US stock futures edge up after steep declines
May 24, 2011, 8:44 a.m. EDT Associated Press
Journal By Calvin Lee Ledsome Sr.,
Hello Reader, What Party Do You Want Running The US Government 2013? Selection Poll B.O.Page!
NEW YORK (AP) — Stock futures rose Tuesday, a day after fears about European debt sparked steep declines in financial markets around the world.
Ahead of the opening bell, Dow Jones industrial average futures are up 39, or 0.3 percent, at 12,401. Standard & Poor’s 500 futures are up 5, or 0.4 percent, at 1,319. Nasdaq 100 futures are up 7, or 0.3, at 2,322.
The modest advance in futures trading came despite more troubling news about the state of European debt management.
Greece‘s main opposition party said it opposed the government’s new austerity measures. The announcement dashed hopes that the country might be able to repair its finances enough to get another loan package from the International Monetary Fund.
Ratings agency Moody’s warned that a Greek restructuring of its debt would constitute a default. Moody’s said such a move would hurt the credit ratings of Greece and other debt-laden European countries. The ratings agency also said it would review 14 British financial institutions for a possible downgrade.
Nonetheless, European stocks recovered Tuesday after Monday’s declines.
The FTSE 100 index of leading British shares rose 0.4 percent in midday trading. Germany’s DAX rose 0.7 percent and the CAC-40 in France was 0.2 percent higher. The euro also rose slightly against the dollar after falling to a two-month low Monday.
In economic news, the Commerce Department is expected to report at 10 a.m. Eastern on how many new homes were bought in April, offering traders a glimpse at the housing market.
Analysts expect sales to have been roughly flat, rising slightly to an annual rate of 303,000 from 300,000 in March. That is still far below the 700,000 in annual sales seen as representing a healthy market.
New homes are unappealing to budget-conscious families because their median price is nearly 31 percent higher than previously-occupied homes. That’s twice the price difference typical of a healthy economy. At their current rate, new-home sales are on track to experience a sixth straight year of declines.
The Dow fell as much as 180 points Monday before paring back some of its losses after Greece, Italy and Spain suffered weekend setbacks in their attempts to control their debt. The Dow fell 130.78 points, or 1 percent, to close at 12,381.26.The S&P 500 index lost 15.90, or 1.2 percent, to 1,317.37. The Nasdaq dropped 44.42, or 1.6 percent, to 2,758.90.
Hello Reader, What Party Do You Want Running The US Government 2013? Selection Poll at B.O.Page!
WASHINGTON (AP) — Americans are growing more optimistic about the U.S. economy, a sentiment that is benefiting President Barack Obama despite public disenchantment with his handling of rising gasoline prices and swollen government budget deficits.
An Associated Press-GfK poll shows that more than 2 out of 5 people believe the U.S. economy will get better, while a third think it will stay the same and nearly a fourth think it will get worse, a rebound from last month’s more pessimistic attitude. And, for the first time since the 100-day mark of his presidency, slightly more than half approve of Obama’s stewardship of the economy.
Both findings represent a boost for Obama, though he still must overcome ill will over government red ink and the price of gas at the pump, now hovering around $4 a gallon.
But the public’s brighter economic outlook also could signal a boost to the current recovery, which relies to a great degree on consumer behavior. A public that is confident about economic performance is more likely to spend more and accelerate the economy’s resurgence.
The poll was conducted May 5-9 in the aftermath of the U.S. commando raid that killed Osama bin Laden, the al-Qaida leader behind the Sept. 11, 2001, terrorist attacks. The spike in public esteem for Obama as a result of that successful clandestine mission may have helped Obama’s standing on issues other than national security.
The poll coincides with renewed attention in Washington to the nation’s growing debt and the federal government’s long-term budget deficits, so any positive signs from the public could help Obama push his policy proposals. A bipartisan team of lawmakers is working with Vice President Joe Biden to identify spending cuts. Meanwhile, lawmakers also are discussing major structural changes to the tax system and to the government’s mammoth benefits programs of Medicare, Medicaid and Social Security.
The results of the AP-GfK poll stood out because other surveys taken after bin Laden’s death, while showing a spike in support for the president, continued to indicate dissatisfaction by a majority for his handling of the economy. Still, like the AP-GfK poll, other surveys also found American attitudes about the state of the nation improving.
Forty-five percent of those polled in the AP-GfK survey said the country was now moving in the right direction, an increase of 10 percentage points from five weeks ago. And attitudes about life in general remained positive, with 4 out of 5 respondents saying they were happy or somewhat happy with their circumstances.
