Soaring U.S Equities Push Asian Shares Cautiously Higher; Dollar Mixed

Wall Street rallied overnight as traders ignored some very obvious discord on the path of from the , concentrating on sparkling results from big-box retailer Target (NYSE:), and home improvement retailer Lowe’s (NYSE:). Both produced sparkling results following on from Walmart (NYSE:) last week and saw their shares jump massively in New York trading. The U.S. for July came in above expectations at 2.50% as mortgage rates tracked lower.

Internationally, Thailand’s staged a recovery yesterday, rising 4.28% y/y for July and even Argentina had a pleasant surprise for everyone. Its balance of payments rose to $951 million against a consensus of $684 million.

The only blot on the copybook was the Congressional Budget Office raising its forecast for the U.S. Government deficit to a mind-boggling $960 billion, which in all fairness, President Trump said was going to be the case anyway. I can understand why he wants rates lower for longer now, although I don’t know where he would have squeezed in the necessary dollars to buy Greenland.

Circling back to the Federal Reserve, it is clear that Corporate America is coping with trade tensions for now and that the mighty American consumer is still spending. The U.S. has a yield curve that actually pays interest thanks to partial interest rate normalization. It leaves the Fed with monetary wiggle room should it be required, leaving it in a group of about one internationally.

Whether to potentially squander this advantage, by engaging in an easing cycle too soon and when it isn’t necessary, quite likely explains the fractious nature of the minutes of last FOMC meeting. Two governors wanted a 50 bps cut, two didn’t want a cut at all, and the rest settled on 25 bps with the emphasis it was a mid-cycle adjustment not the start of a new

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Wall Street Target’s Lowe-hanging fruit

Prepared by Jeff Halley, Senior Market Analyst

Wall Street rallied overnight as traders ignored some very obvious discord on the path of rate cuts from the FOMC Minutes, concentrating on sparkling results from big-box retailer Target, and home improvement retailer Lowe. Both produced sparkling results following on from Walmart last week and saw their shares jump massively in New York trading. The U.S. existing home sales for July came in above expectations at 2.50% as mortgage rates tracked lower.

Internationally, Thailand’s exports staged a recovery yesterday, rising 4.28% y/y for July and even Argentina had a pleasant surprise for everyone. Its balance of payments rose to $951 million against a consensus of $684 million.

The only blot on the copybook was the Congressional Budget Office raising its forecast for the U.S. Government deficit to a mind-boggling $960 billion, which in all fairness, President Trump said was going to be the case anyway. I can understand why he wants rates lower for longer now, although I don’t know where he would have squeezed in the necessary dollars to buy Greenland.

Circling back to the Federal Reserve, it is clear that Corporate America is coping with trade tensions for now and that the mighty American consumer is still spending. The U.S. has a yield curve that actually pays interest thanks to partial interest rate normalisation. It leaves the Fed with monetary wiggle room should it be required, leaving it in a group of about one internationally.

Whether to potentially squander this advantage, by engaging in an easing cycle too soon and when it isn’t necessary, quite likely explains the fractious nature of the minutes of last FOMC meeting. Two governors wanted a 50 bps, two didn’t want a cut at all, and the rest settled on 25 bps with the emphasis it

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Bank Of Nova Scotia Buys SPDR S&P 500 ETF Trust, iShares Core MSCI Emerging Markets ETF, iShares J.P. Morgan USD Emerging Markets Bond ETF, Sells iShares MSCI EMU ETF, iShares MSCI Emerging Markets ETF, TC Energy Corp

Toronto, A6, based Investment company Bank Of Nova Scotia (Current Portfolio) buys SPDR S&P 500 ETF Trust, iShares Core MSCI Emerging Markets ETF, iShares J.P. Morgan USD Emerging Markets Bond ETF, iShares MSCI Germany ETF, SPDR Gold Trust, sells iShares MSCI EMU ETF, iShares MSCI Emerging Markets ETF, TC Energy Corp, iShares North American Tech-Software ETF, First Trust Dow Jones Internet Index Fund during the 3-months ended 2019Q2, according to the most recent filings of the investment company, Bank Of Nova Scotia . As of 2019Q2, Bank Of Nova Scotia owns 804 stocks with a total value of $23.7 billion. These are the details of the buys and sells.

