Markets edge higher while crude oil rebounds and Treasury yields rise

Dow jumped 194, decliners over advancers about 5-4 & NAZ dropped 79.  The MLP index went up 2+ to the 183s & the REIT index rose 3+ to the 481s.  Junk bond funds remained weak & Treasuries dropped, raising yields once again.  Oil recovered 1+ to the 78s & gold dropped 17 to 1788 (more on both below).

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Dollar Tree (DLTR) will start selling most products for $1.25 at all its stores, in an effort to offset the impact of spiraling freight costs & other pandemic-driven challenges.  The retailer said the new price point, which will be fully rolled out by Q1-2022, would allow it to return to “its historical gross margin range” of 35% to 36% next year.  CEO Michael Witynski said the higher price point allows the discounter to expand assortments, introduce new products & sizes as well as bring back “traffic-driving” products.  DLTR, known for selling everything from make-up to homeware at the $1 price-point, in Sep said it planned on adding new price points above $1 across some of its stores.  Rising freight costs from global supply chain disruptions have dented profits for most of corp America, further pressuring many retailers already grappling with higher labor & raw material costs.  DLTR said that freight costs were significantly higher than anticipated in the Q3 & expects this to continue in the near term.  It projected Q4 EPS of $1.69-1.79 . The forecast is anticipating $1.75.  EPS fell to 96¢, in the qtr ended Oct 30, from $1.39 a year earlier.  Net sales rose 3.9% to $6.42B, edging past expectations of $6.41B.  The stock rose 12.15 (9%).
If you would like to learn more about DLTR, click on this link:
club.ino.com/trend/analysis/stock/DLTR?a_aid=CD3289&a_bid=6ae5b6f7

Not $1 anymore: Most Dollar Tree products are going to get pricier

The Biden administration has no plans to curb future Covid-19 surges using a nationwide lockdown, White House coronavirus response coordinator Jeff Zients said.  His comments come as Austria enters its 4th nationwide lockdown & the Netherlands institute a partial lockdown amid a Covid surge rampaging across Europe in recent weeks.  Instead of locking down the US, Zients said the federal gov would rely on vaccines & therapeutic treatments to keep the country running in the event of another devastating Covid wave.  “We can curb the spread of the virus without having to in any way shut down our economy,” Zients added.  “We have 82% of people now with one shot and more and more people getting vaccinated each week.”  Zients called for the continued use of vaccines, booster shots & monoclonal antibodies to prevent the US from “going backwards in any way, shape or form.”  More than 60M eligible Americans still haven't gotten vaccinated against Covid & health officials are asking those who qualify for boosters to register for their extra doses with the holidays approaching.  Covid cases in the US plateaued at 70-75K per day for almost 3 weeks starting in late Oct, but they've since reached a 7-day average of 92K per day as of Sun, an increase of 16% from the week prior, according to Johns Hopkins University.  But overseas, Europe tallied more than 2.1M new cases during the week ended Nov 14, approximately 64% of all cases globally over that span, the World Health Organization reported.

White House says no Covid lockdowns as European nations implement restrictions

Best Buy (BBY) fiscal Q3 earnings beat estimates, yet shares tumbled as investors worried about rising shipping costs & weaker demand for consumer electronics.  The consumer electronics retailer has seen sales jump during the pandemic, as Americans upgraded the technology in their home offices, bought new appliances for their kitchens & invested in home theaters.  During Q3, BBY said it saw those trends continue as home theaters &d appliances lifted sales, along with smartphones.  EPS rose to $2.00 from $1.48 a year earlier.  Excluding items, EPS was $2.08, higher than the $1.91 expected.  Net sales rose to $11.91B from $11.85B a year earlier, outpacing estimates of $11.58B.  Same-store sales in the qtr rose 2% in the US, on top of 22.6% growth in the year-ago period.  That exceeded the company's own forecast of same-store sales being flat to down 3%.  However, analysts are concerned that BBY could see sales weaken as consumers shift spending to other areas like travel & entertainment.  That may force the retailer to offer more promotions on laptops, smartphones & more — even as supply chain related costs remain high.  The company raised its forecast slightly for the year to reflect Q3 gains, saying it now expects revenue of $51.8-52.3B compared with the prior outlook of $51-52B.   It expects same-store sales growth of 10.5-11.5% for the year.  For Q4, it says it anticipates revenue of $16.4-16.9B & same-store sales of 1% growth to 2% decline.  CEO Corie Barry said the company is positioned well for the future.  She said that BBY reached its fastest shipping times ever for small packages & that same-day delivery rose 400% in Q3 compared with last year.  Plus, she noted, digital sales were more than double pre-pandemic levels, even as customers returned to stores.  The stock sank 16.62 (12%).
If you would like to learn more about BBY, click on this link:
club.ino.com/trend/analysis/stock/BBY?a_aid=CD3289&a_bid=6ae5b6f7

Best Buy earnings top estimates but retailer’s stock tumbles amid higher shipping costs

Gold futures settled lower for a 4th straight session, with the precious metal falling to the lowest value in about 3 weeks, breaching the psychologically significant value at $1800 again.  Dec gold shed $22 (1.2%) to settle at $1783 an ounce, marking the lowest finish for a most-active contract since Nov 3, a day after the yellow metal sank 2.4% & logged the sharpest percentage drop since Aug 6.  The 4-day slide also matched the longest string of declines since the period ended Apr 30.  The slump comes as Treasury yields extend their rise in a holiday-shortened Thanksgiving week.  US markets will be closed on Thurs in observance of Thanksgiving.  Yesterday, gold's steep decline came amid the White House's announcement that Pres Biden has nominated Jerome Powell to a 2nd 4-year term as Federal Reserve chair & named Fed Gov Lael Brainard to serve as the central bank's vice chair.  Markets are betting that Powell may have to move quickly to address out-of-control inflation by accelerating a reduction in the Fed's monthly asset purchases & possibly picking up the pace of interest-rate increases.

Gold falls to 3-week low and marks longest stretch of declines since April

A case of “sell the rumor, buy the fact” appeared to be in play today as oil futures bounced higher after the White House announced the US & other countries would release crude from strategic reserves in an effort to push down energy prices.  The US will release 50M barrels of crude from its Strategic Petroleum Reserve (SPR) while China, India, South Korea & the UK will tap their supplies.  Talk of a coordinated release has hung over the oil market in recent weeks, with traders pricing in the potential for a large release.  Oil initially extended a decline after the White House announcement, but then turned higher.  West Texas Intermediate crude for Jan delivery was up $1.26 (1.6%) at $78.01 a barre.  Jan Brent crude, the global benchmark, was up $1.62 (2%) at $81.32 a barrel.  Both benchmarks have seen 4 straight weekly losses, ending Fri at 7-week lows.  The move also risks a potential response from the Organization of the Petroleum Exporting Countries & their allies (OPEC+).  The group had rebuffed calls by Pres Biden to accelerate output increases, & a report yesterday said members were prepared to rethink existing plans to gradually increase output in the event of a coordinated release of supplies from strategic reserves.  OPEC+ has been bumping up production quotas in monthly increments of 400K barrels a day.

Oil prices end higher after U.S. Strategic Petroleum Reserve release

Investors have a lot to think about.  Powell's extension at the Fed is important & gold has seen a lot of selling in the last 2 days.  Oil bulls are evaluating how releasing oil will affect the markets.  Then there is rising Treasury yields which affects all businesses.  After selling in the AM today, some stock buyers returned in the PM.  But the advance//decline ratio remained negative at the close.

Dow Jones Industrials