Reporting from the New York Stock Exchange RK Walker reviews the previous week’s financial news. The previous week the S&P reached a record high, but the activity that followed could not sustain that momentum. There is a lackluster growth, but earnings continued to rise due to cost-cutting and by-backs.
Emerging market currencies fell against the dollar creating increased worry among investors, causing a drop in interest rates. In addition the “Flash purchasing manager’s index” for China fell to 49.6 in January, down from 50.5 in December. When the index falls below 50 it is an indication that the manufacturing sector is shrinking. This was China’s first reading below 50 in half a year.
The number of unemployed for the week ending on January 18 amounted to 326,000, just 1,000 more from the previous week. Increasing home sales went up by 1% in December to 4.87 million units.
In the realm of stocks, IBM took a dive after they released the report of their fourth quarter earnings. They reported a drop in revenue of 5% from $29.3 billion to $27.7 billion.