Dow sank 228 (near session lows), decliners over advancers 2-1 & NAZ gained 55. The MLP index was off about 1 to 221 & the REIT index fell 3+ to the 361s. Junk bond funds inched higher & Treasuries were sold. Oil gave back 2.94 & gold retreated 8 to 1885 (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)
General Motors (GM) is ready to move on from its top-selling electric vehicle to make room for larger models that run on new battery technology. "We
have progressed so far that it's now time to plan to end the Chevrolet
Bolt EV and EU production, which will happen at the very end of the
year," CEO Mary Barra said. The Bolt, which starts at $26,500, accounts for more than 90% of all GM's domestic EV sales. The
factory north of Detroit where Bolt hatchbacks & small SUVs are made
will be converted to make Chevrolet Silverado EV & electric GMC Sierra
trucks that will run on the company's next-generation Ultium EV
platform. GM sold more than 38K Bolts last year, up from some 25K in
2011. In the first qtr of 2023 alone, the company sold 19K of the
models. The Biden administration has touted the Bolt, which
qualifies for a $7500 federal tax credit, as an example of an
affordable EV. Later this year, GM plans to roll out a Chevrolet Equinox EV small SUV
with a starting price of around $30K. The nation's largest automaker
is also working with Honda to produce a lower-cost EV model. The stock was off 70¢.
If you would like to learn more about GM, click on this link:
club.ino.com/trend/analysis/stock/GM_aid=CD3289&a_bid=6aeoso5b6f7
GM to ditch its top-selling EV and shift to trucks
On the back of Q1 results that showed strong aircraft demand, Boeing (BA), a Dow stock, plans to increase output of 737 Max planes to 38 a
month from 31 later this year, despite a manufacturing issue affecting some aircraft. That
production rate would be the highest in years for the bestselling
aircraft & comes as BA seeks to get planes to airlines faster as
those customers capitalize on a rebound in air travel. The company expects to deliver 400-450 of its 737 planes this year. “This
is an important year for us,” CEO Dave Calhoun said. “As demand surges across our markets, we must focus
together on execution and meeting our customer commitments.” BA
is also planning to raise output of the 787 Dreamliner to 5 planes a
month late this year from a current rate of 3. The plans come as the company said aircraft demand& stronger
deliveries boosted BA's revenue in Q1 with sales up
28% year over year. The company narrowed its net loss to $425M (69¢ per share) from a year-earlier net loss of $1.24B
($2.06 per share). Adjusting for special items, BA lost $1.27 per share, which was a
wider loss than had been expected. The
company reported a $245M pretax charge on the company's KC-46A
Tanker program tied to supplier issues. Revenue in its
commercial airplane unit rose 60% in Q1 to $6.7B
as deliveries of new aircraft picked up, but the company said it was
partially offset by 787 Dreamliner customer compensation for delivery delays. The stock went up 81¢.
If you would like to learn more about GM, click on this link:
club.ino.com/trend/analysis/stock/GM_aid=CD3289&a_bid=6aeoso5b6f7
Boeing plans to boost 737 Max production to 38 planes per month
Norfolk
Southern (NSC) reported an initial $387M charge associated with the
company's East Palestine, Ohio, derailment in Feb, which spilled
toxic chemicals into the environment. The charge resulted in a year-over-year decline in first-quarter profits. Income from railway operations for the qtr was $711M, down 34% from the same period in 2022. Excluding the East
Palestine derailment, income from railway operations was $1.1B,
up 1% compared to the same period the year prior. Net income for the period fell to $466M ($2.04 a share) down from $703M
($2.93 a share) a year earlier. That comes despite a year-over-year jump in
revenue of roughly 7% to $3.1B. The earnings release reaffirmed CEO Alan Shaw's commitment to supporting cleanup efforts in
Ohio, pledging roughly $24M in reimbursements and investments. The National Transportation Safety Board is examining the company's
organization & safety culture through a special probe into the company. Those environmental cleanup efforts & remediation activities
contributed to the reported $387M charge. The charge also included anticipated EPA-issued oversight
costs to reimburse the gov but does not include some anticipated
legal costs related to cases such as a lawsuit brought by the state of Ohio, insurance recovery & recovery activities from other parties. The stock dropped 6.01 (3%).
If you would like to learn more about NSC, click on this link:
club.ino.com/trend/analysis/stock/NSC_aid=CD3289&a_bid=6aeoso5b6f7
Norfolk Southern reports $387 million charge after East Palestine derailment
Gold futures declined to settle back below $2000 an ounce. Worries about the US debt ceiling debate & weak regional bank earnings failed to provide enough support to keep prices for the precious metal above that key level. Gold is destined for record price highs. It is just a question of the path it will take. But the short term is a difficult call. Gold for Jun fell $8 to settle at $1996 an ounce, after touching an intraday high of $2020.
Gold Futures Settle Back Below $2,000 an ounce
US crude prices finish sharply lower after a volatile trading day, settling down 3.6% at $74.30 a barrel, the lowest closing price since Mar 29. Crude prices began the NY session lower amid rising risk aversion & worries about a recession, only to rebound into positive territory mid-morning after a mostly bullish weekly EIA report. But prices then turned lower again & sold off heavily just before the closing bell. The recession clouds are mostly behind the drop in prices.
Oil Prices End at 4-Week-Low on Recession Fears
Banking worries & increasing the debt ceiling are being watched closely. And earnings are generally underwhelming which keeps recession thoughts active.
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