Written by Gary
US stock markets closed higher (SPY +0.5%) and the DOW closed up 56 points. Investors reacted to economic data and took cautious hope and gasoline futures surged 10 percent.
Todays S&P 500 Chart
The Market in Perspective
| Here are the headlines moving the markets. | |
 | Wall Street gains on data and Mnuchin tax reform remarksNEW YORK (Reuters) – U.S. stocks closed higher on Thursday as investors reacted to economic data and took cautious hope from Washington’s latest promises for long-awaited details of a tax reform plan. |
| Truck maker Volvo targets operating margin above 10 percentSTOCKHOLM (Reuters) – Sweden’s Volvo , one of the world’s biggest truck makers, on Thursday set new financial targets, and said it aimed for an operating margin above 10 percent over a business cycle. |
| Oil rises, gasoline jumps 10 percent as U.S. refineries reelNEW YORK (Reuters) – Gasoline futures surged 10 percent on Thursday as almost a quarter of U.S. refining capacity remained offline and traders scrambled to reroute millions of barrels of fuel, while oil prices rose nearly 3 percent. |
| Cash flowing again from Fed’s flood-threatened Houston branch(Reuters) – Cash has begun flowing again from the Federal Reserve’s steel and cement vault in Houston, heading for banks in the hurricane-ravaged region after several days of flooding halted armored-truck deliveries and stranded employees overnight. |
| U.S. consumer spending rises modestly; inflation retreatsWASHINGTON (Reuters) – U.S. consumer spending rose slightly less than expected in July and annual inflation advanced at its slowest pace in more than 1-1/2 years, diminishing expectations of an interest rate increase in December. |
| Car makers, retailers rush to open, restock Houston after HarveyDETROIT (Reuters) – Houston area car retailers and automakers are rushing to reopen dealerships and beef up inventory to replace many thousands of vehicles damaged in flooding from Hurricane Harvey. |
| Facebook’s Watch goes up against YouTube for ad dollars(Reuters) – Facebook Inc launched its Watch video service to U.S. users on Thursday with plans to allow people to submit shows, as the No. 1 social media network vies with Alphabet Inc’s YouTube for advertising revenue. |
| GE’s new CEO preparing job cuts in bid to reduce costs: sourceNEW YORK (Reuters) – General Electric Co is making plans to significantly reduce corporate staff in an effort to cut spending and boost profits under its new chief executive, and the company already has halted hiring in certain technology positions, a person familiar with the situation told Reuters. |
| Volkswagen U.S. plant building 400 Atlas SUVs a day: executive(Reuters) – German automaker Volkswagen’s U.S. plant in Chattanooga, Tennessee, is building 400 Atlas SUVs a day, close to capacity and on pace to reach 100,000 per year, Matthias Erb, who heads VW’s North American engineering team, said on Thursday. |
| Gold Pops, S&P Stops, And Bonds Have Best Month Since BrexitOne look at the last few days in stocks and all we can say is… Gold and The Long Bond were the best performers in August with stocks and the dollar unchanged-ish
Trannies were best among the major indices in August followed by Nasdaq. Small Caps lagged. S&P just managed to close green for August.
Treasury yields tumbled in August… the biggest monthly drop for 10Y yields since Brexit (June 2016)
With the yield curve flattening dramatically… August saw 2s10s collapsed 15bps to below 80bps (the biggest flattening since Feb 2016) near its flattest level since Aug 2016
D … |
| Bitcoin Surges To New Record High, Overtakes Paypal & Netflix, Nears Morgan Stanley’s Market CapAmid chaotic swings in the dollar, and flash-crashes in precious metals, it seems anxious global investors have pushed into cryptocurrencies as a safe-haven overnight with the top 5 virtual currencies all soaring.
Bitcoin has reached a new record high at $4740…
Pushing its total market cap near that of Morgan Stanley.
Bitcoin is now bigger than 425 of the S&P’s 500 members. On a side note, GBTC (the bitcoin investment trust) is now trading at $927 (implying a Bitcoin price of $9270!) and trading at a $120% premium to NAV…
Buyer beware! |
| New Evidence Reveals Comey Drafted Statement Exonerating Hillary Before Key Witness InterviewsA new letter from Senators Chuck Grassley and Lindsey Graham reveal testimony from new witnesses suggesting that former FBI Director James Comey had already started drafting documentation exonerating Hillary Clinton long before interviewing key witnesses, including Hillary herself. According to the letter, which is based on testimony from James Rybicki, Comey’s Chief of Staff, and Trisha Anderson, the Principal Deputy General Counsel of National Security and Cyberlaw, Comey began drafting a statement to announce the conclusion of the Hillary investigation in April or May 2016, well before he had interviewed up to 17 key witnesses. Meanwhile, as if that weren’t bad enough, the Comey statement was also drafted before immunity deals were struck with Cheryl Mills and Heather Samuelson who seemingly ran point, along with Platte River Networks, to destroy Hillary’s emails after a Congressional subpoena had been issued mandating their preservation. Here is a summary from the Grassley/Graham letter:
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| Breadth, Bonds, Bills, & Bear Funds Signal Trouble Ahead For StocksThe ‘resilience’ of stock markets is proclaimed as self-reflectingly positive, as they surge higher, enthusiastically embracing debt ceiling anxiety, nuclear armageddon, and biblical floods. However, below the surface all is very much not rosy… As Bloomberg reports, this is a warning for stock traders entranced by a market that remains resilient to surprises. Even though the S&P 500 is less than 1 percent away from a record set this month, the best move is to wait out more selling, according to Strategas Research Partners. Breadth has deteriorated as the benchmark gauge has been mostly listless. Only about 48 percent of stocks in the S&P 500 are currently trading above their 50-day moving averages, near the fewest of the year and down from 74 percent last month, data compiled by Bloomberg show.
And longer-term trends are just as bad with only 65% of S&P members above their 200-day average…
“Tepid momentum is often consistent with below average returns in the short-run,” Strategas analysts led by Chris Verrone wrote in a research note Tuesday. *& … |
| Costco Stock at a DiscountOne of the few ways for retailers to compete against the growing might of Amazon.com is to offer something different. Costco Wholesale does that, but the market has been unwilling of late to give it credit for its uniqueness. |
| Emerging-Market Bonds: The Stars AlignLow inflation is a puzzle in developed markets, but a pleasant and powerful phenomenon for emerging-market bonds |
| Beijing Shows Its Power With China’s Latest MegamergerThe combination of the country’s leading coal miner and power producer is the clearest sign yet of Chinese leaders’ desire to enhance the role of big state-owned companies. |
| Outside the Box: 10 questions to ask yourself before you buy — or sell — a houseHousing is the biggest expense for most American families. Are those dollars getting spent wisely? |
| Outside the Box: This quant pro and card counter says gambling can make you a better investorEdward Thorp, who pioneered the use of quantitative investment techniques, reminds Tren Griffin of that other ultra-rational decision-maker, Charlie Munger. |
| Outside the Box: Investors are underestimating the core part of Nvidia’s businessGamers are switching to PCs from consoles, and that could be a huge boost for Nvidia’s bread-and-butter business, writes Ben Bajarin. |
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