Deputy Chief Brad Johnston.
In a press release, the police wrote, “Astoria Police have an active social media presence. It was a private Facebook message to one of our officers that got this case moving, though. When you post…on Facebook, you have to figure that it is not going to stay private long.”
Comments »Gapping Up and Down This Morning
Upgrades and Downgrades This Morning
BK, CPHD, C, DOLE, FITB, FSLR, FSL, ILMN, JNJ, JPM, LULU, MSFT, SKT, TXT, UA, URBN, USB, WFC,
Comments »In Play and On the Wires
Pimco’s El-Erian: ‘Messy Politics’ to Drive Economy
” “Messy politics,” as demonstrated in the last-minute dodging of the fiscal cliff, will drive the economy in 2013, predicts Mohamed El-Erian, CEO and co-chief investment officer of PIMCO, in an article run for Project Syndicate.
Unless Congress becomes more cooperative, political polarization will fuel uncertainty, make budget talks more difficult and hamper economic growth, El-Erian says.
“From stymieing medium-term fiscal reforms to delaying needed overhauls of the labor and housing markets,” he states, “congressional dysfunction would keep U.S. economic performance below its capacity; over time, it would also eat away at potential output.” ”
Comments »Auto Industry Posts Best US Sales Year since 2007
“U.S. auto sales rose 9 percent in December, led by foreign manufacturers, capping off the best year for the industry since before the recession.
The year’s sales were driven by a slowly recovering economy, more available credit and the need for consumers and businesses to replace aging cars and trucks.
General Motors Co. posted December U.S. sales growth of 5 percent compared with the year-earlier month, Ford Motor Co. increased sales 2 percent and Chrysler Group LLC’s sales rose 10 percent.
Wall Street cheered the results, sending GM and Ford stock to their highest levels since July 2011. GM shares ended 2.4 percent higher at $29.82 and Ford shares were up 2 percent to end at $13.46 on Thursday.
Research and consulting firm Polk said it expects U.S. auto sales to hit 15.3 million vehicles in 2013. GM and Ford both predicted industry sales of more than 15 million vehicles, but Toyota Motor Corp offered a more modest forecast of 14.7 million vehicles.
For the year just ended, U.S. auto sales rose 13.5 percent to nearly 14.5 million new vehicles, the best performance since 2007, according to Reuters calculations.
In the decade prior to 2008 when the recession slowed the industry, U.S. auto sales averaged nearly 17 million vehicles a year….”
Comments »comScore: U.S. Holiday Shoppers Spent $42.3B Online, Up 14% From Last Year
“After announcing some early post-Christmas numbers, comScore just released its final analysis of U.S. online holiday spending for 2012: shoppers bought a total of $42.3 billion worth of goods online from November 1 to December 31. That’s up 14 percent from the $37.2 billion comScore reported last year, but a bit lower than expected as shoppers slowed down around mid-December.
While the numbers were up across the board, comScore registered especially strong increases in online shopping on Thanksgiving Day (up 32 percent to $622 million) and “Free Shipping Day” on December 17 (up 76 percent to just over $1 billion). While Christmas Day itself was rather slow with $288 million spent on online shopping, even that number was up 36 percent, though it couldn’t make up for a generally soft end of December.
Online Shopping Hits The Fiscal Cliff…”
Comments »Forrester Report Says Apple Will Sell $39 Billion In Macs and iPads To Businesses Over Next 2 Years
“Forrester Research is reporting that Apple will sell $39 billion in Macs and iPads through 2014.
According to the firm’s latest report, Apple will sell $7 billion worth of Macs and $11 billion in iPads to the corporate market this year. In 2014, Apple will sell $8 billion in Macs and $13 billion in iPads.
Forrester Analyst Andrew Bartels said to me in an email interview that Apple is having success in the corporate market for three reasons:
- Good products that employees want to use, and feel proud when their firm provides them.
- Best-in-class tablets in the iPad, which firms turn to first for tablets.
- A corporate sales organization that has been responsive to business demand and delivers competitive prices….”
