S&P 500 Le news di oggi (4 lettori)
- Creatore Discussione gipa69
- Data di Inizio
superbaffone
Guest
superbaffone
Guest
mi sono sempre chiesto perchè la bce volesse un euro forte penalizzando le esportazioni, ora la verità viene a galla, i debiti degli stati sono molto + importanti (causa la loro entità) delle esportazioni, andiamo bene.......
superbaffone
Guest
in america almeno questo lo sanno, al primo posto ci stanno le vendite perchè se un'azienda non vende poi alla fine chiude.....
f4f
翠鸟科
ah
allora capisco perchè il dollaro sale sull'euro ,
gli USA non sono indebitati nè hanno disavanzo corrente
superbaffone
Guest
ah
allora capisco perchè il dollaro sale sull'euro ,
gli USA non sono indebitati nè hanno disavanzo corrente
scordi che hanno goduto di un dollaro debole per qualche anno e "casualmente" quando ne avevano bisogno (al contrario dell'europa che in piena crisi viaggiava con il cambio 1,4/1,5) , poi c'è da dire che se la parità è 1 il dollaro è ancora debole
superbaffone
Guest
gipa69
collegio dei patafisici
ANOTHER EUROPEAN EPIPHANY (FINAL EDITION)
By Charles Payne, CEO & Principal Analyst
6/15/2010 9:27:01 AM Eastern Time
Throughout the Greek economic crisis I have talked about it being a cautionary tale. However, there is a European nation that could be a more fitting example of what faces America under a system that funnels money from earners to pay for bloated government and welfare of non-earners. There was an election in Belgium over the weekend that got scant coverage in America. First, as background on the nation, it has the largest comic book industry per capita in the world. A revolt against the Dutch brought independence in 1830 and a constitutional monarchy in 1831. Initially it was the southern part of the nation, Wallonia, which was the economic powerhouse.
Wallonia is French-speaking and was the source of industrialization. Over the years, things changed and Wallonia began sinking much like the rust belt of the United States. Elite French-speakers didn't make the kinds of adjustments needed to keep up with new economic realities. However, their power in Brussels made it possible to subsidize failure and incompetence for years, and at the expense of their more conservative and hard working neighbors in Flanders. So while Flemish workers kept their nose to the grindstone, making life better and attracting people seeking prosperity, French-speakers in Wallonia joined unions and demanded greater transfers of money. Just as it is unlikely non-union workers in America will accept transferring their earnings to richer government workers who get to retire sooner, the folks in Flanders are just saying no.
Before elections this past Saturday several polls were taken, including a poll of Flemish voters, by a leading newspaper.
As it turns out the party advocating for an orderly breakup of Belgium won the largest amount of parliamentary seats. With 27 seats, the New Flemish Alliance has bolted into the role of powerbroker. The party is separatist but its leader, Bart De Wever, seems open to greater self rule while he is staunchly against spending. He wants to mitigate months of political instability but is insisting the new government "curb runaway spending." This is going to be the real sticking point. As it stands, Belgium is a very socially liberal country that legalized euthanasia in 2002, gay marriages in 2003, and has the highest portion of female ministers of any Western nation. This is a highbrow country that boasts one of the lowest ratio of McDonald's (MCD) per inhabitant in the developed world (0.062 per 10,000 is 7 times less than U.S.A., 4 times less than Japan, and twice as few as France and Germany).
Those things aren't the issue. The issue is an untenable system where one group of people suck out money from another group of people.
The fact is there is a tremendous amount of autonomy in both Flanders and Wallonia but the national government covers legal/justice, health, and social security. It is through the current social security system that the wealth is being redistributed. Flanders transfers billions of dollars to Wallonia and has no say over how it's spent. There are other resentments beyond money as language has become a huge impediment to cooperation. Although the official language of Belgium is Dutch, and a court ruled it must be spoken even in Brussels and surrounding areas, French-speakers have refused to adhere to the law. The French complain the Flemish are dour, money mad, xenophobes. Flemish citizens are incensed by the French-speakers refusal to learn the language. It has been coming for years but it seems the 6.5 million Flemish aren't going to be able to share power with the 4.0 million French-speakers of Wallonia.
