Dow dropped 79, decliners over advancers 4-3 & NAZ fell 7. The MLP index was off fractionally in the 225s & the REIT index sank 5+ to the 397s. Junk bond funds fluctuated & Treasuries crawled higher in price. Oil slid lower in the 62s & gold rose another 3 to 1571.
AMJ (Alerian MLP Index tracking fund)
Stocks slid at the open as investors continue to monitor recent developments in the Middle East. US officials remained on alert after a drone attack killed Iranian Gen Qassem Soleimani. The US Air Force flexed its muscles yesterday, conducting an "elephant walk" of 52 F-35A II Lightning fighter jets. All 3 averages traded within 0.4% of their respective flat lines & remained within striking distance of all-time highs. On the commodities front, West Texas Intermediate crude oil was down 1.2% at $62.50 a barrel. The energy component is now up just 2.1% since a US airstrike killed Iranian Gen. Qassim Soleimani Thurs. Elsewhere, gold hit its highest level since 2013 before pulling back to unchanged at $1569 an ounce. Economic data showed the US trade deficit fell 8.2% to $43.1B in Nov, hitting its lowest level since 2016 & the US deficit with China plunged by 15.7% to $26.4B. Treasuries were flat with the yield on the 10-year note holding at 1.81%. In Europe, Germany's DAX advanced 0.6% & France's CAC inched higher while Britain's FTSE was little changed.
The US trade deficit plunged to a more than 3-year low in Nov, suggesting the Trump administration's trade war with China was producing results. The deficit fell 8.2% to $43.1B, the smallest since Oct 2016, the Commerce Dept said. It was down 0.7% thru the first 11 months of the year & is on track for its first annual decline since 2013. Exports to China spiked 13.7% as imports fell by 9.2%, pushing the US trade deficit with China down by 15.7% to $26.4B. The trade deficit with the EU narrowed by 20.2% $13.1B. Pres Trump has long referred to the trade balance as a scorecard of sorts for how the trade war is progressing. The US & China reached a partial trade deal on Dec 12 after a more than 21-month-long trade battle. A Chinese delegation is expected to arrive in DC on Jan 13 with a signing scheduled to take place 2 days later at the White House. Trump has said a comprehensive deal could be done in 2 or 3 parts.
A weakening economy plus stepped up competition in the SUV market caused sales of General Motors (GM) vehicles in China to fall for a 2nd straight year. GM wasn't alone as overall auto sales declined. GM saw a 15% drop in 2019 sales from a year earlier to 3.09M vehicles, said GM. The company delivered 3.65M vehicles in 2018 & 4.04M units in 2017. Sales of GM's affordable Baojun brand dropped 27.6%, Chevrolet tumbled 20.1% & Buick fell 16.7%. One bright spot saw Cadillac's sales increased 3.9%. GM is working to improve cost efficiency, according to Matt Tsien, GM exec VP & pres of GM China, said. Tsien also said that the downturn would continue in 2020. The Chinese economy has slowed as the country & the US have been engaged in a trade war with tariffs placed on various products. A phase one trade deal between the countries is expected to finally be signed later this month. The stock fell 47¢.
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
Activity in the US services sector rose slightly in Dec as businesses felt relieved by the US & China agreeing to a partial trade deal, data showed. The Institute for Supply Management's non-manufacturing index climbed to 55 last month from 53.9 in Nov. The forecast called for the reading to come in at 54.3. "The respondents are positive about the potential resolution on tariffs," Anthony Nieves, chair of The Institute for Supply Management, said. "However, respondents continue to have difficulty with labor resources." Employment in the sector decreased slightly last month from Nov while prices were unchanged.