New Purchases: VNQ, SAN, AEPPB, IYK, HYG, GSY, DLS, DGRW, AMCR, CTVA, FOXA, TME, MFGP, CYBR, YNDX, KL, HBM, OMAB, BRFS, MKTX, IBN, DO, CTRP, BIDU, AIV, Added Positions: SPY, IEMG, EMB, EWG, GLD, EWQ, AAXJ, AMZN, BCE, BAP, GOOGL, MCHI, XLE, VZ, SU, WFC, GOOG, CNQ, IHI, ECA, NTR, BMO, LLY, TECK, CGC, MO, BRK.B, BA, CAE, COP, RCI, TU, UNM, PM, BAC, CM, CSCO, DVN, KSS, MCD, NKE, PXD, BKNG, ABBV, DELL, EWZ, ADBE, CVS, CTSH, IMO, INTC, INTU, MGA, OXY, BB, SLB, UNH, VLO, AVGO, PBA, SHV, MMM, A, ADM, BK, BMY, CCJ, CELG, CNP, CVX, ETFC, EOG, EXC, XOM, FL, FCX, HAL, ISRG, JNJ, LOW, MU, NVDA, NFLX, PTEN, RTN, REGN, RHI, CRM, SJR, STLD, SYMC, TAC, UPS, ANTM, VET, CVE, KMI, PBF, NTNX, VST, EFA, XBI, AES, ABMD, AAP, AMG, ALK, ALB, ALGN, ADS, ALNY, AMT, IVZ, APA, ARW, BP, BNS, BDX, BHC, BXP, BC, CHRW, COG, CAH, CCL, CAT, CTL, CRL, SCHW, CHL, CI, XEC, CTXS, CLX, TPR, BVN, DXC, CAG, INGR, CR, D, DUK, EW, ERF, EQIX, RE, FFIV, NEE, FAST, FDX, FRT, M, FLR, GPS, GRMN, GPC, HP, HRL, HST, IR, IRM, TRQ,

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Stocks rise with focus on stimulus; US yield curve briefly inverts

Traders expect that the Fed’s annual Jackson Hole, Wyoming, symposium and a Group of Seven summit this weekend will shed light on the next steps policymakers will take to support economic growth. — Reuters pic

NEW YORK, Aug 22 — A global equities gauge rose yesterday for a third day in four as bets on more economic stimulus overcame, for now, worries over the rising prospect of a global recession.

The brief inversion of the curve between 2-year and 10-year US Treasury yields loomed, however, as it is seen as a harbinger for an economic contraction. The curve has at some point inverted in four of the past six sessions.

Strong earnings in the United States and the report of talks on a megamerger in European autos triggered gains in stocks, and the improved risk sentiment drove safe-haven yields higher while the yen and gold edged lower.

There was muted reaction across markets to minutes from the Federal Reserve’s meeting late last month. Policymakers debated lowering interest rates more aggressively than the quarter-point cut last month, while showing broad concern over a global economic slowdown and trade tensions.

The trade war escalated further after that Fed meeting, and investors were cautious about the current validity of policymakers’ comments.

“It’s really old news. This is from the July meeting and what (Fed Chairman Jerome) Powell has to say on Friday is going to be much, much more important than these minutes,” said Mary Ann Hurley, vice president in fixed-income trading at D.A. Davidson in Seattle.

Traders expect that the Fed’s annual Jackson Hole, Wyoming, symposium and a Group of Seven summit this weekend will shed light on the next steps policymakers will take to support economic growth.

Auto shares led European stocks higher after Italian media suggested the merger talks between

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Bursa Malaysia opens higher on improving global sentiment

KUALA LUMPUR: Bursa Malaysia rebounded to open higher today tracking overnight gains of global indices as the latest data shows retail purchasing in the US remains in positive territory.

At 9.05am, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) gained 2.09 points to 1,596.68, after adding 1.67 at the opening from yesterday’s close of 1,594.59.

On the broader market, gainers led losers 130 to 63, while 167 counters unchanged, 1,599 untraded and 14 others suspended.

Turnover stood at 81.29 million units worth RM40.46 million.

Malacca Securities Sdn Bhd said, as the global equities continue to make amends, it will be difficult to ignore the positivity with Malaysian equities are already due for a near term rebound.

“While we think the improvements in the global market environment could aid the overdue rebound, the recovery could be measured due to the lack of fresh buying impetuses,“ it said in is equity note today.

It also said that the current market conditions have slightly changed from its cautious state due to the ongoing trade disputes and growing fears of a slowing global economy, to a calmer pace.

“As of now, the 1,600 points level will be the immediate hurdle, followed by the 1,610 level. The 1,590 level is still the near term support, followed by the 1,580 level,“ it said.

