Dow lost 28, decliners over advancers 5-4 & NAZ jumped up 68. The MLP index slid a little lower in the 221s & the REIT index dipped fractionally to the 416s. Junk bond funds inched higher in price & Treasuries were off slightly. Oil went up pennies in the 56s & gold gained 10 to 1505.
AMJ (Alerian MLP Index tracking fund)
![Live 24 hours gold chart [Kitco Inc.]](https://www.kitco.com/images/live/gold.gif?0.2180338269244485)
China passed a new law that it says will protect the intellectual property rights of foreign businesses operating in the country. "Beijing will not discriminate between domestic and foreign enterprises when enforcing its IP laws,” said Ning Jizhe, the vice chairman of China's National Development & Reform Commission, at a press conference in Beijing. Theft of intellectual property from US companies is a driving concern in Pres Trump's trade war with the world's 2nd-largest economy. American negotiators are seeking to halt forced sharing of trade secrets as a condition of doing business in the country. The US has imposed tariffs on Bs of $s in Chinese imports, driving up costs for businesses, & the 2 countries recently established a framework for a "phase one" deal. Under the new regulations, which take effect on Jan 1, China will "ensure better protection for trade secrets & never allow forced technology transfer," Ning said. "Further, China will strengthen and speed up improvements made to standards for patents, trademarks, copyright infringement, counterfeiting judgments, inspection and identification." The law minimizes the direct allocation of gov resources to the market & direct gov intervention in market activities, & establishes a punitive damages system for intellectual property infringement. China will also deepen trademark registration & patent application reform, among other things. Ning called on the US to do its part. "The other side should also improve the business environment and provide convenience for Chinese-funded enterprises," he said. "China’s intellectual property theft is real, damaging, and ending thanks to President Trump’s strong trade actions and his OSTP Director’s focus on ending abuses in our open society’s education and research system," an administration official said. The tentative US-China deal, which has not yet been signed, is said to include China making concessions on intellectual property, financial services & agriculture. In return, the US agreed not to implement new tariffs on Chinese goods on Oct 15. It is not yet clear if the US will go thru with its next round of tariffs scheduled for Dec 15. The 2 sides are working to complete a written draft for Pres's Trump & Xi Jinping to sign when they are in Chile next month for the Asia-Pacific Economic Cooperation summit. Trump has said a comprehensive trade deal will have 2 or 3 phases.
China purchased 264K more metric tons of soybeans amid US-China trade uncertainty, the Dept of Agriculture said. The purchases were made after Sep 1, which marked the beginning of the "marketing year" for soybeans. Chinese importers purchased roughly 600K tons of US soybeans after deputy-level trade discussions between the US & China in Sep. The soybeans will not be shipped out all at once. The roughly 10 boatloads of soybeans will make their way to China in Oct-Dec. No formal trade deal has been signed by the 2 superpowers. White House trade adviser Peter Navarro said a "phase one" trade deal with China can happen during next month's Asia-Pacific Economic Cooperation (APEC) forum in Chile. "We are on the guiding path to Chile and the meeting of the two presidents in mid-November," he said last week. "The plan there, is to have an agreement."
China buys boatloads of US soybeans ahead of possible deal
Prime Minister Boris Johnson said that the only way to break Britain's Brexit impasse is a general election, & he will ask Parliament to approve a national poll for Dec 12. Johnson said he would ask lawmakers to vote Mon on a motion calling for an early election. Johnson has been mulling his next move since Tues, when lawmakers blocked his attempt to fast-track an EU divorce bill thru Parliament in a matter of days. Lawmakers said they needed more time to scrutinize the legislation, making it all but impossible for Britain to leave the EU on the scheduled date of Oct 31 with a deal. The British gov has been awaiting the EU's decision on whether to postpone the UK's departure to prevent a chaotic no-deal exit. The request for a delay until Jan 31 was ordered by Britain's Parliament to avert the economic damage that could come from a no-deal exit. Though the EU has not given its answer, Johnson said it looked like the EU would grant the extension, & with it kill off Johnson's oft-repeated promise that Britain will leave the EU at the end of this month. "I'm afraid it looks as though our EU friends are going to respond to Parliament's request by having an extension, which I really don't want at all," Johnson added. Britain's next scheduled election is in 2022. If Johnson wants an early election, he needs to win a vote in Parliament by a 2/3 majority, or lose a no-confidence vote, which so far opposition parties have refused to call. The main opposition Labour Party has said it would "support a general election when the threat of a no-deal crash-out is off the table." European Council Pres Donald Tusk has recommended that the other 27 EU nations grant Britain a delay, yet many of the bloc's members are weary & frustrated at Britain's interminable Brexit melodrama. But they also want to avoid the economic pain that would come to both sides from a sudden & disruptive British exit. So they are likely to agree, although politicians in France say Pres Emmanuel Macron is pushing for a shorter extension than the 3 months that Britain has asked for.
