Dow went up 33 after spending most of the day in the red & finishing at the high, advancers only slightly ahead of decliners & NAZ gained 32. The MLP index fluctuated near 240 & the REIT index added 4+ to the 407s. Junk bond funds were mixed & Treasuries rose modestly in price. Oil declined almost 4 to 59 & gold was flattish near 1510 (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)
Boeing (BA), a Dow stock, has claimed that growing Chinese demand for planes will generate almost $3T worth of industry business over the next 2 decades. In its latest market outlook, the plane maker predicts China will soon become the world's largest aviation market & will need 8090 new planes by 2038. The company believes within a decade that one-in-5 airline passengers will be Chinese. The figure would equate to $1.3T in current list prices. BA said associated services to maintain fleets would be even larger at $1.6T, meaning almost $3T worth of business could be up for grabs. BA has said passenger traffic within China is tipped to grow at more than 6% a year until 2038 & China's middle class is expected to double in size within a decade. While domestic flights are predicted to provide the lion's share of growth, outward bound intl travel will also increase. “An expanding middle class, significant investment in infrastructure, and advanced technologies that make airplanes more capable and efficient, continue to drive tremendous demand for air travel,” said Randy Tinseth, VP of commercial marketing for BA said. China's need for new & replacement planes between now & 2038 are broken down by BA's analysts into 5960 single-aisle jets, 1780 widebody planes, 230 freighters & 120 regional jets. On a global basis, BA is projecting $6.8T worth of airplane sales by 2038 with a further $9.1T in services. More than 2000 BA planes have already been delivered to China with around a qtr of the plane makers production line now delivered to Chinese customers. BA has said 1/3 of its 737 planes are currently delivered to China. The 737 Completion & Delivery Center in Zhoushan is a joint venture between BA & Commercial Aircraft Corporation of China (COMAC). It was built to provide interior furnishings & exterior paint to planes that have arrived from Seattle. In Dec last year, Air China received a 737 Max 8 which was the first BA plane to be completed in China for a local customer. But on Mar 11, China ordered its airlines to suspend operations of their 737 MAX 8 planes following 2 fatal crashes of the model within 5 months. In a sign of China's growing importance as an aviation regulator, most other agencies & airlines followed suit over the next 2 days. The stock gained 5+ to the 584s.
If you would like to learn more about BA, click on this link:
club.ino.com/trend/analysis/stock/BA?a_aid=CD3289&a_bid=6ae5b6f7
Boeing values China’s aircraft business at almost $3 trillion over the next two decades
Oil futures dropped sharply after Saudi Arabia's energy minister said the kingdom's crude production could return to normal as soon as the end of the month, as the nation recovers from weekend attacks on crucial processing facilities. Fear of a prolonged disruption to output from Saudi Arabia, the biggest producer of oil in the world, sent ripples through global energy markets & drove intl futures prices to one of the sharpest rallies on record. Saudi Arabia’s energy minister Prince Abdulaziz bin Salman said at a news conference that Saudi Aramco has already restored 50% of lost production since the attacks. It has been reported that the facility is already supplying customers at pre-attack levels. Oil prices today had been trading sharply lower, a report that the Saudis were close to restoring 70% of the estimated 5.7M-barrels-per-day of production lost after parts of the oil-processing facility were damaged. West Texas Intermediate crude for Oct, the US benchmark contract, fell $3.56 (5.7%) to settle at $59.34 a barrel. Yesterday, it posted the largest daily gain for the most-active contract since 2008 & finished at its highest level since May. Nov Brent crude lost $4.47 (6.5%) to end at $64.55 a barrel, following the intl benchmark contract's 14.6% rise yesterday, the sharpest percentage gain on record. Analysts forecast a fall of 2M barrels in last week's crude inventories. Gasoline stockpiles were expected to fall by 800K barrels, but distillate supplies were seen higher by 300K barrels.
