Monthly Archives: January 2013

1-25-2013 Update

The S&P 500 Index is up approximately 4% year to date, having reached a 5-year high.  Global equities also did well, lifted by China’s GDP of 7.9% in the fourth quarter. Also, industrial output and retail sales continue to accelerate. The strength of U.S. holiday retail sales suggest that the fiscal cliff — and the risk of higher taxes — did not deter consumers. December retail sales were up 0.5%, ahead of the 0.2% forecast. Continue reading

1-18-2013 Update

The big news this week (besides the unfortunate stories about the Boeing Dreamliner and Lance Armstrong) has been earnings.  Thus far, it appears that U.S. corporations as a whole continued to grow their earnings in the 4th quarter of 2012 even as the “fiscal cliff” uncertainty plagued headlines.  Many corporations are still benefiting from cost efficiencies and appear somewhat reluctant to increase capital expenditures.  However, corporations will not be able to maintain profit growth going forward by continuing to deleverage and they will eventually be forced to focus on organic growth, which will require increasing capital expenditures (hiring and technology).  We are starting to see this happen and this is evident with the gradually improving labor market.   Certainly, clarity out of Washington would help expedite this process. Continue reading

Corporate Earnings Season Kicks Off – 1/11/13

We are heading into the heart of earnings season next week. Thus far the few companies that have reported have posted good results. We are interested to hear how the uncertainty over the fiscal cliff impacted sales and spending decisions in the fourth quarter for U.S. businesses. It will also be interesting to hear the CEO comments on how the impending debt ceiling negotiations will impact their hiring and capital investment decisions for 2013. Continue reading

Market Commentary: Fourth Quarter 2012

2012 produced a continued “slow turn upward” in the U.S. economy.  This along with reduced fears of a hard landing in China and a glimmer of hope in Europe provided the building blocks of a very good year for equities in 2012.  Investors may end up remembering 2012 for what didn’t happen: Greece survived the year and did not exit the euro, China did not see a sharp decline in economic growth and the U.S. did not fall off the fiscal cliff.  The S&P 500 Index rose 13.41% in 2012, the Dow Jones Industrial Average gained 7.26% and the Nasdaq Index rose 15.91%.  The Barclays U.S. Aggregate Bond Index rose 4.22%. The Russell 2000 (small cap stocks) gained 16.35% and the MSCI Emerging Markets Index rose 15.15%. Continue reading

1/4/13

2012 produced a continued “slow turn upward” in the U.S. economy.  This along with reduced fears of a hard landing in China and a glimmer of hope in Europe provided the building blocks of a very good year for equities in 2012.  Investors may end up remembering 2012 for what didn’t happen: Greece survived the year and did not exit the euro, China did not see a sharp decline in economic growth and the U.S. did not fall off the fiscal cliff.  The S&P 500 Index rose 13.41% in 2012, the Dow Jones Industrial Average gained 7.26% and the Nasdaq Index rose 15.91%.  The Barclays U.S. Aggregate Bond Index rose 4.22%. The Russell 2000 (small cap stocks) gained 16.35% and the MSCI Emerging Markets Index rose 15.15%. Continue reading