Stocks gain on US consumer data
Reports on sentiment and spending top estimates. Apple shares slide. Finance ministers agree to bolster the eurozone's debt crisis firewall. Gold and oil gain.
By Andrea Tse
Updated at 1:01 p.m. ET
Stocks were rising Friday as investors weighed improvements in consumer spending and an agreement to boost the eurozone's rescue fund against weakness in the tech sector.
The Dow Jones Industrial Average ($INDU) was rising 52.7 points at 13,198. The S&P 500 ($INX) was rising 4.9 points at 1,408 and the Nasdaq ($COMPX) was adding 1.7 points at 3,096.
With the first quarter coming to an end, the stock market is headed for its best first quarter since 1998. The S&P, which has increased 12% so far this quarter, has only seen double digit first-quarter gains eleven times since 1928.
In U.S. economic news, the Commerce Department said personal incomes rose 0.2% in February, falling short of expectations for a 0.4% increase. Personal spending rose 0.8%, topping forecasts for 0.6%.
"As we already had the monthly employment report, we knew that earnings and hours rose in February, suggesting a healthy enough gain for wages and salaries," says Dan Greenhaus, strategist with BTIG. "While people are making more money, they aren't receiving less support from the government. This has no doubt been a boost to consumption."
The Federal Reserve Bank of Chicago's purchasing managers index came in at 62.2 in March, less than the 63 expected and the previous month’s figure of 64.
The University of Michigan's survey of consumer sentiment reached its highest level in more than a year in March, rising to 76.2 from 75.3 in February. Economists had expected the index to come in at 74.7.
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Eurozone finance ministers have agreed to strengthen the single-currency bloc's debt crisis firewall to about 800 billion euros ($1.1 trillion), said Austrian Finance Minister Maria Fekter, before a meeting of European finance ministers in Copenhagen. While the eurozone seeks to protect Italy and Spain from the pains of the debt crisis, eurozone leaders have agreed on the lowest figure accepted by nations including Germany, Finland and the Netherlands, where the public has frowned upon additional funding for bailouts.
Some 500 billion euros of that money would come from the permanent, European Stability Mechanism when it becomes available in July, and 200 billion euros is coming through the European Financial Stability Facility. A further 53 billion euros will be derived from bilateral loans that have been made available to Greece and 49 billion euros from the European Financial Stability Mechanism.
London's FTSE finished with a 0.46% gain and Germany's DAX added 1.04%. In Asia, Japan's Nikkei Average closed down 0.3% and Hong Kong's Hang Seng index finished lower by 0.3%.
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In corporate news, Research In Motion (RIMM), the troubled BlackBerry maker, missed fourth-quarter analysts' expectations, said it would no longer provide quarterly forecasts, and announced former co-CEO Jim Balsillie is resigning from the board. RIM posted fiscal fourth-quarter non-GAAP earnings of 80 cents a share on revenue of $4.2 billion. Analysts were expecting profit of 81 cents a share on revenue of $4.5 billion.
Dunkin’ Brands Group (DNKN), the owner of Dukin’ Donuts and Baskin-Robbins, announced a public offering of 26.4 million shares of common stock at $29.50 a share. There will also be a 30-day option to sell an additional 3.96 million shares from some of the stockholders selling.
A labor advocacy group released the findings of an audit of working conditions at Foxconn, a major Apple (AAPL) supplier in China. Apple CEO Tim Cook visited a Foxconn facility in China on Thursday, and Foxconn reportedly has promised to make improvements, but it's not clear how this may or may not impact the company's relationship with Apple, which is part of the Fair Labor Association that conducted the audit.
May oil futures were rising 50 cents to $103.28 a barrel, while June gold futures were adding $9 to $1,663.90 an ounce.
The benchmark 10-year Treasury was rising 4/32, diluting the yield to 2.152%, while the U.S. dollar index was down 0.29% to $78.958.
Any elected Politician, anywhere and any office....Local to the top POTUS.....
Should be limited to not more then 20 years in office total...All positions.
Then come home or go home.........To live off the "same" benefits that all Americans live off.
Pensions adjusted to income, health plans averaged, Soc. Sec. and Medicare.
Then and only then, will they strive to better the working and retirement lives of Americans.
