Stocks are opening higher on a day full of economic data both from home and overseas. The major indexes are likely assured by positive long-term outlooks from the ECB, BOE and BOJ, though the important European Bank revised its economic projections for the current year lower. Still, news in the states showed weekly jobless claims improved to an important historical point, though monthly layoffs were up on mostly Wall Street cuts. Retailers are reporting monthly sales data today, but a slew of them stopped reporting this month, and so the monthly retail sales report will rise in its impact to markets as a result. I expect stocks to hold steady, with a lean to the upside on no serious question posed today. I published an important company specific report this morning on Annaly Capital (NYSE: NLY) at Seeking Alpha, which you should review.
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The day’s data is led by two key employment reports. Weekly Initial Jobless Claims, reported at 8:30 AM ET, showed a 7,000 decrease in new filers last week, to a level of 340K. The four-week moving average also decreased by 7K, to a mark of 348,750, the lowest since March of 2008.
Challenger Gray & Christmas reported on Monthly Job Cuts for February this morning. The report showed a sharp spike in layoffs in February. Job-cuts increased by 37%, to 55,356, which is a rather high level. Planned layoffs were just 7% higher than last year’s period though, which may indicate some seasonal consequence. On the year so far, layoffs are down 9%. Challenger said the financial sector drove the decline, with J.P. Morgan Chase (NYSE: JPM) announcing the most planned layoffs in the period (19K over 2 years).
International Trade data was reported for January this morning. The trade deficit expanded to $44.4 billion in the month, versus economists’ expectations for an increase to $43 billion. In December, the deficit ran at $38.1 billion. Exports declined in January while imports rose.
The BLS revised its fourth quarter Productivity and Costs data this morning. Productivity declined 1.9%, against expectations for a 1.6% decline. The drop matched against the prior quarter’s 3.1% increase. Unit labor costs increased 4.6% in the quarter, after decreasing by 1.9% in the prior quarter.
Catch the Bloomberg Consumer Comfort Index at 9:45 AM ET. This is the most regular measure of consumer sentiment, published on a weekly basis. Last week’s report showed an improvement in consumer comfort to the highest level this year (-32.8). Earlier this year, when consumer sentiment measures were indicating a poor state of affairs, I indicated things would improve once the political pushing and pulling was over in Washington D.C. Voila, yet another reason to follow our column!
Individual retailers will be reporting on their monthly Chain Store Sales starting today (for most). The nation’s most important retailer, Wal-Mart (NYSE: WMT), however, does not supply regular data. Macy’s (NYSE: M), Target (NYSE: TGT) and Kohl’s (NYSE: KSS) joined Wal-Mart in keeping their monthly numbers secret this month. Look for sales calls from some of the major retailers still sharing, like The Limited (NYSE: LTD).
Federal Reserve Governor Jerome Powell gives testimony before the Senate Banking Committee on the subject of money laundering and bank secrecy. This will have the attention of certain island nations and territories in the Caribbean, Atlantic and Mediterranean, plus UBS (NYSE: UBS), Credit Suisse (NYSE: CS) and others.
The EIA reports on Natural Gas Storage at 10:30 AM ET today. Last week’s report covering the period ending February 22 showed a net decline of 171 Bcf, taking supply in storage to 2,229 Bcf. Stocks were 307 Bcf less than last year at this time but 308 Bcf above the five-year average. This is still supportive of low natural gas pricing, and given the still shaky economic outlook and exploration and production activities in North America, I would expect more of the same (barring external event). That’s an important notation… Natural gas futures have been increasing this year, but have steadied of late.
The latest Consumer Credit data will be released at 3:00 PM ET. The data for the month of January is expected by economists to show a monthly expansion of $15 billion, which would match against December’s increase of $14.6 billion. The forecast range extends from $12 billion to $18 billion. Increases have been driven by non-revolving credit of late, which is positive for the auto industry and illustrative of student loan lending growth.
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