1) In retail: Wal-Mart (3 year high), Home Depot (highest since 2006), Sherwin Williams (historic high), and CVS (2.5 year high).
2) in pharma: Merck , Pfizer (3.5 year high), Abbott ;
3) in industrials: Union Pacific (historic high), Lockheed Martin ;
4) in oils, Chevron ;
5) we hit intraday highs on several consumers: Hershey , Yum , and Kraft .
U.S. economic data: where is it headed? December ISM manufacturing at best levels since June. Q4 GDP will likely come in up 3 percent. So why is everyone so pessimistic about the U.S. economy in 2012?
You hear it everywhere: the party isn't going to last. Brace yourself. The argument is pretty simple: consumer spending has been strong because consumers have been out charging it up again (relatively). There's been less saving recently, more spending, and spending is outpacing income. That can't last, strategists have argued.
And unlike the mid-1990s, consumers will not be able to tap real estate to help pay off the credit card debt.
What's wrong with this picture? Maybe nothing. But Joe LaVorgna at Deutsche Bank told me that the figures on income and employment are likely to be revised upward in short order, as will savings.
The next revision for income (going back 5 years) is in July. Employment revisions (also going back 5 years) are in February.
Why will income be revised upward? LaVorgna told me that there's a large discrepancy between wage and salary numbers (the biggest piece of personal income) and tax receipts. Growth through November for wages and salaries is 3.4 percent, while withholding receipts have been running around 4.2-4.3 percent. LaVorgna believes wage and salary numbers will be revised upward to get closer in line with withholding receipts.
Bottom line, according to LaVorgna: people are spending more because they really do have more income.
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