Although Belgium is home to 800 different kinds of beers, and 150 liters per person is consumed each year, the nation is beyond a teachable moment. Here's the rub:
40% of people in Wallonia work for the government and unemployment is 20%. It has become an arrogant welfare state that feels entitled. Maybe France will take them in.
Let's Stop Waffling
America is on its way to becoming Belgium. There are people in the nation that will not learn the language, and there are even more people in the country that believe they are entitled to money earned by others. Fewer and fewer Americas pay federal income tax, and those taxes are going higher. Over the weekend, the liberal Christian Democrat party in Belgium was handed a humiliating defeat. I don't know enough about Belgium to say whether it will be broken up but there is a universal theme that is loud and clear. Everyone has to carry their own weight and pro-markets are the best way to create prosperity for all. The big rally cry for the New Flemish Alliance was "Flemish First", but the fact is they were saying "Fiscal Responsibility First." Public debt as a percentage of GDP is 99% in Belgium and it's time for change. It's also time we wake up in America.
We must turn this around. We can't be complacent about all of this and simply think that our past greatness will guarantee future greatness.
Asking people to work to their potential and aim for ownership isn't leaving them on their own, it's empowering them to really be free.
Afghanistan's Wealth
I'm not sure why that Afghan story was so big yesterday as it has been around for a while. I realize the NY Times wrote a piece about the $1.0 trillion in minerals there so maybe it's good to be reminded how American businesses got jerked on opportunities in Iraq and how we are already losing out to other nations like China in Afghanistan Ironically, I spent this past weekend researching our casualty trends in Iraq and Afghanistan because coverage has been too quiet. I felt badly I didn't grab a few Navy and Marine guys and buy them a drink during Fleet Week in NYC, but mostly the rising death toll has been unnerving. We need to say a prayer for the soldiers, and not forget about their sacrifices.
Sure there are many natural resources in Afghanistan and America will not get fair access, I'm sure about that. This isn't the first or last time something like this happens. As policemen of the world it is part of a lack of thanks we always seem to get. The crime is when we forget the price paid at home. So, while everyone does the math on Afghanistan's resources let's pause and think about our most precious resources.
The Market
What a disappointing finish to a session that should have seen equities much higher. Headlines blame another downgrade in Greek debt but I think it's something else. I spoke of Pavlov's dog last week and there was some of that natural selling for no apparent reason except that's the right thing to do into the close. Still, I think it's clear there is more angst at being flat than there was in the past couple of months. We could be setting up for panic buying sprees. The fragility of the market, however, will keep the masses at bay. In fact, it might take one or two better-than-expected jobs report to open the floodgate of buying. I suspect when that happens the market will already be higher.
The lowering of BP debt to BBB' by Fitch could seal the deal with respect to the dividend. We also know a few rivals, including Exxon, are prepared to throw BP under a bus during hearings today. All of this leads to the President's speech tonight and how much will be used to push green energy and cap and trade legislation. I still don't think the average American is willing, nor able, to pay $5.00 a gallon in gasoline. Moreover, the real timeline to a serious transition off fossil fuels is measured in decades. My greatest fear is a general harsh tone against business; that would be disastrous. Still, you have to expect the comments to be well crafted, and looking to hit a triple if not a homerun.
Of course, President Obama is losing this ballgame big-time so even a grand slam isn't going to be enough to win the game. I can only hope as he tries to mend his image it's not done at the expense of business, profits, and capitalism.
