Monthly Archives: June 2010

Gold drives Friday’s rise in stocks

Dow now at 10,444, up ten this morning.

NEW YORK (AP) — Stocks climbed Friday after another rise in gold prices lifted shares of minerals companies.
The Dow Jones industrial average rose about 15 points in midday trading after posting its first three-day gain since April. Broader indexes are also higher.
Gold prices are extending their climb after settling at record on Thursday. That is lifting shares of mining companies like Barrick Gold Corp. and Newmont Mining Corp. The stocks are up more than 2 percent.
Traders also grew more confident after European leaders said they would publish results of stress tests for banks. Investors have been concerned about European banks for months because of high debts in weak European countries like Greece.
“They need to release the results of the stress tests for people to have confidence in the conclusions,” said Stu Schweitzer, global markets strategist at J.P. Morgan’s Private Bank in New York. “The markets are in a show-me mood on the degree of rigor and disclosure of these tests.”
Meanwhile, the International Monetary Fund, the European Union and the European Central Bank also said Greece was making the necessary budget cuts to reduce its deficit. The austerity measures, which have led to protests, are required under an emergency loan package aimed at keeping the country from defaulting.
Corporate news also helped boost stocks. CVS Caremark Corp. and Walgreen Co. ended a contract dispute that threatened to hurt profits. Without the deal, thousands of Walgreen customers could have had to find somewhere else to fill prescription drugs. The companies didn’t release details of the agreement. CVS shares rose 3.1 percent, while Walgreen climbed 4.1 percent.
Bed Bath & Beyond rose 3.1 percent after an analyst said the home-goods retailer is seeing demand increase and a drop in competition.
In midday trading, the Dow rose 15.94, or 0.2 percent, to 10,450.11. The broader Standard & Poor’s 500 index rose 1.37, or 0.1 percent, to 1,117.41, and the Nasdaq composite index rose 4.42, or 0.2 percent, to 2,311.58.
The Dow is on track for its second straight weekly gain. Before that, the Dow had been down for three straight weeks. Trading since last month has been volatile. Investors are now looking for reassurances that the economic recovery will continue. Fears that a slowdown in Europe could emerge and hurt a U.S. recovery dominated trading in May but have eased in the past two weeks.
Investors have been trying to determine whether the stock market’s “correction” is over. A correction is generally considered a drop of 10-20 percent from a recent peak. The Dow is up 6.3 percent from its lowest close of the year on June 7 but it’s still down 6.9 percent from its 2010 high on April 26.
Bond prices slipped, pushing interest rates higher. The yield on the benchmark 10-year Treasury note rose to 3.23 percent from 3.20 percent late Thursday.
The dollar fell against other major currencies, while the euro fell to $1.2367.
Crude oil rose 34 cents to $77.13 per barrel on the New York Mercantile Exchange.
Barrick Gold rose $1.23, or 2.7 percent, to $46.05, and Newmont Mining climbed $1.78, or 3 percent, to $61.46.
CVS rose $1.09, or 3.4 percent, to $32.93, while Walgreen advanced $1.08, or 3.7 percent, to $30.35.
Bed Bath & Beyond rose $1.24, or 3 percent, to $42.94.
Three stocks rose for every two that fell on the New York Stock Exchange, where volume came to 806 million shares, compared with 418 million traded at the same point Thursday. Trading was heavy because of a quarterly “quadruple witching” day, or the simultaneous expiration of four kinds of options and futures contracts.
The Russell 2000 index of smaller companies rose 3.04, or 0.5 percent, to 668.89.
Britain’s FTSE 100 and Germany’s DAX index each slipped about 0.1 percent, while France’s CAC-40 rose 0.1 percent. Japan’s Nikkei stock average fell less than 0.1 percent.

