Markets face important reports after Sandy
Exchanges won't reopen until Hurricane Sandy makes landfall. Look for a Wednesday reopen. Insurance companies could see $5 billion to $10 billion in losses. Important economic and earnings reports are due, including Friday's jobs report.
U.S. stock and bond markets will be closed again Tuesday because of the worry of the havoc Hurricane Sandy will cause around the New York metro area.
The move was expected because markets were closed today before Sandy even made landfall over New Jersey. Markets probably will reopen Wednesday as the storm moves inland. The eye of the storm is supposed to move into central Pennsylvania and then through New York state and New England and then into Ontario and Quebec.
Wednesday will not only be Halloween but the end of the month. Moreover, this week is one of the heaviest for earnings, and it ends with the October unemployment report, which could have a big impact on the election.
As of Friday, the Dow Jones industrials ($INDU) were down 2.5% for the month, with the Standard & Poor's 500 Index ($INX) down 2% and the Nasdaq Composite Index ($COMPX) down 4.1%.
The storm was expected to generate winds of 85 MPH or more, heavy rain and flooding. They markets haven't reduced hours for weather reasons since Jan. 8, 1996, when a blizzard dumped more than 20 inches of snow on the New York metropolitan area. Markets haven't had a multi-day shutdown that didn't include a holiday since the Sept. 11, 2001, terror attacks.
Article continues below.What isn't known is how much damage will be done by the storm. Flooding and power outages are expected along with wind damage to homes and businesses. Corelogic, a real estate research firm, says some $87 billion in properties are exposed to the storm, including some of the most valuable residential real estate in the country.
The storm is likely to cause insured losses of $5 billion to $10 billion and economic losses of $10 billion to $20 billion, disaster modeling company Eqecat said today.
How much it affects the economy is complicated by a number of factors, including:
- How long it takes the storm to pass: Longer is bad.
- How fast recovery and reconstruction efforts begin. The faster the better. Look for strong sales for hardware stores, auto dealerships, paint dealers and furniture dealers over the next few months as claims are settled.
- How fast power is restored. Not just to homes but especially to the oil refineries in Delaware, Pennsylvania and New Jersey. Long shut downs in refineries can create short-term shortages and boost fuel prices not just regionally but nationally as well.
- How fast the local infrastructure is put back into shape, including water, sewers and streets and highways. Of special interest in the Northeast are suburban rail networks. Heavy rains can weaken rail beds and slow speeds at which trains can run.
Futures trading had suggested a weak open for U.S. stocks today, if the markets had operated normally. A weak open would have reflected worries from Europe that property-insurance companies may face big damage claims from the storm. In addition, worries about economic conditions weakened markets in France, Spain and Italy.
Meanwhile, gold (-GC) and crude oil (-CL) prices fell ahead of market closures. The national average price of gasoline was $3.575 a gallon, down from $3.579 on Sunday and $3.814 a gallon on Oct. 5, according to AAA's Daily Fuel Gauge report.
The market closures raise the potential for volatile swings once trading resumes.
There are important economic reports this week, including personal income for September today. The government said incomes rose 0.4%, the best increase since March. Spending rose 0.8% in September; however, spending adjusted for price increases was only up 0.4%. The saving rate fell to 3.3% in September, from 3.7% in August.
Other reports include:
Tuesday: The S&P/Case-Shiller home price index.
Wednesday: the ADP National Employment Report, a measure of employment trends and the Chicago Purchasing Managers Index.
Thursday: Initial jobless claims from the Labor Department, Layoffs from Challenger Gray & Christmas; the Institute for Supply Management's Manufacturing Index; and auto and truck sales; and the Conference Board's Consumer Confidence Index. This was rescheduled from Tuesday.
Friday: The jobs report and the September report on Factory Orders.
- For more, check MSN Money's economic report calendar.
In addition, this is a heavy week for earnings. Some, like Pfizer (PFE), have postponed their reports.
Pfizer postponed its earnings release from Tuesday to Thursday. So did Martha Stewart Living Omnivision (MSO). Thomson Reuters (TRI) moved its report from Tuesday to Friday.
Burger King (BKW) and Red Robin Gourmet Burgers (RRGB) reported as scheduled today. Burger King reported an 83% earnings decline due to restructuring and currency effects on results.
Red Robin reported 24 cents a share in earnings, up from 14 cents a year ago. But compared with earnings after one-time restructuring charges, earnings were flat.
higher profit margins.
Also due to report this week:
Cummins (CMI), UBS (UBS), Ford Motor (F), General Motors (GM), Exxon Mobil (XOM), Kellogg (K), Starbucks (SBUX) and Chevron (CVX).
- Check MSN Money's earnings calendar for when your company reports.
Friday big jobs report......WWHHOOOPPPIES Pooooh wonder who won't get counted this week?
It has become a joke.
An interesting consequence to hurricane Sandy... a thousand miles in diameter is-- that it has reached the Great Lakes and our shorelines. Winds sustaining 50 mph are removing all our tree leaves and sending them toward Wisconsin. Waves are as high as I've ever seen them and small boats still in marina slips are taking a beating. Many freighters working into Lake Huron for the winter are realizing a rare easterly push toward shallower and rockier shores. This would be the kind of weather that split the Edmund Fitzgerald in two... high wave crests that expose the hard bottoms as deep as 50 feet in the Straits. This is a full-blown storm about to move across land that rarely sees one of these.
One thing people should know... the President is in the White House today. He declared NYC a state of disaster late last night. Congress is STILL on vacation. Many members are in Texas and California nowhere near DC.
Well they got plenty of problems and water/flooding along with power outages are going to be a major problem for over a week, worst in some areas.
The fires they had in some places,were quite bad, couldn't get to them because of flooding...
How ironic..."Water,water everywhere and not...."
Thought it was admirable that Gov.Christie complimented Obama and FEMA for their reactions.
So far I think the actions of the Administration are "excellent" with a lot of work to get done.
Clearing/cleaning pathways and getting power back up...will be a chore.
The Gov. of Jersey and Mayor of Atlantic City....got a little pissing match going..Oh well.
All judgements should be reserved for a few weeks out...They have a mountain of work to get through, and they all need to do it together, including the citizens.
Come on, America... vote all Republicans out and don't let any new ones in.
Pretty sure in our Constitution....It "states and is directed towards" the Central Government or the Federal G. as we address today.
"to insure domestic Tranquility,"
"to provide for the common defence,"
"promote the general Welfare,"
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[BRIEFING.COM] S&P futures vs fair value: +1.90. Nasdaq futures vs fair value: +3.00. The stock market is on track for a flat open with futures on the S&P 500 trading within two points of fair value.
Barring any unforeseen developments, today's session is setting up to be relatively quiet after the first two trading days of the week generated the two lowest volume totals of the year. Action overseas has also been subdued today with core European indices trading near their ... More
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