Dow soared 254, advancers over decliners almost 4-1 & NAZ shot up 114. The MLP index jumped up 3+ to the 239s (although its dreary chart continues) & the REIT index gained 6+ to the 328s. Junk bond funds went up & Treasuries also rose. Oil rose to nearly 65 & gold was off 1 after yesterday's plunge.
AMJ (Alerian MLP index tracking fund)
![Live 24 hours gold chart [Kitco Inc.]](http://www.kitco.com/images/live/gold.gif?0.7914757800057489)
Pres Trump said he may delay a revamped trade deal he reached with South Korea this week until after the nuclear confrontation with North Korea is resolved. “I may hold it up until after a deal is made with North Korea,” Trump said at a speech in Richfield, Ohio. “You know why? Because it’s a very strong card and I want to make sure everyone is treated fairly and we’re moving along very nicely with North Korea.” White House officials didn't immediately respond to requests to clarify Trump's intentions & the South Korean embassy in DC didn't immediately respond. Moments before he suggested he would delay the renegotiated agreement, Trump hailed it as “a wonderful deal” & criticized the existing trade agreement with South Korea as “a horror show.” Trump & South Korean Pres Moon Jae-In are planning separate meetings with North Korea's Kim Jong Un in the coming weeks. Kim made a surprise visit to China this week & met with Pres Xi Jinping. China's official news agency said today that Kim would be willing to give up his nuclear weapons & hold a summit with the US. The renegotiated trade deal, announced this week, doubled to 50K the number of cars each US automaker can sell in South Korea without meeting local safety standards. Under the terms, the US also will extend a 25% tariff on pickup-truck imports until 2041. The tariff was set to expire in 2021 under the existing trade agreement, which came into force in 2012. Meanwhile, South Korea agreed to limit its steel exports to the US to about 2.7M tons of year, in exchange for relief from the 25% tariff Trump announced earlier this month. Many of the details of the revised trade deal & the steel quota were previously disclosed by South Korea.
Trump Says He May Hold Up South Korea Trade Deal
US consumer spending climbed modestly in February as savings rose to a 6-month high
club.ino.com/trend/analysis/stock/MCD?a_aid=CD3289&a_bid=6ae5b6f7
Sorry about the mistake in the last post, this is that last day of trading in Q1 & tomorrow will be a day of rest. This has been an unusually wild qtr. After months, even years, of steady gains, wild swings in the stock market became common. Tech stocks had been the leaders on the way & they continued to be leaders, only this time in high volatility. When all was said & done, the Dow finished down 500 in Q1. With growing uncertainties in the tech sector & new rules on tariffs & their impact on the global economy, Q2 is likely to be another very exciting qtr for stocks. At the close the sank 50, whatever that means.
Dow Jones Industrials
AMJ (Alerian MLP index tracking fund)
Pres Trump said he may delay a revamped trade deal he reached with South Korea this week until after the nuclear confrontation with North Korea is resolved. “I may hold it up until after a deal is made with North Korea,” Trump said at a speech in Richfield, Ohio. “You know why? Because it’s a very strong card and I want to make sure everyone is treated fairly and we’re moving along very nicely with North Korea.” White House officials didn't immediately respond to requests to clarify Trump's intentions & the South Korean embassy in DC didn't immediately respond. Moments before he suggested he would delay the renegotiated agreement, Trump hailed it as “a wonderful deal” & criticized the existing trade agreement with South Korea as “a horror show.” Trump & South Korean Pres Moon Jae-In are planning separate meetings with North Korea's Kim Jong Un in the coming weeks. Kim made a surprise visit to China this week & met with Pres Xi Jinping. China's official news agency said today that Kim would be willing to give up his nuclear weapons & hold a summit with the US. The renegotiated trade deal, announced this week, doubled to 50K the number of cars each US automaker can sell in South Korea without meeting local safety standards. Under the terms, the US also will extend a 25% tariff on pickup-truck imports until 2041. The tariff was set to expire in 2021 under the existing trade agreement, which came into force in 2012. Meanwhile, South Korea agreed to limit its steel exports to the US to about 2.7M tons of year, in exchange for relief from the 25% tariff Trump announced earlier this month. Many of the details of the revised trade deal & the steel quota were previously disclosed by South Korea.
Trump Says He May Hold Up South Korea Trade Deal
Stocks jumped, with tech shares leading the way, as equity markets
moved toward the end of a tumultuous qtr on a high note. Treasuries
rose while the $ slipped. Gains in the S&P 500 were led by energy companies &
chipmakers, & were helped by a recovery in Amazon (AMZN) after a
White House spokeswoman said Trump isn't planning to take action
against the company after he accused it of not paying taxes. The 10-year
Treasury yields fell below 2.75% after data showed US consumer spending lagged behind income growth for a 2nd month in Feb. Volumes
were subdued ahead of a long weekend. The S&P 500 was set to end Q1 down less than 1%, marking the
first quarterly loss for the gauge since 2015. The $ had its 5th straight quarterly decline & oil for its 3rd
consecutive quarterly gain. The arrival of the holiday will be a relief for many investors following
a roller coaster start to the year in which stellar global equity gains
gave way to a volatility blowup in Feb & a technology-led rout
in recent days.
