Markets wavered on Monday after industrial production dropped for the first time since January. The Federal Reserve announced that industrial production had slipped 0.1% in August. The industrial production reading measures the output of U.S. manufactures and utilities. August’s data missed economists’ expectations of a 0.3% gain. They also downwardly revised July’s data from the originally reported 0.4% gain to a 0.2% gain. There was a 0.4% drop in the manufacturing portion of the report. The manufacturing sector is the most highly anticipated part of the report and includes auto production, which fell 7.6% last month. Aaron Smith, with Moody’s Analytics, said, “The shortfall is somewhat misleading because it owes to a temporary reversal in motor vehicles and parts production where the trend is very strong, though the trend in manufacturing does appear a bit weaker outside of autos.
Shares of Apple Inc. (AAPL) were up slightly after the company reported record-breaking iPhone 6 pre-orders. The company said that within the first 24-hours, they surpassed 4 million pre-orders for their newly announced iPhone 6 and iPhone 6 Plus. Apple will begin delivering the new phones towards the end of the week, when the phones will actually go on sale. However, the orders have surpassed the supply of phones, which means that some will not be able to purchase a phone until next month. The new pre-orders have doubled the 2 million pre-orders they reached for the iPhone 5 when it was released in 2012. The new phones have a larger display among other new perks. Tim Cook, Chief Executive Officer at Apple, said, “We are thrilled customers love them as much as we do.”
Alibaba Group Holding has announced plans to raise the price of their initial public offering. They are the largest e-commerce company in China and have said they are going to place the IPO share price around $70, from the previously reported $66. This would possibly make it the largest IPO in history. Li Muzhi, an analyst with Arete Research Service LLP, said, “There was so much demand in the first two days, it’s reasonably to raise the price range slightly. The company might want to not be too aggressive on pricing so it can still have some upside after the listing.”
That’s all for today,
Warren Gates, Normandy Research