Japan, Land of the Rising Debt Bubble
By: Brian Sozzi, Equity Research Analyst
Think fast, what are some of the things that pop into your head when hearing the utterance Japan? Immediately for me my brain wanders to a land with beautiful scenery, a flag with a red circle in the middle, a storied history of communal values, and sushi. Absent that short list, and likely yours, is a completely out of control debt to GDP ratio of 218.6%! Yes, that is correct ladies and gents, 218.6%, hands down the highest among industrialized countries on planet Earth I find it irrelevant from a long-term line of thinking that Japan is able to service its bloated debt, reflecting a huge savings glut, as the Japanese government is letting this debt burden hang around like cigar smoke. As I have painfully learned in my baseball team's crushing defeats this season (yes, I manage the team...you expect anything else?), that when the opposition is left to linger due to a lack of run production, my team loses. Why is this? It's because people become complacent with the status quo, content to just muddle through innings or in the case of Japan, servicing its debt, instead of tackling the problem directly. The Lost Decade has brought about seemingly low forever interest rates and deflation in Japan. The output gap (output relative to GDP) is a whopping 7% according to economists.
By Charles Payne, CEO & Principal Analyst
6/15/2010 9:27:01 AM Eastern Time
Throughout the Greek economic crisis I have talked about it being a cautionary tale. However, there is a European nation that could be a more fitting example of what faces America under a system that funnels money from earners to pay for bloated government and welfare of non-earners. There was an election in Belgium over the weekend that got scant coverage in America. First, as background on the nation, it has the largest comic book industry per capita in the world. A revolt against the Dutch brought independence in 1830 and a constitutional monarchy in 1831. Initially it was the southern part of the nation, Wallonia, which was the economic powerhouse.
Wallonia is French-speaking and was the source of industrialization. Over the years, things changed and Wallonia began sinking much like the rust belt of the United States. Elite French-speakers didn't make the kinds of adjustments needed to keep up with new economic realities. However, their power in Brussels made it possible to subsidize failure and incompetence for years, and at the expense of their more conservative and hard working neighbors in Flanders. So while Flemish workers kept their nose to the grindstone, making life better and attracting people seeking prosperity, French-speakers in Wallonia joined unions and demanded greater transfers of money. Just as it is unlikely non-union workers in America will accept transferring their earnings to richer government workers who get to retire sooner, the folks in Flanders are just saying no.
As it turns out the party advocating for an orderly breakup of Belgium won the largest amount of parliamentary seats. With 27 seats, the New Flemish Alliance has bolted into the role of powerbroker. The party is separatist but its leader, Bart De Wever, seems open to greater self rule while he is staunchly against spending. He wants to mitigate months of political instability but is insisting the new government "curb runaway spending." This is going to be the real sticking point. As it stands, Belgium is a very socially liberal country that legalized euthanasia in 2002, gay marriages in 2003, and has the highest portion of female ministers of any Western nation. This is a highbrow country that boasts one of the lowest ratio of McDonald's (MCD) per inhabitant in the developed world (0.062 per 10,000 is 7 times less than U.S.A., 4 times less than Japan, and twice as few as France and Germany).
Those things aren't the issue. The issue is an untenable system where one group of people suck out money from another group of people.
The fact is there is a tremendous amount of autonomy in both Flanders and Wallonia but the national government covers legal/justice, health, and social security. It is through the current social security system that the wealth is being redistributed. Flanders transfers billions of dollars to Wallonia and has no say over how it's spent. There are other resentments beyond money as language has become a huge impediment to cooperation. Although the official language of Belgium is Dutch, and a court ruled it must be spoken even in Brussels and surrounding areas, French-speakers have refused to adhere to the law. The French complain the Flemish are dour, money mad, xenophobes. Flemish citizens are incensed by the French-speakers refusal to learn the language. It has been coming for years but it seems the 6.5 million Flemish aren't going to be able to share power with the 4.0 million French-speakers of Wallonia.
Although Belgium is home to 800 different kinds of beers, and 150 liters per person is consumed each year, the nation is beyond a teachable moment. Here's the rub:
Let's Stop Waffling
America is on its way to becoming Belgium. There are people in the nation that will not learn the language, and there are even more people in the country that believe they are entitled to money earned by others. Fewer and fewer Americas pay federal income tax, and those taxes are going higher. Over the weekend, the liberal Christian Democrat party in Belgium was handed a humiliating defeat. I don't know enough about Belgium to say whether it will be broken up but there is a universal theme that is loud and clear. Everyone has to carry their own weight and pro-markets are the best way to create prosperity for all. The big rally cry for the New Flemish Alliance was "Flemish First", but the fact is they were saying "Fiscal Responsibility First." Public debt as a percentage of GDP is 99% in Belgium and it's time for change. It's also time we wake up in America.
