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09Jun2017 Market Update: Wall Street Retreats From Record Highs, DOW Down Double Digits, Apple Leads Abrupt Tech Selloff; Nasdaq Lower

Written by Gary

US stocks touched record highs in late morning trading as bank stocks rose (SPY +0.1%), U.S. wholesale inventories fell more steeply than the government had previously estimated, gold prices slid lower as the dollar regained some ground.


Here is the current market situation from CNN Money

North and South American markets are mixed today. The IPC is up 0.11% while the S&P 500 gains 0.06%. The Bovespa is off 0.10%.

Traders Corner - Health of the Market

Dow rises 78 points as investors look past UK election shocker, Comey testimony

What Is Moving the Markets

Here are the headlines moving the markets.

Bank stocks drive Wall St. to all-time highs

(Reuters) - U.S. stocks touched record highs in late morning trading on Friday as bank stocks rose, while investors shrugged off the surprise result of the British general election.

Johnson & Johnson expects to complete Actelion purchase on June 16

ZURICH (Reuters) - Johnson & Johnson said the approval of its proposed acquisition of Swiss biotech firm Actelion by the European Commission on Friday meant all regulatory approvals required to complete the $30 billion deal had now been received.

EU antitrust regulators to investigate $38 billion Qualcomm, NXP deal

BRUSSELS (Reuters) - EU antitrust authorities opened an investigation on Friday into Qualcomm's $38-billion bid for NXP Semiconductors , ratcheting up pressure on the U.S. smartphone chipmaker to offer concessions to address their concerns.

U.S. wholesale inventories post biggest drop in more than a year

WASHINGTON, June 9 (Reuters) - - U.S. wholesale inventories fell more steeply in April than the government had previously estimated, posting their biggest drop in more than a year as sales also fell sharply.

Toshiba unconvinced by Western Digital's last-ditch chip bid

TOKYO (Reuters) - Toshiba Corp said on Friday it wasn't convinced by an effort by Western Digital Corp CEO Steve Milligan to win the Japanese conglomerate's backing for the U.S. tech firm's bid for Toshiba's highly prized chip unit.

WTO largely backs Boeing in trade row, faults tax break

GENEVA (Reuters) - The World Trade Organization largely cleared the United States of maintaining unfair support for Boeing Co , but said it had failed to withdraw a tax break in its main planemaking state that continues to cause trade fireworks.

After oil drop, some OPEC delegates question if supply cut deal enough

LONDON (Reuters) - Two weeks after an OPEC-led deal to extend oil output cuts until March, some OPEC delegates are questioning whether the agreement will be enough to reduce a glut in supplies and lift prices.

Hong Kong, Singapore rivalry hobbling Asia in $100 billion fintech race: lobby group

HONG KONG (Reuters) - Asia's competitiveness in fintech is being undermined by the rivalry among the region's financial centers that has created regulatory complexity and uncertainty, a financial lobby group has warned.

U.S. trade body advances probe of dumping claims against Bombardier jets

WASHINGTON (Reuters) - The U.S. International Trade Commission on Friday gave a green light to the U.S. Commerce Department to begin preparing anti-dumping and anti-subsidy duties against new jets from Canada's Bombardier Inc based on claims by U.S. rival Boeing.

FANG Stocks Slammed After Goldman Warns Of "Valuation Air-Pocket"

Update: FANG Stocks are getting hammered today.

* * *

The fascination with the influence of a handful of giant tech stocks on the overall markets continued overnight, when one day after Bank of America found that the tech sector is now the "most overweight it has ever been", surpassing even the record clustering into tech during the dot com bubble, Goldman issued a report looking at the outsized influence of the five tech stocks in question which it dubs FAAMG - Facebook, Amazon, Apple, Microsoft and Alphabet, which have collectively added a total of $600 bn of market cap this year, "or the equivalent GDP of Hong Kong and South Africa combined."

