Tag Archives: National Association of Home Builders

Markets Pop Despite Bad Euro News

16 May
sdac

“Here’s to ignoring Europe – and aggressively buying US stocks instead.”

Dow: 15,276, +60 (+0.40%)        S&P 500: 1,659, +8 (+0.51%) 

Insulting the king of Bahrain on Twitter?  That’s going to land you in jail (seriously) — but reading and forwarding your daily MarketSnacks to friends certainly won’t.  Check out why investor enthusiasm pumped the Dow up 60 points Wednesday (despite some painful European headlines).

#1. Google Shares Hit $900 on Music News

The time of the day is 9:35 AM EST… and the number is $900.  At that approximate moment, Google’s (GOOG) stock topped the $900/share mark (less than 3 months after hitting $800) because of a slew of announcements from Google’s nerd field day I/O conference. 

Watch out Pandora… Google introduced All Access, their version of a premium music streaming service.  All Access boasts new user-friendly features (Chicago Tribune), to compete with Pandora, Spotify, Amazon, and take a big leap out in front of Apple. 

Move the f**k over Siri… Google also released its answer to Apple’s voice search engine titled, “Conversation Search.”  Coming to Chrome browsers on mobile and desktop, users will be able to ask Google any question without having to touch a screen or keyboard — simply saying, “OK Google” brings up the search assistant. 

Adios MapQuest*… and “hola” to the new/improved Google Maps.  During the developers meeting Wednesday, Google announced they have completely redesigned Maps to be more user-friendly.  Coupled with 3D integration from Google Earth, Google Maps added an “Explore” feature to help you find local restaurants, attractions, and other tourist activities instead of asking the woman at the front desk. 

*To those still using MapQuest, please untie the sweatshirt around your waist and remove the schrunchie from your hair.  It’s time to grow up.

#2. European Economies Contract

Those 17 countries that use the Euro… are in an 18 month cold streak.  The euro countries Wednesday announced the gross domestic product (the most general gauge of economic output) for the first quarter, and overall the eurozone’s GDP shrank, again, for the sixth straight quarter by 0.2%.  The tallest of the european economic dwarfs was Germany, which squeaked out some growth, while the others got crushed, led by Greece.

Economic Contraction sucks… and should be avoided at all costs.  In the US we had two straight quarters of contraction after the financial crisis, which is the technical definition of a recession.  In Europe the debt crisis has caused the economies to stagnate for basically the last 5 years. Woof.



What’s the problem again?… the debt crisis, dummy.  A handful of countries are desperately trying to reduce their debt through austerity measures – cutting public spending by firing public workers and slashing benefits, which trickles through the economy. Also, despite efforts by the central bank to reduce interest rates, in countries not called Germany, banks are too afraid to lend to small businesses, so, yeah, things are still f***ed in Europe.

#3.

#3 John Deere Earnings Disappoint

“Take me for a ride on your big green tractor”… Sure thing Jason Aldean, but only if it’s not a John Deere.  Deer & Co (DE) dropped its 2013 earnings expectations a full percent Wednesday during their Q1 earning reports.

Their just “stuck in colder weather”… sang Zac Brown.  Not exactly, Zac.  Its cold and wet weather to be specific.  Due to the weather conditions, farmers have become reluctant to spend big on new equipment that they potentially may not use.  Farming equipment and crop prices have taken a beating so far in 2013.

The main concern… Analysts have been worried that the agricultural equipment cycle already peaked from the surge in sales post-recession.  The announcement today reinforced this belief, giving investors the chills and shrinking DE stock 4.4%.  

#4. Homebuilder Confidence Up — But Not Optimistic

Build on this… The National Association of Home Builders “confidence index” rose in May, but remains in slightly pessimistic territory (CNBC).  Although the housing market has been improving since early 2012, deep confidence among developers has stalled so far this year like a bad baseball game.

Why the not-so-smiley face?… Weather.  We didn’t know people were so soft, but according to the NAHB report, this cold spring has hurt construction efforts and homebuyer traffic.  The result?  A slowdown in the housing market’s recovery mojo. 

Thursday:

  • Some hefty housing data for ya: April Housing Starts & Building Permits
  • Your Thursday morning serving of Weekly Jobless Claims
  • 1st Quarter Earnings Reports: LG, Bank of Hawaii, Rent-A-Center, Six Flags…

MarketSnacks Fact of the Day:  The famous “black box” data recorders on commercial airlines are actually brightly colored (so they can be easily found in plane wreckage) and the 1st FAA-approved version was created by Lockheed (now weapons company Lockheed-Martin) in 1958.

