Dow rose 47 (near breakeven for the entire session), advancers over decliners 2-1 & NAZ gained 184. The MLP index remained in the 201s & the REIT index was off 1 to the 414s. Junk bond funds were in demand & Treasuries had a little selling. Oil slid below 100 again & gold was off 11 to 1699 (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)
Macy's (M) is accelerating its plans to open smaller stores that aren’t attached to suburban shopping malls, in a bid to evolve along with its customers' shopping preferences coming out of the Covid pandemic. The department store chain said that it will open 3 stores this fall that each represent ways Macy's is thinking about how it aims to reposition its real estate in the future. That includes:
- Combining some of its different businesses under one roof
- Closing one of its department stores at a traditional mall to open a smaller-format Macy's store, known as The Market by Macy's, in a more densely populated part of town nearby
- Adding another Market by Macy’s location in an area where it already has multiple of those shops
“We
want to be convenient and we want to make it easy,” Marc Mastronardi,
Macy's chief stores officer, said. “Customer behavior
just keeps changing. And the more that we have the agility as an
organization to shift and react, this feels like the next natural
evolution.” This fits into a broader strategy that Macy’s laid out to investors in Feb 2020,
shortly before Covid-19 cases began to ramp up in the US. At
the time, the company said it planned to shutter 125 stores in
lower-tier malls within 3 years & would explore formats outside of
malls. Since then, Macy’s has opened 5 stores under the Market
by Macy's banner, which are about 1/5 of the size of its
full-line locations & tout services such as buy online, pick up in
store. It will reach 8 by the end of this year. The stock rose 40¢.
If you would like to learn more about Macy's, click on this link:
club.ino.com/trend/analysis/stock/M?a_aid=CD3289&a_bid=6ae5b6f7
Macy’s speeds up plans to open smaller stores outside of malls
The Senate voted to advance a slimmed-down version of its bill designed to boost US semiconductor competition with China. The bill cleared a key procedural hurdle yesterday evening in a 64-34 vote even as lawmakers worked to finish various sections of the legislation. The bill, which would provide about $50B in subsidies to bolster US computer chip manufacturing, is a multifaceted bipartisan effort that combines the interests of several committees, ranging from national security to economics. The Senate's procedural step forward paves the way for the chamber to hold a vote on final passage later this week or early next week. The bill would then travel to the House for passage before it would head to Pres Biden's desk for signature into law. The broadest aim of the legislation is to incentivize semiconductor production within the US to decrease dependence on Asia-based manufacturers. Administration officials say a larger domestic chip industry would help ease the supply chain disruptions that have hampered the economic recovery from Covid-19 & insulate the US from supply routes dominated by political rival China. A global shortage of chips over the past 2 years rippled thru several industries, including automakers, mobile phone & consumer technology companies & defense systems manufacturers.
Senate advances more than $50 billion bill to boost U.S. semiconductor production
Europe is suffering under an unprecedented heat wave, leaving firefighters in London dealing with a huge surge in emergency calls. “Yesterday was the busiest day for the fire service in London since the Second World War,” Sadiq Khan, the mayor of London, said. On a normal day, the fire service will get 350 calls, Khan said. On a busy day, the London fire service would get 500 calls. Yesterday, the London fire service received more than 2600 calls, Khan said. There were 41 properties destroyed in London due to wildfires & 16 firefighters were injured battling the blazes, Khan added. “It is important for us to recognize that one of the consequences of climate change and these sorts of temperatures that lead to the fires you are seeing,” Khan continued. “The challenge in London is we have a lot of grass, a lot of green spaces and a lot of that impinges on properties. And when you have not had rain for a long period, when the grass is incredibly dry, fires can start very quickly and spread even faster because of wind and that leads to properties being destroyed.” “A lot of the problems we have here today are a direct consequence of climate change, excess death because of the heat wave,” Khan said. “A lot of these problems can be solved by tackling climate change expediently, rather than kicking the can down the road.” Beyond the UK, firefighters in In France, Spain & Greece are fighting to keep back wildfires exacerbated by heat & dry conditions.
Europe heat wave: London fire department has busiest day since WWII
Gold futures declined as the $ found its footing following a brief pullback, dragging prices for the metal back down to their lowest settlement in more than 15 months. Gold futures for Aug fell $10 (0.6%) to settle near $1700 an ounce, the lowest finish for a most-active contract since Mar 2021. A softer $ offered the precious metal some breathing room earlier in the week, but bears are clearly in the vicinity. The ICE US Dollar index was 0.5% higher today, putting pressure on $-denominated prices of gold. Although gold is seen as a hedge against inflation, it remains under the mercy of rate-hike expectations thanks to its zero-yielding nature. Investors have cut bets on how aggressive the Federal Reserve may be when raising interest rates this month, but the high interest rate environment is likely to dim the precious metals allure. For now, gold is waiting for a fresh directional catalyst to pierce below the $1700 psychological support.
Gold prices fall back to a more than 15-month low
Oil futures ended with a loss,
pulling back after posting gains in each of the last 3 trading
sessions. The Energy Information Administration reported a
400K-barrel weekly fall in US crude supplies, even as 5M
barrels of oil supplies were released from the Strategic Petroleum
Reserve. Still, with crude oil having come off of 3 strong days, today's actions feels like a normal & consolidation of
recent gains. On its expiration day, Aug West Texas Intermediate (WTI)
crude fell $1.96 (1.9%) to finish at $102.26 a barrel. The new front-month contract, Sep WTI
crude,
settled at $99.88, down 86¢ (0.9%). Meanwhile,
natural-gas futures climbed by more than 10% as hot weather in much of
the US buoyed prospects for cooling demand. Aug natural gas rose 74¢ (10.2%) to settle at $8.007 per M British
thermal units, the highest finish since Jun 13.
Oil prices end lower after a 3-session climb; natural gas rallies
The bullish case for stocks is with a slowing economy, the Federal Reserve may have no choice but to put the brakes on its aggressive pace of rate hikes later this year. However, even a slower rate of hikes could bring a collective rate hike of 150 basis points to around 3%+. In the last decade, the highest rate has been 2.5%. Higher rates may be difficult to take for investors who have become addicted to low rates.
Dow Jones Industrials
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