05Jan2017 Market Update: Wall Street Remains Directionless And In Negative Territory, Crude Price Rise Off Session Lows, DOW Off 66 Points

Here is the current market situation from CNN Money

North and South American markets are mixed. The Bovespa is higher by 1.14%, while U.S.’s S&P 500 is off 0.20%. Shares in Mexico are unchanged with the IPC at 46,587.98.

Verizon executive says company unsure about Yahoo deal

(Reuters) – A senior executive of Verizon Communications Inc said on Thursday the company was unsure about its planned acquisition of Yahoo Inc’s internet business.

Bitcoin plunges as much as 20 percent as Chinese yuan soars

LONDON (Reuters) – A dramatic rally in digital currency bitcoin came to a spectacular end on Thursday with a plunge of up to 20 percent as China’s yuan rose sharply – further evidence of an intriguing inverse relationship between the pair.

Exclusive: Viacom to announce executive changes – sources

(Reuters) – Viacom Inc is expected to announce changes to its executive ranks as new Chief Executive Bob Bakish seeks to turn around the ailing media company, two sources told Reuters on Thursday.

Dismal holiday sales at Macy’s, Kohl’s spell gloom for sector

(Reuters) – Disappointing holiday season sales at Macy’s Inc and Kohl’s Corp underscored the uphill task department stores face in winning back shoppers, who are increasingly turning to online retailers and spending less on apparel.

Bank stocks bring down S&P, Dow; techs prop up Nasdaq

(Reuters) – A rise in technology stocks helped the Nasdaq eke out small gains on Thursday but was not enough to pull the S&P 500 and the Dow into the black as banks stocks weighed.

Surge in orders boosts services sector; jobless claims tumble

WASHINGTON (Reuters) – U.S. services sector activity held at a one-year high in December as new orders surged, while the number of Americans filing for unemployment benefits fell to near a 43-year-low last week, suggesting the economy ended 2016 with strong momentum.

Mexico central bank sells $1 billion to prop peso after Trump slump: traders

MEXICO CITY (Reuters) – Mexico’s central bank sold dollars in Mexico and New York on Thursday to fight off the peso’s nose dive to record lows amid fears U.S. President-elect Donald Trump’s protectionist policies could further hammer Latin America’s second biggest economy.

Exclusive: Nissan halts joint development of luxury cars with Daimler – sources

PARIS (Reuters) – Nissan is halting joint development of luxury cars with Daimler’s Mercedes-Benz, sources close to the companies told Reuters, suspending a key project in their seven-year partnership and potentially hitting profitability at a new shared factory in Mexico.

Sales practices a key risk to banking system, says U.S. regulator

WASHINGTON (Reuters) – Wells Fargo’s phony account scandal has spurred a top U.S. bank regulator to count sales practices as a chief risk to the country’s banking system and to embark on a wide-sweeping review of large and mid-sized institutions.

More Brilliance from Larry Summers

This post and full archives can be viewed at Trader Scott’s Market Blog.

The brilliant PHD economist Lawrence Henry “Larry” Summers has come out with a scathing criticism of Donald Trump’s economic policy:
“The Navarro-Ross paper is well beyond voodoo economics,” Summers said of the September report on Trump’s growth plans. “The logic of it, the arguments made, are so far out of the mainstream of any kind of responsible economic thinking that they are the economic equivalent of creationism.”

Key Takeaways From Intelligence Community Testimony On Alleged “Russian Hacking”

For those disaffected Hillary snowflakes looking for some level of concrete, tangible evidence from today’s Senate testimony from the “intelligence community” that “Russian Hackers” purposefully colluded with President-elect Trump to steal the 2016 election from Clinton, we have some bad news: your desire for evidence required to start World War III over your candidate’s loss has still not been fulfilled. Better luck next time.

As we suspected, today’s testimony offered up by James Clapper and others of the “intelligence community” to the Senate’s Armed Forces Committee has largely been nothing more than another smear campaign rife with political rhetoric but light on facts and tangible evidence.

With that, here are some of the notable one-liners from the day.

John McCain opened the hearing by noting that the goal of the day was not to “question the outcome of the presidential election” but to gather “facts” about what happened…even though no facts actually followed, but we digress.

“The goal…is not to question the outcome of the presidential election. Nor should it be. As both President Obama and President-elect Trump have said, our nation must move forward. But we must do so with full knowledge of the facts.”

Senator Jack Reed (D-Rhode Island) used his time to call for the creation of a “special select Senate committee” to look further into the “Russian Hacking” narrative since it spills across the jurisdictional divide.

.@SenJackReed calls for creation of special select Senate committee on #Russianhacking since it spills across jurisdictional divide.

Americans Prefer Cats To Kids After The Great Recession

Submitted by John Mauldin via MauldinEconomics.com,

More and more Americans seem to prefer pets to children… and the resulting demographic trend has massive economic and investment implications.

The numbers are startling and affect everyone—whether you’re a parent, a pet owner, neither, or both. It’s also an investment opportunity you might try in 2017.

4 million missing babies

While the memories of the Great Recession may be fading, the effects are still very much with us. Among other places, the impact shows up in demographic data.

Last summer, I ran across some fascinating analysis by University of New Hampshire sociologist Kenneth M. Johnson. He found that US fertility levels dropped sharply beginning in 2008 and have yet to recover.

All those babies we didn’t have add up to a big number.

Professor Jo …

Crude Jumps On Report Saudis Fully Implemented OPEC Output Cut

Despite earlier comments that the Saudis did not appear to have implemented their output cut (as per OPEC agreement), WSJ reports that Saudi Arabia cut oil output – fully implementing OPEC cut pledge. Oil is bouncing on the news.

From this morning – no cut!:

Saudi Arabia crude supplies have been abundant and doesn’t look to be cutting, Takashi Hirose, Executive Vice President at TonenGeneral, says in Tokyo on Thursday.

And now – Fully cut…

BREAKING: Saudi Arabia has cut oil output by at least 486,000 b/d 10.058 million b/d, fully implementing OPEC cut pledge: Source @WSJ

— Georgi Kantchev (@georgikantchev) January 5, 2017

which has provided a modest bid to crude prices…

The move is very modest though – it seems either everyone is fully positioned or no one really believes it.

China’s Electric-Vehicle Strategy Riddled With Potholes

China will be the world’s largest user of electric cars. It won’t necessarily dominate producing them.

Envisioning a Fannie and Freddie Endgame

Fannie Mae and Freddie Mac can only be dealt with through a comprehensive solution that takes into account the interests of homeowners.

Chinese Yuan Is Other Side of Bouncing Bitcoin

Bitcoin’s record rally and fast plunge is more about the weakening of the Chinese yuan than a sudden crusade against fiat money.

December 2016 ISM and Markit Services Show Little Change In Rate of Growth

Written by Steven Hansen

The ISM non-manufacturing (aka ISM Services) index continues its growth cycle,but remained unchanged at 57.2 (above 50 signals expansion). Important internals were mixed. Markit PMI Services Index also released today declined but remains in expansion..

Commodities Corner: U.S. may become a net energy exporter in less than a decade

The U.S. could become a net energy exports in less than a decade, according to an annual outlook report from the Energy Information Administration.

Corzine ordered to pay $5 million fine over unlawful use of customer funds

A federal court sided with the U.S. Commodity Futures Trading Commission in its suit against Jon Corzine, requiring the former CEO of MF Global to pay $5 million for his role the unlawful use of $1 billion in customer funds.

Howard Gold’s No-Nonsense Investing: Donald Trump is at the center of any stock market prediction for 2017

What he and his fellow Republicans in Congress do will largely determine the direction of the economy and equities.