Dow finished down 165, decliners over advancers better than 2-1 & NAZ sank a very big 116. The MLP index fell 3+ to the 261s & the REIT index was off 1+ to the 349s. Junk bond funds slid lower & Treasuries rallied, taking the yield on the 10 year Treasury down to 2.83% (lowest in Jun). Oil popped to the 72s (more below) & gold lost 5 to 1254.
AMJ (Alerian MLP Index tracking fund)
![Live 24 hours gold chart [Kitco Inc.]](https://www.kitco.com/images/live/gold.gif?0.8116015171332475)
US oil exports reached a record 3M barrels a day last week, more than is pumped each day by all but 3 OPEC countries. When combined with fuel products, like diesel & gasoline, US oil & related products exports totaled 8.5M barrels a day last week, the most ever, according to US Energy Information Administration weekly data. US oil production also continued at a record pace of 10.9M barrels a day, a level first reached this month. That is more oil than produced by every other country in the world, except for Russia, which does not belong to OPEC & pumps just over 11M barrels a day. US refineries also took in a record 18M barrels of oil. To put US exports in context, the US was able to export more oil per day last week than most OPEC countries drilled. The US weekly exports fluctuate dramatically, but if they stay at this level, the US would be just behind Canada, which sends about 3.5M barrels to the US each day, the bulk of of its exports. As US production has grown, US imports have decreased. The US imported a relatively high 8.4M barrels per day last week. The 3M barrel level may not be sustainable just yet. Analysts said some of the oil appears to have been pulled from inventories, which fell an unusually large amount last week.
US oil exports boom to record level, surpassing most OPEC nations
Oil prices rose to their highest level since Nov 2014 after a bigger-than-expected drop in US crude stockpiles added to a rally fueled by a major Canadian supply outage, concerns about Libya's exports & stepped-up efforts by the Trump administration to disrupt Iran's petroleum exports. US light crude ended up $2.23 (3.2%) at $72.76 a barrel, its best closing prices since Nov 2014. The contract briefly topped $73 a barrel, also hitting its highest intraday level since Nov 2014. Brent crude oil rose $1.41 a barrel (1.9%) to $77.72, adding to yesterday's gain of $1.50. US commercial crude inventories dropped by 9.9M barrels in the latest week, the US Energy Information Administration reported. Analysts expected a drop of about 2.6M barrels, while earlier industry data showed a 9.2M barrel decline. US crude prices surged $2.45 a barrel yesterday after the State Dept said it is telling companies that buy Iranian crude oil that they must completely cut those exports by Nov 4, or they will face powerful US sanctions. The hardline approach comes at a time when oil markets are finely balanced & crude prices are trading near multi-year highs. It also came on the heels of a supply outage at Syncrude in Canada, which has locked in 350K barrels per day (bpd) of crude, with repairs expected to last at least thru Jul. The fall in Canadian exports has helped drain supplies of heavy crude across North America & contributed to the draw in US crude oil inventories. In Libya, a power struggle between the official gov & rebels has left it unclear who will handle the country's oil exports, although as of yesterday the oil ports of Hariga & Zueitina in eastern Libya were working normally. OPEC on Fri agreed to increase oil output to prevent the market from overheating. The 14-member producer group took action as Venezuela's dwindling output, the looming disruptions to Iran's supplies & production declines elsewhere raised concerns about oil prices rising enough to dent global demand.
US crude surges 3.2% on supply concerns, settling at $72.76, best closing price since Nov 2014
club.ino.com/trend/analysis/stock/GIS?a_aid=CD3289&a_bid=6ae5b6f7
After hearing the words "not so fast" regarding easing trade tensions, the AM rally faded fast. The Dow finished 450 below its high today with techs & financials leading the decline. It's just above the 25K resistance once again & that may be tested tomorrow. The stock market continues to be on thin ice because the bulls have lost control for 5 months. Trade issues remain center stage & nobody knows where they will lead.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
Pres Trump has no plans to soften his stance
on trade relations with China, Larry Kudlow the director of the National
Economic Council said. Kudlow
said the Foreign Investment Risk Review Modernization Act [FIRRMA] is a
reform bill that aims to refresh & modernize the Committee on Foreign
Investment in the US, it should not be viewed as a lighter version
which had been reported by some news outlets. “It’s
going to be very comprehensive and very effective at protecting our
technological family jewels,” Kudlow added. Meanwhile Kudlow said Trump still plans to move forward on the plan to impose tariffs on steel & aluminum, but is open to the prospect of more dialogue with the nation's largest trading partners. “He is a free trader,” said Kudlow. “He would like
to see no tariffs, no non-tariff barriers, no subsidies—and we are open
for that discussion.” Even so, Kudlow isn't expecting a radical shift anytime soon & noted that Trump is taking a “wait and see” approach to trade relations between the world's 2 largest economies. “The
president proffered the possibility of $200 billion more in tariffs—
it’s not implemented… but he made that as a warning because we have not
had a satisfactory response from China,” he added. “I believe that China is operating from a greater
position of weakness than folks think,” he said. “We are operating from a
greater position of economic strength.” Kudlow is returning to work for the first time since Jun 11 after suffering a heart attack. “I
feel great- great to be back,” he said. “To quote one of my heroes Mark
Twain – rumors of my demise were greatly exaggerated.”
