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Pence Wealth Management Financial Markets Reports

US FINANCIAL MARKET

U.S. Stocks Fluctuate at the Open amid Facebook, Caterpillar Results

  • The Standard & Poor’s 500 index rose to an all-time high yesterday, as Apple boosted technology companies and health-care shares rallied amid earnings.
  • The S&P 500 has advanced 7.5 % this year amid better-than-estimated corporate results and central-bank support.
  • Profits at S&P 500 members probably rose 6.2 % in the second quarter, while sales gained 3.3 %.
  • The index trades at 18.4 times the reported earnings of its members, the highest since 2010.
  • Facebook jumped 5.2 % after saying second-quarter sales surged 61 %.
  • AT&T dropped 1.3 % as earnings missed forecasts.
  • Caterpillar sank 2 % after forecasting full-year profit that fell short of estimates.
  • Qualcomm declined 6.5 % after forecasting quarterly profit that may trail projections.
  • Global equities advanced today after reports showed euro-area manufacturing and services grew this month while Chinese factory activity rose to an 18-month high in July.

Facebook Posts Second-Quarter Revenue, Profit Topping Estimates

  • Facebook’s revenue surged 61 % in the second quarter, fueled by mobile advertising.
  • Sales rose to $2.91 billion for the period from $1.81 billion a year earlier, topping the average analyst estimate of $2.81 billion.
  • Facebook’s costs and expenses in the quarter increased 22 % to $1.52 billion.
  • Facebook reported profit that more than doubled. Net income rose to $791 million from $333 million a year earlier.
  • Promotions on wireless devices accounted for 62 % of advertising sales. That was up from 59 % in the prior period and from almost nothing at the time of the company’s 2012 IPO.
  • Facebook accounted for 5.8 % of worldwide digital ad revenue in 2013, up from 4.1 % in 2012, according to EMarketer Inc.
  • Digital ad spending worldwide rose 14.8 % to $120 billion last year and is projected to reach $140 billion this year.
  • Facebook said it now has 1.32 billion monthly active users, up from 1.28 billion in the prior quarter, with 654 million using the product daily on mobile phones.
  • Revenue per user was $2.24, up from $2 in the prior quarter and $1.60 a year earlier.

AT&T Misses Earnings Estimates as Customers Shift to Phone Financing

  • The second-largest U.S. wireless carrier said sales rose 1.6 % to $32.6 billion, below the $33.2 billion average estimate.
  • Net income slid to $3.5 billion from $3.8 billion a year earlier.
  • The company added more than 1 million monthly wireless subscribers.
  • That surpassed the 816,000 average of analysts’ estimates, though it fell short of Verizon’s gain of 1.4 million.
  • AT&T’s additions included about 700,000 smartphone subscribers, compared with Verizon’s 304,000 new phone subscriptions. About half of the smartphones AT&T sold were through Next plans.
  • The average monthly wireless-phone bill fell to $62.28 from $67.49 a year earlier.
  • AT&T’s wireless-service profit margin expanded 0.2 percentage point from a year earlier to 42.6 %.
  • In AT&T’s landline video-and-broadband business, called U-verse, the company added 488,000 Internet users and 190,000 video subscribers. That compared with 641,000 U-verse Internet customers and 233,000 TV customers added a year ago.

Union Pacific Profit Meets Estimates as Recovery Spurs Freight

  • Union Pacific posted second-quarter profit that matched analysts’ estimates as an economic rebound drove cargo demand and boosted sales to a record.
  • Net income rose 17 % to $1.3 billion from $1.1 billion a year earlier.
  • Sales increased 10 % to a record $6.02 billion.
  • Union Pacific’s carloads rose 8.2 % during the quarter.
  • Gains were led by shipments of agriculture and general merchandise known as intermodal.
  • It joined CSX and Norfolk Southern in posting record quarterly revenue.

Qualcomm’s Profit Hurt by Dispute over China Royalties

  • Qualcomm shares fell as much as 7 %.
  • Qualcomm’s disclosure signals an escalation of its challenges in China, a market the company has been touting as a main driver of future earnings growth.
  • Qualcomm is in a dispute with a large customer over license revenue, and other customers are under-reporting the amount of phones sold that they should have paid license fees on.
  • Qualcomm predicts industrywide shipments of 1.3 billion 3G and 4G mobile devices in 2014. Of that total, the company estimates that customers will report 1.04 billion to 1.13 billion units as the basis for license revenue calculations, meaning Qualcomm won’t get paid for the technology on as many as 260 million phones this year unless it can solve the disputes and sign up new licensees.
  • Third-quarter net income rose 42 % to $2.24 billion.
  • Sales rose 9 % to $6.81 billion, only the second time quarterly revenue has increased less than 10 % since 2010.

3M Profit Matches Estimates amid Emerging Markets Focus

  • Net income rose 5.8 % to $1.27 billion from $1.2 billion a year earlier.
  • Total sales climbed 4.9 % to a record $8.13 billion as revenue rose across all business lines and geographic regions. Analysts had estimated an average of $8.08 billion.

Caterpillar Sees No Sign of Upturn in Mining Industry

  • Full-year sales and earnings fell short of analysts’ estimates as it said there’s no sign of an upturn in the industry in 2014.
  • Mining companies have cut billions of dollars of capital spending amid surplus commodities production and a drop in prices for coal, iron ore and other metals.
  • Caterpillar said that the industry remains “weak” and order levels are still low.
  • Caterpillar second-quarter sales dropped 3.2 % to $14.2 billion, trailing the $14.5 billion average estimate.
  • Net income rose to $999 million from $960 million a year earlier.

Lilly Profit Beats Estimates on Sales of Diabetes Drug

  • Second-quarter net income fell 39 % to $734 million from $1.21 billion a year earlier.
  • Although revenue overall declined 17 % to $4.9 billion, Humalog sales jumped 11 % to $700.1 million, compared to analyst estimates of $682.7 million.
  • Revenue for the antidepressant Cymbalta were $401.3 million in the quarter, beating estimates of $388.5 million.
  • In December, Lilly lost exclusive marketing rights for the antidepressant Cymbalta, which had $5.08 billion in 2013 sales and is projected to sell $1.51 billion this year.

Bristol-Myers Tops Earnings Estimates on Drug Sales

  • Net income for the quarter fell 37 % to $333 million from $536 million a year earlier.

Ford Profit Tops Estimates Europe Delivers Surprise Gain

  • The second-largest U.S. automaker posted profit that topped analysts’ estimates as sales in China increased and the company reported its first profit in Europe in three years.
  • Ford sales in China soared 35 % in the year’s first half to a record 549,256 vehicles, while deliveries rose 6.6 % in Europe. Ford reported its 21st consecutive profitable period, with net income of $1.3 billion compared with $1.23 billion a year earlier.
  • Ford earned $42.3 billion in the last five years after losing $30.1 billion from 2006 to 2008.
  • The company’s operating margin in North America improved to 11.6 %, from 10.6 % a year ago.
  • Revenue was $37.4 billion compared with $37.9 billion a year ago.

GM’s profit falls on recall costs, victims’ compensation fund

  • GM reported a much lower second-quarter profit due to numerous recalls and the expected cost of at least $400 million for a compensation fund for those killed or injured by a defective ignition switch linked to at least 13 deaths.
  • GM’s revenue rose to $39.6 billion from $39.1 billion a year earlier, missing the $40.6 billion average estimate of six analysts.
  • Net income fell to $278 million from $1.4 billion during the same quarter a year earlier.

American Airlines declares first dividend since 1980 as profit rises

  • The carrier reported net income rose to $864 million from $220 million a year earlier, when the company was not merged.

 

US ECONOMY & POLITICS

Jobless Claims in U.S. Unexpectedly Drop to Eight-Year Low

  • Jobless claims fell by 19,000 to 284,000, the fewest since February 2006 and lower than any economist surveyed by Bloomberg forecast.
  • The four-week average of jobless claims, considered a less volatile measure than the weekly figure, decreased to 302,000, the lowest since May 2007, from 309,250 in the prior week.
  • The number of people continuing to receive jobless benefits declined by 8,000 to 2.5 million, the fewest since June 2007.

U.S. factory activity expands in July: Markit

  • Markit’s preliminary U.S. Manufacturing Purchasing Managers Index (PMI) was 56.3 in July, down from the June reading of 57.3 and below analyst expectations for a reading of 57.5.
  • The output subindex dipped slightly, to 60.4 from 61 in June.

Sales of U.S. New Homes Fell in June after Large Revision

  • Sales of newly built homes declined 8.1 % to a 406,000 annualized pace, the fewest since March and less than any economist surveyed by Bloomberg.
  • The median price of a new home increased 5.3 % last month from a year ago to $273,500.
  • Sales of new properties, which are tallied when purchase contracts are signed, are considered a more timely measure of the market than sales of previously owned dwellings, which are counted when a sale is final.

 

EUROPE & WORLD

Global economy starts second half on solid footing: PMIs

  • China’s factory activity expanded at its fastest in 18 months.
  • HSBC/Markit Flash China Manufacturing Purchasing Managers’ Index (PMI) suggested that government stimulus was working.
  • It rose to 52 in July from 50.7 in June, and beating the consensus forecast of 51 in a Reuters poll.

Euro zone business on solid footing in July but firms cut prices – PMI

  • Markit’s Composite Purchasing Managers’ Index (PMI) rose to 54.0 in July from 52.8, its highest since April.
  • Europe PMI is based on surveys of thousands of companies across the region and a good early indicator of overall growth.
  • Factory activity strengthened in Germany and contracted at the fastest pace this year in France.

 

TODAY in HISTORY

  • Brigham Young and the first members of the Church of Jesus Christ of Latter Day Saints (Mormons) arrived at the Great Salt Lake (1847)
  • Tennessee became the first Confederate state to be readmitted to the Union (1866)
  • The U.S. Supreme Court unanimously ruled that President Richard Nixon had to turn over White House tapes to the Watergate special prosecutor (1974)

 

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. Sources: Reuters, Bloomberg.

Content posted by third parties on this site is screened in order to protect clients’ privacy and comply with regulatory requirements.  Content containing sensitive personal information, inappropriate language, information about specific investments, misleading information, information about other companies or websites, or information related to litigation will be removed.  Content posted by third-parties on this site remains the responsibility of the party posting the content and is not adopted or endorsed by Pence Wealth Management or LPL Financial.  Any opinions or statements posted by third parties are their own and may not be representative of the experience of others and are not indicative of future performance or success.  Third party content on this site does not reflect the views of LPL Financial and have not been reviewed by LPL Financial as to accuracy or completeness.