We must turn this around. We can't be complacent about all of this and simply think that our past greatness will guarantee future greatness.
Asking people to work to their potential and aim for ownership isn't leaving them on their own, it's empowering them to really be free.
Afghanistan's Wealth
I'm not sure why that Afghan story was so big yesterday as it has been around for a while. I realize the NY Times wrote a piece about the $1.0 trillion in minerals there so maybe it's good to be reminded how American businesses got jerked on opportunities in Iraq and how we are already losing out to other nations like China in Afghanistan Ironically, I spent this past weekend researching our casualty trends in Iraq and Afghanistan because coverage has been too quiet. I felt badly I didn't grab a few Navy and Marine guys and buy them a drink during Fleet Week in NYC, but mostly the rising death toll has been unnerving. We need to say a prayer for the soldiers, and not forget about their sacrifices.
The Market
What a disappointing finish to a session that should have seen equities much higher. Headlines blame another downgrade in Greek debt but I think it's something else. I spoke of Pavlov's dog last week and there was some of that natural selling for no apparent reason except that's the right thing to do into the close. Still, I think it's clear there is more angst at being flat than there was in the past couple of months. We could be setting up for panic buying sprees. The fragility of the market, however, will keep the masses at bay. In fact, it might take one or two better-than-expected jobs report to open the floodgate of buying. I suspect when that happens the market will already be higher.
The lowering of BP debt to BBB' by Fitch could seal the deal with respect to the dividend. We also know a few rivals, including Exxon, are prepared to throw BP under a bus during hearings today. All of this leads to the President's speech tonight and how much will be used to push green energy and cap and trade legislation. I still don't think the average American is willing, nor able, to pay $5.00 a gallon in gasoline. Moreover, the real timeline to a serious transition off fossil fuels is measured in decades. My greatest fear is a general harsh tone against business; that would be disastrous. Still, you have to expect the comments to be well crafted, and looking to hit a triple if not a homerun.
Of course, President Obama is losing this ballgame big-time so even a grand slam isn't going to be enough to win the game. I can only hope as he tries to mend his image it's not done at the expense of business, profits, and capitalism.
Japan, Land of the Rising Debt Bubble
By: Brian Sozzi, Equity Research Analyst
Think fast, what are some of the things that pop into your head when hearing the utterance Japan? Immediately for me my brain wanders to a land with beautiful scenery, a flag with a red circle in the middle, a storied history of communal values, and sushi. Absent that short list, and likely yours, is a completely out of control debt to GDP ratio of 218.6%! Yes, that is correct ladies and gents, 218.6%, hands down the highest among industrialized countries on planet Earth I find it irrelevant from a long-term line of thinking that Japan is able to service its bloated debt, reflecting a huge savings glut, as the Japanese government is letting this debt burden hang around like cigar smoke. As I have painfully learned in my baseball team's crushing defeats this season (yes, I manage the team...you expect anything else?), that when the opposition is left to linger due to a lack of run production, my team loses. Why is this? It's because people become complacent with the status quo, content to just muddle through innings or in the case of Japan, servicing its debt, instead of tackling the problem directly. The Lost Decade has brought about seemingly low forever interest rates and deflation in Japan. The output gap (output relative to GDP) is a whopping 7% according to economists.
gipa69
collegio dei patafisici
MARKET BATTLES DATA AND COMMENTARY
By WSS Research Team
6/15/2010 1:43:33 PM Eastern Time
By: Brian Sozzi, Equity Research Analyst
The market very easily could have been much lower to start today's session, and the fact it's not is an intriguing indication. Equities finished yesterday with but minimal conviction following the Greece debt downgrade (how is Spain still rated so high?), and have had to wage a battle with negative vibes throughout today's season. Those vibes include:
Manufacturing in the NY region, as measured by the Empire State Index, for June came in below consensus forecasts. Many are pointing to a reasonable employment component reading in the report. Here's the fact, however. This is June data, therefore incorporating to some degree everything that has unfolded internationally more so than May. Below consensus...I recommend sticking this report in your memory bank ahead of the Philly Fed release this Thursday. A below consensus report on Philly Fed, along with the Empire State report, would imply the manufacturing sector health we have been experiencing is cooling.
