Business

Market Recap: Stocks Trapped Between Declining Home Prices and ‘Improving Consumer Sentiment’

Posted on December 27, 2011 at 4:20pm by Becket Adams
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Markets closed mixed on Wall Street today:

Dow -0.02 percent
S&P +0.01 percent
Nasdaq +0.25 percent
Oil +1.67 percent
Gold -0.69 percent

On the commodities front:

Oil (NYSE:USO) climbed to $101.34 a barrel
Gold (NYSE:GLD) fell to $1,594.90 an ounce
Silver (NYSE:SLV) fell 1.54 percent to settle at $28.64

Today’s markets were mixed because:

1) Home Prices: Though equities closed the day mostly flat, they started the day sharply lower on news that U.S. home prices fell more than forecast in the year ended in October, indicating that the housing market continues to be weighed down by foreclosures. The S&P/Case-Shiller index of property values in 20 major U.S. cities fell 3.4 percent from October 2010 to October 2011, after decreasing 3.5 percent in the 12-months ended in September, the group said today.

2) Consumer Confidence: Stocks quickly reversed their decline when the Conference Board announced its index of consumer sentiment rose to the highest level in eight months in December, with a reading well above the average in June 2009. Improving sentiment might help sustain household purchases, which account for roughly 70 percent of the U.S. economy.

The Conference Board’s measure of present conditions increased this month as well, as did its measure of expectations for the next six months, while the share of consumers saying they believed “jobs were plentiful” rose in December to its highest since January 2009 and those saying “employment was hard to get” decreased to the lowest since January 2009.

More respondents also said they “expected more jobs to become available in the next six months,” and that they expect their incomes will likely increase as well.

Why they should expect that is anyone’s guess.

3) Sears: Sears Holdings on Tuesday reported a sharp drop in holiday sales compared to a year ago, and said the results will force them to close 100 to 120 Sears and Kmart stores. As a result, SHLD shares plunged 26 percent, dragging down other retail stocks on fear that Sears might not be alone when it comes to underwhelming holiday sales figures. J.C. Penney, Kohl’s, Saks, The Bon-Ton Stores, and Walmart all closed the day lower.

[Editor’s note: the above is a cross post that originally appeared on Wall St. Cheat Sheet.]

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Comments (15)

packsack54
Posted on December 27, 2011 at 11:03pm
A roll of tolet paper will be worth more than our currency. Just wait till the people want their money. Yes when those bond come due even the short term notes be paying 10 to 20%, that what those ccc do to poor or bad risk just like Uncle Sam is da-m poor. Real credit score is below 370.
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Outlaw_Josey_Wales
Posted on December 27, 2011 at 9:30pm
There is a bubble a very low interest rate treasuries bonds, some day they will have to be rolled over into a higher rate bond, when this happens big trouble for the economy.

Columns:
1 fiscal year
2 debt in trillion
3 average interest on debt
4 debt payment in billions
1_______2________3_______4
2011____$14.7____2.8% ____$454*
2010____$13.5____3.0%____$413
2009____$11.9____3.2% ____$383
2008____$10.1____3.8%____$451
2007____$9.0_____ 4.8%____$429
2006____$8.5_____5.0%____$405*
2005____$7.9 _____5.1%____$352
2006____$7.3_____4.5%____$321
2003____$6.7_____5.4%____$318
2002____$6.2_____ 5.1%____$332
2001____$5.8_____ 5.7%____$359

*Notice since 2006, the debt has almost doubled, the interest almost cut in half, the interest payment only increased by $49 billion. The interest payment on a $15.1 trillion debt at 5% interest is $755 billion, 6% interest $906 billion. 7.25% interest $1.094 trillion. “7.25% is the 30 year average interest on the debt”. This bubble keeps getting bigger every year by over $1.2 trillion. Just a matter of time before the U.S. defaults on it’s debt.