Pence Wealth Management Financial Markets Reports

US FINANCIAL MARKET

U.S. Stocks Fluctuate at the Open amid Earnings Data From Microsoft, Boeing

  • Microsoft was little changed after fourth-quarter revenue beat estimates.
  • Apple rose 2 %.
  • Boeing sank 2.2 % after taking a charge related to a military tanker.
  • PepsiCo climbed 4.1 %. The softdrink maker reported better-than-projected profit and raised its annual forecast after reducing costs.
  • Whirlpool sank 4.2 %. The appliance maker cut its full-year profit forecast after second-quarter results fell short of analysts’ targets.
  • Biogen jumped 12 %. The world’s biggest maker of multiple sclerosis drugs raised its 2014 profit forecast after quarterly results beat forecasts.
  • The S&P 500 rose yesterday after inflation data signaled the Federal Reserve won’t be compelled to raise interest rates in the near future and earnings reports boosted optimism about the economy.
  • Profits at S&P 500 members probably rose 6.2 % in the second quarter, while sales gained 3.3 %.

Boeing Falls Most in Dow as Tanker Cost Stirs Concern

  • The $272 million after-tax expense for the military jet KC-46A overshadowed Boeing’s increase in its full-year profit forecast.
  • Second-quarter earnings also beat analysts’ estimates today, buoyed by faster production that is sending jetliner deliveries to record levels.
  • The company handed over 181 commercial jets to customers last quarter, the most ever.
  • Sales increased 1 % to $22 billion, trailing the $23 billion projected by analysts.
  • Revenue in the commercial business rose 5 % to $14.3 billion and slid 5.4 % to $7.75 billion in Boeing’s defense operations as the U.S. government pares military spending.
  • Net income jumped 52 % to $1.65 billion from $1.09 billion a year earlier.
  • While Boeing still loses money on every Dreamliner it assembles, losses are shrinking as it smoothes out production kinks and takes advantage of supplier discounts that took effect earlier this year.

Apple Posts Second Straight Profit Gain as IPhone Sales Jump

  • Apple said quarterly profit rose 12 % to $7.75 billion, with a jump in iPhone and Mac sales helping to make up for a drop in iPad demand.
  • Apple sold 35.2 million iPhones and 4.4 million Macs, up 13 % and 18 % respectively.
  • That helped boost revenue by 6 % to $37.4 billion.
  • IPad sales fell for the second straight quarter to 13.3 million from 14.6 million a year earlier.
  • Revenue surged 28 % in greater China despite intense competition.
  • The results were mostly in line with analysts’ estimates.
  • Gross margins were better than expected at 39.4 %, up from 36.9 %.
  • Apple is also approaching one of its most critical product rollouts in years.
  • IPhone sales alone totaled $91.3 billion last year, more than the revenue of Google, Facebook, Twitter, LinkedIn and Tesla Motors combined.
  • Apple had $164.5 billion in cash and investments at the end of last quarter, with all but $27 billion held outside the U.S. International sales accounted for 59 % of the company’s revenue last quarter.

Microsoft’s Quarterly Profit Hurt by Nokia Acquisition

  • Microsoft reported a greater-then-expected 17 % jump in revenue but its profit fell 7 %.
  • Net income was $4.61 billion. That compared with $4.96 billion in the year-ago quarter.
  • Overall quarterly revenue rose 17 % to $23.38 billion, above analysts’ average estimate of $23 billion, mainly because of additional sales from Nokia.
  • Microsoft is struggling to cut costs at Nokia after it completed its 5.44 billion euros ($7.33 billion) acquisition of the mobile-phone operations in April.

Norfolk Southern posts better-than-expected profit

  • Norfolk Southern, which joins other U.S. and Canadian railroads in reporting strong quarterly results, said overall volume rose 8 % as shipments of building materials, metals and coal all rose.
  • Coal volumes, which had been declining due to the growing availablity of cheap shale gas, rose 3 % as rising gas prices encouraged utilities to switch back.
  • Volumes in company’s intermodal business rose 11 %.
  • Net income rose about 21 %, to $562 million from $465 million a year earlier.
  • Railway operating revenue rose 8.6 % to $3.04 billion.

Whirlpool cuts outlook as sales outside North America fall

  • The company also cut its full-year earnings outlook, citing expenses from two pending acquisitions.
  • The company posted second-quarter earnings of $179 million, down from $198 million a year earlier.
  • Whirlpool said it had sold $4.7 billion in goods during the quarter, unchanged from a year earlier.

Biogen Raises Forecast After Profit Beats Estimates

  • The world’s biggest maker of multiple sclerosis drugs said that second-quarter net income rose 46 % to $714.5 million from $490.7 million a year earlier.
  • Revenue jumped 40 % to $2.4 billion.
  • Sales of Tecfidera more than tripled to $700 million in the quarter from a year earlier, exceeding the analysts’ average estimate of $555.7 million.

Dow Chemical profit beats due to higher prices, lower costs

  • Dow Chemical reported a better-than-expected quarterly profit as sales rose and margins improved due to higher prices and a tight control on costs.
  • Dow plans to raise as much as $6 billion from non-core asset sales by the end of 2015 and has put its epoxy business and some chlorine and derivatives assets up for sale.
  • Rival DuPont and a number of other chemical makers are facing increasing investor pressure to divest volatile businesses and return more money to shareholders.
  • Revenue rose 2 % to $14.92 billion, slightly above the average analysts’ estimate of $14.82 billion.

Delta Air quarterly profit rises, aided by U.S. demand

  • Second quarter net income was $801 million compared with $685 million a year earlier.
  • Revenue rose 9 % to $10.62 billion, compared with $10.65 billion expected by analysts.

PepsiCo raises profit forecast as North America snack sales rise

  • The company said organic revenue grew 5 % in its global snacks business, partly due to price hikes.
  • Snack volumes in North America grew 2.5 %, but soda volumes fell 2 %, as health-conscious consumers favored juices and health drinks.
  • PepsiCo’s net income fell 2 % to $1.98 billion from $2.01 billion a year earlier.
  • Revenue rose 0.5 % to $16.89 billion.

 

US ECONOMY & POLITICS

U.S. mortgage applications rise in latest week: MBA

  • The Mortgage Bankers Association (MBA) said its seasonally adjusted index of mortgage application activity, which includes both refinancing and home purchase demand, rose 2.4 % in the week ended July 18.
  • Fixed 30-year mortgage rates averaged 4.33 % in the week, unchanged from the week before.

 

EUROPE & WORLD

TransAsia Airways plane crashes in typhoon-hit Taiwan, killing 47

  • A domestic TransAsia Airways plane crashed on landing on an island off the west coast of typhoon-hit Taiwan.
  • The plane, a 70-seat turboprop ATR 72, crashed near the runway with 54 passengers and four crew on board, the Civil Aeronautics Administration said.

EU Regulators Propose 30% Energy-Savings Target for 2030

  • The EU is currently forecast to boost energy efficiency by 18 % to 19 % by 2020.

Israel Says Offensive to Continue as Kerry Seeks Truce

  • Israel doesn’t plan to stop its Gaza Strip offensive as long as the Palestinian territory’s Hamas rulers continue to pose a threat.
  • Sixteen days of violence have claimed the lives of almost 700 people, including hundreds of Palestinian civilians.
  • Millions of Israeli civilians have been menaced by rocket fire.

Two Ukraine Fighter Jets Downed by Rebels near MH17 Site

  • Rebels downed two Su-25 fighters in the Donetsk region, Defense Ministry spokesman said.
  • They were hit from a missile-defense system over the village of Dmytrivka.
  • The pilots ejected and their whereabouts are unknown, the ministry said on Facebook.

OPEC’s Two-Decade Ride on Global Growth Stalls: Chart of the Day

  • For the past two decades, growth in the global economy spelled higher revenues for the OPEC.
  • Production among OPEC’s 12 members fell 2.5 % to average 31.6 million barrels a day last year.
  • Libya’s output slumped 31 % amid political protests at oilfields and export terminals.
  • Output from Iran, whose exports are subject to international sanctions, fell by 4.4 %.
  • The average price of Brent futures fell 2.7 % to $108.70 a barrel in 2013.

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TODAY in HISTORY

  • William Burt patented a forerunner of the typewriter (1829)
  • Austria and Hungary issued an ultimatum to Serbia after the assassination of Archduke Ferdinand, precipitating World War I (1914)
  • Revolution erupted in Egypt as the military took power in a bloodless coup. The following year the monarchy was abolished and, for the first time since the pharaohs, Egypt was again ruled by Egyptians (1952)

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. Sources: Reuters, Bloomberg.

Content posted by third parties on this site is screened in order to protect clients’ privacy and comply with regulatory requirements.  Content containing sensitive personal information, inappropriate language, information about specific investments, misleading information, information about other companies or websites, or information related to litigation will be removed.  Content posted by third-parties on this site remains the responsibility of the party posting the content and is not adopted or endorsed by Pence Wealth Management or LPL Financial.  Any opinions or statements posted by third parties are their own and may not be representative of the experience of others and are not indicative of future performance or success.  Third party content on this site does not reflect the views of LPL Financial and have not been reviewed by LPL Financial as to accuracy or completeness.

Pence Wealth Management Financial Markets Reports

US FINANCIAL MARKET

U.S. Stocks Rise on Inflation, Home Data amid Earnings

  • Chipotle jumped 12 % after reporting earnings and sales that beat projections.
  • Comcast added 1.8 % after profit topped estimates on higher revenue from Internet customers.
  • DuPont slid 1 % after the U.S. chemicals producer posted lower-than-estimated revenue after some farmers switched to genetically modified soybeans from corn.
  • McDonald’s fell 2.4 % after profit fell short of analysts’ estimates.
  • Coca-Cola dropped 3 % after the world’s largest beverage company reported second-quarter sales that missed analysts’ estimates amid sluggish demand for drinks such as juice and Diet Coke in North America.
  • Travelers dropped 4.3 % as earnings slid 26 %.
  • Data today showed the consumer price index (CPI) increased 0.3 % in June, paced by a jump in gasoline that is now reversing.
  • The S&P 500 advanced almost 6.8 % this year through yesterday amid better-than-estimated corporate earnings and central bank stimulus.

Comcast Profit Tops Estimates with Web Customer Sign-Ups

  • Comcast’s second-quarter net income rose 15 % to $1.99 billion, up from $1.73 billion a year ago.
  • Revenue increased 3.5 % to $16.8 billion, while analysts estimated almost $17 billion.
  • The average customer bill rose to $137.24 a month. More than a third of Comcast’s customers subscribe to all three services: Internet, voice and video.
  • The Philadelphia-based company added 203,000 broadband customers, more than the 159,000 analysts estimated.
  • The company lost 144,000 TV subscribers in a seasonally weak period when college students typically disconnect their TV service for summer vacation.
  • Sales at Comcast’s NBCUniversal group were little changed at about $6 billion, as NBC became the most-watched broadcast network in prime time among 18- to 49-year-olds.

