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.
- Unemployment in Conn. rises as job growth stalls
- Mass. unemployment rate climbs to 7 percent
- Conn. average gas price tops a gallon
- Moody’s downgrades Chicago’s debt rating
- Gauge of US economy’s future unchanged in June
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.
Disclaimer: The content on this site is provided for general educational and informational purposes only and should not be taken as investment advice. All site content, including advertisements, shall not be construed as a recommendation to buy or sell any security or financial instrument, or to participate in any particular trading or investment strategy. The ideas expressed on this site are solely the opinions of the author and do not necessarily represent the opinions of sponsors or firms affiliated with the author. Any action taken by you as a result of information, analysis, or advertisement provided on this site is ultimately your responsibility. Consult your investment adviser before making any investment decisions.
