Dow sank 128 (not far from session lows), decliners over advancers 5-2 & NAZ tumbled 82 on worries about big tech earnings. The MLP index lost 1+ to the 255s & the REIT index gave back 2+ to the 384s. Junk bond funds hardly budged in price & Treasuries were sold. Oil crawled higher in the 56s & gold dropped 8 to 1414 (much more below).
AMJ (Alerian MLP Index tracking fund)
![Live 24 hours gold chart [Kitco Inc.]](https://www.kitco.com/images/live/gold.gif?0.2180338269244485)
club.ino.com/trend/analysis/stock/MMM?a_aid=CD3289&a_bid=6ae5b6f7
3M profit slides 39%, reiterates 2019 profit outlook
Ford (F) shares plunged after the automaker reported Q2 earnings that were short of expectations & issued a disappointing forecast for the year. Ford, which has slashed thousands of jobs this year, is also investing $11B by 2022 in electric & hybrid vehicles to try to keep pace in a changing industry. “Midway through this key year of action, we are pleased with the progress we are making toward creating a more dynamic and profitable business,” CEO Jim Hackett said. “In this time of profound change in our industry, Ford has amazing opportunities to delight customers, innovate and collaborate in new ways, and create value.” Q2 EPS was 4¢, hurt mainly by efforts to restructure its business in Europe & South America. Excluding these charges, EPS was 28¢, which was lower than the 31¢ estimate. Those results included a loss from an investment the company made in Pivotal Software. Excluding this item, Ford would have earned 32¢. Total revenue fell to $38.85B from $38.92B a year earlier, & automotive revenue inched up to $35.76B, topping estimates of $35.07B. Most of Q2 profit came from North America. The company boasted a small profit in Europe, but posted a loss in China. Q2 sales in China fell 21.7%. The China team has taken actions to stabilize sales & has “aggressively” reduced inventory, which finished the qtr at its lowest level in the past 18 months. Jim Hackett said that the company is looking to double profitability in commercial vehicles in Europe over the next 5 years. Ford CFO Tim Stone added that the company, which is in early stages of restructuring, is starting to see improvements in free cash flow. He expects even better results in H2-2019 as restructuring progresses & more SUVs hit the market. Ford now expects EPS will be $1.20-1.35, on an adjusted basis, in 2019 compared with $1.30 per share a year earlier. This was the first time Ford had issued an earning forecast for the year & it was below the $1.39 analysts were expecting. The stock sank 81¢.
If you would like to learn more about Ford, click on this link:
club.ino.com/trend/analysis/stock/F?a_aid=CD3289&a_bid=6ae5b6f7
Ford shares plunge after earnings fall short, 2019 forecast disappoints
The number of Americans applying for first-time unemployment benefits fell last week for the 3rd time in 4 weeks, a sign of a firm labor market. Initial jobless claims, a measure of how many workers were laid off across the US, decreased by 10K to a seasonally adjusted 206K last week, the Labor Dept said. The forecast called for 220K new claims.
Gold futures settled sharply lower, reversing a morning climb, after the ECB's decision to signal its plan to ease monetary policy disappointed investors by not including immediate action or details of its likly efforts. The ECB said it stood ready to cut interest rates & deliver “highly accommodative” monetary policy, including additional asset purchases, in its effort to push stubbornly low inflation back toward its target amid signs of deteriorating economic conditions in the eurozone. Aug gold lost $8.90 (0.6%) to finish at $1414 an ounce, marking its sharpest slide since Jul 5 when the most-active contract fell $20.80 (1.5%). Bullion's reversal, after touching an intraday peak at $1434 an ounce, came as investors digested comments from ECB President Mario Draghi, as well as slightly better-than-expected US economic data which may downgrade the case for aggressive action by the Federal Reserve when its rate-setting committee convenes next week. The announcement comes as the Fed is widely expected to cut interest rates by a qtr-of-a-percentage point at the end of its Jul 30-31 gathering next week. Market participants lamented that Draghi didn’t offer details. The € initially dived following the statement, while European bonds rallied, pushing down yields. Those moves were mostly reversed during Draghi's news conference with reporters. The direction change for many asset prices also occurred as new US applications for jobless benefits fell to 206K last week, below the 218K expected, near historic lows, while US orders for long-lasting manufactured goods rose in 2% in Jun, above the 0.7% increase expected & the 2.3% decline in May. The data may support worries that the Fed may be less inclined to lower interest rates aggressively because the economy remains mostly healthy.
Economic data was just good enough to create doubts about the widely expected rate increase by the Fed next week. Earnings are coming in only so-so with some the big techies to report shortly. Then there is GDP data for Q2 coming tomorrow before the market open. That's a lot to make traders nervous & they were selling today.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
Dow stock 3M (MMM), a Dividend Aristocrat, reported
a 39% drop in quarterly profit, but reiterated its
full-year earnings forecast as it fought the impact of slowing global
growth. MMM in
Apr decided to cut 2K jobs as weak demand in the China's automotive & electronics sectors led the company to cut production to better
align its output with demand. "Our execution was strong in the face of continued slow growth
conditions in key end markets, as we effectively managed costs and
improved cash flow," CEO Mike Roman said. Sales fell in key markets including Asia Pacific but expanded 2% in the US. EPS was $1.92 in Q2, down from $3.07 a year earlier. The maker of Post-it notes & Scotch tape had EPS of $2.20 on an adjusted basis. Net sales fell 2.6% to $8.2B. The stock dropped 1.25.
