Dow gained 138, advancers 2-1 over decliners & NAZ went up 30. The MLP index recovered another 1+ to 451 & the REIT index was up 1+ to the 284s. Junk bond funds continued mixed while Treasuries were flat. Oil is working its way closer to 100 but gold continued to slide to its lowest level since late 2010.
AMJ (Alerian MLP Index tracking fund)
![Live 24 hours gold chart [Kitco Inc.]](http://www.kitco.com/images/live/gold.gif)
The US oil boom is moving Congress closer than it has been in more than 3 decades to easing the ban on exporting crude imposed after the Arab embargo. Advances such as hydraulic fracturing are leading to record production that may outstrip refinery capacity in the next few years. Net petroleum imports now account for about 40% of demand, down from 60% in 2005, according to the Energy Dept. Congress has limited oil exports since the 1973-74 Arab oil embargo triggered shortages that pushed up prices & led to long lines at gas stations. An increase in domestic production last year by a record 766K barrels a day is challenging a notion that Americans need foreign oil, while setting up a debate among policy makers. The US sends about 120K barrels of crude a day to Canada under a Commerce Dept license. Congress allows exports from Alaska's Cook Inlet & for consumption in Canada, along with sales determined by the president to be in the national interest. Exports must expand to sustain the boom. Output is putting the nation on pace to surpass Saudi Arabia as the world’s largest producer by 2020, according to Energy Dept data. This is an important part of the new world we are in.
Americans Exporting More Oil First Time Since ’70s
Leaders of the Group of Eight nations said the worst has passed for the global economy following summit talks on promoting employment & growth. While the economic outlook is subdued, risks have abated, the G-8 said in a statement. “Global economic prospects remain weak, though downside risks have reduced thanks in part to significant policy actions taken in the U.S., euro area and Japan,” according to the statement. The leaders are under pressure to spur growth & reduce unemployment as the unexpected slowing of the Chinese economy in Q1 sparked concerns of a weakening global expansion. The euro-area economy is shrinking for a 2nd year & the UK is emerging from a double-dip recession amid investor concern that the US Federal Reserve is preparing to unwind stimulus. Any new optimism “is yet to be translated fully into broader improvements in economic activity and employment in most advanced economies,” according to the G-8 statement. German Chancellor Angela Merkel said European leaders agreed that “we have overcome the manifest crisis of confidence, but that a huge amount of work still lies ahead.” Growth requires “sound finances” & structural change in EU economies, she said. Underscoring the fragile outlook, the IMF trimmed its 2013 global growth forecast in Apr to 3.3% from 3.5%. The estimate for 2014 is 4% as the US picks up & the euro area begins expanding again.
G-8 Leaders See Worst Over for World Economy After Summit
Photo: Bloomberg
Hewlett-Packard CEO Meg Whitman is reorganizing the PC business, replacing longtime head Todd Bradley with one of his deputies as she strives to overcome a worsening global PC slump. Bradley is becoming executive VP for strategic growth, charged with expanding in China & forming alliances with startups around the world. CEO since 2011, Whitman is working to turn around HPQ after 7 straight qtrs of declining sales & years of management tumult & strategic missteps. After reclaiming the #1 position in PCs for 6 years under Bradley, the company has been slow to follow users in their shift away from desktop machines to smartphones & tablets. ‘‘We’re 100 percent committed to the printing and personal systems business, and today’s announcement doesn’t change that,” an HPQ spokesman said. The stocks rose 24¢ today & has doubled off its lows at the start of this year.
