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28Jul2017 Market Update: DOW Makes New Highs While Wall Street Mostly Shows Red Ink, US Baker Count Up 8, Crude Prices Climb, US Dollar Falls

Written by Gary

The DOW wins the gold ring after opening setting, again, a new record high, while the other indexes fell into the red from the opening bell (SPY -0.2%). The other indexes ...


Here is the current market situation from CNN Money

North and South American markets are lower today with shares in Mexico off the most. The IPC is down 0.58% while U.S.'s S&P 500 is off 0.25% and Brazil's Bovespa is lower by 0.12%.

... slipped today as losses in Amazon and tobacco shares sent investors to safer havens. The gold index rose into the 1270 level, WTI crude steady in the high 49 handle and the US dollar index has slipped to the low 93's.

What Is Moving the Markets

Here are the headlines moving the markets.

Wall Street dragged lower by Amazon, tobacco stocks

(Reuters) - Wall Street slipped on Friday as losses in Amazon and tobacco shares weighed on major indexes.

U.S. economy speeds up in second-quarter, wages continue to lag

WASHINGTON (Reuters) - The U.S. economy accelerated in the second quarter as consumers ramped up spending and businesses invested more on equipment, but persistent sluggish wage gains cast a dark shadow over the growth outlook.

Kors needs to buckle down for Jimmy Choo deal to shine

(Reuters) - U.S. retailer Michael Kors is betting that its acquisition of storied shoemaker Jimmy Choo will give sales a much-needed boost, but lingering problems at Kors' core bag business could delay potential benefits.

Airlines' Atlantic pact guards against budget rivals and Brexit

BERLIN/NEW YORK (Reuters) - A transatlantic alliance between three global airlines will shore up their position in the lucrative UK-U.S. market, shielding them from low-cost rivals and the uncertainties of Britain's exit from the European Union.

Google, Facebook show power of ad duopoly as rivals stumble

SAN FRANCISCO (Reuters) - Quarterly results from Alphabet Inc and Facebook Inc provided fresh evidence this week that the digital advertising market is effectively a duopoly, a dynamic with deep implications for two of Silicon Valley's titans.

New York City Comptroller Stringer calls for new chairman at Wells Fargo

BOSTON (Reuters) - New York City Comptroller Scott Stringer on Friday called on Wells Fargo & Co to replace its chairman Stephen Sanger after the bank said customers were wrongly charged for auto loan insurance.

Deutsche Boerse's Kengeter in close contact with LSE in run-up to merger talks: Der Spiegel

FRANKFURT (Reuters) - Deutsche Boerse's Chief Executive Carsten Kengeter, who is under investigation for insider trading, frequently met and spoke by telephone with his London Stock Exchange counterpart in the months before they announced official merger talks, Der Spiegel magazine reported on Friday.

Amazon's big profit miss spooks investors, but analysts stay bullish

(Reuters) - A steeper-than-expected drop in quarterly profit rattled some Amazon.com investors, but Wall Street analysts remained largely bullish about the company's aggressive spending plans.

Wall Street braces for end of Snap share lockup

SAN FRANCISCO (Reuters) - A flood of Snap Inc shares held back since the Snapchat owner's initial public offering could start to trade freely next week, pressuring a stock that has already plunged far below its debut price.

Rig Count Rises By Just 2 As Goldman Expects Oil Market To Rebalance By Early 2018

With WTI heading for its best week since 2016, demand and inventory data is trumping production for now and today's Baker Hughes rig count data did nothing to change that as, following last week's 1 rig drop, producers only added 2 oil rigs in the last week to 766.


*U.S. OIL RIG COUNT UP 2 TO 766 , BAKER HUGHES SAYS :BHGE US

Judging by the lagged correlation to WTI, rig counts are stalling as expected...

US (Lower 48) crude production continues to rise with lagged rig count data...topping 9mm barrels last week for the first time since July 2015...

WTI, Brent poised for largest weekly gains in 7 months amid indications that market is rebalancing...

"There's less crude oil," Bob Yawger, director of the futures division at Mizuho Securities USA, says. "That's all there is to it"

And as

Desperate Americans Are Saving The Least Since The Start Of The Last Two Recessions

The last two times Americans were saving this little in order to maintain their lifetsyles, the US economy was in recession.

According to newly revised government data, Bloomberg reports that American households scaled back their pace of savings to the lowest level in nine years at the end of 2016 as the growth of their wages and salaries slowed.

The personal savings rate was 3.6% in the fourth quarter of 2016, down from a previously published 4.9%, according to somewhat dramatic annual revisions to gross domestic product and related data, released Friday by the Commerce Department. That's the lowest reading since a 2.8% rate in the final three months of 2007, just as the U.S. was entering a recession.

