Daily Data Flow: Earnings Yield Hits 58-Year High; Deficit to Fall to $642 Billion; Yen, Euro Down

Stocks Earnings Yield Hits 58-Year High (CNBC)
A strong earnings yield sent stocks in the S&P 500 to a 58-year high earlier today. Although the 5.4 percent earnings yield is still below its historical average, the number is nearly triple the 1.9-percent yield of a 10-year Treasury note. “Since stocks are yielding nearly three times in EPS what bonds are yielding in interest, history suggests that stocks may be the more attractively valued asset class,” said Sam Stovall, chief equity strategist at S&P Capital IQ.

CBO Estimates Deficit will Fall to $642 Billion (Bloomberg)
The U.S. budget deficit will shrink to $642 billion this year, making it the smallest shortfall in five years, according to a new government report. The nonpartisan Congressional Budget Office (CBO) today came to its conclusion based off of the stronger-than-expected tax receipts and payments to the Treasury by government-owned mortgage financiers Fannie Mae and Freddie Mac. This change would mark the first time since 2008 that the gap between taxing and spending slipped below $1 trillion.

Yen Falls to Lowest Level in 4-1/2 Years, Euro Down (Reuters)
The yen and the euro both fell against the U.S. dollar today for a fourth straight session, with the yen reaching its lowest level against the dollar in four and a half years. The aggressive monetary policy action from the Bank of Japan and expectations that the Federal Reserve will taper its monthly bond buying soon have aided the dollar’s climb against the yen. “The unprecedented amount of monetary easing in Japan is one factor, the other in the next few months is a deteriorating current account,” said Tatjana Michel, director of currency analysis at Charles Schwab in San Francisco of ongoing yen weakness. “Japan exports do better but imports become more expensive.”