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16Jan2018 Market Close: Wild Day On Wall Street As DOW Swings Nearly 400 Points As Possible Government Shutdown Looms, WTI Crude Settles In The High 63 Handle

Written by Gary

The US equities main benchmarks closed in the red, DOW ends down 10 points (SPY -0.3%). Oil retreats from 3-year high as traders await supply data and Amazon stock rockets toward 10th straight record close.

Todays S&P 500 Chart

The Market in Perspective

Here are the headlines moving the markets.

Wall St. eases on lower oil prices

NEW YORK (Reuters) - Wall Street's major stock indexes pared gains in late afternoon trading on Tuesday as lower oil prices weighed on the energy sector.

Citigroup reports $18 billion loss on one-time tax items

(Reuters) - Citigroup Inc posted an $18-billion quarterly loss on Tuesday because of charges related to a new U.S. tax law, but its adjusted earnings beat Wall Street expectations and management signaled that the bank may soon lift financial performance targets.

Health-conscious Nestle sells U.S. candy to Ferrero for $2.8 billion

LONDON/MILAN (Reuters) - Swiss food group Nestle has agreed to sell its U.S. confectionery business to Italy's Ferrero for $2.8 billion, it said on Tuesday, marking CEO Mark Schneider's first big sale and a small step on its path towards healthier products.

Exclusive: U.S. lawmakers urge AT&T to cut commercial ties with Huawei - sources

WASHINGTON (Reuters) - U.S. lawmakers are urging AT&T Inc, the No. 2 wireless carrier, to cut commercial ties to Chinese phone maker Huawei Technologies Co Ltd and oppose plans by telecom operator China Mobile Ltd to enter the U.S. market because of national security concerns, two congressional aides said.

Wells Fargo loses bid to end Philadelphia predatory lending lawsuit

(Reuters) - A federal judge in Philadelphia on Tuesday rejected Wells Fargo & Co's bid to dismiss that city's lawsuit accusing the largest U.S. mortgage lender of predatory lending targeting black and Hispanic borrowers.

German strikes spread to Daimler, union mulls escalation

BERLIN/FRANKFURT (Reuters) - Tens of thousands of German industrial workers downed tools on Tuesday in support of trade union IG Metall's demands for a 6 percent pay rise and a right to the first new cut in weekly working hours since the 1980s.

GM sees flat 2018 earnings, with pickups picking up in 2019

DETROIT (Reuters) - General Motors Co shares rose on Tuesday after the company said 2018 earnings will be largely flat compared with 2017 and forecast higher profits in 2019 when its revamped line of high-margin pickup trucks hits the U.S. market.

Maersk, IBM to launch blockchain-based platform for global trade

COPENHAGEN (Reuters) - The world's largest container shipping firm A.P. Moller-Maersk is teaming up with IBM to create an industry-wide trading platform it says can speed up trade and save billions of dollars.

GE renews break-up talk after $11 billion insurance, tax hit

(Reuters) - General Electric Co again raised the prospect of breaking up the conglomerate on Tuesday as it announced more than $11 billion in charges from its long-term care insurance portfolio and new U.S. tax laws.

Investors 'Stunned' As Stocks Suffer Biggest Reversal In 10 Months; Cryptos Crash

As stocks slumped this afternoon, mainstream media turned into farce...


Emotional Roller-Coaster...

https://www.zerohedge.com/sites/default/files/inline-images/20180116_eod10.png

Futures show yesterday's drift higher and then the opening ramp to record highs... before the plunged to unchanged (and BTFD)...Nasdaq and S&P ended lower from Friday's close...

https://www.zerohedge.com/sites/default/files/inline-images/20180116_eod11.png

No News Was Great News as The Dow topped 26k at the open - rallying that last 1000 points at a record-smashing pace of 0.57% per day (just seven days). This is the most-aggressive rise in The Dow ever... triple the pace of the 24k to 25k advance

Sheriff Joe Arpaio Is Shaking Up Arizona Senate Race

The decision by 85-year-old Sheriff Joe Arpaio to get back into politics by declaring his intention to run for the Arizona Senate Seat being vacated by Sen. Jeff Flake is rattling the state Republican party, which is afraid that a bruising Republican primary been Arpaio, and two female candidates who are backed by the Republican establishment and Steve Bannon, respectively could give Democrats the upper hand in a state that hasn't voted for a Democratic presidential candidate since 1996.

