Best of the Week
Most Popular
1. Gold vs Cash in a Financial Crisis - Richard_Mills
2.Current Stock Market Rally Similarities To 1999 - Chris_Vermeulen
3.America See You On The Dark Side Of The Moon - Part2 - James_Quinn
4.Stock Market Trend Forecast Outlook for 2020 - Nadeem_Walayat
5.Who Said Stock Market Traders and Investor are Emotional Right Now? - Chris_Vermeulen
6.Gold Upswing and Lessons from Gold Tops - P_Radomski_CFA
7.Economic Tribulation is Coming, and Here is Why - Michael_Pento
8.What to Expect in Our Next Recession/Depression? - Raymond_Matison
9.The Fed Celebrates While Americans Drown in Financial Despair - John_Mauldin
10.Hi-yo Silver Away! - Richard_Mills
Last 7 days
Coronavirus China Infection Statistics Analysis, Probability Forecasts 1/2 Million Infected - 21st Feb 20
Is Crude Oil Firmly on the Upswing Now? - 20th Feb 20
What Can Stop the Stocks Bull – Or At Least, Make It Pause? - 20th Feb 20
Trump and Economic News That Drive Gold, Not Just Coronavirus - 20th Feb 20
Coronavirus COVID19 UK Infection Prevention, Boosting Immune Systems, Birmingham, Sheffield - 20th Feb 20
Silver’s Valuable Insights Into the Upcoming PMs Rally - 20th Feb 20
Coronavirus Coming Storm Act Now to Protect Yourselves and Family to Survive COVID-19 Pandemic - 19th Feb 20
Future Silver Prices Will Shock People, and They’ll Kick Themselves for Not Buying Under $20… - 19th Feb 20
What Alexis Kennedy Learned from Launching Cultist Simulator - 19th Feb 20
Stock Market Potential Short-term top - 18th Feb 20
Coronavirus Fourth Turning - No One Gets Out Of Here Alive! - 18th Feb 20
The Stocks Hit Worst From the Coronavirus - 18th Feb 20
Tips on Pest Control: How to Prevent Pests and Rodents - 18th Feb 20
Buying a Custom Built Gaming PC From Overclockers.co.uk - 1. Delivery and Unboxing - 17th Feb 20
BAIDU (BIDU) Illustrates Why You Should NOT Invest in Chinese Stocks - 17th Feb 20
Financial Markets News Report: February 17, 2020 - February 21, 2020 - 17th Feb 20
NVIDIA (NVDA) GPU King For AI Mega-trend Tech Stocks Investing 2020 - 17th Feb 20
Stock Market Bubble - No One Gets Out Of Here Alive! - 17th Feb 20
British Pound GBP Trend Forecast 2020 - 16th Feb 20
SAMSUNG AI Mega-trend Tech Stocks Investing 2020 - 16th Feb 20
Ignore the Polls, the Markets Have Already Told You Who Wins in 2020 - 16th Feb 20
UK Coronavirus COVID-19 Pandemic WARNING! Sheffield, Manchester, Birmingham Outbreaks Probable - 16th Feb 20
iShares Nasdaq Biotechnology ETF IBB AI Mega-trend Tech Stocks Investing 2020 - 15th Feb 20
Gold Stocks Still Stalled - 15th Feb 20
Is The Technology Stocks Sector Setting Up For A Crash? - 15th Feb 20
UK Calm Before Corona Virus Storm - Infections Forecast into End March 2020 - 15th Feb 20
The Growing Weaponization of Space - 14th Feb 20
Will the 2020s Be Good or Bad for the Gold Market? - 14th Feb 20
Predictive Modeling Suggests Gold Price Will Break Above $1650 Within 15~30 Days - 14th Feb 20
UK Coronavirus COVID-19 Infections and Deaths Trend Forecast 2020 - 14th Feb 20
Coronavirus, Powell and Gold - 14th Feb 20
How the Corona Virus is Affecting Global Stock Markets - 14th Feb 20
British Pound GBP Trend and Elliott Wave Analysis - 13th Feb 20
Owning and Driving a Land Rover Discovery Sport in 2020 - 2 YEAR Review - 13th Feb 20
Shipping Rates Plunge, Commodities and Stocks May Follow - 13th Feb 20
Powell says Fed will aggressively use QE to fight next recession - 13th Feb 20
PALLADIUM - THIS Is What a Run on the Bank for Precious Metals Looks Like… - 13th Feb 20
Bitcoin: "Is it too late to get in?" Get Answers Now - 13th Feb 20
China Coronavirus Infections Soar by 1/3rd to 60,000, Deaths Jump to 1,367 - 13th Feb 20
Crude Oil Price Action – Like a Coiled Spring Already? - 13th Feb 20
China Under Reporting Coronavirus COVID-19 Infections, Africa and South America Hidden Outbreaks - 12th Feb 20
Will USD X Decline About to Trigger Precious Metals Rally - 12th Feb 20
Copper Market is a Coiled Spring - 12th Feb 20
Dow Theory Stock Market Warning from the Utilities Index - 12th Feb 20
How to Get Virgin Media Engineers to FIX Hub 3.0 Problems and NOT BS Customers - 12th Feb 20
China Under Reporting Coronavirus COVID-19 Infections by 66% Due to Capacity Constraints - 12th Feb 20
Is Coronavirus the Black Swan That Takes Gold To-Da-Moon? - 12th Feb 20
Stock Market 2020 – A Close Look At What To Expect - 12th Feb 20
IBM AI Mega-trend Tech Stocks Investing 2020 - 11th Feb 20
The US Dollar’s Subtle Message for Gold - 11th Feb 20
What All To Do Before Opening A Bank Account For Your Business - 11th Feb 20
How and When to Enter Day Trades & Swing Trade For Maximum Gains - 11th Feb 20
The Great Stock Market Dichotomy - 11th Feb 20
Stock Market Sector Rotation Should Peak Within 60+ Days – Part II - 11th Feb 20
CoronaVirus Pandemic Stocks Bear Market Risk 2020? - Video - 11th Feb 20

