For the week of Monday, May 12, 2014 through Friday, May 16, 2014:
- Standard & Poor’s 500 Index: 0.03%
- Dow Jones Industrial Average: -0.45%
- NASDAQ Composite: 0.53%
Investors snapped up shares of companies large and small Monday, driving major indices to new records. The rally was even able to revive beaten-down tech stocks. The S&P 500 squeezed out its ninth record close of the year. The Dow Jones Industrial Average and the S&P 500 edged higher, reaching fresh records again on Tuesday, as investors maintained their focus on a stable U.S. economy and better-than-expected corporate earnings. However, money managers remained wary of technology stocks, likely worried share prices aren’t justified by these companies’ growth prospects.
By mid-week, stocks retreated on concerns of the slow economic growth. Stocks fell again on Thursday as disappointing results from Wal-Mart Stores (NYSE: WMT) weighed on blue chips, while shares of small companies led the declines. Stocks stepped up in Friday’s session, ramping up late on a variety of economic data. However, consumer confidence is on the wane this month. In a preliminary reading for May, the University of Michigan’s consumer sentiment index slipped from 84.1 to 81.8.
Chain Store Sales Snapshot:
- The Chain Store Sales Index fell 0.1%.
- The fall was a surprise, however, the index is up 3.9% year-over-year.
- The data included the Mother’s Day holiday.
- Warmer weather and falling gasoline prices have increased consumer spending
- Retail sales increased 0.1% in April.
- April sales were flat excluding auto dealers.
- April sales rose 4% year-over-year.
- March was revised up 1.5%.
MBA Mortgage Applications Survey:
- The Mortgage Applications composite index rose 3.6%.
- The purchase index slid 0.1%.
- However, the refinance index rose 6.8%.
Producer Price Index:
- Producer prices increased 0.6% in April.
- Wholesale and retail margins saw strong gains
- Early stages of production saw prices unchanged.
- The year-over-year increase in producer prices rose to 2.1%.
- Initial claims for unemployment insurance slid 24,000 to 297,000.
- This is the first time claims have been under 300,000 since the recovery began.
- The four-week moving average fell from 2,000 to 323,250 for the week.
- Continuing claims fell to 2.667 million.
Consumer Price Index:
- The Consumer Price Index rose 0.3% in April.
- Gasoline prices and food prices helped the headline gains.
- The core consumer price index increased 0.2%.
- Industrial production declined 0.6% in April.
- Normal weather contributed to a 5.3% drop in utilities production.
- Manufacturing output fell 0.4%.
- Mining production increased 1.4%.
Cisco Systems, Inc. (NASDAQ: CSCO)
- Cisco reported profits of $2.2 billion, or $0.42 a share, compared to $2.5 billion, or $0.46 per share last year.
- Excluding one-time items, profits were flat at $0.51, year-over-year.
- Revenue fell 5.5% to $11.5 billion.
- Analysts expected $0.48 per share on revenue of $11.3 billion.
Macy’s, Inc. (NYSE: M)
- Macy’s earned $224 million, or $0.60 per share, compared to $217 million, or $0.55 per share, a year ago.
- Revenue fell 1.7% to $6.28 billion.
- Analysts expected $0.59 a share on revenue of $6.46 billion.
Wal-Mart Stores Inc. (NYSE: WMT)
- Wal-Mart earned $3.59 billion, or $1.11 per share, compared to $3.78 billion, or $1.14 per share, year-over-year.
- Revenue increased to $114.96 billion.
- Analysts expected $1.15 per share on revenue of $116.43 billion.
Kohl’s Corp. (NYSE: KSS)
- Kohl’s earned $125 million, or $0.60 per share, compared to $147 million, or $0.66 per share, a year ago.
- Revenue fell 3.1% to $4.07 billion.
- Analysts expected $0.62 cents a share on revenue of $4.22 billion.
- Same-store sales fell 3.4%.
- The two-year Treasury rate slid two basis points to 0.36%.
- The five-year Treasury rate fell 10 basis points to 1.53%.
- The 10-year Treasury rate decreased 13 basis points to 2.49%.
- The 30-year Treasury yield fell 14 basis points to 3.32%.