Johnson & Johnson (JNJ), a Dow stock & Dividend Aristocrat, lowered its previously reported Q3 profit by $3B to account for a proposed opioid settlement payment. A framework settlement, announced on Mon, was hammered out by some drugmakers & distributors & attorneys general in North Carolina, Pennsylvania, Tennessee & Texas. The proposed deal will need broad support among all the state attorneys general & local govs that have sued the companies over the opioid crisis. JNJ, which is facing thousands of lawsuits over a variety of products, lowered its reported EPS to 66¢ from $1.81 & said there was no impact to its adjusted earnings numbers. The company said it could not predict when or if the opioid deal would be finalized. The drug industry faces roughly 2600 lawsuits brought by state & local govs, hospitals & other entities seeking to hold drugmakers & distributors responsible for the toll of opioid abuse. The stock fell 2.40.
If you would like to learn more about JNJ, click on this link:
club.ino.com/trend/analysis/stock/JNJ?a_aid=CD3289&a_bid=6ae5b6f7
J&J slashes third-quarter profit by $3 billion over proposed opioid deal
Workers at large GM plant in Michigan approve contract
Shares of 3M (MMM), a Dow stock & Dividend Aristocrat. took a dive, after the diversified consumer, industrial & health care products maker beat Q3 profit expectations but missed on revenue & lowered its earnings outlook, citing “challenging” macroeconomic conditions, including slowdowns in the US & China. “We continued to face softness in certain end markets; namely China, automotive and electronics, which represent 30% of our company,” CEO Michael Roman said. The company expects Q4 net EPS of $2.05-2.15, which includes a one-time 15¢ negative impact from the recently completed acquisition of Acclity. The consensus is $2.31 for net EPS & $2.38 for adjusted EPS, which excludes non-recurring items. MMM also lowered its 2019 adjusted EPS guidance to $8.99-9.09 from $9.25-9.75, which compares with the consensus of $9.28. The company also lowered its outlook for return on invested capital (ROIC) to 18.5-19.5% from 20-22%. But China's isn’t the only economy contributing to the downbeat outlook. Underlying sales in the US also fell from a year ago, given particular weakness in its safety & industrial & transportation businesses, which softened further as the qtr progressed. And conditions aren't expected to get any better the rest of the year. It has been a tough year for MMM investors. The stock slumped in Jul after the company disclosed an internal investigation into potential violations of the US Foreign Corrupt Practices Act (FCPA), citing concerns arising from marketing efforts by certain business groups in China. In Apr, the stock suffered the biggest one-day selloff in over 30 years after a disappointing Q1 report. The stock sank 6.86 (4%) to a 4 year low.
