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The Wall Street Greek blog is the sexy & syndicated financial securities markets publication of former Senior Equity Analyst Markos N. Kaminis. Our stock market blog reaches reputable publishers & private networks and is an unbiased, independent Wall Street research resource on the economy, stocks, gold & currency, energy & oil, real estate and more. Wall Street & Greece should be as honest, dependable and passionate as The Greek.



Wall Street, business & other videos updated regularly...

Seeking Alpha

Friday, April 01, 2016

WARNING - This Jobs Report Could be Sketchy

danger
Recent economic data for February has been downright disconcerting. There is reason to believe the Employment Situation Report for March might be as well, given that hiring decisions likely lag. But is bad news good news or vice versa? After all, if hiring in March fell just a little short of expectations it might serve investors hoping for an extension of the Fed’s free money policy. But if it was lousy, you had better buckle up, because economic recession fear trumps Fed dovishness in terms of factor influence. See more of this report here: Buckle Up - This Jobs Report Could be Sketchy.

Security Sector
03-31-16 3:00
SPDR S&P 500 (NYSE: SPY)
-0.2%
SPDR Dow Jones (NYSE: DIA)
-0.2%
PowerShares QQQ (Nasdaq: QQQ)
-0.2%
iShares Russell 2000 (NYSE: IWM)
+0.3%
Vanguard Total Stock Market (NYSE: VTI)
-0.1%
Financial Select Sector SPDR (NYSE: XLF)
-0.2%
Technology Select Sector SPDR (Nasdaq: XLK)
-0.2%
Energy Select Sector SPDR (NYSE: XLE)
-0.1%
Health Care Select Sector SPDR (NYSE: XLV)
-0.3%
Consumer Discretionary Select Sector SPDR (NYSE:  XLY)
-0.1%
Consumer Staples Select Sector SPDR (NYSE: XLP)
-0.5%
Utilities Select Sector SPDR (NYSE: XLU)
+0.6%
Materials Select Sector SPDR (NYSE: XLB)
-0.8%
Industrial Select Sector SPDR (NYSE: XLI)
-0.2%
iPath S&P 500 VIX ST Futures (NYSE: VXX)
+0.6%
SPDR Gold Trust (NYSE: GLD)
+0.5%
United States Oil (NYSE: USO)
-0.3%

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. Article should interest investors in Paychex (Nasdaq: PAYX), Manpower (NYSE: MAN), Robert Half International (NYSE: RHI), 51Job Inc. (Nasdaq: JOBS), Monster World Wide (NYSE: MWW), Korn/Ferry International (NYSE: KFY), Administaff (NYSE: ASF), Kforce (Nasdaq: KFRC), TrueBlue (NYSE: TBI), Dice Holdings (NYSE: DHX), Kelly Services (Nasdaq: KELYA), CDI Corp. (NYSE: CDI), Cross Country Healthcare (Nasdaq: CCRN), On Assignment (Nasdaq: ASGN), AMN Healthcare Services (NYSE: AHS), Barrett Business Services (Nasdaq: BBSI), Hudson Highland Group (Nasdaq: HHGP), StarTek (NYSE: SRT), RCM Technologies (Nasdaq: RCMT), VirtualScopics (Nasdaq: VSCP), American Surgical (OTC: ASRG.OB), Medical Connections (OTC: MCTH.OB), iGen Networks (OTC: IGEN.OB), St. Joseph (OTC: STJO.OB), General Employment Enterprises (NYSE: JOB), Total Neutraceutical (OTC: TNUS.OB), TeamStaff (Nasdaq: TSTF), Stratum (OTC: STTH.PK), Purespectrum (OTC: PSRU.OB), Corporate Resource Services (OTC: CRRS.OB), Bank of America (NYSE: BAC), J.P. Morgan Chase (NYSE: JPM), Goldman Sachs (NYSE: GS), Citigroup (NYSE: C), Morgan Stanley (NYSE: MS), Wells Fargo (NYSE: WFC), TD Bank (NYSE: TD), PNC Bank (NYSE: PNC), General Electric (NYSE: GE), Wal-Mart (NYSE: WMT), McDonald's (NYSE: MCD), Alcoa (NYSE: AA), American Express (NYSE: AXP), Boeing (NYSE: BA), Caterpillar (NYSE: CAT), Cisco Systems (Nasdaq: CSCO), Chevron (NYSE: CVX), DuPont (NYSE: DD), Walt Disney (NYSE: DIS), Home Depot (NYSE: HD), Hewlett-Packard (NYSE: HPQ), IBM (NYSE: IBM), Intel (Nasdaq: INTC), Johnson & Johnson (NYSE: JNJ), Kraft (NYSE: KFT), Coca-Cola (NYSE: KO), 3M (NYSE: MMM), Merck (NYSE: MRK), Microsoft (Nasdaq: MSFT), Pfizer (NYSE: PFE), Procter & Gamble (NYSE: PG), AT&T (NYSE: T), Travelers (NYSE: TRV), United Technologies (NYSE: UTX), Verizon (NYSE: VZ), Exxon Mobil (NYSE: XOM).

