Tuesday, May 30, 2017

Morning Market Internals

Posted by Gary .....at 10:18 AM
NYSE Composite Index:
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Monday, May 29, 2017

Tuesday Watch

Posted by Gary .....at 9:12 PM
Today's Headlines
Bloomberg:
  • Draghi Says Euro Area Still Requires ECB Monetary Support. (video) The euro area still needs expansive monetary stimulus to restore stable inflation even as its economy accelerates, European Central Bank President Mario Draghi said. “We remain firmly convinced that an extraordinary amount of monetary policy support, including through our forward guidance, is still necessary,” Draghi told lawmakers on Monday in Brussels. “Domestic cost pressures, notably from wages, are still insufficient to support a durable and self-sustaining convergence of inflation toward our medium-term objective.”
  • Merkel Says U.S. Ties Shouldn't Deter Europe From Own Path. German Chancellor Angela Merkel said she remains a “committed trans-Atlanticist” who wants strong ties with the U.S., even as she renewed her warning that reliable relations with her country’s closest post-World War II ally may be a thing of the past. Following global reaction to comments she made Sunday, Merkel stood her ground for a second day, saying it was good that last week’s Group of Seven summit “didn’t paper over” a clash on climate change that pitted President Donald Trump against the other six leaders.
  • Luxury Spending to Rebound in 2017 on Europe, China, Bain Says. Tourism in Spain and the U.K. will lead a rebound in European luxury spending this year, while Chinese domestic consumption also increases, Bain & Co. said, raising its forecast for global growth in 2017. Sales of items such as designer handbags and fine jewelry will rise 2 percent to 4 percent to as much as 259 billion euros ($290 billion), Bain said in a report Monday. The consultancy had predicted growth of 1 percent to 2 percent in December, and the forecasts exclude currency swings.
  • Robots May Help Defuse Demographic Time Bomb in Japan, Germany. Manufacturing powerhouses will find it easier to adapt. Japan and Germany may be sitting on a ticking demographic time bomb where aging populations begin to drag down economic growth. Good thing they’re also prime candidates for robot revolutions. Increased automation and more use of robotic technology in these manufacturing powerhouses could help cushion the impact, according to Moody’s Investors Service.
  • Stocks Meander in Holiday-Hit Trading; Pound Rises. Global stocks were mixed and the dollar and euro traded sideways amid thin trading as investors weighed the latest comments from a Federal Reserve official on the path of U.S. borrowing costs and Mario Draghi’s dovish message to the European Parliament. With markets in the U.K., U.S. and China closed for holidays, volumes were depressed, limiting price movements. Sterling led gains among G-10 currencies as it recouped some of Friday’s retreat, and Italian assets fell as former Prime Minister Matteo Renzi raised the prospect of an early election. Brazil’s real dropped in the wake of Friday’s decision by Moody’s Investors Service to lower the country’s credit outlook, while Mexico’s peso was little changed even after bullish wagers fell. South Africa’s rand dropped after President Jacob Zuma survived a bid by some members of his party to oust him. The Stoxx Europe 600 Index fell by less than 0.1 percent as of 12:57 p.m. in New York.
    Futures on the S&P 500 Index rose by less than 0.1 percent after the underlying gauge closed at a record high on Friday    .
Wall Street Journal:
  • What We Remember on Memorial Day. From the Civil War to Vietnam and beyond, Americans have struggled to reconcile the duty to honor the war dead with the need to pass historical judgment.
Zero Hedge: 
Night Trading
  • Asian indices are -.25% to unch. on average.
  • Asia Ex-Japan Investment Grade CDS Index 90.75 +.25 basis point.
  • Asia Pacific Sovereign CDS Index 19.25 unch.
  • Bloomberg Emerging Markets Currency Index 72.91 -.11%.
  • S&P 500 futures +.03%.
  • NASDAQ 100 futures +.04%.