Individual Investors Shun Money Managers to Shovel Massive Amounts of Money Into ETFs
“Investors are jumping out of mutual funds managed by professional stock pickers and shifting massive amounts of money into lower-cost funds that echo the broader market.
Through November, investors pulled $119.3 billion from so-called actively managed U.S. stock funds in 2012, the biggest yearly outflow since 2008, according to the latest data from research firm Morningstar Inc. MORN -0.80%
At the same time, they poured $30.4 billion into U.S. stock exchange-traded funds. When combined with bond ETFs, total inflows to such funds were $154 billion, the largest since 2008.
The move shows growing investor distaste for volatility, as the dot-com crash in the early 2000s, the financial crisis in 2008 and recent botched episodes such as last May’s Facebook Inc. initial public offering have shaken investor confidence.
It also reflects the fact that many money managers of stock funds, which charge fees but also dangle the prospect of higher returns, have underperformed the benchmark stock indexes. As a result, more investors are choosing simply to invest in funds tracking the indexes, which carry lower fees and are perceived as having less risk….”
Comments »Non Farm Payrolls: Prior 147k, Market Expects 145k, Actual 155k
SocGen: The Risk On/Risk Off Trade Is About To Die
“….The ‘risk-on/risk-off’ regime is based on the premise that good economic data in the US are bad for the dollar because the Fed is on hold for ever and US yields are so low that yield-hungry investors are squeezed out of US markets and into foreign currencies. If the traditional relationship between US yields and economic data is restored, the ‘risk-on/risk-off’ regime will come to an end (not before time), and stronger US data will be dollar supportive. This is going to happen at some point this year, and the overnight move is a taste of how it plays out. Only a taste however, as the FOMC is still too split and a change in Fed direction is still a long way away.
This has the potential to be a year in which markets behave very differently than they have….”
Comments »SEC Drops Case Against Ex-Berkshire Exec Sokol
“(Reuters) – The U.S. securities regulator has decided not to take action against David Sokol, once considered a possible candidate for the top job at Warren Buffett’s Berkshire Hathaway Inc, Sokol’s lawyer told Reuters.
In 2011, Buffett said Sokol violated the company’s insider trading rules to score a $3 million windfall profit on shares of U.S. chemicals maker Lubrizol, which rose by nearly a third after Berkshire Hathaway announced it would buy the company.
The U.S. Securities and Exchange Commission (SEC) began investigating Sokol’s investment in Lubrizol shortly after Sokol resigned from Berkshire Hathaway.
Sokol’s lawyer Barry Wm. Levine told Reuters late on Thursday that he was informed that the SEC had wrapped up its probe and decided not to take action against Sokol.
“SEC has terminated its investigation and has concluded not to bring any proceedings against Sokol,” said Levine, a lawyer at legal firm Dickstein Shapiro.
Sokol has been “completely cleared” as there was no evidence against his client, Levine said.
Berkshire Hathaway and SEC could not immediately be reached for comment by Reuters outside of regular U.S. business hours….”
Comments »$LLY Guides Full Year Profit higher
“Eli Lilly & Co. (LLY) provided an earnings forecast for 2013 that is more than analyst expectations.
Net income will be $4.03 to $4.18 a share this year, the Indianapolis-based drugmaker said today in a statement. Excluding one-time items, the company expects profit of $3.75 to $3.90 a share, more than the $3.71 average of 18 analyst estimates compiled by Bloomberg…”
Comments »Gold Set for Worst Run Since 2004 as Fed Sees End to Purchases
“Gold dropped to a four-month low in New York and headed for the longest run of weekly losses since 2004 after Federal Reserve minutes showed policy makers may end their $85 billion monthly bond purchases this year. Silver declined to the lowest since August.
Minutes released yesterday showed a divide among Fed members on how long the purchases should last. Participants who provided estimates were “approximately evenly divided” between those who said it would be appropriate to end the purchases around mid-2013 and those who said they should continue beyond that date. Gold futures fell below their 200-day moving average and are down for a sixth week, the longest run since May 2004.
“That there could be a lack of further quantitative easing measures has prompted a bit of profit-taking,” James Moore, an analyst at FastMarkets Ltd. in London, said today by phone. “It’s a knee-jerk reaction. There are still ultra-low interest rates,” which will support gold, he said.
