Trade Deficit Falls to Four-Year Low

After three straight down days, the stock market is finally looking up this morning. The S&P 500 is currently up about 11 points or 0.6%. Healthcare stocks are doing particularly well. Buy List stocks like Medtronic ($MDT) and CR Bard ($BCR) are solidly in the black this morning.

The Commerce Department reported that the trade deficit for November fell to $34.3 billion. That’s the smallest gap in more than four years. A key driver of the smaller deficit is lower oil prices. The deficit for November was less than Wall Street’s consensus of $39.9 billion. Most of the trade deficit is with China, and that gap fell to $26.9 billion in November. Exports are now 17% above where they were before the recession.

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This is the quiet period before earnings season begins. The first big company to report will be Alcoa ($AA) which reports after the bell on Thursday. Bed Bath & Beyond ($BBBY) is also due to report this week, but that’s for the period ending in November.

Bloomberg notes that according to analyst estimates, “earnings for companies in the S&P 500 will climb 9.7 percent on average this year, almost twice the rate of 2013, while sales will probably increase 3.8 percent.”

Posted by on January 7th, 2014 at 10:32 am


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