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21May2015 Market Close: SP500 Closes Higher On Worries That The Fed Won't Raise Rates In June

Written by Gary

U.S. Averages rose this afternoon, with the S&P 500 just shy of its previous record high even as disappointing economic data came in this morning. The view that an interest rate hike would come only later in the year bolstered the U.S. stocks to climb higher on light volume. Oil Prices were higher as US dollar slips.

Todays S&P 500 Chart

The Market in Perspective

Here are the headlines moving the markets.

Deutsche Bank's Jain Must Now Deliver

The co-chief executive has been given more power to lead the German bank's strategy. His chairman should only give him a year to show real results.

Wall Street higher as rate hike worries fade; S&P near record

(Reuters) - Wall Street was higher in late morning trading on Thursday, with the S&P 500 a whisker away from a record high, as a fresh batch of disappointing economic data bolstered expectations that the Federal Reserve would not raise interest rates any time soon.

Thousands Gather At McDonald's Headquarters Demanding Higher Wages

On Wednesday, we got a look at a leaked WalMart training video in which a series of "associates" (read: hilariously bad actors) patiently explain to new hires why unions are bad.

The video is especially relevant in light of the retailer's recent battle with intractable "clogs and leaks" at several locations and if "clogs and leaks" actually means "unions" then it makes a lot of sense why the company closed its Pico Rivera location because if ever there were a WalMart store that suffered from stubborn "plumbing problems" then Pico Rivera is surely it.

But WalMart isn't the only giant multinational that just can't seem to get the "plumbing" fixed because as you'll see below, legions of McDonald's workers descended on the company's Illinois headquarters ahead of the annual shareholders meeting in an effort to show the company that they are most assuredly not "Lovin' It."

Here's The Chicago Tribune:

Potesters hailing from as far away as Kansas City and New York City participated in a demonstration at McDonald's Oak Brook headquarters Wednesday, urging that hourly wages for the burger giant's front-line workers be increased to $15 an hour.

Darrell Miller, 35, who said he left Kansas City, Mo., Tuesday night on a bus filled with other protesters, said he decided to join in because it was his dream to march like the Rev. Martin Luther King Jr. and fight for freedom.

His job at McDonald's, he said, gives him no control over his l ...

Alibaba-Backed E-Commerce Services Firm's IPO Pricing Disappoints

A Chinese e-commerce services firm backed by Alibaba Group raised a lower-than-expected $110 million in a New York initial public offering, in a potential sign of skepticism from U.S. investors about Chinese Internet stocks.

Food Companies Fear Bird Flu May Cause Egg Shortages

The flu is forcing farmers to kill more than 38 million infected birds, 33 million of which are laying hens.

U.S., euro zone business growth slower, China contracts

LONDON/NEW YORK (Reuters) - U.S. and euro zone business growth slowed in May while China's factory sector contracted again, reinforcing the need for major central banks to continue supporting economic growth.

"We Reached The Tipping Point": Income Inequality Is Highest Since Records Began

While soaring stock prices do nothing to boost the economy, because as 7 years of hard facts have shown, the only thing "trickle down" QE has done is forced economists to jump the shark and demand not one but two seasonal adjustments to goal seek collapsing economic data, the S&P hitting new all time highs on a daily basis has certainly succeeded in one thing: pushing inequality around the globe, and especially in the US, to new record highs.

And earlier today the latest OECD report confirmed just that, when it reported that gap between the rich and poor in most of the world's advanced economies is at record levels.

In most of the 34 countries in the Organisation for Economic Cooperation and Development the income gap is at its highest level in three decades, with the richest 10 percent of the population earning 9.6 times the income of the poorest 10 percent.

In the 1980s this ratio stood at 7 to 1, the OECD said in a report.

The wealth gap is even larger, with the top 1 percent owning 18 percent and the 40 percent only 3 percent of household wealth in 2012.

"We have reached a tipping point. Inequality in OECD countries is at its highest since records began," said OECD Secretary-General Angel Gurria.

Keep in mind this only looks at earnings, which have actually slowed down in recent years, and ignores the massive imbalance in accumulated assets: assets which almost exclusively are controlled by the top 10%. As ...

Spot The 'Fundamental' Difference

Misses:

China PMI
German PMI
US PMI
Initial Claims
Chicago Fed
Existing Home Sales
Philly Fed
Kansas City Fed

-> Stock at all time high

@ zerohedge (@zerohedge) May 21, 2015

But none of that matters:

As goes oil... so goes US equities...

Charts: Bloomberg

CVS to expand pharmacy business with $10.1 billion Omnicare buy

(Reuters) - Drugstore operator CVS Health Corp said Thursday it will spend $10.1 billion to buy Omnicare Inc , a company that supplies prescription medicines to nursing, assisted living and other healthcare facilities.

Bond Selloff Boosts Lure of Italy, Spain

Southern European bond yields have risen sharply. It may be time to take a closer look at Italian and Spanish debt.

Kansas City Fed In Recession Territory After Respondent "Laid Off 8% Of Workforce In 2 Months"

For the 5th month in a row, Kansas City Fed missed expectations by an inmcreaisngly large amount. May's -13 print is the worst since April 2009, and is the biggest drop since 2009. Every single individual component also tumbled led by orders, backlog, number of employees and average workweek. Firmly in recession territory, the respondents comments are stunningly reminiscent of the great recession (or depression)...

Recession.. .or no recession!?

The breakdown is a disaster...

Some respondents said:

"We had a good first quarter but the brakes have been applied since the start of May. Looks like our business will be down compared to last May."

"It is becoming increasingly difficult to find qualified job candidates who are not carrying some form of personal baggage / problem."

"We are continuing to operate at full capacity but the volume of new orders has slowed sig ...

Crash Contagion: Second Chinese Billionaire Wiped Out In Seconds After Stock Instacrash

Yesterday China's richest man, Li Hejun, lost more than half his fortune when his solar company stock suddenly crashed over 50%. Overnight it happened again, and Hong Kong's securities regulator, warned other investors to exercise "extreme caution," as Hong Kong's best-performing stocks this year are crashing in a serial, tulip-like manner. And another billionaire was promptly wiped out: Pan Sutong started the day engorged with wealth after his companies Goldin Financial and Goldin Properties had risen 300% this year. By the close he had lost 60% of his wealth!

What goes up... crashes to floor in a wealth-destroying frenzy...

"It's a contagion effect," said Nick Cheng, chief derivatives trader at Liquid Capital Markets Ltd. in Hong Kong.

Investors "are now rushing to take profit and everyone's suddenly running for the exit," he said.

The volatility "will damage investor confidence with such a reputable stock exchange."

As Bloomberg reports,

Hong Kong's best-performing stocks this year are tumbling even faster than they rallied.

Goldin Financial Holdings Ltd. and Goldin Properties Holdings Ltd., controlled by billionaire Pan Sutong, plunged more than 60 percent in Hong Kong trading Thursday. There was no immediate explanation for the drop. Before the rout, the tw ...

Best Buy profit beats on strong demand for TVs, smartphones

(Reuters) - Best Buy Co Inc , the largest U.S. consumer electronics chain, reported better-than-expected quarterly profit and sales, helped by strong demand for smartphones and large-screen TVs, sending its shares up over 8 percent.

Low U.S. Rail Spending Leads to Poor Safety, Experts Say

The fatal Amtrak derailment in Philadelphia last week highlights a lesson already learned by many other nations: You get what you pay for.

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To contact me with questions, comments or constructive criticism is always encouraged and appreciated:

gary@econintersect.com

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