Housing prices in the U.S. have climbed to their highest rates in over six years, a strong indicator that the real estate market will have a large part in U.S. economic growth in 2013.
According to recent data, the S&P/Case-Shiller index rose 5.5% since the last quarter of 2011, the most significant growth since the summer of 2006. The progress is expected to continue as mortgage rates hover around a record low while property values rise. Experts believe this will boost consumer spending and sentiment, despite this month’s payroll tax increase.
Millan Mulraine, an economist at TD Securities, explains: “Rising home prices are providing an important cushion.” Lower confidence and reduced paychecks “will slow consumer spending this quarter, but the effect will abate in coming months,” she added. “The souring in moods is a reflection of the brinkmanship in Washington and the higher payroll tax.”
Michael McKee, economics editor at Bloomberg, discusses the recent developments in home prices here.
Apple Inc.’s third quarter revenue fell short of Wall Street’s projections as iPhone sales begin to falter. Investors are beginning to hesitate as Apple loses stature in the mobile industry.
Company shares fell 10% to $463 from $514, bringing the market value down by $50 billion.
This past week, Apple said it shipped a 47.8 million iPhones, a company record, during the December quarter. Though the figure was 29% higher than last year, analysts had predicted 50 million shipments for that period.
Shaw Wu analyst Sterne Agee said: “It’s going to call into question Apple’s dominance in the space. It’s still one of the strong players, the others being Samsung and Google. It’s still a two-race, but Android continues to grow rapidly.
“If you step back a bit, it’s clear they shipped a lot of phones. But the problem is the high expectations that investors have. Apple’s conservative guidance highlights the concerns over production cuts coming out of Asia recently.”
This is certainly the case for Apple, which predicted revenue of $41- $43 billion for the current quarter, while analysts marked their expectations at $45 billion.
Small businesses and startups have earned a significant role in the U.S. economy, creating tens of thousands of jobs across the nation and assisting in community growth.
There are currently several leading trends in the sector. According to Fox Business, these include:
SBA Boosts Small Business Lending
The Small Business Administration had its second-highest lending volume level in 2012, reaching $30 billion in loans.
Incorporation of Technology in Small Business Lending
Online platforms have been launched to enable small business owners to compare and apply for loans over the internet, instead of visiting numerous banks to compare deals.
Crowdsourcing Campaigns
“Crowdsourcing”, the use of social media to encourage friends, acquaintances and other lenders to donate modest amounts of money to small business owners, became popular in 2012. Legislations were even passed in order to ease this process and boost capital.
Alternative Lenders
Big banks, small banks and credit unions all have low approval rates. This has opened to doors to a whole new approach to lending, including cash advance companies, accounts, receivable financers, factors and micro lenders.
Big-name retailers are upping their appeal to last minute holiday shoppers by offering extended hours, sometimes even staying open for more than 24 hours straight.
Macy’s was the first to announce such a policy, broadcasting last week that its stores will be open in the 48 hours leading up to Christmas Eve. The department locations will open on Friday, Dec. 21st through Sunday, December 23rd.
Other retailers are following in Macy’s footsteps, hoping to draw last-minute gift buyers and other shoppers.
Toys “R” Us announced that its stores would remain open for 88 hours straight in preparation for Christmas Eve. It also kept its Times Square location open for 24 hours for the past few weeks, and will continue to do so until Christmas. Target is also extended its hours.
Macy’s chief stores officer explained:
“We hope to make it easy for our customers across the country to finish their shopping at any time of day or night, and with the benefit of the great deals and value they count on from hour One Day Sales when must see here.”
According to International Personal Finance, or IPF, pretax profit in the first quarter fell significantly as a result of weak exchange rates and high prices.
IPF revealed that their profits, before tax, dropped to $9.7 million, while first quarter revenue fell as well.
“We have made an encouraging start to the year and are on track to perform well in 2012,” said Gerard Ryan, CEO. “The result for the quarter includes the impact of higher rebate costs and weaker foreign exchange rates, which are in line with previous guidance.”
Meanwhile, the company shares rose 4% to $3.92 in London, bringing the market value to over $100 million.
IPF is a leading home credit provider, working across the globe for over 130 years. The firm prides itself on its personal relationships, fast and flexible approach, and accessible loans.
According to their website, “Loans are arranged and delivered by our agents in the convenience of our customer’s home, at a time that suits them.”
They also consider themselves to be all-inclusive, stating: “Our customers are often not well served by banks. They may have no credit history and prefer to use cash. Our loans appeal to those who want smaller loans and manageable repayments.”
Everyone knows Facebook, as a company, is different. Its unique abilities and exponential growth have changed the way we communicate, socialize, and some say, even think. It is not surprising that the driving force behind this startlingly innovative enterprise is a man who marches to a different drummer, Mark Zuckerberg.