This is also the group of names which we reported last month is what virtually every brand name hedge fund purchased in the first quarter based on 13F filings, as active managers abandoned "value" names and factors and rushed into "momentum" and "growth."

Looking at this cluster of tech names, Goldman's Robert Bouroujerdi writes that "while FANG has dominated investor focus, the nature of the acronym has expanded more broadly to ...

Awan Brothers Scandal Creates Fears About Scope Of Data Leak

Via Disobedient Media

Over the past few months, the story of the Awan brothers has been largely ignored by mainstream media. However, the brothers Abid, Imran, and Jamal Awan are at the center of a criminal investigation by U.S. Capital Hill Police. The Awan brothers were Pakistani IT specialists, whom worked for more than 30 house and senate democrats, as well as Rep. Debbie Wasserman Schultz. The substantial scandal has raised questions about who may have been passed data which the Awans had access to, given Pakistan's history of collaborating with a number of foreign countries who have demonstrated past willingness to influence U.S. politics.

Imran was first employed in 2004 by former Democrat Rep. Robert Wexler (FL) as an "information technology director", before he began working in Rep. Debbie Wasserman Schultz's office in 2005.

The family was paid extremely well, with Imran Awan being paid nearly $2 million working as an IT support staffer for House Democrats since ...

Destroying The Myth Of 'Cash On The Sidelines'

Authored by Lance Roberts via RealInvestmentAdvice.com,

With the markets breaking out to new highs, it is not surprising to see a continued stream of analysis grappling for bits of data to support the bullish mantra. As you know, I have increased equity allocations in models with the breakout, but this is a tactical position only as the fundamentals simply do not support the rising risk levels currently.

However, despite 8-years of a bull market advance, one of the prevailing myths that seeming will not die is that of "cash on the sidelines." To wit:

"Underpinning gains in both stocks and bonds is $5 trillion of capital that is sitting on the sidelines and serving as a reservoir for buying on weakness. This excess cash acts as a backstop for financial assets, both bonds and equities, because any correction is quickly reversed by investors deploying their excess cash to buy the dip," Nikolaos Panigirtzoglou, the managing director of global market strategy at JPMorgan, wrote in a client note.

This is the age old excuse why the current "bull market" rally is set to continue into the indefinite future. The ongoing belief is that at any moment investors are suddenly going to empty bank accounts and pour it into the markets. However, the reality is if they haven't done it by now after 3-consecutive rounds of Q.E. in the U.S., a 200% advance in the markets, and ongoing global Q.E., exactly what will that catalyst be?

However, Clifford Asness previously wrote:

What Theresa May's Drubbing Means for Brexit

Prime Minister Theresa May's tenuous grip on power following an embarrassing loss of seats in parliament severely dents her ability to lay down ultimatums in the Brexit talks.

Don't Be Fooled by Stock Market's Snap Reaction After U.K. Election

The U.K. election sent the globally oriented FTSE 100 index higher, just as the Brexit referendum did—but the smarter play may be the U.K.'s less loved domestic stocks.

U.K. Elections: Britain Is an Uncertainty-Generating Machine

The surprise U.K. election results show markets once again worrying about political risk in all the wrong places. Even worse, valuable time to reach a Brexit deal has been burned.

Capitol Report: Trump tosses binders of paperwork in pitch for simpler infrastructure rules

President Donald Trump concluded a week of infrastructure-themed events by theatrically dropping oversized binders to the ground at an event held at the Department of Transportation, saying lengthy regulations could be replaced by streamlined rules if his plans are approved.

Beer Goggles: MillerCoors, tapping into a hot market, finally makes a Mexican beer run

But first, the company faces some challenges with the Sol brand, says Jason Notte.

MarketWatch Update: We want your feedback: Take a sneak peek at upcoming changes to Virtual Stock Exchange

MarketWatch is rebuilding Virtual Stock Exchange — or VSE. It's a refresh of sorts for one of the best stock-market simulation games out there.

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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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