Dow gained 267, advancers over decliners better than 2-1 & NAZ added 56. The MLP index went up 3+ to the 147s & the REIT index rose 1+ to the 349s. Junk bond funds continued strong & Treasuries drifted lower in price. Oil advanced 1+ to the 133s (a 3 month high) & gold dropped 15 to 1735 (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)
Wells Fargo (WFC) is tapping the brakes on its auto loan business. The bank, one of the biggest lenders for new& used car purchases in the US, sent letters to hundreds of independent auto dealerships last month telling them that the company was dropping them as a customer, according to a leaker. WFC confirmed that the bank, which only makes auto loans through car dealerships, will no longer accept loan applications from most independent shops. Independent dealerships typically sell used cars, unlike franchise dealerships that focus on new vehicles from specific manufacturers. The bank had “an obligation to review our business practices in light of the economic uncertainty presented by COVID-19 & have let the majority of our independent dealer customers know that we will suspend accepting applications from them,” a spokesperson said. “The independent dealers we will continue doing business with are those with deep, long-standing relationships with Wells Fargo.” The move follows the company's retrenchment from parts of the mortgage market as the coronavirus pandemic. The bank is operating under a dozen consent orders tied to its 2016 fake accounts scanda & one of those orders, from the Federal Reserve, limits the bank's ability to grow its balance sheet until it fixes compliance shortcomings. That limitation stung WFC after the pandemic drove commercial clients to take Bs of $s in credit lines and loans, moves that strained the firm's regulatory asset cap. CEO Charlie Scharf, who joined in Oct to clean up the mess, noted last week that the constraint “hasn’t been easy” on the bank. “We’ve had to take substantial actions to get down below the cap,” Scharf added. “We’ve obviously not been able to grow. We’ve been there to serve customers who are longstanding customers who have committed facilities with us. But there are a bunch of things that we haven’t been able to do because the asset cap.” The stock went up 31¢.
If you would like to learn more about WFC, click on this link:
club.ino.com/trend/analysis/stock/WFC?a_aid=CD3289&a_bid=6ae5b6f7
Embattled Wells Fargo cuts back from making loans to independent car dealerships
Dick’s Sporting Goods (DKS) swung to a loss as stay-at-home orders to slow the spread of COVID-19 shuttered stores for the final weeks of Mar. The retailer lost $1.71 per share, in Q1 as revenue plunged 31% from a year ago to $1.3B. The forecast expected a loss of 57¢ a share on revenue of $1.4B. “Although the business environment of 2020 remains uncertain, Dick's Sporting Goods is in a position of strength,” CEO Edward Stack said. “We believe coming out of the current crisis, health and fitness will become even more important to the consumer.” Q1 same-store sales plunged 30% from a year ago, but the closings helped fuel a surge in online demand: E-commerce revenue rose 210% year-over-year in the weeks after the shutdowns. The company said same-store sales were down 4% thru the first 4 weeks of Q2 & that digital sales were up more than 250%. DKS ended the qtr with $1.5B cash & $1.4B in outstanding borrowings thru its revolving credit facility. 80% of its stores were reopened as of May 30. The company did not provide an updated outlook after withdrawing its full-year 2020 guidance on Mar 19 due to the uncertainty caused by the virus. The stock rose 1.32.
If you would like to learn more about DKS, click on this link:
club.ino.com/trend/analysis/stock/DKS?a_aid=CD3289&a_bid=6ae5b6f7
Gold futures relinquished modest early gains to end lower for a 2nd straight session, as buoyancy in global stock markets pressured prices for the metal. Gold for Aug lost $16 (0.9%) to settle at $1734 an ounce after declining a tad yesterday. $-pegged commodities have been buttressed from a weaker greenback, which precious metals are priced in. A weaker buck can make assets priced in the currency more appealing to buyers using other monetary units. Bullion prices were facing some headwinds from a continued revival in investor appetite for stocks as they climb back from a Mar rout induced by fears about the dire economic implications of the spread of the novel strain of coronavirus & the effects of measures to curtail the infection. Economic stimulus measures enacted by the Federal Reserve, including near-zero interest rates, & fiscal stimulus around the globe have, overall, supported bullion buying.
