Dow dropped 348 (near session lows), decliners over advancers about 3-1 & NAZ fell 304. The MLP index continued little changed near 225 & the REIT index was off 5+ to the 436s. Junk bond funds remained weak & Treasuries continued to be sold, driving yields higher. Oil gained 2+ to the 119s & gold was off 18 to 1853 (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)
Ford (F) US sales fell just 4.5% in May from a year ago, a narrower decline
than in recent months, as it continued to see white-hot demand for its
latest vehicles amid tight supplies of new cars, trucks & SUVs. Ford & other automakers are continuing to fight through supply-chain issues,
including a global shortage of semiconductor chips, that has hampered
new vehicle production around the world for over a year. Its monthly
US sales were down by over 10% in Apr & by more than 20% in Feb & Mar. Ford said the company estimates that overall US new
vehicle sales were down about 30% from a year ago in May, meaning that
Ford likely gained market share. Ongoing disruptions to Ford's
manufacturing have led to tight inventories at its dealers. In response,
Ford has offered incentives to customers who are willing to place
orders for their vehicles & wait for them to be built & delivered. Almost ½ of Ford's retail sales in May came from customer orders
placed earlier in the year. With
chip supplies still limited, Ford has been prioritizing production of
its newest models, including the electric Mustang Mach-E crossover, the
Bronco SUV & the small Maverick pickup, as well as its highly
profitable mainstays, such as the F-Series pickups & the large Ford & Lincoln SUVs. Sales of Ford's F-Series pickups, an important
driver of company's profits, were up 6.9% in May from a year ago. Deliveries of the Mustang Mach-E were more than double the model's
year-ago total. In Jan-May, Ford has sold 763K vehicles in the UK, down 13.3% from the same period in 2021. The stock fell 39¢.
If you would like to learn more about Ford click on this link:
club.ino.com/trend/analysis/stock/F_aid=CD3289&a_bid=6ae5b6f
Ford’s U.S. sales fell just 4.5% in May amid hot demand for EVs and pickups
There is more bad news for US motorists. The national average retail price for regular gasoline jumped 4¢ to $4.71 per gallon – yet another record high. "After
several weeks of soaring gas prices, last week saw prices nationally
slow down ahead of Memorial Day, but I’m afraid the good news ends
there," Patrick De Haan, head of petroleum analysis for GasBuddy, said.
"As a result of the continued decline in gasoline inventories in recent
weeks, wholesale gas prices surged last week, which will likely boost
prices at the pump in short order." It's becoming even more
likely that the national average will reach $5 per gallon & that could
hit as soon as Jun 17, De Haan projected. And that's not even the worst of it. Other forecast call for prices to surge another 37% by Aug hitting a $6.20 per gallon national average. Currently, prices are already 52¢ higher than a month ago & $1.67 higher than a year ago. The average price for gas has already topped $4 a gallon in every state, however, California is the only state where the average price has reached $6.21.
Gas prices on the road to $5 nationwide very soon
Walmart (WMT), a Dow stock & Dividend Aristocrat, is building warehouses with a high-tech spin in hopes of delivering items to customers more quickly & growing its online business. The retailer plans to build 4 new fulfillment centers that use automation to pack 4 ship online orders more efficiently, with the first location
opening this summer in Illinois. For customers, the new warehouses will
mean next-day or 2-day delivery could be more common for items
including cereal & T-shirts. With
more of its sales coming from its website in recent years, it already has 31 facilities that prepare online orders. More than 3500 of its stores, 75% of its locations, also fulfill online orders. At its existing fulfillment centers, employees can walk 9
miles or more a day to pluck items off shelves & lug them back to
areas for packaging, said Michael Prince, VP of
supply chain innovation & automation. That won’t be necessary at
the new warehouses, where an automated system will retrieve items from
an expanded storage space & shuttle it to an area where an employee
packs it in a box, which will be custom made to fit the order’s
measurements. WMT will hire 4K people to work at the new facilities. The current starting pay at existing warehouses is $16-28 per hour & wages at the new ones will be at the higher end of that range. The stock fell 2.19.
If you would like to learn more about WMT click on this link:
club.ino.com/trend/analysis/stock/WMT_aid=CD3289&a_bid=6ae5b6f
Walmart to open high-tech fulfillment centers to ship online orders faster
Gold books a weekly loss, following 2 straight weeks of gain. Gold futures finished lower to book a weekly loss, as the $ gained versus major rivals after a stronger-than-expected rise in US nonfarm payrolls reinforced expectations for higher interest rates from the Federal Reserve in coming months. Gold for Aug shed $21 (1.1%) to settle at $1850 an ounce, its sharpest daily percentage drop since May 12. For the week, the yellow metal booked a 0.3% drop, after 2 straight weeks or gains, & despite closing yesterday at its highest since May 6. The US economy added 390K jobs in May, versus expectations for nonfarm payrolls to rise by 328K. The unemployment rate was unchanged at 3.6% versus expectations for a tick down to 3.5%, while average hourly earnings rose 0.3% versus forecasts for a 0.4% rise. Analysts said gold may continue to struggle as expectations for aggressive Federal Reserve interest rate hikes underpin the $, with the ICE US Dollar Index last month trading around a 20-year high. A stronger $ is seen as a headwind for commodities priced in the unit, making them more expensive to user of other currencies. The index rose 0.3% today.
Gold books worst day in three weeks as U.S. jobs data dulls demand
Cleveland Federal Reserve Bank
Pres Loretta Mester said she is looking for "compelling"
evidence that inflation has peaked before reducing the pace of the Fed's
interest rate hikes from what policymakers say are likely to be
half-point increments in both Jun & Jul. At
the subsequent Fed meeting in Sep, "if I don't see compelling
evidence, then I could easily be a 50 basis point in that meeting as
well," Mester said .
Fed's Mester: Could 'Easily' See 50 Bps Rate Hike in Sept, Too
Oil futures end higher, post weekly gain as traders shrug off OPEC+ output boost. Gasoline futures extended a run into record territory today, while oil
futures logged strong weekly gains a day after traders shook off a
decision by OPEC+ to raise output by larger increments in Jul & Aug. The West Texas Intermediate (WTI) for Jul added $1.61 to settle at $116.87 a barrel. Oil has been supported this week by China's moves to ease a weekslong
lockdown in Shanghai, a positive for crude demand. Meanwhile, gov
data yesterday showed US oil & product inventories fell sharply
last week, reflecting in part strong implied demand for gasoline as
summer driving season got under way. OPEC+ agreed yesterday to raise output by 638K barrels a day
in Jul & Aug, exceeding the 432K barrel-a-day increments
previously penciled in by the group. While the move could help fill the gap left by Russian crude exports
targeted by embargoes & sanctions in response to the country's
invasion of Ukraine, it isn't seen as enough to fully offset the
expected lost barrels. Moreover, they noted that OPEC+
has already fallen short on previous, smaller production boosts. Oil-field services firm Baker Hughes said the number of US
oil rigs was unchanged this week at 574, while gas rigs were unchanged
at 151 & miscellaneous rigs steady at 2.
After a strong start this week, Dow ended down 300. High inflation, the fear of rising interest rates & a struggling economy are spooking investors.
Dow Jones Industrials
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