If you would like to learn more about MMM, click on this link:club.ino.com/trend/analysis/stock/MMM?a_aid=CD3289&a_bid=6ae5b6f7
3M profit slides 39%, reiterates 2019 profit outlook
Ford (F) shares plunged after the automaker reported Q2 earnings that were short of expectations & issued a disappointing forecast for the year. Ford, which has slashed thousands of jobs this year, is also investing $11B by 2022 in electric & hybrid vehicles to try to keep pace in a changing industry. “Midway through this key year of action, we are pleased with the progress we are making toward creating a more dynamic and profitable business,” CEO Jim Hackett said. “In this time of profound change in our industry, Ford has amazing opportunities to delight customers, innovate and collaborate in new ways, and create value.” Q2 EPS was 4¢, hurt mainly by efforts to restructure its business in Europe & South America. Excluding these charges, EPS was 28¢, which was lower than the 31¢ estimate. Those results included a loss from an investment the company made in Pivotal Software. Excluding this item, Ford would have earned 32¢. Total revenue fell to $38.85B from $38.92B a year earlier, & automotive revenue inched up to $35.76B, topping estimates of $35.07B. Most of Q2 profit came from North America. The company boasted a small profit in Europe, but posted a loss in China. Q2 sales in China fell 21.7%. The China team has taken actions to stabilize sales & has “aggressively” reduced inventory, which finished the qtr at its lowest level in the past 18 months. Jim Hackett said that the company is looking to double profitability in commercial vehicles in Europe over the next 5 years. Ford CFO Tim Stone added that the company, which is in early stages of restructuring, is starting to see improvements in free cash flow. He expects even better results in H2-2019 as restructuring progresses & more SUVs hit the market. Ford now expects EPS will be $1.20-1.35, on an adjusted basis, in 2019 compared with $1.30 per share a year earlier. This was the first time Ford had issued an earning forecast for the year & it was below the $1.39 analysts were expecting. The stock sank 81¢.
If you would like to learn more about Ford, click on this link:
club.ino.com/trend/analysis/stock/F?a_aid=CD3289&a_bid=6ae5b6f7
Ford shares plunge after earnings fall short, 2019 forecast disappoints
Demand for long-lasting goods produced in US factories rose in
Jun after 2 straight months of declines, driven by new orders for
transportation goods, particularly civilian aircraft. Overall
orders for durable goods, manufactured products intended to last at least 3 years, rose 2% in Jun from the previous month, the Commerce
Dept reported. That was the fastest rate of growth since
Aug of last year. The forecast expected a 0.5% increase.
U.S. Durable Goods Orders Rose in June
The number of Americans applying for first-time unemployment benefits fell last week for the 3rd time in 4 weeks, a sign of a firm labor market. Initial jobless claims, a measure of how many workers were laid off across the US, decreased by 10K to a seasonally adjusted 206K last week, the Labor Dept said. The forecast called for 220K new claims.
U.S. Jobless Claims Decreased Last Week
Gold futures settled sharply lower, reversing a morning climb, after the ECB's decision to signal its plan to ease monetary policy disappointed investors by not including immediate action or details of its likly efforts. The ECB said it stood ready to cut interest rates & deliver “highly accommodative” monetary policy, including additional asset purchases, in its effort to push stubbornly low inflation back toward its target amid signs of deteriorating economic conditions in the eurozone. Aug gold lost $8.90 (0.6%) to finish at $1414 an ounce, marking its sharpest slide since Jul 5 when the most-active contract fell $20.80 (1.5%). Bullion's reversal, after touching an intraday peak at $1434 an ounce, came as investors digested comments from ECB President Mario Draghi, as well as slightly better-than-expected US economic data which may downgrade the case for aggressive action by the Federal Reserve when its rate-setting committee convenes next week. The announcement comes as the Fed is widely expected to cut interest rates by a qtr-of-a-percentage point at the end of its Jul 30-31 gathering next week. Market participants lamented that Draghi didn’t offer details. The € initially dived following the statement, while European bonds rallied, pushing down yields. Those moves were mostly reversed during Draghi's news conference with reporters. The direction change for many asset prices also occurred as new US applications for jobless benefits fell to 206K last week, below the 218K expected, near historic lows, while US orders for long-lasting manufactured goods rose in 2% in Jun, above the 0.7% increase expected & the 2.3% decline in May. The data may support worries that the Fed may be less inclined to lower interest rates aggressively because the economy remains mostly healthy.
Gold logs sharpest drop in about 3 weeks
Economic data was just good enough to create doubts about the widely expected rate increase by the Fed next week. Earnings are coming in only so-so with some the big techies to report shortly. Then there is GDP data for Q2 coming tomorrow before the market open. That's a lot to make traders nervous & they were selling today.
Dow Jones Industrials
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