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Wednesday, December 30, 2015

What Does U.S. Investor Confidence Drop Mean for 2016?

investor confidence
State Street (NYSE: SST) reports monthly on global investor confidence and this month’s report showed confidence waned in the United States in December. Confidence rose in Europe and Asia, taking the global measure up with it, but what does the drop in the U.S. mean for American investors as we head into 2016? Learn more about investor confidence and what it means here.

Regionally Speaking
December Change
December Level
Global Confidence
+1.0
108.3
North American
-5.9
106.6
Europe
+7.5
103.7
Asia
+4.6
105.1

Sector Security
Nov 27 – Dec 28
Vanguard Total Stock Market (NYSE: VTI)
-1.9%
SPDR S&P 500 (NYSE: SPY)
-1.5%
PowerShares QQQ (Nasdaq: QQQ)
-1.3%
Energy Select Sector SPDR (NYSE: XLE)
-10%
SPDR S&P Oil & Gas E&P (NYSE: XOP)
-19%
Market Vectors Oil Services (NYSE: OIH)
-11%
Materials Select Sector SPDR (NYSE: XLB)
-3.3%
Industrial Select Sector SPDR (NYSE: XLI)
-2.6%

DISCLOSURE: Kaminis is long XLE. 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. Article should interest investors in SPDR Dow Jones Industrial Average (NYSE: DIA), SPDR S&P 500 (NYSE: SPY), PowerShares QQQ Trust (Nasdaq: QQQ), ProShares Short Dow 30 (NYSE: DOG), ProShares Ultra Short S&P 500 (NYSE: SDS), ProShares Ultra QQQ (NYSE: QLD), NYSE Euronext (NYSE: NYX), The NASDAQ OMX Group (Nasdaq: NDAQ), Intercontinental Exchange (NYSE: ICE), E*Trade Financial (Nasdaq: ETFC), Charles Schwab (Nasdaq: SCHW), Asset Acceptance Capital (Nasdaq: AACC), Affiliated Managers (NYSE: AMG), Ameriprise Financial (NYSE: AMP), TD Ameritrade (Nasdaq: AMTD), BGC Partners (Nasdaq: BGCP), Bank of New York Mellon (NYSE: BK), BlackRock (NYSE: BLK), CIT Group (NYSE: CIT), Calamos Asset Management (Nasdaq: CLMS), CME Group (NYSE: CME), Cohn & Steers (NYSE: CNS), Cowen Group (Nasdaq: COWN), Diamond Hill Investment (Nasdaq: DHIL), Dollar Financial (Nasdaq: DLLR), Duff & Phelps (Nasdaq: DUF), Encore Capital (Nasdaq: ECPG), Edelman Financial (Nasdaq: EF), Equifax (NYSE: EFX), Epoch (Nasdaq: EPHC), Evercore Partners (NYSE: EVR), EXCorp. (Nasdaq: EZPW), FBR Capital Markets (Nasdaq: FBCM), First Cash Financial (Nasdaq: FCFS), Federated Investors (NYSE: FII), First Marblehead (NYSE: FMD), Fidelity National Financial (NYSE: FNF), Financial Engines (Nasdaq: FNGN), FXCM (Nasdaq: FXCM), Gamco Investors (NYSE: GBL), GAIN Capital (Nasdaq: GCAP), Green Dot (Nasdaq: GDOT), GFI Group (Nasdaq: GFIG), Greenhill (NYSE: GHL), Gleacher (Nasdaq: GLCH), Goldman Sachs (NYSE: GS), Interactive Brokers (Nasdaq: IBKR), INTL FCStone (Nasdaq: INTL), Intersections (Nasdaq: INTX), Investment Technology (NYSE: ITG), Invesco (NYSE: IVZ), Jefferies (NYSE: JEF), JMP Group (NYSE: JMP), Janus Capital (NYSE: JNS), KBW (NYSE: KBW), Knight Capital (NYSE: KCG), Lazard (NYSE: LAZ), Legg Mason (NYSE: LM), LPL Investment (Nasdaq: LPLA), Ladenburg Thalmann (AMEX: LTS), Mastercard (NYSE: MA), Moody’s (NYSE: MCO), MF Global (NYSE: MF), Moneygram (NYSE: MGI), MarketAxess (Nasdaq: MKTX), Marlin Business Services (Nasdaq: MRLN), Morgan Stanley (NYSE: MS), MSCI (Nasdaq: MSCI), MGIC Investment (NYSE: MTG), NewStar Financial (Nasdaq: NEWS), National Financial Partners (NYSE: NFP), Nelnet (NYSE: NNI), Northern Trust (Nasdaq: NTRS), NetSpend (Nasdaq: NTSP), Ocwen Financial (NYSE: OCN), Oppenheimer (NYSE: OPY), optionsXpress (Nasdaq: OXPS), PICO (Nasdaq: PICO), Piper Jaffray (NYSE: PJC), PMI Group (NYSE: PMI), Penson Worldwide (Nasdaq: PNSN), Portfolio Recovery (Nasdaq: PRAA), Raymond James (NYSE: RJF), SEI Investments (Nasdaq: SEIC), Stifel Financial (NYSE: SF), Safeguard Scientifics (NYSE: SFE), State Street (NYSE: STT), SWS (NYSE: SWS), T. Rowe Price (Nasdaq: TROW), Visa (NYSE: V) and Virtus Investment Partners (Nasdaq: VRTS)..

