Growth Stalls, Unemployment Rises, Gas At $4.00 Per Gallon And Chicago’s Debt Rating Lowered

One of the things I like to do to try and gauge the markets temperature is to go to Yahoo! Finance and scan the AP news headlines. The following are some of the headlines that caught my attention this morning.

Source: Link

These stories follow Intel’s disappointing second quarter earnings report wherein the company showed a 29 percent drop in net income and a 5.1 percent drop in revenue. After the earnings release, shares of Intel (INTC) dropped 4.0 percent in after-hours trade and the shares closed down 3.77 percent from yesterday’s close at $24.15 to $23.24. This is a concern because it means that other areas of the tech sector (a recent bright spot for the economy) are slowing as well (e.g. PC, tablet and smartphone sales).

With regard to fuel costs, higher oil and gasoline prices always seem to presage recessions. Even if that is not the case this time, higher gasoline prices will not serve the economy well. With peak vacation season now upon us, higher fuels costs will certainly dampen many vacationers’ plans, and food prices will be certain to rise given the higher transportation costs.

All-in-all, these headlines could spell trouble for the economy.

Disclosure: I own shares of INTC, indirectly, through the Vanguard Total Stock Market (VTI) ETF.

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