Afternoon trading on Wall Street has the DOW down triple digits, SP500 down -0.8% and the $NDX down over 1% following tepid economic data and losses in healthcare and consumer discretionary stocks. Consumer spending increased 0.4%. Dow component Pfizer reported an adjusted 2Q profit, topping the estimate for $0.62.
Here is the current market situation from CNN Money
BEIJING (Reuters) - A raft of global risks that could adversely affect the United States remains on the horizon and requires close monitoring, Dallas Federal Reserve Bank President Robert Kaplan said on Tuesday.
DETROIT (Reuters) - Four major automakers in the U.S. market on Tuesday reported July vehicle sales slightly below expectations as the pent-up demand that has helped drive sales since 2009 plays itself out.
NEW YORK (Reuters) - Pfizer Inc on Tuesday said it has reached a $486 million settlement of litigation accusing it of causing big losses for shareholders by concealing safety risks associated with its Celebrex and Bextra pain-relieving drugs.
NEW YORK/ZURICH (Reuters) - Swiss digital TV security company Kudelski on Tuesday reached a settlement with Apple Inc, ending a patent dispute in the United States and Europe and removing a threat to Apple's video streaming features in devices sold in Germany.
BEIJING (Reuters) - A merger between Chinese ride-hailing firm Didi Chuxing and the China unit of U.S. rival Uber could face its first hiccup after China's commerce ministry (Mofcom) said on Tuesday it had not received a necessary application to allow the deal to go ahead.
(Reuters) - Miners that produce a diverse commodity mix may be willing to part with fertilizer assets, creating buying opportunities for producers of potash and phosphate, Mosaic Co Chief Executive Joc O'Rourke said on Tuesday.
According to our friends at TrimTabs, contrary to speculation that "money remains on the sidelines", far from the "most hated rally ever", the month of July saw a near-record $43.0 billion in new cash added to bond, commodity, and equity exchange-traded funds in July, the biggest monthly inflow since December 2014, when these funds hauled in $50.7 billion.
Why the dramatic allocation away from cash and to risk assets? "Fund flows suggest market participants are as confident as ever that central bank intervention will keep inflating asset prices," said David Santschi, chief executive officer at TrimTabs.
As Santschi points out, "the only major asset class with significant outflows last month was European equities." Europe-focused equity ETFs shed a record $4.5 billion, equal to 10.5% of their assets.
In a research note, TrimTabs reported that July's inflow into ETFs was equal to almost half of the year-to-date inflow of $103.2 billion. U.S. equity ETFs alone took in $27.9 billion, equal to 2.0% of their assets, the biggest monthly inflow since December 2014.
"Several of the riskiest areas of the market, including emerging markets stocks and foreign bonds, had massive inflows," said Santschi. "Such enthusiasm is a cautionary sign from a contrarian perspective."
Perhaps that's true, but keep in mind that in just three weeks that the buyback blackout period will be over and companies will rush to take the place of investors as marginal buyers, in the form of stock repurchases. And, as Goldman reiterated over the weekend, 2016 is about to be another record for buybacks, which are now expected to ...
I came up with the idea of "World Out of Whack" while out on a training run. With all the insanity in financial markets, documenting those which are weirder than a 3-dollar bill would make for an interesting exercise. And besides, we're covering these markets for our own personal investment and trading purposes.
In last week's edition we discussed helicopter money.
(if you haven't read it yet, I encourage you to do so here)
I received a deluge of emails as a result. I do read them all but simply cannot respond to all of them - my apologies.
There were two main themes of questions emanating from the article, and in today's podcast I cover them both. It is short and sweet and I hope you enjoy it.
Well that escalated quickly. Having toyed with the $39-handle yesterday, this morning's plunge has erased those stops:
... and WTI is set to test the early April lows on the way back to 2016 lows...
What is next for oil now that key support is broken?: some thoughts from BofA's chief technician, Paul Ciana:
Oil has reached the triangle top target (40.80) we reported on in early July. Today oil is extending its decline, breaking the 200d SMA and testing support at the round number of $40. Short term measurements shown in Table 1 and Table 2 suggest oil could bounce this week (as much as a 65% possibility) and test resistance at $43.18 or $44.50. However that bounce may be short lived and we think sold. The weekly chart shows momentum isn't oversold yet and deeper Fibonacci retracement levels at $38.86 and $35.84 could be reached as a larger oil market bottom pattern forms. Oil in the mid $30's which is near the 61.8% retracement and bottom of the weekly Ichimoku cloud would be a more technically convenient long trade scenario.
Price action has moved to the center of the weekly Ichimoku cloud. The cloud offers support as low as $35.40 and r ...
The major U.S. benchmarks are off to a soft August start, pulling in from the 2016 peaks. Against this backdrop, the S&P 500 is pressing first support — spanning from about 2,155 to 2,159 — an area defining the immediate bull-bear battleground.
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