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U.S. GDP 0.7% But Good Internals – USD Stronger
The U.S. economy grew at a weak annualized growth rate at 0.7%, just below expectations, but perhaps it could have been worse after yesterday’s data. Core PCE is 1.2% as expected while the wide PCE is a miss with only 0.1%. The GDP deflator came out at 0.8% as predicted. Markets aren’t moving that much in the immediate aftermath. The internals of the GDP report are not so bad: inventories weigh.and they could be replenished in Q1 2016. Personal consumption is 2.2% against 1.8%. Here is the EUR/USD chart: The first release of US GDP for Q4 2015 was expected (see full EUR/USD preview) to show a poor annualized growth rate of 0.8%, belo... -
Finance 0
Crude – Is It Over? Or Just Another Fake-Out?
Crude has made a slight bounce, but it need desperately to close above $32.35 yesterday just to pause. There is no change of a real reversal in trend here. Crude would need to close above the $38.35 area. Our timing targets are still pointing to this week/New Week. If this turns out to be a reaction high, then a rout to the downside may yet be in the cards. We have a Monthly Bearish coming into play at $36.65, $35.13, $33.30 and a key one at $30.10 followed by $28.25. So we would have to close above $36.65 to avoid a sell signal.... -
Finance 0
Xerox Beat On Q4 Earnings, Revenues Lag
With operations in more than 180 countries, Xerox Corporation (XRX – Analyst Report) is a leader in the development, manufacture, marketing, servicing and financing of document equipment globally. Headquartered in Norwalk, Connecticut, this century-old firm has helped organizations transform the way they manage their business processes and information. XRX has beaten earnings estimates in two of the last four quarters, making for an average positive surprise of 3.9%. However, quite like its peers in the document industry, XRX is increasingly grappling with decreased demand for paper-related systems and products. With rising competit... -
Finance 0
Q4 GDP Advance Estimate At 0.7%, Down From Q3 Third Estimate
Written by Jill Mislinski The Advance Estimate for Q4 GDP, to one decimal, came in at 0.7 percent, down from the 2.0 percent for the Q3 Third Estimate. Today’s number was on par with most mainstream estimates, with Investing.com forecasting 0.8 percent and Briefing.com forecasting 0.7 percent. Here is an excerpt from the Bureau of Economic Analysis news release: Real gross domestic product — the value of the goods and services produced by the nation’s economy less the value of the goods and services used up in production, adjusted for price changes — increased at an annual rate of 0.7 percent in the fourth quarter of ... -
Finance 0
Gold Price Hits 3-Month High
From the beginning of the year there has been some anti-synchronisation between gold and the dollar, which usually have a strong negative correlation: as the dollar rises, the general rule is that gold falls and vice-versa. However, since the beginning of the year, the DXY and gold have developed a positive correlation by both being in upward channels. Although, if we take a shorter time frame on the graph, we can this golden dollar rule not being broken; since the start of this week, a rise in gold has meant a fall for the dollar. The DXY dollar index is in a horizontal channel between 98.17 and 99.80. The range is an upward heading one, ins... -
Finance 0
Dividend Aristocrats Part 52: Wal-Mart
Wal-Mart (WMT) generated revenues of $484 billion over the last 12 months. If Wal-Mart were a country (assuming revenue is about equal to GDP), it would be the 28th largest in the world. Compare Wal-Mart’s 12 month sales totals to its peers: Wal-Mart sales of $484 billion Target (TGT) sales of $74 billion Costco (COST) sales of $117 billion Amazon (AMZN) sales of $101 billion Wal-Mart generates 165% of the sales of Target, Costco, and Amazoncombined. Not only does Wal-Mart have more revenues than these 3 companies combined, it also has the highest profit margin. Target, Costco, and Amazon have a collective market cap of $408 billion (arou... -
Finance 0
EC What Follows The Most Epic “Reach For Yield” Episode In History?
A friend of mine just emailed me the chart below. Considering the fact that we just witnessed 7 full years of ZIRP (zero interest rate policy), I probably shouldn’t be surprised just how massive the investor migration into risk assets, like junk bonds and leveraged loans, has been. But I am. Some perspective on the recent boom in high-yield/leveraged loan markets: pic.twitter.com/uJw4rnIZkx — Jesse Felder (@jessefelder) January 27, 2016 Even after a significant reduction in new issuance, total high-yield assets are still well more than double their pre-financial crisis peak. And leveraged loans are still nearly triple their own prior peak... -
Finance 0
Honeywell Misses Q4 Earnings Despite Lower Costs
Global diversified technology and manufacturing firm Honeywell International Inc (HON – Analyst Report) has a balanced mix of long and short-cycle businesses. With a flexible yet disciplined focus on cost and productivity, HON remains focused on increasing its presence in high-growth regions. However, despite HON’s proactive restructuring initiatives, it is yet to witness signs of stabilization in a number of its major end markets. As the extent of competition is increasing over time, investors have been eagerly awaiting for the company’s latest earnings report. In the last four trailing quarters, HON has reported a posi... -
Finance 0
Mastercard Inc. Beats On EPS, Misses Sales, Chevron Posts Surprise Loss
Mastercard Inc (NYSE:MA) and Chevron Corporation (NYSE:CVX) released their latest earnings reports before opening bell this morning. MasterCard posted earnings of 79 cents per share and $2.52 billion in revenue. Analysts had been expecting earnings of 69 cents per share and $2.59 billion in revenue for the fourth quarter. MasterCard said acquisitions had a diluted impact of 3 cents per share during the quarter. Chevron reported an adjusted loss of 31 cents per share, compared to Wall Street’s estimate of 46 cents per share in earnings. The energy company’s revenue for the fourth quarter was $29.25 billion, compared to the consensus of $28... -
Finance 0
The FOMC Decision: The Boxed In Fed
An Imaginary Bogeyman What’s a Keynesian monetary quack to do when the economy and markets fail to remain “on message” within a few weeks of grandiose declarations that this time, printing truckloads of money has somehow “worked”, in defiance of centuries of experience, and in blatant violation of sound theory? In the weeks since the largely meaningless December rate hike, numerous armchair central planners, many of whom seem to be pining for even more monetary insanity than the actual planners, have begun to berate the Fed for inadvertently summoning that great bugaboo of modern-day money cranks, the “ghost of 1937”. The buga...
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