Oil futures climbed to log their highest settlement in about 3 months, supported by reports that major crude producers may agree to extend output cuts scheduled to taper at the end of Jun. OPEC &, notably, major producer Russia, part of a group known as OPEC+, are now expected to extend their output cuts of 9.7M barrels per day (provided Russia agrees). OPEC+ was nearing an agreement to extend collective production cuts thru Sep 1 & planned to discuss output curbs during a meeting via conference call on Thurs. The call would bring forward a meeting that has been scheduled for Jun 9-10. West Texas Intermediate crude for Jul gained $1.37 (3.9%) to settle at $36.81 a barrel. Global benchmark Brent saw its Aug contract climb $1.25 (3.3%) at $39.57 a barrel on the ICE Futures Europe platform, after touching an intraday high of $39.57. WTI & Brent crude both marked the highest settlements for front-month contracts since Mar 6. Already, there is evidence that OPEC+ production cuts that began in May have been effective, with Russian output falling to 9.39M barrels a day last month, near the OPEC+ goal. Russia's output was down from 11.35M barrels per day in Apr, the news organization reported, citing sources familiar with the matter. The crude market also has been bolstered by hope that business reopenings across the world from the COVID-19 pandemic could help to drive demand for oil & other crude byproducts. Investors, however, have focused on strained relations between the US & China. A report said that Beijing has halted some imports of US soybeans, potentially adding to Sino-American friction, which could add pressure on crude prices if it results in an erosion of the hard-won, phase-one trade agreement. However a report today said that some soybean sales were still going thru.
The attention of investors continues to be on a recovery by the US economy, despite the civil unrest plaguing America. They are believers. At the same time negative investors are buying gold (& Treasuries), classic safe haven investments. Gold has been near & mostly above 1700 (not far from its records reached in 2011) during the worst of the coronavirus crisis time. The long term is important & the US has a excellent record for about 250 years. With our prayers, that will continue for many years going forward.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
Wells Fargo (WFC) is tapping the brakes on its auto loan business. The bank, one of the biggest lenders for new& used car purchases in the US, sent letters to hundreds of independent auto dealerships last month telling them that the company was dropping them as a customer, according to a leaker. WFC confirmed that the bank, which only makes auto loans through car dealerships, will no longer accept loan applications from most independent shops. Independent dealerships typically sell used cars, unlike franchise dealerships that focus on new vehicles from specific manufacturers. The bank had “an obligation to review our business practices in light of the economic uncertainty presented by COVID-19 & have let the majority of our independent dealer customers know that we will suspend accepting applications from them,” a spokesperson said. “The independent dealers we will continue doing business with are those with deep, long-standing relationships with Wells Fargo.” The move follows the company's retrenchment from parts of the mortgage market as the coronavirus pandemic. The bank is operating under a dozen consent orders tied to its 2016 fake accounts scanda & one of those orders, from the Federal Reserve, limits the bank's ability to grow its balance sheet until it fixes compliance shortcomings. That limitation stung WFC after the pandemic drove commercial clients to take Bs of $s in credit lines and loans, moves that strained the firm's regulatory asset cap. CEO Charlie Scharf, who joined in Oct to clean up the mess, noted last week that the constraint “hasn’t been easy” on the bank. “We’ve had to take substantial actions to get down below the cap,” Scharf added. “We’ve obviously not been able to grow. We’ve been there to serve customers who are longstanding customers who have committed facilities with us. But there are a bunch of things that we haven’t been able to do because the asset cap.” The stock went up 31¢.
