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10 Scary Market Numbers from the Third Quarter

10 Scary Market Numbers from the Third Quarter Morningstar

The third quarter of 2012 might have been less scary than in years past, but there was still plenty of bad news in the marketplace. Every quarter, I take a look at some numbers that jumped out at me. Here are some notable ones for the most recent three-month period:

  • 5.9%: Yield on Spanish 10-year bonds. Despite a dip after the European Central Bank's (ECB) pledge to do “whatever it takes” to save the euro, Spanish bond yields are once again near an unsustainable level as the market continues to be skeptical that Europe's plan to save itself will go off without a hitch.

  • 0: Euros worth of bonds purchased under the ECB's new Outright Monetary Transaction plan that is meant to support bond yields of indebted countries. The ECB can't act to bring down Spain's borrowing costs until the Spanish government formally agrees to a bailout from the European Commission, something Spain has been pushing off as long as possible.

  • 37%: Decline in Facebook's (FB) stock price during the third quarter. Just a reminder that the most hyped stock isn't always the best one.

  • 0.95Price/fair value of the all stocks covered by Morningstar's equity analysts. After the big run-up in stock prices during the last quarter, stocks look to be fully valued. It's getting harder to find cheap stocks.

  • 47.6: August reading of the HSBC China Manufacturing PMI, the lowest level in 41 months. The decline in China's important manufacturing sector raises big questions about the country's ability to gracefully shift down to a more sustainable growth path.

  • 2.7%: FedEx’s (FDX) global gross domestic product growth estimate for 2013, down from 3% in the previous quarter. FedEx's management sees headwinds in North America, Europe, and China dragging down industrial production and international trade.

  • -0.5%: The US Congressional Budget Office estimate for 2013 GDP growth if nothing is done to blunt the fiscal cliff. That is allowing for the expiration of a slew of tax cuts and implementing a series of mandatory spending cuts.

  • 9.1%: The US unemployment rate at the end of 2013 if the fiscal cliff isn't tackled according to the Congressional Budget Office.

  • $40 Billion: Value of mortgage-backed securities the US Federal Reserve will keep buying per month as part of its third round of quantitative easing until the employment situation improves.

  • 2%: The low end of Procter & Gamble's (PG) sales forecast for 2013 as the firm faces headwinds across the globe. Management at the maker of Ariel washing soap and Duracell batteries is trying to right the ship but this will be easier said than done. As our analyst Erin Lash puts it, "P&G overestimated its pricing and brand power of late" and the firm will need to invest smartly to turn things around.

This article was written by Bearemy Glaser and published on Morningstar under the title: 10 Scary Numbers from the Third Quarter

Tags: banking , central banks , financial crisis , global imbalances , markets , numbers , regulation , sovereign debt , topten , UK , US , US economy
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