Trump is modernizing foreign investment rules: Larry Kudlow
Texas steel pipe maker Borusan Mannesmann Pipe US wants protection against Pres Trump's tariffs, CEO Joel Johnson said. Borusan's
headquarters are located in Turkey & Trump's levies would cost the
company as much as $35M a year & undermine expansion plans. “What
we’ve tried to do is spin this into a unique offer for a deal to
President Trump and Secretary Ross is to give us a short-term exemption,
allow us time to build a new factory alongside our existing one and
become 100 percent American steel and pipe and stop imports,” Johnson
said. Trump says his tariffs on steel & aluminum will
boost US business & level the playing field, but Johnson said
immunity conforms to what the pres wants – more domestic jobs &
investments. The short-term exemption, he added, would also allow Borusan to purchase more hot-rolled coiled steel from US suppliers
Steel pipe maker based in Turkey aims to become 100% American
US oil exports reached a record 3M barrels a day last week, more than is pumped each day by all but 3 OPEC countries. When combined with fuel products, like diesel & gasoline, US oil & related products exports totaled 8.5M barrels a day last week, the most ever, according to US Energy Information Administration weekly data. US oil production also continued at a record pace of 10.9M barrels a day, a level first reached this month. That is more oil than produced by every other country in the world, except for Russia, which does not belong to OPEC & pumps just over 11M barrels a day. US refineries also took in a record 18M barrels of oil. To put US exports in context, the US was able to export more oil per day last week than most OPEC countries drilled. The US weekly exports fluctuate dramatically, but if they stay at this level, the US would be just behind Canada, which sends about 3.5M barrels to the US each day, the bulk of of its exports. As US production has grown, US imports have decreased. The US imported a relatively high 8.4M barrels per day last week. The 3M barrel level may not be sustainable just yet. Analysts said some of the oil appears to have been pulled from inventories, which fell an unusually large amount last week.
US oil exports boom to record level, surpassing most OPEC nations
Oil prices rose to their highest level since Nov 2014 after a bigger-than-expected drop in US crude stockpiles added to a rally fueled by a major Canadian supply outage, concerns about Libya's exports & stepped-up efforts by the Trump administration to disrupt Iran's petroleum exports. US light crude ended up $2.23 (3.2%) at $72.76 a barrel, its best closing prices since Nov 2014. The contract briefly topped $73 a barrel, also hitting its highest intraday level since Nov 2014. Brent crude oil rose $1.41 a barrel (1.9%) to $77.72, adding to yesterday's gain of $1.50. US commercial crude inventories dropped by 9.9M barrels in the latest week, the US Energy Information Administration reported. Analysts expected a drop of about 2.6M barrels, while earlier industry data showed a 9.2M barrel decline. US crude prices surged $2.45 a barrel yesterday after the State Dept said it is telling companies that buy Iranian crude oil that they must completely cut those exports by Nov 4, or they will face powerful US sanctions. The hardline approach comes at a time when oil markets are finely balanced & crude prices are trading near multi-year highs. It also came on the heels of a supply outage at Syncrude in Canada, which has locked in 350K barrels per day (bpd) of crude, with repairs expected to last at least thru Jul. The fall in Canadian exports has helped drain supplies of heavy crude across North America & contributed to the draw in US crude oil inventories. In Libya, a power struggle between the official gov & rebels has left it unclear who will handle the country's oil exports, although as of yesterday the oil ports of Hariga & Zueitina in eastern Libya were working normally. OPEC on Fri agreed to increase oil output to prevent the market from overheating. The 14-member producer group took action as Venezuela's dwindling output, the looming disruptions to Iran's supplies & production declines elsewhere raised concerns about oil prices rising enough to dent global demand.
US crude surges 3.2% on supply concerns, settling at $72.76, best closing price since Nov 2014
Cheerios cereal maker General Mills (GUS)
reported a quarterly profit that topped estimates, as its
efforts to reduce costs and improve distribution network paid off. Gross
margins of the company, which is also known for its Haagen-Dazs &
Betty Crocker brands, rose to 36.5% in its Q4 from
34.7% a year earlier. GIS expects organic net sales to be flat to up 1%. Including the impact of it acquisition of pet food snacks maker
Blue Buffalo, net sales are expected to rise 9-10%
from a year earlier. To counter slowing sales
growth in the packaged foods industry, the company bought pet snacks
maker Blue Buffalo Pet Products for nearly $8B earlier this year. EPS fell to 59¢
from 69¢ a year earlier. Excluding
certain items, EPS was 79¢, topping expectations of 72¢. Net sales rose 2% to $3.89B, in line with the estimate. The stock fell 33¢.
If you would like to learn more about GIS, click on this link:club.ino.com/trend/analysis/stock/GIS?a_aid=CD3289&a_bid=6ae5b6f7
General Mills quarterly profit drops 13 percent
After hearing the words "not so fast" regarding easing trade tensions, the AM rally faded fast. The Dow finished 450 below its high today with techs & financials leading the decline. It's just above the 25K resistance once again & that may be tested tomorrow. The stock market continues to be on thin ice because the bulls have lost control for 5 months. Trade issues remain center stage & nobody knows where they will lead.
Dow Jones Industrials
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