Dow climbed 11, advancers over decliners 3-2 & NAZ gained 15. The MLP index went up chump change in the 253s & the REIT index declined 3+ to the 374s. Junk bond funds were little changed & Treasuries continued to be sold. Oil finished higher in the 63s & gold fell 6 to 1282 (more on both below).
AMJ (Alerian MLP Index tracking fund)
![Live 24 hours gold chart [Kitco Inc.]](https://www.kitco.com/images/live/gold.gif?0.2180338269244485)
The Treasury expects to borrow $30B in Q2, $53B lower than previously estimated, according to a statement. The new forecast includes an end-of-qtr cash balance of $270B. The dept said the decrease in borrowing was driven by "changes to projections of fiscal activity and cash balance assumptions." Looking ahead to Q3, Treasury said it expects to borrow $160B in net marketable debt with a cash balance of $85B. The US is expected to run out of cash to pay bills sometime in the fall without a debt-limit increase, according to estimates from the CBO. During Q1, Treasury borrowed $374B in net marketable debt & ended with a cash balance of $334B. This was slightly higher than the Treasury's estimate of borrowing of $365B & a cash balance of $320B.
Crude-oil futures ended on a mixed note, with US prices managing to recoup a small portion of last week's loss, but global benchmark prices failing to hold on to modest gains. Uncertainty surrounds OPEC's next move in the wake of Pres Trump's latest call on the Saudis & their allies to boost crude production. The Saudis may have some difficulty in finding an incentive to raise output, however. The Saudis need an oil price of about $85 a barrel to balance its budget this year, up from a forecast of $73 in Sep from the IMF. West Texas Intermediate crude for Jun delivery rose 20¢ (0.3%) to settle at $63.50 a barrel. Prices tumbled 2.9% to settle at $63.30 a barrel on Fri to post a loss of 1.2% for the week, following 7 consecutive weeks of gains. In contrast, Jun Brent crude, the global benchmark, fell 11¢ to settle at $72.04 a barrel after briefly moving higher. The contract, which expires at tommorrow's settlement, fell 3% on Fri. Oil contracts closed off their worst levels on Fri after OPEC's Secretary-General Mohammed Barkindo said he hadn't spoken with Trump & a report said that Saudi Arabia's energy minister Khalid al-Falih wasn't part of those talks either. Trump later tweeted that he had spoken to Saudi Arabia. “Spoke to Saudi Arabia and others about increasing oil flow. All are in agreement.” Trump tweeted on Fri.
Gold futures settled lower after tallying gains in each of the last 3 trading sessions, with investors looking ahead to a busy week for Federal Reserve policy & key US jobs data. Today data showing that profits at Chinese industrial firms grew for the first time in 4 months set a relatively upbeat tone for riskier global stock markets, nicking precious metals prices. Some strength in the US stock market also helped to dull investor interest in gold. Strength in appetite for risky assets, like stocks, can weigh on haven gold, while the $'s recent uptrend can make gold relatively more expensive to intl buyers. Separately, rising bond yields can also dull the luster of gold & other commodities, which offer no yield. Gold futures finished higher Fri & for last week after a quarterly reading of the pace of growth of the US economy came in better than expected for the first 3 months of the year, up 3.2%. But details of the report raised questions about the underlying strength of the economy. There was little fresh evidence in the report to suggest the Federal Reserve would crank up interest-rate hikes soon. Federal Reserve policy makers are fully expected to leave interest rates on hold when they conclude a 2-day meeting on Wed. But the statement & Chairman Jerome Powell's remarks will be closely watched for clues to their thinking. Some investors continue to look for the Fed to cut rates before the end of the year, even after data Fri showed the US economy started 2019 on a stronger-than-expected footing. That's because underlying components of the report on Q1 GDP appeared less impressive &, moreover, due to continued signs that inflation remains subdued. The gov's estimate of Apr jobs growth is due on Frid.
Although trading today remained quiet, the S&P 500 & NAZ were able to reach record levels again. The Dow is about 1% away from its record reached in Oct. Earnings reports always have the potential of creating excitement. In addition Powell & the FOMC will speak & the big jobs report comes on Fri. Trader excitement should increase later this week.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
Top White House economic adviser Larry Kudlow said that the new US-Mexico-Canada Agreement, which will replace NAFTA, will add Bs of $s to the US economy & create hundreds of Ks of jobs. “I
want to put in a plug for USMCA which could produce $100 billion per
year in added GDP. Maybe 170,000 to 180,000 jobs, that’s a huge thing,
American farmers will benefit,” Kudlow said. The Trump administration trade deal to replace the
North American Free Trade Agreement may lead to labor reform laws in
Mexico, a move spearheaded by Trade Representative Robert
Lighthizer. The Mexican labor movement that has kept wages low for the
country could push USMCA closer toward approval. Kudlow said USMCA is “hugely important” to the American economy and he is hopeful Congress will sign the trilateral trade deal.
