Monday, June 4, 2018

Markets rise after positive economic data

Dow gained 178, advancers over decliners almost 2-1 & NAZ added 52.  The MLP index climbed 1+ to 271 & the REIT index went up 2+ to the 344s.  Junk bond funds were mixed & Treasuries declined, taking the yield on the 10 Year Treasury back up to 2.94% (nearing the important 3% level).  Oil fell into the 94s & gold slid back 2 to 1296.

AMJ (Alerian MLP Index tracking fund)

Live 24 hours gold chart [Kitco Inc.]

3 Stocks You Should Own Right Now - Click Here!

China has warned any agreements with the US in their talks on settling a sprawling trade dispute "will not take effect" if threatened US sanctions including tariff hikes go ahead.  The statement yesterday came shortly after delegations led by Commerce Secretary Wilbur Ross & China's top economic official, Vice Premier Liu He, held another round of talks on China's pledge to narrow its trade surplus with the US by purchasing more American goods.  The Chinese statement said the 2 sides made "positive and concrete progress," but neither side released details.  The statement said, "If the United States introduces trade sanctions including increasing tariffs, all the economic and trade achievements negotiated by the two parties will not take effect."  Ross said US & Chinese officials have discussed specific American export items Beijing might buy as part of its pledge to narrow its trade surplus with the US.  Premier Liu He. But Chinese envoys promised after the last high-level meeting in DC in mid-May to buy more American farm goods & energy products after Pres Trump pressed Beijing to narrow its multibillion-$ trade surplus & threatened to hike duties on up to $150B of Chinese imports.

The Latest: China warns US no deal if tariffs go ahead

US factory orders fell 0.8% in Apr, somewhat higher than expected.  The forecast called for a 0.5% drop.  The decline was concentrated in commercial aircraft.  Orders for nondurable goods rose slightly.  The increase in factory orders in Mar, meanwhile, was raised a tick to 1.7%, the gov.

U.S. factory orders drop 0.8% in April on lower aircraft contracts

Walmart (WMT), a Dow stock & Dividend Aristocrat, said that it has sold an 80% stake in its Brazilian operations to private equity firm Advent Intl, exiting an underperforming business in its 3rd major intl deal since Apr.  The retailer has been looking to jumpstart its overseas business by retreating from lower-growth markets & investing in places like China & India.  Brazil had for a decade been the focus of expansion but the unit stumbled in recent years as operational issues compounded the effects of a deep recession.  The value of the transaction was not disclosed but WMT said it would record a noncash charge of roughly $4.5B related to the deal in Q2 & the retailer will retain the remaining 20% stake in Walmart Brazil.  The charge is is believed to be close to the value of the Brazilian unit on WMT books (i.e.about zero).  The stock rose 2.43.
If you would like to learn more about WMT, click on this link:

Walmart sells majority of Brazil unit, takes $4.5B charge

Apple (AAPL), in the Dow & NAZ, shares hit a new all-time high, as tens of thousands of developers flooded into the WWDC, the company's annual developer conference.  The stock rose to a high over $193, pushing the market capitalization past $940B after the shares have gained 24% over the past year.  The developer conference draws 3rd-party programmers from across the world to hear the company discuss new tools & features, as well as introduce its new operating system.  WWDC has become increasingly important, as the company works to assert itself as a software & services provider, rather than just a maker of iPhones & Macs.  AAPL announced several features & upgrades, including a new operating system iOS 12, a new augmented reality toolkit in partnership with Adobe (ADBE) & new features for combating tech addiction.  AAPL stock finished the day in the 191s, up 1.59.
If you would like to learn more about AAPL, click on this link:

Apple shares hit all-time record at start of developer conference, edging near $1 trillion valuation

Stocks had another good day, although they were not hit with headwinds from trade talks.  The rise this year at NAZ has been powered by the sexiest tech stocks, starting with AAPL.  The top 5 in market caps are those big name tech companies, taking the NAZ up about 10% in 2018.  Other stocks have been largely slugging it out in the trenches, taking the Dow sideways around 24K+, unable to get above 25K in a meaningful way.  In recent weeks, REITs, largely unaffected by trade war concerns, have been rising.  But not like those tech stocks.

Dow Jones Industrials

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