Financial News 9/23/12 – 9/29/12

Economy

-Consumer confidence is on the rise as the September reading hit a 7 month high.  9/26

-Home prices are up 5.9% through July for their best year to date gains since 2005 according to the S&P/Case-Schiller 20 city index.  9/26

-Consumer spending accelerated by 3.3% last year, the fastest pace of growth since 2006.  9/26

-China’s central bank has funneled a record amount of cash into the Chinese economy over the past week in an attempt to help counter slowing growth.  The move was welcomed by investors.  9/28

-Durable goods orders fell 13% in August from July, a sign of weakening in the factory sector.  9/28

-In its final revision, GDP was revised down to 1.3% from 1.7% in the second quarter driven by weaker consumer spending and exports.  9/28

-Initial jobless claims dropped more than expected over the past week falling 26,000 to its lowest level since July.  9/28

-Consumer spending jumped up 0.5% in August driven by rising gasoline prices.  It was the largest increase in 6 months.  Factoring in the increased gas prices spending rose only 0.1%.  9/29

Corporate

-Homebuilder Lennar saw its earnings jump in its fiscal third quarter on higher new home delivers, improved prices and a tax benefit.  Its revenues gained 34%.  9/25

-The iPhone 5 achieved a first weekend iPhone sales record and sold out of stores selling over 5 million units, however the number still fell below analysts’ expectations. 9/25

-Caterpillar lowered its profit forecast for the next three years.  9/26

-Blackberry maker, RIM, posted a third consecutive loss over its fiscal second quarter, but increased its subscriber base and cash on hand. 9/27

-Apple CEO Tim Cook apologized to consumers over the new maps application on the latest iPhone.  The iPhone 5 has jettisoned Google maps in favor of mapping software from TomTom which customers have found to be much more primitive.  9/29

Regulatory

-B of A agreed to pay $2.43 billion to settle claims it misled investors in its purchase of Merrill Lynch.  9/29

Market

-Gold has risen to $1,775.50 an ounce its highest level since February on investors’ worries about what the Fed’s actions will do to inflation.  It is up 16% since mid-May.  9/24

-As investors reach for yield the spread between high yield bonds and Treasurys have reached a record low.  The spread fell to 5.42 percentage points last week.  In October of 2011 the spread was 9.1 points.  9/25

-U.S. stocks fell after the Philadelphia Fed President criticized the recent Fed stimulus actions and Caterpillar dropped its profit forecast for their largest daily drop in three months.  The Dow declined 0.7% and the S&P 500 fell 1.1%.  9/26

-Spain outlined plans to help stabilize its economy.  The moves included regulatory changes, tax increases and spending cuts in 2013.  9/28

-US markets snapped back for their largest gain in two weeks on encouraging steps taken in Spain to improve their economy and China pumping cash into the economy.  The S&P 500 gained 1% and the Dow rose 0.5%.  Europe rose 0.3% and China gained 2.6%.  9/28

-Spain unveiled through an audit that it needs $69.34 billion in capital to shore up its banks.  The amount was lower than prior estimates and sets the stage for clean up in ailing sector.  9/29

-Stocks ended September and the third quarter on a down note as worries over Spain reverberated throughout the markets.  The Dow and S&P 500 sank 0.4%.  However, it was a strong month and quarter overall as the S&P 500 rose 2.6% in September and 6.4% in the third quarter.  The Dow gained 2.8% in September and 5.0% in the third quarter. Internationally, markets rose 3.8% in September and 7.6% in the third quarter.  9/29

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