Verizon Beats Earnings Estimates on Stronger User Gains

  • The largest U.S. wireless carrier exceeded profit estimates on stronger customer gains even as T-Mobile brought more promotions and price cuts to the industry.
  • Sales climbed 5.7 % to $31.5 billion, the New York-based company said. Analysts had estimated $31.1 billion in sales.
  • Verizon added 1.4 million contract customers, an improvement from 941,000 a year earlier.
  • The company said it added 100,000 FiOS video customers and 139,000 net new FiOS Internet connections in the quarter.
  • Tablet sales and a shift to phone-financing offers that give customers quicker device-upgrade and trade-in options have helped offset increased competition.
  • The average size of customers’ monthly bills grew 4.7 % to $159.73.
  • Verizon’s wireless service margins expanded to 50.3 %.

DuPont Sees Profit up at Most Units amid Peltz Pressure

  • Second-quarter net income roseto $1.07 billion from $1.03 billion a year earlier.
  • Sales dropped 1.4 % to $9.71 billion, missing the $9.77 billion average prediction.
  • DuPont plans to eliminate $1 billion in annual costs by 2019.
  • DuPont reiterated its full-year operating earnings forecast of $4 to $4.10 a share. The company lowered its guidance in June, citing disappointing agriculture sales.

Lockheed’s Second-Quarter Profit Beats Analyst Estimates

  • The largest U.S. government contractor topped analysts’ estimates for second-quarter profit and sales on the strength of its aircraft division.
  • Net income rose 3.5 % to $889 million from $859 million a year earlier, in part due to lower pension costs.
  • Lockheed also boosted its full-year profit outlook.
  • The maker of the F-35 jet said that sales declined less than 1 % in the quarter to $11.3 billion, but beat the average $11.1 billion estimate of 17 analysts surveyed by Bloomberg.
  • Federal budget reductions contributed to the fourth consecutive annual decline in U.S. government contracting last year, the longest stretch since Ronald Reagan was president.
  • The performance of Lockheed’s largest division, aeronautics, provided a buffer in the second quarter. The unit’s sales jumped 13 % to $3.86 billion, helped by the F-35.

Altria Profit Trails Estimates on Lower Cigarette Shipments

  • The largest seller of tobacco in the U.S. reported second-quarter net income of $1.26 billion, down from $1.27 billion a year earlier.
  • Revenue rose about 1 % to $4.57 billion. Analysts projected $4.59 billion on average.

Coca-Cola Misses Sales Estimates amid Juice and Diet Coke Slide

  • Revenue fell 1.4 % to $12.6 billion. Analysts had estimated $12.8 billion on average.
  • Global juice sales volume declined 1 %, hurt by price increases in North America to offset higher ingredient costs.
  • Gross margin in the quarter rose to 61.7 % from 60.9 % a year ago.
  • Net income fell 3 % to $2.6 billion from $2.68 billion a year earlier.

McDonald’s Profit Trails Estimates as Sales Slump Persists

  • The largest restaurant chain by sales posted second-quarter net income that fell less than 1 % to $1.39 billion from $1.4 billion a year earlier.
  • Revenue rose 1.4 % to $7.18 billion, trailing the estimate for $7.29 billion.
  • McDonald’s U.S. business faces a crowded field and last year it added many new items, slowing down its kitchens.
  • Competitors such as Taco Bell, Wendy’s, and Burger King also are selling more new fare that’s attracting Americans.
  • McDonald’s U.S. same-store sales fell 1.5 %.
  • McDonald’s has more than 35,400 restaurants worldwide and about 19 % are owned by the company. By 2016, the chain is seeking to franchise as many as 1,500 of its company-owned stores, primarily overseas.

Chipotle traffic jumps even after price increase

  • Chipotle Mexican Grill reported a nearly 26 % jump in quarterly profit after traffic to the burrito chain surged despite a menu price increase.
  • Net income grew to $110.3 million from $87.9 million a year earlier.
  • Revenue increased almost 29 % to $1.05 billion during the quarter.
  • Sales at restaurants open at least 13 months, a closely watched gauge of industry performance, increased 17.3 % for the quarter, blowing past 23 analysts’ average estimate for a gain of 10.5 %.
  • Chipotle reported a 13.4 % same-restaurant sales rise for the first quarter.
  • Chipotle has more than 1,600 stores with 45,000 employees.

Netflix profit more than doubles

  • The company’s profit rose to $71 million for the second quarter from $29.5 million a year earlier.
  • Revenue rose 25 % to $1.34 billion from $1.07 billion.
  • Netflix added 570,000 new domestic streaming customers in the quarter and brought the U.S. total to 36.2 million.
  • International customers rose by 1.12 million to 13.8 million.
  • It now exceeds 50 million subscribers.
  • Viewers have reacted positively to shows like “House of Cards” and “Orange is the New Black”.
  • Last year, the company’s original programming was nominated for 14 Emmy TV awards, winning three, and this year its programming garnered a record 31 nominations.
  • Netflix has sought to upend the television industry by commissioning original content for its streaming-video platform and taking on established brands like HBO.
  • At the end of 2013, HBO and its sister channel Cinemax had about 127 million subscribers globally, including 43 million in the U.S. and 84 million overseas, parent Time Warner said in Feb. 26 regulatory filing.

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Apple asks suppliers to produce up to 80 million large-screen iPhones: WSJ

  • Apple has asked suppliers to manufacture between 70 million and 80 million of its two forthcoming large-screen iPhones by the end of the year.
  • Foxconn and Pegatron plan to start mass producing the 4.7-inch iPhone model next month, and Hon Hai Precision Industry, whose parent is Foxconn, will begin making the 5.5-inch version exclusively in September, the people said.

 

US ECONOMY & POLITICS

Consumer Prices in U.S. Climb on Jump in Gasoline Costs

  • The consumer price index (CPI) increased 0.3 %.
  • The core measure, which excludes volatile food and fuel costs, increased 0.1 %, less than projected.
  • Consumer prices rose 2.1 % in the 12 months ended June.
  • The core measure climbed 1.9 %.
  • Gasoline costs jumped 3.3 %, the biggest gain since June 2013, accounting for two-thirds of the increase in total prices, today’s report showed.
  • The average cost of regular gasoline has been falling, reaching $3.57 a gallon on July 20 after being as high as $3.68 on June 25.

Previously Owned U.S. Home Sales Rise to Eight-Month High

  • Sales increased 2.6 % to a 5.04 million annual rate last month.
  • The median forecast of 78 economists surveyed by Bloomberg projected sales would rise to a 4.99 million rate.
  • The median price of an existing home increased 4.3 % to $223,300 in June from $214,000 a year before.
  • The number of existing properties on the market rose 6.5 % to 2.3 million in June from a month earlier, the most since August 2012.
  • First-time buyers accounted for 28 % of all purchases in June, up from 27 % a month earlier.

 

EUROPE & WORLD

Saudi to Open $531 Billion Stock Market to Foreigners

  • The oil-producing kingdom whose stock market has been off-limits to outsiders will allow foreign investors to buy and sell shares next year as it seeks to lure capital to the $745 billion economy.
  • The government pursues a $130 billion spending plan to boost non-energy industries.
  • Saudi Arabia is the biggest stock market outside China, where domestic shares are excluded from MSCI’s global gauges because of limits on foreign investors.

 

TODAY in HISTORY

  • Cleveland, Ohio, was founded by Gen. Moses Cleaveland (1796)
  • Wiley Post became the first person to fly solo around the world (1933)
  • Prince George of Cambridge is born. He is the first child of Prince William, Duke of Cambridge, and Catherine, Duchess of Cambridge (2013)

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. Sources: Reuters, Bloomberg.

Content posted by third parties on this site is screened in order to protect clients’ privacy and comply with regulatory requirements.  Content containing sensitive personal information, inappropriate language, information about specific investments, misleading information, information about other companies or websites, or information related to litigation will be removed.  Content posted by third-parties on this site remains the responsibility of the party posting the content and is not adopted or endorsed by Pence Wealth Management or LPL Financial.  Any opinions or statements posted by third parties are their own and may not be representative of the experience of others and are not indicative of future performance or success.  Third party content on this site does not reflect the views of LPL Financial and have not been reviewed by LPL Financial as to accuracy or completeness.

US FINANCIAL MARKET

U.S. Stocks Fall at the Open amid Earnings, Mounting Global Tensions

  • Geopolitical tensions kept investors on the sidelines before major companies report earnings.
  • Reynolds American dropped 1.7 percent after a jury ordered a unit of the company to pay a Florida woman $23 billion for her husband’s death from lung cancer.
  • Halliburton gained 1.5 percent after reporting that second-quarter revenue topped estimates.
  • EMC rallied 4.3 percent to $28.13 after the Wall Street Journal reported that Elliott Management bought a stake in the maker of storage computers for more than $1 billion.
  • The S&P 500 rallied 1 percent on July 18, rebounding from its biggest loss since April 10 that came after the downing of a Malaysian Airlines passenger jet in Ukraine and the Israeli ground invasion of the Gaza Strip.
  • European Union foreign ministers meeting in Brussels tomorrow will consider tougher sanctions on Russian individuals and companies.
  • About 76 percent of S&P 500 companies that have posted results this season have beaten analysts’ estimates for profit, while 68 percent exceeded sales projections so far.

Reynolds Must Pay $23 Billion Smoker Verdict Likely to be Cut

  • A Reynolds American unit was ordered by a Florida jury to pay a Pensacola woman $23 billion in punitive damages for her husband’s death from lung cancer, her lawyer said.
  • Since a Florida Supreme Court decision in 2006, individual plaintiffs in the state have been awarded large verdicts, with most of those being reduced on appeal.

Gilead Drug Combination Cures Hepatitis C in HIV Patients

  • In a study of 223 HIV-infected patients, Gilead Sciences’ Solvadi cleared the most common U.S. strain of hepatitis C in 76 percent of newly treated patients over 24 weeks.
  • Only seven participants stopped treatment because of side effects and there were no adverse effects on HIV treatment.
  • The high cost of Sovaldi has come under scrutiny from U.S. lawmakers and U.K. regulators.
  • The 12-week course of treatment would be $94,500 and the 24-week course $189,000, according to Saag’s editorial.

