The markets and exchange traded funds (ETFs) are surging higher this morning on a number of encouraging numbers released about our economy, including manufacturing, consumer spending and construction spending.
But first, the Dow Jones Industrial Average is getting a bit of a makeover today. Bumped from the index are General Motors (GM) and Citigroup (C); added in are Cisco Systems (CSCO) and Travelers (TRV), an insurance company.
GM’s expected bankruptcy took place today amid much hand-wringing, says Aaron Task for the Tech Ticker. There are nany concerns: about the level of debt vs. assets: $173 billion vs. $82.3 billion; job losses as dealers close and plants idle; and the fact that the government is now a majority owner.
A judge has cleared the way for Chrysler to leave bankruptcy by giving the go-ahead to a sale of most of its assets to Fiat in Italy, reports Michael J. de la Merced for The New York Times. Chrysler may now emerge from bankruptcy as early as this week.
President Barack Obama said the bankruptcy would take a painful toll, but ultimately lead to a strong company that can compete in the 21st century, The New York Times reports.
In better news:
- U.S. construction spending rose 0.8% in April, roundly beating out forecasts that called for a decline. The gain is the largest since August, and it’s the second consecutive month that builders boosted construction spending, reports Jeannine Aversa for the Associated Press.
- The manufacturing index also showed a slowdown in May, but that the sector is still faring better than analysts had expected, reports Tali Arbel for the Associated Press. The index is at its highest level since September. One analyst says that once the sector really begins to grow again, it could be of the “slow growth” variety.
- Consumer spending dipped slightly in April, by 0.1%. This, too was less than expected. Americans continue to be motivated to save because of rising unemployment, Jeannine Aversa for the Associated Press notes. On the plus side, incomes rose 0.5% following two consecutive months of declines.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.