Business News 05-26-11

Business Summary

The business news focus of Thursday is centered around the GDP revision in the U.S. and the G-8 meeting internationally. However, we’ve Jobless Claims, a consumer metric, foreclosure data and the regular check on commodities and currency here covered.

Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.

Relative Tickers: NYSE: DIA, NYSE: SPY, Nasdaq: QQQQ, NYSE: DOG, NYSE: SDS, NYSE: QLD, NYSE: NYX, NYSE: ICE, Nasdaq: NDAQ, NYSE: RTN, NYSE: CSX, NYSE: OKE, NYSE: JNJ, Nasdaq: SYMC, Nasdaq: RMBS, NYSE: AZO, Nasdaq: BCSI, NYSE: HNZ, NYSE: BIG, NYSE: TIF, Nasdaq: PDCO, NYSE: GU, Nasdaq: CRMT, Nasdaq: ANGN, Nasdaq: BRLI, Nasdaq: CRVL, Nasdaq: DLIA, Nasdaq: VIFL, Nasdaq: FRED, Nasdaq: GMAN, NYSE: HGG, AMEX: ITI, Nasdaq: LAVA, Nasdaq: MRVL, NYSE: MBT, Nasdaq: OCNF, Nasdaq: OVTI, Nasdaq: PRGN, Nasdaq: PDCO, Nasdaq: QADB, Nasdaq: QSII, Nasdaq: ROLL, Nasdaq: RUE, Nasdaq: SENEA, NYSE: SIG, Nasdaq: VSNT and NYSE: WH.

Business News

US Economic Data

Q1 2011 GDP Revision

The Advance Estimate showed GDP only grew at a rate of 1.8%, but economists surveyed by Bloomberg expected the revision to take the rate up to 2.1%. Unfortunately, Ben Bernanke and crew correctly forecasted GDP was going to lean lower, and the report showed economic growth was unchanged at 1.8% in the first quarter. The rest of the day's business news plays second fiddle to GDP today.

Jobless Claims

Weekly Initial Jobless Claims increased in the May 21 period by 10K, to 424K, from the revised prior week period at 414K. The four-week moving average for claims now sits at 438,500, down just slightly. The labor market’s recent retrenchment is only reinforced with every weekly jobless claims figure marking above 400K, and especially when the weekly rate rises.

Bloomberg Consumer Comfort Index

Bloomberg has started reporting its Consumer Comfort Index, a weekly measure of the consumer mood. In this latest reporting, consumer confidence improved, with the index marking negative 48.4 through May 22nd, up from its 9-month low of -49.4 marked in the prior period. Bloomberg speculated that a 12 cent decline in gasoline prices was likely behind the improvement, and we would agree.

Foreclosures

RealtyTrac reported that foreclosures measured 28% of total transactions in the first quarter. That’s up a point from Q4 2010, but down a point from Q1 2010.

Commodities and Forex

Natural Gas Inventory

The EIA’s latest Natural Gas Report covering the period ending May 20 showed a net increase of 105 Bcf from the previous week. Natural gas stores now sit 26 Bcf below their five-year average for this time of year. Stocks were 230 Bcf less than last year. Natural gas futures were down 2.4% on the news.

Oil Prices

WTI Crude Futures were down about 1.5% this morning, just as SocGen published its forecast that oil could reach $106 per barrel. SocGen’s forecast had some basis in last year’s May pullback that was then followed by higher prices. Crude is supposedly benefiting now from a draw-down seen in distillate inventories recently, but I would say that has more to do with refiners doing their best to produce gasoline to replenish stocks impacted by Libyan turmoil. We should rather focus on crude inventories, demand and the dollar when pricing crude!

Dollar / Euro

The euro gained a bit on the dollar this morning, reportedly supported by Chinese demand for Portuguese bailout bonds. You’ll recall that China also had interest in investing in Greece. The euro moved to $1.42, its strongest point in a week. However, the euro is down against most other major currencies today.

Political and Geopolitical

DC Doings

The Senate Banking Committee examines the future of housing finance Thursday.

G-8 Summit

The Group of 8 draws powerhouse national leaders for a summit in France through Friday. President Obama met with the Russians first, as Medvedev pushes for Russian WTO entry.

Corporate Wire

Thursday’s analyst meetings and conference presentations include Raytheon (NYSE: RTN), CSX (NYSE: CSX), Oneok (NYSE: OKE), Johnson & Johnson (NYSE: JNJ), Symantec (Nasdaq: SYMC), Rambus (Nasdaq: RMBS) and Autozone (NYSE: AZO). The EPS schedule includes Blue Coat Systems (Nasdaq: BCSI), H.J. Heinz (NYSE: HNZ), Big Lots (NYSE: BIG), Tiffany (NYSE: TIF), Patterson Cos. (Nasdaq: PDCO), Gushan Environmental (NYSE: GU), America’s Car-Mart (Nasdaq: CRMT), Angeion (Nasdaq: ANGN), Bio-Reference Laboratories (Nasdaq: BRLI), CorVel (Nasdaq: CRVL), dELIA’s (Nasdaq: DLIA), Food Technology Service (Nasdaq: VIFL), Fred’s (Nasdaq: FRED), Gordman’s Stores (Nasdaq: GMAN), HHGregg (NYSE: HGG), Iteris (AMEX: ITI), Magma Design Automation (Nasdaq: LAVA), Marvell Technology (Nasdaq: MRVL), Mobile Telesystems (NYSE: MBT), Oceanfreight (Nasdaq: OCNF), Omnivision Technologies (Nasdaq: OVTI), Paragon Shipping (Nasdaq: PRGN), Patterson Companies (Nasdaq: PDCO), QAD (Nasdaq: QADB), Quality Systems (Nasdaq: QSII), RBC Bearings (Nasdaq: ROLL), rue21 (Nasdaq: RUE), Seneca Foods (Nasdaq: SENEA), Signet Jewelers (NYSE: SIG), Versant (Nasdaq: VSNT) and WSP Holdings (NYSE: WH). This article should also interest SPDR Dow (NYSE: DIA), SPDR S&P 500 (NYSE: SPY), Powershares QQQ (Nasdaq: QQQQ), ProShares Short Dow 30 (NYSE: DOG), ProShares UltraShort S&P 500 (NYSE: SDS), ProShares Ultra Short QQQ (NYSE: QLD), NYSE Euronext (NYSE: NYX), Nasdaq OMX (Nasdaq: NDAQ).

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.