Google May Transform NYC Pay Phones Into Wi-Fi Hot Spots

  • Google is among several technology companies considering a plan that uses pay-phone locations to give New Yorkers free wireless Internet access.
  • There are more than 7,300 pay phones in the city.

Yum and McDonald’s apologize as new China food scandal brews

  • Chinese regulators shut a local meat supplier following a TV report that showed workers picking up meat from a factory floor, as well as mixing meat beyond its expiration date with fresh meat.
  • The firms said they’ll stop using the supplier.

Halliburton sees North America margin growth on rise in drilling

  • The world’s No.2 oilfield services provider expects higher margins in North America due to strong drilling activity and is signaling an industry-wide recovery in the region after a two-year slump.
  • Halliburton said that it expects North America margins to touch 20 percent in the third quarter.
  • Its margins in the region rose 2.8 percentage points to 18.2 percent in the second quarter, and were higher than Baker Hughes’ 12 percent and Schlumberger’s 18 percent for the same period, according to analysts.
  • Net income rose 20 percent to $774 million in the quarter, meeting Wall Street’s expectations.
  • Revenue rose 10 percent to $8.05 billion, beating the average analyst estimate of $7.88 billion

Tiffany CEO Kowalski to retire, president Cumenal to take over

  • Kowalski, 62, has been with Tiffany for over three decades. He became chief executive in 1999 and assumed the role of board chairman in 2003.

CBS Outdoor buys Van Wagner billboard unit for $690 million

  • Van Wagner Communications has outdoor advertising in New York’s Times Square and buses on the Las Vegas strip.
  • CBS Outdoor has customers include Apple, McDonald’s, and Sony and went public in late March after it was spun off from CBS.

Tesco ditches CEO for Unilever man after profit warning

  • Clarke, who has spent more than 1 billion pounds ($1.7 billion) on a failed recovery plan in Tesco’s main home market, will be succeeded on Oct. 1 by Dave Lewis.
  • The darling of the retail sector during two decades of uninterrupted earnings growth, Tesco started losing ground in the UK in the final years of long-standing CEO Terry Leahy’s tenure.

US ECONOMY & POLITICS

NABE survey points to rising U.S. wage pressures

  • The National Association for Business Economics’ (NABE) latest business conditions survey found that 43 percent of the 79 economists who participated said their firms had increased wages.
  • That compared to only 19 percent last year and marked an increase from 35 percent in the three months to April.
  • It was the first time since October 2012 that no respondents reported declining wages at their firms.
  • The share of businesses increasing employment jumped to 36 percent in the July quarter from 29 percent a year ago. That was up from 28 percent in the April quarter.

EUROPE & WORLD

Putin Says MH17 Crash Shouldn’t Be Used for Politics

  • As leaders from London to Washington signaled Putin risks becoming a pariah, the Russian leader suggested they were playing politics.
  • A total of 282 bodies have been found, the Ukrainian government said today.
  • Putin again blamed the downing of the plane on the Ukraine conflict and said that international investigators should have full access to the wreckage. Russia will “do everything it can” to seek a negotiated settlement of the Ukraine conflict, he said.

TODAY in HISTORY

  • The first train robbery west of the Mississippi was pulled off by Jesse James and his gang (1873)
  • The U.S. Senate ratified the North Atlantic Treaty (1949)
  • WorldCom filed for bankruptcy, the largest bankruptcy in U.S. history (2002)

 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. Sources: Reuters, Bloomberg.

 Content posted by third parties on this site is screened in order to protect clients’ privacy and comply with regulatory requirements.  Content containing sensitive personal information, inappropriate language, information about specific investments, misleading information, information about other companies or websites, or information related to litigation will be removed.  Content posted by third-parties on this site remains the responsibility of the party posting the content and is not adopted or endorsed by Pence Wealth Management or LPL Financial.  Any opinions or statements posted by third parties are their own and may not be representative of the experience of others and are not indicative of future performance or success.  Third party content on this site does not reflect the views of LPL Financial and have not been reviewed by LPL Financial as to accuracy or completeness.

 

Pence Wealth Management Financial Markets Reports

US FINANCIAL MARKET

U.S. Stocks Advance at the Open on Google While Bonds Fall With Gold

  • Google posted revenue that exceeded analysts’ estimates.
  • GE slipped 0.9 percent as profit matched estimates and the company moved forward with an IPO of its Synchrony Financial.
  • IBM fell after saying revenue dropped for a ninth quarter.
  • AbbVie was little changed after agreeing to buy Shire.
  • The S&P 500 had its biggest drop since April 10 as concern about the implications of escalating tension in Ukraine and the Middle East.
  • Malaysian Airlines jet went down over eastern Ukraine, killing all 298 people on board.
  • Israel began a ground operation in Gaza.
  • The Thomson Reuters/University of Michigan preliminary July index of consumer sentiment decreased to 81.3 from 82.5 the prior month.
  • Treasury 10-year yields climbed to 2.47 percent.
  • Gold, which climbed 1.3 percent yesterday for the biggest advance in four weeks.

Google Sales Top Estimates on Robust Ad Demand

  • Revenue was $12.7 billion. That topped the average projection of analysts for $12.3 billion.
  • Net income rose to $3.42 billion from $3.23 billion a year earlier.
  • The average price for an ad declined 6 percent as smartphones encourage users to bypass Google’s search services and instead go directly to applications to find information.
  • The number of clicks on ads on YouTube, search and other Google sites increased 33 percent in the latest quarter, making up for a decline in ad prices.
  • In the mobile-ad market, prices on smartphones were 57 percent lower than those on desktop computers.
  • Google’s operating expenses, other than the cost of revenue, climbed 25 percent during the quarter to $5.58 billion.
  • The company ramped up hiring during the quarter, adding more than 2,000 employees, pushing headcount to more than 52,000.

GE Profit Matches Estimates as Synchrony IPO Set for July

  • Profit climbed 8 percent from a year earlier to $3.9 billion.
  • Quarterly revenue rose to $36.23 billion, up 3.4 percent from a year ago. Analysts estimated sales of $36.3 billion.
  • GE’s profit margin for its industrial businesses, a closely watched barometer by Wall Street, expanded 0.2 percentage point to 15.5 percent.
  • GE’s backlog of equipment and services rose in every segment, up 10 percent overall, to a total of $246 billion.

IBM’s Nine-Quarter Sales Slump Overshadows Cloud Growth

  • Second-quarter revenue dropped 2 percent from a year earlier to $24.4 billion.
  • Net income climbed to $4.1 billion from $3.2 billion a year earlier.
  • IBM’s contract signings for services — an indicator of expected future revenue — fell 33 percent from a year earlier to $11 billion.
  • IBM ended the quarter with $9.7 billion in cash on hand, little changed from the last quarter.

Kansas City Southern revenue beats on grain, automobile shipments

  • Total revenue rose 12 percent to $649.7 million. Analysts had expected revenue of $645.1 million.
  • Net income jumped to $129.8 million from $15.4 million a year earlier. The year-ago quarter included debt retirement costs of $111.4 million.
  • Revenue from grain shipments rose 33 percent while it increased 25 percent in automotive.
  • KSU operates on a unique, north-south route in central U.S. and derives half of its annual revenue from cross-border business with Mexico.
  • Exports from the United States to Mexico rose 6 percent in the first five months of 2014 while imports increased 3 percent.

Honeywell Tops Profit Estimates on Factory-Gear Demand

  • Honeywell beat analysts’ second-quarter profit estimates, boosted by rising demand for factory automation equipment, and raised the lower end of its full-year forecast.
  • Honeywell is benefiting from U.S. industrial output that expanded at a 5.5 percent annual rate last quarter.
  • The company also is tapping an energy boom in the U.S. on increasing hydraulic fracturing, or fracking, for oil and gas in shale formations.
  • Sales rose 5.8 percent to $10.25 billion, beating the $10.18 billion average estimate.

Johnson Controls revenue rises on higher demand from China

  • Johnson Controls reported a 3 percent rise in quarterly revenue, as demand rose for its car seats.
  • Demand in Johnson Controls’ automotive business, its largest was driven mainly by China, which contributed about 32 percent to the division’s third-quarter revenue of $5.7 billion.
  • Total revenue rose to $10.8 billion from $10.5 billion, a year earlier.

Rebounding North America boosts Schlumberger revenue

  • Schlumberger, the world’s largest oilfield services company, reported better-than-expected second quarter revenue as drilling activity picked up in North America.
  • North America revenue jumped 16 percent to $3.89 billion from a year earlier.
  • Schlumberger has the lowest exposure to North America among the big four oilfield service providers, which include Halliburton and Baker Hughes.
  • International markets brought in about two-thirds of Schlumberger’s quarterly revenue.
  • Total revenue rose 8 percent to $12.05 billion.
  • Net income fell by nearly a quarter to about $1.60 billion from $2.10 billion. The company recorded $205 million settlement charges.

Amazon Starts $9.99-a-Month Service for Unlimited E-Books

  • Amazon introduced a $9.99-a-month service for unlimited Kindle e-book downloads.
  • Kindle Unlimited includes more than 600,000 Kindle books and thousands of audiobooks from Audible.

AbbVie to Buy Shire for $54.8 Billion in Tax Inversion

  • Shire holders will receive cash and stock valued at 52.48 pounds a share.
  • The price is 53 percent above Shire’s closing level on May 2, before AbbVie made its first takeover proposal.
  • AbbVie becomes the latest U.S. health company to move abroad amid a record period of pharmaceutical deals.

US ECONOMY & POLITICS

Leading Economic Indicators Index in U.S. Increased 0.3% in June

  • The Conference Board’s gauge, a measure of the outlook for the next three to six months, increased 0.3 percent after a revised gain of 0.7 percent in May.
  • The median forecast of 49 economists surveyed by Bloomberg called for a 0.5 percent advance.

U.S. consumer sentiment dips in preliminary July reading

  • The Thomson Reuters/University of Michigan’s preliminary July reading on the overall index on consumer sentiment came in at 81.3, below both the consensus analyst expectation of 83 and the final June read of 82.5.
  • The survey’s barometer of current economic conditions rose to 97.1 from 96.6, compared with a forecast of 97.0.
  • The survey’s gauge of consumer expectations slipped for a third straight month, to 71.1 from 73.5. The subindex was below an expected 74.0.

EUROPE & WORLD

Russian-Made Missile Hit Malaysian Jet, U.S. Officials Say

  • A Russian-made air-defense missile appears to have hit the Malaysian Airline plane that crashed in Ukraine, according to U.S. military and intelligence officials.
  • Evidence so far indicates that the plane was struck by a weapons system known as the SA-11 or Buk, according to four officials.
  • It’s not clear who fired the missile at the airliner.

