15May2018 Market Close: Wall Street Slides On Inflation Fears, Trade Jitters, DOW Down Almost 200 Points, Gasoline Prices A Threat, WTI Settles In The 71 Handle

Written by Gary

US retail sales increased marginally, but US equities ended lower today (SPY -0.7%). Consumer spending appeared on track to accelerate after slowing sharply.

Todays S&P 500 Chart

The Market in Perspective

Here are the headlines moving the markets.
	Wall St. slides on inflation fears, trade jitters (Reuters) – A surge in U.S. government bond yields to their highest level in almost 7 years sent Wall Street shares sliding on Tuesday after strong retail sales data stoked inflation concerns and investors fretted about looming trade talks between the United States and China.
	Twitter changes strategy in battle against internet ‘trolls’ SAN FRANCISCO (Reuters) – Twitter Inc on Tuesday revised its strategy for fighting abusive internet “trolls,” saying it would use behavioral signals to identify harassers on the social network and then limit the visibility of their tweets.
	Tesla plans six-day stoppage at factory for assembly line fixes: sources SAN FRANCISCO (Reuters) – Tesla Inc will pause production at its California factory for six days at the end of the May to work on fixes to its assembly line for its new Model 3 sedan, sources inside the company told Reuters.
	Maduro rebukes Kellogg for leaving Venezuela, gives unit to workers CARACAS/VALENCIA (Reuters) – Venezuelan President Nicolas Maduro blasted U.S.-based cereal maker Kellogg Co on Tuesday for pulling out of the country due to the economic crisis and vowed to hand over the company’s factory to workers.
	Exclusive: China’s Tianqi nears $4.3 billion deal to buy stake in Chile’s SQM – sources HONG KONG/TORONTO (Reuters) – China’s Tianqi Lithium is nearing a deal to buy a 24 percent stake in Chile’s Sociedad Quimica Y Minera (SQM) , one of the world’s biggest lithium producers, for about $4.3 billion, two people close to the transaction said.
	U.S. consumer spending picking up, gasoline prices a threat WASHINGTON (Reuters) – U.S. retail sales increased marginally in April as rising gasoline prices cut into discretionary spending, but consumer spending appeared on track to accelerate after slowing sharply in the first quarter.
	Uber, Lyft scrap mandatory arbitration for sexual assault claims (Reuters) – Ride-hailing companies Uber Technologies Inc [UBER.UL] and Lyft Inc scrapped mandatory arbitration to settle sexual harassment or assault claims, giving victims several options to pursue their claims including public lawsuits.
	Facebook says posts with graphic violence rose in early 2018 MENLO PARK, Calif. (Reuters) – The number of posts on Facebook showing graphic violence rose in the first three months of the year from a quarter earlier, possibly driven by the war in Syria, the social network said on Tuesday, in its first public release of such data.
	Mexico says NAFTA deal unlikely this week, signing possible this year MEXICO CITY (Reuters) – Mexico’s economy minister said on Tuesday that he saw diminishing chances for a new North American Free Trade Agreement ahead of a May 17 deadline to present a deal that could be signed by the current U.S. Congress.
	Bonds & Bullion Bloodbath As Dow Dumps Into Red For 2018 Someone ask Bob Pisani if the bears are back in charge of the narrative? Stocks were ‘triggered’ by retail sales data this morning… And despite some roller-coastering, stocks largely trod water from the gap down open… Dow (and Transports) tumbled into the red for 2018…
	The Most Underappreciated Story In The Oil Market Authored by Tsvetana Paraskova via OilPrice.com, The world is currently watching the growing tensions in the Middle East, and oil market analysts are guesstimating just how much Iranian oil supply the renewed U.S. sanctions could stifle. Yet, the biggest story in oil markets this year may well take place far from the much-publicized tensions in the Middle East – namely China’s ever-growing oil demand. The key oil demand growth center – China – has just beaten its own imports and refinery runs records, as refined oil product exports jump and domestic crude oil production hits seven-year-lows. While all eyes are riveted on Iran and the Middle East, the pace of Chinese oil demand growth could be the most underappreciated story in oil markets right now, Bloomberg Opinion columnist David Fickling writes. China’s oil demand growth has so far this year exceeded expectations, and Goldman Sachs, for example,
	Here Comes The Hangover: Consumer Loan Demand Plunges As Interest Rates Spike How do you know an economy is growing? To answer that question fully would require for more time than most attention-deficit disorder afflicted readers can dedicate to an article here, as there are simply too many indicators to mention, some objective, others less so, but there is one clear cut sign confirming an economy is not growing: if the consumers in said economy have no demand for loans – an indicator of stagnation and/or disinflation – or worse, are actively deleveraging their existing debt exposure, a precursor to outright deflation and money destruction, the bane of every central bank. Well, if one uses the “exclusion” indicator, the US has a very big problem. Following the passage of tax reform in late 2017, the previous Fed Senior Loan Officer Survey released three months ago noted a meaningful pick-up in loan demand. Then, according to the Fed’s weekly H.8 data on bank balance sheets, this rising oan demand spurred acceleration in actual bank C&I lending for the first time since the general elections in the last part of 2016 (recall that on several occasions in 2017, loan demand was on the verge of going negative Y/Y, traditionally a leading recession indicator).
	The Stock & Bond Markets Have Not Disagreed This Much Since 2008 While the yield curve has steepened the last two days, the recent relationship with stocks is holding up as the almost unprecedented negative correlation is confirmed by weakness in stocks… And that has driven the correlation between stocks and the yield curve to its most negative since October 2008… This short-term negative correlation means simply that the stock market’s view of inflation and growth the most ‘positive’ relative to the extreme ‘negative’ view of future inflation and growth of the bond market. This broad death cross of rationality has existed fo …
	Trump’s ZTE Deal Is No U.S. Win The West’s main argument against Chinese trade practices has always been that it applies rules selectively and unfairly to achieve mercantilist aims. Now the U.S. is doing the same.
	Why Buy Volkswagen When You Can Get Porsche for Less? The key court case in the decade-old Porsche-Volkswagen takeover saga is due to restart in June, reviving the case for buying discounted Porsche stock.
	Investors May Be the Losers in CBS-Redstone Feud By trying to end Redstone’s control of CBS, the company’s board may be right but may ultimately end up with a worse deal.
	April 2018 Sea Container Exports Strengthen Written by Steven Hansen The April month-over-month export counts were much stronger than last month and the year-to-date exports are up 4.6 %.
	Market Extra: Bonds, stocks and gold all falling at the same time means there is almost nowhere to hide There was nearly nowhere to hide for investors on Tuesday, with a selloff in stocks failing to lift traditional havens.
	Mark Hulbert: Here’s how you’ll know when this bull market is just about done Look out below if investors become stubbornly optimistic about stocks, writes Mark Hulbert.
	Futures Movers: Oil climbs on Middle East unrest, with Brent notching another multiyear high Oil settles higher Tuesday, with supply concerns tied to political unrest in the Middle East lifting global benchmark crude to its highest finish in 3½ years.