“Once you hit bottom the only one way to go is up,” said John Bair, 23, a photographer and filmmaker from Pittsburgh. “Everybody that I come in contact with seems to be on the upswing. I consider that a pretty good thing.”
But Bair, who describes himself as a moderate to conservative independent, doesn’t believe Obama deserves re-election. He strongly disapproves of the president’s handling of gasoline prices and says Obama should do more to increase domestic production of oil.
“When I’m paying $4 for a gallon of gas, it gets me wondering what’s going on,” he said.
Obama has tried to appear engaged on gas prices even though there is little presidents can do to alter market fluctuations. He has called for new renewable energy policies and for eliminating tax breaks for oil and gas companies, while conceding those steps will not address the current price increases. The efforts have not given the public much to cheer about, however. A total of 61 percent disapprove of Obama’s approach to the rising cost of gasoline.
Indeed, for all the long-term confidence that the economy will recover, the public is hardly upbeat about the current state of things. Only 21 percent describe the economy as good and 73 percent describe it as poor. About 1 in 5 thought the economy got better during the past month; an equal number thought it got worse.
A favorable jobs report last Friday showed that private companies had exceeded expectations by creating 268,000 jobs last month, the third month of at least 200,000 new jobs. And while unemployment has dropped from a high of 10.1 percent nationally in October 2009, it is now 9 percent, the same as in January.
“We haven’t done anything to create the jobs that (Obama) promised —that all of them promised,” said John Grezaffi, 60, a rancher from Pointe Coupee Parish, La.
Grezaffi, taking a short break from working to shore up his land against a rising Mississippi River on Wednesday, said he somewhat supports Obama but does not support his handling of the economy and believes the country is moving in the wrong direction.
Approaching retirement age, he said he wasn’t eager to see his upcoming benefits shortchanged.
“I’m willing to give up a little, but not everything when you see the waste that occurs in so many other areas,” he said.
Deana Floss, 39, a Springfield, Ohio, restaurant cook and owner of a cleaning business, voiced lukewarm approval for Obama even though she doesn’t care for the state of the economy or Obama’s handling of the nation’s budget deficits.
“I don’t think he has done a very bad job with the economy,” she said. “It was already going downhill when he took the reins.”
The Associated Press-GfK Poll was conducted by GfK Roper Public Affairs and Corporate Communications. It involved landline and cell phone interviews with 1,001 adults nationwide and had a margin of sampling error of plus or minus 4.2 percentage points.
___
Associated Press Deputy Polling Director Jennifer Agiesta contributed to this report.
Hello Reader, What Party Do You Want Running The US Government 2013? Poll Below!
WASHINGTON (AP) — The economy slowed sharply in the first three months of the year. High gas prices cut into consumer spending, bad weather delayed construction projects and the federal government slashed defense spending by the most in six years.
The 1.8 percent annual growth rate in the January-March quarter was weaker than the 3.1 percent growth in the previous quarter, the Commerce Department reported. And it was the worst showing since last spring when the European debt crisis slowed growth to a 1.7 percent pace.
Federal Reserve Chairman Ben Bernanke and other economists say the slowdown is a temporary setback. They generally agree that gas prices will stabilize and the economy will grow at a 3 percent pace in each of the next three quarters.
But gas prices are still going up. The housing market has shown little signs of recovering. And lawmakers are proposing some of the steepest cuts in federal spending in a generation. Those cuts would filter down to state and local governments, which are already wrestling with their own budget crises.
“The economy has lost its modest upward momentum, and headwinds such as rising gasoline prices and further budget cuts suggest the recovery will continue at only a moderate pace going forward,” said Sal Guatieri, senior economist at BMO Capital Markets.
The national average for a gallon of gas was $3.88 on Thursday. That’s an increase of 30 cents in the first month of the April-June quarter.
An inflation gauge in the report showed consumer prices rose last quarter at the fastest pace in nearly three years. Most of the increase came from higher fuel costs.
Rising gas prices are draining most of the extra money that Americans are receiving this year from a Social Security payroll tax cut.
That’s a major reason why consumer spending cooled off in the January-March quarter. Consumers boosted spending at a 2.7 percent pace, down from the previous quarter’s 4 percent pace and the weakest since last summer. Consumer spending is important because it accounts for roughly 70 percent of overall economic activity.
