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17Aug2017 Market Close: Wall Street Has Taken A Nose Dive, DOW Down 274 Points, WTI Crude Settles In The Low 47 Handle, Some Analysts Believe Trump Is The Problem

Written by Gary

US stock markets sold off today (SPY -1.6%), with the S&P 500 hitting its lowest level in a month. The real cause is the coming spectacular eclipse that will allow market bears to sneak out and eat any bulls they find.

Todays S&P 500 Chart

The Market in Perspective

Here are the headlines moving the markets.

Wall Street sells off as Washington worries rise

(Reuters) - U.S stocks sold off on Thursday, with the S&P 500 hitting its lowest level in a month, as escalating worries about the Trump administration's ability to push through its agenda rattled investors.

U.S. labor market tightening; autos weigh on manufacturing

WASHINGTON (Reuters) - The number of Americans filing for unemployment benefits fell to near a six-month low last week, pointing to a further tightening in the labor market that could encourage the Federal Reserve to lay out a plan to start unwinding its massive bond portfolio.

Exclusive: SEC officials' holdings, legal work, pose potential conflicts

WASHINGTON (Reuters) - Two lawyers appointed to senior jobs at the U.S. Securities and Exchange Commission have ties to major companies including financial firms Goldman Sachs Group Inc and Wells Fargo & Co that could complicate efforts to regulate them, according to government documents viewed by Reuters.

Wisconsin debates billions in incentives for Foxconn plant

(Reuters) - The Wisconsin State Assembly on Thursday opened debate on a $3 billion incentive package for a proposed liquid-crystal display plant by Taiwan's Foxconn, a deal that caused a stir when it was announced by President Donald Trump last month.

Uber wins U.S. court appeal to push price-fixing case to arbitration

NEW YORK (Reuters) - Uber Technologies Inc [UBER.UL] on Thursday won a victory in its effort to keep unhappy customers from suing in court, persuading a federal appeals court to send a Connecticut passenger's price-fixing case against the ride-service company into arbitration.

GM creditor trust drops settlement with ignition switch plaintiffs

NEW YORK (Reuters) - In a blow to people suing General Motors Co over faulty ignition switches and other alleged vehicle defects, a trust that holds many GM liabilities from before its 2009 bankruptcy has canceled a settlement that sought to force the automaker to pay $1 billion in shares to resolve millions of claims.

Ackman's Pershing Square says ADP needs to streamline, modernize

BOSTON/NEW YORK (Reuters) - Billionaire activist investor William Ackman on Thursday said Automatic Data Processing Inc's stock price could double in the next five years if the human resources outsourcing company cuts costs, streamlines its business and invests in technology upgrades.

Germany's Lufthansa gets first say on Air Berlin asset sale: union

BERLIN/FRANKFURT (Reuters) - A first round of formal talks for the sale of insolvent German airline Air Berlin's assets will be held with its bigger local rival Lufthansa on Friday, ahead of other prospective bidders, a senior labour union official said.

BlackRock's largest mutual fund boosts energy holdings: manager

NEW YORK (Reuters) - BlackRock Inc's largest mutual fund hiked its exposure to "select names" in energy as the sector has lagged this year, one of its portfolio managers said on Thursday.

Walmart Customers Blast CEO's Criticism Of Trump: "You Want To Be A Political Pundit, Go On CNN"

Walmart shoppers love the everyday low prices (apparently too low judging by this morning's earnings guidance) they get shopping at the largest big box retailer in the country, but they apparently don't give a rip about the political beliefs of its executive management team.

In fact, Walmart shopper Ed Congdon of Indiana thinks "all CEO's should keep their mouths shut" about political issues unless they want to be a political pundit, in which case they should "go on CNN." Per the New York Times:

"I think all C.E.O.s should keep their mouths shut," said Mr. Congdon, 63, who was listening to the Rush Limbaugh radio show while his wife shopped inside. "You want to be a political pundit, go on CNN."

Mr. Congdon, who drives tractor-trailers for a living, said he agreed with President Trump's hesitation to place the blame for the violence solely on the "conservative side."

"The biggest problem is that they're not calling out the liberal side of things," he said, adding that the Virginia protesters should be "investigated" as to who "paid them."