Another analyst contended that the market was near-certain on another interest rate cut by the US Federal Reserve after yesterday’s meeting, with many understood that the rate cut is to further boost the economy amidst challenging global environment.

“Markets is expected to take this on the positive note, coupled with better retail purchasing data, which indicates that the market is not going to face a steep fall due to global uncertainty,“ she said to Bernama.

Global indices, Dow Jones Industrial Average gained 0.93%

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Turner’s Take Podcast: CBOT Likely To Put In A Seasonal Bottom Next Week

Turner’s Take Podcast: CBOT Likely To Put In A Seasonal Bottom Next Week
Wednesday, August 21, 2019

by Craig Turner of Daniels Trading

Play Turner’s Take Podcast Episode 196 If you are having trouble listening to the podcast, please click here for Turner’s Take Podcast episodes! New Podcast!

In our latest podcast we go over our thoughts on the macro economy and why we like gold, the stocks market and the US Dollar.  Then we talk about how grains typically make a seasonal low at the end of August and why we like the corn and soybeans in Sept/Oct.  Next up is livestock and how we want to play cattle and hogs.  Finally we talk about the reversal in crude oil calendar spreads and how we want to get involved.  Make sure you take a listen to this week’s Turner’s Take podcast!

Grains

Grains tend to make a seasonal bottom at the end of August as old crop needs to be sold to make way for new crop.  Production also has a good chance of being lower than what the USDA is currently forecasting.  I think the CBOT comes under pressure between now and First Notice Day (Aug 30).  After that the market will pay more attention to the possibility of a smaller crop and frost risk.  Below are my Supply and Demand scenarios for corn and soybeans based on various yield possibilities.

Livestock

Cattle has been taken to the shed ever since the Tyson plant caught fire in Garden City, KS.  Packer margins are incredibly profitable and everyone in the industry has an incentive to get fat cattle in the supply chain.  August and Oct cattle may have a tough time over the near term, but

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Dow Jones jumps 240 points on strong retail earnings and Fed minutes

Investor sentiment lifted on Wall Street after upbeat earnings from the large retailers signalled consumer demand is still strong in the United States.

That was despite last week’s recession signals from the bond market which triggered panic selling across global markets.

The Dow Jones index jumped 240 points, or 1 per cent, to 26,203.

The broader S&P 500 and tech-heavy Nasdaq indices lifted by 0.8 and 0.9 per cent respectively.

Target shares surged 20.4 per cent after the big-box retailer raised its annual earnings forecast, while Lowe’s climbed 10.2 per cent after the home-improvement chain reported a stronger-than-expected quarterly profit.

Market snapshot at 7:50am (AEST):ASX SPI futures +0.4pc at 6,466, ASX 200 (Wednesday’s close) -0.9pc at 6,483AUD: 67.84 US cents, 55.91 British pence, 61.16 euro cents, 72.3 Japanese yen, $NZ1.06US: Dow Jones +0.9pc at 26,203, S&P 500 +0.8pc at 2,924, Nasdaq +0.9pc at 8,020Europe: FTSE 100 +1.1pc at 7,204, DAX +1.3pc at 11,803, CAC +1.7pc at 5,435, Euro Stoxx 50 +1.3pc at 3,395Commodities: Brent crude +0.6pc at $US60.41/barrel, spot gold -0.3pc at $US1,502/ounce, iron ore -6.3pc at $US82.38/tonne Aggressive rate cut was considered

Markets in New York held onto most of their gains even after the Federal Reserve released the minutes of its July 30-31 meeting.

The US central bank cut rates by 25 basis points, for the first time in a decade, at the end of last month.

The minutes revealed that the Fed had debated cutting interest rates more aggressively at its last meeting due to concerns about a global economic slowdown, trade tensions and sluggish inflation.

However, the central bankers also wanted to avoid giving the impression that they were on a set path to announce more rate cuts.

“A couple of participants indicated that they would have preferred a 50 basis

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Tesla shares slide on news of Walmart suing over solar-panel fires

Shares of Tesla fell 2.2% to $220.83 on Wednesday after Walmart sued the electric car company’s energy division for fires allegedly stemming from solar panels.

Tesla’s stock went down as the broader market moved higher, with the Dow Jones Industrial Average up more than 300 points, or more than 1%, at one point.

In a lawsuit filed Tuesday in New York state court, Walmart alleged that Tesla solar panels installed atop seven of its stores had caught fire. Walmart is claiming breach of contract, gross negligence and failure to live up to industry standards.