If you would like to learn more about WFC, click on this link:
club.ino.com/trend/analysis/stock/WFC?a_aid=CD3289&a_bid=6ae5b6f7
Embattled Wells Fargo cuts back from making loans to independent car dealerships
Dick’s Sporting Goods (DKS) swung to a loss as stay-at-home orders to slow the spread of COVID-19 shuttered stores for the final weeks of Mar. The retailer lost $1.71 per share, in Q1 as revenue plunged 31% from a year ago to $1.3B. The forecast expected a loss of 57¢ a share on revenue of $1.4B. “Although the business environment of 2020 remains uncertain, Dick's Sporting Goods is in a position of strength,” CEO Edward Stack said. “We believe coming out of the current crisis, health and fitness will become even more important to the consumer.” Q1 same-store sales plunged 30% from a year ago, but the closings helped fuel a surge in online demand: E-commerce revenue rose 210% year-over-year in the weeks after the shutdowns. The company said same-store sales were down 4% thru the first 4 weeks of Q2 & that digital sales were up more than 250%. DKS ended the qtr with $1.5B cash & $1.4B in outstanding borrowings thru its revolving credit facility. 80% of its stores were reopened as of May 30. The company did not provide an updated outlook after withdrawing its full-year 2020 guidance on Mar 19 due to the uncertainty caused by the virus. The stock rose 1.32.
If you would like to learn more about DKS, click on this link:
club.ino.com/trend/analysis/stock/DKS?a_aid=CD3289&a_bid=6ae5b6f7
Dick's Sporting Goods loses $143M as coronavirus closings overshadow digital surge
Gold futures relinquished modest early gains to end lower for a 2nd straight session, as buoyancy in global stock markets pressured prices for the metal. Gold for Aug lost $16 (0.9%) to settle at $1734 an ounce after declining a tad yesterday. $-pegged commodities have been buttressed from a weaker greenback, which precious metals are priced in. A weaker buck can make assets priced in the currency more appealing to buyers using other monetary units. Bullion prices were facing some headwinds from a continued revival in investor appetite for stocks as they climb back from a Mar rout induced by fears about the dire economic implications of the spread of the novel strain of coronavirus & the effects of measures to curtail the infection. Economic stimulus measures enacted by the Federal Reserve, including near-zero interest rates, & fiscal stimulus around the globe have, overall, supported bullion buying.
Gold prices finish lower for a second session loss
Oil futures climbed to log their highest settlement in about 3 months, supported by reports that major crude producers may agree to extend output cuts scheduled to taper at the end of Jun. OPEC &, notably, major producer Russia, part of a group known as OPEC+, are now expected to extend their output cuts of 9.7M barrels per day (provided Russia agrees). OPEC+ was nearing an agreement to extend collective production cuts thru Sep 1 & planned to discuss output curbs during a meeting via conference call on Thurs. The call would bring forward a meeting that has been scheduled for Jun 9-10. West Texas Intermediate crude for Jul gained $1.37 (3.9%) to settle at $36.81 a barrel. Global benchmark Brent saw its Aug contract climb $1.25 (3.3%) at $39.57 a barrel on the ICE Futures Europe platform, after touching an intraday high of $39.57. WTI & Brent crude both marked the highest settlements for front-month contracts since Mar 6. Already, there is evidence that OPEC+ production cuts that began in May have been effective, with Russian output falling to 9.39M barrels a day last month, near the OPEC+ goal. Russia's output was down from 11.35M barrels per day in Apr, the news organization reported, citing sources familiar with the matter. The crude market also has been bolstered by hope that business reopenings across the world from the COVID-19 pandemic could help to drive demand for oil & other crude byproducts. Investors, however, have focused on strained relations between the US & China. A report said that Beijing has halted some imports of US soybeans, potentially adding to Sino-American friction, which could add pressure on crude prices if it results in an erosion of the hard-won, phase-one trade agreement. However a report today said that some soybean sales were still going thru.
Oil futures log 3-month high on bets for an extension of global production cuts
The attention of investors continues to be on a recovery by the US economy, despite the civil unrest plaguing America. They are believers. At the same time negative investors are buying gold (& Treasuries), classic safe haven investments. Gold has been near & mostly above 1700 (not far from its records reached in 2011) during the worst of the coronavirus crisis time. The long term is important & the US has a excellent record for about 250 years. With our prayers, that will continue for many years going forward.
Dow Jones Industrials
No comments:
Post a Comment