Comments by Pimco's Mohammed El-Erian of a "paradigm shift" regarding the global recovery, in addition to Nouriel Roubini musing on "economic stagnation" in the EU, were splashed all over major news sources. However, in reading their comments, I did not sense anything new, which probably explains the market's ho-hum reaction. The comments were dressed up using words pulled straight from a thesaurus, but the underlying premise of slow growth for industrialized nations was maintained. Yawn.
Now what did tickle my interest were the 2Q and FY guidance reiterations that crossed the tape from Caterpillar (CAT) and Illinois Tool Works (ITW). I think the market is not giving due respect to these reiterations, at least not in a grandiose fashion (a major move in each company's stock price). Like I noted recently, the market's bounce from a near four-month low (using the S&P 500) may indicate a growing consensus that 2Q earnings and FY outlooks will circumvent disaster scenarios. Keep in mind that corporations have refrained from hiring workers in droves and building new stores/manufacturing facilities during the economic recovery that began last year, meaning continued strong operating expense leverage.
Both Caterpillar and Illinois Tool Works are multinationals. The fact that guidance was reiterated is a sign that growth remains strong in emerging markets (Africa, A/P, Latin America, Middle East), aka no contagion, and may not be as bad as the market priced into their stocks since they hit 52 week highs on April 26.
Caterpillar
Stock performance from April 26: -16.0%
* 127 dealers outside of the U.S.
* Operations in 182 countries
* 69% of annual revenues derived outside of the U.S.
Illinois Tool Works
* Stock price performance from April: -13.2%
* Operates in 57 countries
* 57% of revenues outside of the U.S
Get Ready for a Gusher of Anger
By: David Silver, Research Analyst
So tonight is the
night that President Obama speaks from the Oval Office about the Gulf Oil Spill. Hopefully, tonight is not all about finger pointing and actually has some value for the economy. The Gulf Oil spill seemed to be a present for the Obama Administration to push alternative energies more, but it has become the ineptitude of BP (not British Petroleum, the company dropped the "British" name a few years back) that has taken center stage. Even BP's fellow oil companies threw it under the bus in testimony. I can almost guarantee each and every CEO of the oil giants are walking off Capitol Hill wiping the sweat off their brow and thanking everyone that this spill wasn't from one of their oil wells.
We are constantly looking to drill for oil in harsher and harsher environments. One mile below the surface, the pressure is more than 150 times greater than that on an oil well in shallower water. Part of the admonishment of BP has come from not having a contingency; well, no one else did either, so it was only a matter of time. Could this be considered a silver lining, perhaps? Estimates are that as much as three million barrels a day have been spilled into the Gulf of Mexico; that seems like a lot right? Well the U.S. uses almost 20 million barrels of oil PER DAY. So over the past two months (the spill began on April 20), the oil leak has put about 15% of one day's use into the Gulf of Mexico.
Another potential speaking point this evening will be "making BP pay." That really was never an issue; BP indicated right from the get-go that it would pay the claims and it has the cash to do it. BP has $240.0 billion in assets, including $70.0 billion in cash, inventories and receivables, compared to $135.0 billion in liabilities; no issue there. You could play speech Bingo tonight, and fisherman will probably come up at least a dozen times. The fact remains that the people on the Gulf Coast rely much more heavily on the oil and gas industry than on the farming, forestry, or fishery industries. According to the U.S. Commerce Department, Louisianans earn $13 from mining and related activities for every dollar they get from fishing. In 2007, the last year for which we have data, the total compensation paid to people in Louisiana working in forestry, fishing and related activities came to just $310.0 million. The figure for mining and support activities was $4.1 billion, with nearly all of it related to oil and gas.