Market Oracle FREE Newsletter

Nadeem Walayat Financial Markets Analysiis and Trend Forecasts

Underwhelming Jobs Numbers See Stocks Trim Gains

Stock-Markets / Stock Markets 2010 Jun 03, 2010 - 10:14 AM GMT

By: PaddyPowerTrader

Stock-Markets

Best Financial Markets Analysis ArticleIn another late late show Wednesday US stocks, as I expected, rebounded from oversold levels in the last hour of trading because of stronger than expected home sales (buyers took advantage of the now expired tax credit), decent auto sales numbers and a read on the Challenger layoffs survey which implied underlying jobs growth of 200k. Other contributing factors were the calm on the bad news from Europe front and comments from Bank of America CEO Brian Moynihan that he saw “more than hopeful signs” on loan demand.


The standout movers were the recently battered oil names as investors speculated the drop in energy shares had overshot risks from the Gulf of Mexico oil spill & went “bargain hunting “, Halliburton and Schlumberger rose at least 8% after being named short-term buys by Morgan Stanley, and eight of the 10 best performers in the S&P 500 Index were energy companies. Amgen rose 11% after the FDA approved a bone-strengthening injection treatment.

Today in Europe we’ve seen similar themes with BP up 2% despite rating agency Fitch’s cutting its credit rating a notch to AA and talk of crown forced asset sales of some of their crown jewels to fund the big clean up). Shell is ahead by 1.6% and Total better by 3.5% on the view they’ve overshot to the downside. Basic resources and mining stocks are better bid on the rebound in copper prices. Peugeot is 5.5% to the good this morning on a broker upgrade from Deutsche bank to a “buy” to a “hold”. And Daimler is better by 2% after US auto sales numbers showed its Mercedes units sales had risen 23%. Staying in the autos space, car parts manufacturer Valeo of France surged 7%+ after forecasting a 35% increase in H1 profits. And finally Air France is having a good day, up 6% after reporting a 4.3% rise in passenger traffic numbers for May. For me though the seemingly half hearted and half baked buying of euro peripheral bond markets by euro area central banks is a worry in that it seems to be drying up. Spreads versus Germany are wider again today for the PIIGS and sooner or later this is again going to spook equities.

Stateside we’ve just that the ADP private sector jobs report which as a warm up or the biggie Non Farm payrolls Friday proved a bit of a damp squib coming in at an underwhelming +55k. The market had been looking for +70k. This combined with a disappointing continuing claims number has seen markets trim some of their earlier gains. Stocks on the move pre market include Alcoa buoyed by the general better tone towards basic resource stocks and a broker upgrade from Aussie house Macquarie to “outperform” from “neutral”. Citigroup is also bid on news of a plan to move bad loans to a new unit from its US consumer finance business that will make the remaining network profitable.

Today’s Market Moving Stories

•Come every June, markets tend to quieten down. One reason is the CFA exams, which this year is drawing a record 140k candidates many of them working on our markets. At the same time, there is a marked lull just now in the newsflow. With the times that are in it, no news is good news these days. So this lull favours a rebound in risk appetite and higher yields.
•Euro area retail sales came in surprisingly weak in April data released today showed, recording a decline of 1.2% m/m (counter to market expectations for a rise of 0.1% m/m). Although there was confirmation of an upwards revision to the March reading (0.5% m/m, from a previously reported 0.0% m/m), the net news in this report is unambiguously negative, with the April level of sales standing 0.9% below the Q1 average.
•Today’s May UK CIPS/Markit report on the services sector provides further evidence that the recovery in the biggest part of the economy is struggling to pick up either steam or traction. The business activity index edged up only marginally from 55.3 to 55.4, suggesting that April’s drop was not just a temporary result of the disruption caused by that volcanic ash cloud. Admittedly, the index still points to fairly decent quarterly growth of services sector output of about 0.5%. But given that the relationship with the official data has broken down recently (with services output still estimated to have risen by just 0.2% in Q1), I wouldn’t hold out hope for a much stronger figure in Q2.
•Another day and yet more signs of consolidation in Iberian banking with Caja Murcia leading the merger of another four Spanish saving banks. This will be the largest merger ahead of the 30 June deadline to tap the government rescue fund and create a lender with €73bn in assets.
•As it looks certain that some version of the so-called Volcker rule will make it into the financial reform package being prepared by the U.S. Congress. Paddy Hirsch explains what the Volcker rule is.

