Markets
For the week of Monday, August 4, 2014 through Friday, August 8, 2014:
- Standard & Poor’s 500 Index: 0.40%
- Dow Jones Industrial Average: 0.47%
- NASDAQ Composite: 0.50%
Monday’s session was calm with the major indices closing positive. This was a sharp contrast to recent turbulent trading. Last week, the S&P 500 tumbled to its worst weekly loss in more than two years amid worries about the outlook for Federal Reserve policy and global credit-market woes. Unfortunately, stocks slid on Tuesday, with the Dow Jones Industrial Average posting its fourth loss in five sessions. Stocks rose slightly Wednesday, after starting the day under pressure following widespread declines in Europe amid growing concerns about the European economy. Healthy earnings and belief the U.S. economy is growing have investors thinking the recent declines will be short-lived.
Stocks vacillated between losses and gains much of Thursday morning, only to close in the red. Russia responded to Western trade sanctions by banning imports of food and agricultural products from Europe and the United States. Indices closed in positive territory on Friday, as stocks rebounded from the choppy action throughout the week. The S&P 500 jumped the most in five months as news of reduced Ukraine tensions offset Middle East crises concern. Labor Department numbers showed U.S. workers were more productive in the second quarter and labor costs increased moderately, marking a strong recovery from dire first-quarter results.
Economic Data
Chain Store Sales Snapshot:
- The ICSC Chain Store Sales Index rose 0.2%.
- Year-over-year growth fell from 4.6% to 4.5%.
Factory Orders:
- Factory orders rose 1.1% in June.
- The increase was more than expected and a nice rebound from the 0.6% decline last month.
- Nondefense orders increased 1.0%.
- Durable goods orders were revised up from an increase of 0.7% to an increase of 1.7%.
- Shipments improved, gaining 0.5% compared to last month’s fall of 0.1%.
- Nondurable shipments and inventories increased 0.6% and 0.1%, respectively.
ISM Services Index:
- The ISM Nonmanufacturing Index increased from 56 to 58.7 in July.
- New orders increased from 61.2 to 64.9.
- Inventories fell 2.5 points.
- The employment index increased 1.6 points to 56.
- This was the highest reading for the index since 2005.
MBA Mortgage Applications Survey:
- The MBA Mortgage Applications composite index increased 1.6%.
- Refinancing increased 3.8%.
- Purchase activity fell 1.3%.
Jobless Claims:
- Initial unemployment claims fell from 303,000 to 289,000, reversing part of last week’s 24,000 increase.
- Continuing claims fell 24,000 to 2.518 million.
- The four-week moving average fell from 2.536 million to 2.519 million.
Earnings:
Coach, Inc. (NYSE: COH)
- Coach earned $75.3 million, or $0.27 a share, a 66% decline compared to last year.
- International sales increased 7%, helping offset the 16% decline in North American sales.
- Excluding one-time items, Coach earned $0.59 a share, beating analysts’ estimates of $0.53 a share.
CVS Caremark Corporation (NYSE: CVS)
- CVS reported earnings of $1.25 billion, or $1.06 a share, compared to $1.12 billion, or $0.91 a share, last year.
- CVS’ revenue rose 11% to $34.6 billion, compared to $31.25 billion last year.
- Analysts expected revenue of $33.42 billion.
The Walt Disney Company (NYSE: DIS)
- Disney earned $2.2 billion, or $1.28 a share, a 22% increase over last year.
- Disney reported an 8% increase in revenue to $12.47 billion.
- Movie studio income and theme park revenue helped push the company’s results.
Twenty-First Century Fox, Inc. (NASDAQ: FOX)
- FOX reported earnings of $999 million, or $0.45 a share, compared to a loss of $371 million, or $0.16 a share, year-over-year.
- Excluding one-time items, Fox earned $0.42 a share, up from $0.31 last year.
- Revenue rose 17% to $8.42 billion.
- Analysts anticipated earnings of $0.38 a share on $7.99 billion in revenue.
Intercontinental Exchange, Inc. (NYSE: ICE)
- ICE earned $226 million, or $1.95 a share, compared to $154 million, or $2.09 a share, a year ago.
- Excluding one-time items, such as acquisition costs, ICE earned $2.10 a share.
- Revenue increased from $319 million to $750 million.
- Analysts expected earnings of $2.02 a share on revenue of $777.01 million.
Interest Rates
- The two-year Treasury rate slipped two basis points to 0.46%.
- The five-year Treasury rate fell three basis points to 1.64%.
- The 10-year Treasury rate slid four basis points to 2.45%.
- The 30-year Treasury yield fell three basis points to 3.26%.
Disclosures
This article is meant to provide valuable background information on particular investments, NOT a recommendation to buy. The investments referenced within this article may currently be traded by Henssler Financial. All material presented is compiled from sources believed to be reliable and current, but accuracy cannot be guaranteed. The contents are intended for general information purposes only. Information provided should not be the sole basis in making any decisions and is not intended to replace the advice of a qualified professional, such as a tax consultant, insurance adviser or attorney. Although this material is designed to provide accurate and authoritative information with respect to the subject matter, it may not apply in all situations. Readers are urged to consult with their adviser concerning specific situations and questions. This is not to be construed as an offer to buy or sell any financial instruments. It is not our intention to state, indicate or imply in any manner that current or past results are indicative of future profitability or expectations. As with all investments, there are associated inherent risks. Please obtain and review all financial material carefully before investing. Henssler is not licensed to offer or sell insurance products, and this overview is not to be construed as an offer to purchase any insurance products.