“We’re hoping that [House] Speaker [Nancy] Pelosi, who’s been very
cooperative so far, will give us a vote in the near future,” he added.
USMCA could generate $100B per year in added GDP: Larry Kudlow
The Treasury expects to borrow $30B in Q2, $53B lower than previously estimated, according to a statement. The new forecast includes an end-of-qtr cash balance of $270B. The dept said the decrease in borrowing was driven by "changes to projections of fiscal activity and cash balance assumptions." Looking ahead to Q3, Treasury said it expects to borrow $160B in net marketable debt with a cash balance of $85B. The US is expected to run out of cash to pay bills sometime in the fall without a debt-limit increase, according to estimates from the CBO. During Q1, Treasury borrowed $374B in net marketable debt & ended with a cash balance of $334B. This was slightly higher than the Treasury's estimate of borrowing of $365B & a cash balance of $320B.
U.S. expects to borrow $30 billion in second quarter
Crude-oil futures ended on a mixed note, with US prices managing to recoup a small portion of last week's loss, but global benchmark prices failing to hold on to modest gains. Uncertainty surrounds OPEC's next move in the wake of Pres Trump's latest call on the Saudis & their allies to boost crude production. The Saudis may have some difficulty in finding an incentive to raise output, however. The Saudis need an oil price of about $85 a barrel to balance its budget this year, up from a forecast of $73 in Sep from the IMF. West Texas Intermediate crude for Jun delivery rose 20¢ (0.3%) to settle at $63.50 a barrel. Prices tumbled 2.9% to settle at $63.30 a barrel on Fri to post a loss of 1.2% for the week, following 7 consecutive weeks of gains. In contrast, Jun Brent crude, the global benchmark, fell 11¢ to settle at $72.04 a barrel after briefly moving higher. The contract, which expires at tommorrow's settlement, fell 3% on Fri. Oil contracts closed off their worst levels on Fri after OPEC's Secretary-General Mohammed Barkindo said he hadn't spoken with Trump & a report said that Saudi Arabia's energy minister Khalid al-Falih wasn't part of those talks either. Trump later tweeted that he had spoken to Saudi Arabia. “Spoke to Saudi Arabia and others about increasing oil flow. All are in agreement.” Trump tweeted on Fri.
Oil ends mixed; uncertainty surrounds OPEC’s next move after Trump’s latest call for output boost
Gold futures settled lower after tallying gains in each of the last 3 trading sessions, with investors looking ahead to a busy week for Federal Reserve policy & key US jobs data. Today data showing that profits at Chinese industrial firms grew for the first time in 4 months set a relatively upbeat tone for riskier global stock markets, nicking precious metals prices. Some strength in the US stock market also helped to dull investor interest in gold. Strength in appetite for risky assets, like stocks, can weigh on haven gold, while the $'s recent uptrend can make gold relatively more expensive to intl buyers. Separately, rising bond yields can also dull the luster of gold & other commodities, which offer no yield. Gold futures finished higher Fri & for last week after a quarterly reading of the pace of growth of the US economy came in better than expected for the first 3 months of the year, up 3.2%. But details of the report raised questions about the underlying strength of the economy. There was little fresh evidence in the report to suggest the Federal Reserve would crank up interest-rate hikes soon. Federal Reserve policy makers are fully expected to leave interest rates on hold when they conclude a 2-day meeting on Wed. But the statement & Chairman Jerome Powell's remarks will be closely watched for clues to their thinking. Some investors continue to look for the Fed to cut rates before the end of the year, even after data Fri showed the US economy started 2019 on a stronger-than-expected footing. That's because underlying components of the report on Q1 GDP appeared less impressive &, moreover, due to continued signs that inflation remains subdued. The gov's estimate of Apr jobs growth is due on Frid.
Gold futures post first loss in 4 sessions
Although trading today remained quiet, the S&P 500 & NAZ were able to reach record levels again. The Dow is about 1% away from its record reached in Oct. Earnings reports always have the potential of creating excitement. In addition Powell & the FOMC will speak & the big jobs report comes on Fri. Trader excitement should increase later this week.
Dow Jones Industrials
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