Earnings of Note
Company/Estimate
  • (AMWD)/1.01
  • (PRGO)/1.01
  • (NX)/.05
Economic Releases
8:30 am EST
  • Personal Income for April is estimated to rise +.4% versus a +.2% gain in March. 
  • Personal Spending for April is estimated to rise +.4% versus unch. in March.
  • The PCE Core MoM for April is estimated to rise +.1% versus a -.1% decline in March.
9:00 am EST
  • The S&P CoreLogic CS 20-City MoM for March is estimated to rise +.8% versus a +.69% gain in February.
10:00 am EST
  • The Conference Board Consumer Confidence Index for May is estimated to fall to 119.9 versus 120.3 in April.
10:30 am EST
  • Dallas Fed Manufacturing Activity for May is estimated to fall to 15.5 versus 16.8 in April.
Upcoming Splits
  • None of note
Other Potential Market Movers
  • The Eurozone CPI report, Deutsche Bank Financial Services Conference and the KeyBanc Industrial/Automotive/Transports Conference could also impact trading today.
BOTTOM LINE: Asian indices are slightly lower, weighed down by commodity and financial shares in the region. I expect US stocks to open mixed and to rally into the afternoon, finishing modestly higher. The Portfolio is 100% net long heading into the week.

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Weekly Outlook

Posted by Gary .....at 9:02 PM
BOTTOM LINE: I expect US stocks to finish the week modestly higher on yen weakness, oil strength, less European/Emerging Markets/US High-Yield Debt Angst, economic optimism, technical buying and short-covering. My intermediate-term trading indicators are giving neutral signals and the Portfolio is 100% net long heading into the week.
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Sunday, May 28, 2017

Today's Headlines

Posted by Gary .....at 8:41 PM
Bloomberg:
  • Early China Data Shows Slowdown Biting Amid Credit Tightening. The first hints of China’s economic performance this month suggest that a slowdown in growth is taking hold, as policy makers beef up efforts to clamp down on financial risks. The international-investor optimism that dominated in the earlier part of the year is now souring, as curbs on leverage push up the cost of domestic borrowing. Small and medium-sized companies are also reporting dented confidence, and sentiment among sales managers and in the steel market worsened. A surprise cut in China’s debt rating by Moody’s Investors Service last week may mark a turning point for the world’s second-largest economy, as momentum weakens following a better-than-expected expansion in the first quarter. Yet the gloom shouldn’t spread too far, with consumers still spending, factory-gate prices gaining and home prices defying predictions of a hard landing.
  • Merkel Tells Beer Tent Rally That Europe Must Plot Own Course. German Chancellor Angela Merkel said Europe must plot its own course as she plunged back onto the campaign trail 17 weeks ahead of national elections. Fresh from a Group of Seven summit marked by a recalcitrant U.S. President Donald Trump, Merkel sought to shore up support in her bid for a fourth term on Sunday in a Bavarian beer tent, speaking to supporters of her Christian Social Union sister party, which has been hostile to her refugee policy.
  • Mattis Says U.S. Plans to ‘Take Apart’ Islamic State Caliphate. The fight against Islamic State has shifted to “annihilation tactics” to stop potential terrorists who’ve flocked to places such as Iraq and Syria from returning to their home countries to wreak havoc, Defense Secretary James Mattis said Sunday. In his first interview on a Sunday talk show since joining the Trump administration in January, Mattis provided details of the tactical shift he announced at the Pentagon on May 19. “We have already shifted from attrition tactics where we shove them from one position to another in Iraq and Syria,” Mattis said on “Face the Nation” on CBS. “Our intention is that the foreign fighters do not survive the fight to return home to North Africa, to Europe, to America, to Asia, to Africa.”
  • BMW to Stop Production in China, South Africa on Supply Shortage. BMW AG is set to extend production halts in Germany to China and South Africa on Monday as the luxury-car maker grapples with a shortage of steering parts. Production at the factories in Shenyang and Rosslyn is likely to stop for a day, while its plant in Leipzig, Germany, is expected to be partially shuttered, spokesman Michael Rebstock said. The Leipzig site has been closed since Friday, and another facility in Munich was affected last week as an unidentified Italian car-parts supplier has been unable to make the required deliveries, magazine Focus reported earlier Sunday.
  • Stocks Mixed as Yen Rises; Rand Pares Gain on Zuma. The yen rose 0.1 percent to 111.22 per dollar as of 9:12 a.m. in Tokyo. The Topix index fell 0.1 percent. The Kospi added 0.4 percent and Australia’s S&P/ASX 200 Index fell 0.3 percent. The yield on 10-year Treasuries was 2.25 percent at the end of last week. The rand rose 0.4 percent to 12.821 per dollar. The decision increases the chances that Zuma will survive a no-confidence motion called by opposition parties in parliament, whether or not the Constitutional Court orders a secret ballot for the vote. ANC lawmakers occupy 62 percent of the 400 seats in the National Assembly. The Aussie slid 0.1 percent to 74.39 U.S. cents.
Wall Street Journal:
Zero Hedge:
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Saturday, May 27, 2017

