Pence Wealth Management’s Financial Market Report

US FINANCIAL MARKET

• CEOs confidence in the economy rebounded in the first quarter, but they remained leery of taking on new workers at home. The Business Roundtable’s CEO Economic Outlook Index rose to 81.0 in March from 65.6 in December, according to the quarterly survey. The Roundtable surveyed 144 member CEOs who employ about 16 million people.
• Some 72% of CEOs expect their companies’ sales to rise in the next six months, up from 58% who expected that in December. But just 29% are planning to boost U.S. employment over the next six months.
• CEOs also modestly raised their expectations for the US GDP. They now expect 2.1% GDP growth, up from a 2.0% three month ago. 
• $358 billion global smartphone market is approaching saturation. Growth is projected to slow to 9.8% in 2017 from 27% this year.
• Irish carrier Ryanair is close to unveiling a landmark $15 billion order for around 170 passenger jets from U.S. aircraft manufacturer Boeing.
• Mondelez International’s board authorized stock buybacks that could total $1.2 billion.
• Genesee & Wyoming’s February traffic volume nearly doubled, thanks in part to the recent acquisition of RailAmerica. Excluding the acquisition, traffic rose 5%, the company said. Carloads of coal and coke more than doubled to 23,815. Adjusted for the acquisition, they rose 7.9%. Agricultural product traffic rose 77% to 19,264 carloads, but fell 10% adjusted for the acquisition.
• Philip Morris International says its CEO will step down but remain in his current job of chairman.
• Discover Financial Services says it will begin offering home equity loans, the latest move by the company to push further into direct banking.
• Samsung is making its biggest run yet at the iPhone’s U.S. loyalists, unveiling the new Galaxy S4 a few blocks from Apple Inc.’s flagship store in New York and broadcasting the event live in Times Square.
• Fidelity Investments is ramping up its small presence in the rapidly growing ETF business by expanding a 3-year-old partnership with BlackRock’s iShares unit. Fidelity has nearly 18.5 million brokerage accounts. Under the agreement, Fidelity offers its brokerage clients commission-free online trades on 30 iShares ETFs. Fidelity also will create new options for its customers to build investment portfolios using iShares ETFs.

US ECONOMY & POLITICS

• The Commerce Department says business inventories grew 1% in January, up from 0.3% growth in December. Wholesale inventories, which account for about 30% of all business stockpiles, jumped 1.2% in January, the biggest in more than a year. The rebuilding of stockpiles may help GDP rebound.
• Headline retail sales rose 1.1% in February (vs. consensus +0.5%). Core retail sales — which feed directly into the personal consumption expenditures component of GDP — rose by a stronger-than-expected 0.4% (vs. consensus 0.2%).
• The headline number was boosted by a 5.0% increase in gasoline station sales in light of the rise in seasonally-adjusted gasoline prices in February.
• Outside of core sales, auto sales rose 1.1% and building materials rose 1.1%.
• Today’s solid number on core retail sales suggests that the tax hikes have had little if any impact on depressing consumer spending in 2013 to date.
• Delays in tax refunds probably hurt sales at restaurants and bars, which fell 0.7%, while receipts at sporting goods, hobby, and book and music stores declined 0.9%. Sales of electronics and appliances slipped 0.2%, while receipts at furniture stores dropped 1.6%, the largest decline since April 2011.
• Separately, import prices rose by 1.1% month-on-month in February (vs. 0.6% consensus). The increase in import prices was largely driven by the volatile petroleum category, which rose by 5.2%.
• Export prices rose 0.8% in February, the largest monthly gain since September. 
• Job openings were slightly higher than expected in January at 3,693k (vs. 3,670k consensus).
• The hiring rate was unchanged at 3.1%, the total separation rate — including firings, quits, and other separations such as retirements — was unchanged at 3.0%, and the quit rate was unchanged at 1.6%.
• Homebuilders in the US are adopting a targeted approach to growth as the cyclical housing market swings upward again. The bigger players are entering the rental market as a growing number of Americans opt to live in rented accommodation.

EUROPE & WORLD

• Euro-area industrial output dropped 0.4% from December.
• South Korea’s newly-named finance minister said Wednesday the recovery in Asia’s fourth-largest economy is weak and might need additional government stimulus. South Korea’s economy may not achieve the 3% growth projected by the government.
• Iranian oil shipments advanced 13% last month even as the U.S. implemented new sanctions against the country. Imports from Iran rose to 1.28 million bpd in February from 1.13 million bpd in January. Iranian exports are still down from an average of 1.5 million bpd last year and 2.5 million in 2011, before sanctions intensified.

TODAY in HISTORY

• Cambridge College was renamed Harvard University (1639)
• The German-born English astronomer Sir William Herschel discovered the planet Georgium Sidus, later known as Uranus (1781)
• “Uncle Sam” cartoon appeared for the first time in N.Y. Lantern weekly (1852)
• Clyde W. Tombaugh announced the discovery of the planet Pluto (1930)
• The Encyclopedia Britannica discontinued its print edition after 244 years (2012)

Sources: Reuters, Yahoo Finance, Google Finance, Bloomberg, CNN Money.

This information has been prepared from sources believed to be reliable, but no representation is being made as to its accuracy or completeness. The information provided should be used only as general information and is not intended to provide specific advice or recommendations for any individual. The economic forecasts set forth in the material may not develop as predicted. All indices, such as the S & P 500, are unmanaged and may not be invested into directly.