Thursday, June 9, 2016

Markets pare losses in late day trading

Dow slid back 19 (well off the lows), decliners over advancers 3-2 & NAZ declined 16.  The MLP index pared its losses, down a fraction in the 314s, & the REIT index rose 3+ to the 346s.  Junk bond funds edged higher & Treasuries rallied.  Oil is back under 51 & gold remains on the rise (see below).

Dow Jones Industrials

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CLN16.NYM....Light Sweet Crude Oil Futures,J....50.62 Down ...0.61  (1.2%)

Live 24 hours gold chart [Kitco Inc.]

Boeing, a Dow stock, is streamlining oversight of its marquee 787 Dreamliner, putting the chain of command for the plane's its factories under one person to accelerate decision making.  Mark Jenks, 787 program VP & general manager, will lead the integration of the factories & supervise all of the jet's operations, CEO Ray Conner & pres of the commercial airplane division.  Beverly Wyse, who had run the Dreamliner’s North Charleston factory as VP & general manager of Boeing South Carolina, is being promoted.  Her new role: pres of the multibillion-dollar shared-services group, which manages such functions as accounting, human resources & real estate that are used across all of the aerospace manufacturer's businesses.  “With Beverly moving into a different role, we are also taking the opportunity to streamline the 787 team,” Conner said.  “At this stage in the program’s maturity cycle, we are in the solid position to strengthen ties between our Everett and North Charleston 787 operations.”  The shifts come as Conner works to flatten the management structure of the commercial airplane business & speed decision making.  The division is already paring 4K jobs, about 5% of the workforce, thru attrition & voluntary layoffs.  The stock fell 92¢.  If you would like to learn more about BA, click on this link:

Boeing Puts Dreamliner Under One Leader in Management Shift

Boeing (BA)

Gold rose for a 2nd-straight session to settle at the highest level since May 18.  Prices got a boost as expectations for a US interest-rate increase in the coming months eased & the market weighed the likelihood that the UK may leave the EU.  Aug gold settled at $1272, up $10 (0.8%).

Gold Futures Log Highest Settlement In More Than Three Weeks

Canada's energy sector has been hit hard over the past couple of years.  Not only have very weak oil prices impacted producer profitability, but the recent wildfires in the oil sands region have impacted production.  With the wildfires moving away from the region, producers like ConocoPhillips are finally starting to reactivate facilities that were shut down as a precaution.  It's an important step for the company because it had been expecting the oil sands to be a key growth driver during the downturn. COP & its partner started to reactivate wells at their Surmont oil sands project, which had been shut down for nearly a month.  As of earlier this week the company had activated 25% of the wells, with hopes of restarting all 156 wells as quickly as possible.  They don't expect Surmont to be back up to its pre-fire production level of 60K barrels per day until early Jul.  For most oil companies having a project as large as Surmont offline for that lengthy period of time would be quite the blow.  However, the partners won't see as dramatic an impact on their overall production due to the sheer size of their global operations.  In the COP case, it had expected to produce 1.5-1.54M barrels of oil equivalent per day, or BOE/d, during Q2, so it could still be within its guidance range despite the reduced output from Surmont.  The stock was up a dime.  If you would like to learn more about COP, click on this link:

ConocoPhillips Finally Fires Back Up This Key Oil Growth Project

ConocoPhillips (COP)

Stocks recovered late in the day.  There was no special reason for selling in the AM.other than an oversold bought market in the short term.  Then short term traders bought on the dip.  Dow is just under 18K, a ceiling that it has not been able to crack for some time. 

Dow Jones Industrials

stock chart

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