13Apr2017 Market Update: US Stocks Moderately Lower, US Dollar Fractionally Stronger And WTI Crude Prices Slip, Tomorrow's Session Could Look A Lot Like Today

Written by Gary

Wall Street has edged lower today (SPY -0.4%) after briefly sporting green and now is set to book losses for the third straight day as investors weighed earnings from big U.S. banks and President Donald Trump’s comments on the strength of the dollar.

Here is the current market situation from CNN Money
	North and South American markets are broadly lower today with shares in Mexico off the most. The IPC is down 1.37% while Brazil’s Bovespa is off 1.17% and U.S.’s S&P 500 is lower by 0.43%.

What Is Moving the Markets

Here are the headlines moving the markets.
	U.S. labor market tightening, inflation trending higher WASHINGTON (Reuters) – The number of Americans filing for unemployment aid unexpectedly fell last week and consumer sentiment rose early this month amid continued optimism over household finances, suggesting a sharp slowdown in job growth in March was an aberration.
	Wall Street dips as investors parse bank earnings (Reuters) – Wall Street edged lower on Thursday and looked set to book losses for the third straight day as investors weighed earnings from big U.S. banks and President Donald Trump’s comments on the strength of the dollar.
	Loan growth stalls despite profit, trading gains at some big banks NEW YORK (Reuters) – Big U.S. banks revealed more evidence of a slowdown in loan growth in their earnings reports on Thursday, though executives assured there is still healthy demand from borrowers and no reason to worry about the state of the economy.
	Self-driving ‘arms race’ complicates supplier alliances FRANKFURT/DETROIT (Reuters) – The race to develop and exploit autonomous vehicle technology is reshaping the hierarchy of the automotive industry, replacing traditional top-down manufacturing relationships with complex webs of alliances and acquisitions.
	U.S. producer prices post first drop in seven months WASHINGTON (Reuters) – U.S. producer prices fell in March for the first time in seven months, weighed down by a drop in the cost of services and energy products, but the
	Tesla’s Musk tells disgruntled shareholders: Buy Ford SAN FRANCISCO/DETROIT (Reuters) – A group of Tesla Inc investors has urged the luxury electric car maker to add two new independent directors to its board, without ties to Chief Executive Elon Musk, to “provide a critical check on possible dysfunctional group dynamics.”
	‘Trump Trade’ winners switch into battered retail, biotech shares NEW YORK (Reuters) – Some of the actively managed funds that have performed the best since the Nov. 8 presidential election are switching from “Trump Trade” bets on financial and infrastructure stocks into beaten-down sectors such as retail, apparel or biotech.
	Boardroom excess? British companies stick with bonus plans despite criticism LONDON (Reuters) – Pressure on British companies to ditch a common performance-related bonus scheme blamed for generating excessive executive pay has not stopped many firms from planning to stick with such schemes for another three years, a Reuters analysis shows.
	Citi profit beats estimates as fixed-income trading jumps (Reuters) – Citigroup Inc reported a higher-than-expected quarterly profit as the bank’s fixed-income trading was boosted by clients adjusting their positions following rate hikes by the Federal Reserve and changes in the forex and credit markets.
	Yellen’s Setting Up the Markets For Their Third Fed-Caused Crash Janet Yellen is playing with matches next to a $20 Trillion Debt Bomb. During her speech at the Gerald R. Ford School of Public Policy in Michigan, Yellen stated that the biggest risk to monetary policy is for the Fed to “get behind the curve” regarding inflation. To that end, the Yellen Fed has already raised interest rates twice in the last six months. And it is pushing for yet another rate hike in June. However, Yellen as usual is missing the bigger issue: the risk of DEBT deflation triggered by the Fed’s rate hikes. Since the 2008 Crisis, the US has been on a debt binge unlike anything we’ve ever seen before. Thanks to seven years of ZIRP and $3.5 TRILLION in QE, the US’s debt load has nearly doubled, bringing our Debt to GDP ratio well over 100%. Now Yellen wants to raise rates even more, in her hopes of catching up with inflation… But what happens to the US’s massive debt pile as the Fed keep’s raisings rates, making the debt MORE expensive to pay off? In 2016, when rates were still 0.5%, the average US interest payment was already 1.9%. What happens to this when the Fed keeps raising rates, pushing the yield on the debt even higher? The markets are already “smelling” this. Already the 30-Year US Treasury bond has dropped sharply to critical support (the blue line). And that’s before the Fed even raises rates in June, let alone pushes to start shrinking its balance sheet later this year. Truth be told, we’re not that far off from a debt crisis. Greece’s Debt to …
