Dow pulled back 101, advancers over decliners about 5-4 & NAZ lost 90. The MLP index was steady in the 141s & the REIT index was even in the 318s. Junk bond funds fluctuated & Treasuries were slightly higher. Oil went up to 34 & gold dropped 27 to 1724 (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)
The US & China are making progress toward implementing the phase one trade deal struck earlier this year, with Beijing now accepting shipments from more US plants than ever before. The announcement from US Trade Representative Robert Lighthizer comes amid flaring tensions after the US criticized Beijing's initial handling of the COVID-19 pandemic, which was first identified in Wuhan, China, & has since infected nearly 4.9M worldwide. Even with the recent tensions between the 2 sides, however, Beijing has forged ahead with updating its list of US facilities eligible to ship their goods to China. The list now includes 499 beef, 457 pork, 470 poultry, 397 seafood, 253 dairy & 9 infant-formula facilities, according to the Office of the US Trade Representative. Agriculture products from blueberries to avocados & barley are now eligible for export to China, the Dept of Agriculture & the Trade Representative's Office said. “China has worked with the United States to implement measures that will provide greater access for U.S. producers and exporters to China’s growing food and agricultural markets,” Lighthizer said. The US & China signed a historic trade accord in Jan that called for Beijing to purchase an additional $200B worth of American products over the next 2 years, in addition to commitments to halt intellectual property theft, refrain from currency manipulation & cooperate in financial services. The purchases will include up to $50B of US agriculture & an additional $40B in services, $50B in energy & up to $80B worth of manufacturing. In return, the US reduced tariffs imposed by Pres Trump on some goods, but kept duties on $375B worth of merchandise. Phase 2 talks were supposed to begin earlier this year, but the pandemic has delayed those discussions.
Starbucks (SBUX) customers are starting to return to its cafes in the US & China as the global coffee chain reopens many locations that shuttered temporarily due to the coronavirus pandemic. CEO Kevin Johnson wrote to employees that the company has regained about 60-65% of its US. same-store sales over the last week, compared to the same period a year ago. SBUX has reopened more than 85% of its US locations with modified operations. Johnson said that the company is tracking slightly above its internal estimates for recovery. In China, where cafes have been reopened longer, same-store sales are down only about 20%, “reflecting gradual improvements over the past several weeks,” according to Johnson. “Our recovery progresses each week, and we know that it will take time to fully recover and post positive comparable store sales growth,” Johnson added. In Q1, global same-store sales fell 10% as the pandemic hit locations in China & the US, its 2 largest markets. The company estimated that it lost $915M in sales during the qtr due to store closures, reduced operating hours & lower customer traffic. Catastrophe pay for baristas, hourly pay increases & the cost of store safety items such as face coverings weighed on profits. Its fiscal Q2 earnings were nearly cut in ½ as a result. SBUX launched its summer menu on today in the hopes of attracting even more customers to US locations. New items include the unicorn cake pop, an iced guava passionfruit drink, & a grilled chicken & hummus protein box. Johnson also noted that until traffic returns to pre-crisis levels, many baristas will be working shorter hours than they were before the pandemic. The company is extended its pandemic unpaid leave policy thru the end of Sep for employees who still want company benefits. The stock added 29¢.
If you would like to learn more about SBUX,click on this link:
club.ino.com/trend/analysis/stock/SBUX?a_aid=CD3289&a_bid=6ae5b6f7
Starbucks same-store sales in U.S. and China improve as company reopens cafes
Mitch McConnell says next coronavirus bill will not extend enhanced unemployment benefits
Gold prices posted their first loss in 3 sessions, with the yellow metal marking its lowest finish in more than a week as investors weighed some signs of improvement in the latest economic data. Preliminary composite readings on business activity in the eurozone showed that France's purchasing managers index rose to 30.5 in May from 11.1 in Apr, while the flash Germany PMI composite index rose to 31.4 from 17.4 & the flash UK composite index rose to 28.9 from 13.8 in Apr. Any reading below 50 indicates deteriorating conditions. Gold traders also digested US economic data. On an actual, or unadjusted basis, a total of more than 4.4M unemployed Americans applied for jobless benefits thru the states or a temporary federal-relief program last week. On an adjusted basis first time unemployment insurance filings totaled 2.44M. US private sector firms reported a slightly slower rate of contraction in activity in May, with IHS Markit reported that its flash manufacturing purchasing index rose to 39.8 in May from 36.1 in Apr. Gold for Jun declined $30 (1.7%) to settle at $1721 an once, the lowest most-active contract finish since May 13.