Of course, these comments come as Walmart shoppers around the country are being asked to respond to CEO Doug McMillon's statement released yesterday which, among other things, criticized President Trump for his response to the Charlottesville tragedy. Here is the full statement he made yesterday per

What The Heck's Going On With Vintage Automobiles?

Authored by Wolf Richter via WolfStreet.com,

The fate of asset bubbles under the new regime.

Everyone is hoping that next Friday and Saturday, at Sotheby's auction in Monterey, California, the global asset class of collector cars will finally pull out of their ugly funk that nearly matches that during the Financial Crisis. "Hope" is the right word. Because reality has already curdled. Sotheby's brims with hope and flair:

Every August, the collector car world gathers to the Monterey Peninsula to see the magnificent roster of best-of-category and stunning rare automobiles that RM Sotheby's has to offer. For over 30 years, it has been the pinnacle of collector car auctions and is known for setting new auction benchmarks with outstanding sales results.

This asset class of beautiful machines - ranging in price from a 1962 Ferrari 250 GTO Berlinetta that sold for $38.1 million in 2014 to classic American muscle cars that can be bought for a few thousand dollars - is in trouble.

The index for collector car prices in the August report by Hagerty, which specializes in insuring vintage automobiles, fell 1.0 point to 157.42. The index is now down 8% year-over-year, and down 15%, or 28.4 points ...

The S&P 500 Is Now Overvalued On 18 Of 20 Valuation Metrics

After last week's brief war with North Korean-inspired volatility explosion (and just as rapid subsequent retracement), some have asked if the resulting market decline, which is down a further 1% on today's latest terrorist attack in Spain, has made stocks more attractive. Here is the quick answer according to Bank of America: based on the 20 most widely used valuation metrics, the S&P remains substantially overvalued on 18 of 20 valuation metrics, the only exceptions being free cash flow, helped by depressed capex), and relative to bonds - the Fed's favorite indicator which got a shout out in yesterday's FOMC minutes - where yields remain depressed thanks to $18 trillion in global central bank purchases.

Some brief thoughts on valuation from BofA's Savita Subramanian:

The S&P 500 forward P/E expanded in July to 17.7x from 17.4x—its highest level in 13½ years—as the market rallied more than estimates climbed. The valuation backdrop forthe S&P 500 remains the same: US stocks trade above historical average levels across nearly all metrics we track, but equities continue to look attractive relative to bonds, where the equity risk premium (ERP) is more than 50% above its long-term average. Multiples expanded across most sectors last month, with the exception of Industrials and Staples—both of which now trade in-line with historical average levels. Energy—which was among the best-performing sectors in July—saw the most multiple expansion last month. The sector continues to trade at a reco ...

Under Armour's Self-Inflicted Wound

A love-hate triangle has ensnared Under Armour, Dick's Sporting Goods and Kohl's. The dynamic among the three companies shows how brands and retail chains are tripping over each other as they struggle to survive fierce competition.

OPEC's Sick Man, Venezuela Could Jolt Oil Market

Venezuela's already falling oil production will get worse before it gets better, potentially roiling global energy markets.

Cisco's Long, Slow Decline

Investors had low expectations for Cisco Systems ahead of its fiscal fourth-quarter results posted Wednesday.

The Wall Street Journal: Donald Trump has failed to kill the AT&T-Time Warner deal, now in advanced stage

The government review of AT&T Inc.'s $85 billion takeover of Time Warner Inc. has reached an advanced stage, a sign that Donald Trump's campaign-trail complaints about media concentration and his disdain for CNN haven't gummed up the vetting process.

Key Words: Ivanka Trump's rabbi is not pleased with her father's response to Charlottesville

"We are appalled by this resurgence of bigotry and anti-Semitism, and the renewed vigor of the neo-Nazis, KKK and alt-right," the wrote in the note, which was posted on Facebook.

Market Extra: Breakdown between Dow, S&P 500 and GE sends an ominous stock-market signal

A bearish breakdown is playing out between the broader U.S. equity benchmarks and General Electric, a key component of the Dow and one of the most storied U.S. companies.

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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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