Using those facts, what is hurting the economies of the Gulf Coast more, the oil spill or the moratorium on drilling?
Housing Meanders
By: David Urani, Research Analyst
The NAHB and Wells Fargo released their housing market index, a measure of homebuilder confidence, for June. The index fell to a reading of 17 from 22 the previous month. The components for present conditions, traffic of prospective buyers, and outlook for the next six months all declined month to month. It's another indicator that demand continues to wane following the April 30 expiration of the homebuyers' tax credit. Regionally, all major markets' indexes declined. However, I think investors have already been preparing for this, and therefore the release doesn't seem to be much of a driver of homebuilders' stock movement. Instead, the sector is being lifted along with the broad market.
And Speaking of Oil...
By: Conley Turner, Research Analyst
The price of crude oil is trading higher today in the wake of, among other factors, the release of some positive news regarding the economy. The New York Federal Reserve reported that its index of manufacturing conditions for the month of June showed a distinct improvement month to month (but was still below expectations), underscoring the general outlook that the economy is improving. In addition, import prices in the U.S. declined in May, serving to alleviate concerns among market participants about any near-term prospects for inflation.
Also impacting oil prices today is the fact that the value of the U.S. dollar continues to slide versus a basket of international currencies, including the euro. The value of the euro declined in recent weeks due to a crisis in confidence in the euro zone precipitated by the uncertainty as to whether or not Greece would be able to make its debt payments.
Now that those fears appear to be easing (despite the four notch cut of Greek debt yesterday), market participants are becoming more risk tolerant and are embracing euro denominated assets at the expense of the dollar. Oil, which is priced in dollars, therefore becomes less expensive for holders of other currencies. Crude oil has been trading in tandem with stocks as oil traders and investors have been looking at the equity markets for guidance as to the direction of the economy.
PCs Lift Semis
By: Carlos Guillen, Research Analyst
The signs continue to indicate that the PC business is running strong. From a macro perspective, the slowly improving economic backdrop around the world will undoubtedly provide a boost to PC sales this year. China continues to grow strong, and the U.S. consumer appears to be ready to spend after holding back for quite some time. PC sales ran stronger than expected during the first quarter of the year, and we believe the corporate sector refresh is beginning to ramp up, partially influenced by the accelerating adoption of Windows 7
Providing more support for the notion that PC sales are running strong, market research firm IDC announced that PC sales during the first quarter of 2010 had grown 27.1% from the level reached in the first quarter of 2009. It should be noted that the first quarter of 2009 represented a trough in the PC business as a result of the worldwide economic slowdown; however, at that time, the PC business declined by 7% on a year over year basis, so the 27.1% increased more than makes up for the year ago drop. Best Buy (BBY) this morning reported earnings for its first quarter and PC and notebook sales were one of the few bright spots.
It is encouraging to see that growth was not driven by cheaper priced PCs but actually by higher-end desktops, alleviating the pressure on average selling prices. Breaking a trend that began in 2009, sales of net-books became a smaller factor driving volume in the beginning of 2010. And, although mid-range laptops still dominate the market, desktop PCs made a comeback, posting its first year over year growth since the middle of 2008, and commercial desktops posted its first year over year growth since the downturn. Growth was pervasive in all regions, particularly in emerging markets where sales volume reached a record high, growing by 37% on a year over year basis during the first quarter.
Looking ahead, IDC forecasts that global PC shipments will increase by 19.8% in 2010, surpassing the prior peak reached in 2008 as average selling prices improve as a result of a better mix of products. Net-book volume growth is expected to moderate, while desktop volumes should grow by 8% in 2010 as result of favorable comparisons and as a result of business replacements and the increasing popularity of all-in-one PCs. However, the main driver of PC growth will come from notebooks. As expected, emerging markets will give the largest boost to unit growth as it is expected to grow by 26.6% in 2010, while mature markets will grow at 13.6%.
