Afternoon Note
After opening the session rather deep in the red, the major equity indices have since reversed to the upside and are testing positive territory again. As expected, Greece's anti-austerity Syriza party has taken 36% of the vote in the country's general election, about 8% more than the governing conservatives. This raises some concern about the stability of the euro, which ended up dropping to as low as 1.1098 against the US dollar in the morning hours– an 11-year low. In addition, the price of oil dropped back below $45 overnight, but has since recovered in this market. As the East Coast braces for tomorrow’s massive blizzard, volumes continue to be rather light. Although economic data will pick up later in the week, there was only one major domestic release today.
The Dallas Federal Reserve released its manufacturing data for the month of January, and it told much of the same story as the Empire State and Philly Fed releases. Factory activity in Texas was flat for the month, with the production index coming in at 0.7. The production index is a key measure of the manufacturing conditions in the state, and this reading essentially noted that output was unchanged from December. Other measurements reflected sluggish activity during the month; the utilization index dropped to a reading of 5.1, the lowest in five months, and the shipments index dropped from 20.8 to 6.0. New orders also moved lower from 2.7 to -7.7 for the first negative reading in new orders since April 2013. Perceptions of business conditions worsened in the month, with both the general business index (-4.4) and the company outlook index (-3.8) dropping below 0 for the first time in 20 readings. The employment index was 9.0 in January, slightly below December’s reading, but close to its average reading over the past two years. In fact, 20% of firms reported net hiring compared with 11% reporting net layoffs. Given the shutdown of many oil rigs and refineries expected in Texas over the coming months, we can expect these numbers to change for the worst next month as well.
Comments |
I am always surprised of the rest of the USA is ever so jealous of Texas and wishes nothing more for them to have a bad economy. Yeah, rigs are going idle, oil/service firing people, but Texas has diversified tremendously, i.e. tech in Austin, medical in Houston and such....NO, Texas is not going the way of other states. Karin on 1/26/2015 1:44:40 PM |
Recommend the EU drop the EURO and adopt the Dollar and as its' currency then the Fed expand to include the European Central Bank(s) Joe Brown on 1/26/2015 1:56:10 PM |
The weekly ECRI recession watch charts on dshort.com would indicate that a new recession is near. Rodman Johnson on 1/26/2015 4:49:10 PM |
Dear Sir; I'm distressed that Russia needs $115.00 dollar a barrel to meet their budget. How dare they have a budget, when we can't? The Saudis use oil as a weapon not to lower USA business but to bankrupt Syria and Russia. Energy at lower price, lowers the price of everything the consumer buy. The BS about roads needing more than the tax to renew themselves would not be a subject if all the revenue was used for roads etc. People use more gas as it becomes cheaper but the tax (.48 cents ) is fixed , therefor more revenue. The crap about the minimum wage , which would turn 40 million non tax payers into tax payers would raise about 60 million an hour to give to W. yet no one points this out Disgusted J Vallely james vallely on 1/27/2015 10:51:54 AM |
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