Netanyahu Orders Military to Ready Wider Gaza Incursion

  • Israeli soldiers, backed by tanks, heavy artillery, aircraft and warships, moved into the Hamas-controlled enclave late yesterday after 2,100 air strikes over 10 days failed to quash barrages of rockets fired from Gaza at Israel.
  • More than 260 Palestinians, including dozens of children, and two Israelis have been killed since fighting intensified last week.

TODAY in HISTORY

  • A great fire began that ultimately destroyed most of Rome. The emperor Nero blamed it on Christians and began the first Roman persecution of them (64)
  • President Harry S. Truman signed the Presidential Succession Act (1947)
  • 14-year-old Romanian gymnast Nadia Comaneci earned the first perfect score, a ten, at the Olympics and went on to score six more tens and win three gold medals (1976)

 

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. Sources: Reuters, Bloomberg.

 Content posted by third parties on this site is screened in order to protect clients’ privacy and comply with regulatory requirements.  Content containing sensitive personal information, inappropriate language, information about specific investments, misleading information, information about other companies or websites, or information related to litigation will be removed.  Content posted by third-parties on this site remains the responsibility of the party posting the content and is not adopted or endorsed by Pence Wealth Management or LPL Financial.  Any opinions or statements posted by third parties are their own and may not be representative of the experience of others and are not indicative of future performance or success.  Third party content on this site does not reflect the views of LPL Financial and have not been reviewed by LPL Financial as to accuracy or completeness.

 

Pence Wealth Management Financial Markets Reports

US FINANCIAL MARKET

U.S. Stocks Fluctuate as Microsoft Gain Offsets Sanctions

  • U.S. stocks fluctuated, after the Dow Jones Industrial Average closed at a record yesterday.
  • Microsoft gained 3 % after saying it will eliminate as many as 18,000 jobs.
  • UnitedHealth jumped 2.2 % as earnings topped forecasts.
  • SanDisk dropped 11 % after posting profit margins and sales forecasts that fell short of some analysts’ estimates.
  • The U.S. and European Union said more sanctions against Russia may follow after the most punitive sanctions so far over the unrest in Ukraine.
  • The U.S. Housing starts fell 9.3 % to an 893,000 annualized rate from a 985,000 pace in May that was weaker than initially estimated.
  • The Federal Reserve Bank of Philadelphia’s factory index increased to 23.9 in July. Readings greater than zero signal growth.

Microsoft Eliminating 18,000 Jobs as Nadella Streamlines

  • The restructuring, amounting to about 14 % of its workforce, includes 12,500 Nokia factory and professional positions.
  • The reductions will result in a pretax charge of $1.1 billion to $1.6 billion.
  • Microsoft will also shift the Nokia X, which uses Google’s Android, to the Windows Phone operating system in order to broaden its products in the cheaper smartphone category.

EBay Reports Second Quarter Results

  • Revenue increased 13% to $4.4 billion.
  • Earnings increased 9 % to $676 million.
  • PayPal net total payment volume grew 29% with Merchant Services volume up 35% and on-eBay volume up 13%.
  • PayPal’s revenue grew to $1.9 billion.
  • PayPal gained 4.0 million new active registered accounts to end the quarter at 152 million, up 15%.

PPG Reports Record Second Quarter Net Sales and Earnings

  • Second quarter net sales was $4.1 billion, up 5 % versus prior year, slightly below estimate.
  • Net income was $393 million, slightly above estimate.

Grainger Reports Results for the 2014 Second Quarter

  • Sales increased 5 % to $2.5 billion.
  • Operating earnings decreased 3 % to $341 million.
  • Both numbers were below average estimate.
  • The company’s gross profit margin for the quarter decreased 0.9 percentage point versus the prior year to 43.1 %.

Morgan Stanley profit more than doubles, beating estimates

  • Net income rose to $1.86 billion from $803 million.
  • Revenue rose 1 % to $8.61 billion.

Philip Morris Earnings Top Estimates on European Sales

  • The world’s largest publicly traded tobacco company’s net income fell 13 % to $1.85 billion from $2.12 billion a year earlier.
  • Revenue fell 1.5 % to $7.8 billion. That exceeded analysts’ $7.53 billion average estimate.

Danaher Reports Record Second Quarter 2014 Results

  • Net earnings increased 9% to $676.4 million, missed average estimate.
  • Revenues increased 5% to $5 billion, which also missed average estimate.

Yum Brands Profit Trails Some Estimates on Pizza Hut

  • Net income rose 19 % to $334 million from $281 million a year earlier.
  • Revenue gained 10 % to $3.2 billion, missing the $3.24 billion average estimate.

Boeing Buoyed at Show with $46 Billion in Day-Three Sales

  • Boeing escaped Airbus’s shadow on the third day of the Farnborough Air Show as an agreement to sell new 777X jets to Qatar Airways drove a $46 billion haul of orders and options.
  • The agreement nudged Boeing ahead of Airbus in announced sales at the biggest aviation expo, with about $63 billion to the European planemaker’s $61 billion.

 

US ECONOMY & POLITICS

Construction of New U.S. Homes Declines on Plunge in South

  • Housing starts fell 9.3 % to an 893,000 annualized rate from a 985,000 pace in May.
  • Construction slumped 29.6 % in the South to a 375,000 pace.
  • Construction of single-family houses declined 9 % to a 575,000 rate.
  • Work on multifamily homes, such as apartment buildings, fell 9.9 % to a 318,000 rate.
  • The average rate for a 30-year fixed mortgage was 4.15 in the week ended July 10.
  • The median selling price of a new home sold in May increased 6.9 % to $282,000.
  • Building permits decreased 4.2 % in June to a 963,000 annualized rate.

Jobless Claims in U.S. Unexpectedly Decreased Last Week

  • Jobless claims declined by 3,000 to 302,000 in the week ended July 12.
  • The four-week average of jobless claims declined to 309,000, the lowest since June 2007.
  • The number of people continuing to receive jobless benefits dropped by 79,000 to 2.51 million in the week ended July 5, the fewest since June 2007.

The July Philly Fed manufacturing index was stronger than expected, on solid composition

  • The Philly Fed manufacturing index rose to 23.9 in July from +17.8 in June.

Fed seen likely to raise rates in 2nd quarter of 2015: Reuters poll

  • The Fed will likely raise its target for the overnight lending rate, known as the Fed funds rate, to 0.25 % between April and June next year, according to the median forecast of 71 analysts polled in the past week.
  • Economists now see the Fed funds rate ending next year at 0.75 %.
  • Most thought the first hike would come in the third quarter of 2015 but that rates would end the year at 1.0 %.

 

EUROPE & WORLD

Reserves Break $3 Trillion Mark in Emerging Markets

  • Developing nations from Colombia to South Korea have accumulated so many dollars through intervening to curb currency gains that their foreign reserves now exceed $3 trillion for the first time.
  • Nations are filling up with dollars while they can, before a boost in U.S. interest rates reduces the yield advantage their assets enjoy.
  • China isn’t included in Bloomberg’s aggregate figures because its $3.99 trillion of reserves are larger than all its peers combined.

China Faces Second Corporate Bond Default Amid World’s Biggest Debt

  • Huatong Road & Bridge, based in the northern province of Shanxi, said it may miss a 400 million yuan ($64.5 million) note payment due July 23.
  • Companies in China are facing tougher operating conditions as growth looks set to cool to 7.4 % this year, the slowest in more than two decades.

 

TODAY in HISTORY

  • Spain ceded Florida to the United States (1821)
  • Spain surrendered to the United States at Santiago, Cuba, ending the Spanish-American War (1898)
  • The British royal family changed its name from the House of Saxe-Coburg-Gotha to Windsor amid anti-German sentiment during World War I (1917)
  • President Harry Truman, Soviet leader Joseph Stalin and British Prime Minister Winston Churchill meet at the opening of the Potsdam Conference (1945)
  • Disneyland opened in Anaheim, CA (1955)
  • The last Russian Czar Nicholas II was buried 80 years after he and his family were executed by the Bolsheviks (1998)

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. Sources: Reuters, Bloomberg.

Content posted by third parties on this site is screened in order to protect clients’ privacy and comply with regulatory requirements.  Content containing sensitive personal information, inappropriate language, information about specific investments, misleading information, information about other companies or websites, or information related to litigation will be removed.  Content posted by third-parties on this site remains the responsibility of the party posting the content and is not adopted or endorsed by Pence Wealth Management or LPL Financial.  Any opinions or statements posted by third parties are their own and may not be representative of the experience of others and are not indicative of future performance or success.  Third party content on this site does not reflect the views of LPL Financial and have not been reviewed by LPL Financial as to accuracy or completeness.

Pence Wealth Management Financial Markets Reports

US FINANCIAL MARKET

U.S. Stocks Rise at the Open as Intel to Time Warner Jump amid Deals

  • Merger and acquisition activity continued to thrive on Wall Street.
  • A partnership struck between IBM and Apple also helped boost indexes.
  • Time Warner surged 17 % as Rupert Murdoch’s 21st Century Fox made a takeover bid that was rebuffed.
  • Intel gained 5.9 % as its third-quarter sales forecast fueled optimism the personal-computer market is emerging from a two-year slump.
  • Apple and IBM rose at least 1.1 % after agreeing to develop applications for corporate users of wireless devices.
  • Bank of America dropped 2.2 %. The second-biggest U.S. bank said profit declined 43 % as it spent $4 billion to cover litigation costs.
  • Yahoo! fell 4.1 %. The U.S. Web portal reported second-quarter earnings and sales that fell short of analysts’ estimates.
  • Data today also showed China’s economic growth accelerated for the first time in three quarters.
  • U.S. industrial production climbed 0.2 % in June, capping the strongest quarter in almost four years.
  • Wholesale prices in the U.S. rose more than forecast in June, reflecting a jump in energy costs that is now abating.

Murdoch Is Open to Offer $75 Billion for Time Warner

  • Fox is willing to pay more than $85 a share.
  • Fox calculates the combined company could achieve more than $1 billion in cost savings.
  • A deal would reshape the media industry by giving the TV-and-film companies bargaining power in negotiations with cable operators such as Comcast and Time Warner Cable.

BofA Profit Declines on $4 Billion Costs for Litigation

  • Net income fell to $2.29 billion in the second quarter from $4.01 billion a year earlier.
  • Revenue dropped 4.3 % to $22 billion as expenses climbed 16 % to $18.5 billion because of the litigation costs.
  • U.S. prosecutors have asked for $17 billion to resolve probes into the lender’s sale of mortgage bonds before the financial crisis.
  • Bank of America has offered $13 billion to settle a probe into mortgage securities sold by the bank, the Wall Street Journal reported today.

