Dow fell 70, advancers over decliners about 2-1 & NAZ went up 20. The MLP index fell fractionally to the 256s (extending its sideways trading pattern) & the REIT index was little changed in the 386s. Junk bond funds crawled higher & Treasuries rose in price. Oil climbed to the 57s as US supplies declined again & gold gained 4 to 1425 (still near multi year highs).
AMJ (Alerian MLP Index tracking fund)
Sales of new US single-family homes rebounded sharply in Jun, but sales for the prior 3 months were revised down, indicating that the housing market continued to tread water despite lower mortgage rates & a strong labor market. The Commerce Dept said new home sales rebounded 7.0% to a seasonally adjusted annual rate of 646K units last month. May's sales pace was revised down to 604K units from the previously reported 626K units. Data for Mar & Apr was also revised down. The forecast for new home sales, which account for about 11% of housing market sales, increasing 6.0% to a pace of 660K units in Jun. New home sales are drawn from permits & tend to be volatile on a month-to-month basis. Sales increased 4.5% from a year ago. The median new house price was unchanged at $310K in Jun from a year ago. Despite cheaper mortgage rates & the lowest unemployment rate in nearly 50 years supporting demand for housing, expensive materials & land & labor shortages are constraining builders' ability to produce more affordable housing. The housing market hit a soft patch last year & has since struggled to gain traction, with residential investment contracting for 5 straight quarters. A report yesterday showed home resales tumbled in Jun as tight supply pushed previously owned house prices to a record high. While single-family homebuilding rebounded in Jun, permits increased moderately & continued to lag housing starts. The 30-year fixed mortgage rate has dropped to an average of 3.81% from a more than 7-year peak of 4.94% in Nov, according to data from mortgage finance agency Freddie Mac.
US new home sales rise; prior three months revised down
Mnuchin says he’s headed to China next week for trade talks, but there are still ‘a lot of issues’
The Federal Trade Commission has formally announced its approval of a $5B settlement with Facebook (FB) over the company's privacy policies. The fine is the largest ever imposed by the FTC against a tech company. The previous high was a $22.5M fine in 2012 against Google (GOOG) for its privacy practices. The $5B fine against FB represents approximately 9% of the company's 2018 revenue. The 20-year settlement, which was approved in a 3-2 vote by the agency’s commissioners, also includes provisions that aim to create a level of independence from CEO Mark Zuckerberg's decision-making. Separately, the SEC announced it's charging FB with making misleading disclosures about the risk of misuse of user data. The SEC alleged FB described data misuse as hypothetical to investors when it was aware of real instances of misuse. The company agreed to pay $100M to settle the charges, according to the SEC. The SEC's deputy director of enforcement Stephanie Avakian said the $100M figure represents the “highest penalty the SEC has ever assessed for this kind of disclosure failure.” The FTC order mandates that FB create an independent privacy committee on its board of directors to remove “unfettered control” by Zuckerberg over user privacy decisions. The members will be nominated by an independent nominating committee & can only be fired by a 2/3 of voting shares, which would prevent Zuckerberg from controlling the vote with his share power. The stock fell only 83¢.
If you would like to learn more about FB, click on this link:
club.ino.com/trend/analysis/stock/FB?a_aid=CD3289&a_bid=6ae5b6f7
FTC slaps Facebook with record $5 billion fine, orders privacy oversight
Disappointing earnings at CAT & BA along with a record fine at FB did not disturb investors. The bulls, very optimistic about the future, are keeping the popular stock averages at or essentially at record highs. Meanwhile negative thinkers continue to buy gold. The future for stocks is more uncertain than usual!
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CL=F | Crude Oil | 57.12 | +0.35 | +0.6% |
| GC=F | Gold | 1,427.90 | +6.20 | +0.4% |
Stocks opened with declines as
investors reacted to the news of upcoming trade talks between the US & China, as well as a probe by the Trump administration into Silicon
Valley giants & disappointing earnings from Dow stocks Boeing (BA) & Caterpillar (CAT). Despite the decreases, the Dow, S&P 500 & NAZ still remain near record-territory. CAT
reported $14.43B in revenue & EPS of $2.83, both
below analyst expectations. BA also missed
projections, reporting an EPS of $5.21 compared to
predictions of $1.87. Revenue was $15.8B, far less than the expected $18.55B. While
early, 79% of companies that have reported earnings exceeded
earnings projections, while 65% beat revenue predictions.
Overall, S&P 500 earnings are up 8.7% from 2018. US Trade Representative Robert Lighthizer &
Treasury Secretary Steve Mnuchin are heading to Shanghai next week to
meet with their Chinese counterparts – Vice Premier Liu He & Commerce
Minister Zhong Shan. The talks are aimed at
restarting negotiations after Trump & Chinese President Xi Jinping
reached a deal in Jun to withhold the imposition of new tariffs as the
two nations seek to craft a trade deal.