By WSS Research Team
6/15/2010 1:43:33 PM Eastern Time
By: Brian Sozzi, Equity Research Analyst
The market very easily could have been much lower to start today's session, and the fact it's not is an intriguing indication. Equities finished yesterday with but minimal conviction following the Greece debt downgrade (how is Spain still rated so high?), and have had to wage a battle with negative vibes throughout today's season. Those vibes include:
Manufacturing in the NY region, as measured by the Empire State Index, for June came in below consensus forecasts. Many are pointing to a reasonable employment component reading in the report. Here's the fact, however. This is June data, therefore incorporating to some degree everything that has unfolded internationally more so than May. Below consensus...I recommend sticking this report in your memory bank ahead of the Philly Fed release this Thursday. A below consensus report on Philly Fed, along with the Empire State report, would imply the manufacturing sector health we have been experiencing is cooling.
Now what did tickle my interest were the 2Q and FY guidance reiterations that crossed the tape from Caterpillar (CAT) and Illinois Tool Works (ITW). I think the market is not giving due respect to these reiterations, at least not in a grandiose fashion (a major move in each company's stock price). Like I noted recently, the market's bounce from a near four-month low (using the S&P 500) may indicate a growing consensus that 2Q earnings and FY outlooks will circumvent disaster scenarios. Keep in mind that corporations have refrained from hiring workers in droves and building new stores/manufacturing facilities during the economic recovery that began last year, meaning continued strong operating expense leverage.
Both Caterpillar and Illinois Tool Works are multinationals. The fact that guidance was reiterated is a sign that growth remains strong in emerging markets (Africa, A/P, Latin America, Middle East), aka no contagion, and may not be as bad as the market priced into their stocks since they hit 52 week highs on April 26.
Caterpillar
Stock performance from April 26: -16.0%
* 127 dealers outside of the U.S.
* Operations in 182 countries
* 69% of annual revenues derived outside of the U.S.
Illinois Tool Works
* Stock price performance from April: -13.2%
* Operates in 57 countries
* 57% of revenues outside of the U.S
Get Ready for a Gusher of Anger
By: David Silver, Research Analyst
So tonight is the
night that President Obama speaks from the Oval Office about the Gulf Oil Spill. Hopefully, tonight is not all about finger pointing and actually has some value for the economy. The Gulf Oil spill seemed to be a present for the Obama Administration to push alternative energies more, but it has become the ineptitude of BP (not British Petroleum, the company dropped the "British" name a few years back) that has taken center stage. Even BP's fellow oil companies threw it under the bus in testimony. I can almost guarantee each and every CEO of the oil giants are walking off Capitol Hill wiping the sweat off their brow and thanking everyone that this spill wasn't from one of their oil wells.
We are constantly looking to drill for oil in harsher and harsher environments. One mile below the surface, the pressure is more than 150 times greater than that on an oil well in shallower water. Part of the admonishment of BP has come from not having a contingency; well, no one else did either, so it was only a matter of time. Could this be considered a silver lining, perhaps? Estimates are that as much as three million barrels a day have been spilled into the Gulf of Mexico; that seems like a lot right? Well the U.S. uses almost 20 million barrels of oil PER DAY. So over the past two months (the spill began on April 20), the oil leak has put about 15% of one day's use into the Gulf of Mexico.
Another potential speaking point this evening will be "making BP pay." That really was never an issue; BP indicated right from the get-go that it would pay the claims and it has the cash to do it. BP has $240.0 billion in assets, including $70.0 billion in cash, inventories and receivables, compared to $135.0 billion in liabilities; no issue there. You could play speech Bingo tonight, and fisherman will probably come up at least a dozen times. The fact remains that the people on the Gulf Coast rely much more heavily on the oil and gas industry than on the farming, forestry, or fishery industries. According to the U.S. Commerce Department, Louisianans earn $13 from mining and related activities for every dollar they get from fishing. In 2007, the last year for which we have data, the total compensation paid to people in Louisiana working in forestry, fishing and related activities came to just $310.0 million. The figure for mining and support activities was $4.1 billion, with nearly all of it related to oil and gas.
