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11Jan2018 Market Update: Wall Street Higher On Gains In Energy, Industrial Stocks, New Historic Highs, DOW Up Triple Digits, WTI Crude Trading In The Mid 64 Handle, Some Analysts Are Looking For A Market Correction

Written by Gary

The US equities main benchmarks rose this morning (SPY +0.6%), led by Boeing and other big economic growth plays. Wal-Mart's Sam's Club to shut stores after 'review'.


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 S&P 500 gains 0.56%. The IPC is off 0.34%.

What Is Moving the Markets

Here are the headlines moving the markets.

Wall Street higher on gains in energy, industrial stocks

(Reuters) - U.S. stocks rose on Thursday as a jump in oil prices lifted energy stocks to their best day in more than a week and upbeat forecast from No. 2 U.S. carrier Delta Air Lines boosted other airline stocks.

Cheaper services weigh on U.S. wholesale prices; jobless claims up

WASHINGTON (Reuters) - U.S. producer prices fell for the first time in nearly 1-1/2 years in December amid declining costs for services, which could temper expectations that inflation will accelerate in 2018.

Wal-Mart's Sam's Club to shut stores after 'review'

(Reuters) - Sam's Club, a unit of Wal-Mart Stores Inc , closed a series of stores following a review, the membership-only store chain said in a tweet on Thursday.

Canada taking U.S. NAFTA threat seriously, seeks to end logjam

LONDON, Ontario (Reuters) - The threat of the United States quitting NAFTA has to be taken seriously, Canada's foreign minister said on Thursday, even as Ottawa prepares creative ideas to unblock talks to update the tri-nation treaty.

Lower taxes and tight labor market prompt Walmart to hike U.S. wages

NEW YORK (Reuters) - Walmart Stores Inc will raise entry-level wages for U.S. hourly employees to $11 an hour in February as it benefits from last month's major overhaul of the U.S. tax code and competes for low wage workers in a tight labor market.

Hong Kong, London, New York shortlisted for Aramco IPO: sources

DUBAI/LONDON (Reuters) - Saudi Arabia has shortlisted New York, London and Hong Kong - singly or in a combination of two or even all three - for the international portion of the listing of national oil company Aramco, two sources with knowledge of the discussions said.

Kering to spin off Puma to its own shareholders

FRANKFURT/LONDON (Reuters) - Gucci-owner Kering plans to spin off German sports brand Puma to the French conglomerate's shareholders as it sharpens the group's focus squarely on its luxury brands.

South Korea plans to ban cryptocurrency trading, rattles market

SEOUL (Reuters) - South Korea's government said on Thursday it plans to ban cryptocurrency trading, sending bitcoin prices plummeting and throwing the virtual coin market into turmoil as the nation's police and tax authorities raided local exchanges on alleged tax evasion.

Tivo hits Comcast with new round of patent lawsuits

(Reuters) - Tivo Corp has again accused cable operator Comcast Corp of using its patented interactive programming technology without authorization, the latest salvo in the companies' long-running royalty dispute.

Bank of America: "These Are The 4 Things That Can Pop The Central Bank Bubble"

It's a new year... and just like last year, we greet it with not only record highs across equity markets, but a new rip tighter in spreads: as shown below, on Thursday the Barclays corporate index spread hit just +90 bps the tightest since Feb '07.

asd

And, as BofA's Barnaby Martin writes in an overnight note, what should be clear already is that this credit cycle won't simply roll over and die of old age. "Far from it, we think. In fact, we believe one underappreciated risk by the market in 2018 is that Euro credit spreads get squeezed to eye-wateringly tight levels, spurred on by a still-supportive central bank backdrop."

Yet what makes the ongoing grind all the more confusing is that all major central banks are either in the process of hiking rates, shrinking balance sheets and QE, or at the very least signalling the limits to their monetary policy.

What's going on?

According to Barnaby, "the current backdrop feels very reminiscent of the Greenspan era of 2004-2006. Back then US interest rates rose 17 times. Yet, financial conditions remained loose and interest rate volatility fell to very low levels precisely because Fed monetary tightening was so predictable and patient: rates generally rose by 25bp at each meeting."