“All things considered, it could have been worse,” said economist Paul Dales at Capital Economics. Even though consumers spent less, the pace of spending by historical standards is decent. “Nevertheless, in a quarter when the economy began to benefit from additional monetary and fiscal stimulus, we had originally expected a lot more,” he said.
Pump prices weren’t the only reason spending slowed. Harsh winter weather also kept people from shopping in many parts of the country.
Winter storms — including rare snow that blanketed the South — also forced builders to delay construction projects, a big factor holding back overall economic activity. Builders slashed spending on commercial construction, such as office buildings and factories, at a 21.7 percent annualized pace, the deepest cuts since late 2009.
Residential construction was also affected. Builders cut spending on housing projects by a 4.1 percent annualized rate.
The housing market’s collapse thrust the economy into a deep recession, and economists say it will take years for the industry to heal. Two years after the recession has ended, the housing market remains depressed.
Bernanke suggested at a news conference Wednesday that the crippled housing market will continue to drag on economic growth. He pointed out that home building and commercial construction were both “very weak” in the first quarter. Normally, construction spending is much stronger at this stage of an economic recovery.
The government is also spending less. The federal government cut military spending at an annualized rate of 11.7 percent last quarter — the deepest cut since 2005.
Bernanke and other economists expect government defense spending and consumer spending will rebound in the next quarter.
Economists in a new Associated Press survey predict the economy is growing at a 3.2 percent pace this quarter and that growth will steadily improve over the remainder of the year.
One concern is the rise in prices. An inflation gauge tied to the report showed that consumer prices rose at an annual rate of 3.8 percent. That’s the biggest gain since the summer of 2008, when gasoline prices hit a record high of $4.11 a gallon nationwide.
Stripping out energy and food prices, inflation rose at a rate of 1.5 percent. That’s at the low end of the range of inflation the Federal Reserve believes is needed for a healthy economy.
Poll: US economy improving despite global events
Posted by Calvin Lee Ledsome Sr.,
Owner and Founder of: http://economicnewsblog.wordpress.com
Hello, Who Do You Want As The Next USA President? Poll Below!
WASHINGTON (AP) — Economists say the U.S. economy is gaining strength despite political unrest in North Africa and the Middle East and last month’s devastating earthquake and tsunami in Japan.
A survey from the National Association for Business Economics finds that economists are hopeful that the broader economy is substantially improving, with rising employment reported for the fifth quarter in a row. The survey found that “companies appear to be positioning themselves for a firming economic environment,” said Shawn DuBravac, an economist with the Consumer Electronics Association, who analyzed the findings.
The outlook for employment rose slightly, reaching a 12-year high. No firms reported significant layoffs, with the only reductions coming from already planned cuts.
Sales increased for the third consecutive quarter, profit margins continued to improve and the number of economists whose firms increased spending over the previous quarter held steady. Nearly all of the 72 economists surveyed, about 94 percent, now expect the economy to grow at least 2 percent in 2011.
The quarterly survey includes the views of economists for private companies and trade groups who are NABE members. The data are reported by broad industry groupings. Many results in the survey are expressed through the Net Rising Index, or NRI — the percentage of panelists reporting better outlooks minus the percentage whose outlook is bleaker.
The survey looked at two new questions for its April survey, gauging the financial impact of anti-government unrest in the Arab world and the deadly Japanese earthquake and tsunami.
Nearly 60 percent of those polled said they expected higher costs because of political turmoil in Bahrain, Egypt, Tunisia, Libya and Syria and about 52 percent said they expected economic growth to be weaker in 2011 because of the protests and fighting.
The March 11 earthquake and tsunami, which left nearly 28,000 people dead or missing and sparked a crisis at a nuclear plant, had less of an impact on the economic forecasts. About 31 percent said costs would be higher and 40 percent said it would weaken the broader economic recovery.
In the first quarter of this year, 63 percent of economists said sales rose from the previous quarter — the highest percentage since 1994. The NRI rating for sales rose 11 points from the previous quarter to 54, and the improvement was across all industry sectors: goods, utilities, information and communications, finance, insurance and real estate, and services.
Profit margins rose to an NRI figure of 31 — the highest rating since 1983. The number of economists reporting rising profits has almost doubled over the past year, to 45 percent from 25 percent.
Prices rose, with about one third of those surveyed saying their firms had made increases over the past three months. Two-thirds of the goods-producing industry, which includes farming, mining, construction and manufacturing, reported their firms had raised prices. Similarly, the costs paid for materials rose for the third quarter in a row and wages and salaries jumped to the highest reading since a survey in October 2007.
