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02Aug2017 Market Update: Wall Street Retreats After Apple Pushes Dow Over 22 K, Crude Extends Gains As U.S. Crude Supplies Fall Less Than Forecast, US Dollar Trends Downward, Analysts Warn Of A Serious Bubble In Bonds, Not Stocks

Written by Gary

Major US stock indexes are largely off in early afternoon trading with only the Dow clinging to a small gain (DOW + 20 points)(SPY -0.3%). The DOW Industrials ...

Here is the current market situation from CNN Money

North and South American markets are mixed today. The Bovespa is up 0.88% while the IPC gains 0.08%. The S&P 500 is off 0.26%.

... gaped higher at the opening and withing minutes climbed above the 22,000 mark for the first time ever, helped by a rally in Apple's shares.

Oil prices fell to the lowest level of the session on Wednesday, after data from the U.S. Energy Information Administration showed domestic crude supplies fell less than expected last week.

What Is Moving the Markets

Here are the headlines moving the markets.

Wall Street pares gains sharply after Dow hits 22,000 mark

(Reuters) - The Dow breached the 22,000 mark briefly in early trading on Wednesday, powered by Apple's stellar results, before stocks retreated sharply across sectors as investors locked in gains.

Exclusive: N.Y. regulator subpoenas Wells Fargo over unwanted auto insurance

NEW YORK (Reuters) - New York state's banking and insurance regulator issued subpoenas on Tuesday to two Wells Fargo & Co units after the bank said it had sold auto insurance to hundreds of thousands of customers who did not need it.

Exclusive: Sanctions gap lets Western firms tap Russian frontier oil

OSLO/MOSCOW (Reuters) - A gap in U.S. sanctions allows Western companies to help Russia develop some of its most technically challenging oil reserves, and risks undermining the broad aim of the measures, a Reuters review of company results and media releases has found.

Exclusive: Blackstone in talks to sell stake in camera maker Leica - sources

FRANKFURT (Reuters) - Buyout group Blackstone is in talks with potential buyers for its 45 percent stake in iconic high-end camera and sport optics maker Leica, people close to the matter said.

Apple hits record high, powers Dow past 22,000

(Reuters) - Apple Inc's surprisingly strong quarterly results and forecast pushed the iPhone maker's shares to a record high, helping the Dow Jones Industrial Average breach the 22,000 mark for the first time ever.

Exclusive: Hasbro ends talks to buy entertainment company Lionsgate - sources

NEW YORK (Reuters) - U.S. toy company Hasbro Inc , maker of games ranging from Monopoly to foam Nerf balls, has ended talks to acquire U.S. movie studio and entertainment firm Lionsgate Entertainment Corp , people familiar with the matter told Reuters on Wednesday.

'Wonder Woman' helps Time Warner beat estimates as ad sales dip

(Reuters) - Time Warner Inc reported higher-than-expected quarterly profit on Wednesday as revenue from box office hit "Wonder Woman" helped offset declining ad revenue.

Mondelez appoints Dirk Van de Put to succeed Irene Rosenfeld as CEO

(Reuters) - Oreo cookies maker Mondelez International Inc said it appointed Dirk Van de Put, the chief executive of Canadian frozen foods maker McCain Foods, to take over the top job from Irene Rosenfeld.

Express Scripts wins dismissal of lawsuit over Anthem ties

NEW YORK (Reuters) - A federal judge has dismissed a lawsuit in which Express Scripts Holding Co shareholders accused the pharmacy benefits manager of inflating its share price by hiding its deteriorating relationship with its largest customer, Anthem Inc .

In Warning To North Korea, US Releases Video Of Overnight Minuteman ICBM Launch

As previewed last night, at 2:10am PT, the U.S. military successfully test-launched an unarmed Intercontinental Ballistic Missile from Vandenberg Air Force Base in California, about 130 miles northwest of Los Angeles, and just days after North Korea's second test of an ICBM. An Air Force statement said that the test was not a response to recent North Korean actions, but shows that America's nuclear enterprise is "safe, secure, effective and ready to be able to deter, detect and defend against attacks on the United States and its allies."

The launch is said to "validate and verify the effectiveness, readiness, and accuracy of the weapon system," according to Colonel Michael Hough, commander of Air Force Global Strike Command's 30th Air Wing.

"Team V is postured to work with Air Force Global Strike Command to test launch the Minuteman III missile," Hough said in a statement. "Our long history in partnering with the men and women of the 576th Flight Test Squadron shows that the Western Range stands ready and able to create a safe launch environment."

