Financial News and Notes 1/15/11 – 1/21/11

Economy

-China’s GDP fell to 8.9% in the 4th quarter of 2011, which is below its average of 10% a year over the past 30 years, but indicates that growth is slowing in the world’s second largest economy.  1/17

-The New York manufacturing index rose in January for the fourth consecutive month showing expansion and it is at its highest level since last April.  1/18

-The World Bank dropped its forecast of global growth for 2012 to 5.4% from 6.2% for emerging markets and to 1.4% from 2.7% from developed markets.  1/18

– A survey of homebuilders reflected the highest confidence level in the industry since June of 2007.  1/19

-Wholesale prices fell 0.1% in December driven by falling food and energy prices, but core prices rose 0.3%.  1/19

-The CPI was flat in December bringing the trailing year increase to 3%.  1/20

-Jobless claims dropped 50,000 to close to a 4 year low of 352,000, continuing the trend of decelerating unemployment claims. 1/20

-Sales of previously owned homes rose to an 11 month high in December and lowered supply to its lowest level since 2006.  However prices fell 2.5% from a year earlier.  1/21

Corporate

-Jerry Yang, the founder of Yahoo, announced he was stepping down from the company’s board of directors.  1/18

-Wells Fargo and Citi group announced they had the strongest loan growth numbers since the credit crisis adding to the trend that JP Morgan showed on Friday.  Wells Fargo earnings meet expectations however Citigroup fell short.  1/18

-Ebay’s earnings rose by over triple driven by the sale of its remaining portion of Skype and a 35% increase in revenue.  1/19

-Photography institution Kodak filed for chapter 11 bankruptcy.  1/19

-Goldman Sachs announced a 58% drop in profit due to weaker trading and investment banking revenue, however investors viewed the results positively as there were worries of a loss.  1/19

-Morgan Stanley had an earnings loss for the 4th quarter due to a settlement, but it outperformed expectations. 1/20

-B of A posted a profit for the year and had fourth quarter earnings that met expectations.  1/20

-IBM, Intel, and Microsoft all showed lower revenue growth, however both IBM and Intel reported an increase in earnings.  1/20

-Google missed investors’ expectations on revenue and earnings, however the firm posted an increase of 7% in profit and 25% in revenue. 1/20

-GE’s profits dropped 18% in the 4th quarter as its industrial arm struggles making it more reliant on its financial wing.  1/21

Regulatory 

-The FBI made several arrests of hedge fund traders and analysts for trading on insider information that profited their firms by millions of dollars. 1/19

-The Obama administration shot down the plans for the Keystone XL oil pipeline that would pump oil from western Canada down to refineries in Texas. 1/19

Market 

-After S&P downgraded several countries debt ratings on Friday the credit rating agency downgraded the European bailout fund from triple A to double A+.  1/17

-World markets continue to rally with the strongest start to a year in 25 years.  The S&P 500 surpassed the 1,300 mark for the first time since July and is up 4% for the year, while the Dow is up 3%. 1/19

-Greece and its debt holders have had improving negotiations on restructuring Greece’s outstanding debt.  1/20

-U.S. markets posted their third straight weekly gain for the best start to a year in 15 years.  The Dow rose 2.4% for the week, the S&P 500 gained 2.0%, Japan was up 3.1%, and Europe rose 2.7%.  The Dow reached a six month high.  The 10 year Treasury yield rose back above 2% to 2.028%.  1/21

There is no guarantee that any investment strategy, including those described here, will be successful. Any investment or investment strategy can lose money. Past performance does not guarantee or predict future results. You should not assume that any discussion or information contained in this newsletter serves as the receipt of, or as a substitute for, personalized investment advice from Raffa Wealth Management, LLC. This information was gathered from reliable sources but we cannot guarantee accuracy. Indexes do not reflect the fees associated with actual investments and such fees would reduce the performance illustrated.
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