HP’s Whitman Reassigns Bradley in Revamp Amid PC Slump
Stocks are aleady anticipating a favorable announcement by the Federal Reserve tomorrow. There is thinking that because Big Ben is short (probably leaving around the end of the year), he will leave the painful decision about winding down bond buying to his successor. While that sounds good, it reinforces the thought that low interest rates are behind the market raise, not strong economic fundamentals & growth. With all this "good news" baked into the market, there could be a shortage of buyers after Big Ben speaks. The high yield sectors have sold off in recent weeks ahead of the meeting & their recovery in last few days has been limited.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
Treasury yields:
U.S. 3-month |
0.05% | |
U.S. 2-year |
0.26% | |
U.S. 10-year |
2.18% |
| CLX13.NYM | ...Crude Oil Nov 13 | ...97.89 |  ...0.50 | (0.5%) |
The US oil boom is moving Congress closer than it has been in more than 3 decades to easing the ban on exporting crude imposed after the Arab embargo. Advances such as hydraulic fracturing are leading to record production that may outstrip refinery capacity in the next few years. Net petroleum imports now account for about 40% of demand, down from 60% in 2005, according to the Energy Dept. Congress has limited oil exports since the 1973-74 Arab oil embargo triggered shortages that pushed up prices & led to long lines at gas stations. An increase in domestic production last year by a record 766K barrels a day is challenging a notion that Americans need foreign oil, while setting up a debate among policy makers. The US sends about 120K barrels of crude a day to Canada under a Commerce Dept license. Congress allows exports from Alaska's Cook Inlet & for consumption in Canada, along with sales determined by the president to be in the national interest. Exports must expand to sustain the boom. Output is putting the nation on pace to surpass Saudi Arabia as the world’s largest producer by 2020, according to Energy Dept data. This is an important part of the new world we are in.
Americans Exporting More Oil First Time Since ’70s
Leaders of the Group of Eight nations said the worst has passed for the global economy following summit talks on promoting employment & growth. While the economic outlook is subdued, risks have abated, the G-8 said in a statement. “Global economic prospects remain weak, though downside risks have reduced thanks in part to significant policy actions taken in the U.S., euro area and Japan,” according to the statement. The leaders are under pressure to spur growth & reduce unemployment as the unexpected slowing of the Chinese economy in Q1 sparked concerns of a weakening global expansion. The euro-area economy is shrinking for a 2nd year & the UK is emerging from a double-dip recession amid investor concern that the US Federal Reserve is preparing to unwind stimulus. Any new optimism “is yet to be translated fully into broader improvements in economic activity and employment in most advanced economies,” according to the G-8 statement. German Chancellor Angela Merkel said European leaders agreed that “we have overcome the manifest crisis of confidence, but that a huge amount of work still lies ahead.” Growth requires “sound finances” & structural change in EU economies, she said. Underscoring the fragile outlook, the IMF trimmed its 2013 global growth forecast in Apr to 3.3% from 3.5%. The estimate for 2014 is 4% as the US picks up & the euro area begins expanding again.
G-8 Leaders See Worst Over for World Economy After Summit
Photo: Bloomberg
Hewlett-Packard CEO Meg Whitman is reorganizing the PC business, replacing longtime head Todd Bradley with one of his deputies as she strives to overcome a worsening global PC slump. Bradley is becoming executive VP for strategic growth, charged with expanding in China & forming alliances with startups around the world. CEO since 2011, Whitman is working to turn around HPQ after 7 straight qtrs of declining sales & years of management tumult & strategic missteps. After reclaiming the #1 position in PCs for 6 years under Bradley, the company has been slow to follow users in their shift away from desktop machines to smartphones & tablets. ‘‘We’re 100 percent committed to the printing and personal systems business, and today’s announcement doesn’t change that,” an HPQ spokesman said. The stocks rose 24¢ today & has doubled off its lows at the start of this year.
HP’s Whitman Reassigns Bradley in Revamp Amid PC Slump
Hewlett-Packard (HPQ)
Stocks are aleady anticipating a favorable announcement by the Federal Reserve tomorrow. There is thinking that because Big Ben is short (probably leaving around the end of the year), he will leave the painful decision about winding down bond buying to his successor. While that sounds good, it reinforces the thought that low interest rates are behind the market raise, not strong economic fundamentals & growth. With all this "good news" baked into the market, there could be a shortage of buyers after Big Ben speaks. The high yield sectors have sold off in recent weeks ahead of the meeting & their recovery in last few days has been limited.
Dow Jones Industrials
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