US FINANCIAL MARKET
- It’s investment in its Canadian launch this year and weaker-than-expected holiday sales caused Target’s net income to fall 2 percent in the fourth quarter of last year. Target has 1,778 stores across the U.S., is focusing on its launch in Canada. The company plans to open 24 Canadian stores by early April, one of five waves that should add up to 124 stores open before the end of the year. In addition, the chain plans to open 15 to 20 new stores in the U.S. It is the most new stores the company has opened in one year in its history.
- Deere is raising its quarterly dividend to 51 cents from 46 cents.
- Coach has hired a former Nike executive to oversee the transformation of its stores as it moves further into segments where the leather goods maker is a relatively small player, such as shoes and clothing.
- JPMorgan plans to cut 17,000 jobs by the end of 2014, representing about 6.6 percent of the company’s overall workforce.
- Analysts at Barclays upped their price target on shares of Home Depot from $70.00 to $78.00 in a research report issued to clients and investors on Wednesday. The firm currently has an “overweight” rating on the stock.
- Moody’s revised its 2013 outlook for the U.S. airport sector to stable from negative as the rating agency said it expects the airports to maintain the financial performance achieved last year.
- PIMCO’s Gross said asset-price irrationality is rising after years of record low benchmark interest rates by the Federal Reserve. “Corporate credit and high yield bonds are somewhat exuberantly and irrationally priced,” Gross wrote. “Spreads are tight, corporate profit margins are at record peaks with room to fall, and the economy is still fragile.”
US ECONOMY & POLITICS
- Headline durable goods orders declined by 5.2%. However, orders for core capital goods — non-defense capital goods excluding aircraft — were significantly stronger than expected at +6.3%. Among core orders, machinery orders posted an out-sized 13.5% gain.
- Durable goods inventories rose 0.2% month-on-month.
- Pending home sales–a good leading indicator of existing home sales–rose by 4.5% in January.
- Fitch Ratings said that implementation of automatic U.S. government spending cuts due March 1, along with a government shutdown, would not prompt a negative rating action. Fitch said the suspension of the debt limit to May 19 has reduced pressure on the U.S. ‘AAA’ rating.
- Chairman Bernanke again noted the possibility of “holding securities a little longer,” or “letting them run off” without selling, in line with the comments he made yesterday and the January meeting minutes.
EUROPE & WORLD
- Euro-Area economic confidence rises more than estimated. An index of executive and consumer sentiment rose to 91.1 from a revised 89.5 in January.
- Consumer confidence in Germany is edging higher as shoppers feel more optimistic about the economic outlook.
- Britain’s economy shrank in the fourth quarter as exports fell and an uncertain outlook depressed company investment. GDP declined 0.3 percent from the three months through September, with net trade knocking 0.1 percentage point from output.
- ECB President Mario Draghi said the bank is “far” from considering an exit from its stimulus measures.
- Hong Kong’s economic growth accelerated to the fastest pace in a year last quarter, signaling that the deepest slowdown since the 2009 global recession is abating. Financial Secretary John Tsang today projected annual growth of 1.5 percent to 3.5 percent this year following 2012’s 1.4 percent.
- Mexican central bank board member Manuel Sanchez said he doesn’t see a case for the first benchmark rate cut since July 2009. The peso rallied and stocks trimmed gains.
TODAY in HISTORY
- The 22nd Amendment to the Constitution was ratified, limiting the President to two terms (1951)
- Star #46 was added to the U.S. flag — for Oklahoma, which had entered the union on November 16, 1907 (1908)