Arpaio's run, according to the Wall Street Journal, is essentially a test of whether the political atmosphere in the state has shifted since he was at the center of the national immigration debate.

Despite his conviction on contempt charges for refusing to honor a court order to stop racially profiling suspected illegal immigrants, a recent poll by ABC 15 Arizona and OH Predictive Insights showed Arpaio in a statistical dead heat with establishment favorite US Rep. Martha McSally.

Arpaio

Indeed, following his pardon from President Trump, a longtime friend and political ally, there's a good chance Arpaio could disappoint the Republican establishment by prevailing in the primary.

...

"We're Gonna Need A Bigger Boat..."

Authored by Chris Hamilton via Econimica blog,

In the movie Jaws, upon seeing the massive size of the shark and inadequacy of the boat they have chosen to hunt the monster, one of the great understated lines of cinema is uttered, "we're gonna need a bigger boat".

https://www.zerohedge.com/sites/default/files/inline-images/20180116_jaws.png

This line has become as ubiquitous as "broken arrow" or "FUBAR" to detail impossible tasks or something broken beyond repair.

I think any of these is appropriate to keep in mind if you take a gander at the charts below.

Only two charts and four variables (plus a bonus chart):

Annual change in the 0-55yr/old global population, excluding Africa (millions persons annually)

Wilshire 5000 ($'s)

  1. Why excluding Africa? Explained HERE.

    The chart below shows the UN medium estimate variant through 2035...which is likely far too optimistic about future birth rates...reality is likely somewhat less population growth than shown.




    The Wilshire represents all publicly traded US stocks and has grown in excess of 7% compounded annually since 1971.

    1. ...

Why Trump's Tax Cuts Will Do Little To Boost Wages (For Now): Goldman Explains



While the new GOP tax plan has generated headlines over one-time bonuses of $1,000 and lowered utility bills, and 18 states have increased minimum wage, Goldman Sachs analysts believes the economic measures will have a marginal near-term impact on wage growth - which ideally keeps up with or outpaces inflation in order to maintain a household's standard of living

Despite negligible short-term effects, medium to long-term wage growth should experience a boost from the tax plan via low unemployment, rising productivity and a gradual pass-through of profits - notwithstanding potential economic crosscurrents

Goldman warns that certain metrics used to determine economic health, such as Average Hourly Earnings (AHE), may prove unreliable in the short-term, as the GOP tax plan incentivizes income-shifting by individuals and corporations in order to minimize taxes

asd

While President Trump tweets about the "Great news" over Wal Mart's minimum wage hike to $11/hour and employee bonuses of up to $1,000 at more than 125 companies thanks to the GOP tax cuts and Jobs Act - and while Treasury Secretary Steve Mnuchin touted climbing paychecks on Thursday in the White House briefing room, questions remai ...

Trouble Ahead for the Treasury Market

Inflation, less central bank bond buying, an increase in supply—there are plenty of reasons for Treasury yields to go a lot higher this year.

The Dollar's Decline Has a Flipside for Markets

It isn't a happy new year for dollar bulls, with the currency starting 2018 by falling to a three-year low. The weak dollar has consequences elsewhere for central banks and markets—but isn't necessarily something to be feared.

Don't Fear a Biotech Correction

Patience from biotechnology investors may be needed this year, but it will be rewarded in the long run.

Capitol Report: Live blog and video of Trump's physical exam results

Dr. Ronny Jackson is due to brief reporters at the White House on the first physical exam taken by President Donald Trump since being elected. Follow along as MarketWatch's Robert Schroeder live-blogs the news.

The Moneyist: My brother told our mom it was a mistake to adopt me — then he put her in assisted care

This woman believes she was cut off from their mother by other son.

Key Words: World's biggest investor hits big business with ultimatum in potential 'watershed moment' for Wall Street

Fink, who runs the world's biggest asset manager, says these companies need to do more than just churn out profits if they want to receive the support of BlackRock and its $6 trillion in investments.

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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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