The Dow gained 25 points, the Nasdaq rose by 14, and the S&P 500 advanced 2. Thirteen of the Dow’s 30 components gained ground, led by United Technologies (UTX), which rose 2%. The price of Facebook shares (FB) fell an additional 4% in the second session after its post IPO lockup period ended. Apple’s shares gained 1% and briefly set a record high in advance of its much-anticipated introduction of the iPhone 5. Volume was light, and advancing issues outnumbered decliners by about five to three. The prices of Treasuries strengthened, while the price of gold futures gained .01% to $1,619.40 an ounce. The price of crude oil on the New York Mercantile Exchange gained 0.42% to $96.01 a barrel.
For the week, the Dow gained 0.5%, its sixth consecutive weekly gain. The Nasdaq rose by 1.8%, and the S&P 500 advanced by 0.8%.
In Earnings News:
- Foot Locker announced earnings increased from 24 cents a share a year ago to 39 cents a share in the latest quarter. Revenue rose by almost 8% and, in Europe, which accounts for 20% of the retailer’s business, the company reported profits in spite of the downturn in European economies. The price of Foot Locker shares (FL) gained 1% in today’s session.
In Other Business News:
- Consumer morale is improving so far in August. The University of Michigan announced that its consumer sentiment index increased from 72.3 to 73.6, its highest level since May.
- The Conference Board reported that its index of leading economic indicators edged higher in July. The index aims to forecast the strength of economic activity three to six months in advance, and July’s improvement follows a decline in June, suggesting perhaps that the economy might pick up momentum in the second half of the year.
- Interest rates on fixed-rate mortgages rose this week for the third week in a row, according to Freddie Mac, the mortgage giant. Rates on 30-year, fixed-rate mortgages averaged 3.62% this week. “The latest economic indicators point toward low inflation but gradually stronger economic activity, which placed further upward pressure on long-term Treasury yields and, in turn, fixed mortgage rates,” said a Freddie Mac spokesman.
Some economists expressed surprise today at the improvement in the leading indicators and the consumer sentiment indexes. “What? Things are getting better? How can that be? I thought we all agreed that things aren’t getting better.” My question is: Why do pundits and reporters always think the course of future events is something they vote on, as if the future is a popularity contest? Please, events don’t care what we think; they happen at their own time and pace and surprises are always a part of the future.
I just came back from a vacation during which I made a point of staying out of touch. Imagine my surprise when I started reading the news again and learned the following:
- While global emissions of carbon dioxide continue to rise, they have fallen in the U.S. to their lowest levels since 1992, according to a report from the Energy Department. Apparently the boom in natural gas is prompting power companies to switch from coal to cleaner burning gas. HUH? The U.S., which has been the world’s whipping boy for profligate greenhouse gas emissions, is one of the few industrialized nations making progress in lowering them. Who knew? Surprise!
- Speaking of hydrocarbons, while I was away, Goodyear Tire announced it is planning to replace petroleum with soybean oil as a feedstock for tires. Yes, Goodyear is hoping to make tires from beans. (Presumably, the company will add a little Beano to each tire. I mean, imagine I’m driving down Main Street in my Cadillac Escalade and, well…surprise!)
- Are you wedded to your mobile devices? Eva Restaurant in Los Angeles will knock 5% of your dinner bill if you check your mobile phone at the door. Cool, less gab, less tab. (If Wyatt Earp had thought of positive reinforcement like that, there might have been no gunfight at OK Corral.)
- The latest thing in vending technology can be found in Japan where machines have recently appeared vending fresh eggs, live crabs, and cars. Yes, there is a vending machine selling the tiny Smart car. Granted the car is really small, but that doesn’t guarantee it won’t get stuck in the slot. Surprise!
- Two weeks ago, the Brewers Association reported that the number of breweries in the U.S. grew by 350 last year to 2,126, the most since 1887. Of course, most of these are small, local, boutique breweries selling their wares primarily in an associated “brew pub.” The latest brewery count doesn’t include noncommercial breweries such as, um, er, the White House. Yes, in case you missed it, the White House is brewing its own beers, including a flavor called “White House Honey Ale” made using honey from Michelle Obama’s garden beehive. Cool. I could never imagine why anyone would want to run for the White House, given the aggravation. Maybe I’ll rethink my position now that I know the White House is actually an artisanal brewery. (If elected, I’ll make my beer from soy beans. Imagine at the state dinners…surprise!)