Dow jumped 435 (session high with strong buying in the PM), advancers over decliners 5-2 & NAZ shot up 322. The MLP index stayed near 253 & the REIT index rose 5+ to 442. Junk bond funds continued in demand & Treasuries saw a little buying. Oil rose 1+ to the 116s & gold advanced a big 24 to 1873 (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)
US factory orders decelerated in Apr, climbing less than expected
amid persistent disruptions in the global supply chain – even as
consumer demand for goods remained strong. The
Commerce Dept said that factory orders rose 0.3% in
Apr, sharply missing the gain of 0.7% forecast. That's also a big decline from Mar, when factory orders
rose by 1.8%. Americans
continued to order machinery motor vehicles & primary metals in
Apr, but orders for electrical equipment, appliances & components
fell 0.2%. Orders for computers & electronic products inched up 0.1%. Shipments of manufactured goods, meanwhile, rose just 0.2% after climbing 2.2% in Mar & inventories at factories rose 0.6%. The
report also showed that orders for non-defense capital goods – known as
core orders, which are viewed as a more accurate measure of consumer
spending – jumped 0.4% in Apr. Strong consumer demand for
machines, electronics, cars & other durable goods has fueled activity
at factories over the past year. But tangled supply chains & a
persistent labor shortage have weighed on manufacturing – while also
contributing to the highest inflation in nearly 4 decades. The
data comes amid broader fears of an economic slowdown: Inflation is
near a 40-year high, COVID-19 is still forcing lockdowns in China &
the Russian war in Ukraine is further exacerbating supply chain
disruptions. A growing number of analysts are now forecasting a recession
in the next 2 years. Economic growth in the US is already slowing. The Bureau of Labor
Statistics reported earlier this month that GDP
unexpectedly shrank in Q1 marking the worst
performance since the spring of 2020, when the economy was still deep in
the throes of the COVID-induced recession. Fed Chair Jerome Powell
has acknowledged there could be some "pain associated" with reducing
inflation & curbing demand but pushed back against the notion of an
impending recession, identifying the labor market & strong consumer
spending as bright spots in the economy. Still, he has warned that a
soft landing is not assured.
US factory orders slowed in April as supply chains, labor shortages persist
Microsoft (MSFT), a Dow stock, slipped after the tech giant cut its profit & revenue guidance for the 4th qtr of fiscal year 2022, citing unfavorable foreign exchange rate movement. Total revenue for the qtr is now expected to fall to $51.9-52.7B, down from $52.4-53.2B. Productivity & business processes segment
revenue has been revised to $16.5-$16.7B, down from
$16.6-$16.9B, while intelligent cloud revenue has
been adjusted to $20.9-21.1B, down from $21.1-21.4B. Revenue is expected at $14.5-14.84B for its
more personal computing segment, down from $14.6-14.9B. CFO Amy Hood previously warned that exchange rates could impact the company's guidance in Apr. "We
expect other income and expense to be negative $50 million, reflecting
FX remeasurement impact based on market conditions in April," Hood said
at the time. "Similar to the rest of our guidance, further equity and FX
movements through Q4 are not reflected in this number." Analysts are forecasting EPS of $2.33 on revenue of $52.9B. The stock went up 2.16.
If you would like to learn more about MSFT click on this link:
club.ino.com/trend/analysis/stock/MSFT_aid=CD3289&a_bid=6ae5b6f
Microsoft cuts revenue, profit outlook, citing 'unfavorable' foreign conditions
Federal Reserve Vice Chair Lael Brainard said that it's unlikely the central bank will be taking a break from its current rate-hiking cycle anytime soon. Though she stressed that Fed policymakers will remain data-dependent, Brainard said the most likely path will be that the increases will continue until inflation is tamed. “Right now, it’s very hard to see the case for a pause,” she said. “We’ve still got a lot of work to do to get inflation down to our 2% target.” The idea of implementing 2 more 50 basis point rate increases over the summer then taking a step back in Sep has been floated by a few officials, most notably Atlanta Fed Pres Raphael Bostic. Minutes from the May FOMC meeting indicated some support for the idea of evaluating where things stand in the fall, but there were no commitments. In recent days, however, policymakers including San Francisco Fed Pres Mary Daly & Governor Christopher Waller have stressed the importance of using the central bank's policy tools aggressively to bring down inflation running around its fastest pace since the early 1980s. “We’re certainly going to do what is necessary to bring inflation back down,” Brainard added. “That’s our No. 1 challenge right now. We are starting from a position of strength. The economy has a lot of momentum.” Brainard said, however, that bringing inflation down remains the top priority & shouldn't significantly harm an economy where household & corp balance sheets are strong. Markets already are pricing in 2 50 basis point increases at the next meetings, which Brainard called “a reasonable kind of path.” Beyond that, though, “it’s a little hard to say,” she added, noting both upside & downside risks to growth.
Fed Vice Chair Brainard says it’s hard to see the case for Fed pausing hikes
OPEC & its oil-producing allies (OPEC+)agreed to hike output in Jul & Aug by a larger-than-expected amount as Russia's invasion of Ukraine wreaks havoc on global energy markets. OPEC+ will increase production by 648K barrels per day in Jul & Aug, bringing forward the end of the historic output cuts OPEC+ implemented during the throes of the Covid pandemic. The group has been slowly returning the nearly 10M barrels per day it agreed to pull from the market in Apr 2020. In recent months, production has risen 400-432K barrels per day each month. Oil prices reversed early losses during mid-morning trading & continued to move higher during the session. The decision comes as the world grapples with surging energy prices. Govs, including the Biden administration, have been calling on producers to raise output in an effort to dampen oil's wild ride. White House press secretary Karine Jean-Pierre said the administration welcomed OPEC+'s announcement. “We recognize the role of Saudi Arabia as the chair of OPEC+ and its largest producer in achieving this consensus amongst the group members,” she said, before adding that the “United States will continue to use all tools at [its] disposal to address energy prices pressures.” While in theory output will be higher looking forward, OPEC+ has been struggling to meet production quotas. Moreover, the additional barrels slated to hit the market will not make up for the potential loss of more than 1M barrels per day from Russia as nations around the world ramp up sanctions following the invasion of Ukraine.
OPEC+ raises output faster than expected as Russia’s war roils global energy markets
Gold closed higher, erasing declines from earlier in the week, while the yellow metal also scored its highest close in about a month. The move comes as Treasury yield & the $ retreated, making precious metals more attractive by comparison. Jittery investors had been flocking to other safe-haven assets for safety, but precious metals have started Jun higher after 2 straight months of losses. Gold for Aug delivery rose 1.2% to settle at $1871 an ounce its highest close since May 6 & the best daily percentage gain since May 19. The yellow metal also is now up 1.3% on the month.
Gold scores best day in 2 weeks and highest close in about a month
Oil ends higher as OPEC+ boosts output, U.S. crude inventories tumble
Dow Jones Industrials
No comments:
Post a Comment