Written by Gary
The trend for the major US stock indexes was down from the mornings opening (SPY -3.01%). DOW erases gains for the year, tumbling 608 points.
The Market in Perspective
| Here are the headlines moving the markets. | |
 | New York sues Exxon for misleading investors on climate change riskNew York’s attorney general sued Exxon Mobil Corp on Wednesday, alleging that the world’s largest oil company for years misled investors about the risks of climate change regulations on its business. |
| U.S. consumer watchdog dilutes penalty against payday lender: sourcesMick Mulvaney, the head of the U.S. Consumer Financial Protection Bureau (CFPB) on Wednesday fined a payday lender $200,000 for wrongly hounding borrowers but the penalty fell short of the $3 million his predecessor was seeking, said three sources familiar with the move. |
| Stocks fall on global worries while Treasuries riseStock markets around the world were lower on Wednesday while U.S. Treasuries prices rose as investors favored safer bets due to global economic and political fears, while the U.S. dollar surged and oil prices steadied after the previous day’s session. |
| U.S. tech funds turn to Visa, Paypal as FANGs fadeSome tech-heavy U.S. fund managers have turned to the once-stodgy payments sector as an alternative to so-called FANG stocks as high-flyers like Facebook Inc and Google parent Alphabet Inc falter. |
| Wall St. falls with chipmakers; housing data also a worryU.S. stocks fell on Wednesday, with the S&P 500 on track for a sixth day of losses, as weak forecasts from chipmakers added to concerns over the impact on earnings from tariffs and China’s slowdown. |
| Airbus chief says A321 weighing on delivery delaysAirbus planemaking chief Guillaume Faury confirmed on Wednesday that new variants of the A321neo passenger jet had contributed to delivery delays at a plant in Hamburg, Germany, but said engineers were in the midst of resolving the problem. |
| Southeast Asia’s Grab inks prepaid card deal with MastercardSingapore-based Grab has partnered payments processor Mastercard Inc to issue prepaid cards tailored to Southeast Asian consumers, extending the use of Grab’s digital wallet and helping its unbanked users transact online. |
| Italian watchdog fines Apple, Samsung over software updatesItaly’s anti-trust watchdog said on Wednesday it was fining Apple Inc and Samsung Electronics Co Ltd 5 million euros ($5.7 million) each following complaints they used software updates to slow down their mobile phones. |
| Odebrecht offered Mexico $18 million to resolve graft cases: documentMexico this year rejected an offer by Brazilian construction firm Odebrecht SA [ODBES.UL] to pay $18 million and supply information related to graft cases, according to a document and a person with knowledge of the matter, the conglomerate’s latest attempt to move past a major regional corruption scandal. |
| Markets In Turmoil: S&P, Dow Erase 2018 Gains As Momo Massacre AcceleratesNot a fleshwound anymore… China started off excitedly but the afternoon session saw selling pressure into the close…
Spain caught Italy’s flu and Europe caught German banking system’s cold…
And Deutsche Bank closed at a record low… |
| Over Half Of America Gets More In Welfare Than It Pays In TaxesAuthored by Ryan McMaken via The Mises Institute, More than half of Americans receive more money in various types of government transfer payments (Medicare, Medicaid, food stamps, Social Security) than they pay in federal taxes.
According to a report released this year by the Congressional Budget Office, only the top two income quintiles in the United States pay more in taxes than they receive in government transfers. Not surprisingly, the lowest income quintiles receive far more in transfers than they pay in taxes: |
| Morgan Stanley: “Buy The Dip” Is DeadBy Chris Metli, Executive Director in Morgan Stanley’s Institutional Equity Division Buying the dip has been the right trade for so long that it has become ingrained in investors’ psyche. Ample liquidity in the QE era provided the ammunition, and with robust earnings growth investors learned that selling into a downturn was the wrong trade, particularly during 2016 and 2017 (think the Brexit and US election selloffs and sharp rebounds). Even corporates have learned to buy the dips.
The problem is that the world is changing, and the environment is shifting from one where dips should be bought to one where rallies should be sold. 1) QE has ended and global central banks are withdrawing liquidity, 2) earnings growth is set to slow from recent tax-cut fueled highs, and 3) poor performance and volatility is limiting risk appetite – as portfolios are whipsawed investors will slowly learn that dips are no longer meant to be bought. Price action in 2018 already shows that ‘buy the dip’ is on its way out. Buying the S&P 500 after a down week was a profitable strategy from 2005 through 2017, and buying these dips fueled most of the post-crisis S&P 500 … |
| Former Fed Chair Slams Fed’s “Dangerous, False Precision” Over 2% Inflation TargetAuthored by Paul Volcker, op-ed via Bloomberg.com, False precision can lead to dangerous policies.
In 1996, Federal Reserve Chairman Alan Greenspan had an exchange with Janet Yellen, then a member of the Fed’s Board of Governors, that presaged a major – and, I think, ill-advised – change in the central bank’s approach to managing the economy.
Since then, under the chairmanship of Ben Bernanke and then under Yellen, Alan’s general principle — to me entirely appropriate — has been translated into a number: 2 percent. And more recently, a remarkable consensus has developed among central bankers tha … |
| Goldilocks Economy Could Be a Bear for StocksThe environment that the Federal Reserve envisions for the economy wouldn’t be all that friendly for stocks. |
| Don’t Bid on eBay Just YetPayPal results suggest eBay’s recent marketplace growth spurt may be short lived. |
| Eurozone Squabbles Are a Problem for Stocks, Not BondsNews of the eurozone’s demise is exaggerated, but that may not offer much comfort to stock investors. |
| Trump Today: President calls for unity after suspicious packages sent to Obama, ClintonPresident Donald Trump condemned political violence on Wednesday, after suspicious packages were sent to former President Barack Obama, Hillary Clinton and CNN as well as other individuals. |
| New York state sues Exxon Mobil for deceiving investors on climate-regulation riskNew York Attorney General Barbara Underwood has filed a lawsuit against energy giant Exxon Mobil Corp., alleging that it misled investors about the true risks to its business posed by climate-change regulations. |
| More than one-third of homeowners are paying for renovations with credit cardsA new study shows that the share of American homeowners paying for home improvement projects and products with credit cards has risen each year since 2011, and now tops 36%. |
Summary of Economic Releases this Week
Earnings Summary for Today
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