	Banks Are Getting Battered (As Investors Actually Read Earnings Reports) Judging by the exuberant comments from analysts and TV anchors, one would imagine US banks would be soaring. But having dug below the public-relations-spin surface, the results are anything but encouraging – surging credit card charge-offs, tumbling mortgage issuance, and flat NIMs – this is not what the talking heads promised… Year-to-Date, everything is red… And if you’re surprised by JPMorgan’s drop, don’t be…
	Trump’s Policies Spell Impending Recession for America If President Trump continues down his current path of protectionism and anti-globalization, to try and put “America First”; then retaliatory measures by other world powers, huge domestic deficits, massive job losses and spiralling inflation could in fact put America last! Those are words coming from Mark T. Williams, Boston University finance professor, former Fed official and author of the acclaimed book on the Lehman Brothers debacle “Uncontrolled Risk”. DIRE PREDICTIONS According to Williams, Trump’s economic and foreign policies ignore the undeniable benefits that free and open trade has delivered globally. Going back in history, it has been free trade that has made post WWII America into the global economic powerhouse that it is today. To support his thesis, Williams points to America’s $18 trillion plus GDP, and a $2.5 trillion export market as proof that global trade does pay – especially for America. Exports are responsible for creating and supporting nearly 12 million American jobs; with nearly 25% of all manufacturing jobs in some way related to exports. Should Trump turn his economic guns to China, Williams predicts there will be a backlash that would only end in pushing America over the recession cliff. With a population of over 1.4 people, China’s growing middle class offers American exporter’s exceptional opportunity to further increase their trade footprint. Additionally, as a low-cost producer, China provides American consumers greater choice to buy lower-priced consumer products at home. Any hint of a proposed 45% border tax kicking in, and China may very well stop importing items such as Automobiles, Soybeans and Boeing aircraft, amongst a host of others. And such a move will definitely lead to massive job losses in American factories. A trade war with America’s Southern neighbor Mexico could further aggravate America’s fragile, yet recovering, economy. …
	US Oil Rig Count Surges To 2-Year High – Will Shake Kill The Oil Rally Again? For the 14th straight week, US oil rig counts rose (by 11 to 683). This is the highest since April 2015… and leads US crude production to its highest level since Aug 2015. The question is, as OilPrice.com’s Nick Cunningham asks, will Shale kill off the recent oil price rally again? WTI has rallied more than 11 percent over the past month, raising hopes from oil bulls that maybe, just maybe, the price gains are here to stay. Oil had dipped in February and March on record high levels of oil sitting in U.S. storage, but by April, the market is starting to look tighter. The oil market bust is closing in on the three-year mark, and there are growing signs that things could finally be moving in the right direction. Despite the record high levels of crude oil storage in the U.S., inventories are falling pretty much everywhere else. South Africa, the Caribbean, Nigeria, and Iran are all reporting lower inventory figures, although the reasons vary. Iran cleared out its fleet of floating storage, which had built up during years of sanctions that prevented the Islamic Republic from exporting to its full potential. That backlog of oil has now been worked through and Iran could have tr …
	Trump’s New Chumminess With China Could Easily Reverse The factors pushing the U.S. president into a closer embrace of China have been apparent for some time: the rising threat from North Korea paired with a better economy at home. If the latter disappoints, however, tensions could rebound quickly.
	Retail Sales: It Isn’t the Weather This Time Weak consumer spending growth can be blamed on slower auto sales and higher savings, but could weigh on the economy.
	Back to the Chinese Boom Years in Luxury? Not Likely China is going wild for luxury handbags—again—but investors should be wary of partying like it’s 2010.
	Caterpillar short sellers scale back positions after losses of almost $1 billion in 2016 Investors betting a prolonged sales slump would crush Caterpillar stock were wrong. Now the company is the subject of a federal probe.
	Deep Dive: This dividend stock ETF can help you make money by avoiding losses James Norman of QS Investors explains the attraction of a low-volatility strategy as stocks hover near record highs.
	U.S. drops ‘MOAB,’ a ‘Mother of All Bombs,’ in Afghanistan, according to reports The U.S. Air Force has deployed a so-called GBU-43/B Massive Ordnance Air Blast bomb, known as the “Mother of All bombs” in Afghanistan, according to multiple reports, citing military personnel.