U.S. markets flat despite job news
NEW YORK, Dec. 30 (UPI) -- U.S. markets slid Thursday, despite a sharp drop in first-time unemployment benefit claims, which declined by 34,000 in the week ending Dec. 25.
The four-week rolling average for initial claims dropped by 12,500 to 414,000, as the weekly total of 388,000 first-time claims was the lowest since July 2008.
On Wall Street, markets were essentially flat, but trending lower. In late morning trading, the Dow Jones industrial average lost 23.92 points, 0.21 percent, to 11,561.46. The Standard & Poor's 500 index shed 2.69, or 0.21 percent, to 1,257.09. The Nasdaq composite index lost 3.27, or 0.12 percent, to 2,663.66.
The 10-year treasury note lost 14/32 to yield 3.409 percent.
The euro rose to $1.3274 from Wednesday's $1.322. Against the yen, the dollar rose to 81.82 yen from Wednesday's 81.63 yen.
In Tokyo, the Nikkei 225 index dropped 1.12 percent, 115.62 points, to 10,228.92.
U.S. banks report business loan upturn
NEW YORK, Dec. 30 (UPI) -- Some of the largest U.S. banks have increased their lending to companies, research firm Moody's Analytics said.
Increased lending to businesses is a sign that hiring may be around the corner, as a percentage of loans normally goes to business expansion, The Wall Street Journal reported Thursday.
JPMorgan Chase & Co. said lending to companies with revenues between $10 million and $500 million rose by 7 percent in 2010, while lending to smaller firms rose 40 percent.
Moody's Analytics estimated lending to businesses rose 0.2 percent to $1.22 trillion in the fourth quarter and that commercial lending would rise 3 percent next year.
The 0.2 percent rise might sound paltry, but it is the first increase in two years, the Journal said.
U.S. Bancorp in the Midwest said its commercial loans were up 0.7 percent in the third quarter compared to the previous three months.
Wells Fargo and Bank of America also said lending was higher in recent quarters. City National Corp., Comerica, BB&T and others also reported upturns or signs of optimism. Wells Fargo, for example, recently increased Illinois timber products distributor Aetna Plywood Inc.'s line of credit by $8 million, in part to increase inventory.
"There is no miracle happening, but a slow progression of continued growth, and we believe that will continue," said Larry Rassin, Aetna Plywood's owner and president.
Pending homes sales rose in November
WASHINGTON, Dec. 30 (UPI) -- Pending U.S. home sales rose 3.5 percent in November, following a 10.4 percent jump in the previous month, the National Association of Realtors said Thursday.
The Pending Home Sales Index, which predicts home closings one and two months down the road, rose to 92.2 after from a revised 89.1 for October, NAR said.
The index pulled up to 5 percent below November 2009. A month ago, the index was 20.5 percent below October 2009.
"In addition to exceptionally affordable conditions, steady improvements in the economy are helping bring buyers into the market," said NAR Chief Economist Lawrence Yun.
In a statement, Yun acknowledged, "Further gains are needed to reach normal levels of sales activity."
The trade group said the pending home sales index rose 1.8 percent to 72.6 in November in the Northeast and dropped 4.2 percent to 78.3 in the Midwest. In the South, the index dipped 1.8 percent to 91.4. In the West, the index jumped 18.2 percent to 123.3.
Why people are apt to spend, not save
NEW YORK, Dec. 30 (UPI) -- Consumers are apt to spend their money instead of saving for the future because they have trouble connecting to their future selves, U.S. researchers say.
Study authors Daniel M. Bartels of the Columbia Business School and Oleg Urminsky of the University of Chicago say when people think about saving money for the future, the person they think of can seem different from the person they know now.
In other words, people have trouble sacrificing in the present for that stranger in the future.
In one study, the researchers had graduating seniors read one of two narratives: The first indicated that their self-identity was already fully formed and would not change after graduation, while the other passage indicated that graduation would change their self-identities.
"When seniors were told that graduation would lead to major changes in identity, they reported feeling less connected to their future selves," the study authors say in a statement. "Those thinking about changes in identity were also more impatient, choosing less-valuable gift certificates that would be available sooner over higher-valued gift certificates that required waiting a year."
When people fail to save for the future, they may not be making a mistake or failing to exercise self-discipline -- they simply don't fully recognize benefits that their future selves will receive, the researchers say.
The findings are published in the Journal of Consumer Research.
