Dow may rise today due to upgrades and M&A activities.
AMD has agreed to buy ATI for US$5.4 billion in cash and stock. Hospital operator HCA agreed to sell itself to investors in what is the largest buyout in history. The three buyers -- Bain Capital, Kohlberg, Kravis Roberts & Co., and Merrill Lynch & Co. -- will pay US$21 billion and take on US$11.7 billion in debt. The US$33 billion deal is worth more than the record 1989 buyout of RJR Nabisco.
cashiertan, why do you say that the double bottom has not occurred when Dow reached the 10,700 level in June and Jul? Or is it part of a larger single bottom?
Double bottoms seldom end downtrends, double bottoms occur often while trending up but not in downtrends.
Increase of 0.1% suggests growth will slow in second half of 2006; Philly Fed also sees slowing activity.
July 20 2006: 2:14 PM EDT
WASHINGTON
(Reuters) -- A key gauge of future U.S. economic growth rose slightly
in June, suggesting the economy will cool further in the second half of
2006, a private research group said Thursday.
The U.S. Index of
Leading Indicators rose 0.1 percent in June to 138.1, just below market
expectations for a 0.2 percent rise, the Conference Board said. June's
increase follows two straight months of declines.
"The
Leading Economic Indicators suggest that the economy could cool even
more in the third and fourth quarters of the year," Ken Goldstein,
labor economist at the Conference board, said in a statement.
"The
Leading Economic Indicators started to soften a year ago and, but for
the interruption caused by the hurricanes and flooding and their
aftermath, it has continued through June," Goldstein said.
The
coincident index, a barometer of current economic activity, increased
0.2 percent in June, building on a 0.1 percent rise in May and a 0.2
percent gain in each of the four prior months, the board said.
The
leading index measures a basket of economic indicators ranging from
unemployment benefit claims to building permits which is supposed to
forecast economic trends up to six months ahead.
Six of the 10
indicators that make up the index increased in June. The positive
contributors were an inverted gauge of new jobless claims, consumer
expectations, real money supply, average weekly factory hours, interest
rate spread, and new orders for nondefense capital goods.
The negative contributors were vendor performance, building permits and stock prices.
New orders for consumers goods and materials held steady.
A
separate survey said Thursday growth in U.S. Mid-Atlantic factory
activity slowed appreciably in July as costs climbed, although the
employment outlook improved.
The Philadelphia Federal Reserve
Bank said its business activity index fell to 6.0 this month from 13.1
in June. That was its lowest since January and well below forecasts of
a dip to 12.0.
Any reading above zero indicates growth in the
region's manufacturing sector, which according to this measure has been
expanding since mid-2003.
The U.S. economy has shown signs of
slowing in the second quarter as a softer housing sector makes
consumers more reluctant to spend money.
This makes the outlook
for businesses all the more important, since many experts hope their
investments can pick up the slack from overstretched and highly
indebted consumers.
"Generally, what this implies is that prices
are rising while business expansion is slowing somewhat," said Michael
Sheldon, chief market strategist at Spencer Clarke, in New York City.
Indeed,
the Philadelphia Fed's index of prices paid by manufacturers edged up
to 50.3 in July from 48.7 in June, while the new orders gauge softened
to 10.1 from 17.7. Nonetheless, the survey's employment barometer
jumped to 12.8 from 6.8.
The outlook for the future appeared
brighter, however, according to survey respondents. The six-month
business conditions index improved to 17.1 from 14.7.
With oil price set to stay high for the next 4 years. It might be good to start accumulating on oil related stocks. Some have order books lasting for the next 3 years.
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