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24Aug2017 Market Update: Wall Street Trending Down In An Exaggerated Sea Saw Fashion, DOW Down 5 Points, WTI Crude Slips To The Low 47 Handle

Written by Gary

U.S. stocks are finding direction difficult (SPY -0.2%), as investors remained cautious ahead of the gathering of bankers at Jackson Hole. Also, the number of Americans filing for unemployment benefits rose less than expected last week.


Here is the current market situation from CNN Money

North and South American markets are mixed today. The Bovespa is up 0.55% while the IPC gains 0.38%. The S&P 500 is off 0.15%.

What Is Moving the Markets

Here are the headlines moving the markets.

Wall Street little changed as focus shifts to Jackson Hole

(Reuters) - U.S. stocks struggled for direction late on Thursday morning, as investors remained cautious ahead of the kickoff of the annual gathering of central bankers at Jackson Hole, Wyoming.

U.S. jobless claims rise slightly as labor market tightens

WASHINGTON (Reuters) - The number of Americans filing for unemployment benefits rose less than expected last week, suggesting a further tightening in labor market conditions.

Seoul court to rule on Samsung scion Lee in bribery trial

SEOUL (Reuters) - A South Korean court will rule on Friday on corruption charges against Jay Y. Lee, the billionaire head of Samsung Group, after a six-month trial in a nationwide bribery scandal that triggered the dismissal from office of the country's president.

U.S. retailers hit as immigration worries weigh on Hispanic spending

CHICAGO (Reuters) - Many U.S. Hispanics are venturing out only to buy essential goods and are cutting back on discretionary spending, worried about possible harassment by immigration or law enforcement officials since the election of U.S. President Donald Trump, according to community groups, research firms and retailers.

Exclusive: Small UK companies complain after HSBC accounts frozen

LONDON (Reuters) - An avocado importer, an e-cigarette seller and a toilet-cleaning gun maker are among British companies that have had accounts closed or frozen by HSBC in the last two months, unintended casualties of a crackdown by the bank on illicit money flows.

Australia's Qantas firms up plans for world's longest commercial flight

SINGAPORE (Reuters) - Qantas Airways is set to formally announce plans to offer 20-hour non-stop flights from Sydney to London by 2022 if Airbus SE or Boeing Co can deliver aircraft that meet the distance, a source familiar with the matter said.

Saudis may seek funding in Chinese yuan

JEDDAH, Saudi Arabia (Reuters) - Saudi Arabia is willing to consider funding itself partly in Chinese yuan, a senior Saudi official said on Thursday, raising the possibility of closer financial ties between the two countries.

Papa John's Russian franchisee to expand in Central Asia, Poland

MOSCOW (Reuters) - U.S. pizza chain Papa John's International Inc plans to expand into of Kazakhstan, Kyrgyzstan and Poland, the company's franchisee in Russia and Belarus said on Thursday.

Western Digital group to offer $17.4 billion for Toshiba chip unit: sources

TOKYO (Reuters) - A consortium that includes Western Digital is offering 1.9 trillion yen ($17.4 billion) for Toshiba Corp's memory chip business, which the Japanese conglomerate is trying to sell to cover losses from its U.S. nuclear business, sources said on Thursday.

Mauldin: 2 Charts Confirm A US Recession Within 18 Months

Authored by John Mauldin via MauldinEconomics.com,

Stock valuations are the discounted values of future earnings. Future earnings depend on future revenue, which may diminish whenever the future includes a recession. So, broad economic conditions are a big factor to watch in stock valuation.

Broad economic conditions depend ultimately on the consumer's ability and willingness to spend money. And July's retail sales report gave us a peek at that.

Why Consumer Spending Is Still Low Compared to Previous Recoveries

Core retail sales rose 0.6% from June. The uptick was more than analysts expected, and most categories were up, too. The exceptions were clothing and electronics sales.

The latter may have to do with potential smartphone buyers waiting to see new iPhone models expected to debut this fall.

Peter Boockvar summed up the bigger picture:

Bottom line, after the slowest y/o/y core sales gain since March 2016 in June of 2.5%, they rose by 3.6% y/o/y in July, which is about in line with the 5-year average of 3.3%. This pace, though, still remains well below the 5%+ growth rates in the two prior recoveries. Here are some reasons why: Many consumers have jobs, but we know accelerating wage gains remain spotty; the savings rate is near the lowest level since 2008; and credit card debt, student loans, and car loans each total $1T+. Lastly, we know healthcare spending (high deductibles) and rent have dominated the budgets of many.