“As of November 2018, no fewer than seven Walmart stores had experienced fires due to Tesla’s solar systems — including the four fires described above and three others that had occurred earlier,” the lawsuit says.

The retailer is asking the court to force Tesla to remove solar panels from more than 240 Walmart stores where they were installed, as well as pay damages related to all the fires. It didn’t specify a monetary amount.

Walmart alleged that Tesla “routinely deployed individuals to inspect the solar systems who lacked basic solar training and knowledge.”

The lawsuit has revived concerns about Tesla’s $2.6 billion acquisition of SolarCity in 2016. Walmart alleged in its claim that Tesla bought SolarCity to “bail out the flailing company” and mentions SolarCity 46 times throughout the lawsuit.

Tesla’s stock price has suffered, with shares down roughly 31% this year. CEO Elon Musk’s now-infamous tweet last August about taking the company private <a href="https://www.cnbc.com/2019/08/08/teslas-chaotic-year-after-musks-funding-secured-tweet.html" class

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ASIA MARKETS- Asian Markets Climb On China Stimulus Move, Trade-talks Optimism

Beijing announces plan to reform interest rates over the weekend

Asian shares climbed Monday, as investors embraced a move by China that could help lower borrowing rates for companies, and signals that trade talks between Washington and Beijing could be improving.

On Saturday, the People’s Bank of China unveiled a key interest rate reform aimed at lowering real interest rates for companies as the country faces a slowing economy. Last week’s data showed China’s economy slowed more sharply than expected in the third quarter.

While Trump on Sunday suggested no quick end to the trade war with China, some investors were encouraged after Trump said he spoke with Apple Chief Executive Tim Cook , who warned the president that tariffs could hurt his tech company by giving rivals like South Korea’s Samsung Electronics an edge. Trump said Cook made a “very compelling argument, so I’m thinking about it.”

Japan’s benchmark Nikkei 225 closed up 0.7%. Hong Kong’s Hang Seng gained 2.3% after a massive but peaceful pro-democracy march , while the Shanghai Composite added 3%. South Korea’s Kospi was 0.7% higher, and benchmark indexes in Taiwan , Singapore and Indonesia all rose. Australia’s S&P/ASX 200 closed up 0.9%.

Among individual stocks, convenience-store chain FamilyMart surged in Tokyo trading. SoftBank and Mitsubishi UFJ also rose. In Hong Kong, Sunny Optical gained, along with property developer Country Garden and casino operator Galaxy Entertainment . LG Electronics advanced in South Korea, while Taiwan Semiconductor rose in Taiwan. In Australia, Beach Energy surged, while Commonwealth Bank and ANZ Banking (ANZ.AU) rose as well.

On Friday, the S&P 500 rose 41.08 points, or 1.4%, to 2,888.68. The Dow , which had an 800-point drop earlier in the week, added 306.62 points, or 1.2%, to 25,886.01. The Nasdaq climbed 129.38 points, or 1.7%, to 7,895.99. Each index

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U.S. stocks climb after major retailers post solid earnings

Strong earnings reports from several big retailers helped drive stocks broadly higher on Wall Street Wednesday as the market bounced back from its first loss in four days.

Target notched its biggest-ever gain, while Lowe’s had its best day in more than a year, leading a broad rally in companies that rely on consumer spending. Nordstrom, Kohl’s, Gap and other retailers closed higher.

Technology companies accounted for a big share of the gains. Financial stocks rose as bond prices fell, pushing yields higher. Real estate and materials stocks lagged the rest of the market.

Investors have been worried that U.S. economic and corporate earnings growth could stumble under the strain of a slowing global economy and the costly trade war between the U.S. and China. But the strong quarterly results from the retailers encouraged traders, who see the performance as a sign that U.S. consumers, which account for 70% of U.S. economic growth, are healthy.

“We had a couple of great earnings reports this morning, especially Target, which is a good barometer of the consumer,” said Dan Heckman, national investment consultant at U.S. Bank Wealth Management. “The consumer still appears to be spending and doing well.”

The S&P 500 rose 23.92 points, or 0.8%, to 2,924.43. The Dow Jones Industrial Average gained 240.29 points, or 0.9%, to 26,202.73. The Nasdaq added 71.65 points, or 0.9%, to 8,020.21. The Russell 2000 index of smaller company stocks picked up 11.84 points, or 0.8%, to 1,509.85.

Major indexes in Europe also finished broadly higher.

The stock market has been volatile this month as investors try to parse conflicting signals on the U.S. economy and determine whether a recession is on the way. A key concern is that the

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