by Lee Adler, Wall Street Examiner
Industrial Production fell by 0.5 percent in April on a seasonally adjusted basis after having increased 0.3 percent in March and 0.9 percent in February, according to the Fed. The consensus estimate was for a decrease of 0.2%. Economists had been missing to the optimistic side on most forecasts for the past several months. This month they course corrected and now their estimates are too low.
The media only pays attention to this silliness because it has nothing better to do. I’m more interested in how the the trend of actual, not seasonally manipulated, economic data lines up with the performance of the stock market, since there is some historical correlation.
by Jeff Miller, A Dash of Insight
Ready or not, we should expect a week dominated by an even greater focus on Fed policy. There are four reasons:
- The economic data calendar is very light;
- Earnings season has ended;
- Many will be heading for the exits early, anticipating a holiday weekend; and finally
- Bernanke testifies on the economy before the Congressional Joint Economic Committee. There will also be other Fed speeches and the minutes of the last FOMC meeting.
What should we expect?
Written by Trefis
Below is a summary of the activity at Trefis during the past week that Trefis thought Econintersect readers would find interesting.
Trefis is a financial community structured around trends, forecasts and insights related to some of the most popular stocks in the US. It provides the unique feature of allowing the user to model future valuation based upon projected changes in components of each business. It also provides communication capabilities among members, including consensus of member analysis compared to Trefis staff analysis and blogging opportunities for members.
Click on graphic for larger image and go to Trefis interactive page.
Click "Read more..." to see our clickable table of contents and most covered companies of the week.
From Daily Reckoning
by Dan Amoss, Daily Reckoning
Will investors perpetually bid up an earnings stream that has peaked and may be on the verge of shrinking? We’re about to find out…
With first-quarter earnings season under way, expectations for earnings have rarely been higher. But there are many signs that corporate profits have peaked, including a surge in negative guidance from company management.
Disappointment and lower stock prices are likely; it makes no sense for investors to pay ever higher prices for a shrinking earnings stream.
by Felix Richter, Statista.com
Back in February 2012, when Facebook announced its plans to go public, the tech world immediately went crazy. The hype was enormous over what should become one of the biggest IPOs of all time. On May 18, Facebook started trading at $38, giving the company an implied valuation of $104 billion. Unfortunately, what was supposed to be a sure shot investment, turned out to be a dud.