27Apr2018 Midday Update: Wall Street Can’t Make Up It Mind As Markets Swing Between Positive And Negative At The Unchanged Line, US Economy Slows, Consumers Put Off Spending

Here is the current market situation from CNN Money

North and South American markets are higher today with shares in Brazil leading the region. The Bovespa is up 0.18% while U.S.’s S&P 500 is up 0.06% and Mexico’s IPC is up 0.04%.

Amazon, Microsoft boost Nasdaq; Exxon drags on S&P

(Reuters) – Amazon and Microsoft pushed the Nasdaq higher on Friday, but weak reports from Exxon and other energy companies capped gains on the S&P 500 and the Dow Jones Industrial index.

Exclusive: U.S. considers tightening grip on China ties to corporate America

NEW YORK (Reuters) – The U.S. government may start scrutinizing informal partnerships between American and Chinese companies in the field of artificial intelligence, threatening practices that have long been considered garden variety development work for technology companies, sources familiar with the discussions said.

U.S. economy slows in first quarter as consumer spending brakes sharply

WASHINGTON, April 27 (Reuters) – The U.S. economy slowed in the first quarter as consumer spending grew at its weakest pace in nearly five years, but the setback is likely temporary against the backdrop of a tightening labor market and large fiscal stimulus.

USTR criticizes 36 nations over IP protection, scrutinizes Canada

WASHINGTON (Reuters) – The United States on Friday labeled 36 countries as inadequately protecting U.S. intellectual property rights, keeping China on its “Priority Watch List” for the 14th straight year and adding Canada and Colombia to that list for extra scrutiny.

T-Mobile, Sprint finalizing merger terms: sources

(Reuters) – U.S. wireless carriers T-Mobile US Inc and Sprint Corp are finalizing terms as they seek to sign a merger deal in the next three days, people familiar with the matter said on Friday.

Refining margins dent Exxon, Chevron first-quarter results

HOUSTON (Reuters) – Weak refining margins dinged first-quarter results for Exxon Mobil Corp and Chevron Corp , though Chevron’s oil production gains outshone its larger rival, which has struggled to turn operations around after recent missteps. Refining and chemical operations hurt two of the world’s largest integrated energy companies for the second consecutive quarter, highlighting concerns about the impact of volatile oil prices on their businesses.

Tech gains, Korean vibes lift world stock markets; sterling tumbles

LONDON (Reuters) – World stocks rose on Friday, lifted by strong share price gains for tech giants such as Amazon and Facebook and growing hopes of a lasting peace on the Korean peninsula after a ground-breaking meeting of North and South Korean leaders.

Prime hike gives Amazon warchest for fight over postal costs

(Reuters) – Amazon.com Inc’s 20 percent hike in the cost of Prime membership should deliver more than $1 billion in extra revenue this year and cover any “rational” hike in United States Postal Service delivery fees, Wall Street analysts said on Friday.

Jeffrey Ubben steps down from Fox board

(Reuters) – Twenty-First Century Fox Inc said on Friday, Jeffrey Ubben has stepped down from the company’s board at a time when the media company is in the process of completing a deal with Walt Disney Co .

The Blowback Against Facebook, Google And Amazon Is Just Beginning

Authored by Charles Hugh Smith via OfTwoMinds blog

Blow-out earnings from Facebook and Amazon have cheered Wall Street, but institutional owners might want to focus not just on blow-out earnings but rising blowback against the tech superpowers (Facebook, Google and Amazon).

The blowback is social and political: people are starting to question the social and political costs of these tech darlings’ dominance and the billions in profits they reap.

The typical corporation can buy political influence, but Facebook and Google are manipulating the machinery of democracy itself. That’s a much more dangerous type of power than buying political influence or manipulating public opinion by openly publishing biased “news.”

We all understand how Corporate Media undermines democracy: recall how every time Bernie Sanders won a Democratic primary in 2016, The New York Times and The Washington Post “reported” the news in small typeface in a sidebar, while every Hillary Clinton primary win was trumpeted in large headlines at the top of page one.

But this sort of manipulation is visible; what Google and Facebook do is invisible. I recently addressed these invisible (but oh-so profitable) mechanisms in a series of essays:

How Far Down the Big Data/’Psychographic Microtargeting’ Rabbit Hole Do You Want to Go”

Is Profit-Maximizing Data-Mining Undermining Democracy?