Gold futures marked a 2nd gain in a row, extending a climb to the highest price in about a week. Traders continued to monitor developments tied to the attacks on Saudi Arabian oil-infrastructure as they shifted focus to the Federal Reserve decision tomorrow on interest rates. Dec gold tacked on $1.90 to settle at $1513 an ounce, after a 0.8% gain yesterday. Prices for the most-active contract marked their highest settlement since Sep 6 for a 2nd straight session. Gold's modest moves come as a response to the Saudi energy attacks appear unlikely to result in near-term retaliatory measures from Riyadh or DC. A report yesterday said US intelligence forces shared evidence that Iran was involved in the Sat attack on Saudi Aramco's oil-processing facilities. Iran has denied any involvement in the weekend strike. Saudi officials said there wasn't sufficient evidence to definitively blame Tehran. Markets are slowly shifting focus to central-bank policy, with the Federal Reserve will conclude its 2-day policy gathering tomorrow, with its monetary policy statement. The Fed is expected to cut its benchmark interest rate by a qtr percentage point to 1.75-2%, marking the 2nd rate cut this year & Chair Jerome Powell is likely to outline reasons for not signaling a full easing cycle, which could influence trade in assets including gold. Ahead of the policy statement, US economic data were upbeat, with industrial production up 0.6% in Aug, the largest gain in a year & the home-builder confidence index up one point to 68 in Sep.
Gold notches second straight gain, adds to climb toward 1-week high
The disruption in oil supplies from Saudi Arabia was taken calmly by the US stock markets. As pointed out above, it knows how to run the business & the production should be back to normal by the end off the month. The stock averages began the day in the red, but there was enough buying in the last hour to bring them into the black. Investors are betting on a rate cut tomorrow & kind words about future reductions.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
US retailers are on track for a big holiday, according to an annual survey from Deloitte. The
consultancy firm sees retail sales surging 4.5-5% during the Nov-Jan timeframe as retailers rake in
$1.1T in sales. Last holiday season, retail sales rose 3.1% on $1.09T of sales, according to the Census Bureau. “The projected holiday season growth is, in part, due to the current health of the labor market,” said Daniel Bachman, Deloitte's US economic forecaster. “Near
record-low unemployment rates, coupled with continued monthly job
creation, may encourage people to spend more during the holiday season.
The economy is still growing, albeit at a slower rate. Additionally, we
continue to see consumer confidence elevated, which also helps boost
holiday spending.” The
unemployment rate in Aug held at 3.7%, near a 50-year
low, as average hourly wages rose at a 3.2% year-over-year pace.
The US economy grew at a 2% rate in Q2, down
from 3.1% in Q1. Deloitte's forecast comes a little more than a month after the Office of the Trade Representative said it would delay tariffs on certain Chinese goods, cell phones, laptop computers,
video game consoles, toys, computer monitors, kitchen items, sports
equipment, footwear & clothing until Dec 15, after the majority of
holiday shopping is completed. “We’re doing
this for Christmas season, just in case some of the tariffs would have
an impact on U.S. customers, which so far – they’ve had virtually
none,” Trump told reporters. “They won’t be relevant to the Christmas shopping season.” A
separate forecast released today by AlixPartners sees retail sales
rising 4.4-5.3% this holiday season despite
“unprecedented uncertainty.” “From on-again,
off-again tariffs, to a growing chorus concerned about a recession, a
looming election and geopolitical uncertainty, this season is unlike any
in recent memory,” said Joel Bines, global co-leader of the retail
practice at AlixPartners. “While our forecast is bullish, we are nevertheless advising clients to be nimble.”
Boeing (BA), a Dow stock, has claimed that growing Chinese demand for planes will generate almost $3T worth of industry business over the next 2 decades. In its latest market outlook, the plane maker predicts China will soon become the world's largest aviation market & will need 8090 new planes by 2038. The company believes within a decade that one-in-5 airline passengers will be Chinese. The figure would equate to $1.3T in current list prices. BA said associated services to maintain fleets would be even larger at $1.6T, meaning almost $3T worth of business could be up for grabs. BA has said passenger traffic within China is tipped to grow at more than 6% a year until 2038 & China's middle class is expected to double in size within a decade. While domestic flights are predicted to provide the lion's share of growth, outward bound intl travel will also increase. “An expanding middle class, significant investment in infrastructure, and advanced technologies that make airplanes more capable and efficient, continue to drive tremendous demand for air travel,” said Randy Tinseth, VP of commercial marketing for BA said. China's need for new & replacement planes between now & 2038 are broken down by BA's analysts into 5960 single-aisle jets, 1780 widebody planes, 230 freighters & 120 regional jets. On a global basis, BA is projecting $6.8T worth of airplane sales by 2038 with a further $9.1T in services. More than 2000 BA planes have already been delivered to China with around a qtr of the plane makers production line now delivered to Chinese customers. BA has said 1/3 of its 737 planes are currently delivered to China. The 737 Completion & Delivery Center in Zhoushan is a joint venture between BA & Commercial Aircraft Corporation of China (COMAC). It was built to provide interior furnishings & exterior paint to planes that have arrived from Seattle. In Dec last year, Air China received a 737 Max 8 which was the first BA plane to be completed in China for a local customer. But on Mar 11, China ordered its airlines to suspend operations of their 737 MAX 8 planes following 2 fatal crashes of the model within 5 months. In a sign of China's growing importance as an aviation regulator, most other agencies & airlines followed suit over the next 2 days. The stock gained 5+ to the 584s.
