Dow slid back 38, advancers over decliners about 2-1 & NAZ went up 152. The MLP index fell 3+ to the 187s & the REIT index added 2+ to the 389. Junk bond funds were mixed & Treasuries saw more buying, reducing Treasury yields. Oil sank 8+ to the 109s & gold lost 8 to 1841 (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)
A majority of global CEOs think a recession is looming or already
here, according to a new survey, reflecting an increasingly bleak economic outlook among business leaders as inflation rages. More
than 60% of execs expect a recession in the next 12-18 months,
according to a survey of CEOs & other C-suite execs conducted by
the Conference Board, a business research firm. That's a stunning
increase from the end of 2021, when just 22% of execs forecast a
recession. On top of that, 15% of CEOs believe their geographic region is already in a recession. "CEOs
and other C-suite executives see the war fueling inflation through
energy price volatility and higher costs for scarce inputs. This is
leading to concerns over margin compression," the survey said. The survey is based on data collected in May & was conducted before
the Federal Reserve approved a 75-basis point interest
rate hike, the largest since 1994. Another interest rate increase of
that magnitude is expected in Jul, which would put the federal funds
target range at 2.25-2.50%, the steepest since the COVID-19 pandemic began two years ago. Hiking
interest rates tends to create higher rates on consumer &d business
loans, which slows the economy by forcing employers to cut back on
spending. Although Fed Chair Jerome Powell
has said the central bank is not trying to induce a recession, he has
not ruled out the possibility of a downturn & has admitted the odds of
a successful "soft landing" are getting narrower. "There’s a path for us to get there," Powell said Wed, referring
to a soft landing. "It’s not getting easier. It’s getting more
challenging."
Majority of global CEOs think a recession is looming
Chinese Pres Xi Jinping emphasized his country's commitment to trading with Russia, despite Western sanctions against Moscow over its invasion of Ukraine. “Today our cooperation between Russia and China [is] rising,” Xi said. He cited Russian Pres Vladimir Putin's visit to Beijing in early Feb. “Trade over the first half of this year has been [in the tens of billions of U.S. dollars] and we can expect new records in upcoming months, which is a testament to the great cooperation between our two nations,” Xi added. The Chinese leader was speaking via video at the St Petersburg Intl Economic Forum's plenary session, which Putin opened with a speech over an hour long. The official Chinese state media readout of Xi's remarks did not mention “new records” in trade between China & Russia. The readout did call for the removal of trade barriers & greater cooperation with other countries, including Russia. In both the Chinese readout & RT's translation, Xi emphasized how China’s economic potential has not changed & talked about the further development of the Belt & Road Initiative. Trade between China & Russia totaled $65.8B in the first 5 months of this year, up 29% from a year ago, according to China customs data. Most of the growth came from Chinese imports from Russia. Beijing has refused to call Russia’s attack on Ukraine an invasion. After a high-profile meeting between Xi & Putin in early Feb, a readout said there were “no limits” or “forbidden areas” of cooperation, without mentioning Ukraine. Earlier this week, Xi said in a phone call with Putin that Kyiv & Moscow should push for a proper settlement” in the ongoing war in Ukraine.
China’s Xi says trade with Russia expected to hit new records in the coming months
GM (GM) said that it is increasing the price of its electric Hummer by $6250, effective tomorrow. The company blamed higher prices for parts, technology & logistics. All
reservations placed before Sat are exempt from the increase, the
company said. The Hummer EV pickup truck currently goes for about
$80-100K. The announcement comes after several automakers hiked the cost
of their electric vehicles in recent weeks. The war in Ukraine &
ongoing supply chain challenges have jacked up the the prices of the raw
materials necessary for EV batteries, causing the competition to raise the prices of their electric vehicles. Reservations for GM's EV Hummer have topped 77K, according to GM, a number that has exceeded the company's initial expectations. GM said in Mar that it would ramp up production of the Hummer EV. The
Hummer EV pickup truck is for sale, but new orders are unlikely to be
fulfilled until 2024 due to the number of current reservations, a
company exec previously said. The Hummer EV SUV, which GM unveiled last year, isn’t expected to arrive until next year. The stock rose 49¢.
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 is raising the price of its electric Hummer starting this weekend
Gold futures settled lower, heading for a loss on the week as prices reversed part of a 2-session rebound on the back of risk-off sentiment that helped lift the price of the precious metal briefly north of $1850 per ounce. Aug gold declined by $9 (0.5%) to settle at $1840 an ounce. Based on the most-active contract, prices finished 1.9% lower for the week. The markets saw a busy week of activity from central banks around the world, including the Federal Reserve, Bank of England & Swiss National Bank, which all hiked their benchmark interest rates this week. The Bank of Japan stood firm on its ultra-loose monetary policy prescription. Economic data from the Federal Reserve released today showed that US industrial production rose 0.2% in May, up a 5th straight month. Yesterday, a handful of disappointing reports on the number of Americans buying homes & the number applying for unemployment benefits inspired a brief surge in gold prices.
Gold futures settle lower after wild week for markets
Oil futures finished with a loss today, with US & global
benchmark prices ending a streak of weekly gains, as investors juggled
recession fears & concerns over demand. West Texas Intermediate crude for Jul fell $8.03 (6.8%) to settle at $109.56 a barrel. Based on the front-month contract, prices
ended 9.2% lower for the week following 7 weekly gains in a row. Aug Brent crude,
the global benchmark, settled $6.69 lower (5.6%) to $113.12 a
barrel. Prices posted weekly loss of 7.3%,
breaking a string of 4 weekly gains. Oil prices struggled this week as investors backed away from perceived riskier assets in the wake of a Federal Reserve interest rate hike. Fears that the economy could tip into recession have weighed on commodities & other perceived riskier assets. The Fed rate hike was followed by a bigger-than-expected hike from the
Swiss National Bank & Bank of England also raised interest rates. Crude prices rebounded yesterday on news that the US had hit Iran with fresh sanctions. The Intl Energy Agency said earlier this week that it
expects supply growth to lag behind demand, pushing an already tight
market witnessing soaring prices into a 500K-barrel-a-day deficit.
Oil prices end lower to break a string of weekly gains as demand worries linger
Below is the Dow chart & it is especially ugly for 2022. Most of the talk revolves around recession, high inflation & rising interest rates. Today's rally (if that's what it is called) was underwhelming. After all, the stock market is vastly oversold but few bargain hunters were interested. Dow lost 1500 this week & is down a hefty 6450 YTD. Try to have a good weekend. 😀
Dow Jones Industrials
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