China warned the US on not to
open Pandora's Box & spark a flurry of protectionist practices across
the globe, even as Beijing pointed to US goods that it could target in
a deepening Sino-US trade dispute. China
could target a broad range of US businesses from agriculture to
aircraft, autos, semiconductors & even services if the trade conflict
escalates, the official China Daily newspaper said. Pres Trump's move last
week to slap up to $60B in tariffs on some Chinese imports has
since provoked a warning from Beijing that it could retaliate with
duties of up to $3B of US imports. China's
biggest US imports are aircraft & related equipment, soybeans &
autos, with the total bill about $40B last year. "The malicious practices of the United States are
like opening Pandora's Box, and there is a danger of triggering a chain
reaction that will spread the virus of trade protectionism across the
globe," a commerce ministry spokesman said. The
official line from China continues to be stern even as Beijing says it
is all for dialogue & negotiations. The feedback from US & Chinese
officials on the nature & extent of trade talks remains mixed. Chinese customs data shows the
US accounted for just $2.6% (1%) of China's total
semiconductor imports last year by value, with suppliers in South Korea,
Taiwan & Japan commanding a bigger share. But
a source in the US semiconductor industry said US companies have
slightly more than 50% of China's market for chips, though export
data does not reflect that because much of the product is sent offshore
for low value added processing. The source
said the US semiconductor industry had not asked the Trump
administration to urge China to buy more US chips & had been told by
senior US officials that the US gov had not made such a
request to Beijing. "We don't need China to buy
more chips," the source said, adding that US industry was concerned
about being targeted by Chinese non-tariff barriers. "It's
more about (Chinese) subsidies, IP protection, and cyber rules," the
source said, referring to concerns over Chinese retaliation. China
has long said it would like to import more US high-tech goods,
including high-end chips, but has been stymied by US export controls
set on national security grounds. The Trump
administration is accusing Chinese firms of stealing intellectual
property & forcing US firms to share commercial secrets,
allegations that China denies.
China warns US not to open Pandora's Box, unleash trade ills on world
US consumer spending rose marginally for a 2nd
straight month in Feb as households boosted savings, the latest
indication the economy lost momentum in Q1. The Commerce Dept said that consumer spending, which accounts for more than 2/3
of US economic activity, increased 0.2% last month after a
similar gain in Jan. Spending on long-lasting
goods, such as motor vehicles, rebounded 0.2% after tumbling 1.5% in Jan. Outlays on services rose 0.3%, matching
the Jan increase. The forecast had called for consumer
spending increasing 0.2% in Feb. There was also a moderation in monthly inflation readings after prices pushed higher in Jan. The personal
consumption expenditures (PCE) price index excluding the volatile food & energy components rose 0.2% last month after advancing 0.3% in Jan. That lifted the
year-on-year increase in PCE price index to 1.6%, the biggest gain since Feb 2017, from 1.5% in
Jan. The core PCE index is the Fed's preferred inflation measure. It has been below the U.S. central bank's 2% target since mid-2012. Economists believe the
annual core PCE price index could accelerate to 1.9% in Mar as
last year's weak readings drop out of the calculation. The steady rise in
inflation last month also helped curb consumer spending. When adjusted
for inflation, consumer spending was unchanged in Feb after falling
0.2% in the prior month. That suggests a sharp slowdown in
consumer spending in Q1 after it surged at an eye-popping
4.0% annualized rate in Q4. The tepid consumer spending added to data on trade,
housing & business spending on equipment that have left economists
anticipating moderate economic growth in Q1. The Atlanta Fed is currently forecasting GDP growth rising at a rate of 1.8% in Q1 after the
economy grew at a 2.9% pace in Q4. In Feb, personal
income rose 0.4% & has now increased by the same margin for 3 straight months. Wages increased 0.5% last month after
climbing 0.6% in Jan. Savings increased to
$497.4B in Feb, the highest level since Aug 2017, from
$471.3B in the prior month. The saving rate rose to a 6-month
high of 3.4% from 3.2% in Jan.
US consumer spending climbed modestly in February as savings rose to a 6-month high
McDonald's (MCD), a Dow stock & Dividend Aristocrat, citing the new US tax law & the
tightening job market, is expanding its 3-year-old education benefits
program, tripling the amount of money some workers can get each year to
help pay for college or trade school tuition. The
fast-food company is also changing its eligibility rules, which it said
will double the number of workers who qualify to 400K (about ½
the people who work at company restaurants in the US). Other
chains have given workers bonuses or
boosted benefits because of the new tax law, which cut the corp tax rate. MCD also hopes the
expanded benefit will help attract & keep workers. Large employers
have had a hard time attracting & keeping workers because of
historically low unemployment rates. "There is a fight for talent all around the world," said CEO Steve Easterbrook. Restaurant crew members will be able to get up to $2500
per year for tuition, an increase from $700. Managers can receive up to
$3000 per year, an increase from $1050. The company has set aside $150M over 5 years to pay for the program. The stock went up 6¢.
If you would like to learn more about MCD, click on this link:club.ino.com/trend/analysis/stock/MCD?a_aid=CD3289&a_bid=6ae5b6f7
McDonald's expands worker tuition benefits, citing tax law
Sorry about the mistake in the last post, this is that last day of trading in Q1 & tomorrow will be a day of rest. This has been an unusually wild qtr. After months, even years, of steady gains, wild swings in the stock market became common. Tech stocks had been the leaders on the way & they continued to be leaders, only this time in high volatility. When all was said & done, the Dow finished down 500 in Q1. With growing uncertainties in the tech sector & new rules on tariffs & their impact on the global economy, Q2 is likely to be another very exciting qtr for stocks. At the close the sank 50, whatever that means.
Dow Jones Industrials
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