The bond markets were closed for Veteran’s Day, and there was very little action in the stock markets.
First, the scoreboard:
- Dow: 15,783.1, +21.3, +0.1%
- S&P 500: 1,771.8, +1.2, +0.0%
- NASDAQ: 3,919.7, +0.5, +0.0%
And now the top stories:
- “Bonds are closed so there will be no 10-year yield to guide off,” said UBS’s Art Cashin before the U.S. markets opened. “Also there is no data due on this side of the pond. We may need a cattle prod to move the tape along. Stay nimble and try to stay awake.”
- Cashin’s prediciton proved to be right. There was very little volatility in the stock markets, which just barely closed up.
- In other holiday news, its Singles Day in China. This is an anti-Valentine’s Day when China’s singles go shopping for themselves. According to Alibaba Group, these folks spent $US5.7 billion on themselves today. “By comparison, U.S. consumers spent $US1.5 billion on “Cyber Monday” last year,” reports BI’s Hayley Peterson.
- UBS’s Julian Emanuel was the latest top Wall Street strategist to publish a forecast for 2014. “2014 looks to be another positive year for US equities,” he wrote. “Our year end 2014 S&P 500 Price Target of 1,950 represents a gain of 10.1% from the current price of 1,771. On forecast 2014 earnings of $US116 — 6.9% growth from 2013’s forecast $US108.5 — 1,950 represents a 16.8x trailing multiple. Supported by strong corporate balance sheets, a Fed mindful of keeping conditions on course for 3% GDP growth and the first signs of a pickup in earnings growth – multiple expansion, consistent with historical precedent, is achievable.”
- The U.S. has experienced a major boom in apartment construction since the housing market crash. This was largely due to Americans opting to rent rather than buy. Some economists have warned that the multi-family housing market itself has become a bubble doomed to pop. However, Wells Fargo’s Anika Khan isn’t so bearish. From Khan: “Due to the slower pace of hiring, the number of young adults living at home with an older family member swelled during the early stages of the economic recovery. The large number of young adults living at home with parents suggests there is a good amount of pent-up demand for apartment space. The so-called “echo-boom” generation (18 to 30 years old) hits the prime age for renters (20 to 29 years old). According to the U.S. Census Bureau, there were 44 million people in the prime renter age group in 2012. With this younger age cohort having a higher propensity to rent, especially with lending standards still relatively tight and the large burden of student loan debt, rental demand should remain robust. ”
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