And, as discussed here previously, fast forwarding to today reveals that the same backdrop has taken hold: namely that despite hawkish overtones by cen ...

Stocks Are Melting-Up Again

Remember those China headlines...

US equity markets are melting up this morning with S&P at new record highs and Dow topping 25,500 for the first time ever...

https://www.zerohedge.com/sites/default/files/inline-images/20180111_china.png

And while stocks are exuberant, bonds are going nowhere...

https://www.zerohedge.com/sites/default/files/inline-images/20180111_china1.png

And notably VIX is rising with stocks melt-up - suggesting call-buying exuberance...

US-backed Forces In Syria Release Hundreds Of ISIS Members

Submitted by South Front

The US-backed Syrian Democratic Forces (SDF) released 400 former ISIS fighters a mere few weeks after they had been captured, the opposition media outlet Syrian Observatory for Human Rights (SOHR) reported on Tuesday. The report added that the released ISIS fighters include dozens of well-known ISIS members and commanders.

Moreover, the SOHR said that the SDF even allowed 120 former ISIS fighters from Deir Ezzor and al-Hasakah governorates to join its ranks. The former ISIS fighters who joined the SDF are all related to SDF leaders, according to the report.

asd
Image source: Al Shahid News

The release of these former ISIS fighters has led to new tensions in eastern Syria, as the locals who were victims of these fighters clashed with them in many villages, according to the SOHR. The media outlet even said that weapons were used by the new "SDF members" against the locals; however, the US-backed forces didn't step in to end the clashes, according to the source.

Significantly, SOHR is a well-known pro-rebel opposition source which has served as a go-to prime outlet for the mainstream media over the course of the war in Syria. The original report reads as follows:

...

House Passes Legislation Renewing Controversial NSA Surveillance Program

Update 2: The Foreign Intelligence Surveillance Act has been renewed by the House of Representatives. Originally enacted in 1978, the act outlines the lawful procedure for collecting foreign intelligence. FISA Section 702 allows the US government to pull in communications from foreign nationals but does not permit surveillance of US citizens, even if they are suspected of criminality or terrorism. Ahead of a vote to extend FISA for six years, US President Donald

Trump initially hit out at the key intelligence provision, although later updated his stance through a tweet declaring that the country needs FISA.

With that being said, I have personally directed the fix to the unmasking process since taking office and today's vote is about foreign surveillance of foreign bad guys on foreign land. We need it! Get smart!

— Donald J. Trump (@realDonaldTrump) January 11, 2018

As Glenn Greenwald notes, this is the list of House Democrats who stood with Trump, Devin Nunes and the NSA to ensure ongoing warrantless eavesdropping on Americans, adding "Note how many of the leading #Resistance leaders are on this list."

55 House Democrats - including Pelosi, Hoyer, Schiff - voted to kill a surveillance reform bill that would have (among other things) added a warrant requirement to 702 searches.

Full list of Dem 'no' votes: pic.twitter.com/gqX8C8KbqK

— George Zornick (@gzornick) J ...

Chinese Dragon Still Needs U.S. Treasurys for Its Hoard

Conflicting media reports over the past 24 hours imply China may be considering buying fewer U.S. Treasurys. That matters less than the bond market seems to think.

Xerox Should Look to Copy Fujifilm's Success

The venerable U.S. company Xerox could find a tie-up with its longtime joint-venture partner Fujifilm helps it to reinvent itself.

Will Airlines Blow Their Tax Windfall?

U.S. airlines are among the biggest beneficiaries of the tax plan. But investors worry that they also may be at the greatest danger of competing their tax gains away.

Key Words: Trump's new envoy to Holland squirms through one of the most awkward press conferences ever

It turns out the U.S. doesn't have a monopoly on excruciatingly awkward interviews with members of Team Trump.

Europe Markets: European stocks drop as retailers fall, euro leaps on hawkish ECB prospects

European stocks finished at their lowest in a week Thursday, as investors considered a signal from the European Central Bank that it's positioning for a more hawkish view on monetary policy.

Here's what the 30 Dow industrials companies say about blockchain

MarketWatch asked all 30 members of the Dow industrials what blockchain initiatives they have in place, or plan to have.

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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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