Short but noisy week ahead for stocks
After the best June for stocks in at least 12 years, the coming week compresses a lot of information into 4 days. The big event is Friday's jobs report, but key reports are due on manufacturing and auto sales. Europe will move markets as well.
The week ahead will have its own dramatic moments, even as U.S. markets take a daylong break on Wednesday for the July 4 holiday. They will also close early on Tuesday.
Everything will build up to the jobs-and-unemployment report on Friday, which most economists believe won't be much to get excited about. There's the Institute for Supply Management's June report on manufacturing on Monday and auto manufacturers' reports on sales for the month on Tuesday.
While there are few earnings reports that can really move markets on the schedule, there is still Europe to worry about. Stocks shot up Friday largely because eurozone leaders said they were crafting a new plan to save their banking system and start to get their debt crisis under control. The coming week will bring the hard questions on how the plan will work. There will be lots of skepticism because so many plans were immediately found wanting.
Among the big questions that will be asked is if the Europeans can craft a plan fast enough to minimize the slowdown that is gaining strength by the day. Shares of Ford Motor (F) and Nike (NKE) fell on Friday after both said the slowdown in Europe is hurting their businesses.
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The U.S. market looked like it might fall off a cliff after a narrow majority on the Supreme Court upheld President Obama's health care law, but the hint of a European deal brought stocks back late Thursday and the announcement of a deal on Friday set off a big rally.
The Dow Jones industrials ($INDU) finished up 278 points for the day, and the blue chips ended the week with a 1.9% gain, and a 3.9% gain for June, its biggest monthly increase since October and its best June since 1999.
The Standard & Poor's 500 Index ($INX) rose 4% for the month -- also its best June since 1999 and its best month since October. The Nasdaq Composite Index ($COMPX) added 3.8% for month, its best since February and its best June since 2000.
For the year, the Dow is up 5.4%, after a 2.5% loss in the second quarter. The S&P 500's gain at midyear is 8.3% after falling back 3.3% in the quarter, and the Nasdaq is sporting a relatively gaudy 12.7% for the year despite a 5.1% decline in the second quarter.
At the same time, crude oil (-CL) in New York fell 1.8% in June to $84.96 a barrel and was off 17.5% for the quarter. The national average price of gasoline has fallen to $3.353 a gallon from a high of $3.936 a gallon in April. The price fell 7.4% in June and 14.6% in the quarter.
The cost of a 20-gallon fill-up has fallen from $78.72 to $67.06. That's a savings of $11.66. If you live in, say, Los Angeles, the savings are real.
There are lots of head winds for the market for the rest of the year. The biggest are Europe and the so-called fiscal cliff. Plus, profit growth for the second quarter is expected to slide.
Europe will be a big issue because the chatter about the debt crisis has morphed into a probable regionwide recession that is affecting businesses elsewhere. Like Ford, Nike and others.
The fiscal cliff that the federal government faces -- if not dealt with with care and a spirit of compromise -- could cause huge and abrupt spending cuts that would probably send the domestic economy into something that feels like a recession. The cliff is so-called because a combination of expiring Bush tax cuts and required spending cuts could hit at the end of the year.
Industries that have been stalwarts in the recovery -- energy and automobiles -- may be about to stop growing. Drilling-rig counts are falling because of low natural gas prices in particular but falling oil prices as well.
One reality that seems to be emerging: Profit growth is slowing. Thomson Reuters says negative preannouncements are ahead of positive preannouncements by 3.6-to-1. That's the weakest showing since the third quarter of 2001.
|Markets for the week|
|6/29/2012||6/15/2012||% chg.||YTD chg.|
|U.S. Dollar Index||81.75||82.44||-0.84%||1.53%|
Here's what the week ahead looks like:
The ISM Manufacturing report, due Monday: Look for a slide to a reading of about 50. That will reflect the cool-down that hit the economy this spring.
Construction spending, due Monday from the Commerce Department. Expect a small gain, largely because of apartment construction. Government spending will fall for the sixth straight month.
Auto and truck sales, due Tuesday. The expectation is for continued strength, although sales haven't been as strong as earlier this year. The consensus on auto sales is a seasonally adjusted annual rate of 13.9 million units, up slightly from May. Watch for a negative surprise. There have been anecdotal reports of slowing sales since Memorial Day. Truck sales may decline because of slowing in the oil patch.