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
News on corp earnings was generally dreary, although on the trade front China blinked. It gave in on property rights & will resume buying agricultural products (i.e. soybeans). That is one major blink. The markets did not shoot up on the announcement because words are cheap. After more than a year of negotiations that have gone nowhere, traders are skeptical. They want to see a signed contract.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
China passed a new law that it says will protect the intellectual property rights of foreign businesses operating in the country. "Beijing will not discriminate between domestic and foreign enterprises when enforcing its IP laws,” said Ning Jizhe, the vice chairman of China's National Development & Reform Commission, at a press conference in Beijing. Theft of intellectual property from US companies is a driving concern in Pres Trump's trade war with the world's 2nd-largest economy. American negotiators are seeking to halt forced sharing of trade secrets as a condition of doing business in the country. The US has imposed tariffs on Bs of $s in Chinese imports, driving up costs for businesses, & the 2 countries recently established a framework for a "phase one" deal. Under the new regulations, which take effect on Jan 1, China will "ensure better protection for trade secrets & never allow forced technology transfer," Ning said. "Further, China will strengthen and speed up improvements made to standards for patents, trademarks, copyright infringement, counterfeiting judgments, inspection and identification." The law minimizes the direct allocation of gov resources to the market & direct gov intervention in market activities, & establishes a punitive damages system for intellectual property infringement. China will also deepen trademark registration & patent application reform, among other things. Ning called on the US to do its part. "The other side should also improve the business environment and provide convenience for Chinese-funded enterprises," he said. "China’s intellectual property theft is real, damaging, and ending thanks to President Trump’s strong trade actions and his OSTP Director’s focus on ending abuses in our open society’s education and research system," an administration official said. The tentative US-China deal, which has not yet been signed, is said to include China making concessions on intellectual property, financial services & agriculture. In return, the US agreed not to implement new tariffs on Chinese goods on Oct 15. It is not yet clear if the US will go thru with its next round of tariffs scheduled for Dec 15. The 2 sides are working to complete a written draft for Pres's Trump & Xi Jinping to sign when they are in Chile next month for the Asia-Pacific Economic Cooperation summit. Trump has said a comprehensive trade deal will have 2 or 3 phases.
China gives in on key US trade-war demand
China purchased 264K more metric tons of soybeans amid US-China trade uncertainty, the Dept of Agriculture said. The purchases were made after Sep 1, which marked the beginning of the "marketing year" for soybeans. Chinese importers purchased roughly 600K tons of US soybeans after deputy-level trade discussions between the US & China in Sep. The soybeans will not be shipped out all at once. The roughly 10 boatloads of soybeans will make their way to China in Oct-Dec. No formal trade deal has been signed by the 2 superpowers. White House trade adviser Peter Navarro said a "phase one" trade deal with China can happen during next month's Asia-Pacific Economic Cooperation (APEC) forum in Chile. "We are on the guiding path to Chile and the meeting of the two presidents in mid-November," he said last week. "The plan there, is to have an agreement."
China buys boatloads of US soybeans ahead of possible deal
Prime Minister Boris Johnson said that the only way to break Britain's Brexit impasse is a general election, & he will ask Parliament to approve a national poll for Dec 12. Johnson said he would ask lawmakers to vote Mon on a motion calling for an early election. Johnson has been mulling his next move since Tues, when lawmakers blocked his attempt to fast-track an EU divorce bill thru Parliament in a matter of days. Lawmakers said they needed more time to scrutinize the legislation, making it all but impossible for Britain to leave the EU on the scheduled date of Oct 31 with a deal. The British gov has been awaiting the EU's decision on whether to postpone the UK's departure to prevent a chaotic no-deal exit. The request for a delay until Jan 31 was ordered by Britain's Parliament to avert the economic damage that could come from a no-deal exit. Though the EU has not given its answer, Johnson said it looked like the EU would grant the extension, & with it kill off Johnson's oft-repeated promise that Britain will leave the EU at the end of this month. "I'm afraid it looks as though our EU friends are going to respond to Parliament's request by having an extension, which I really don't want at all," Johnson added. Britain's next scheduled election is in 2022. If Johnson wants an early election, he needs to win a vote in Parliament by a 2/3 majority, or lose a no-confidence vote, which so far opposition parties have refused to call. The main opposition Labour Party has said it would "support a general election when the threat of a no-deal crash-out is off the table." European Council Pres Donald Tusk has recommended that the other 27 EU nations grant Britain a delay, yet many of the bloc's members are weary & frustrated at Britain's interminable Brexit melodrama. But they also want to avoid the economic pain that would come to both sides from a sudden & disruptive British exit. So they are likely to agree, although politicians in France say Pres Emmanuel Macron is pushing for a shorter extension than the 3 months that Britain has asked for.
