Strong January Set to Close on a Positive Note
It’s the last day of the first month of the year, and it's shaping up to be a good one. U.S. futures are pointing firmly upward, after muted losses Monday.
January is also shaping up to be a good month; in fact, it may be the strongest January in 15 years for the Dow Industrials and the S&P 500. Those averages are up 3.5% and 4.4%, respectively this month, and the Nasdaq is up 7.9% in January – its best start to the year since 2001.
Taking a look overseas this morning, unemployment in the 17-nation eurozone ended 2011 at 10.4%, a new high for the region. About 16.5 million people are without work, though unemployment figures in Europe’s biggest economy, Germany, declined this month to the lowest level since the reunification of the nation back in 1990.
The European Union Summit in Brussels is over and 25 of the 27 nations agreed to a treaty that enforces more fiscal discipline and limits overspending by punishing perpetrators. The individual nations will bring the treaty home to ratify. The holdouts are the UK and the Czech Republic, and Greece is still the wildcard.
Kenny Polcari, managing director at ICAP, adds a little humor: “Global markets will continue to be held hostage by Hercules, Aphrodite, Apollo, Hermes, Poseidon … and Lucas Papademos as he discloses that he cannot ‘exclude the possibility that his country will need more help – on top of the new $170 billion bailout and a deal with private investors to slash its debt.’”
While Greece is still hoping to nail down negotiations with its private creditors to get a deal done by week’s end, international debt inspectors have delayed today’s meeting on lowering Greece’s high employment costs – a measure necessary to get the second tranche of bailout money Polcari cites above.
European stock markets are mostly higher half-way into their trading day. Borrowing costs have also moved lower in key euro-zone nations Italy and Spain.
Back stateside, investors are eyeing Florida, where polls have officially opened in the fourth and so far most-hotly contested GOP primary. Republican contenders and super PACs that back them have spent a record $20 million campaigning in Florida, which has a 9.9% unemployment rate, the seventh highest foreclosure rate in the nation, 50 delegates up for grabs, and 10 media markets that are showing mostly negative ads between Newt Gingrich and Mitt Romney.