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04Aug2016 Market Close: Wall Street Closes Flat, Mixed And Low Volume As Investors Wait For Jobs Report Tomorrow

Written by Gary

Wall Street traded mostly flat and mixed on low volume and held near the unchanged mark today as investors exercised caution ahead of Friday's U.S. payrolls report. US stocks relinquish modest gains to trade mostly flat as WTI crude jumps 2% extending rally from 3-month lows, amid some short covering. Short-term indicators show a bullish position, but the swing-traders are telling a different story.

Todays S&P 500 Chart

The Market in Perspective

Here are the headlines moving the markets.

U.S. jobless claims rise marginally, factory orders decline

WASHINGTON (Reuters) - The number of Americans filing for unemployment benefits unexpectedly rose last week, while renewed job cuts in the energy sector boosted layoffs announced by U.S.-based employers in July.

Wall St. little changed as jobs data looms

NEW YORK (Reuters) - Wall Street held near the unchanged mark on Thursday as investors exercised caution ahead of Friday's U.S. payrolls report.

New U.S. mortgage rules aim to stop wrongful foreclosures

WASHINGTON (Reuters) - The U.S. agency charged with protecting consumers' finances approved rules on Thursday that will help prevent wrongful home foreclosures, as the regulator continues to press on with reforming the country's massive lending market.

Away from spotlight, U.S. manufacturers battle back from 'China shock'

HICKORY, North Carolina (Reuters) - As furniture makers left Hickory and headed to China at the start of the century, the local community college shuttered its courses in furniture production, abandoning an industry that had sustained this North Carolina community for generations.

Investor Wilbur Ross urges Trump not to let his behavior become the issue

NEW YORK (Reuters) - Billionaire investor Wilbur Ross stood behind Republican Donald Trump but urged him to stop engaging in exchanges that benefit the Democrats and make the real estate mogul's behavior the issue in the U.S. presidential campaign.

Iran nuclear pact opponents lobby in U.S. against Boeing, Airbus deals

WASHINGTON (Reuters) - As the U.S. Treasury Department decides whether to license sales of Boeing Co and Airbus commercial aircraft to Iran, opponents of last year's nuclear pact with the Islamic republic have launched a lobbying campaign against the deals.

Business groups sue over new U.S. limit on tax-driven foreign buyouts

NEW YORK/WASHINGTON (Reuters) - Two business groups sued the Obama administration on Thursday over a crackdown on U.S. companies that try to reduce their U.S. taxes by rebasing abroad in a process known as inversion.

Exclusive: Wal-Mart installs new worker scheduling system in 650 U.S. stores

CHICAGO (Reuters) - Wal-Mart Stores Inc has implemented a new scheduling system for hourly employees at 650 U.S. stores, which lets the company focus on serving peak shopping times while allowing employees to exercise scheduling preferences, according to company sources and interviews with store workers.

Judge for U.S. lawsuits to stop insurance mergers may drop one case

WASHINGTON (Reuters) - The judge assigned to rule whether the U.S. government can block the mega-mergers of health insurers Aetna Inc and Humana Inc , and Anthem Inc and Cigna Corp said on Thursday it would be difficult for him to decide both cases by the end of the year.

Vegan Food Startup Hampton Creek Used Venture Capital To Buy Its Own Products

Call it the perfect pyramid scheme for the "new normal."

In the latest example of the venture capital euphoria that has dominated the US in recent years, not to mention potential fraud, Bloomberg reports that vegan food startup Hampton Creek, had a novel idea of how to spend the venture funding it had raised: by buying up its own product. To wit:

In late 2014, fledgling entrepreneur Josh Tetrick persuaded investors to plow $90 million into his vegan food startup Hampton Creek Inc. Tetrick had impressed leading Silicon Valley venture capital firms by getting his eggless Just Mayo product into Walmart, Kroger, Safeway, and other top U.S. supermarkets within about three years of starting his company.

What Tetrick and his team neglected to mention is that the startup undertook a large-scale operation to buy back its own mayo, which made the product appear more popular than it really was. At least eight months before the funding round closed, Hampton Creek executives quietly launched a campaign to purchase mass quantities of Just Mayo from stores, according to five former workers and more than 250 receipts, expense reports, cash advances and e-mails reviewed by Bloomberg. In addition to buying up hundreds of jars of the product across the U.S., contractors were told to call store managers pretending they were customers and ask about Just Mayo. Strong demand for a product typically prompts retailers to order more and stock it in additional stores.

Wait is that legal? Well, technically it is not illegal, although it is extremely unethical (imagine if, gasp, Facebook was using click-farms to fabricate users - it's the same concept) however it undersco ...

Why Is High-Yield Energy Debt Decoupling From Oil?

Submitted by Rakesh Upadhyay via OilPrice.com,

The recent drop in crude oil prices has not reflected in the iShares iBoxx $ High Yield Corporate Bond ETF, as shown in the chart below. Various analysts believe that the close correlation between the junk bonds and crude oil - which have been together for quite some time - has now decoupled.

Is this relationship really over, or is this parting of ways only a temporary separation?

(Click to enlarge)

During the start of 2016, oil was falling into a seemingly bottomless pit—fears regarding the solvency of a number of companies pulled the prices of junk bonds down with it.

But between February and June, oil prices rallied to over $50 a barrel, and the high-yield bonds followed suit, refusing to be left behind.

The oil producers managed to survive the first-half of 2015 due to existing hedges, but during the second-half of the year, and in early 2016, expiring hedges and low crude oil prices took its toll and led to record bankruptcies.

However, the rally to $50 a barrel levels was a Godsend, and the oil producers have ramped up their hedges.

A Reuters analysis of disclosures reports that 17 of the 30 large U.S. shale producers have increased their hedges—the most since 2015.

"The producers have sold the hell out of this rally," said Stephen Schork, president of Schork Group Inc., a consulting firm ...

BustFeed: You Will Never Guess What Facebook Just Did To Its Clickbait Reducing Algo

It has already been a bad year for "new media" clickbait properties like BuzzFeed (which, ironically, deny they engage in clibkbait) which are entirely reliant on Facebook's news algorithms to distribute the vast majority of their content. Back in April, the FT reported that BuzzFeed missed its revenue target for 2015 and slashed its internal projections for 2016 by about half. It had projected $250 million in revenues for 2015 but generated less than $170 million, the FT reported and what's worse, had halved its internal revenue target for 2016 from $500 million to $250 million.

One can almost see why.

It's about to get worse, and we are not referring to the comments CNN president Jeff Zucker made in a Variety interview, in which he said "I don't think Vice and BuzzFeed are legitimate news organizations", instead calling the rival media outlets "native advertising shops" and saying CNN "crushes" them.

While he wasn't exactly wrong, CNN mocking other clickbait websites, and accusing them of not being a legitimate news organization is certainly surely amusing.

What Zucker does not get is that BuzzFeed (and Vice) provide just the content that most of Americans wants to "read" (by which we mean kill a few minutes of what wou ...

What Oil in the $40s Means for Oil Majors

For how long can Europe's big-five energy companies maintain dividend levels? Second-quarter results disappointed and the oil price fell about 20% in the past two months.

How Long Can Adidas Keep the Pace?

Adidas has started to narrow the gap with Nike in the crucial U.S. market, but its valuation looks stretched.

India's Tax Overhaul Shows Emerging Markets How to Rock

India's goods-and-services tax overhaul signals strong momentum in reforming the economy. That's bullish for Indian stocks.

FireEye plans layoffs as new CEO takes the helm, stock plunges

In his first major move since taking over the top spot for FireEye Inc., Chief Executive Kevin Mandia plans to cut hundreds of jobs and chop spending in several areas in order to find profit at a security firm where growth seems to be slowing down.

Market Snapshot: Stocks sputter to trade mostly flat ahead of jobs report

U.S. stocks relinquish modest gains to trade mostly flat Thursday as investors awaited the closely watched jobs report due Friday.

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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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