Daily Market Update

Daily Market Update

Daily Market Update World markets rebound after yesterday’s gains and Fed meeting
As the energy sector recouped some losses and markets recovered yesterday, Thursday has started with a more optimistic tone. Oil is edging higher again and yesterday’s statement and press conference from the Fed sounded a generally positive note for the US economy and that sentiment has spread around the world. In Asia most of the major indexes closed higher except Shanghai and Seoul. Janet Yellen’s speech hinting at interest rates staying on hold until mid-2015 and the NYSE rebound has given European markets a good start to the day too. They are also slightly less cautious over Russia with Moscow seemingly making the right noises on supporting the rouble and the wider economy. US stock futures are trending higher along with oil and gold.
 
Today’s data
Jobless Claims at 8.30am ET
PMI Services Flash at 9.45am ET
Philadelphia Fed Survey at 10am ET
As Seen on TV, Nike and Rite Aid are among those reporting today.
 
Consumer prices lower on cheaper gas
The lower price of gasoline was the major factor of a drop in the Consumer Price Index. The decline of 0.3 per cent was the largest since 2008 but the Fed dismissed it and says that it still expects inflation to reach its 2 per cent target.
 
Wealth gap largest since the 80s!
The last time the gap between the richest and the poorest in the US was at levels reported for last year Ronald Reagan was in the White House and Tom Cruise was making teenage hearts flutter in Risky Business. A new report from the Pew Research Center shows that the median income of the top income families is more than 6 times that of the lowest.  The wealth of those richest families is now 70 times that of the poorest. The report says that while high earners have seen income grow faster than inflation, middle and low income families have not increased their income in real terms since the early 90s and the gap is the largest since 1983.
 
Sony facing large losses after ‘The Interview’ is cancelled
Sony Pictures has taken the decision to cancel its controversial comedy movie ‘The Interview’ after threats from hackers, said to be from North Korea. The movie pokes fun at the country’s Kim Jong-Un and was due for release on Christmas Day. The decision to cancel the film will result in losses for the company, although some will likely be recouped from insurance. Costs will run to many millions of dollars with production costs of $44 million, promotion of $33 million and loss of revenue from theater showings, DVD and download releases and TV rights.
 
FedEx delivery falls short of expectations
FedEX reported its latest results yesterday but failed to deliver the earnings or revenue that Wall Street was expecting. With revenue up 5 per cent from a year earlier to $11.9 billion and earnings per share increasing to $2.14 from $1.57 it was positive news, but the markets had expected $11.97 revenue and earnings of $2.22 per share. The company said that it posted a higher operating margin but other costs including aircraft maintenance were higher.
 
New York State says no to fracking
New York State will ban fracking due to a lack of evidence that it is safe. There has been a moratorium on the process since 2008 but a total ban will be implemented by Governor Andrew Cuomo’s administration next year. Vermont is currently the only state with a total ban.