The ICBM was equipped with a test reentry vehicle - just like the previous three launches in 2017 - which officials said showed it traveled about 4,200 miles to the Kwajalein Atoll in the Marshall Islands. The operation was conducted by a team of Air Force Global Strike Command Airmen from the 90th Missile Wing, along with the 576th Flight Test Squadron and the 30th Space Wing stationed at Vandenberg.

This is the fourth Minuteman ICBM launched from the Vandenberg base this year. The first 2017 test took place in February, involving a Minuteman III that traveled to the Marshall Islands, carrying a non-explosive warhead. Another test was conducted by the Air Force on April 26. Days later, a third test missile launched from Vandenberg base.

Air ...

Trump's Mistake: McCain Now Most Powerful Man in D.C. - It's Personal Now

McCare: Payback is a Bitch, Donald

Written By Brian Brady for MarketSlant

[Comment: Brian is a GOP Voice in the California Wilderness - Vince Lanci]

Question: Who is the most powerful man in the health insurance debate?
Answer: Senator John McCain

Question: Why Didn't McCain Vote For a Repeal ?
Answer: Some moron said "I like people who weren't captured".

Politics is personal. You might LIKE that Trump is your Uncle Gus but the tenured political faculty doesn't and McCain is Professor Emeritus Maverikus of the tenured political faculty. McCain didn't think Trump was qualified to be President, Trump insulted the crap out of him, and McCain is not going to hand him a political victory. The personal bonus from McCain's defection? John McCain is the most powerful man in Washington now.

Here are three reasons why the "repeal and replace" will have McCain's fingerprints all over it:

1-McCain has a sense of urgency

John McCain's health problems make it likely that he won't serve more than a year or two. McCain, for all of his detractors on the right and left, is still respected by his colleagues. If ANYONE can broker a deal with Democratic support, it's John McCain. The American people are impatient and a mid-term election is 15 months away but McCain has to GSD. He will invoke his illness, if he deems it necessary, to get both sides to the table. Does this make your blood boil? It ...

"Risk Of Meaningful Decline": The TBAC's Disturbing Normalization Slides

As part of the Treasury's Q3 refunding announcement, which as discussed earlier sent 30Y yields to session lows after it failed to either boost upcoming debt issuance or mention ultra-long dated bonds, the Treasury Borrowing Advisory Committee or TBAC, a select group of bankers from Wall Street's biggest firms tasked with providing periodic guidance to the Treasury, released its latest presentation, whose topic this quarter was "Normalization of SOMA Portfolio", or a breakdown of i) how Wall Street expects the Fed's balance sheet reduction will play out from a chronological and structural basis, ii) how treasury issuance will be impacted as a result, and most importantly, iii) the expected impacts on markets.

The full agenda was as follows:

1. Expectations for balance sheet normalization

When will Fed start phasing out Treasury holdings?

What will be the size of Treasury holdings once the Fed balance sheet is normalized?

2. How will the Fed distribute eventual Treasury purchases across maturities?

Expectations for resulting Treasury issuance

How large will Treasury's financing needs be? When should Treasury start increasing auction sizes?

What will be the impact on auction stop-out rates?

What is the recommended distribution across tenors for higher financing needs?

3. Market implications of balance sheet normalization

Will SOMA redemptions have disruptive secondary market impacts?

What will be the impact on financial markets overall including risk assets?

How will the repo market be impacted?

On topic one, the key highlights were the following expectations:

The FOMC will announce a pha ...

Thank the Foreigners for Dow 22000

Americans cheering the U.S. stock market's latest milestone should pause to thank the rest of the world for making it possible.

Airline Dealmaking Won't Cure Europe's Profit Problem

Restructuring at Alitalia and Air Berlin and a revamped trans-Atlantic alliance are helpful but not transformative for the European airline industry.

Rio Tinto Can't Just Mine The Current Rich Vein Forever

Rio Tinto's results were impressive, but the current favorable environment won't last forever.

Burger King parent says Nutella items were a miss, but jumbo burgers hit the spot

Burger King parent Restaurant Brands International said Tim Hortons same-store sales suffered after customers didn't bite into Nutella baked goods.

Herbalife shares slide 4% as analysts fret about impact of new FTC rules on sales

The weight-management and nutrition company beat profit estimates for the second quarter, and raised guidance for the year.

Trump Today: Trump Today: President boasts about his 'great company' and deal-making skills as he grudgingly signs Russia sanctions bill

President Donald Trump signed what he called a "significantly flawed" bill on Wednesday to impose sanctions on Russia, and also boasted about his business empire as he said he could make better deals with other nations than Congress can.

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