BECAUSE they will be partaking of the same system.....Same for Public employees..But no 20yrs. and out.........
As far as health care, what is the ultimate goal? There are between 10 million and 40 million with no health insurance. Some so choose, others cannot afford the premiums. All have access via ER, but this is not the best solution, as well all agree. If the main issue to access is cost, the 2700 pages our wonderful congress has put forth and passed (against the will of most of the populace - giving birth to the tea party I might add) will not lower the cost or solve the problem.
The medical delivery system has been turned upside down to the point that market forces are not allowed to function. No one knows the cost of any treatment anymore so there is no competition for services. Insurance does not cover plastic surgeries causing Doctors to compete and the prices have come down to where (prior to the recession) there exists a thriving market.
Salary of retired US Presidents .............$180,000 FOR LIFE
Salary of House/Senate ..............................$174,000 FOR LIFE
Salary of Speaker of the House .............$223,500 FOR LIFE
Salary of Majority/Minority Leaders ...$193,400 FOR LIFE
Average Salary of a teacher .................. $40,065
Average Salary of Soldier deployed in Afghanistan .......... $38,000
There is a downside to term limits - politicians can become dangerous creatures if they have nothing to lose and no re-election to worry about
The whole point of term limits WITH OUT ANY RETIREMENT BENEFITS is to insure that these legislators know they have to come home to live and work in the same environment THEY CREATE FOR THE REST OF US.
And how could they be more dangerous than they are now.....they ARE laying, very rapidly, the ground work for the economic COLLAPSE of the United States. Pretty hard to be MORE dangerous than that.
WHAT IS YOUR SOLUTION TO CREATING JOBS, ENDING THE RECESSION, FIXING HEALTHCARE FOR THE UNINSURED AND REDUCING WELFARE, POVERTY AND HUNGER HERE IN THE US?
1. Eliminate ALL TAXES on income from every source and all fees, exices taxes, etc. and institute "THE FAIR TAX". (read about it).
2. Pass "TERM LIMITS" with NO BENIFITS for all congressmen and senators.
3. Balance the budget imediatlely......
A. End ALL foreign aid
B. End ALL subsidies.....ALL of them, Corporate, personal, agricultual....ALL of them
C. Bring home ALL American troops from around the world.....NOW. Let the rest of the world defend itself.....and make sure we are SO STRONG nobody dares provok us and if they do let THEM pay a horrible price for it.....NOT US.
D. Eliminate the EPA. Dept. of education, Dept. of energy, and EVERY duplicated agency!
E. Then cut whatever percentage it takes from EVERY federal agency to bring out go 10% below income and use the difference to PAY DOWN ON THE DEBT.
4. Pass "looser pays" tort reform.
These reforms would free up euntripenureal energy, create millions of jobs, and bring great POTENTIAL PROPERTY to any able bodied man or woman. Potential because there will still be those who CHOOSE to look for that "something for nothing" life style. Liberal or conservative ideas will NOT help the un help-able. But there WILL be more wealth to share with the TRULEY unfortunate people the were born with, or put in situations beyond their control and need help.
Of course there are the results of money creation. It is called inflation. In 1976 a new car was 6,000, today it is 24,000 or 400% more. Printing money devalues savings. It punishes savers and rewards debtors.
Last year M2 increased 10.7%. So far this year its up 2.7%, and over the last 3 years it has increased 34%. If you create 34% more dollars in 3 years that means REAL inflation is running at 11% a year. It may take time to show up in the market, but it will. Some say the Fed can reduce the money in circulation, but they never have.
In short, in such an environment don't be invested in bonds, CD's or cash. Buy Specie, Stocks or even land/real estate. Being in debt to buy commodities makes a lot of sense also, if interest rates remain low.
Prices of most items have gone up regardless of what the Fed says. Visit Home Depot, Best Buy, your local gas station, or any food store...
People need to demand at least 11% interest just to keep from being devalued out of their savings. This is why gold continues to saty north of $1600/oz. Even real estate will come back in a hyper-inflationary environment. But it's true value will be in inflated dollars.
Some 500 billion euros of that money would come from the permanent, European Stability Mechanism when it becomes available in July, and 200 billion euros is coming through the European Financial Stability Facility. A further 53 billion euros will be derived from bilateral loans that have been made available to Greece and 49 billion euros from the European Financial Stability Mechanism.