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Friday, November 06, 2015

Stock Market Read - Sink or Swim on the Jobs Report?

Stocks are likely to mostly slip in early trading Friday after a strong monthly jobs report was published. Positive economic data signals lead investor expectations toward a Fed rate action for December, which while perhaps appropriate is still unsavory for most companies and for good reason. Fear not, though, as this early indicator only has so much punch. Given the fact that the Fed December meeting is still a ways away, and given the seasonal influence of capital flows, I expect stocks to bounce back. I’m looking at the $208 level on the SPDR S&P 500 (NYSE: SPY) as a test point for any declne Friday, and that is where I expect stocks should stabilize and bounce back from. Keep in mind that the important financial sector mostly benefits from higher interest rates and acts as a counterbalance to other equity softness, limiting today’s impact. Also remember that a strong economy justifies higher interest rates and is the best of all long-term drivers for stocks. Though, until the December Fed meeting today’s data point places a cap on the stock market’s upside potential. Keep in mind that more data (economic and other) will follow that could change the dynamics. See the full report on the stock market here.

Market Sectors & Specific Issues
11-06-15 Early Trade
SPDR S&P 500 (NYSE: SPY)
-0.1%
SPDR Dow Jones (NYSE: DIA)
+0.2%
PowerShares QQQ (Nasdaq: QQQ)
-0.1%
iShares Russell 2000 (NYSE: IWM)
-0.2%
Financial Select Sector SPDR (NYSE: XLF)
+1.7%
PowerShares DB US Dollar Bullish (NYSE: UUP)
+1.2%
iShares Nasdaq Biotech (Nasdaq: IBB)
-0.4%

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.

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Tuesday, November 03, 2015

Stocks – Day of Reckoning is Here

easy does it stocks
Stocks soared in October as far as the laymen can see, but active investors are all too well aware of the struggle it took to get this far. This first week of November brings with it an influential economic data point that the Fed is paying close attention to. As a result, investment direction is hinged to it as well, but is good news good news or is bad news good news, and how bad is too bad? These are some of the questions investors will want to work out on Friday on yet another day of reckoning. See the full report on the day of reckoning here.