Using those facts, what is hurting the economies of the Gulf Coast more, the oil spill or the moratorium on drilling?
Housing Meanders
By: David Urani, Research Analyst
The NAHB and Wells Fargo released their housing market index, a measure of homebuilder confidence, for June. The index fell to a reading of 17 from 22 the previous month. The components for present conditions, traffic of prospective buyers, and outlook for the next six months all declined month to month. It's another indicator that demand continues to wane following the April 30 expiration of the homebuyers' tax credit. Regionally, all major markets' indexes declined. However, I think investors have already been preparing for this, and therefore the release doesn't seem to be much of a driver of homebuilders' stock movement. Instead, the sector is being lifted along with the broad market.
By: Conley Turner, Research Analyst
The price of crude oil is trading higher today in the wake of, among other factors, the release of some positive news regarding the economy. The New York Federal Reserve reported that its index of manufacturing conditions for the month of June showed a distinct improvement month to month (but was still below expectations), underscoring the general outlook that the economy is improving. In addition, import prices in the U.S. declined in May, serving to alleviate concerns among market participants about any near-term prospects for inflation.
Also impacting oil prices today is the fact that the value of the U.S. dollar continues to slide versus a basket of international currencies, including the euro. The value of the euro declined in recent weeks due to a crisis in confidence in the euro zone precipitated by the uncertainty as to whether or not Greece would be able to make its debt payments.
Now that those fears appear to be easing (despite the four notch cut of Greek debt yesterday), market participants are becoming more risk tolerant and are embracing euro denominated assets at the expense of the dollar. Oil, which is priced in dollars, therefore becomes less expensive for holders of other currencies. Crude oil has been trading in tandem with stocks as oil traders and investors have been looking at the equity markets for guidance as to the direction of the economy.
PCs Lift Semis
By: Carlos Guillen, Research Analyst
The signs continue to indicate that the PC business is running strong. From a macro perspective, the slowly improving economic backdrop around the world will undoubtedly provide a boost to PC sales this year. China continues to grow strong, and the U.S. consumer appears to be ready to spend after holding back for quite some time. PC sales ran stronger than expected during the first quarter of the year, and we believe the corporate sector refresh is beginning to ramp up, partially influenced by the accelerating adoption of Windows 7
Providing more support for the notion that PC sales are running strong, market research firm IDC announced that PC sales during the first quarter of 2010 had grown 27.1% from the level reached in the first quarter of 2009. It should be noted that the first quarter of 2009 represented a trough in the PC business as a result of the worldwide economic slowdown; however, at that time, the PC business declined by 7% on a year over year basis, so the 27.1% increased more than makes up for the year ago drop. Best Buy (BBY) this morning reported earnings for its first quarter and PC and notebook sales were one of the few bright spots.
It is encouraging to see that growth was not driven by cheaper priced PCs but actually by higher-end desktops, alleviating the pressure on average selling prices. Breaking a trend that began in 2009, sales of net-books became a smaller factor driving volume in the beginning of 2010. And, although mid-range laptops still dominate the market, desktop PCs made a comeback, posting its first year over year growth since the middle of 2008, and commercial desktops posted its first year over year growth since the downturn. Growth was pervasive in all regions, particularly in emerging markets where sales volume reached a record high, growing by 37% on a year over year basis during the first quarter.
Looking ahead, IDC forecasts that global PC shipments will increase by 19.8% in 2010, surpassing the prior peak reached in 2008 as average selling prices improve as a result of a better mix of products. Net-book volume growth is expected to moderate, while desktop volumes should grow by 8% in 2010 as result of favorable comparisons and as a result of business replacements and the increasing popularity of all-in-one PCs. However, the main driver of PC growth will come from notebooks. As expected, emerging markets will give the largest boost to unit growth as it is expected to grow by 26.6% in 2010, while mature markets will grow at 13.6%.