One day later and we have the Dow working to get to the red, not the other way around, as it was yesterday. It reminds me of the push-me-pull-you creature in the Dr. DoLittle books. In any case, speaking about children, their parents, their grandparents and photos of just about everything they do, I will admit I was wrong about Facebook.
- Facebook’s Wednesday earnings report blew away predictions, with monthly average users and daily average users each growing double digits year over year.
Yes, I was one of those who suggested the FB stock price in the 50s range was way over-priced. Furthermore, I dismissed FB as having a big future, and that might still be true, but, as of now, it is, in short order, doing just fine, as is China.
- China’s factory activity expanded at its fastest pace in 18 months in July as new orders surged, a preliminary HSBC survey showed on Thursday.
US employment is doing fine as well, and, as we see, the Eurozone is also working hard to get on the economic improvement train.
- Initial claims for state unemployment benefits declined 19,000 to a seasonally adjusted 284,000 for the week ended July 19, the Labor Department said on Thursday. That was the lowest level since February 2006, and confounded economists’ expectations for a rise to 308,000.
- Across the pond, the Eurozone’s Flash PMI’s also saw improvement. The Composite PMI came in at 54.0, which was an improvement over June’s reading and a multi-month high. In addition, Germany’s flash PMI improved to a 3-month high.
Like the push-me-pull you, there will always be some pull back as the economy pushes forward. New Home Sales took a hit in June and Markit’s Flash manufacturing reading (US) came in under expectations.
- According to the Commerce Department, New Home Sales in June fell 8.1% and were reported at an annualized rate of 406K.
- Markit’s “Flash” (preliminary) U.S. Manufacturing PMI (Purchaser Managers Index) for July was reported at 56.3.
Both are initial estimates, and they could improve (most likely will), although neither is really bad news at all, so, not to worry. The market seems okay with the data. It is now building up a green foundation, as both the S&P and the Dow push toward yet more record territory.
BTW, aside from all the other good economic and earnings news out there, the bad news for commodity player bulls is more good news for the US and global economy, which is good news for the market.
- Agricultural commodity prices, excluding meats, have crashed. Corn, wheat and soybean prices have plummeted on expectations of bumper crops around the world — particularly in the United States. Heavy rains in the growing regions have altered the outlook for drought-stricken areas (except California) and have led to a major decline in prices.
Declining food prices is a good thing for the global economy, as it is a good thing for folks in general. More discretionary income means more consuming of goods other than food and fuel, which will add to the GDP, which will add to the seemingly stellar earnings coming out these days.
Now, if we would only see a drop in oil prices to the 70-80 range …
Trade in the day; invest in your life …