Apple Puts IBM Rivalry to Rest with Corporate Sales Deal

  • The deal unveiled yesterday gives Apple access to an IBM sales force that will recommend Apple’s devices to customers in industries such as health care and banking, which have never been priorities for the consumer-focused iPhone maker.
  • A key element of the Apple-IBM deal is developing mobile-centric software tools for businesses.
  • IBM gets a boost in a long-running effort to sell software and services to companies seeking to manage workers’ smartphones and tablets.
  • The partnership helps Apple pursue a bigger slice of the market for corporate users of wireless devices.
  • Apple has already recognized the potential of the corporate market, touting that its devices are used by employees at 98 % of Fortune 500 companies. Deutsche Bank has almost 20,000 iPhones, while Siemens has 30,000, Apple said in April.
  • Apple and rival Samsung are seeking to further displace BlackBerry, which once held a strong grip on the corporate market.

Intel Rises as Sales Forecast Fuels PC-Market Optimism

  • Net income in the second quarter rose 40 % to $2.8 billion from $2 billion a year earlier.
  • Sales rose 8 % to $13.8 billion. Analysts had predicted sales of $13.7 billion.
  • Gross margin, or the percentage of sales remaining after deducting the cost of production, was 64.5 %.
  • The PC market has shown signs of improvement this year as corporate spending picked up and U.S. shipments returned to growth.
  • Revenue in the current period will be $14.4 billion, plus or minus $500 million. Analysts on average estimated sales of $14.1 billion.

CSX Sales Hit Record as Rail Cargo Shows Economy Strength

  • Record quarterly revenue from CSX, the largest railroad in the eastern U.S., signals a strengthening economy as companies shipped more goods, grain and domestic coal by rail.
  • CSX reported revenue of $3.24 billion in the second quarter.
  • Net income was $529 million compared with $521 million a year earlier.
  • CSX operates on about 21,000 miles of route track across 23 states east of the Mississippi River.
  • Coal rebounded during the quarter as the harsh winter and higher natural gas prices caused more utilities to burn more coal.
  • Shipments of crude oil produced in U.S. shale fields have also contributed to the increase of carloads.
  • The railroads, which usually don’t own oil tank cars, agreed in February to slow crude oil trains to 40 miles per hour from 50 mph in urban areas and install new sensors on oil routes to detect track defects.
  • The railroad is seeking to increase train speeds and boost on-time deliveries following a systemwide traffic jam caused in part by the harsh winter weather in the first quarter.

Yahoo to Keep More of Alibaba after IPO, Return Cash

  • Yahoo! said it would return at least half of the cash it reaps from Alibaba’s IPO to shareholders.
  • Yahoo’s sales, excluding revenue shared with partner websites, was $1.04 billion in the second quarter, missing analysts’ average estimate of $1.09 billion.
  • Net income was $269.7 million, down from $331.2 million a year ago.
  • Yahoo’s display ad sales fell 7 %.

Boeing Bounces Back at Show as Qatar Doubles 777-9X Order

  • Boeing, which lagged behind Airbus’s order haul on the first two days of the Farnborough Air Show, bounced back with a commitment from Qatar Airways to double planned purchases of the 777-9X model.
  • Qatar Airways said it wants to buy an additional 50 of the largest twin-engine model.
  • The value of the follow-up commitment is $18.9 billion, making it the single biggest deal yet at this year’s show.

 

US ECONOMY & POLITICS

Wholesale Prices in U.S. Increase More Than Forecast on Fuel

  • The 0.4 % increase in the producer price index (PPI) followed a 0.2 % drop in May.
  • Fuel costs climbed 2.1 %, the biggest gain since February 2013.
  • Crude oil prices have dropped this month as concerns about supply disruptions ease.
  • Compared with a year earlier, companies paid 1.9 % more for goods and services, matching the median forecast of economists.
  • The core measure, which strips out volatile food and fuel costs, climbed 0.2 %, matching the survey median.
  • The core index increased 1.8 % in the 12 months ended June.

Industrial Production in U.S. Climbed 0.2% in June

  • Industrial production climbed 0.2 % in June, capping the strongest quarter in almost four years and indicating manufacturers are providing a bigger spark for the U.S. economy.
  • The gain in output at factories, mines and utilities last month followed a revised 0.5 % advance in May.
  • Production rose at a 5.5 % annualized rate from April through June, the most since the third quarter of 2010.
  • The fastest pace of motor vehicle sales in eight years and a recent pickup in bookings for business equipment indicate further gains in output.
  • An improvement in overseas markets would also contribute to busier assembly lines and propel the economy in the second half of the year.
  • Manufacturing, which makes up 75 % of total production, grew 0.1 % in June, less than forecast.
  • In the second quarter, factory production advanced at a 6.7 % annualized rate, the fastest since the first three months of 2012.
  • Capacity utilization, which measures the amount of a plant that is in use, held at 79.1 % in June.

Homebuilder Confidence in U.S. Climbs to Six-Month High

  • The NAHB/Wells Fargo sentiment measure climbed to 53 from 49 in June.
  • The housing market is showing signs of improvement after higher mortgage rates and harsh winter weather stalled the recovery earlier this year.
  • A strengthening labor market, combined with wage gains and rising consumer sentiment, will probably support further progress in the industry
  • The measure of the six-month sales outlook rose to its highest level since September, climbing to 64 this month from 58 in June.
  • An index of current single-family home sales increased to 57, the best reading since January, from 53.

Yellen Watches American Paycheck for Signals on Shadow Slack

  • The central bank chief referred to the “slow pace of growth” in measures of hourly compensation in remarks to the Senate yesterday.
  • “You can’t have sustained inflation without sustained wage growth because then people have no purchasing power and higher prices just can’t stick,” said Aneta Markowska chief U.S. economist at Societe Generale.

 

EUROPE & WORLD

Japan’s Holdings of U.S. Treasuries Rose to Record in May

  • Japan’s holdings of U.S. government debt rose $10.4 billion to a record $1.22 trillion in May.
  • China’s holdings of Treasuries in May increased for the first time since January, gaining $7.7 billion to $1.27 trillion.

BRICS Agree on $50 Billion Bank with Something for Everyone

  • Leaders of the five BRICS nations agreed on the structure of a $50 billion development bank by granting China its headquarters and India its first rotating presidency.
  • The leaders also formalized the creation of a $100 billion currency exchange reserve.
  • Both initiatives, which require legislative approval, are designed to provide an alternative to financing from the IMF and the World Bank, where BRICS countries have been seeking more say.

China’s Economic Expansion Accelerates to 7.5%

  • Industrial production rose 9.2 % in June from a year earlier, topping the 9 % median estimate.
  • Fixed-asset investment excluding rural households increased 17.3 % in the first half from a year earlier. That compared with the median estimate of analysts for 17.2 % growth.

 

TODAY in HISTORY

  • The District of Columbia was established as the seat of the United States government (1790)
  • Russia’s Czar Nicholas II and his family were executed by the Bolsheviks (1918)
  • The first parking meters were installed in Oklahoma City (1935)
  • The first atomic bomb was tested in Alamogordo, N.M. (1945)
  • Apollo 11 took off on the first manned flight to the moon (1969)
  • Saddam Hussein became president of Iraq (1979)
  • John F. Kennedy, Jr., his wife Carolyn Bessette, and her sister Lauren, died in a plane crash near Martha’s Vineyard, Massachusetts (1999)

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. Sources: Reuters, Bloomberg.

Content posted by third parties on this site is screened in order to protect clients’ privacy and comply with regulatory requirements.  Content containing sensitive personal information, inappropriate language, information about specific investments, misleading information, information about other companies or websites, or information related to litigation will be removed.  Content posted by third-parties on this site remains the responsibility of the party posting the content and is not adopted or endorsed by Pence Wealth Management or LPL Financial.  Any opinions or statements posted by third parties are their own and may not be representative of the experience of others and are not indicative of future performance or success.  Third party content on this site does not reflect the views of LPL Financial and have not been reviewed by LPL Financial as to accuracy or completeness.

Pence Wealth Management Financial Markets Reports

US FINANCIAL MARKET

U.S. Stocks Open Positive as Yellen Says Stimulus Must Continue

  • JPMorgan and Goldman increased more than 1.5 % after the banks reported better-than-estimated earnings.
  • Lorillard dropped 7.1 % after Reynolds American reached agreement to buy its rival for $27.4 billion including debt.
  • The S&P 500 Index is higher by more than 190 % during the current five-year bull market. The gauge has rallied 7.2 % this year.
  • Retail sales increased 0.2 % after a 0.5 % advance in May that was larger than previously reported.
  • Manufacturing in the New York region grew in July. The Federal Reserve Bank of New York’s general economic index rose to 25.60.

JPMorgan Profit Beats Estimates on Trading, Shares Climb

  • Net income declined 7.9 % to $5.99 billion from $6.5 billion a year earlier, topping average estimate.
  • Revenue slid 2.3 % to $25.4 billion from a year earlier.
  • JPMorgan, the second largest U.S. mortgage lender after Wells Fargo, said its profit from mortgage lending fell 38 % to $709 million, while mortgage application volumes dropped 54 % to $30.1 billion.

Goldman Posts Surprise Profit Gain on Trading, Deal Fees

  • Net income climbed 5 % to $2.04 billion from $1.93 billion a year earlier. That beat average estimate.
  • Revenue rose 6 % to $9.13 billion.
  • Goldman Sachs ranked first in advising on announced mergers and acquisitions and fifth in underwriting U.S. bonds.

J&J’s New Hepatitis C Medicine Pushes Profit Past Estimates

  • Net income rose 13 % to $4.3 billion from $3.8 billion a year earlier.
  • Revenue was $19.5 billion, up 9 % from a year before.
  • Johnson & Johnson also raised its adjusted earnings guidance for the year.

Reynolds Acquiring Lorillard for About $25 Billion

  • Reynolds, the producer of Camel and Pall Mall cigarettes, will pay a mixture of cash and stock valuing each Lorillard share at $68.88.
  • British American Tobacco (BAT) will fund $4.7 billion of the transaction, letting it maintain a 42 % stake in Reynolds.
  • BAT’s U.K. rival Imperial Tobacco, meanwhile, will acquire brands such as Kool and Blu e-cigarettes for $7.1 billion.

Hewlett-Packard Chairman Whitworth Resigns for Health

  • Hewlett-Packard will discuss a replacement for Whitworth, 58, at its next meeting.