December’s ISM non-manufacturing index signals better-than-expected expansion
The markets are watching developments in the MidEast & buyers are cautious about committing more money. Early economic data is coming in fairly good, but short of great. Meanwhile negative investors keep bidding up the price of gold, the classic safe haven investment. It's interesting that in a tough year for car sales, GM sold more cars in China than in the US.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CL=F | Crude Oil | 62.70 | -0.57 | -0.9% |
| GC=F | Gold | 1,572.10 | +3.30 | +0.2% |
Stocks slid at the open as investors continue to monitor recent developments in the Middle East. US officials remained on alert after a drone attack killed Iranian Gen Qassem Soleimani. The US Air Force flexed its muscles yesterday, conducting an "elephant walk" of 52 F-35A II Lightning fighter jets. All 3 averages traded within 0.4% of their respective flat lines & remained within striking distance of all-time highs. On the commodities front, West Texas Intermediate crude oil was down 1.2% at $62.50 a barrel. The energy component is now up just 2.1% since a US airstrike killed Iranian Gen. Qassim Soleimani Thurs. Elsewhere, gold hit its highest level since 2013 before pulling back to unchanged at $1569 an ounce. Economic data showed the US trade deficit fell 8.2% to $43.1B in Nov, hitting its lowest level since 2016 & the US deficit with China plunged by 15.7% to $26.4B. Treasuries were flat with the yield on the 10-year note holding at 1.81%. In Europe, Germany's DAX advanced 0.6% & France's CAC inched higher while Britain's FTSE was little changed.
Stocks slip as traders eye Middle East tensions
The US trade deficit plunged to a more than 3-year low in Nov, suggesting the Trump administration's trade war with China was producing results. The deficit fell 8.2% to $43.1B, the smallest since Oct 2016, the Commerce Dept said. It was down 0.7% thru the first 11 months of the year & is on track for its first annual decline since 2013. Exports to China spiked 13.7% as imports fell by 9.2%, pushing the US trade deficit with China down by 15.7% to $26.4B. The trade deficit with the EU narrowed by 20.2% $13.1B. Pres Trump has long referred to the trade balance as a scorecard of sorts for how the trade war is progressing. The US & China reached a partial trade deal on Dec 12 after a more than 21-month-long trade battle. A Chinese delegation is expected to arrive in DC on Jan 13 with a signing scheduled to take place 2 days later at the White House. Trump has said a comprehensive deal could be done in 2 or 3 parts.
US trade deficit plunges to more than 3-year low
A weakening economy plus stepped up competition in the SUV market caused sales of General Motors (GM) vehicles in China to fall for a 2nd straight year. GM wasn't alone as overall auto sales declined. GM saw a 15% drop in 2019 sales from a year earlier to 3.09M vehicles, said GM. The company delivered 3.65M vehicles in 2018 & 4.04M units in 2017. Sales of GM's affordable Baojun brand dropped 27.6%, Chevrolet tumbled 20.1% & Buick fell 16.7%. One bright spot saw Cadillac's sales increased 3.9%. GM is working to improve cost efficiency, according to Matt Tsien, GM exec VP & pres of GM China, said. Tsien also said that the downturn would continue in 2020. The Chinese economy has slowed as the country & the US have been engaged in a trade war with tariffs placed on various products. A phase one trade deal between the countries is expected to finally be signed later this month. The stock fell 47¢.
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
GM's sales in China hurt by weakening economy
Activity in the US services sector rose slightly in Dec as businesses felt relieved by the US & China agreeing to a partial trade deal, data showed. The Institute for Supply Management's non-manufacturing index climbed to 55 last month from 53.9 in Nov. The forecast called for the reading to come in at 54.3. "The respondents are positive about the potential resolution on tariffs," Anthony Nieves, chair of The Institute for Supply Management, said. "However, respondents continue to have difficulty with labor resources." Employment in the sector decreased slightly last month from Nov while prices were unchanged.
December’s ISM non-manufacturing index signals better-than-expected expansion
The markets are watching developments in the MidEast & buyers are cautious about committing more money. Early economic data is coming in fairly good, but short of great. Meanwhile negative investors keep bidding up the price of gold, the classic safe haven investment. It's interesting that in a tough year for car sales, GM sold more cars in China than in the US.
Dow Jones Industrials
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