Westpark Demolition to Resume

By Rachel Pritchett
A $1.2 million infusion of federal money will allow Bremerton Housing Authority to resume, but not finish, its demolition of Westpark after a 10-month pause.
“It’s good news,” BHA Executive Director Kurt Wiest said of the money from the U.S. Department of Housing and Urban Development.
The funding, a routine annual allotment, comes at a critical time as the housing authority struggles to generate more interest in Westpark. BHA is redeveloping the rundown area into Bay Vista, a
$300 million neighborhood of mixed housing with a retail and commercial core.
So far, the housing authority only has demolished about one third of the 571 dilapidated “temporary” houses built in 1940 and 1941 for shipyard workers.
Then it had to stop, because it ran out of money. That happened late last year, and the delay has set the ambitious project behind.
“We had hoped to have (the houses) taken down by the end of last year,” Wiest said.
Some of the funds for the demolition were to come from the sale of lots for individual homes. But so far, not a single one has been sold.
To continue demolition would have been putting the housing authority further out on a financial limb.
“We would have been spending money that we didn’t have with the expectation of returns that aren’t certain at this point,” Wiest said.
Demolition of the remaining old houses is to restart in the fall. It will take that long to arrange.
The portion of the $1.2 million that will go toward resuming the Westpark demolition won’t be enough to finish the job, however, according to Wiest.
The housing director also said that his agency is very close to sealing a deal with an out-of-state buyer interested in building a big apartment complex there. The purchase-and-sale agreement has been signed, Wiest said, but it probably won’t go through if some of the rest of the old houses aren’t torn down.
The agreement has a contingency giving the prospective buyers an out if the houses remain.
“They don’t want to be building a new building knowing that the old buildings are still there,” Wiest said.
The apartment complex would be located just south of one being built now by the housing authority called The Summit. When completed in a year, it will have 83 one- and two-bedroom apartments. All will have reduced rents.
The housing authority also hasn’t attracted any retail or commercial interests for its proposed Bay Vista Village, the commercial core envisioned for the 850-home Bay Vista community.
“We have to have some patience,” Wiest said.
A portion of the $1.2 million HUD funding also will be used to continue upgrades to the housing authority’s other public-housing project, Tara Heights. It’s a 21-unit complex at Tara Court and Magnolia Drive in East Bremerton.
Currently, all of the units in the 30-year-old complex are undergoing remodels that include new kitchens and baths, a new roof and heating-system improvements.

Coffee Oasis to Host Block Party

Coffee Oasis, Bremerton’s deeply rooted nonprofit group that supports homeless teens, will host a block party Saturday.
The celebration, which is free, will be from 11 a.m. to 3 p.m. and will be on Veneta Avenue between Sixth and Eighth streets in West Bremerton. Veneta will be closed to traffic.
A spokesman for Coffee Oasis said the purpose of the block part is to bring the community together and raise awareness of the resources that Coffee Oasis has that promote stability and safety for teens.
The group offers shelter, food, work and other resources.
Fun lined up for Saturday will include four live bands, a big barbecue, a graffiti competition, basketball contests and big blow-up toys for younger kids.
Local churches are also acting as hosts, and Kitsap Credit Union is the financial supporter, according to the Rev. Dave Frederick, Coffee Oasis director.
To learn more about Coffee Oasis, visit

Kitsap average $46,500 annual wage close to state average

The Associated Press
and Rachel Pritchett
OLYMPIA, Wash. — The state Employment Security Department says the average annual wage in Washington increased 1.9 percent last year to $47,153.
In Kitsap County, it was about $600 less, or $46,550.
The department said Thursday the loss of thousands of low-paying jobs contributed to the raise of the state average wage.
The average is used to compute jobless benefits, so they’ll be going up next month. The minimum weekly benefit will increase by $2 to $135 and the maximum will increase $10 to $570.
The average annual wage also is used to compute employers’ unemployment taxes and workers’ compensation benefits.
Elizabeth Scott, the Employment Security economist who specializes in Kitsap County, explained that the average annual wage varies among counties. Those with higher average annual wages often are more urbanized, with more high-wage jobs.
Counties with a greater number of low-paying jobs related to agriculture often have lower average annual wages.

Jobless claims, manufacturing report hit Thursday stocks

Dow down 44 points this morning, at 10,364.