Sector Securities
October Price Performance
SPDR S&P 500 (NYSE: SPY)
+8.5%
SPDR Dow Jones (NYSE: DIA)
+8.6%
PowerShares QQQ (Nasdaq: QQQ)
+11.4%
iShares Russell 2000 (NYSE: IWM)
+5.6%
Vanguard Total Stock Market (NYSE: VTI)
+7.9%
PowerShares DB US Dollar Bullish (NYSE: UUP)
+0.6%
SPDR Gold Trust (NYSE: GLD)
+2.2%
iPath S&P GSCI Oil (NYSE: OIL)
+1.5%
iShares Nasdaq Biotechnology (NYSE: IBB)
+7.3%

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.

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Wednesday, October 07, 2015

Export Decline - Fed Crack Addicts Can't Get Enough

Key economic data, the International Trade Report for the month of August, showed a severe drop in exports this week. Does this mean the economic impact of China, the emerging markets, and maybe Europe, is worse than traders hooked on hope for a Fed-rate action need it to be? Are we in danger of entering recession, which would change the game altogether and send stocks into a bear market? This is something we need to be considering, despite my own inclination to buy on the Fed indication. See the full report on the decline in exports here.

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. Article should interest investors in J.P. Morgan Chase (NYSE: JPM), Goldman Sachs (NYSE: GS), Citigroup (NYSE: C), Morgan Stanley (NYSE: MS), Wells Fargo (NYSE: WFC), TD Bank (NYSE: TD), PNC Bank (NYSE: PNC), State Street (NYSE: STT), Janus (NYSE: JNS), T. Rowe Price (Nasdaq: TROW), General Electric (NYSE: GE), Wal-Mart (NYSE: WMT), McDonald's (NYSE: MCD), Alcoa (NYSE: AA), American Express (NYSE: AXP), Boeing (NYSE: BA), Caterpillar (NYSE: CAT), Cisco Systems (Nasdaq: CSCO), Chevron (NYSE: CVX), DuPont (NYSE: DD), Walt Disney (NYSE: DIS), Home Depot (NYSE: HD), Hewlett-Packard (NYSE: HPQ), IBM (NYSE: IBM), Intel (Nasdaq: INTC), Johnson & Johnson (NYSE: JNJ), Kraft (NYSE: KFT), Coca-Cola (NYSE: KO), 3M (NYSE: MMM), Merck (NYSE: MRK), Microsoft (Nasdaq: MSFT), Pfizer (NYSE: PFE), Procter & Gamble (NYSE: PG), AT&T (NYSE: T), Travelers (NYSE: TRV), United Technologies (NYSE: UTX), Verizon (NYSE: VZ), Exxon Mobil (NYSE: XOM), Paychex (Nasdaq: PAYX), Manpower (NYSE: MAN), Robert Half International (NYSE: RHI), 51Job Inc. (Nasdaq: JOBS), Monster World Wide (NYSE: MWW), Korn/Ferry International (NYSE: KFY), Administaff (NYSE: ASF), Kforce (Nasdaq: KFRC), TrueBlue (NYSE: TBI), Dice Holdings (NYSE: DHX), Kelly Services (Nasdaq: KELYA), SFN Group (NYSE: SFN), CDI Corp. (NYSE: CDI), Cross Country Healthcare (Nasdaq: CCRN), On Assignment (Nasdaq: ASGN), AMN Healthcare Services (NYSE: AHS), Barrett Business Services (Nasdaq: BBSI), Hudson Highland Group (Nasdaq: HHGP), StarTek (NYSE: SRT), RCM Technologies (Nasdaq: RCMT), VirtualScopics (Nasdaq: VSCP), General Employment Enterprises (NYSE: JOB) and TeamStaff (Nasdaq: TSTF).

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Monday, October 05, 2015

Should we be Worried about the Deep Drop of Chicago PMI into Contraction Territory?

On Wednesday, the Institute for Supply Management (ISM) reported its Chicago PMI data and it was troubling. The index of regional manufacturing fell to a level indicative of economic contraction. It’s not the first time this year for an underwater result, though we note that the economy has grown generally despite softness in this data point. Still, the depth of decline in September raises a specter of doubt about the impact of the China slowdown, European issues and U.S. energy sector woes on our economy. Whatever the cause, there may be reason for concern about the American economy, though we may have to wait for another month or two of data to determine whether that is true or not. Even so, more data is due Thursday on the American and Chinese economies that could confirm concerns and alter the path of stocks from Wednesday’s appreciation to something else. See the report analyzing Chicago PMI here.

