Wall Street Str...'s  Instablog

Wall Street Strategies
Send Message
Wall Street Strategies has been providing independent stock market research since 1991 to individual, retail and institutional clients through a balanced approach to investing and trading. Charles Payne, our founder and chief analyst, is routinely sought after for his stock market, political,... More
My company:
Wall Street Strategies
My book:
Be Smart, Act Fast, Get Rich
  • ECONOMIC DATA PUTS STOCKS IN THE POSITIVE GROUND By WSS Research Team 0 comments
    Mar 1, 2013 1:47 PM

    By Carlos Guillen

    Panic selling took stocks sharply lower yesterday right before the closing bell, taking the Dow Jones Industrial Average down over 70 points in about 10 minutes. And today, right after the opening bell, the situation appeared to be continuing, but thanks to some better than expected economic data points from the University of Michigan and from the Institute for Supply Management, equity markets are back into winning territory, with the Dow still playing around the 14,000 threshold.

    Quite encouraging today was that consumer sentiment not only landed higher than expected but also increased for a second consecutive month. The University of Michigan's Consumer Sentiment February final result landed at 77.6, higher than the Street's expectation of 76.3, increasing from the 73.8 reached in January. Moreover, the result was an improvement from the preliminary estimate of 76.3. Consumers as a whole are becoming increasingly positive about the economy as employment, equity markets, and housing prices improve, giving them a comforting feeling of increasing wealth. On the other hand, consumers' confidence in government economic policies remained near an all-time low, with just 15 percent thinking the Obama administration and Congress were doing a good job.

    (click to enlarge)

    Another important fundamental bit of economic data out today was the Institute for Supply Management (ISM) Purchasing Managers' index (PMI), considered by many to be a very important health indicator of the manufacturing industry here at home. PMI in February clocked in at a rather encouraging 54.2 percent, landing above the 52.4 percent consensus estimate and increasing from the 53.1 percent reported for the prior month. Given that a reading above 50 percent indicates the manufacturing economy is generally expanding, this PMI result puts us into the third month of growth mode. Moreover, given that a PMI over 42.6 percent, over a period of time, generally indicates overall economic expansion, the result also indicates the 45th consecutive month of overall economy growth. In addition, new orders in the ISM report, considered to be an important leading indicator, also showed an improvement. In fact, new orders in February accelerated, landing at 57.8, up from 53.3 in the prior month

    (click to enlarge)

    Overall it has been a week full of ups and downs, but Stocks are up for the week, with the Dow up close to 90 points from last Friday's closing price, not bad considering all of the scares during the week.

    Construction Spending
    By David Urani

    According to the Census Bureau, construction spending was down 0.2% in January from December. That was actually below the consensus forecast for a 0.6% increase as well, although construction was still up 7.1% year over year. The weakness was in non-residential construction which was down 2.1% while residential was flat.

    And on that note, residential construction spending remains right at the highest level since December 2008, which we hit in the previous month. This may relieve some folks who saw the previously reported decline in January housing starts (although we were okay with it given the ongoing increase in permits for new construction).

    https://www.wstreet.com/user/register.asp?source=3

Back To Wall Street Strategies' Instablog HomePage »

Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (0)
Track new comments
Be the first to comment
Full index of posts »
Latest Followers

StockTalks

More »

Latest Comments


Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.