UK calls for new election after Brexit disaster blows up in PM's face
Johnson & Johnson (JNJ), a Dow stock & Dividend Aristocrat, lowered its previously reported Q3 profit by $3B to account for a proposed opioid settlement payment. A framework settlement, announced on Mon, was hammered out by some drugmakers & distributors & attorneys general in North Carolina, Pennsylvania, Tennessee & Texas. The proposed deal will need broad support among all the state attorneys general & local govs that have sued the companies over the opioid crisis. JNJ, which is facing thousands of lawsuits over a variety of products, lowered its reported EPS to 66¢ from $1.81 & said there was no impact to its adjusted earnings numbers. The company said it could not predict when or if the opioid deal would be finalized. The drug industry faces roughly 2600 lawsuits brought by state & local govs, hospitals & other entities seeking to hold drugmakers & distributors responsible for the toll of opioid abuse. The stock fell 2.40.
If you would like to learn more about JNJ, click on this link:
club.ino.com/trend/analysis/stock/JNJ?a_aid=CD3289&a_bid=6ae5b6f7
J&J slashes third-quarter profit by $3 billion over proposed opioid deal
Workers at one of the largest General Motors (GM) factories voted to ratify a new contract with the company, an
indication that a 5-week strike could be coming to an end. United
Auto Workers Local 598 at a pickup truck plant in Flint, Michigan,
approved the contract today. The local's Facebook page says 60.9%
voted in favor, while 39.1% were against. Workers across the nation are voting on the new 4-year deal & voting ends tomorrow. The Flint local is the 2nd-largest in the nation, so its approval is a strong sign of passage. Workers went on strike Sep 16, crippling GM's US factories & costing the company an estimated $2B. The stock was off 79¢.
If you would like to learn more about GM, click on this link:
club.ino.com/trend/analysis/stock/GM?a_aid=CD3289&a_bid=6ae5b6f7
If you would like to learn more about GM, click on this link:
club.ino.com/trend/analysis/stock/GM?a_aid=CD3289&a_bid=6ae5b6f7
Workers at large GM plant in Michigan approve contract
Shares of 3M (MMM), a Dow stock & Dividend Aristocrat. took a dive, after the diversified consumer, industrial & health care products maker beat Q3 profit expectations but missed on revenue & lowered its earnings outlook, citing “challenging” macroeconomic conditions, including slowdowns in the US & China. “We continued to face softness in certain end markets; namely China, automotive and electronics, which represent 30% of our company,” CEO Michael Roman said. The company expects Q4 net EPS of $2.05-2.15, which includes a one-time 15¢ negative impact from the recently completed acquisition of Acclity. The consensus is $2.31 for net EPS & $2.38 for adjusted EPS, which excludes non-recurring items. MMM also lowered its 2019 adjusted EPS guidance to $8.99-9.09 from $9.25-9.75, which compares with the consensus of $9.28. The company also lowered its outlook for return on invested capital (ROIC) to 18.5-19.5% from 20-22%. But China's isn’t the only economy contributing to the downbeat outlook. Underlying sales in the US also fell from a year ago, given particular weakness in its safety & industrial & transportation businesses, which softened further as the qtr progressed. And conditions aren't expected to get any better the rest of the year. It has been a tough year for MMM investors. The stock slumped in Jul after the company disclosed an internal investigation into potential violations of the US Foreign Corrupt Practices Act (FCPA), citing concerns arising from marketing efforts by certain business groups in China. In Apr, the stock suffered the biggest one-day selloff in over 30 years after a disappointing Q1 report. The stock sank 6.86 (4%) to a 4 year low.
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
News on corp earnings was generally dreary, although on the trade front China blinked. It gave in on property rights & will resume buying agricultural products (i.e. soybeans). That is one major blink. The markets did not shoot up on the announcement because words are cheap. After more than a year of negotiations that have gone nowhere, traders are skeptical. They want to see a signed contract.
Dow Jones Industrials
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