STOCKS LOWER BUT STILL NEAR RECORD TERRITORY AFTER BOEING, CATERPILLAR 2Q EARNINGS DISAPPOINT
Sales of new US single-family homes rebounded sharply in Jun, but sales for the prior 3 months were revised down, indicating that the housing market continued to tread water despite lower mortgage rates & a strong labor market. The Commerce Dept said new home sales rebounded 7.0% to a seasonally adjusted annual rate of 646K units last month. May's sales pace was revised down to 604K units from the previously reported 626K units. Data for Mar & Apr was also revised down. The forecast for new home sales, which account for about 11% of housing market sales, increasing 6.0% to a pace of 660K units in Jun. New home sales are drawn from permits & tend to be volatile on a month-to-month basis. Sales increased 4.5% from a year ago. The median new house price was unchanged at $310K in Jun from a year ago. Despite cheaper mortgage rates & the lowest unemployment rate in nearly 50 years supporting demand for housing, expensive materials & land & labor shortages are constraining builders' ability to produce more affordable housing. The housing market hit a soft patch last year & has since struggled to gain traction, with residential investment contracting for 5 straight quarters. A report yesterday showed home resales tumbled in Jun as tight supply pushed previously owned house prices to a record high. While single-family homebuilding rebounded in Jun, permits increased moderately & continued to lag housing starts. The 30-year fixed mortgage rate has dropped to an average of 3.81% from a more than 7-year peak of 4.94% in Nov, according to data from mortgage finance agency Freddie Mac.
US new home sales rise; prior three months revised down
Treasury Secretary Steve Mnuchin expressed optimism about next week's trade talks with China
as the administration pushes looks to resolve a critical geopolitical
issue. He said he & Trade Representative Robert Lighthizer are
leading a team that will head to Shanghai on Mon for a 2-day
meeting starting Tues. "I would say there are a lot of issues," Mnuchin said. "My expectations
is this will be followed up with a meeting back in D.C. after this and
hopefully we'll continue to progress." The negotiations come with high expectations by US investors. US
companies are feeling the pressure of tariffs that have come in a
tit-for-tat battle between the 2 countries. Mnuchin
noted the symbolism of the 2 sides meeting in Shanghai — the Shanghai
Communique of 1972 was considered an important step in normalizing
relations between the US & China. "Hopefully, I'll take that as good news that we'll be making progress next week," he added. Mnuchin's office later released an official statement on the planned visit: "At the direction of President Donald J. Trump, United States Trade
Representative Robert Lighthizer and Secretary of the Treasury Steven
Mnuchin will travel to Shanghai, China, to continue negotiations aimed
at improving the trade relationship between the United States and China.
The talks will begin on July 30. Vice Premier Liu He will lead the
talks for China." "The discussions will cover a range of issues,
including intellectual property, forced technology transfer, non-tariff
barriers, agriculture, services, the trade deficit, and enforcement."
Mnuchin says he’s headed to China next week for trade talks, but there are still ‘a lot of issues’
The Federal Trade Commission has formally announced its approval of a $5B settlement with Facebook (FB) over the company's privacy policies. The fine is the largest ever imposed by the FTC against a tech company. The previous high was a $22.5M fine in 2012 against Google (GOOG) for its privacy practices. The $5B fine against FB represents approximately 9% of the company's 2018 revenue. The 20-year settlement, which was approved in a 3-2 vote by the agency’s commissioners, also includes provisions that aim to create a level of independence from CEO Mark Zuckerberg's decision-making. Separately, the SEC announced it's charging FB with making misleading disclosures about the risk of misuse of user data. The SEC alleged FB described data misuse as hypothetical to investors when it was aware of real instances of misuse. The company agreed to pay $100M to settle the charges, according to the SEC. The SEC's deputy director of enforcement Stephanie Avakian said the $100M figure represents the “highest penalty the SEC has ever assessed for this kind of disclosure failure.” The FTC order mandates that FB create an independent privacy committee on its board of directors to remove “unfettered control” by Zuckerberg over user privacy decisions. The members will be nominated by an independent nominating committee & can only be fired by a 2/3 of voting shares, which would prevent Zuckerberg from controlling the vote with his share power. The stock fell only 83¢.
If you would like to learn more about FB, click on this link:
club.ino.com/trend/analysis/stock/FB?a_aid=CD3289&a_bid=6ae5b6f7
FTC slaps Facebook with record $5 billion fine, orders privacy oversight
Disappointing earnings at CAT & BA along with a record fine at FB did not disturb investors. The bulls, very optimistic about the future, are keeping the popular stock averages at or essentially at record highs. Meanwhile negative thinkers continue to buy gold. The future for stocks is more uncertain than usual!
Dow Jones Industrials
No comments:
Post a Comment