Time Warner Seeks NBA Renewal to Tap Sports Gold Mine

  • Time Warner, along with Walt Disney’s ESPN, is seeking to renew the last major U.S. sports deal that’s up for grabs until 2021.
  • The current deal expires in 2016.
  • Time Warner and Disney, which split up airing the games, pay the league an average of $930 million a year combined.
  • Time Warner currently has rights to air 52 regular-season games and up to 52 playoff games.
  • Disney’s rights include 75 regular season games and up to 29 playoff games.
  • The merger of Comcast and Time Warner Cable will give the combined company 30 million TV subscribers, while AT&T’s bid to buy DirecTV will give it a total of about 25 million subscribers.
  • The added heft would give them more leverage when negotiating licensing agreements with programmers like Time Warner.

U.S. approves limited flights for F-35 fighters

  • U.S. military officials have approved limited flights for Lockheed Martin’s F-35 fighter jets.
  • The F-35, the world’s most expensive weapons project with a price tag of about $400 billion, has been grounded since the massive failure of the Pratt & Whitney engine on a U.S. Air Force F-35 plane at a Florida air base on June 23.
  • Global orders for the F-35 are expected to exceed 3,000, with Italy, Turkey, Canada and Australia among the U.S. allies planning to purchase the plane.

Google’s Nest launches network technology for connected home

  • Google’s Nest Labs unveiled an industry group to encourage makers of smart home gadgets like locks and light bulbs to use Thread, a new standard for devices to communicate on a network.
  • The attempt by Nest to lead the way on how future household devices to speak to each other, underscores the importance Google puts on areas like cars and the home.

GE expects to meet $30 billion air show target early

  • GE Aviation CEO expects to achieve its Farnborough Airshow target of $30 billion of orders.

 

US ECONOMY & POLITICS

Yellen Says Continued Easing Needed Amid Job-Market Slack

  • Janet Yellen told lawmakers the central bank must press on with monetary stimulus as “significant slack” remains in labor markets and inflation is still below the Fed’s goal.
  • Yellen cited labor-market weaknesses even after an unexpectedly fast decline in unemployment put pressure on Fed officials to consider accelerating their timetable for an interest-rate increase.
  • Signs of labor-market slack include slow wage growth and low labor-force participation.

Retail Sales in U.S. Showed Broad-Based Increase in June

  • Purchases increased 0.2 % after a 0.5 % advance in May that was larger than previously reported.
  • The reading fell short of the 0.6 % increase projected by the median estimate of 83 economists.
  • Consumers are more comfortable opening their wallets as a strengthening labor market lifts earnings.
  • Core sales, the figures used to calculate GDP and which exclude such categories as autos, gasoline stations and building materials, increased 0.6 % last month, the best showing since March.

U.S. business inventories up, retail stocks rise modestly

  • Inventories increased 0.5 % after rising 0.6 % in April.
  • Retail inventories, excluding autos, which go into the calculation of GDP, edged up 0.1 % after a similar gain in April.
  • A sharp slowdown in the pace of inventory accumulation helped to weigh down on the economy, which contracted at a 2.9 % annual pace in the first quarter.
  • Inventories subtracted 1.7 percentage points from GDP and a swing in restocking is expected to raise growth above a 3.0 % pace in the second quarter.
  • Business sales rose 0.4 % in May after advancing 0.8 % in April.

 

EUROPE & WORLD

EU’s Juncker urges minimum wage in all EU countries

  • Designated European Commission President Jean-Claude Juncker said he would work towards the introduction of a minimum social wage in each member state of the European Union.

 

TODAY in HISTORY

  • Georgia became the last of the Confederate States to be readmitted to the Union (1870)

 

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. Sources: Reuters, Bloomberg.

Content posted by third parties on this site is screened in order to protect clients’ privacy and comply with regulatory requirements.  Content containing sensitive personal information, inappropriate language, information about specific investments, misleading information, information about other companies or websites, or information related to litigation will be removed.  Content posted by third-parties on this site remains the responsibility of the party posting the content and is not adopted or endorsed by Pence Wealth Management or LPL Financial.  Any opinions or statements posted by third parties are their own and may not be representative of the experience of others and are not indicative of future performance or success.  Third party content on this site does not reflect the views of LPL Financial and have not been reviewed by LPL Financial as to accuracy or completeness.

Pence Wealth Management Financial Markets Reports

US FINANCIAL MARKET

U.S. Stocks Rise at the Open amid Deals Activity as Citigroup Rallies

  • Citigroup climbed 3.1 percent after also agreeing to pay $7 billion to settle a mortgage-bond probe.
  • Apple rose after Barclays Plc advised investors to buy shares in the world’s biggest company by market value.
  • The S&P 500 has rallied 7 percent this year amid signs the U.S. economy is recovering from a 2.9 percent contraction in the first quarter.
  • The benchmark gauge closed at an all-time high and the Dow topped 17,000 for the first time on July 3.
  • The S&P 500 hasn’t had a drop of 10 percent in more than two years.
  • The gauge trades at a valuation of 18 times reported earnings, the highest since 2010.
  • JPMorgan, Goldman, Yahoo, and Intel are among the 58 companies on the S&P 500 posting earnings this week.
  • Investors will also be watching statements from central banks and economic reports this week. Janet Yellen is due to testify to U.S. lawmakers.
  • European Central Bank President Mario Draghi testifies today at the European Parliament.
  • Economists surveyed by Bloomberg expect the Bank of Japan will maintain the pace of its monthly bond-buying at this week’s policy meeting.

Citigroup Reaches $7 Billion Mortgage-Bond Settlement

  • Citigroup posted second-quarter profit that beat analysts’ estimates.
  • The bank took a $3.7 billion charge in the second quarter.
  • Net income after legal charges fell 96 percent to $181 million from $4.18 billion a year earlier.
  • Revenue fell 3 percent from a year earlier to $19.4 billion, while operating expenses dropped 3 percent to $11.8 billion.
  • Analysts surveyed by Bloomberg projected $18.8 billion in revenue.

AbbVie Moves Closer to Shire Deal With $53.7 Billion Bid

  • Shire said it would support a formal bid of 53.20 pounds a share, or 9.2 percent more than Shire’s closing share price on July 11.
  • Buying Shire allows AbbVie to move its tax residence to the U.K. and add treatments for rare diseases and attention deficit disorder.

Mylan to buy some Abbott drug assets in $5.3 billion deal

  • Generic drugmaker Mylan said it would buy Abbott Laboratories’ specialty and branded generics business outside the United States in an all-stock transaction valued at about $5.3 billion.

Whiting to buy Kodiak for $3.8 billion, create No. 1 Bakken producer

  • Whiting Petroleum, after the deal, will become the largest producer in North Dakota’s Bakken shale oil formations.

Airbus jet re-launch heralds busy aerospace show

  • The Farnborough air show kicks off Monday at an airfield in rural England, represents the aerospace community’s annual opportunity to take the pulse of the business of flying.
  • Airbus will begin the air show with up to 100 commitments for the A330neo, stepping up a contest with Boeing for up to $250 billion of orders at the core of the long-haul jet market.
  • Airbus unveils revamp of A330 passenger jet. Deliveries of the A330neo will start in the fourth quarter of 2017.

Boeing Squeezes Seats into 737 to Boost Low-Cost Carrier Appeal

  • The aircraft will seat as many as 200 in a single cabin and is based on the re-engined 737 Max 8 set to debut in 2017.
  • The modified 737 model will be targeted at ultra-low-cost carriers seeking high-density seating configurations to pack in passengers on shorter flights were demand exceeds capacity.
  • Airbus previously said it planned to boost the number of seats on its A320neo by nine to 189.

Lockheed F-35 Fire Probe Finds No Sign of Systemic Flaws

  • U.S. defense officials see no broad safety issues with Lockheed Martin’s F-35 Joint Strike Fighter after an engine fire forced the grounding of the fleet.
  • The F-35 has been plagued by a costly redesign, bulkhead cracks, excessive weight and delays in software. Building all 2,443 planes is projected to cost $398.6 billion, a 71 percent increase in inflation-adjusted dollars since the contract with Lockheed was signed in 2001.

VW to spend $900 million at Tennessee plant to build new SUV

  • The German automaker chose to build the seven-passenger, three-row SUV at its plant in Chattanooga, Tennessee, instead of at its facility in Puebla, Mexico starting in late 2016.
  • About $600 million of the $900 million will be invested in Tennessee, VW said.
  • VW’s $1 billion factory in Chattanooga started operating in 2011, building a cheaper, roomier version of the carmaker’s mid-sized Passat sedan specifically designed for American customers.
  • From 2014 to 2018, VW will invest more than $7 billion in the United States and Mexico.

Home Depot Starts Selling 3-D Printers in Stores

  • The 3-D printing industry is still in its early stages and will need people to become educated on how to use software to design objects, said Tim Shepherd, an analyst at research firm Canalys in the U.K.
  • “Ten years from now, it will be quite common for people to have 3-D printers in their homes,” he said.
  • The consumer market for 3-D printing will reach $600 million in 2017, up from $70 million to $80 million last year.
  • Home Depot is the home-repair market leader — with $78.8 billion in revenue last year — followed by Lowe’s, which had $53.4 billion.

Aecom Technology Agrees to Buy URS for About $4 Billion

  • The transaction brings together companies that provide support and planning services for governments and large engineering and construction projects in the U.S., Canada and other countries.
  • The combined company will have more than 95,000 workers in 150 countries.

Uber Woos Drivers With $1,000 Bonuses in Tussle With Lyft

  • For Uber, more drivers are important to establishing itself as the biggest car-booking provider.
  • Drivers are independent contractors who can work for multiple companies at the same time.
  • They typically own their car and can make as much as $8,000 a month, depending on how long they’re on the road and excluding insurance, gas and other costs.
  • Uber has rolled out its service in 75 U.S. cities and is in a total of 39 countries. Lyft is in 68 cities in the U.S.

‘Planet of the Apes’ Reigns in Cinemas with $73 Million in Sales

  • A big summer sequel from 21st Century Fox, opened as the No. 1 film in domestic theaters over the weekend.
  • Summer cinema sales in the U.S. are falling further behind last year’s record pace, in large part because studios spread out the timing for their biggest films to avoid stealing sales from each other and to work around soccer’s World Cup.
  • Weekend sales for the top 10 films fell 27 percent to $134.8 million from a year earlier.

US ECONOMY & POLITICS

Yellen says Fed easy money needed even after recovery

  • The Federal Reserve will still need to deliver “unusually accommodative” monetary policy even once the U.S. economy returns to “where we want it to be”.

Fed officials debate timing of interest rate increases: WSJ

  • A debate is intensifying among the Federal Reserve’s regional bank presidents about whether to push interest rates up from zero sooner than planned because of recent improvements in the U.S. job market, the Wall Street Journal reported.
  • Most Fed officials at June’s policy meeting didn’t see rate increases until 2015.
  • Fed officials hadn’t expected unemployment to fall to near 6.1 percent until the end of this year.