Gold for February delivery slid 2.3 percent to $1,636.10 an ounce by 7:45 a.m. on the Comex in New York. Prices reached $1,626, the lowest since Aug. 21, and are down 1.2 percent this week. Gold for immediate delivery was down 1.7 percent at $1,636.08 in London.
Holdings in gold-backed exchange-traded products fell 10.2 metric tons yesterday, the most since May, to 2,620.8 tons, data compiled by Bloomberg show….”
Comments »Dollar Gains as Metals, Treasuries Fall on Fed Signal
“The dollar strengthened to a 2 1/2- year high against the yen, gold led commodities lower and Treasuries fell after the Federal Reserve said it may cut cash infusions this year. European stocks retreated while U.S. equity-index futures were little changed.
The U.S. currency rose against all but one of its major peers, appreciating 1.2 percent to 88.27 yen at 7:30 a.m. in New York. Treasuries fell for a fourth day, pushing 10-year yields to the highest since May, while U.K. gilts and German bunds also declined. Gold dropped 1.6 percent and oil in New York slid 1.1 percent. The Stoxx Europe 600 Index slipped 0.2 percent, while Standard & Poor’s 500 Index futures added less than 0.1 percent…”
Comments »Black Gold Falls Again As the Dollar Strengthens
“Oil dropped for a second day, erasing most of its weekly gain in London, after U.S. Federal Reserve officials signaled the winding down of a stimulus program this year in the world’s biggest crude user.
Brent futures dropped as much as 1.6 percent, trimming its weekly increase to 0.2 percent. Members of the Federal Open Market Committee said they will probably end their $85 billion monthly bond purchases sometime in 2013, according to minutes of its latest meeting released yesterday. The U.S. unemployment rate may have held at 7.7 percent, the lowest since December 2008, according to the median forecast of economists surveyed by Bloomberg ahead of a Labor Department report today.
“The U.S. is at a dangerous point where it could declare victory too early,” said Guy Wolf, a strategist at London-based commodities broker Marex Spectron Group Ltd., who predicts Brent will trade from $100 to $125 this quarter. “The risks to growth estimates in the U.S. in the second half are quite high. Removal of monetary stimulus combined with a fiscal tightening could be disastrous.”
Brent for February settlement slid as much as $1.76 to $110.38 a barrel on the London-based ICE Futures Europe exchange. It traded for $110.82 at 12:34 p.m. local time.
West Texas Intermediate for February delivery fell as much as $1.40 to $91.52 a barrel on theNew York Mercantile Exchange. The graded has added 1.2 percent this week. Brent was $18.97 more than WTI, compared with $19.27 yesterday….”
Comments »German Bunds Fall as Spanish Notes Climb on Global Growth Signs
“Germany’s bonds fell, with 10-year yields rising to the highest level in two months, on speculation a U.S. job report today will add to signs global growth is gaining momentum and undermine demand for safer securities.
Benchmark bund yields headed for the biggest weekly increase since July after German retail sales increased more than economists forecast in November. Spanish and Italian notes rose, extending their largest weekly gains since September, as reports showed services in the two nations contracted at a slower pace last month. Investors should buy Europe’s so-called peripheral bonds should they decline, Bank of America Corp.’s Merrill Lynch Wealth Management said.
“Flight to safe havens is fading and we think we will see slightly better data out of Europe this quarter,” said Ralf Umlauf, a research analyst at Landesbank Hessen-Thueringen in Frankfurt. “Fading support for bunds is pushing yields up. The main focus today is on the U.S. payrolls data, which we think may surprise on the upside.”
Germany’s 10-year yield rose seven basis points, or 0.07 percentage point, to 1.55 percent at 12:16 p.m. London time, the highest level since Oct. 26. The 1.5 percent bond maturing in September 2022 fell 0.635, or 6.35 euros per 1,000-euro ($1,301) face amount, to 99.55.
The 10-year yield may increase to 1.70 percent by the end of March, Umlauf said. A Bloomberg survey of analysts predicts the rate will end the first quarter at 1.59 percent….”
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