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Pence Wealth Management Financial Markets Reports

US FINANCIAL MARKET

  • Wall Street stocks fell at the open on Wednesday as concerns about the impact of a possible cut in the U.S. Federal Reserve’s monthly bond-buying program kept investors cautious.
  • Boeing shares opened 5 % down despite reporting a 26 jump in quarterly profit due to a rise in commercial aircraft deliveries.
    • Earnings excluding some pension expenses will be $7 to $7.20 a share for 2014, the Chicago-based company said in a statement today. That compares with $7.07 in 2013 and an average estimate of $7.46 in a Bloomberg survey of 23 analysts.
    • Boeing said Core earnings, which exclude some pension expenses, rose to $1.84 billion from $1.48 billion a year earlier. Revenue rose to $23.8 billion from $22.3 billion in the quarter.
    • Boeing said it would deliver between 715 and 725 commercial airplanes this year, a possible increase of nearly 12 % from a record 648 in 2013.

 January 29

  • AT&T subscriber growth misses estimates, shares fall at the open. AT&T also added fewer subscribers in the latest quarter than two big rivals, Verizon Wireless and T-Mobile. AT&T reported subscriber net additions of 566,000 for the quarter, well short of the average Wall Street expectation for 636,000. Verizon Wireless had 1.6 million subscriber additions, and T-Mobile U.S. which had 869,000 for the quarter.
    • However, AT&T reported stronger than expected wireless profitability with a service margin of 37.4 %, compared with 29.1 % in the year-ago quarter and analyst expectations closer to 34 %.
    • It reported fourth-quarter earnings of $6.9 billion compared with a loss of $3.86 billion in the year-ago quarter when it had a massive actuarial charge. Revenue rose to $33.16 billion from $32.58 billion slightly ahead of Wall Street expectations for $33.06 billion. For 2014, AT&T forecast continued revenue growth in the 2 to 3 % range.
  • Carl Icahn said he bought another half a billion dollars’ worth of Apple stock on Tuesday, signaling confidence in the iPhone maker even after it gave a disappointing revenue forecast for the current quarter.
  • Yahoo shares plunged 6.5 % at the open after announcing a decline in online ad prices which hurt its revenue for a fourth consecutive quarter. Alibaba, the Chinese e-commerce giant in which it owns a big stake, saw revenue growth decelerate.
    • Yahoo’s overall revenue fell 6 % in the quarter to $1.266 billion, marking four consecutive quarters of eroding revenue. Yahoo’s fourth-quarter net income of $348.2 million rose from the $272.3 million earned in the year-ago period. In the fourth quarter, Yahoo’s revenue from display ads was down 6 % year-over-year, while the price per ad, excluding Korea, declined 7 %.
  • Dow Chemical shares rose 5.8 % at the open after raising its dividend 15 % and expanding its share buyback program to $4.5 billion from $1.5 billion. Quarterly profit was well ahead of expectations.
  • Chrysler Group said its revenue would rise 11 % to about $80 billion in 2014. Revenue for 2013 was $72.14 billion, up 10 % from 2012. Chrysler said it expects 2014 net income to be between $2.3 billion and $2.5 billion. That compares with net income of $2.76 billion in 2013, which includes the one-time tax benefit of $962 million.
  • Google’s $3.2 billion purchase of a digital thermostat maker may jump-start a multibillion-dollar race to acquire companies that are powering the rise of Web-connected devices across homes, cities and workplaces.
  • Airbus Group is studying an upgrade of its A330 wide-body jet with more efficient engines in a contest that may pit General Electric against Rolls-Royce, people familiar with the plan said. The A330, which seats 250 to 300 passengers, comes with engines by GE, Rolls-Royce and United Technologies’ Pratt & Whitney unit. Rolls-Royce has been the most widely used variant in recent years.

US ECONOMY & POLITICS

  • The Federal Open Market Committee (FOMC) will release a statement today at 2 p.m. ET after a two-day meeting in Washington.
  • Edward Snowden was nominated for the Nobel Peace Prize by Norwegian politicians.
  • California farms going thirsty as drought burns $5 billion hole. The drought in California, the top U.S. agricultural producer at $44.7 billion, is depriving the state of water needed to produce everything from milk, beef and wine to some of the nation’s largest fruit and vegetable crops, including avocados, strawberries and almonds.
  • President Barack Obama is offering more Americans the chance to put away money for retirement through payroll deductions with a plan for new government-sponsored savings accounts.
    • The “MyRA” plans, similar to individual retirement accounts, will provide “a new way for working Americans to start their own retirement savings,” Obama said.
    • Under the proposal, workers could have part of their pay deducted for deposit into an account invested in U.S. government bonds that would be treated for tax purposes as a Roth IRA, with future earnings tax-free.
    • The accounts would be open to people with annual household income up to $191,000 whose employers choose to participate, according to a White House fact sheet.
    • Initial investments could be as low as $25 and payroll contributions as low as $5. The plans, set up through the Treasury Department, would have a maximum balance of $15,000, after which money would have to be rolled over into a private-sector Roth IRA, the fact sheet said.

EUROPE & WORLD

  • Global equity markets got an early boost from Turkey’s central bank, which stunned investors late Tuesday with a dramatic rate hike designed to defend its crumbling currency. But the euphoria quickly faded as the market’s focus shifted to Fed’s decision, due at 2 p.m. ET.
    • Turkey’s central bank stunned investors with a huge hike in interest rates on Wednesday. The lira reversed earlier gains after a doubling of interest rates failed to assuage concern that Turkey’s economy will be left exposed by a slowdown in China and a reduction in U.S. monetary stimulus. Stocks fell.
    • South Africa’s currency also slumped today following an unexpected interest-rate increase.
  • The Nielsen Global Consumer Confidence Index stayed at 94 in the fourth quarter for a third straight quarter, but was up 3 points from the same period a year earlier. A reading below 100, however, signals still relatively low consumer morale.
    • Indonesians remained the world’s most bullish consumers in the final quarter of 2013 while Americans were slightly less willing to spend than in the previous quarter, a global survey showed.
  • Fiat has cut its 2014 profit forecast following a slump in Latin American sales. The shares dropped as much as 48 cents to 7.07 euros.
  • Alibaba Group posted its fourth straight quarterly profit gain on surging sales ahead of a potential IPO. Net income was $792 million, a 12 % increase from the June quarter. Alibaba was valued at $120 billion, according to the average estimate of six analysts.

TODAY in HISTORY

  • Kansas became the 34th state in the United States (1861)
  • Karl Benz received a patent for the first successful gasoline-driven car (1886)

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. 

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