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07Aug2017 Market Update: Wall Street's Trump Rally Going Strong After Eight Previous Consecutive Sessions, US Crude Was Last At $49.16 A Barrel, Gold Index Jumps To The 1264 Level, Analysts Warn Of A Coming Correction

Written by Gary

US stock markets have been trending upwards from the opening bell. The DOW has set another new record in late afternoon trading (22,121.15) and may do so again before the closing.


Here is the current market situation from CNN Money

North and South American markets are broadly higher today with shares in Brazil leading the region. The Bovespa is up 1.30% while Mexico's IPC is up 0.12% and U.S.'s S&P 500 is up 0.09%.

What Is Moving the Markets

Here are the headlines moving the markets.

Dow tracks ninth straight day of record close

(Reuters) - U.S. stocks were slightly up in early afternoon trading on Monday, with the Dow on track to close at a record high for the ninth straight day, after squeezing out another all-time high just after the open.

Tesla seeks $1.5 billion junk bonds issue to fund Model 3 production

DETROIT (Reuters) - Tesla Inc said on Monday it would raise about $1.5 billion through its first-ever high-yield junk bond offering, as the U.S. luxury electric car maker seeks fresh sources of cash to ramp up production of its new Model 3 sedan.

Samsung scion Lee fights back tears as prosecutors seek 12 years' jail

SEOUL (Reuters) - Samsung Electronics Vice Chairman Jay Y. Lee fought back tears and denied wrongdoing on Monday as prosecutors sought a 12-year jail term on charges that include bribing the former president to help cement control of the South Korean tech giant.

Funds target 'unknown' stocks as Wall Street cuts analyst jobs

NEW YORK (Reuters) - With a nearly 30-percent gain in 2017, shares of industrial products maker Handy & Harman Ltd are outpacing hot stocks like Google-parent Alphabet Inc and Visa Inc . Yet few on Wall Street have ever heard of the $412-million market-cap company, in large part because no sell-side research analysts publish any estimates of its earnings.

Tyson posts better-than-expected profit, bets on chicken

(Reuters) - Tyson Foods Inc reported stronger-than-expected quarterly results on Monday, sending its shares up 5 percent, and said it would ramp up chicken production in the face of record demand from U.S. consumers.

Netflix buys comic book publisher run by 'modern-day Stan Lee'

(Reuters) - U.S. video streaming company Netflix Inc said on Monday it bought comic book publisher Millarworld, home to titles such as "Kick-Ass" and "Kingsman," in its first ever acquisition.

Toshiba may gain auditor sign-off, reducing delisting risk: media

TOKYO (Reuters) - Toshiba Corp may gain a partial endorsement from its auditor for its annual financial results after disagreements over accounting for the much of the year, Japanese media reported - a step that would lessen, but not remove, the risk of a delisting.

Marriott set to woo Chinese tourists with Alibaba deal

(Reuters) - Marriott International Inc said on Monday it would partner with China's Alibaba Group Holding Ltd to tap into the growing number of Chinese citizens who travel abroad.

Higher-cost crude could squeeze margins at U.S. refiners

HOUSTON (Reuters) - U.S. refiners could face a continued squeeze on profit margins in the months ahead as dwindling supplies of heavy crude from Venezuela and elsewhere are leading several to switch to higher-priced but easier-to-refine light, sweet crude.

"That's The Wrong Way To Go" - Robert Shiller Slams America's "Excessive Lust For Wealth"

Authored by Robert Shiller, originally posted op-ed at The New York Times,

The Transformation of the 'American Dream'

"The American Dream is back." President Trump made that claim in a speech in January.

They are ringing words, but what do they mean? Language is important, but it can be slippery. Consider that the phrase, the American Dream, has changed radically through the years.

Mr. Trump and Ben Carson, the secretary of housing and urban development, have suggested it involves owning a beautiful home and a roaring business, but it wasn't always so.

Instead, in the 1930s, it meant freedom, mutual respect and equality of opportunity.

It had more to do with morality than material success.

This drift in meaning is significant, because the American Dream - and international variants like the Australian Dream, Le Rêve Français and others - represents core values. In the United States, these values affect major government decisions on housing, regulation and mortgage guarantees, and millions of private choices regarding whether to start a business, buy an ostentatious home or rent an apa ...

Cafe Brags That They Discriminate Against Men

Via The Daily Bell

As a business, if you want to promote equality, the first thing you need to do is make sure you treat your customers unequally based on their gender.

I love when people empower themselves by becoming business owners. Running a business is certainly not easy, but it still frees you from certain constraints. For instance, pay is not decided arbitrarily by a boss, it is based on the services you provide.

