China’s inflation rose to 3.6% in March, mostly because of food prices. A number of economists said the move was an anomaly. That is only true if food supplies stabilize, which is by no means assured. China’s imports of corn already have reached record levels, as far as outsiders can tell. Wheat and soybean imports also continue to rise, as the ability of the People’s Republic to get its farm produce to cover all the nation’s needs falters. And China’s other large commodity import — oil — continues to sell for a high price.

First-Quarter Earnings

Companies will begin to release first quarter results this week. S&P says it expects a sharp slowdown in earnings improvements among the S&P 500. This, in turn, could knock the stock market advance off its axis. It may not take much. The S&P 500 is up nearly 10% over the past three months. New concerns about the economy began last week as the jobs report for March was worse than expected. High gasoline and oil prices are the subject of everyday conversations by analysis and economists. Earnings may be the last weight on the pile. It appears the advance of the markets may be over.

iPhone 5 Rumors

There is more speculation about the release of the new Apple (NASDAQ: AAPL) iPhone 5 than about who will win the presidential election. Both could be settled at about the same time. Companies that do business with huge Apple supplier Foxconn claim the launch of the iPhone 5 will be in June or July. Other predictions put it a quarter later. The real question about the launch is what Apple will add to a product that already has record demand. If the new iPad is any indication, the iPhone 5 will have a stronger processor, the ability to work on superfast 4G networks and better screen resolution. It will need at least those things to distinguish it from the hot-selling iPhone 4S.

A Bloomin’ IPO

Bloomin’ Brands, the owner of Outback Steakhouse, will try to raise $300 million through an initial public offering. The deal may succeed, although the company’s other brands — Carrabba’s Italian Grill, Bonefish Grill, Fleming’s Prime Steakhouse & Wine Bar and Roy’s Hawaiian Fusion Cuisine — are hardly known. Much larger competitor Burger King will set an IPO date soon. McDonald’s (NYSE: MCD) has been on a run of record results and stock buybacks. Results from KFC locations in China have driven shares of Yum! Brands (NYSE: YUM) to new highs. If Bloomin’ Brands plans to exploit the markets, there cannot be a better time.

Douglas A. McIntyre

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