NEW YORK (AP) — Stocks fell Thursday after a surprise increase in new claims for jobless benefits and a weaker regional manufacturing report raised concerns about the economy.
The Dow Jones industrial average fell about 50 points in afternoon trading after rising four the last five days. Broader indexes also dropped. Treasury prices rose, pushing down interest rates, after traders became more cautious.
The government said that the number of people putting in new claims for unemployment benefits rose unexpectedly last week. Initial claims for jobless benefits increased 12,000 to 472,000. That’s the highest level in a month and follows three straight weeks of declines. Economists had forecast another drop.
A plunge in the Philadelphia Federal Reserve’s index of regional manufacturing also hit stocks. The Philly Fed said manufacturing continued to expand in June but at a slower pace than in May. Its index of manufacturing activity dropped to 8 from 21.4 the month before. Traders are concerned that the slowdown signals that a recovery is fading in one of the strongest parts of the economy.
The reports provided more reminders that the economy isn’t bouncing back quickly.
“It adds up to a modest, uneven recovery,” said Paul Ballew, chief economist at Nationwide Insurance in Columbus, Ohio, and a former senior economist with the Federal Reserve. “We’re not expecting some light switch being turned on here.”
The jobs report is often the most closely watched number of the week because a recovery in the labor market is crucial to a sustained rebound in the economy. The government’s most recent monthly jobs report found that employers added only 41,000 private-sector jobs in May. That was far weaker than expected and raised concerns that a pickup in hiring was slowing. The unemployment rate fell to 9.7 percent from 9.9 percent, however.
A stronger euro helped contain some of the selling. The euro rose after a bond offering by Spain’s government drew solid demand. Traders have been concerned that European countries like Spain with high debt loads would have trouble raising money because of worries about defaults. A stronger euro is seen as a sign of confidence in Europe’s ability to cut its debt without jeopardizing an economic rebound. The euro climbed to $1.2357.
In early afternoon trading, the Dow fell 48.68, or 0.5 percent, to 10,360.48. The Standard & Poor’s 500 index fell 4.54, or 0.4 percent, to 1,110.07, and the Nasdaq composite index fell 7.25, or 0.3 percent, to 2,298.68.
Bond prices rose, pushing down interest rates. The yield on the benchmark 10-year Treasury note fell to 3.20 percent from 3.27 percent late Wednesday.
Crude oil fell 70 cents to $76.96 per barrel on the New York Mercantile Exchange. Gold rose.
Shares of BP PLC fell 20 cents to $31.65 after CEO Tony Hayward told a House panel that he was “deeply sorry” for the Gulf of Mexico rig explosion and oil spill.
Hayward’s appearance on Capitol Hill came a day after BP agreed to put $20 billion into a fund for victims of the spill and to suspend dividend payments for the rest of the year. BP had been scheduled to pay $2.6 billion in first-quarter dividends next week. The company’s shares have lost about half their value since the rig it operated exploded in April.
The government also reported that consumer prices fell for the second straight month, as expected. The Consumer Price Index dropped 0.2 percent because of a decline in the cost of gasoline and other energy expenses. However so-called core prices, which excludes often volatile food and energy costs, ticked up 0.1 percent in May. A tight job market and excess capacity at the nation’s factories are some of the forces helping to keep inflation under control.
About two stocks fell for every one that rose on the New York Stock Exchange, where volume came to 494 million shares compared with 533 million shares traded at the same point Wednesday.
The Russell 2000 index of smaller companies fell 3.11, or 0.5 percent, to 663.02.
Britain’s FTSE 100 rose 0.3 percent, Germany’s DAX index rose 0.5 percent, and France’s CAC-40 gained 0.2 percent. Japan’s Nikkei stock average fell 0.7 percent.

Average Washington wage at $47,153

This news release from the Washington Department of Employment Security.

OLYMPIA – The loss of thousands of low-paying jobs helped to increase the average wage in Washington in 2009, according to the Employment Security Department.

The 1.9 percent increase drove the average annual wage to $47,153, the smallest increase since 2004. The average weekly wage was $906.

Among other things, the average wage is used to compute unemployment-insurance benefits for jobless workers. Because the average wage increased in 2009, the minimum and maximum unemployment benefits will go up for new unemployment claims beginning next month.

The minimum weekly unemployment benefit, calculated at 15 percent of the average weekly wage, will increase by $2, to $135, for new claims opened on or after July 4. The maximum weekly benefit, calculated at 63 percent of the average weekly wage, will increase $10, to $570.

Currently, about 24 percent of unemployment-insurance claims are paid the maximum benefit amount, and 6 percent receive the minimum. Claims opened before July 4 will not see a change in the minimum or maximum benefit.

In addition to unemployment benefits, the average annual wage is used in computing employers’ unemployment taxes. Beginning in 2011, employers will pay unemployment taxes on the first $37,300 paid to each employee, up from $36,800 in 2010. As a reference point, about one-third of all employees in Washington earned more than $37,300 last year.

The state average wage also is used by the Department of Labor & Industries in calculating worker’s compensation benefits.

Wednesday stocks fall on home construction numbers

Dow down 17 points so far today, at 10,387.