ISM Non-Manufacturing Index, due Thursday. The last index reading came in at 53.7. Look for something closer to 53. Europe is the problem.
Jobless claims, due Thursday. Look for 385,000 new claims for the week ended June 30, the same as the week of June 23.
Payrolls and unemployment, due Friday from the Labor Department. The consensus estimate is for a gain of 90,000 jobs in June, but there are many people who see 75,000 or less. Private-sector growth is stalling; public sector jobs are slumping. The unemployment rate should hold at 8.2%.
People may have noticed, scumbags in control now and selling on any rally attempted, that's why we cant improve...Oh well, we will see what happens this afternoon.
We may not agree with the right-wing ideas, but we'll defend your right to free speech.
MSN, goScr@tch. I'll was-te my time where I can debate.
Go ahead mod, thumb me down and delete me. I don't care - this place has only gotten worse over the past few years with censorship. You and I know you are a right winger mod. Other right-wingers don't see it - too bad.
was a lazy weekend ~ off to a local casino-resort for a fun time (near zero gambling, i'm cheap). was surprised to see on TV news forecasting of an economic calamidy ahead! I SELDOM see such pessimissim reaching regular TV!
must be really brewing when the regular TV channels seem to start talking about it
Chairman Marcus Agius resigned in a bid to shield Chief Executive Officer Robert Diamond after the bank was fined a record 290 million pounds ($455 million) for rigging interest rates.I am truly sorry,” Agius, who had been chairman of Britain’s second-largest bank by assets since 2007, said in a statement today.“
If you are TRULY sorry, sir... you will divest the corrupt behemoth and recommend a stop to the Too Big To Fail oligarchies worldwide. If you are big enough to manipulate the LIBOR, you have no right to further exist as you are.
This is a classic liquidity fueled rally."
None of the above replies... first, it's TRILLIONS and they are already out there. Add derivative contracts and the markets are rising because the value of the debt rises and the currency falls. When President Obama once said: "Don't look at the markets as a measure of the economy..." this is what he was referring to. Dubya had already set us up to fail this way. Wealth holds those contracts and expects us to pay them interest on them for generations to come.
There is nothing "classic" about these rallies other than history is repeating itself. This is exactly what happened during the French Revolution Era.
Chairman Marcus Agius resigned in a bid to shield Chief Executive Officer Robert Diamond after the bank was fined a record 290 million pounds ($455 million) for rigging interest rates.
I am truly sorry,” Agius, who had been chairman of Britain’s second-largest bank by assets since 2007, said in a statement today. “Last week’s events, evidencing as they do unacceptable standards of behavior within the bank, have dealt a devastating blow to Barclays’s reputation.”
John Sunderland, a Barclays director and former chairman of Cadbury Schweppes Plc, will oversee a search for a replacement, the London-based lender said. Michael Rake will become deputy chairman. Agius, 65, will remain in his position until his replacement is appointed.
Mississippi passed a law that says abortions can only be done by a licensed OB/GYN. The law is enacted and a judge shuts it down right away. Is the issue the premise? Nope. The issue is- the GOP are force-controlling us to their agenda. A democratic solution occurred, while a Facist force commended otherwise. I don't know about you... but I am tired of old men pushing the New World Order agenda down our throats. Do you really know what you are invested in? If a brand no longer has the Founder at the helm and the hired-in management profits from market moves not sales and prosperous growth, are they not really a business, just yet another type of casino. Personally, I never gamble with money I can't afford to lose and expect to. I own no stocks right now, because I can't afford to lose my money at the casino.
SANDUSKY : PATERNO
It is now too late for the inner child of U.S. citizens.
What if you have less users because you decide that people's opinions can't be written here?
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[BRIEFING.COM] The S&P 500 ended this week with a bang, roaring to a new all-time high on the back of stronger-than-expected economic data, influential leadership, and an ongoing appreciation for the Fed's monetary policy support.
The bullish bias was evident in premarket action as the S&P futures pointed to a higher start without the benefit of any definitive news catalyst. Stocks indeed benefited from a blast of buying interest at the opening bell on this ... More
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All hail the bull market, which ended the week with a big rally. But it also is starting to look a little like 1987, which suffered an epic blow-out.