The saving rate recovered somewhat in the first three months of the year, to 3.9% after a previously reported 5.1% . In the second quarter, it was little changed at 3.8%.

The lower fourth-quarter rate was one of the bigger changes in the government's annual update of GDP, and paints a quite different picture from the "recovery" images put forward by the Obama administration.

Instead of recovery, as Bloomberg notes, the figures suggest that consumers were saving less to maintain their spending entering 2017. That's significant because consumption accounts for more than two-thirds of gross domestic product, and the revisions may help explain some of the slowdown in first-quarter purchases.

Have You a Positive Personal Practice? (Part Two)

Have You a Positive Personal Practice? (Part Two)

By

Cognitive Dissonance

My apologies for how tardy Part Two of this article is. It is now mid summer and the garden has begun to produce prolifically. Which means we have begun to can almost as prolifically. Plus I have taken on several outside jobs for friends of several week's duration to put some fiat in the wallet and this has taken some precedence over my writing.

This theme (Positive Personal Practice) has expanded into at least three parts and maybe more. I don't plan out my writing, but rather let it flow where it wants to go. Sometimes it goes further than I expect and this is one of those cases.

In addition, this iteration appears a bit more lumpy than usual. I blame it on Mrs. Cog, who introduced me to lumps in my mashed potatoes. After great protestation on my part (mashed potatoes are by definition mashed) to my surprise I found I like them. My writing seems to like them too.

That's my story and I'm sticking to it. ;-)

Cognitive Dissonance

The first step to returning to health is to acknowledge you are sick. The second step to getting better is to treat the cause and not the symptoms. Only the insane or someone who doesn't actually recognize their illness or symptoms as a problem might argue with the above supposition.

In other words, if something is perceived as normal and natural, there ain't nothing to fix. And mama always told me not to fix what ain't broken. Perfectly reasonable, wouldn't you say?

Of course, if everyone is ill (or insane) than 'normal' is simply what the majority are doing at that precise moment in space and time. ...

Internal Cracks Are Showing In The Market - Low Volume Highs

Via Dana Lyons Tumblr,

Stocks have recently witnessed an unprecedented cluster of new highs occurring on negative volume.

A number of stock bears have pointed to the supposed thin nature of the rally in justifying their skepticism. That is, the rally has been led by a relatively small number of stocks as opposed to broad participation. While we have seen anecdotes of such a condition, we can't say that we fully subscribe to this concern. Factors such as the NYSE advance-decline line hitting new highs along with the various market cap indices, from small-caps to large-caps, also at new highs undermine the argument, in our view.

We will say that some of our proprietary breadth measures have not supported the recent rally. When such divergences have occurred in the past, stocks have eventually dropped, confirming the signals of our indicators. However, the timing of such a reckoning can be difficult. Outside of that condition, as we said, concerns about breadth have been mainly of an anecdotal nature.

Today's Chart Of The Day is also best classified in the anecdotal category, though perhaps a little more alarming than some of the recent "warnings" that we've seen. It deals with a recent odd spate of new 52-week highs in the S&P 500 on days in which declining volume on the NYSE actually exceeded that of advancing volume. There have actually been 6 such new highs in the past 3 months.

If that doesn't seem like a big deal, it is actually a record number of such days within a 3-month time period. In fact, it is double the previous record number of 3.

...

The Great Transatlantic Bond Divergence Unwind

For more than two decades after the fall of the Berlin Wall, U.S. and German bonds were like soldiers marching in step. That changed a few years ago, but signs are for this important trade to reassert itself.

More of the Same Ain't So Bad for Economy

GDP growth brings the average for the first half to 1.9% which, while far from exciting, is par for the course and leaves the economy far from recession.

Europe's Investment Banks Suffer American Envy

Across the board, most European banks' revenues are falling further behind.

Advance Estimate 2Q2017 GDP Quarter-over-Quarter Growth at 2.6 Percent.

Written by Steven Hansen

The advance estimate of first quarter 2017 Real Gross Domestic Product (GDP) is a positive 2.6 %. This growth is better than the previous quarter's downwardly revised 1.2 % if one looks at quarter-over-quarter headline growth.Year-over-year growth improved modestly so one could say economic growth was better.

Outside the Box: Why the SEC's crackdown could be good for initial coin offerings

More 'legitimate' token offerings might thrive, says Lucas Geiger.

Capitol Report: Where health-care reform goes after failure to repeal and replace Obamacare

Democrats and Republicans are each saying they still want to improve the health-care system in the wake of the GOP's failed effort to repeal and replace Obamacare, but a piece-by-piece strategy appears much more likely than a sweeping reform.

London Markets: FTSE 100 closes sharply lower in tobacco-led stock rout

U.K. stocks tumble Friday, with shares of British American Tobacco and Imperial Brands hit hard after a U.S. regulatory decision about the tobacco industry.

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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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