Oil futures ended higher, adding to recent gains that have pushed both the intl & the US benchmark contracts to around 2½ month highs, as a slowdown in supplies & hope for higher demand help prices recover some of their recent losses. Prices, however, finished off the day's highs, pressured by profit-taking on the heels of oil's sharp climb, as well as uncertainty over the rate of demand recovery as well as US-China trade tensions. Jul West Texas Intermediate (WTI) oil rose 43¢ (1.3%) to settle at $33.92 a barrel, down from a session high of $34.66. The settlement was the highest since Mar 10, based on the front-month contracts. Meanwhile, global benchmark Brent crude for Jul added 31¢ (0.9%) to settle at $36.06 a barrel, also the highest since Mar 10. So far this month, WTI prices, based on the front-month contracts, have climbed 80%, while Brent oil has rallied by nearly 43%. OPEC their allies have cut oil exports by 6M barrels a day in May to date, according to companies that track crude flows. An agreement between the group of producers, known as OPEC+, calls for cuts of 9.7M barrels to the end of Jun, with Saudi Arabia among those who have pledged extra reductions. Data from the Energy Information Administration yesterday was also supportive for prices, showing crude stocks at the storage hub in Cushing, Oklahoma, fell by about 5.5M barrels for the week. The data also represented a 2nd weekly decline in overall US crude stockpiles, helping to ease concerns over tightening storage space that had contributed to a precipitous downturn in the price of the commodity. Adding further hope to a recovery from the deadly pandemic, data in Europe showed improvement. In the US, the number of jobless claims, on an adjusted basis, stood at 2.44M last week, but has fallen for 7 straight weeks.
Oil ends at six-week high on tighter supplies, demand prospects
Federal Reserve Chair Jerome Powell said the US economy is facing an unprecedented level of uncertainty as a result of the coronavirus outbreak, which has triggered the worst economic catastrophe since the depression. “We are now experiencing a whole new level of uncertainty, as questions only the virus can answer complicate the outlook," Powell said during prepared remarks for a virtual Fed Listens event. The central bank chief said the economic downturn has been "sudden and severe" -- but noted the fallout is disproportionately affecting low-income Americans. "And while the burden is widespread, it is not evenly spread. Those taking the brunt of the fallout are those least able to bear it," he added. A previous Fed survey found the coronavirus job losses appeared to be concentrated among low-income workers: About 39% of individuals working in Feb with a household income below $40K reported losing their job in Mar. In the 9 weeks since the economy came to a grinding halt, nearly 39M Americans have lost their jobs, a development that Powell described as "tragic and heartbreaking." In Feb, before the virus gained foothold in the US, unemployment was at a ½-century low of 3.5½. In the past 8 weeks, the Fed has pumped nearly $2.9T into the economy, & its balance sheet has expanded to a record $7T.
