19Feb2019 Midday Update: Wall Street Looks To Next Round Of Trade Talks, US Stocks Seaking Direction, DOW Up 27 Points, WTI Slips To 55.92

Here is the current market situation from CNN Money

North and South American markets are mixed today. The Bovespa is up 1.51% while the S&P 500 gains 0.21%. The IPC is off 0.28%.

Google to buy data migration company Alooma in cloud push

Alphabet Inc’s Google said on Tuesday it will buy data migration company Alooma, as part of efforts to catch up with bigger cloud service rivals Amazon.com Inc and Microsoft Corp.

Strong U.S. economy boosts Walmart holiday-quarter sales, shares gain

A strong U.S. economy boosted Walmart Inc’s holiday-quarter sales growth to the best in a decade, lifted by consumer spending in key categories like groceries and increased e-commerce purchases.

Netflix Toronto production hub to create 1,850 jobs annually

Netflix Inc said on Tuesday it is creating a production hub with two studios in Toronto that is expected to create 1,850 jobs per year.

JD Sports raises its stake in Footasylum to more than 18 percent

Footasylum Plc said on Tuesday its larger rival JD Sports Fashion Plc has increased its stake in the company to more than 18 percent.

Appaloosa’s Tepper says Allergan should consider selling itself

Billionaire hedge fund manager David Tepper stepped up pressure on Allergan Plc and said on Tuesday the drugmaker should consider selling itself if management is unable to turn around recent lagging performance.

Wall St. flat as Walmart offsets bank losses; trade talks eyed

U.S. stocks struggled for direction on Tuesday as gains in Walmart offset losses in financials, with trade talks between the United States and China in focus.

Honda to close British car plant as Brexit looms

Honda will close its only British car plant in 2021 with the loss of up to 3,500 jobs, a major departure of Japanese investment announced just over a month before the United Kingdom is due to leave the European Union.

Medtronic quarterly profit beats on strength in surgical products

Medtronic Plc beat analysts’ estimates for quarterly profit on Tuesday, boosted by sales of its surgical products, and the largest U.S. standalone medical device maker raised the upper end of its full-year earnings forecast.

BAE Systems wins funding from U.S. Army to start production of new armored vehicles

Britain’s defense company BAE Systems on Tuesday said it had won additional funding up to $575 million from the U.S. Army to begin production of its new armored vehicles that would replace the Vietnam War-era M113 fleet of personnel carriers.

HSBC Made $120 Million In One Day As Turkish Lira Imploded

Countless Japanese amateur FX traders and Mrs. Watanabes were crushed last summer when the Turkish lira, one of Japan’s favorite FX pairs, tumbled in an accelerating avalanche following a sharp deterioration in the Turkish economy and a major deterioration in US-Turkish relations over the ongoing arrest of Pastor Brunson which resulted in brief US tariffs. Yet while the losers were known, the big winners remained under the radar.

Until now. As part of its (disappointing) earnings results, HSBC reported that it made about $120 million in a single day during Turkey’s financial crisis as it profited from the collapse of the lira, Bloomberg noted.

So while the the Lira collapse over the summer hit trading profits for not only Mrs Watanabe and some investment banks such as Barclays, HSBC was conveniently on the other side, and benefited generously from the fall in the Turkish currency value.

According to HSBC filings, the outsized gains “driven by volatility in Turkish lira spot” were more than twice as big as predicted by HSBC’s market risk models, with the bank adding that this profit was the biggest of three exceptions it found when it back-tested its model against actual gains and losses for the year.

As Bloomberg notes …

Big Trouble in China Housing: Government Bans “Malicious” Price Cuts

Submitted by Investing In Chinese Stocks

Pizhou, Fujian has a solution to falling home prices: ban them. They’re not alone in using this strategy. Other cities have told developers to reverse price cuts and one went so far as to punish a developer’s creditors.

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On the finite price, the price can not rise. And the property market environment is so cold, the price of the house is not good to sell. It is not easy to cut prices. After the new term “price reduction attempt” was born, a new word appeared in Zhangzhou City, Jiangsu Province, “malicious price cuts.”

This is really an anecdote. Developers who have such a big hatred, do you have to carry “malicious” to cut prices? Who is going to be malicious?

A developer was warned about cutting prices to move inventory:

At the beginning of February 2018, the Real Estate Chamber of Commerce of Zhangzhou City, Jiangsu Province issued a “Circular on the recent sales chaos in the real estate market in Zhangzhou”, which was circulated on the Internet. It has attracted many onlookers.

The announcement states:

There are some properties in Zhangzhou that have disrupted the market with low prices and unfair competition. The sales price is seriously lower than the filing price. The individual properties have dropped by 2,000 yuan/square meter. This kind of behavior has seriously disrupted the order of the real estate market.

The Zhangzhou Real Estate Chamber of Commerce requires housing companies to sell according to the record price, and must not provoke a price war.

Neither the public nor the developer …

Market Juggernaut: Stock Breadth Hits All Time High

Back in December, when the S&P was breaking down and taking out every support level, the financial press was flooded with cheesy headlines warning of “bad breadth” as decliners steamrolled advancers.

What a difference two months makes, because with the largest stock market in the world – the $30 trillion NYSE Composite – having recently broken above its 200DMA if finding some resistance near the level where the last three break outs failed as the NYSE hit the dreaded Triple Top (as a reminder, there is no such thing as a Quadruple Top)…

… it is time to roll out the Mentos, i.e., “good breadth” commercials, because as of Friday’s close, Bloomberg notes that NYSE company breadth – advancing stocks over than declining – just hit a record, joining the S&P 500 cumulative advance-decline line and NYSE Composite A-D line at new highs.

“There Is No Way The US Can Crush” Huawei, Founder Says

In his second interview with a western media outlet in as many months, the typically reclusive Huawei founder Ren Zhengfei shared his thoughts on the US’s crackdown on the company he built, the charges against his daughter (Huawei CFO Meng Wanzhou) and allegations about the company’s ties to China’s state security apparatus.

Ren Zhengfei

When it comes to the US’s campaign to convince its western partners to outlaw or discourage the use of Huawei equipment – a campaign that has so far met with mixed success, as foreign telecoms companies have been forced to reckon with the reality of just how dependent they are on Huawei’s technology – Zhengfei pointed out that America only represents a small portion of its business, and no matter what Washington does, the fallout can only be so bad.

“If the lights go out in the West, the East will still shine. And if the North goes dark, there is still the South. America …

Cryptos: Bitcoin trades at 5-1/2 week high near $4,000

Bitcoin prices moved higher on Tuesday, extending the hot streak, which has seen the best-known cryptocurrency log four successive winning sessions reaching its highest level in nearly six weeks.

Economic Report: Home builder confidence jumps in February to four-month high

A measure of home builder sentiment jumped much more than expected, another signal that the 2018 slowdown in housing may have been temporary.

Earnings Watch: Walmart goes all in on digital in battle with Amazon

Walmart Inc.’s investments in e-commerce seem to be yielding top-line results. The next hurdle is generating a real profit.