Today's Headlines

Posted by Gary .....at 1:35 PM
Bloomberg:
  • Trump Goes His Own Way as G-7 Cobbles Together a Form of Unity. U.S. President Donald Trump showed his determination to break the global mold as he refused to follow the Group of Seven line on climate change and forced a more skeptical approach to free trade. A summit of G-7 leaders in Sicily wrapped up on Saturday with a fragile truce on the two most contentious topics on the table. The U.S. pushed back on worldwide efforts to curb global warming that Trump’s predecessor had signed up to and won a reference in the final statement on the need for trade to be “free, fair and mutually beneficial.”
  • Macron Erupts On World Stage With Trump Snub and a Bromance. On a sun-kissed terrace overlooking the sea, the image of Emmanuel Macron and Justin Trudeau staring into each other’s eyes had social media swooning over the budding bromance between the two young leaders at the Group of Seven in Sicily. But just 24 hours earlier in Brussels, Macron had crushed Donald Trump’s hand until his knuckles turned white and walked past the U.S. president to embrace German Chancellor Angela Merkel on the blue NATO welcome carpet.
  • China's Industrial Profits Rise 14% as Global Trade Improves. Chinese industrial profits rose 14 percent in April from a year earlier as global trade increased. Industrial profits climbed to 572.8 billion yuan ($83.6 billion) last month, the National Bureau of Statistics said Saturday. That compares with a jump of 23.8 percent in March, and an 8.5 percent increase last year. Output in the world’s largest manufacturing nation is booming on the back of stronger global trade and investment, handing producers better pricing power. China’s exporters are capitalizing on the improved demand amid concern that the global economy may slow in the longer term.
  • U.K. Lowers Threat Level as May Urges Public to Remain Vigilant. Prime Minister Theresa May said the U.K. terror threat has been lowered to "severe" from "critical" following a number of arrests related to Monday’s terrorist attack in Manchester. May led a meeting of the government’s emergency committee Saturday morning, during which she was updated by police and security services on the investigation into the suicide bombing at a pop concert that killed 22 people. The threat level had been raised to the highest category on Tuesday.
  • Pope Denounces Speculators in Visit to Industrial Workers. Pope Francis highlighted the struggles workers face in a globalizing economy with a visit Saturday to a troubled steel factory in Genoa, where he stressed the importance of work in giving people a sense of human dignity and denounced those who exploit workers. The visit puts a focus on the plight of workers whose lives have been made precarious by years of economic crisis, including in Italy where a high jobless rate, especially among young adults, drives many to leave the country.
Wall Street Journal: 
  • What We Remember on Memorial Day. From the Civil War to Vietnam and beyond, Americans have struggled to reconcile the duty to honor the war dead with the need to pass historical judgment.
  • Rural America Is the New ‘Inner City’. A Wall Street Journal analysis shows that since the 1990s, sparsely populated counties have replaced large cities as America’s most troubled areas by key measures of socioeconomic well-being—a decline that’s accelerating.
Barron's:
  • Had bullish commentary on (IP), (F), (YHOO), (BIDU) and (LVS).
Zero Hedge:
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Friday, May 26, 2017

Market Week in Review

Posted by Gary .....at 3:34 PM
  • S&P 500 2,415.83 +1.42%*
photo hyq_zpsgnimgpvb.png

 The Weekly Wrap by Briefing.com.

*5-Day Change
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