The stock market accepted the jobless claims report which was widely expected. The grim data in May indicates that the jobs report in early Jun will continue to be dismal. Early data on business activity in Europe showed improvement although depression conditions remain. The bulls are still challenged to take the Dow above mid Mar levels.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
The US & China are making progress toward implementing the phase one trade deal struck earlier this year, with Beijing now accepting shipments from more US plants than ever before. The announcement from US Trade Representative Robert Lighthizer comes amid flaring tensions after the US criticized Beijing's initial handling of the COVID-19 pandemic, which was first identified in Wuhan, China, & has since infected nearly 4.9M worldwide. Even with the recent tensions between the 2 sides, however, Beijing has forged ahead with updating its list of US facilities eligible to ship their goods to China. The list now includes 499 beef, 457 pork, 470 poultry, 397 seafood, 253 dairy & 9 infant-formula facilities, according to the Office of the US Trade Representative. Agriculture products from blueberries to avocados & barley are now eligible for export to China, the Dept of Agriculture & the Trade Representative's Office said. “China has worked with the United States to implement measures that will provide greater access for U.S. producers and exporters to China’s growing food and agricultural markets,” Lighthizer said. The US & China signed a historic trade accord in Jan that called for Beijing to purchase an additional $200B worth of American products over the next 2 years, in addition to commitments to halt intellectual property theft, refrain from currency manipulation & cooperate in financial services. The purchases will include up to $50B of US agriculture & an additional $40B in services, $50B in energy & up to $80B worth of manufacturing. In return, the US reduced tariffs imposed by Pres Trump on some goods, but kept duties on $375B worth of merchandise. Phase 2 talks were supposed to begin earlier this year, but the pandemic has delayed those discussions.
US, China move forward with trade deal
Starbucks (SBUX) customers are starting to return to its cafes in the US & China as the global coffee chain reopens many locations that shuttered temporarily due to the coronavirus pandemic. CEO Kevin Johnson wrote to employees that the company has regained about 60-65% of its US. same-store sales over the last week, compared to the same period a year ago. SBUX has reopened more than 85% of its US locations with modified operations. Johnson said that the company is tracking slightly above its internal estimates for recovery. In China, where cafes have been reopened longer, same-store sales are down only about 20%, “reflecting gradual improvements over the past several weeks,” according to Johnson. “Our recovery progresses each week, and we know that it will take time to fully recover and post positive comparable store sales growth,” Johnson added. In Q1, global same-store sales fell 10% as the pandemic hit locations in China & the US, its 2 largest markets. The company estimated that it lost $915M in sales during the qtr due to store closures, reduced operating hours & lower customer traffic. Catastrophe pay for baristas, hourly pay increases & the cost of store safety items such as face coverings weighed on profits. Its fiscal Q2 earnings were nearly cut in ½ as a result. SBUX launched its summer menu on today in the hopes of attracting even more customers to US locations. New items include the unicorn cake pop, an iced guava passionfruit drink, & a grilled chicken & hummus protein box. Johnson also noted that until traffic returns to pre-crisis levels, many baristas will be working shorter hours than they were before the pandemic. The company is extended its pandemic unpaid leave policy thru the end of Sep for employees who still want company benefits. The stock added 29¢.
If you would like to learn more about SBUX,click on this link:
club.ino.com/trend/analysis/stock/SBUX?a_aid=CD3289&a_bid=6ae5b6f7
Starbucks same-store sales in U.S. and China improve as company reopens cafes
Senate Majority Leader Mitch McConnell said the next the coronavirus bill would not extend beefed-up unemployment insurance enacted as the
pandemic ravaged the US economy, according to a source familiar with
his remarks. He made the comment on a call with House GOP lawmakers as he talked about priorities for the
next phase of the outbreak response.
The $600 per week federal unemployment benefit, which adds to the sum
individuals normally get from states, will expire at the end of Jul. House Dems passed a $3T rescue package last week that would extend the financial backstop thru Jan. Their efforts to sustain the more generous assistance come as new gov data shows more than 38M have filed jobless claims since widespread closures designed to slow infections began in Mar. McConnell has questioned the need for more immediate federal
spending. He has said he wants to first see how effective the more than
$2.5T already passed is in combating the crisis. Some Senate
Reps have argued the enhanced unemployment insurance could deter
work because, in certain cases, individuals receive more money than they
otherwise would have made at their jobs. But failing to extend
the benefit could leave Ms of Americans facing a sudden income
cliff in Aug in an economy where employers may still be unable or
reluctant to hire.