Article interests SPDR S&P 500 (NYSE: SPY), SPDR Dow Jones (NYSE: DIA), PowerShares QQQ (Nasdaq: QQQ), iPath S&P 500 VIX (NYSE: VXX), SPDR Gold Trust (NYSE: GLD), PowerShares DB US Dollar Bullish (NYSE: UUP). 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.

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What does the Sudden Drop in Mortgage Activity mean for Real Estate?

Mortgage applications declined sharply in the just reported period. Given what’s going on today in financial markets, and some recently poor signs in other housing data, I thought we should examine and discuss whether this is a warning sign for real estate or not. In the end, a simple explanation looks like the culprit behind the decline, and it is not one that worries me about real estate moving forward. See the report on mortgage applications and what the dip means. 

Real Estate Relative Shares
09-30-15 Intraday
iShares US Real Estate (NYSE: IYR)
+0.4%
MGIC Investment (NYSE: MTG)
+0.1%
Bank of America (NYSE: BAC)
+0.4%
SPDR S&P Homebuilders (NYSE: XHB)
+0.8%
PulteGroup (NYSE: PHM)
-0.3%
D.R. Horton (NYSE: DHI)
+0.6%
Ryland (NYSE: RYL)
-1.9%
Toll Brothers (NYSE: TOL)
+0.03%
Lennar (NYSE: LEN)
+1.2%

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.

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Thursday, September 24, 2015

Investors Need to Understand this About Durable Goods Orders

After the Durable Goods Orders data was reported this morning, I noticed a notable downshift in S&P 500 futures. Investors are quick to perceive bad news where it may not necessarily be these days. This data point was expected to be bad on the headline, and it was, but when excluding transportation it was relatively unchanged though still short of expectations. Now transportation does include rail, and rail is integrally tied to the energy industry today, so perhaps there is a fire after all. It all depends on how low you anticipate energy prices to fall and for how long. And it also depends on how deep you expect the damage to reach, because as of today, a good portion of our economy is still benefiting from lower energy prices. Low oil prices may be bad for the energy sector and portions of manufacturing but it’s still probably a net push or positive for the overall American economy. A slowing China, volatile Europe and frenzied emerging markets along with questionable export environment, however, exacerbate concern. Still, the Fed remains accommodative; we just wish they would say so a little more clearly. Now let’s examine the important takeaways from today’s Durables data. See the full report on Durable Goods Orders here.

Market Sector Security
09-24-15 Open
SPDR S&P 500 (NYSE: SPY)
-1.0%
SPDR Dow Jones (NYSE: DIA)
-1.1%
Industrial Select Sector SPDR (NYSE: XLI)
-1.8%
iShares Russell 2000 (NYSE: IWM)
-0.8%
Vanguard Total Stock Market (NYSE: VTI)
-1.0%
iPath S&P 500 ST Futures (NYSE: VXX)
+5.1%

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.

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Thursday, February 05, 2015

De Blasio's Blunder & Chris Christie's Crackup Screwed Up the Jobs Report

Regarding the Jobless Claims Report that showed claims lower than expected this week, which some in the media are pointing to as a reason to rally this morning; remember that worst blizzard in history thing? Yeah, well, no matter how weakly it panned out for much of the Northeast, thanks to the perhaps panicked actions of critically important governors and mayors it still paralyzed people across the most congested region of this nation. In Boston and parts of Long Island it actually did snow a lot and kept people indoors too. As a result, the phantom storm likely kept a good number of people from making it to report their loss of employment. And there’s a good reason for the prior week’s weakness as well, so I suggest looking to a different catalyst today if you want a real reason to buy stocks. See our full jobless claims report here. Article matters to SPDR S&P 500 (NYSE: SPY), Vanguard Total Market (NYSE: VTI), Robert Half (NYSE: RHI), Monster Worldwide (NYSE: MWW).

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.

