Blog

24 Jan 2003

Posted at 16:30h in The Friday Brief by
We started the week with a report that housing starts in December increased 5% to a 1.835 million-unit annual rate, the highest since June 1986.  December building permits rose 8.2% to a 1.880 million unit annual rate.  The increases were larger than expected and provide strong evidence that the housing boom remains healthy and will likely remain so for months to come.  The boom continues to be fueled by historically low interest rates.  The average rate on a 30-year mortgage was 5.97% last week.  That was close to the 5.85% at the start of the month, which Freddie Mac, the No. 2 buyer of mortgages, said was the lowest since the 1960s.

17 Jan 2003

Posted at 16:35h in The Friday Brief by
As we head into earnings season, the top international news stories, mostly about Iraq, continue to steal the thunder from some pretty good company earnings.  By the end of today, 95 of the S&P 500 will have reported their earnings.  First Call reports that the number of reports beating expectations is well ahead of this time last year.  Granted, the comparisons are pretty easy, but hey, let’s enjoy a little good news.  Many of the major banks reported strong results this week.  Bank of America’s 4th Quarter net income rose 27% and beat average analysts’ estimates by $.06.  BB&T reported a 21% increase in earnings. 

10 Jan 2003

Posted at 16:21h in The Friday Brief by
We began the week with some surprisingly strong economic news.  As reported by the Institute for Supply Management,U.S.manufacturing increased in December by the largest amount since the last recovery from recession in June of 1991.  Manufacturing contributes about 15% to the nations’ economy.  Manufacturing and business in general have been slow to recover in this latest economic slowdown, but this latest ISM report showed much more strength than expected by economists.  Some economists are now raising their growth target for the economy from 1.5% in the first quarter to 2.5%, while others say the report probably overstates the amount of improvement. 

03 Jan 2003

Posted at 16:26h in The Friday Brief by
There is an axiom on Wall Street that says ‘as goes January, so goes the year.’  Yesterday certainly got January off to a good start.  The first trading day of the New Year saw the Dow rise by 3.2%, the S&P 500 by 3.3% and the NASDAQ by 3.7%.  Volume was heavier than the preceding week, but was still well below normal.  However, the buying volume was six times the selling volume; further proof that selling is on the decline. 

20 Dec 2002

Posted at 12:09h in The Friday Brief by
As war talk grows louder and likely dates of conflict crystallize, investors find it hard to focus on anything else.  The amazing thing is the prospect of it seems to carry new emotional impact daily.  Its rather compelling proof that markets can be just as emotional as the individuals who comprise them.  

13 Dec 2002

Posted at 12:12h in The Friday Brief by
Global and domestic conditions are playing into America’s long and strong suits – our economic system and our democratic ideals.  Productivity in the U.S. is rising faster than in any country in the world.  Innovation thrives here because of our broad diversity and because our free market system rewards innovation and risk-taking and because patents and copyrights protect profits for a sufficient time to reward the effort.  In a speech in 1859 Lincoln said:

22 Nov 2002

Posted at 12:15h in The Friday Brief by
Since reaching a five-year low on October 9th caused in large part by the threat of war with Iraq, the Dow has rallied almost 22% from those lows.  The NASDAQ has risen 32% as investors and short-coverers have snapped up depressed technology stocks.  What has changed?  The threat of war seems as great now as it did on early October?  Have stocks risen too far too fast?  The short answer is, quite possibly, but maybe just for the near-term. 

15 Nov 2002

Posted at 12:17h in The Friday Brief by
News that retail sales, excluding automobiles, improved by the most in six months sent the market averages up yesterday over 1.7% for the DOW and 2.5% for the S&P 500.  The .7% rise in sales was more than twice what economists had expected.  Treasuries fell and stocks rose as investors gained confidence that the consumer, hence the economy, might just be hanging on. 

08 Nov 2002

Posted at 16:14h in The Friday Brief by
Every two years we undergo a peaceful revolution in this country known as the mid-term elections, where one third of the Senate and all of the House of Representatives are elected or re-elected.  If you are a Democrat, the last thing you want to read is more talk about the election, but please bear me out.  There are some vital observations that may have been lost so far in the emotion and hype. 

01 Nov 2002

Posted at 16:28h in The Friday Brief by
Roughly three quarters of companies have reported their earnings for the third quarter.  First Call tells us that the actual earnings are running 3.1% ahead of the final estimated earnings for S&P500 companies.  But these earnings expectations have been cut several times by analysts in the weeks leading up to reporting season.  At the beginning of the second quarter of this year earnings growth was expected to be over 16%, but by the start of the Q3 reporting season expectations had been cut to just under 5%.