Markets
For the week of Monday, February 17, 2014 through Friday, February 21, 2014:
- Standard & Poor’s 500 Index: -0.08%
- Dow Jones Industrial Average: -0.27%
- NASDAQ Composite: 0.50%
The markets were closed on Monday in observance of President’s day. Tuesday brought mixed results as The Coca-Cola Company’s (NYSE: KO) quarterly results weighed on the Dow Jones Industrial Average. The S&P gained on good earnings from the Healthcare and Energy sectors. Stocks fell Wednesday after a rocky trading session. While the day began in the green, the markets turned negative after the International Monetary Fund warned about troubles in emerging markets. Stocks plunged again after the minutes from last month’s Fed meeting indicated that a few central bank officials argued for raising interest rates sooner than expected.
Thursday brought data showing jobless claims declined and retail inflation rose in line with expectations. Stock markets closed lower on Friday, erasing the day’s early gains. The intraday upward movement of Friday’s trading session drove the S&P 500 to within 0.5% of its Jan. 15 record of 1848.38. Investors also learned U.S. existing home sales fell 5.1% in January, which was more than forecast.
Economic Data
January Jobs Report:
- January’s total payrolls of 113,000 followed a weak December number that was revised to 75,000.
- The unemployment rate declined from 6.7% to 6.6%.
- Services and government were weak, while goods-producing employment rebounded.
Chain Store Sales Snapshot:
- Chain store sales rose 2.5% week over week.
- Valentine’s Day helped the increase, with improvement seen at jewelry stores, department stores, and apparel retailers.
- Year-over-year, stores saw a 2.1% increase.
MBA Mortgage Applications Survey:
- Mortgage application activity slipped 4.1% for the week ending February 14.
- The purchase index fell 6.3%.
- Refinance activity slid 2.7%.
- Interest rates increased for the first time in more than a month.
Federal Open Market Committee Minutes:
- The minutes from the January FOMC meeting indicated with unemployment reaching 6.5%, it may be time to change forward guidance.
- Quantitative easing will continue with rates not expected to change until 2015.
- However, one approach for change the FOMC may take is to move to a qualitative approach.
Jobless Claims:
- Initial claims for unemployment insurance slid 3,000 to 336,000.
- The four-week moving average increased 1,750 to 338,500.
- Continuing claims rose 37,000 to 2.98 million.
Earnings:
The Coca-Cola Company (NYSE: KO)
- Coca-Cola’s earnings fell as it sold less soda in North America.
- Coca-Cola earned $1.71 billion, or $0.38 a share, compared to $1.87 billion, or $0.41 a share year-over-year.
- Not including one-time items such as the restructuring of its bottling operations overseas, it earned $0.46 a share, which was in line with analysts’ expectations.
- Revenue came in at $11.04 billion, which was well short of analysts’ expectations of $11.31 billion.
- Global sales volume rose 1%, while North American sales volume declined 1%.
Genuine Parts Company (NYSE: GPC)
- Quarterly sales increased 13% to $3.5 billion, versus $3.1 billion last year.
- Net income was $150 million, or $0.97 a share on a diluted basis, versus $160 million, or $1.03 a share, in 2012.
- Excluding the gain, diluted earnings per share in 2013’s fourth quarter rose 4% from 2012.
- Quarterly revenue growth proved to be the strongest of the year, with acquisitions contributing 10% to sales growth.
- Total 2013 sales were $14.1 billion, up 8% compared to 2012.
Wal-Mart Stores Inc. (NYSE: WMT)
- Wal-Mart earned $4.43 billion, or $1.36 a share, compared to $5.6 billion, or $1.67 a share, last year.
- Revenue rose 1.4% to $128.79 billion, but same store sales fell 0.4%.
- This was the fourth consecutive quarterly decline for same-store sales.
- Revenue rose 1.4% to $128.79 billion, but same store sales fell 0.4%.
- The quarter also saw profits during the holiday shopping decline 21%.
- Analysts expected $1.59 a share on revenue of $129.9 billion.
Interest Rates
- The two-year Treasury rate rose one basis point to 0.32%.
- The five-year Treasury rate stayed at 1.53%.
- The 10-year Treasury rate held at 2.74%.
- The 30-year Treasury yield increased one basis point to 3.71%.
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.