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Wednesday, December 31, 2014

Energy Sector Layoffs Could Alter Labor Data Trends

When Jobless Claims were reported down sharply last Wednesday, one might have felt compelled to attribute it to the season. However, there’s no arguing against the long-term trend for claims. It clearly shows tangible and impressive improvement in the labor market. However, recently halved oil prices have energy companies reducing their spending plans for 2015, and that means layoffs are coming. See our report on the energy sector impact on the labor market here. Interests SPDR S&P 500 (NYSE: SPY), SPDR Dow Jones (NYSE: DIA), PowerShares QQQ (Nasdaq: QQQ), Energy Select Sector SPDR (NYSE: XLE), SPDR S&P Oil & Gas Exploration & Production (NYSE: XOP), Exxon Mobil (NYSE: XOM) and Chevron (NYSE: CVX).

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Monday, October 13, 2014

Have No Fear About the Consumer Confidence Drop

When the Conference Board reported Consumer Confidence for the month of September, some on the Street worried about the so-called bad news. But, dear friends, don’t fret, as consumer spending will not reflect this decrease. We have much more important things to worry about out here on the battleground anyway. See our full report on consumer confidence here. This article matters to investors in Wal-Mart (NYSE: WMT), Amazon.com (Nasdaq: AMZN), SPDR S&P Retail (NYSE: XRT) and Consumer Discretionary Select Sector SPDR (NYSE: XLY).

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Friday, December 13, 2013

Astounding Retail Sales Justify Fed Taper

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Retail sales were reported for the month of November Thursday and they were astounding. It reflects a very strong start to the holiday shopping season, and shows all around better consumer spending activity. It also offers the Fed all the more reason to begin tapering back asset purchases, but it justifies it as well, so it should make Fed action easier to swallow. Let’s take a closer look at this stellar economic report. Visit our blog for more like this.

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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.

Retail Sales


Upward Revision to October

The prior month’s sales data was revised higher, and the revisions extended across the board. This is not always good news, because it could lead to a slower growth rate for the reported month, since the base that growth is calculated upon is raised. However, that was not the case Thursday, as the prior month’s upward revision joined the current month’s positive surprise in uplifting hope.


Revised Oct. Change
Initial October Data
Retail Sales M/M Change
+0.6%
+0.4%
Retail Sales Less Autos
+0.5%
+0.2%
Retail Sales Less Autos & Gas
+0.6%
+0.3%

As you can see, previously reported headline retail sales were increased two-tenths to +0.6% for October. When we exclude automobile and gasoline sales, growth shows up even better, improved by three-tenths of a percentage point. So this is good news about the pre-holiday period. It’s even more impressive if we recall the federal fiscal chaos that enveloped the headlines in early October as the government shut down and the debt ceiling debate threatened to derail the American economy. Those key factors did have a detrimental impact upon reported consumer sentiment trends through the month. Yet, as Thursday’s data shows, real spending came through okay.

November’s Good News


November Change
Economists’ Consensus
Retail Sales M/M Change
+0.7%
+0.6%
Retail Sales Less Autos
+0.4%
+0.3%
Retail Sales Less Autos & Gas
+0.6%
+0.2%

Despite the upward revisions to October’s data, growth exceeded economists’ expectations across the board in November. The numbers were more than just better than expectations; they were strong in absolute terms as well. November retail sales growth of 0.7% beat the economists’ very positive outlook, but when excluding strong auto sales and gasoline, they blew away the economists’ consensus and remained robust in absolute terms at +0.6%.

I caught a so-called expert criticize the report on financial television Thursday. He expressed his view that retail sales are strong, but retailers’ individual earnings have been poor. He vaguely suggested that this was because of necessary discounting and reflected a generally poor retail environment. While I agree that the retail store capacity of the United States has typically been oversaturated over the last decade, I cannot find much fault with the latest retail sales report. And it is well-established now that American consumers are deal seekers.

I do believe that the earlier discounting of retailers may have helped pull forward a larger portion of seasonal sales than usual though. Opening on Thanksgiving like Wal-Mart (NYSE: WMT) and Target (NYSE: TGT) did and the beginning of discounting even earlier than that, along with ongoing daily deals from the likes of Best Buy (NYSE: BBY) and others, have certainly helped frontload seasonal sales. I think you can see that in the year-to-year comparisons. Sales were 4.7% greater in this year’s November versus last year, and they were up 4.1% for the September through November period.

Looking at the retail segments, autos were especially strong, with those sales up 1.8% in November and 10.9% against the prior year period. The strong November was already noted by Ford (NYSE: F) shares though because of the monthly motor vehicle sales data reported earlier this month, so auto stocks hardly reacted to the news Thursday.

