Dow rose 116, advancers over decliners 3-2 & NAZ added 3. The MLP index was steady in the 232s & the REIT index gave back 1+ to 410. Junk bond funds fluctuated & Treasuries were sold today. Oil fell to 56 & gold sank 17 to 1497 as the $ trades at a roughly 2 year high.
AMJ (Alerian MLP Index tracking fund)
Stocks bouncing back after whistleblower concerns shake markets
New orders for key US-made capital goods unexpectedly fell in Aug & shipments rebounded moderately, pointing to continued weakness in business investment after it declined at its steepest pace in 3½ years in Q2. The Commerce Dept said orders for non-defense capital goods excluding aircraft, a closely watched proxy for business spending plans, dropped 0.2% last month amid weak demand for electrical equipment, appliances & components, & computers & electronic products. Data for Jul was revised down to show capital goods orders unchanged instead of gaining 0.2% as previously reported. The forecast for core capital goods orders was unchanged in Aug. Core capital goods orders increased 1.1% on a year-on-year basis. Shipments of core capital goods rose 0.4% last month. Core capital goods shipments are used to calculate equipment spending in GDP. Core capital goods shipments fell by an unrevised 0.6% in Jul. The Trump administration's nearly 15-month trade war with China has been blamed for the downturn in business investment. Federal Reserve Chair Jerome Powell last week said trade policy tensions, which "have waxed and waned, and elevated uncertainty is weighing on U.S. investment and exports," posing an ongoing risk to the longest economic expansion on record, now in its 11th year. Powell said central bank contacts had told policymakers that trade policy uncertainty "has discouraged them from investing in their businesses." The Fed cut interest rates again last Wed after lowering borrowing costs in Jul for the first time since 2008. Business investment declined at a 1.0% annualized rate last qtr, the biggest drop since Q4-2015. Weak business investment is underscored by manufacturing, where output has contracted for 2 straight qtrs. Manufacturing, which accounts for about 11% of the economy, is also being undercut by weak global demand and design problems at planemaker Boeing (BA), a Dow stock. Last month, orders for electrical equipment, appliances & components dropped 1.3%, the most since Nov 2018. There were also decreases in orders for computers & electronic products. But orders for machinery rebounded 0.6%. There were also gains in orders for primary metals & fabricated metal products. Overall orders for durable goods, items ranging from toasters to aircraft that are meant to last 3 years or more, rose 0.2% in Aug after surging 2.0% in the prior month. Orders for transportation equipment fell 0.4% after jumping 7.2% in Jul. Motor vehicles & parts orders decreased 0.8% last month. Orders for non-defense aircraft & parts tumbled 17.1%. BA reported that it had received only 6 aircraft orders in Aug after getting 31 orders in Jul.
Oil slid after Iranian Pre Hassan Rouhani claimed that the US offered to remove all sanctions on Iran in exchange for negotiations. Pres Trump & the State Dept later denied those claims, causing oil to rebound from the lows. WTI crude futures were last down by 0.9% to $55.92 following the report after falling as low as $54.79 & Brent crude futures dropped 1.3% to $61.95. “The German chancellor, the prime minister of England (Britain) and the president of France were in New York and all insisted that this meeting take place. And America says that it will lift the sanctions,” Rouhani said on his official website. “It was up for debate what sanctions will be lifted and they (the United States) had said clearly that we will lift all sanctions.” Trump later said he responded “of course, NO!” to Iran who he said wanted him to lift the sanctions in order to meet. The State Dept called the report “baseless,” adding that the US is committed to zero oil exports from the Iranian regime. Rouhani’s comment came after a series of drones attacked oil facilities in Saudi Arabia on Sep 14, which had forced the kingdom to cut production in ½. The US & some European countries, as well as Saudi Arabia, have blamed the attack on Iran. The Trump administration also announced plans to deploy US forces to the region.
Oil slides after Iran claims US offered to remove sanctions, but Trump denies
Stocks are back to meandering. The excitement over impeachment is not bringing on a lot of selling. But the Mideast situation remains very touchy. US economic continues to be fairly favorable with encouraging data for job seekers, key for a strong economy. The Dow is over 27K & nearing the record highs made in Jul.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CL=F | Crude Oil | 55.71 | -0.70 | -1.2% |
| GC=F | Gold | 1,500.10 | -15.10 | -1.0% |
Stocks opened higher, rebounding from losses spurred by concerns an
impeachment inquiry against Pres Trump will ring more
uncertainty to markets. All 3 major equity averages were trading higher. On the commodities front, West Texas Intermediate crude oil & gold were lower. Treasuries were little changed, with the 10-year yield holding near 1.70%. In Asian, China's Shanghai Composite Index inched higher, but lost 2.5% for the week. It was the final day of
trading before Chinese markets close for a week long holiday. In Europe, all of the major averages were trading higher.