Sounds like borrowing from Peter to pay Paul as fast as possible because he caught you diddling his sister in Peter's mom's house, on the bed that she borrowed from Paul's dad, who's now serving time after robbing Peter's uncle, who loaned money to Paul's grandfather, who served in the war with Peter's mom's 2nd cousin, who borrowed money to buy a canoe rental business from Paul's great aunt, who had a secret lesbian affair with Peter's grandmother-in-law on the Titanic before it sank....Understand, that the average teacher works 8.5 months a year and if you pro-rate that salary, they actually earn 56,562... In Chicago, where the graduation rate is under 70%, the average is considerably higher (over 64K). The pro-rated pays is over 80K.
Teachers as a group are not underpaid considering that the average worker in the US makes considerably less...
trouble is most people are rather stupid (look at TV show ratings - who ARE these people?!?!?!?!).
trouble too is these stupid people vote. they don't know the why's and how's of inflation, they just say "hey - my house value is back!" and are totally happy with that!
Even real estate will come back in a hyper-inflationary environment. But it's true value will be in inflated dollars.
Do you think possibly PI rose in February because of income tax returns? We all know that personal spending rose because of the increased cost of gasoline and food. Consumer Sentiment index is based on spending and we all spent more on gas. And yes, the consumer is back to tapping the savings account and using up what little credt he or she managed to rebuild from 2008.
The unemployment numbers always get adjusted upward after each initial report and the jobs on the market are paying less than 2008. In many cases the jobs created are minimum wage and those who have exhausted their unemployment benefits either take the minimum wage jobs or go without any income.
"U.S. stock futures were signaling a rebound at the open as eurozone finance leaders discussed ramping up the size of the eurozone's rescue funds and the market anticipated data indicating stronger spending by American consumers in February."
So here we go again...the market will go up today because Europe will take a page from the USA "Financial Playbook" and will pump a bunch of freshly minted money into their system to keep their market artificially hyped up. Then there is the "anticipated" data that Americans had strong spending in February. Just more hype considering the retail spending data includes gas prices which have risen by around 10% if not more and the price of other goods including food are up an average of 30%. Wal-Mart sales are flat at best, SEARS sales are down and they are closing over 100 stores, Best Buy sales are down and they are closing stores etc. etc. so don't believe the hype and manipulated numbers. But of course this market could care less about facts or fiction so the market will probably "soar" today on the good news!! Same old propaganda.
"The University of Michigan's survey of consumer sentiment reached its highest level in more than a year in March, coming in at an inde level of 76.2 from 75.3 in February. Economists expected the index to come in at 74.7."
This survey began back in the 1950's by a professor at the University of Michigan. Basically, they do a random telephone survey to 500 people throughout the USA. So before I would get too excited over this just look at how it is conducted, the methodology etc. as it is not a true representation of what the real consumer sentiment is in this country. The only thing worse would be if the 500 people they surveyed all worked on Wall St or were part of the 1 %'ers and of course they would all say things are great. Just more propaganda.
Jarlaxle,
Maybe cause my first boss was such a pr**k. I decided then and there I was going to start my own business and compete against him. I did. I got my grub stake to do that by going into the army, and saving my pay, and when I got out, I presented a business plan to a banker that basically laughed at me. Rather than get mad I asked him for advice. He was a wealth of knowledege. When I tired 18 months later he helped me put together a new business plan, and then shocked my by saying he couldn't give me the loan, but to try another bank, due to a conflict of interest. I did secure the loan and paid it off in 3 years. I guess you could say a bad boss provided the catalyst to suceed. I've been working hard ever since.
still seems to be the good old boys are still buying and selling the market. The average guy is still out. The volume has never been so low. As with all pyramid schemes you need new buyers
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[BRIEFING.COM] The S&P 500 settled lower by 0.8% after early strength turned into afternoon weakness.
Today's headline event came in the form of Ben Bernanke's testimony before the Joint Economic Committee. During his remarks, Chairman Bernanke said premature tightening of monetary policy could stall the pace of recovery. This followed weeks of conflicting remarks from FOMC members, which sparked speculation regarding possible changes to the Fed's policy course.
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