Gasoline stations posted a 1.1% decline in sales for the month and a 3.3% drop from the prior year period. This activity is always dictated by the volatile price of the commodity. We can see that the auto and gasoline sales trends offset one another, and so the headline comparisons nearly matched the change in the adjusted figure that excludes these two important retail segments.

Online sales are of great interest to us, given their growing importance and the rising prominence of players in the market like Amazon.com (Nasdaq: AMZN). The sales of “nonstore retailers,” which also include exclusive catalog sellers but are mostly driven by online retailers these days, increased 2.2% in November and were up 9.4% against the prior year. The faster pace of growth reflects the still increasing importance of Internet retailers and their steady market share gains. That trend is driven by the ease of online shopping and the often better pricing of goods online.

Another positive sign for consumer spending was evident in the 1.3% higher sales of food services and drinking places in November, and 5.2% year-to-year increase. The outsized gain in sales for this segment is important, as we believe it offers evidence of casual dining gains. Eating at Darden Restaurants’ (NYSE: DRI) Olive Garden is relatively inexpensive, but it’s probably still more expensive than eating in. Eating at McDonalds (NYSE: MCD) is another story, thanks to its expanding dollar menu. I think the growth in this segment more likely reflects a return of consumer spending following improving labor trends.

Real estate enthusiasts will be happy to note the 1.8% month-to-month and 5.3% year-to-year sales growth in building materials stores. Add to that the 1.2% and 9.7% sales growth at furniture and home furnishings stores and we have real reason to celebrate. Not only are home sales increasing, but people are actually furnishing and repairing them.

SPY chart


The retail sales data on Thursday hardly lifted stocks, which were on the decline of late due to rising concern about Fed tapering and next week’s meeting of the U.S. central bank. Still, the slide in the SPDR S&P 500 (NYSE: SPY) did stall on the day, and that might have been because of the especially positive retail sales result. It is yet another data point offering evidence that the Fed might be justified in tapering back asset purchases now, and that the economy can stand on its own even so.

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.

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Tuesday, April 02, 2013

Why the Week’s 4.7% Same-Store Sales Growth is Misleading

TalbotsBy The Greek:

It sounds fantastic! Retailers reported weekly same-store sales increased by 4.7% week-to-week in the period ending March 30. That is great news right? No, it’s not, and here’s why.

The International Council of Shopping Centers (ICSC) reported same-store sales rose 4.7% week-to-week in the March 30 period. On a year-over-year basis, sales were up 1.9%, though Redbook saw the yearly comparison for the period even better, at plus 3.5%. Perhaps readers suspect we might pooh-pooh the news by attributing the sales growth to discounters like Wal-Mart (NYSE: WMT) or to online sellers like Amazon.com (Nasdaq: AMZN), due to their stealing of market share from the Macy’s (NYSE: M) and J.C. Penney’s (NYSE: JCP) of the world. No, that’s not it. So what’s wrong with the numbers then?

Well, a peak at the prior week’s results offers a clue. In the week ending March 23, the ICSC reported same-store sales were down 1.7% week-to-week. The yearly comparisons were likewise poor, with sales only 1.0% higher according to the ICSC and 2.6% higher according to Redbook. The reason is really rather simple.

It’s about the Easter holiday and where it sits on the calendar this year versus last year. This year, Easter fell on March 31st, and last year it fell on April 8th. Sales were strong in the week of Easter and Passover because of the surge of seasonal sales tied to the holidays, not all of which are accounted for perfectly. Consider all the flowers 1-800-Flowers.com Inc. (Nasdaq: FLWS) sells and all the Easter Baskets CVS Caremark (NYSE: CVS) sells, all the Easter Bonnets Macy’s (M) sells and all the new dresses J.C. Penney (JCP) sells. Let’s not forget the Easter and Passover meals that lead families to gather together, and the necessary shopping at Kroger’s (NYSE: KR) and Whole Foods Market (NYSE: WFM).

For this reason sales picked up in the week before Easter as they do every year. From this understanding, we garner insight about next week as well, because last year the week incorporated Easter shopping and this year it will not. Thus, these same-store sales reports should show poor comparable results on a weekly and yearly basis when reported next Tuesday.

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.

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