Ironically, one business owner in Australia is using her success to promote inequality.

The cafe in Australia touts their discriminatory practices. An article about the cafe on The Mirror reads:

Repsol, Statoil Pull Foreign Oil Workers From Venezuela

One day after Venezuela allegedly squashed a "military rebellion", in anticipation of further political and social turmoil in the socialist nation, energy giant Repsol SA pulled all foreign workers from its fields in Venezuela, Bloomberg reports adding that Norway's Statoil ASA also removed all expat staff.

According to Bloomberg, Repsol field workers left the country in the past few weeks, with a skeleton expatriate staff remaining at the company's offices in Caracas. Separately, Statoil withdrew its last three foreign workers before the July 30 election to ensure their safety, Erik Haaland, a company spokesman, told Bloomberg by phone.

The immediate result of the departures will be an even bigger decline in Venezuela's oil output - the only remaining asset which Maduro can readily exchange for dollars - further exacerbating the country's financial crisis as the inflow of hard currency slows further.

The departure of workers will be a concern to the government because oil output, which has tumbled over the past two years, accounts for 95 percent of Venezuela's foreign-currency earnings. Repsol gets about 10% of its production from the country, where it owns a stake in the Carabobo heavy-oil field. The Spanish company also is a partner in the Perla project, Latin America's largest offshore gas deposit, together with Eni SpA.

A spokesman for Rome-based Eni said the company is keeping only essential expatriate personnel in the country. It isn't currently considering an evacuation but continues to monitor the situation, he said.

In what some may consider employee discrimination, Repsol said it still has Venezuelan citizens working at its operations without spe ...

Elevated 2018 Estimates Widen Gap Between GAAP & Non-GAAP Earnings

Via Hedgopia.com,

As of last Thursday, a little over four-fifths of S&P 500 companies reported 2Q17 results. Of the 422 companies, 70.1 percent beat on operating earnings, 20.6 percent missed and 9.2 percent met, as per S&P Dow Jones Indices.

In the latest week (through Thursday), 2Q17 estimates went up by $0.33 week-over-week to $31.03. When the quarter came to an end, estimates were $30.97. Going back many quarters, actual earnings have come in lower than expected at the time of the quarter-end. From this perspective, the hitherto 2Q17 trend is an improvement, although one-fifth are yet to report.

The increase in 2Q17 estimates also helped push up 2017 estimates by $0.13, to $127.64, even as 2018 went down by $0.40 to $144.77. More important perhaps is the revision trend, which is down.

In January last year, 2017 was expected to come in at $141.11. In January this year, 2018 estimates were $147.21 (Chart 1).

The downward trend in 2017/2018 estimates is nothing new, considering how 2015 and 2016 fared. In both those years, actual operating earnings were substantially less than the sell-side's original estimates.

As things stand, 2018 expectations look way elevated.

There is a tight correlation between GDP and corporate profits.

U.S. corporate profits adjusted for inventory valuation and capital consumption peaked at $2.23 trillion in 4Q14, with 1Q17 at $2.11 ...

Cash-Hungry Tesla's Missed Opportunity

Tesla chief Elon Musk's choice of debt to finance his Model 3, while the company's share price is so strong, may turn out to be a mistake.

China Gives Up Global Role for a Stronger Yuan

Rebounding trade and tighter capital controls have shored up China's currency against the dollar and replenished the nation's foreign exchange coffers. But the yuan's internationalization has stalled.

NXP Investors Can Expect More Qualcomm Love

Qualcomm looks like it will have to up its $38 billion bid for Dutch car-chip giant NXP if it wants achieve its goal of getting a slice of the automotive future.

July 2017 Conference Board Employment Index Growth Rate Accelerates

Written by Steven Hansen

The Conference Board's Employment Trends Index - which forecasts employment for the next 6 months improved with the author's saying "the rapid improvement in the index continued, suggesting solid hiring and further tightening of the labor market in the months ahead".

Futures Movers: Oil prices slide as investors await news from OPEC meeting

A two-day gathering in Abu Dhabi, United Arab Emirates will discuss members' compliance level to the output pact the cartel signed with 10 other oil suppliers, including Russia, in late 2016

The Tell: Why is bitcoin surging? Ask 'Spoofy,' the trader who's reportedly manipulating prices

Bitcoin caught fire this weekend, taking out yet another record high and pushing above $50 billion in market capitalization for the first time ever. This after selling off in the wake of the split last week. Signs point to a mystery trader.

Teva's stock has tumbled over 8 sessions and Morgan Stanley says it could fall 16% more

Teva's corporate troubles have been exacerbated by wider generic drug industry challenges.

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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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