NEW YORK (AP) — Stocks mostly fell Wednesday after home construction and applications for building permits slumped in May following the end of a homebuyer tax credit.
The housing report and a disappointing profit forecast from FedEx Corp. raised questions about the economic recovery. The package delivery company is seen as a barometer of the economy because shipping demand tends to increase as business conditions improve. The stock fell 2.2 percent.
Shares of BP turned higher after the New York Times reported that BP would put about $20 billion in an escrow account for claims tied to the Gulf of Mexico oil spill. BP rose 1 percent.
The Dow Jones industrial average fell about 20 points in afternoon trading. Broader indexes were mixed. The modest moves came a day after the Dow rose 214 points to its highest close in nearly a month. Stocks had risen three of the past four days.
The government’s report on housing raised concerns that weaker demand for homes will hurt an economic rebound. Construction of homes and apartments fell 10 percent from a month earlier to an annual rate of 593,000, well below the 650,000 economists had forecast. A 17 percent slide in construction of single-family homes was the largest since January 1991.
Applications for building permits fell 5.9 percent to an annual rate of 574,000, the lowest level in a year. Analysts had forecast an increase. Demand for permits is an indicator of future homebuilding activity.
The weaker-than-expected numbers come after a homebuyer tax credit expired in April.
Kevin Smith, a housing market analyst at Chapdelaine Credit Partners in New York, said the drop in the home construction and permit numbers extends a string of choppy readings since October, and that it’s too soon to tell how housing will hold up. He noted that the prior month had been the best in more than two years.
“It’s going to be a bumpy ride,” Smith said. He said housing won’t make a strong recovery until unemployment falls and overall confidence grows.
Stocks pulled off their early lows after the euro strengthened. A Spanish newspaper reported that the International Monetary Fund and European Union were trying to come up with a financial rescue for Spain. Officials in Spain denied the report. The country, like Greece and Portugal, is facing high debt loads. The euro rose to $1.2326.
U.S. markets have been tracking the moves of the 16-nation currency since major stock indexes hit their 2010 peak in late April. Traders see the shifts in the euro as a reading on confidence in Europe’s ability to cut spending without endangering an economic rebound there, which could spill over to other regions.
In midday trading, the Dow fell 19.57, or 0.2 percent, to 10,383.16. On Tuesday, the Dow ended above its average close of the past 200 days for the first time since May 19. Finishing above that level is seen as a sign of strength.
The broader Standard & Poor’s 500 index fell 2.30, or 0.2 percent, to 1,112.93, and the Nasdaq composite index rose 0.10, or less than 0.1 percent, to 2,305.98.
Bond prices rose, pushing down interest rates. The yield on the benchmark 10-year Treasury note fell to 3.28 percent from 3.31 percent late Tuesday.
The dollar rose against other major currencies and gold prices climbed.
FedEx fell $1.90, or 2.3 percent, to $81.11 after its fiscal 2011 forecast came in below analysts’ forecasts. The company said its outlook was based on the assumption of a continued “moderate recovery” in the global economy.
BP rose 29 cents to $31.69.
Crude oil rose 52 cents to $77.46 per barrel on the New York Mercantile Exchange.
About two stocks fell for every one that rose on the New York Stock Exchange, where volume came to 425 million shares compared with 372 million shares traded at the same point Tuesday.
The Russell 2000 index of smaller companies fell 1.90, or 0.3 percent, to 666.87.
Britain’s FTSE 100 rose 0.4 percent, Germany’s DAX index gained 0.3 percent, and France’s CAC-40 rose 0.4 percent.

Kitsap Gains 600 Jobs: UPDATE

By Rachel Pritchett
Kitsap County added 600 new jobs in May, divided evenly among construction, retail and leisure and hospitality.
Those have been some of the biggest losers in this lingering recession.
That news came from the Washington Department of Employment Security, which also said the 7.5 percent May unemployment rate for Kitsap County remained almost unchanged from April.
April’s revised 7.4 percent followed a 1 point drop from March, led by feeble new life detected in the retail jobs sector.
State economist Elizabeth Scott said the local addition of jobs was very significant in this recession, which she called the slowest recession to regain jobs of all 11 recessions since the end of World War II.
“”It’s extremely good news because we’re beginning to see that tail of the graph start flipping up higher,” said Scott, who is based in Bremerton.
Kitsap’s total labor force stood at 83,500 in May, but 9,480 persons are unemployed locally, a gain of 100 over April.
The good news on the private front was tempered by a loss of 100 state government jobs in Kitsap County in May. Local and federal government employment was unchanged.
Kitsap’s unemployment rate remains substantially lower than the state’s 9.1 percent rate for May, down from 9.3 percent in April. The national unemployment rate in May was 9.7 percent.
The state economy expanded by 8,600 jobs last month, many of the temporary federal census jobs.
Industries that added jobs in May on the state level were government, construction, professional and business services and retail.
Those that lost jobs included financial activities, manufacturing, leisure and hospitality and transportation.
“It’s refreshing to talk about job growth and a falling unemployment rate,” said Employment Security Commissioner Karen Lee. “The momentum seems to be shifting in the right direction.”
The number of people in Kitsap County who filed for unemployment compensation in May fell 16 percent to 1,160 people from April. The number of people continuing to receive unemployment checks fell 8 percent to 3,608.
However, Washington in May had 27,000 fewer jobs than in May 2009, and more than 265,000 people received unemployment benefits in May meaning the recession is far from over.