Person of the Century?
The most common adjective used to describe this feisty entrepreneur is “cocky;” coming in a close second is of course is “billionaire.” But as the revolutionary visionary who, at age 26 Time Magazine named “Person of the Year,” Zuckerberg can get away with wearing hoodies to business conventions, and more.
Waiting with Baited Breath
Therefore, as he approaches the moment many in the business and investment world have been waiting for, the IPO launch of Facebook, Zuckerberg’s actions are being scrutinized for some uncommon step making the usually staid initial public offering event into an exciting adventure.
Analysts believe the company could file to sell their stock on the open market as early as this Wednesday. The buzz surrounding the event is deafening; it is being compared to the unprecedented excitement stirred up when Google went public in 2004, and maybe even as exciting as the wild and crazy 1990s.
Users Investing, too?
One thing stock watchers are looking out for is a kind of surprise move by a large percentage of Facebook’s 800 million users to get in on the action since, after all, Facebook is, if it is anything at all, about personal connections.
"Pandemonium is what I expect in terms of demand for this stock," says Scott Sweet, senior managing partner at IPO Boutique, an advisory firm. "I don't think Wall Street would want to anger Facebook users."
Analysts believe that Facebook’s goal is to raise up to $10 billion. That number will put the value of the company at $75 billion to $100 billon, making it one of the largest IPOs ever. Three to four months usually pass before the stock starts trading, after the initial filing.
The next three months is sure to be memorable, for Facebook users, investors, and bystanders on the sidelines.
Tuesday’s market performed positively as fears of new US Federal Reserve capital proposals turned out to be misplaced.
Three Diverse Sectors Climbed
Investors fueled the rally with support for the banking sector, home-builders and networking companies, although analysts admit that the market’s upward climb was amplified by relatively low volume.
The stock market realized a 3% rise as the banking sector, which was already gaining points due to the US Federal Reserve’s new capital proposals ended up being not as bad as had been feared, inspired further support.
Banking
The happy stats for the banking sector are as follows: The KBW Banks index jumped 4.1%; JP Morgan Chase & Co jumped 5% to $32.22; and Wells Fargo & Co rallied 4.6% ending at $26.47 per share.
Matt McCormick, one of Cincinnati-based Bahl & Gaynor’s money managers commented that,
“Investors have been looking for clarity on the regulatory outlook, and I don’t think these rules are so strict that we should expect anything like significant dividend cuts.”
Home Builders
Gains were also realized based on positive figures for the housing figures: The Dow Jones home construction index climbed 6%, with the nation’s second largest home builder, Pultegroup, up 10%; and MDC Holding rising by 7.3%.
Networking
The diversified sectors which supported the impressive gain were completed by networking companies.
Ever since 1969 the S&P 500 has gone up by an average of 1.6% during the last five days and the first two days of the year, according to data from the Stock Trader’s Almanac. This fact is known as the Santa Claus rally.
The general outlook for stocks was good as about 86% of stocks traded on the NYSE closed higher, while about 80% of NASDAQ stocks ended the day in positive territory.
NEW YORK — Plunge! Rebound! Crash! Rally! Plunge again! That’s been the depressing story line of the stock market the past five trading days, a gut-wrenching, confidence-testing, wealth-destroying bout of volatility that has put investors on edge.
Wall Street has gone haywire again, just as it did in 2008, when stock prices swung sharply up and down like an elevator in a skyscraper during the morning rush. Just as it did on May 6, 2010, when a “flash crash” inspired a short-lived Dow dive of almost 1,000 points. And just as it did on Black Monday in October 1987, when the Dow suffered a record one-day percentage drop of 22.6%.
By Nathaniel Popper, Los Angeles Times
Reporting from New York — So much for those stock market gains that were fattening up portfolios not so long ago.
Disappointing economic news drove stocks down again Friday, sending the Dow Jones industrial average below 12,000 for the first time since March 18.
Most of the profits U.S. stock investors have seen since the beginning of the year have been wiped out after six straight weeks of falling share prices.
Analysts blamed the latest tumble on China’s announcement that its trade surplus in May was smaller than expected, suggesting that global demand for Chinese goods has slowed. Investors were also disappointed by Britain’s announcement that its manufacturing sector was growing more slowly than expected. Continue reading Most 2011 stock market gains are gone
Times Square and outside the White House weren’t the only streets where people were celebrating the death of Osama Bin Laden yesterday.
Wall Street reacted to the killing of the world’s most wanted terrorist with a rise in stocks when Monday’s markets opened — and a temporary dip in oil prices, which have been rising steadily due to the unrest in Libya and the Middle East.