Stocks bouncing back after whistleblower concerns shake markets
The US labor market is the tightest it’s been in nearly 2 decades, at 3.7%, the
national unemployment rate is close to a 50-year low, likely
incentivizing companies to loosen job requirements in a boon to those seeking a new position. For
employers, low employment means fewer people are looking for a job;
according to the Bureau of Labor Statistics. The ratio of
unemployed people to job openings is less than 1-to-1, compared to a
decade ago, when it was 6-to-1. A new report published by Adecco,
the world's largest human resources provider, found that a slew of
companies, 37.3%, have lowered their hiring requirements for
temporary workers. An additional 14.8% plan to loosen those
requirements, while another 17.2% are considering it. That's good news for jobseekers: About 62% of employers said they
lowered the required years of experience they asked for job applicants & another 49.7% said they reduced the education requirements.
About 21% of respondents don't plan to drug test candidates
anymore, & 16% have halted background checks. “The takeaway is clear: U.S. companies realize
they must adapt in order to source temporary talent in such a
candidate-driven market,” the study found. Although
the concern is that lowering application standards could result in a
decrease in the quality & potential of candidates, or potentially
result in the hiring of someone who could pose a safety threat in the
office, the study found the rewards often outweigh the risks. Still,
there are other means for employers to attract new talent, too — like
increasing paychecks. Aug data revealed that over the past year,
however, average hourly earnings have risen a modest 3.2% to
$28.11. While that’s a slight uptick from previous months, it still
represents sluggish pay growth.
BOOMING LABOR MARKET BOOSTS YOUR JOB PROSPECTS
New orders for key US-made capital goods unexpectedly fell in Aug & shipments rebounded moderately, pointing to continued weakness in business investment after it declined at its steepest pace in 3½ years in Q2. The Commerce Dept said orders for non-defense capital goods excluding aircraft, a closely watched proxy for business spending plans, dropped 0.2% last month amid weak demand for electrical equipment, appliances & components, & computers & electronic products. Data for Jul was revised down to show capital goods orders unchanged instead of gaining 0.2% as previously reported. The forecast for core capital goods orders was unchanged in Aug. Core capital goods orders increased 1.1% on a year-on-year basis. Shipments of core capital goods rose 0.4% last month. Core capital goods shipments are used to calculate equipment spending in GDP. Core capital goods shipments fell by an unrevised 0.6% in Jul. The Trump administration's nearly 15-month trade war with China has been blamed for the downturn in business investment. Federal Reserve Chair Jerome Powell last week said trade policy tensions, which "have waxed and waned, and elevated uncertainty is weighing on U.S. investment and exports," posing an ongoing risk to the longest economic expansion on record, now in its 11th year. Powell said central bank contacts had told policymakers that trade policy uncertainty "has discouraged them from investing in their businesses." The Fed cut interest rates again last Wed after lowering borrowing costs in Jul for the first time since 2008. Business investment declined at a 1.0% annualized rate last qtr, the biggest drop since Q4-2015. Weak business investment is underscored by manufacturing, where output has contracted for 2 straight qtrs. Manufacturing, which accounts for about 11% of the economy, is also being undercut by weak global demand and design problems at planemaker Boeing (BA), a Dow stock. Last month, orders for electrical equipment, appliances & components dropped 1.3%, the most since Nov 2018. There were also decreases in orders for computers & electronic products. But orders for machinery rebounded 0.6%. There were also gains in orders for primary metals & fabricated metal products. Overall orders for durable goods, items ranging from toasters to aircraft that are meant to last 3 years or more, rose 0.2% in Aug after surging 2.0% in the prior month. Orders for transportation equipment fell 0.4% after jumping 7.2% in Jul. Motor vehicles & parts orders decreased 0.8% last month. Orders for non-defense aircraft & parts tumbled 17.1%. BA reported that it had received only 6 aircraft orders in Aug after getting 31 orders in Jul.
Oil slid after Iranian Pre Hassan Rouhani claimed that the US offered to remove all sanctions on Iran in exchange for negotiations. Pres Trump & the State Dept later denied those claims, causing oil to rebound from the lows. WTI crude futures were last down by 0.9% to $55.92 following the report after falling as low as $54.79 & Brent crude futures dropped 1.3% to $61.95. “The German chancellor, the prime minister of England (Britain) and the president of France were in New York and all insisted that this meeting take place. And America says that it will lift the sanctions,” Rouhani said on his official website. “It was up for debate what sanctions will be lifted and they (the United States) had said clearly that we will lift all sanctions.” Trump later said he responded “of course, NO!” to Iran who he said wanted him to lift the sanctions in order to meet. The State Dept called the report “baseless,” adding that the US is committed to zero oil exports from the Iranian regime. Rouhani’s comment came after a series of drones attacked oil facilities in Saudi Arabia on Sep 14, which had forced the kingdom to cut production in ½. The US & some European countries, as well as Saudi Arabia, have blamed the attack on Iran. The Trump administration also announced plans to deploy US forces to the region.
Oil slides after Iran claims US offered to remove sanctions, but Trump denies
Stocks are back to meandering. The excitement over impeachment is not bringing on a lot of selling. But the Mideast situation remains very touchy. US economic continues to be fairly favorable with encouraging data for job seekers, key for a strong economy. The Dow is over 27K & nearing the record highs made in Jul.
Dow Jones Industrials
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