Mitch McConnell says next coronavirus bill will not extend enhanced unemployment benefits
Gold prices posted their first loss in 3 sessions, with the yellow metal marking its lowest finish in more than a week as investors weighed some signs of improvement in the latest economic data. Preliminary composite readings on business activity in the eurozone showed that France's purchasing managers index rose to 30.5 in May from 11.1 in Apr, while the flash Germany PMI composite index rose to 31.4 from 17.4 & the flash UK composite index rose to 28.9 from 13.8 in Apr. Any reading below 50 indicates deteriorating conditions. Gold traders also digested US economic data. On an actual, or unadjusted basis, a total of more than 4.4M unemployed Americans applied for jobless benefits thru the states or a temporary federal-relief program last week. On an adjusted basis first time unemployment insurance filings totaled 2.44M. US private sector firms reported a slightly slower rate of contraction in activity in May, with IHS Markit reported that its flash manufacturing purchasing index rose to 39.8 in May from 36.1 in Apr. Gold for Jun declined $30 (1.7%) to settle at $1721 an once, the lowest most-active contract finish since May 13.
Gold posts first loss in 3 sessions, logs lowest finish in over a week
Oil futures ended higher, adding to recent gains that have pushed both the intl & the US benchmark contracts to around 2½ month highs, as a slowdown in supplies & hope for higher demand help prices recover some of their recent losses. Prices, however, finished off the day's highs, pressured by profit-taking on the heels of oil's sharp climb, as well as uncertainty over the rate of demand recovery as well as US-China trade tensions. Jul West Texas Intermediate (WTI) oil rose 43¢ (1.3%) to settle at $33.92 a barrel, down from a session high of $34.66. The settlement was the highest since Mar 10, based on the front-month contracts. Meanwhile, global benchmark Brent crude for Jul added 31¢ (0.9%) to settle at $36.06 a barrel, also the highest since Mar 10. So far this month, WTI prices, based on the front-month contracts, have climbed 80%, while Brent oil has rallied by nearly 43%. OPEC their allies have cut oil exports by 6M barrels a day in May to date, according to companies that track crude flows. An agreement between the group of producers, known as OPEC+, calls for cuts of 9.7M barrels to the end of Jun, with Saudi Arabia among those who have pledged extra reductions. Data from the Energy Information Administration yesterday was also supportive for prices, showing crude stocks at the storage hub in Cushing, Oklahoma, fell by about 5.5M barrels for the week. The data also represented a 2nd weekly decline in overall US crude stockpiles, helping to ease concerns over tightening storage space that had contributed to a precipitous downturn in the price of the commodity. Adding further hope to a recovery from the deadly pandemic, data in Europe showed improvement. In the US, the number of jobless claims, on an adjusted basis, stood at 2.44M last week, but has fallen for 7 straight weeks.
Oil ends at six-week high on tighter supplies, demand prospects
Federal Reserve Chair Jerome Powell said the US economy is facing an unprecedented level of uncertainty as a result of the coronavirus outbreak, which has triggered the worst economic catastrophe since the depression. “We are now experiencing a whole new level of uncertainty, as questions only the virus can answer complicate the outlook," Powell said during prepared remarks for a virtual Fed Listens event. The central bank chief said the economic downturn has been "sudden and severe" -- but noted the fallout is disproportionately affecting low-income Americans. "And while the burden is widespread, it is not evenly spread. Those taking the brunt of the fallout are those least able to bear it," he added. A previous Fed survey found the coronavirus job losses appeared to be concentrated among low-income workers: About 39% of individuals working in Feb with a household income below $40K reported losing their job in Mar. In the 9 weeks since the economy came to a grinding halt, nearly 39M Americans have lost their jobs, a development that Powell described as "tragic and heartbreaking." In Feb, before the virus gained foothold in the US, unemployment was at a ½-century low of 3.5½. In the past 8 weeks, the Fed has pumped nearly $2.9T into the economy, & its balance sheet has expanded to a record $7T.
Fed's Powell says US economy facing 'whole new level' of uncertainty amid coronavirus pandemic
The stock market accepted the jobless claims report which was widely expected. The grim data in May indicates that the jobs report in early Jun will continue to be dismal. Early data on business activity in Europe showed improvement although depression conditions remain. The bulls are still challenged to take the Dow above mid Mar levels.
Dow Jones Industrials
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