Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


While you were sleeping: Progress on US budget deal

While you were sleeping: Progress on US budget deal

Jan 2 (BusinessDesk) – The New Year could begin on a positive note if US lawmakers in the House of Representatives approve – as did their counterparts in the Senate – a deal that averts the worst impact of falling over the fiscal cliff.

In an unusual New Year's Day session at around 2am Eastern standard time, the Senate voted in favour of a bipartisan deal that holds taxes at current rates for almost all but the wealthiest of Americans. The debate over spending cuts has been delayed for two months.

House Republicans are set to meet on Tuesday afternoon in Washington to decide on their next move. US markets are closed Tuesday for the New Year's holiday.

If approved in the House too, the US$600 billion in tax increases and spending cuts that had been forecast to tip the world's largest economy into recession in the first half of this year will be avoided.

Signs of a potential resolution helped boost Wall Street on Monday, lifting the three benchmark stock indexes by at least 1.28 percent.

Still, the proof is in the pudding, investors say.

"My personal scepticism, I don't trust anything out of Washington until it is signed, sealed and delivered, and it is not signed, sealed and delivered," Ron Florance, managing director of investment strategy for Wells Fargo Private Bank, based in Scottsdale, Arizona, told Reuters.

Central bank stimulus certainly helped equities last year. In 2012, the Standard & Poor's 500 climbed 13.4 percent, its best annual performance since 2009. Still, the index increased only 0.7 percent last month, its worst December since 2007, according to Bloomberg.

The Dow Jones Industrial Average gained 7.3 last year, while the Nasdaq Composite Index advanced 15.9 percent. Europe's Stoxx 600 Index rose 14 percent for the year.

What lies ahead? Well Laszlo Birinyi is as bullish as ever. The benchmark gauge for American equity is within 10 percent of its record after gaining 107 percent since March 2009, data compiled by Bloomberg show.

Birinyi told Bloomberg that he expects the market to rise as more individuals return to it in the year ahead.

Pacific Investment Management's Bill Gross, manager of the world’s biggest bond fund, expects Treasury five-year notes to yield 0.7 percent at the end of 2013, according to Bloomberg, citing a Twitter post by Gross on Monday. The note yielded 0.72 percent yesterday. He also said he expects the US dollar to decline and oil to climb above US$100 in 2013.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Power Outages, Roads Close: Easter Storm Moving Down Country

The NZ Transport Agency says storm conditions at the start of the Easter break are making driving hazardous in Auckland and Northland and it advises people extreme care is needed on the regions’ state highways and roads... More>>

ALSO:

Houses (& Tobacco) Lead Inflation: CPI Up 0.3% In March Quarter

The consumers price index (CPI) rose 0.3 percent in the March 2014 quarter, Statistics New Zealand said today. Higher tobacco and housing prices were partly countered by seasonally cheaper international air fares, vegetables, and package holidays. More>>

ALSO:

Notoriously Reliable Predictions: Budget To Show Rise In Full-Time Income To 2018: English

This year’s Budget will forecast wage increases through to 2018 amounting to a $10,500 a year increase in average full time earnings over six years to $62,200 a year, says Finance Minister Bill English in a speech urging voters not to “put all of this at risk” by changing the government. More>>

ALSO:

Prices Up, Volume Down: March NZ House Sales Drop 10% As Loan Curbs Bite

New Zealand house sales dropped 10 percent in March from a year earlier as the Reserve Bank’s restrictions on low-equity mortgages continue to weigh on sales of cheaper property. More>>

ALSO:

Scoop Business: Chorus To Appeal Copper Pricing Judgment

Chorus will appeal a High Court ruling upholding the Commerce Commission’s determination setting the regulated prices on the telecommunications network operator’s copper lines. More>>

ALSO:

Earlier:

Cars: Precautionary Recalls Announced For Toyota Vehicles

Toyota advises that a number of its New Zealand vehicles are affected by a series of precautionary global recalls. Toyota New Zealand General Manager Customer Services Spencer Morris stressed that the recalls are precautionary. More>>

ALSO:

'Gardening Club': Air Freight Cartel Nets Almost $12 Million In Penalties

The High Court in Auckland has today ordered Swiss company Kuehne + Nagel International AG to pay a penalty of $3.1 million plus costs for breaches of the Commerce Act. Kuehne + Nagel’s penalty brings the total penalties ordered in this case to $11.95 million ... More>>

ALSO:

Crown Accounts: Revenue Below Projections

Core Crown tax revenue has increased by $1.9 billion (or 5.0%) compared to the same time last year. However this was $1.1 billion less than expected and is reflected across most tax types, continuing the pattern of recent months. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news