 

Tags: , , , , , , ,

“FedEx Economic Outlook Drops Most Stocks”

18 Sep
"Given these FedEx expectations, there won't even be enough mail for the Post Office to deliver...Newman!"

“Given these FedEx expectations, there won’t even be enough mail for the Post Office to deliver…NEWMAN”

Dow: 13,565 (+0.09%)        S&P 500: 1,459 (-0.13%)

It’s so stormy in New York right now that the Yankees game is already cancelled and The Weather Channel has disposable interns outside interviewing commuters.  Inside the New York Stock Exchange, trading wasn’t as crazy as the weather.  The lone economic report showed that home builders’ confidence rising, but corporate news dominated the slow trading day, headlined by more unpromising commerce news from economic bellwether FedEx.  The blue chip-heavy Dow managed to edge up 12 points, while the S&P 500 ticked down on a day when over 55% of US stocks finished negative.

FedEx earnings beat expectations, but global growth forecast officially lowered

Remember when FedEx jumped into the news earlier this month for lowering its earnings forecast?  Com’on, of course you do – don’t sell yourself short (here’s a reminder).  Well the purple-orange delivery firm’s earnings were released today and although FedEx reported a profit and revenues topped expectations, they officially cut their full-year earnings outlook.  Their concerns are diminishing demand in economies like China and Europe combined with a slowdown in world-wide manufacturing.  With all the good stuff FedEx ships around this great planet, investors look to the firm as an indicator of the state of global commerce (this is known as a “bellwether” company).  FedEx (FDX) shares dropped over 3% on the announcement, while competitor UPS (UPS) couldn’t run & hide, losing 1%.

Manchester United Has bad first quarter as a public company, Apple hits $700

Manchester United (MANU) announced a huge loss in its first earnings period since this summer’s IPO.  Losses are beating profits: one – nil. The loss was right in line with expectations, though, as analysts can pretty easily gauge the club’s profitability for the April – June period based on how many home playoff games it played.  Man U was bloody awful this summer and bowed out of the playoffs early, so TV broadcast and stadium gameday revenues were down over 35%.  The real reason the stock fell is because Man U could not give a good outlook for its earnings since it all depends on how well their team plays and how far into the playoffs they go.  Barring the second coming of Pele in a Man U uniform, managers will never know how good they will be or what next year’s income statement will look like.  Investors are averse to risk, generally, and the lack of outlook on profits scared many into selling today.  About 6,000 miles from Manchester, Apple (AAPL) HQ in Cupertino, California celebrated the stock’s first day closing above $700.  The stock remains red-hot after its 1-hour sell-out of 2 million iPhone 5s available for pre-order.  Apple’s up 73% in 2012.

National Association of Homebuilders Index hits highest level since 2006

Limiting losses in stocks was a positive report on the all-important housing market.  An index of business confidence of homebuilders measured the highest level since 2006, just before the housing bubble popped and home prices plummeted.  Confidence in homebuilders is a good sign, indicating fewer vacant homes and some demand for new houses. Houses are assets, and consumers rely on their value as collateral for loans, an estate to pass on to children, or an asset that can be sold for cash (when the kids move out, when you retire, whatever). Any positive report on the battered housing market is good for the whole economy because it makes Americans wealthier and more likely to spend money.

Tomorrow:

  • A day packed with enough housing data to fill one of Mike Tyson’s homes (before he had to sell them all): Housing Starts, Building Permits and Existing Home Sales for August…

© 2012 MarketSnacks

Tags: , , , ,

“Solid Earnings and Good Housing Data Lift Stocks”

17 Jul

Analysts are underestimating Wall Street’s finest banks

Dow: 12,806 (+0.62%) S&P 500: 1,364 (+.74%)

Fear the beard. Federal Reserve Chairman (and “Just for Men” sponsor) Ben Bernanke stopped by Congress for his semi-annual 2-day address on the US economy. Investors were initially disappointed by the lack of specifics during the hearing, dropping the Dow 82 points – then stocks powered back to finish up 78 points (the biggest negative-to-positive comeback in 6 months). The National Association of Home Builders reported the largest monthly jump in confidence for newly built, single-family homes since ’02 and solid earnings from some big boy companies helped stocks up. The only black-eye was scandal news out of HSBC.

Ben Bernanke is mum on new stimulus

Dark, grim and scary. Nope, this isn’t a summary of the critics’ reviews for The Dark Knight Rises (get tickets for Thursday night while you still can), this was the sentiment in the room after Ben Bernanke’s testimony before the Senate on the economy. But he’s still slow to use the Federal Reserve’s monetary policy tools to help the slowing economy. The Fed only has so many tools to fix the economy, and Bernanke is reluctant to use any more stimulus unless things get worse. The Boos from Wall Street could be heard inside the Capital Dome in Washington.