I hope the columns turned out better this time.
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diablamonkey
Posted on December 27, 2011 at 6:50pm
what the liars don’t get is that we are out here living this lousy economy- we know the jobs aren’t there, we know the price of food is sky high and we know that our confidence is in the sh(*&^&^. They can lie all they want-WE ARE LIVING THE TRUTH AND THE TRUTH SHALL SET US FREE-
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broker0101
Posted on December 27, 2011 at 6:47pm
While GOLD resumes its inevitable trek back toward normal price levels (probably in the $1000-$1200 range by the end of 2012.), which will absolutely FLEECE all the Suckers who bought what Glenn Beck is selling. Literally.
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- carbonyes
  Posted on December 27, 2011 at 7:19pm
  @BROKER0101, stand by for a RAM, because gold is doing a temporary retrace. you will profoundly see gold at a new high in 2012, very likely above $2000.00, maybe substantially so. Doesn‘t take a rocket scientist in finance to realize that you can’t continue to print and spend money at the levels we are doing to understand that the dollar will eventually tank. It is only a matter of time – in other words, inevitable.
  Report Post »
- carbonyes
  Posted on December 27, 2011 at 7:23pm
  Don’t know what you are selling BROKER0101, but I‘d say if you’re hyping the stock market, you are the one whose clients are going to get fleeced.
  Report Post »
- Outlaw_Josey_Wales
  Posted on December 27, 2011 at 8:53pm
  Look at what I’m trying to tell all the american people, the U.S. economy is doom, we have a bubble of very low interest rate treasury bonds we will have to roll over to a higher rate.
  
  Interest payments on the national debt
  Columns:
  1 fiscal year
  2 debt in trillion
  3 average interest on debt
  4 debt payment in billions
  1 2 3 4
  2011 $14.7 2.8% $454*
  2010 $13.5 3.0% $413
  2009 $11.9 3.2% $383
  2008 $10.1 3.8% $451
  2007 $9.0 4.8% $429
  2006 $8.5 5.0% $405*
  2005 $7.9 5.1% $352
  2004 $7.3 4.5% $321
  2003 $6.7 5.4% $318
  2002 $6.2 5.1% $332
  2001 $5.8 5.7% $359
  
  *Notice since 2006, the debt has almost doubled, the interest almost cut in half, the interest payment only increased by $49 billion. The interest payment on a $15.1 trillion debt at 5% interest is $755 billion, 6% interest $906 billion. 7.25% interest $1.094 trillion. “7.25% is the 30 year average interest on the debt”. It’s just a matter of time before the United States defaults on its debt, I see no way out of this mess. Buy gold silver guns and can goods.
  Report Post »
- seeker9
  Posted on December 27, 2011 at 11:32pm
  There IS a gold short ETF; you make money if gold price declines. Neutral to bearish on gold for 3 months.
  Report Post »
possom
Posted on December 27, 2011 at 6:11pm
I know people who went all out this christmas because they believe it may be the last one for a while. I’ll believe them before these “everything is rosy articles”.
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IMPEACHBHO
Posted on December 27, 2011 at 5:54pm
Why indeed would they expect that. Well, it has taken me a few years to accept the fact the BHO IS USING conversational hypnosis. (look it up online). It is real, and he is using it. It explains the uncanny behavior of so many that cannot see BHO for who he really is.
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- mils
  Posted on December 27, 2011 at 6:01pm
  Who ever these clowns are surveying are liberal fools, or just lying..
  ..I don’t believe consumer confidence is up one iota..not one
  …no body asked me!! had to come from the projects in the NE
  Report Post »
- Baddoggy
  Posted on December 27, 2011 at 6:04pm
  f you have your money in the stock market, you are a FOOL! Gold, silver, food, water and LEAD….There is your future.
  Report Post »
netmail
Posted on December 27, 2011 at 5:45pm
Consumer confidence up?? Did credit card companies raise limits carte blanche or what??
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1776freedomofspeech
Posted on December 27, 2011 at 5:45pm
We need business friendly gov‘t in the USA and less gov’t redtape and bogus handouts, less welfare, etc.
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- Baddoggy
  Posted on December 27, 2011 at 6:05pm
  Hold your breath until that comes and you will be dead….LOL
  Report Post »

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