Dow went up 30 to a another new record, advancers over decliners 3-2 & NAZ & gained 37. The MLP index was off 2 to the 319s & the REIT index slid back a fraction to 370. Junk bond funds went up & Treasuries pulled back again. Oil declined (see below) & gold was also lower.
AMJ (Alerian MLP Index tracking fund)
Germany sold 5-year gov securities at a record-low yield, even as investors bid for less than the target amount in a sign that appetite for the nation's negative-yielding debt may be dwindling. The Finance Agency allotted €3.386B ($3.73B) of debt due in Oct 2021 at an average yield of minus 0.51%. Investors bid for €3.486B of the securities, compared with a sales target of €5B. The bid-to-cover ratio, a gauge of demand derived from the amount of securities allocated to investors compared with the amount tendered, fell to 1.03, the lowest at a 5-year debt sale in 5 years. The offering came amid speculation the ECB may relax some of the rules of its asset-purchase program to combat the growing scarcity of core sovereign bonds available for its purchase. The ECB will announce its latest monetary policy tomorrow, its first decision since the UK's vote to leave the EU. The central bank is predicted to leave its deposit rate at a record-low minus 0.4%.
Oil prices edged lower ahead of weekly US crude inventory data as investors awaited a clearer signal on whether a glut was easing in the world's largest oil-consuming nation. Russia's energy minister added to the bearish impetus as he dashed any hope that the world's biggest oil producers could coordinate on output to stem global oversupply. He said that Russia was not discussing coordination with OPEC & that Russian oil output would rise to 542-544M tons this year, a 30-year high. The US gov Energy Information Administration (EIA) will issue stockpile data later today. The American Petroleum Institute reported uesterrday that crude stockpiles fell by 2.3M barrels last week, just above a 2.1M-barrel draw forecast. For distillate inventories including diesel, API reported a surprise draw of 484K barrels. But it also showed an unexpected gasoline build of 805K barrels.
China stocks closed lower today as mixed signals from economic data added to investors' uncertainty over prospects for further policy stimulus this year. The CSI300 index of the largest listed companies in Shanghai & Shenzhen fell 0.3% to 3237, while the Shanghai Composite Index lost 0.3% to 3027. Volumes were weak for the 2nd day in a row, with only 13.8B shares trading hands in Shanghai. The economy grew slightly more than expected in Q2, but exports remained weak & private investment growth shrank to a record low, data on Fri showed. An official survey on Mon showed home price rises in China slowed in Jun for a 2nd straight month, adding to fears that a construction-led rebound in the economy may not be sustainable.
There is no shortage of optimism in the stock market which is taking the averages to new heights. But oil is lower, a negative sign on prospects for growth. US data is lackluster & keeps showing household earnings & income higher by minimal amounts. Overseas markets keep stumbling. Dow is up about 1½K in less than a month, vastly overbought & subject to a major correction.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
Crude Oil Aug 16
| 43.93 | -0.72 | -1.61% |
Gold Futures,Aug-2016
| 1,315.80 | -16.50 | -1.24% |
Germany sold 5-year gov securities at a record-low yield, even as investors bid for less than the target amount in a sign that appetite for the nation's negative-yielding debt may be dwindling. The Finance Agency allotted €3.386B ($3.73B) of debt due in Oct 2021 at an average yield of minus 0.51%. Investors bid for €3.486B of the securities, compared with a sales target of €5B. The bid-to-cover ratio, a gauge of demand derived from the amount of securities allocated to investors compared with the amount tendered, fell to 1.03, the lowest at a 5-year debt sale in 5 years. The offering came amid speculation the ECB may relax some of the rules of its asset-purchase program to combat the growing scarcity of core sovereign bonds available for its purchase. The ECB will announce its latest monetary policy tomorrow, its first decision since the UK's vote to leave the EU. The central bank is predicted to leave its deposit rate at a record-low minus 0.4%.
Germany’s Weakest Note Auction Since 2011 Signals Fading Demand
Oil prices edged lower ahead of weekly US crude inventory data as investors awaited a clearer signal on whether a glut was easing in the world's largest oil-consuming nation. Russia's energy minister added to the bearish impetus as he dashed any hope that the world's biggest oil producers could coordinate on output to stem global oversupply. He said that Russia was not discussing coordination with OPEC & that Russian oil output would rise to 542-544M tons this year, a 30-year high. The US gov Energy Information Administration (EIA) will issue stockpile data later today. The American Petroleum Institute reported uesterrday that crude stockpiles fell by 2.3M barrels last week, just above a 2.1M-barrel draw forecast. For distillate inventories including diesel, API reported a surprise draw of 484K barrels. But it also showed an unexpected gasoline build of 805K barrels.
Oil Edges Lower Ahead of U.S. Crude Inventory Data
China stocks closed lower today as mixed signals from economic data added to investors' uncertainty over prospects for further policy stimulus this year. The CSI300 index of the largest listed companies in Shanghai & Shenzhen fell 0.3% to 3237, while the Shanghai Composite Index lost 0.3% to 3027. Volumes were weak for the 2nd day in a row, with only 13.8B shares trading hands in Shanghai. The economy grew slightly more than expected in Q2, but exports remained weak & private investment growth shrank to a record low, data on Fri showed. An official survey on Mon showed home price rises in China slowed in Jun for a 2nd straight month, adding to fears that a construction-led rebound in the economy may not be sustainable.
China Shares End Lower as Investors Await Policy Clues
There is no shortage of optimism in the stock market which is taking the averages to new heights. But oil is lower, a negative sign on prospects for growth. US data is lackluster & keeps showing household earnings & income higher by minimal amounts. Overseas markets keep stumbling. Dow is up about 1½K in less than a month, vastly overbought & subject to a major correction.
Dow Jones Industrials
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