EUROPE & WORLD

Draghi Seen Delivering $1 Trillion to Banks in ECB Offer

  • The ECB has identified lending to companies and households as a key weakness in the euro area’s fragile recovery.
  • The ECB targeted lending program for banks will boost credit for the real economy as planned, and at the same time help keep the financial system flush with cash.

China’s Okay Airlines orders Boeing 737 planes

  • China’s airlines had ordered six 737 MAX 8 planes and four 737-800 aircraft, worth $980 million at list prices.

Euro zone industry stumbles in May, recovery still frail

  • Output in the 18 countries sharing the euro dropped 1.1 percent on the month in May.

Putin signs nuclear energy deal with Argentina

  • Putin’s energy minister, Alexander Novak, told reporters in the Argentine capital that the Russian state atomic energy corporation, Rosatom, had made an offer to tender for the construction of two new nuclear power units in Argentina.

TODAY in HISTORY

  • The storming and destruction of Bastille marked the beginning of the French Revolution (1789)
  • Congress passed the Sedition Act, making it a crime to publish false, scandalous, or malicious writing about the U.S. government (1798)

 

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. Sources: Reuters, Bloomberg.

 Content posted by third parties on this site is screened in order to protect clients’ privacy and comply with regulatory requirements.  Content containing sensitive personal information, inappropriate language, information about specific investments, misleading information, information about other companies or websites, or information related to litigation will be removed.  Content posted by third-parties on this site remains the responsibility of the party posting the content and is not adopted or endorsed by Pence Wealth Management or LPL Financial.  Any opinions or statements posted by third parties are their own and may not be representative of the experience of others and are not indicative of future performance or success.  Third party content on this site does not reflect the views of LPL Financial and have not been reviewed by LPL Financial as to accuracy or completeness.

 

Pence Wealth Management Financial Markets Reports

US FINANCIAL MARKET

U.S. Stocks Open amid Bank Earnings and Portugal Debt

  • Wall St. is flat, but Internet names support NASDAQ. Amazon up 4.2 percent and eBay up 2.4 percent.
  • Whirlpool rose 1.9 percent after the company agreed to buy 66.8 percent of voting stock of Italy’s Indesit Company for about $1.03 billion.
  • The S&P 500 is valued at 18 times reported earnings, the highest level since 2011.
  • Wells Fargo fell 1.3 percent after reporting per-share earnings that did not rise for the first time in 18 quarters.
  • Fastenal sank 5.6 percent after sales fell short of analysts’ estimates.
  • Lorillard jumped 4.8 percent after Reynolds American Inc. said it’s in talks to buy the cigarette maker.
  • More than 140 companies in the S&P 500, including Citigroup, JPMorgan, Goldman Sachs, and Johnson & Johnson, will report quarterly results between now and July 23

Wells Fargo reports slight profit rise, says economy improving

  • The world’s most valuable bank said profit increased 3.8 percent on lower credit costs even as the lender’s per-share earnings failed to top the preceding quarter’s for the first time since 2009.
  • Net income for the second quarter advanced to $5.73 billion from $5.52 billion a year earlier.
  • Revenue fell 1.5 percent to $21.1 billion from a year earlier.
  • Wells Fargo accounted for about 28 percent of U.S. home loans in the first quarter of 2012.
  • Wells Fargo lent $47 billion in home loans, down from $112 billion a year earlier but up from $36 billion in the first quarter.
  • Income from mortgage banking fell 39 percent to $1.7 billion compared with the second quarter of 2013.
  • The bank had $30 billion of mortgage applications in the pipeline at quarter-end, up from $27 billion at the end of the first quarter.

Amazon Seeks FAA Permission to Test its Drones Outdoors

  • Amazon asked aviation regulators for permission to expand testing its deliver packages by drone outside its research laboratory.
  • The company wants to deliver packages weighing less than 5 pounds (2.3 kilograms) with unmanned aircraft capable of reaching speeds of more than 50 miles (80 kilometers) an hour.
  • Amazon says 86 percent of its deliveries are light enough to be made by its proposed drones, allowing for faster service to customers.

Reynolds American Confirms Discussions to Buy Lorillard

  • Together, Reynolds and Lorillard have a market value of about $56 billion and annual sales of more than $13 billion.
  • British American Tobacco owns 42 percent of Reynolds.
  • If the three companies reach an agreement, Lorillard’s biggest brand, Newport, would join Camel as the combined company moves to compete with Altria, whose brands account for more than half of the U.S. retail cigarette market.
  • Altria’s Marlboro by itself has market share in the U.S. of about 44 percent.

BMWs Made in America Surge as Biggest Auto Export

  • BMW started auto assembly in South Carolina 20 years ago today.
  • Pushed by spiraling energy costs and tightening labor rules in Germany, BMW will have poured additional $7.3 billion into the site once the latest expansion is completed in two years.
  • Auto workers in the U.S. are about 47 percent cheaper to employ than their counterparts in Germany, according to data from the Berlin-based VDA auto lobby.
  • The factory, which will employ 8,800 people by 2016, is already the biggest exporter of U.S.-made cars to markets outside North America, beating any facility run by GM, Ford or Chrysler as well as the entire state of Michigan.

Chrysler to recall 900,000 SUVs to fix mirror wiring

  • Some 2011-2014 models of Jeep Grand Cherokee and Dodge Durango will be recalled.

U.S. sues Amazon over purchases by kids using mobile apps

  • The U.S. government sued Amazon.com on Thursday for allowing children to collectively run up millions of dollars in purchases on the credit cards of their unsuspecting parents.
  • The FTC settled a similar case with Apple in January. Apple agreed to refund to customers at least $32.5 million in unauthorized charges made by children.
  • The FTC complaint cited “Tap Zoo” and “Ice Age Village” in which children manage a zoo or an ancient town.

Microsoft CEO signals change, defers talk on job cuts

  • Nadella said he would address detailed organizational and financial issues for the company’s new financial year.
  • He described Microsoft as a “productivity and platform company” focused on mobile and cloud computing, a subtle advance on Ballmer’s reinvention of Microsoft as a “devices and services” company.

Pimco’s Gross Cuts U.S. Government-Related Debt Holdings in June

  • The proportion of U.S. government-related debt in the $225 billion Total Return Fund was 47 percent last month.
  • That compared with 50 percent the previous month, which was the highest level since 54 percent in July 2010.

Carl Icahn says ‘time to be cautious’ on U.S. stocks

  • Billionaire activist investor said “While we are having a great year, I am being very selective about the companies I purchase.”

US ECONOMY & POLITICS

Obama and corporate giants announce plan to boost suppliers

  • President Barack Obama is enlisting several major U.S. and multinational companies to draw attention to an initiative aimed at helping small businesses expand and hire workers.
  • The president will meet on Friday with representatives of household name firms such as Apple, AT&T, Coca Cola, and Johnson & Johnson to spotlight the corporate giants’ pledge to pay their smaller suppliers within 15 days.
  • Other firms attending the White House event include CVS, FedEx, IBM, Lockheed Martin, Honda, Toyota, Rolls Royce, and Walgreens.
  • Frustrated by a legislative stalemate with the Republican-led House of Representatives, Obama has vowed to act unilaterally when he can to achieve his agenda.

Fed’s Fischer sees little benefit in breaking up too-big banks

  • The Federal Reserve’s new vice chair all but dismissed the idea of breaking up the largest U.S. banks, saying on Thursday it is unclear that such a complex task would help stabilize the country’s financial system.
  • Stanley Fischer also floated the idea of adding a financial stability mandate to all of the U.S. regulators under the umbrella of the Financial Stability Oversight Council (FSOC).

U.S. wholesale inventories rise, point to rebound in second-quarter GDP

  • Wholesale inventories increased 0.5 percent from a month earlier.
  • Inventories are a key component of GDP changes.
  • A sharp slowdown in the pace of restocking by businesses helped to sink economic growth in the first quarter.

EUROPE & WORLD

Portugal’s PM tries to soothe investors; BES says can cover any losses

  • Banco Espirito Santo sought to reassure investors by revealing its exposure to related companies after a missed payment on short-term debt by a member of the Portuguese group roiled global markets.
  • The bank provided the update after a parent company, Espirito Santo International missed payments on commercial paper.
  • Portugal’s regulator banned short selling of Banco Espirito Santo shares until the end of today.

British banks paying $2 billion for swaps mis-selling: regulator

  • Britain’s banks are in the process of paying out 1.2 billion pounds ($2 billion) to compensate small businesses that were mis-sold complex interest rate hedging products.
  • The figure represents about a third of the 3.75 billion pounds set aside by Britain’s four biggest banks.

TODAY in HISTORY

  • Pope Clement VII excommunicated England’s King Henry VIII (1533)
  • Former vice president Aaron Burr fatally wounded former secretary of the treasury Alexander Hamilton in a duel. Hamilton died the following afternoon (1804)
  • The Rev. Dr. Martin Luther King, Jr., was posthumously awarded the Presidential Medal of Freedom for his work to advance civil rights (1977)

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. Sources: Reuters, Bloomberg.

 

Content posted by third parties on this site is screened in order to protect clients’ privacy and comply with regulatory requirements.  Content containing sensitive personal information, inappropriate language, information about specific investments, misleading information, information about other companies or websites, or information related to litigation will be removed.  Content posted by third-parties on this site remains the responsibility of the party posting the content and is not adopted or endorsed by Pence Wealth Management or LPL Financial.  Any opinions or statements posted by third parties are their own and may not be representative of the experience of others and are not indicative of future performance or success.  Third party content on this site does not reflect the views of LPL Financial and have not been reviewed by LPL Financial as to accuracy or completeness.

 

All Financial Consultants at Pence Wealth Management are Registered Representatives with, and securities and Advisory services offered through LPL Financial, a Registered Investment Advisor. Member FINRA & SIPC. Financial Planning offered through Pence Wealth Management, a Registered Investment Advisor and separate entity from LPL Financial. The LPL Financial representative associated with this website may only discuss and/or transact securities business with residents of the following states: Alaska (AK), Alabama (AL), Arkansas (AR), Arizona (AZ), California (CA), Colorado (CO), Delaware (DE), Florida (FL), Georgia (GA), Hawaii (HI), Idaho (ID), Illinois (IL), Kansas (KS), Louisiana (LA), Massachusetts (MA), Michigan (MI), Minnesota (MN), Missouri (MO), North Carolina (NC), New Hampshire (NH), New Jersey (NJ), New Mexico (NM),

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