Monday, November 26, 2018

Higher markets on holiday cheers for retail sales

Dow rebounded 377, advancers over decliners 3-1 & NAZ gained 111.  The MLP index rose 3+ to the 245s (still depressed as shown below) & the REIT index lost 1 to the 348s.  Junk bond funds crawled higher following recent selling & Treasuries slid lower in price.  Oil jumped up 1+ to the 51s & gold was even at 1223.

AMJ (Alerian MLP Index tracking fund)

CL=FCrude Oil51.86
+1.44 +2.9%

GC=FGold   1,223.40
+0.20 +0.0%

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Stocks rose on strong Black Friday spending, increases in the price of crude oil & global equity gains.  Record Thanksgiving holiday shopping signaled to investors that consumers are poised to give retailers a robust end-of-the-year boost.  Crude oil prices rose more than 1% & Asian as well as European bourses were booking gains.  In addition, hopes for a detente in the trade dispute between the US & China at the G20 summit in Argentina lifted investor sentiment.  In Europe, London's FTSE was up 0.7%, Germany's DAX  gained 1.1% & France's CAC added 0.6%.  In Asia, Japan's Nikkei ended the day up 0.8%.  China's Shanghai Composite finished the session off 0.1% & Hong Kong's Hang Seng index closed with a gain of 1.7%.  The final trading week of the month will feature reports on home prices, GDP & minutes from the last Fed meeting.  On Fri, stocks fell, led by weaker tech company shares & crude oil prices extended their slump while retailers handled the annual Black Friday shopping spree.  Crude oil prices plummeted approximately 6% to their lowest levels this year on continued concerns about a global oversupply.  However, the price decline gave a boost to airline stocks on prospects of lower fuel costs.  Tech stocks led the broader market's decline, with Facebook (FB) & Apple (AAPL) falling more than 2%.  The day's equity trading session marked the largest 2-week point & percentage decline since Mar 23.

Black Friday buying, rising oil prices buoy US stocks

More shoppers turned to the internet for deals to kick off the holiday shopping season, new data showed Sat, buying everything from apparel to flat-screen TVs & spending record amounts in the process.  Black Friday pulled in $6.22B in online sales, up 23.6% from a year ago & setting a new high, according to Adobe Analytics, which tracks transactions for 80 of the top 100 internet retailers in the US.  Those figures arrived as many retailers have pushed big digital deals, days in advance of the holiday weekend.  The Fri after Thanksgiving this year was also the first day in history to see more than $2B in sales stemming from smartphones.  The group found 33.5% of e-commerce sales Fri came from mobile devices, compared with 29.1% in 2017.  “Retailers have done their part to build better mobile experiences for consumers and turning nearly 10 percent more smartphone visitors into buyers this Black Friday versus last,” said Taylor Schreiner, director of Adobe Digital Insights.  Buy online pick up in stores continues to be a popular option for shoppers this holiday season, with “click-and-collect” orders up 73% from Thurs-Fri.  Shoppers were seen buying more big-ticket items like appliances, furniture & bulkier electronics from their phones Black Friday, with average order values up 8.5% year over year to reach $146.  Earlier in the week, sales online Thanksgiving Day totaled $3.7B, up 28% from a year ago, making it the fastest-growing day for e-commerce sales in history.  Thurs also saw $1B in sales from smartphones, with shoppers spending 8% more online compared with a year ago.  For the first time, according to Adobe, online prices Thanksgiving Day “were as low as on Black Friday” — potentially stealing some of Black Friday's traditional throngs of shoppers at malls & other stores.  There were reports that traffic at many shopping malls was lighter than in past years.  Instead, more consumers turned to their phones or desktop computers to grab bargains.  Adobe is expecting Cyber Monday sales online to set a new record of $7.8B, up nearly 18% from last year.  As of Sat, Small Business Saturday was on track to reach a new record of $3B in online sales. 

Black Friday shopping pulled in a record $6.22 billion in online sales: Adobe

General Motors (GM) is set to make a major announcement that will affect its global operations.  A Canadian union says GM is threatening to shut down a big vehicle assembly plant in the province of Ontario.  Unifor, which represents most unionized autoworkers in Canada, said it had been informed by GM that there would be no product allocated to the plant in Oshawa after Dec 2019, a development that would affect production at the plant.  It was reported that GM was planning to close all operations at the plant in Oshawa, near Toronto.  GM has been cutting jobs to deal with plunging car sales in North America & has been debating for months how to address shrinking car demand.  Part of the plan is to significantly cut car production in North America & stop building some low-selling car models.  About 18K of its 50K salaried employees in North America are eligible for the buyouts.  The stepped up cost-cutting and restructuring at GM comes as many industry execs & analysts predict that overall vehicle sales in the US will decline further in 2019 & 2020.  GM employs about 2500 union staff in Oshawa which produces both the Chevrolet Impala & Cadillac XTS sedans.  It also completes final assembly of the stronger-selling Silverado & Sierra pickup trucks which are shipped from Indiana.  The stock rose 2.56 (8%).
If you would lilke to learn more about GM, click on this  link:

GM plans major announcement closure of Canadian plant, union says

EU leaders backed Theresa May's Brexit withdrawal agreement yesterday, setting up a showdown with lawmakers in her own country as the UK leader nears a crucial vote on her proposals.  European leaders gathered in Brussels officially endorsed her plan on how the UK will leave the bloc in Mar of next year.  The special summit was largely symbolic and the agreement was widely expected to be approved, despite last-minute concerns from Spain on whether it will have a say on the future of Gibraltar, a disputed British territory that lies on the southern tip of the Mediterranean nation.  European Commission President Jean-Claude Juncker reiterated his sadness at the UK's departure, telling reporters that it was a "tragedy."  But he backed May's plan & said it was the best deal possible for Britain.  Other European leaders also spoke favorably of the agreement, with Dutch leader Mark Rutte saying it was balanced on both sides.  But the EU's acceptance of the deal has enraged some pro-Brexit politicians in the UK who believe that May is making too many concessions to the EU.  May faces a tough challenge next month when she needs to gain Parliamentary approval for the deal in Westminster.  The vote, likely to be on Dec 11, is crucial for May to move forward with Brexit & failure could lead to her being toppled as leader or even the UK crashing out of the EU without a deal.  Yesterday, she appeared to swerve questions from reporters on whether she would resign if the deal was rejected by Parliament.  Lawmakers in the opposition Labour party, the Liberal Democrats & the Scottish National Party have all indicated that they will vote against the deal.  The Northern Irish DUP (Democratic Unionist Party) party, which is propping up May's gov in Parliament, also said it would vote against it, with its deputy leader saying it would leave Britain in a "pitiful and pathetic place."  Even pro-Brexit & pro-Remain lawmakers within May's own Conservative Party have said they will vote against her, meaning approval is anything but assured.  But May has resolutely defended her plan at every stage.  She has called on business leaders & UK citizens to back her, even if many politicians will not.  Yesterday May wrote a letter to the British public pleading for support, promising a "brighter future" for the UK.  "It will be a deal that is in our national interest — one that works for our whole country and all of our people, whether you voted 'Leave' or 'Remain'," she wrote.  "It will honor the result of the referendum."

EU backs UK leader Theresa May's Brexit deal at historic summit

Buyers took command of the stock market at the open after strong holiday sales were reported & continue to be in charge.  Higher oil prices added to the positive thinking towards stocks.  The next challenge for the bulls is to get the Dow over 25K, about 350 away.

Dow Jones Industrials

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