Oil Futures Drop, Gas Rises After Explosion by Jerry A. Dicolo, September 27, 2012, Section 3, Page 4, www.wsj.com Crude-oil prices declined while U.S. gasoline futures surged 3.8% to $3.0874 a gallon in the wake of an explosion at a major refinery in Canada. Damage was minimal but the explosion turned the focus to low U.S. fuel supplies. Jerry Dicolo of the Wall Street Journal says, "U.S. Fuel stockpiles in the Northeast U.S. are their lowest since November 1990, according to the Energy Department." The explosion reminded the markets that supplies are low for this time of year. In order to compensate for the decreased supplies, prices will need to be raised in an attempt to discourage people from purchases large amounts of gasoline.
Data Suggest Trouble Ahead by Josh Mitchel and Ben Casselman, September 28, 2012, Section 1, Page 6, www.wsj.com The U.S. economy remains shaky despite positive gains in the housing market. Orders for durable goods dropped 13% in August from July, the biggest monthly decline in over three years. These goods are used to manufacture long-lasting products such as cars and televisions. Reports from the Commerce Department show a downward revision to the gross domestic product (GPD). The GDP was estimated at 1.7% but was seasonally adjusted to 1.3%. This revision is a reflection of cautious consumer spending and exports coupled with depleted farm stockpiles caused by the Midwest drought. Even though gains have been made in job creation and the housing market, progress is still not strong and quick enough to offset our economic slump. Increasing the consumer price index (CPI) is crucial to this process because when consumers are spending more money, manufacturers will need to produce more of their product.
Stocks Snap Losing Streak by Matt Jarzemsky, September 28, 2012, Section 3, Page 4, www.wsj.com U.S. stocks rose the most they have in two weeks. The Dow Jones Industrial Average great 0.5% in its largest daily increase since September 13, the day Federal Reserve announced a new bond buying program in an attempt to stimulate the economy. The gains are mainly due to global market strength, not because the U.S. economy is making significant gains. The amount of Americans applying for jobless benefits fell to the lowest levels since July, but durable-good orders plummeted 13% in August. There have been slight increases in the labor and housing markets, but not enough of an increase to offset the economy.
Higher Gas Prices Drive Up Spending by Conor Dougherty, September 29, 2012, Section 1, Page 2, www.wsj.com Depleted fuel stock piles in the U.S. has lead to higher gas prices forcing consumers to spend more on a necessary good. Unfortunately their income has not increased which will force consumers to cut back on other goods. As colder months approach, more people will also purchase gasoline to heat their homes. This will increase demand for gasoline which would bring down prices however if the supply is not there then prices will increase further to deter people from purchasing gasoline. The national average retail price of gasoline increased 47 cents a gallon since the start of July which is about 0.1%. Consumer spending accounts for 70% of economic demand, but with an unemployment rate above 8% and a decrease in annual household income many Americans are keeping their spending on a tight leash.
U.S. Steal, Union Make a Deal by John W. Miller, September 29, 2012, Section 2, Page 3, www.wsj.com The United Steelworkers union authorized a new three-year labor contract with U.S. Steel Corporation this Friday which will increase wages and decrease strikes. The contract includes a 4.5% wage hike over the next three years plus bonuses, no-strike provisions, and increased contributions from retirees toward their health-care plans. This deal comes despite difficult economic conditions, however U.S. Steel's CEO John Surma says the agreement is "in the best interests of our company, our employees and all of our stakeholders."
No comments:
Post a Comment