Should Facebook, Google and Twitter Be Public Utilities”

Deripaska Agrees To Resign From Rusal, Will Sell Controlling Stake

Just 24 hours ago, Bloomberg reported that “Oleg Deripaska Plans on Keeping Control of Rusal”, a move which suggested that the Russian oligarch would remain defiant in face of US demands that he sell his stake and/or step down as head of United Co. Rusal – the world’s biggest aluminum producer outside of China – even as the Russian aluminum giant battles for survival having lost capital markets access following the snactions.

Or maybe not: overnight we got a first indication that Bloomberg’s report was incorrect when Rusal published a Facebook post denying the Bloomberg claim that Deripaska was intent on keeping control over Rusal, and threatened to take “legal action”

And then, moments ago, we got definitive confirmation when EN+, which holds a controlling stake in Rusia, announced that Deripaska had in fact agreed “in principle” to cut his stake in EN+ to below 50%, and that the sanctioned Russian billionaire had agreed with the proposal that he will resign from board.

As EN+ also adds, the company is seeking an urgent response to the formal request submitted to OFAC, and no …

BofA: “A Deer In The Headlights” Market Moment

Looking at the latest fund flow data from EPFR, BofA CIO Mike Hartnett describes the most recent developments in capital flows with 4 ominous words: “deer in the headlights.” He is referring to the unexpected risk-off investor sentiment in the past week, a continuation of last week’s theme, which saw $2.8bn inflow to bonds, $0.9bn inflow to gold, while flows to equities remained unchanged.

Taking a closer look at equity flows, Hartnett notes the collapse in stock “froth” which following massive 2018 inflows of $150bn in the first 2 months of the year, has reversed and equity redemptions have surged to $30bn in the past 6 weeks.

Further narrowing the number down, there was 3% outflows, or the biggest outflows in 3 months, from tech, couped with the biggest HY outflows in 2 months, and biggest EM debt outflows in 10 weeks. In other words, a sudden risk aversion to the highest beta risk-on products and sectors.

Still, it’s too early perhaps to call a top as the 9-year bull leadership intact: flows into tech & EM debt/equity funds nonetheless close to record highs; in fact, only HY funds have seen “bear market” in flows.

The Next Crash: Making The Fed An Instrument For Disaster

Submitted by Nomi Prins

Warning: What you are about to read is not about Russia, the 2016 election, or the latest person to depart from the White House in a storm of tweets. It’s the Beltway story hiding in plain sight with trillions of dollars in play and an economy to commandeer.

* * *

While we’ve been bombarded with a litany of scandals from the Oval Office and the Trump family, there’s a crucial institution in Washington that few in the media seem to be paying attention to, even as President Trump quietly makes it his own. More obscure than the chambers of the Supreme Court, it’s a place where he has already made substantial changes. I’m talking about the Federal Reserve.

As the central bank of the United States, the “Fed” sets the financial tone for the global economy by manipulating interest rate levels. This impacts everyone, yet very few grasp the scope of its influence.

During times of relative economic calm, the Fed is regularly forgotten. But what history shows us is that having leaders who are primed to neglect Wall Street’s misdoings often sets the scene for economic dangers to come. That’s why nominees to the Fed are so crucial.

We have entered a landmark moment: no president since Woodrow Wilson (during whose administration the Federal Reserve was established) will have appointed as many board members to the Fed as Donald Trump. His fingerprints will, in other words, not just be on Supreme Court decisions, but no less significantly Fed policy-making for years to come — even though, like that court, it occupies a mandated position of political independence.

The president’s latest two nominees to that institution’s Board of Governors exemplify this. He has nominated Richard Clarida, a former Treasury Department official from th …

The News Is Good for Baidu

China’s search-engine giant has found a way to make its users stick around: tailored news content generated by artificial intelligence.

The U.S.-China Policy Divergence Is—Again—Key to Markets

The People’s Bank of China and the Federal Reserve are moving in opposite directions. The last time that happened, it created substantial stress for China’s financial system. Will things be different this time around?

Norwegian Air’s Disruptive Days Look Numbered

The latest company to champion low-cost trans-Atlantic flights either needs to rein in its ambition or sell out.

Trump Today: President says Americans should be proud Korean War is ending

President Donald Trump tweeted Friday that the Korean War will end after a historic meeting between the leaders of North and South Korea, as he praised China’s president for his Korea diplomacy and welcomed German Chancellor Angela Merkel to the White House.

Is Amazon a fundamentally unfair company? It certainly looks that way

The company’s losses in its retail business force rivals down the same road, says Thomas H. Kee Jr.

The Ratings Game: Intel just posted a huge quarter, but can the momentum last?

Intel reported huge earnings and revenue beats on Thursday afternoon, but analysts are concerned about the sustainability of these numbers as well as company commentary on the 10-nanometer ramp.