Consumer spending, at least according to this rep ...

Mnuchin's PR Visit to Fort Knox proves nothing about the US Gold Reserves

Submitted by Ronan Manly, BullionStar.com

On the afternoon of Monday, August 21, US Treasury Secretary Steven Mnuchin, Senate Majority Leader Mitch McConnell, Kentucky Governor Matt Bevin, and Kentucky Congressman Brett Guthrie took a visit to the vault of the US Mint's gold depository in Fort Knox, Kentucky, a vault which, according to the US Treasury, holds gold bars containing 147,341,858 fine troy ounces of gold (4583 tonnes of gold).

The trip was notable in that it is one of the rare occasions in history that a US political/congressional delegation has ever visited the Fort Knox depository, and Mnuchin is now only the 3rd treasury secretary ever to make this visit.

The trip was also notable in that unlike previous political excursions to the vault, the Mnuchin-led visit was very low-key, it was announced to the media and public at extremely short notice, and there is no evidence that any media representatives participated, or at least if they did, they have kept very quiet about it.

US Consumer Comfort Spikes To 16 Year Highs, But...

Great News Americans - According to Bloomberg's latest Consumer Comfort survey, you are the most 'comfortable' since 2001!

Despite slumping 'hard' economic data, soaring stocks seem to reassure 'Americans'...



Sentiment among those earning $100,000 or more rose to the highest since March on the heels of elevated equity markets

Comfort advanced in the Northeast to the highest since March 2007 and rose in the West

Confidence among Republicans rose to an almost 10-year high, while comfort of political independents was strongest in more than 16 years

Among married people, weekly sentiment reached the highest level since March 2001

That's great news right!? Well, in reality it has had ZERO impact on what really matters...

The exuberant consumers are not consuming...

Source: @lizzie363

And that means companies are not earning...

Sour ...

$20 Oil? Forget OPEC, China Controls Oil Prices

Authored by Irina Slav via OilPrice.com,

U.S. shale has taken a lot of headline space recently as the biggest headwind for oil prices and the highest stumbling block for OPEC's efforts to prop them up by cutting production. Yet, there may be another factor that could bring down oil prices as soon as next year...

China.

China has been building a strategic crude oil reserve for the last decade, but the size of that reserve remains undisclosed, with analysts making estimates based on China-bound cargoes and satellite imaging.

Last year, a Silicone Valley tech company, Orbital Insight, suggested that China may have stored as much as 600 million barrels of crude by May. This was the highest reserve estimate at the time. Since then, the reserve has in all likelihood grown, possibly exceeding the U.S. SPR, which stood at 678.9 million barrels as of August 18th this year.

This year, Chinese crude imports have run at record-breaking rates, with the average daily on par with what the U.S. imports, at about 8 million barrels, the Financial Times notes in an analysis. A lot of these, however, are going into storage tanks, analysts believe, and they warn that ...

Merck Is Good for Your Portfolio's Health

Buying Merck gives investors exposure to the most promising cancer drug on the market at a good price.

China's Mobile-Payment Food Fight

China's leading internet search company, Baidu, is moving out of the food delivery business, ceding ground to its two largest domestic tech rivals, which dominate the sector.

Clouds Part for Europe This Year

The latest cloud on the horizon has been the rising euro, but the eurozone of 2017 appears to be proving a resilient place.

July 2017 Headline Existing Home Growth Slows Again

Written by Steven Hansen

The headline existing home sales growth slowed with the authors saying "Contract activity has mostly trended downward since February and ultimately put a large dent on closings last month". Our analysis of the unadjusted data agrees.

SEC halts trading in First Bitcoin Capital shares, which have gained more than 6,000% in 2017

The Securities and Exchange Commission on Thursday temporarily suspended trading in the shares of First Bitcoin Capital Corp. because of concerns about the accuracy and adequacy of public information on the Canadian company.

NewsWatch: Fearful of awakening market bears, Yellen and Draghi to tread softly at Jackson Hole

Federal Reserve Chairwoman Janet Yellen and European Central Bank chief Mario Draghi have every incentive to be speak softly in their speeches Friday at the U.S. central bank's summer retreat in Jackson Hole, located just down the road from the southern entrance to Yellowstone National Park.

Online pet pharmacy shares rebound after accusation that it's exploiting opioid epidemic

The corporate skirmish comes at a time of renewed attention to the possibility of pet opioid abuse.

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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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