If you would like to learn more about BA, click on this link:
club.ino.com/trend/analysis/stock/BA?a_aid=CD3289&a_bid=6ae5b6f7
Boeing values China’s aircraft business at almost $3 trillion over the next two decades
Oil futures dropped sharply after Saudi Arabia's energy minister said the kingdom's crude production could return to normal as soon as the end of the month, as the nation recovers from weekend attacks on crucial processing facilities. Fear of a prolonged disruption to output from Saudi Arabia, the biggest producer of oil in the world, sent ripples through global energy markets & drove intl futures prices to one of the sharpest rallies on record. Saudi Arabia’s energy minister Prince Abdulaziz bin Salman said at a news conference that Saudi Aramco has already restored 50% of lost production since the attacks. It has been reported that the facility is already supplying customers at pre-attack levels. Oil prices today had been trading sharply lower, a report that the Saudis were close to restoring 70% of the estimated 5.7M-barrels-per-day of production lost after parts of the oil-processing facility were damaged. West Texas Intermediate crude for Oct, the US benchmark contract, fell $3.56 (5.7%) to settle at $59.34 a barrel. Yesterday, it posted the largest daily gain for the most-active contract since 2008 & finished at its highest level since May. Nov Brent crude lost $4.47 (6.5%) to end at $64.55 a barrel, following the intl benchmark contract's 14.6% rise yesterday, the sharpest percentage gain on record. Analysts forecast a fall of 2M barrels in last week's crude inventories. Gasoline stockpiles were expected to fall by 800K barrels, but distillate supplies were seen higher by 300K barrels.
Oil ends sharply lower as Saudis project early return to normal for damaged facilities
Gold futures marked a 2nd gain in a row, extending a climb to the highest price in about a week. Traders continued to monitor developments tied to the attacks on Saudi Arabian oil-infrastructure as they shifted focus to the Federal Reserve decision tomorrow on interest rates. Dec gold tacked on $1.90 to settle at $1513 an ounce, after a 0.8% gain yesterday. Prices for the most-active contract marked their highest settlement since Sep 6 for a 2nd straight session. Gold's modest moves come as a response to the Saudi energy attacks appear unlikely to result in near-term retaliatory measures from Riyadh or DC. A report yesterday said US intelligence forces shared evidence that Iran was involved in the Sat attack on Saudi Aramco's oil-processing facilities. Iran has denied any involvement in the weekend strike. Saudi officials said there wasn't sufficient evidence to definitively blame Tehran. Markets are slowly shifting focus to central-bank policy, with the Federal Reserve will conclude its 2-day policy gathering tomorrow, with its monetary policy statement. The Fed is expected to cut its benchmark interest rate by a qtr percentage point to 1.75-2%, marking the 2nd rate cut this year & Chair Jerome Powell is likely to outline reasons for not signaling a full easing cycle, which could influence trade in assets including gold. Ahead of the policy statement, US economic data were upbeat, with industrial production up 0.6% in Aug, the largest gain in a year & the home-builder confidence index up one point to 68 in Sep.
Gold notches second straight gain, adds to climb toward 1-week high
The disruption in oil supplies from Saudi Arabia was taken calmly by the US stock markets. As pointed out above, it knows how to run the business & the production should be back to normal by the end off the month. The stock averages began the day in the red, but there was enough buying in the last hour to bring them into the black. Investors are betting on a rate cut tomorrow & kind words about future reductions.
Dow Jones Industrials
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