US Equities Continue Yesterday's Rally
Today's financial recap and tomorrow's financial outlook.
The World Bank upgraded its growth forecasts for 2014 this morning. It now sees global growth at 3.2% year-to-year from its estimate of 3.0% in June of last year. The World Bank warned that emerging market economies could see capital flows drop by 80% if developed markets’ central banks moved too quickly with regards to removing monetary stimulus. If the removal caused rapid interest rate adjustments, countries with large current account deficits or high local debt levels would be most vulnerable to slowdowns. Its developing countries forecast was lowered to 5.3% from 5.6% in June, the EU was raised to 1.1% from 0.9%, and China was cut to 7.7% from 8%.
US equities continued their rally from yesterday. The S&P 500 (INDEXSP:.INX) and Russell 2000 (INDEXRUSSELL:RUT) broke to new record highs. The former rose 0.52%. The S&P was led by strong performances from telecom, tech, and financial stocks. Financials were buoyed by strong fourth-quarter results from Bank of America (NYSE:BAC). Energy-, health care-, and utility-sector stocks all declined.
December US producer prices rose 1.2% from a year ago, breaking their two-year trend of falling prices. The economist estimate had been for a 1.1% increase, up from 0.8% in the month prior. The New York regional manufacturing survey rose to an index reading of 12.51 in January, up significantly from 2.22 in the month prior. The survey showed strong gains in new orders, employment, and unfilled orders, all of which indicate strong activity in the new year.
Crude oil futures rose 1.68% after weekly inventories saw a surprise draw of 7.7 million barrels vs. an estimated draw of 673,000, according to the DoE. Last night’s API inventories saw a draw of 4.14 million barrels, which caused some positive momentum in overnight trading.
Riverbed (NASDAQ:RVBD) rejected the $3.08 billion acquisition offer from Elliott Management that would have amounted to $19 per share. Riverbed saw the offer as undervaluing the company and not in the best interest of the shareholders. The stock added another 1% in today’s trading, closing at $20.25.
The US will release the December 2013 consumer price index tomorrow morning. Economists estimate that prices rose 1.5% from a year ago after rising 1.2% in the month prior. Also scheduled for the morning is November 2013 TIC flows and the Philadelphia regional manufacturing survey. Lastly, the NAHB survey of builder and real estate agent sentiment for January will be released in the late morning.
December 2013 eurozone consumer price inflation will be released tomorrow morning before the US markets open. The final estimate of inflation is expected to remain unchanged at 1.8%. Also on the schedule is Australia’s employment change and Japanese machine orders.
Fourth-quarter earnings reports will pick up tomorrow. Notable companies scheduled to report are Charles Schwab (NYSE:SCHW), BB&T (NYSE:BBT), BlackRock (NYSE:BLK), Goldman Sachs (NYSE:GS), Citigroup (NYSE:C), Capital One (NYSE:COF), American Express (NYSE:AXP), Intel (NASDAQ:INTC), and PNC Financial (NYSE:PNC).
Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.
Copyright 2011 Minyanville Media, Inc. All Rights Reserved.