Written by Gary
US stock future indexes are Flat and fractionally in the red. Microsoft and Google have soften the markets and investors are seriously try to decide on getting out today or waiting until Monday. Indicators are moderately bearish signaling another day or so of negative market action.
Here is the current market situation from CNN Money | |
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22/04/2016 07:24 SPX500 break lower channel, faces resistance on bounce back
We will be watching to see if the overnight price action is a consolidation for a continuation move lower following a breach of lower rising trend-line and test of upper parallel…
22/04/2016 05:45 Nasdaq 100 – Alphabet/Google and Microsoft Sink Futures on Earnings
What Is Moving the Markets
| Here are the headlines moving the markets. | |
 | GE profit tops estimates but organic revenue falls 1 percentNEW YORK (Reuters) – General Electric Co reported a higher-than-expected first-quarter profit on Friday, but a closely watched revenue measure declined, raising questions about the company’s full-year target. |
| Caterpillar quarterly profit declines on weak equipment sales(Reuters) – Caterpillar Inc. posted a lower quarterly net profit on Friday as slowing activity in global mining and construction hurt sales of machinery. |
| All-day breakfast, promotion drive McDonald’s profit beat(Reuters) – McDonald’s Corp reported higher-than-expected quarterly sales and profit as its all-day breakfast and promotional offerings attracted more customers to its U.S. restaurants. |
| Yen tumbles on renewed rate cut talkLONDON (Reuters) – Speculation that the Bank of Japan could effectively start paying banks to borrow its cash caused the yen to tumble on Friday and gave government bonds a lift after a second bruising week in a row. |
| Mitsubishi Motors mileage scandal widens, U.S. regulator seeks informationTOKYO (Reuters) – Mitsubishi Motors Corp’s fuel economy scandal broadened on Friday as U.S. auto safety authorities said they were seeking information, and media reported that the automaker had submitted misleading data on at least one more model than disclosed and likely several others. |
| Honeywell quarterly profit rises 6.3 percent(Reuters) – Honeywell International Inc posted a 6.3 percent rise in quarterly profit, helped by higher sales in its automation and climate control systems division, and the company raised the low end of its full-year earnings forecast. |
| American Air first-quarter profit beats estimates(Reuters) – American Airlines Group Inc reported a first-quarter profit on Friday that exceeded analysts’ expectations as cheap fuel boosted its bottom line. |
| No deal between Greece and lenders on Friday: officialsAMSTERDAM (Reuters) – There will be no deal between Greece and its lenders on Friday that would unlock loans and enable vital debt relief talks, despite some progress on the reforms Athens must implement in exchange, euro zone and IMF officials said on Friday. |
| Ford Motor to recall 42,300 cars in India to fix airbag deployment-related issueNEW DELHI (Reuters) – Ford Motor Co will recall 42,300 cars in India likely affected by a software error “which could result in the airbags not deploying in certain collisions in which they are intended to deploy”, the carmaker’s local arm said on Friday. |
| Greece Fails To Reach Deal With Lenders: Lagarde Flip-Flops, Sees “No Need For Greek Debt Haircut”Greece was supposed to finalize a deal today with its lenders whereby in exchange for an “agreement” to implement already agreed upon budget cuts it would receive more funds from the Troika. However, as Reuters reports, “there will be no deal between Greece and its lenders on Friday that would unlock loans and enable vital debt relief talks, despite some progress on the reforms Athens must implement in exchange, euro zone and IMF officials said on Friday.” “Don’t expect any deals today,” the chairman of euro zone finance ministers Jeroen Dijsselbloem told reporters, noting however, he was “hearing good news from Athens” on headway made in negotiations on a Greek reform package. “There is more work to be done. We are determined to continue the work. We’re not there yet,” International Monetary Fund Managing Director Christine Lagarde said. As has been the case since the third Greek bailout which everyone agreed upon after last summer’s volatile Greek events, the package of Greek reforms is aimed at producing a primary surplus of 3.5 percent of gross domestic product in 2018 “and beyond.” The problem, however, is that Greece has failed to omplement it. As a result, there remains disagreement between Greece, the euro zone and the IMF on whether the measures, which include pension and income tax reform and setting up a privatization fund and a scheme to deal with bad loans, will be enough to reach that number. The IMF believes that as things stand now, instead of 3.5 percent of GDP, Greece will only achieve a primary surplus – the budget surplus before debt-servicing costs – equivalent to 1.5 percent of economic output in 2018. The Fund and the euro zone are also at odds over how long Greece will be able to maintain a primary surplus of 3.5 percent and therefore its ability to service its public debt in the long run. The debt stood at 177 … |
| Inflation is the Goal and Central Banks Will Stop at Nothing to Get It!The markets are prepping for the next massive round of QE. As I noted earlier this week, NIRP has been entirely ineffective at generating Central Bankers’ desired “inflation.” The ECB has cut rates into NIRP four separate times only to find itself with 0% inflation. In contrast, the Bank of Japan has cut rates into zero once and immediately fallen back into a deflationary collapse. Indeed, NIRP has even been a dud when it comes to pushing stocks higher. The ECB’s four NIRP cuts have had a minimal impact on boosting EU stock prices:. The German DAX is roughly flat since the EU first began implementing NIRP.
Indeed, the only significant rally in stocks that the EBC has been able to generate has come via QE.
Ultimately, this leaves more QE as the last remaining monetary tool. QE to buy stocks, QE to buy bonds, QE to buy mortgage securities, etc. And the next round is just around the corner. Both the ECB and Bank of Japan are facing a return to deflation. Japan’s inflation rate is flatlining after a brief boost courtesy of the largest QE program in history. The EU in contrast has seen QE briefly move it towards a deflation rate of 2%… all the more incentive to go for even more.
The goal is inflation. Central Banks wi … |
| Massive Explosion At Chemical Plant Rocks China’s Jiangsu ProvinceJust hours after we reported that a “mysterious illness” resulting from inhalation of toxic chemical fumes was causing hundreds of school children to fall ill in China’s Jiangsu Province, we’re now learning that a massive chemical explosion and fire has taken place in the same province.
The explosion triggered a blaze, the local news portal 163.com reported. Thick plumes of smoke were seen rising from a reservoir that was used to store chemicals and fuel. There were no immediate reports of casualties or a possible cause of the explosion. Witnesses described a strong smell of chemicals. Seven fire crews are struggling to contain the fire, the Caijing magazine said. Fire has spread to two fuel reservoirs after two cisterns burned out. Firefighters were still battling a blaze that broke out at a chemical warehouse in Jiangsu province as of 3:30pm following a blast this morning, Xinhua reports. Reuters confirmed that a fire broke out at a chemical warehouse following a blast around 9am in China’s eastern Jiangsu province. As of right now no casualties have been reported, and the government has said the fire is now under control. Some of the dramatic footage.
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| Google’s Earnings Missed: Why You Shouldn’t WorryGoogle parent Alphabet has a history of falling short of Wall Street expectations. What is happening with the business is more important |
| Everyone Wants a Raise — Except InvestorsThe price for strong bond and stock markets may be anemic wage growth. |
| ECB Corporate Bond Buying: Size Will MatterThe ECB is looming over the eurozone corporate bond market. Investors face a competitor with deep pockets. |
| The Tell: Comcast, cable industry says it already has the answer to TV’s futureCable companies have been scrutinized for giving customers little to no option other than renting expensive proprietary set-top boxes, but are now looking for ways to bring more innovation into the industry. |
| Asia Markets: Japan stocks score second week of gains as yen plungesSigns that China authorities may hold off from further monetary policy easing drives China stocks to the worst weekly performance in three weeks. |
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