Goldman Sachs and Coca-Cola earnings impress

The first slew of major earnings data this week came in mixed, but leaned toward positive. Coca-Cola (KO) added almost 2% on solid earnings that beat forecasts (Fact du Jour: What country consumed the most Coca-Cola beverages per capita last year? See the bottom of this paragraph). Goldman Sachs (GS) gained over 1% after easily beating 2nd quarter earnings expectations despite the adverse global market conditions. The investment bank also announced the sale of its hedge-fund administrator to Boston-based competitor State Street and plans on building a new in-house bank for lending to ultra-wealthy private clients. When expectations are low, it’s easy to win: Citigroup, JPMorgan, and Goldman all beat analyst earnings expectations, and saw their stocks rise even though earnings are down from last year (the answer by the way is “Mexico” – we were looking for “What is Mexico”).

British Bank HSBC charged with aiding money laundering

The Barclays Libor-rate fixing scandal (manipulated interest rates screwed borrowers out of millions) and JPMorgan‘s $4B trading loss are still fresh memories. But hey, when it rains, it pours. Now British-based HSBC (HBC), Europe’s largest bank, is under fire for what sounds more like the plot to the last Batman movie – charges that they gave terrorist, criminal and drug cartels access to the US (and maybe even Gotham’s) financial system. In a hearing of HSBC executives today, the U.S. Senate argued that the firm failed to guard against money-laundering (when financial institutions facilitate financial transactions/accounts for criminals) involving Mexican druglords and U.S. sanctions against Iran. Head of Compliance David Bagley even stepped down mid-hearing and their shares slipped 0.5%

  • The Senate today, the House tomorrow: Day 2 of Ben Bernanke’s semi-annual report to Congress on the U.S. Economy
  • More Earnings…IMB, Ebay, Bank of America…

© 2012 MarketSnacks

Tags: , , , , , , , ,

“High US Retail Sales Power Markets Up to Start Week”

16 Apr

"Shopping in March really beats expectations!"

Dow 12,921 (+.56%) S&P 1,370 (-.05%)

Now that this past weekend has given the MarketSnacks team the opportunity to close the book on the worst weekly performance of 2012 so far, we turn our virgin eyes to a new week and a clean slate. And for a change of pace, today’s slate boasted a mostly green-hue. A notably poor performance by the Big Kahuna burger of public companies, Apple, brought some stock indices down. But better-than-expected economic data on March retail statistics stole headlines and pushed the Dow to finish up 72 points. Stay tuned – this week’s primary financial themes will include a slew of American industrial economic data and headline company names for the early corporate earnings season.

US Retail Sales for March beat expectations again

The Commerce Department reported that retail sales in the US increased in March by 0.8%, almost three times the amount projected. Following the 1% increase in February retail sales, economists associate this positive trend with 2012′s improving job market and increased consumer confidence. A solid 11 out of 13 retail categories increased last month: electronics were up thanks to Apple‘s new iPad sales, while apparel chains The Gap (GPS), Target (TGT) and Macy’s (M) all saw a nearly 9% spike in sales. The headline announcement out-shined negative news from smaller, less-glitzy reports on national homebuilder confidence and manufacturing in New York State. While some analysts point out that this month’s bump may be partially attributed to individuals cashing in on tax returns, consumer spending is considered to be a key driver of economic growth and has now risen for 10 months in a row, keeping the market up today.

Apple continues 5 day losing streak

Golden-boy Apple (AAPL) is not invincible! Shares of the world’ most valuable company by market capitalization have skidded almost 9%, or $60/share, in the last 5 days, capped by a 4.15% plunge today. Apple has enjoyed Paparazzi-worthy attention as powerful sales have catapulted the stock up 160% in just the last six months. But no longer will stock analysts wonder if Apple is impervious to market doubt as some have begun to question if high iPhone demand can continue when wireless carriers cut back on subsidies. Other reasons for the drop could be investors cashing out on huge 2012 gains (+57% going into last week), selling before the upcoming quarterly earnings report which some speculate is bound to disappoint the ridiculous expectations Apple has created. Apple dragged down the S&P 500 and NASDAQ composite index, both of which are heavily weighted by this tech stock.

Citibank’s earnings impress investors

While Apple has been making Mama proud, Citigroup (C) has been one of Wall Street’s weakest children since the 2008 financial crisis hit. One of the three largest US banks, Citi stock has been hovering at a just small fraction of its 2007 highs. But had a much needed 1.77 % boost for its stock today as it reported improved 1st quarter earnings in its three major business units, in particular, increased lending to emerging market economies. The corporate earnings season, in which public companies report their overall financial performance over the previous quarter, kicked-off last week and results can have an immediate and significant impact on stock prices as investors sit back and judge.

Tomorrow:

  • The early corporate earnings season continues with blockbuster names: Coca-Cola (KO), Yahoo (YHOO), Goldman Sachs (GS)….
  • Economic data on “US Housing Starts” and “Industrial Production” in March.

© 2012 MarketSnacks

Tags: , , , , , , , ,

%d bloggers like this: