Financial News and Notes 11/13/11 – 11/19/11

Economy

-Japan grew at an annualized 6% rate in the third quarter, its first gain since the tsunami in March.  11/14

-Industrial production fell 2% in September in the Euro-zone adding to fears the bloc of countries will enter a recession later this year.  11/15

-The producer Price index fell 0.3% in October driven by lower gas prices.  It was only the second decline this year.  11/16

-Retail sales continued their rise gaining 0.5% in October for the 5th consecutive gain.  11/16

-The Euro-zone’s GDP rose 0.6% at an annualized rate in the third quarter increasing concerns of an oncoming recession.  11/16

-Manufacturing increased in October by 0.5% making it 4.1% higher than the year earlier level.  11/17

-CPI-U fell in 0.1% in October easing inflation fears and providing relief for holiday shoppers.  11/17

-New jobless claims fell to 388K last week moving the 4 week moving average below the key 400K threshold for the lowest level since April.  The labor market is seen as improving when there are less than 400K weekly jobless claims.  11/18

-The number of U.S. households that have fallen behind on paying their mortgage has dropped to the lowest level since 2008.  11/18

Corporate

-The NBA players union rejected the most recent offer from the league owners and said it would begin to disband putting the season in jeopardy.  11/15

-Warren Buffet made his largest foray ever into the tech sector with a $10.7 billion purchase of IBM shares, a 5.4% stake in the company.  He made the purchases throughout the year beginning in March.  11/15

-Wal-mart finally saw same store sales rise after a 2 year streak of declines, however third quarter profit dipped 2.9% on slimming margins.  11/16

-Dell’s third quarter earnings surged up 9%, but revenue was flat.  The firm also issued a cautious outlook due to concerns about supply shortages and the state of the economy.  11/16

-Target announced their profits rose 3.7% in the third quarter. 11/17

-Yelp filed for an IPO with the SEC.  The Internet review firm is looking to raise up to $100 million.  11/18

Regulatory

-Congress’s deficit reduction super committee continues to be at a stalemate over how to handle taxes.  With less than a week to the deadline, if an agreement is not reached automatic spending cuts of $1.2 trillion over 10 years will kick in.  11/18

Market

-Italy named Mario Monti the new Prime Minister the first change in Prime Minister since Silvio Berlusconi took over 17 years ago.  11/14

-Italy had to offer a euro era high of 6.29% for 5 year government bonds at auction.  11/15

-Europe’s debt crisis moved north to highly rated countries such as Austria, Finland, and Belgium which have been largely unaffected by the debt crisis to date saw yields rise.  Italy’s bonds once again rose above 7%.  11/16

-The price of crude oil, rising for several weeks surged over $100 a barrel to $102.59 a 5 month high.  11/17

-Stocks dropped in the final hour of trading on statements by Fitch that the U.S banking sector “could be greatly affected if contagion continues to spread beyond the stressed European markets.”  The Dow fell 1.6%, the S&P fell 1.7%, the Nikkei dropped 0.9%, Europe was flat, and 10 year treasury’s rose.  France 10 year government bonds hit a Euro era high with a 1.95% spread above German bunds.  11/17

-Investors shrugged off purchases of Euro-zone bonds and continued to push yields higher for Italian and Spanish bonds.  11/17

-Bill Miller, the star mutual fund manager, announced he is leaving Legg Mason’s Value Trust fund.  The fund beat the market for 15 straight years through 2005, but then struggled during the financial crisis and has trailed the S&P 500 for 5 of the last 6 years. 11/18

-The markets continued to fall over European concerns.  The Dow dropped 1.1%, the S&P fell 1.7%, Europe was down 1.3%, and Oil fell back below $100 a barrel.  Ten year US Treasury bond yields fell back below 2%.  11/18

-It was a down week on Wall Street with the Dow finishing down 2.9%, Nikkei fell 1.6%, and Europe was down 3.7% as concerns over Europe continue to weigh on world markets.  11/19

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