US Auto Sales Up Again

The WSJ reports that US auto sales rose for the seventh month in a row in May on the strength of big gains by most car makers, including hard-hit Chrysler and renewed popularity for some large trucks and sport-utility vehicles. Sales of cars and light trucks jumped 19% in May, to 1.1 million vehicles, according to Autodata. The annualized sales pace for the month was 11.68 million vehicles. That’s up from the year-ago figure of 9.86 million and April’s 11.2 million rate. General Motors, Ford, Honda and Nissan all reported sales increases ranging from 17% to 24%. But Chrysler, which has been struggling to boost sales since its bankruptcy reorganisation last year, outpaced them all, reporting a rise of 33%. The company sold 104,819 vehicles in May, the first time in 14 months it surpassed the 100,000 mark. Korea’s Hyundai matched Chrysler’s growth rate, as its sales also rose 33%, to 49,045 vehicles. Toyota, hobbled by its recalls for sudden acceleration, was one of the few laggards. Its sales grew just 6.7% to 162,813 vehicles after it pared back some sales incentives. But it said it planned to continue incentives this month. In another positive note for the industry, sales of certain trucks and SUVs, which generate big profits, rose significantly, perhaps driven in part by recent declines in the price of gasoline.

Company / Equity News

•Pacific Investment Management Co (PIMCO), which runs the world’s biggest mutual fund, recently cut its gold holdings in half in its multi-asset products, Co-Chief Investment Officer Mohamed El-Erian said. Gold may weaken as the result of “deleveraging” among borrowers worldwide, El-Erian said. Investors should favour high-quality government bonds as a source of income and “stay on the sidelines” with regard to equities amid concerns about European sovereign debt.
•But BlackRock’s Laurence D. Fink, who leads the world’s biggest asset management firm, said the stock market is poised to rally because US companies have built cash reserves and manufacturers are returning to health. “We’re ready to really rock and roll as a country,” Fink said.
•Maybe Paddy Power should open a book on this guy as well (or a double with BP CEO). Prudential’s CEO Tidjane Thiam spent three months failing to persuade investors to pay $35.5 billion for AIA Group. Now he has to convince them that he should keep his job. Thiam, 47, dropped his attempt to win shareholder support for the company’s biggest takeover yesterday and agreed to pay a £152.6 million breakup fee to AIG.
•The FT market report this morning suggested that the 5% increase in the Tate & Lyle share price yesterday reflected bid speculation that Bunge, a US based sugar trader, would make a bid for Tate. Apart from the equity price reaction, suggestions that Harbinger would be a willing seller of Tate stock and Bunge’s unsuccessful all share bid for a US corn producer in 2008 provided additional reasons to consider that a bid is possible.
•The WPP owned media buyer, Group M, sharply improved their outlook for the UK advertising market, making a particularly sharp increase to forecasts for TV advertising. Group M raised its forecast on the overall market from flat to 4.2% and on TV advertising from a slight decline to 12%. Current market consensus for ITV revenue growth is mid single digit, which assuming that the UK’s largest broadcaster gets at least its fair share of this increase may prove somewhat conservative. When allied to ITV’s very high operational gearing, this forecast, should it be borne out, may prove to be a significant boon to the stock.
•Kingfisher (the owner of B&Q) delivered retail profit for the quarter of £146M slightly ahead of expectations and 12% up on a constant currency basis reflecting the beneficial impact of cost cutting measures. Sales were slightly down on a constant currency basis and the Group two main operating segments, France and UK and Ireland, posted like for like revenue growth of 0.2% and a decline of 2.8% respectively as consumer demand remained muted both by the weather and economic conditions.
•Xstrata, the world’s largest thermal coal exporter, shelved spending on projects worth A$6.6 billion in Australia, intensifying pressure on the government to wind back its proposed tax on mine profits.
•Kerry Group has decided to raise raw milk prices in Ireland to 30c a litre as international dairy markets and a strong dollar help pricing. For farmers this is a 35% lift in prices from the lows of 2009 and marks a material improvement in a faming activity that is core to Irish agriculture.

By The Mole
PaddyPowerTrader.com

The Mole is a man in the know. I don’t trade for a living, but instead work for a well-known Irish institution, heading a desk that regularly trades over €100 million a day. I aim to provide top quality, up-to-date and relevant market news and data, so that traders can make more informed decisions”.© 2010 Copyright PaddyPowerTrader - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

PaddyPowerTrader Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules