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01May2017 Market Update: Trump Considering Breaking Up Big Banks Waterfalls DOW 14 Points, ISM Manufacturing Index Slipped To 54.8

Written by Gary

Stock market edged higher at the opening, buoyed by Apple, technology shares, the Dow industrials slipped into the red, down 14 points before climbing back to only down 8 points. President Trump said he is considering breaking up big banks which sent the markets lower.

Here is the current market situation from CNN Money

North and South American markets are mixed today. The Bovespa is up 1.12% while the S&P 500 gains 0.25%. The IPC is off 0.36%.

Traders Corner - Health of the Market

Index Description Current Value Members Sentiment: % Bullish (the balance is Bearish) 73%
CNN's Fear & Greed Index Above 50 = greed, below 50 = fear


Investors Intelligence sets the breath Above 50 bullish

66% Overbought / Oversold Index ($NYMO) anything below -30 / -40 is a concern of going deeper. Oversold conditions on the NYSE McClellan Oscillator usually bounce back at anything over -50 and reverse after reaching +40 oversold. +8.65 NYSE % of stocks above 200 DMA Index ($OEXA200R) $NYA200R chart below is the percentage of stocks above the 200 DMA and is always a good statistic to follow. It can depict a trend of declining equities which is always troubling, especially when it drops below 60% - 55%. Following a major market correction, the conditions for safe re-entry are when:
a) Daily $OEXA200R rises above 65%
Secondary Bullish Indicators:
a) RSI is POSITIVE (above 50)
b) Slow STO is POSITIVE (black line above red line)
c) MACD is POSITIVE (black line above red line)
81% NYSE Bullish Percent Index ($BPNYA) Next stop down is ~57, then ~44, below that is where we will most likely see the markets crash. 68% S&P 500 Bullish Percent Index ($BPSPX) In support zone and rising. ~62, ~57, ~45 at which the markets are in a full-blown correction. 74% 10 Year Treasury Note Yield Index ($TNX) ten year note index value 23.25 Consumer Discretionary ETF (XLY) As long as the consumer discretionary holds above [66.88], all things being equal, it is a good sign for stocks and the U.S. economy 90.17 NYSE Composite (Liquidity) Index ($NYA) Markets move inverse to institutional selling and this NYA Index is followed by Institutional Investors 11,550

Stocks drop after Trump says he's actively considering breaking up big banks

Looking at the last three columns (below), the first one (Actual), is what was reported this morning. The second column (Forecast) is what analysts had forecast and the third column is the previous report. Full calendar HERE.

What Is Moving the Markets

Here are the headlines moving the markets.

U.S. factory activity slows; inflation pressures subside

WASHINGTON (Reuters) - U.S. factory activity slowed in April while consumer spending was unchanged in March and a key inflation measure recorded its first monthly drop since 2001, but economists still expect an interest rate increase in June as the labor market tightens.

Wall Street moves higher as tech gains offset weak economic data

(Reuters) - Wall Street was higher in late morning trading on Monday as gains in technology stocks, led by Apple, more than offset weak economic data and pushed the Nasdaq to another record high.

Mnuchin sees U.S. growth reaching 3 percent in time, tax cuts to help

BEVERLY HILLS (Reuters) - U.S. Treasury Secretary Steven Mnuchin said on Monday that economic growth of three percent is achievable in the next two years as the Trump administration sets out to dramatically cut taxes.

Dish revenue misses estimates, loses more subscribers than expected

(Reuters) - Dish Network Corp's quarterly revenue missed analysts' estimates as the U.S. satellite TV provider lost more pay-TV subscribers than expected.

Exclusive: Blackstone's GSO snaps up J. Crew debt in restructuring gambit

NEW YORK (Reuters) - GSO Capital Partners, private equity firm Blackstone Group LP's credit arm, is acquiring more of J. Crew Group Inc's debt, hoping for a profitable trade that could also give the U.S. fashion retailer more time to stave off bankruptcy, people familiar with the matter said.

Global stocks climb in light May Day trading; oil slips

NEW YORK (Reuters) - Apple shares hit a record high on Monday, lifting U.S. stocks and a gauge of key world equity indexes, while data on U.S. drilling and output kept downward pressure on oil prices.

Trump could target 'carried interest' tax loophole: official

WASHINGTON (Reuters) - The Trump administration's push to overhaul tax laws might soon target a loophole used by some financial managers to lower their tax rates, White House Chief of Staff Reince Priebus said on Sunday.

Target slashes CEO pay package after bleak year

(Reuters) - Target Corp's Chief Executive Brian Cornell took a sharp cut in compensation after the company failed to meet financial goals in a year marred by declines in sales and share price.

UBS, BNP, RBS get subpoenas in U.S. treasuries probe: Bloomberg

(Reuters) - U.S. federal prosecutors have subpoenaed several banks as part of a criminal investigation into possible manipulation of the U.S. Treasuries market, Bloomberg reported on Monday.

Trump Says "Would Be Honored" To Meet With Kim Jong-Un, Willing To Raise Gasoline Tax

In a surprising foreign policy pivot, President Trump told Bloomberg during an Oval Office interview that he would meet with North Korean leader Kim Jong Un "if the circumstances were right."

"If it would be appropriate for me to meet with him, I would absolutely, I would be honored to do it," Trump said Monday in an interview with Bloomberg News. "If it's under the, again, under the right circumstances. But I would do that." It was not immediately clear what circumstances Trump considers "right."

The US president added that "most political people would never say that," regarding his willingness to meet with the reclusive Kim, "but I'm telling you under the right circumstances I would meet with him. We have breaking news."

Kim's regime, a source of heightened geopolitical tension over the past month, has repeatedly defied the US and international sanctions with continued development of its nuclear and intercontinental ballistic missile program. It would mark the North Korean leader's first summit: as Bloomberg adds, Kim has never met with a foreign leader since taking charge after his father's death in 2011 and hasn't left his isolated country.

In January, Trump vowed that he wouldn't let North Korea develop a nuclear weapon capable of reaching the U.S. mainland, and North Korea has labeled American military moves in the region as acts of "intimidation and blackmail." North Korea has continued to test missiles this year, and last weekend the communist country arrested a third US citizen.

30Y Treasury Yield Bursts Above 3.00% After Mnuchin Comments

Following comments by Treasury Secretary Mnuch this morning that ultra-long bonds could "absolutely" make sense for America, the Treasury curve has jumped and steepened dramatically...

With 30Y yields back above the 3.00% Maginot Line.

Following the biggest short-squeeze in history... In fact the stunning swing in sentiment in the last 8 weeks (with almost $62 billion in 10Y Treasury shorts dumped) is shocking to see, smashing Speculative Positioning from its shortest ever to its longest in over 9 years...

It is perhaps not entirely surprising that sell-offs are a little more aggressive than normal.

Why Democrats Are Delighted With The Republican Spending Bill

Why were Democrats unable to hide their enthusiasm for the latest Omnibus spending bill proposed by House Republicans? Simple: because, as the Washington Examiner's Philip Klein writes, "Dems basically got everything. It's like they control House, Senate, & WH rather than the other way around."

Dems basically got everything. It's like they control House, Senate, & WH rather than the other way around.

— Philip Klein (@philipaklein) May 1, 2017

Some big picture details:

Deal totals just over $1 trillion

Deal allows for an increase of $12.5bn in defense spending, which is 18bn less than Trump requested. However, if Trump makes strides with Isis, an addition 2.5bn will be made available.

Includes permanent fix to fund coal miners' health care instead of a temporary extension.

Democrats win: There will be no wall funding; instead Trump will get $1.5bn in border security funds, which is half the original request; it will be used to support existing infrastructure.

Democrats win again: Puerto Rico will receive an emergency injection for Medicaid health insurance supports

Democrats win again2: Planned Parenthood, a key issue for Democrats, will be saved from cuts, while the National Institute of Health will see a $2bn hike in funding.

Democrats win again3: Cuts in the Environmental Protection Agency appear avoided for the remainder of the year.

Democrats win again4: The omnibus funds California high speed rail

Additionally as

RBOB "In Danger Of Breaking Down" Amid Record Gasoline Contango

June 2017 gasoline futures are traded at the biggest discount ever to the July contract this morning...

As the front-month futures tumbles to its lowest since September.

As Bloomberg reports, Mizuho Securities' Bob Yawger warns its "not a good sign that gasoline is so weak, so close to Memorial Day and driving season... gasoline in danger of breakdown today."

China Looks to Export Auto Overcapacity on Slow-Growth World

China makes too many cars and wants to make even more. Auto makers everywhere should worry about the spillover effects.

Sony Finds Success in All the Right Places

Sony reported strong results Friday but what should excite investors are the rosy forecasts for the future.

Economy Needs Consumers to Shop Again

First-quarter slowdowns have become such a regular feature of the U.S. economy that investors will be tempted to brush off this last one. They shouldn't.

March 2017 Construction Spending Growth Slows

Written by Steven Hansen

The headlines say construction spending was down and below expectations. I consider this a weaker report than last month but the year-over-year growth is about average seen since the end of the Great Recession..

Deep Dive: Four stocks that would get an immediate boost from Trump's tax reform

Erick Ormsby of Alcosta Capital Management says the companies are already improving earnings.

Your mom deserves better: 5 truly awful Mother's Day gifts

Why mom deserves more than just another bouquet.

This technology could kill passwords and even fingerprint sensors

How you type and scroll could soon be key to unlocking your device.

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