Dow finished down 105, decliners over advancers 3-1 & NAZ tumbled 318. The MLP index remained steady near 249 & the REIT index sank 6+ to the 319s. Junk bond funds were sold & Treasuries had heavy selling, driving yields higher. Oil rebounded 1+ to the 85s & gold was up 6 to 1992 (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)
Rep Mike Johnson of Louisiana was elected speaker of the House of Representatives, ending a 3-week leadership crisis that has paralyzed Congress. Vice chairman of the House Rep conference & a hard-right conservative, Johnson had maintained a low public profile until he was thrust into the spotlight this week after securing the party's nomination for speaker. Johnson was elected unanimously by the 220 Republicans who voted, despite being the 4th nominee tapped by the GOP conference in 2 weeks, as the deeply divided party repeatedly failed to put forward a candidate who had enough support. “It has been an arduous few weeks, and a reminder that the House is as complicated and diverse as the people we represent,” Johnson said. “The urgency of this moment demands bold, decisive action to restore trust, advance our legislative priorities, and demonstrate good governance,” he added. Johnson managed to rally the GOP conference behind his bid after recalcitrant Reps rejected the 3 previous nominees. His bid received a boost from former Pres Trump, who encouraged Reps to vote for the Louisianan. He also consolidated the backing of several moderate New York Reps who had been reluctant to support some of the more hardline conservatives who sought the top job. Johnson, who is serving his 4th term in Congress, will wield the gavel as America faces a looming gov shutdown, Israel wages war on Hamas & Ukraine struggles to beat back Russia's invasion.
Mike Johnson elected House speaker, putting Louisiana Republican in the spotlight
Boeing
(BA), a Dow stock, is reducing its 737 deliveries in 2023 after
spotting a quality issue involving the aircraft's pressure bulkhead on
certain models. While the aerospace & defense manufacturer said
that the
issue was not an immediate risk to flight safety & the in-service
fleet can continue operating, the temporary delivery snag has forced
BA to retract its plan to deliver as many as 450 jets this year to
just 375-400. "We are focused on driving stability in our supply chain
and improving operational performance as we steadily increase
production rates to meet strong demand.," CEO Dave Calhoun said.
Despite the dip in deliveries, BA said suppliers will maintain
production rate increases & bump up final assembly transition to 38
per month by year-end. In 2025 & 2026, the company will spike
production levels to 50 per month, with estimated costs to complete the
rework included in 3rd qtr results. Meanwhile, the 787 program
will also move production goals to 5 per
month & will jump to 10 per month between 2025 & 2026, while
delivering 70-80 planes this year. BA also reported 3rd qtr
earnings, generating $18B in revenue & posting a loss of $3.26 per
share. The stock dropped 4.66 (3%).
If you would like to learn more about BA, click on this link:
club.ino.com/trend/analysis/stock/BA_aid=CD3289&a_bid=6aeoso5b6f7
Boeing slashing 737 deliveries on quality issue
Alphabet
(GOOG) shares fell the most in a year after revenue in the company's
Google Cloud unit trailed estimates. The plunge came even after GOOG
beat expectations for both revenue & EPS. Its cloud miss was a
stark contrast to Microsoft's (MSFT) earnings, which showed accelerating
growth in the company's Intelligent Cloud business. GOOG posted
cloud
revenue of $8.41B, compared to estimates of $8.64B. CFO Ruth Porat said
that while
cloud growth “remained strong across geographies, industries and
products,” the expansion rate “reflects the impact of customer
optimization efforts,” a phrase that generally refers to clients reeling
in their spending. Some of those comments seemed to have spooked
analysts. The stock tumbled 13.45 (10%).
If you would like to learn more about GOOG, click on this link:
club.ino.com/trend/analysis/stock/GOOG_aid=CD3289&a_bid=6aeoso5b6f7
Alphabet’s stock is having its worst day in a year after cloud revenue missed estimates
Gold closed with a gain on safe-haven resumed on fears over a widening war in the Middle East ease as Israel prepares to invade Gaza to prosecute its war against Hamas, while the $ & treasury yields rose. Gold for Dec closed up $8 to $1994 per ounce, the highest since Jul 31. The rise comes as Israel prepares an invasion of the Gaza Strip to hunt down the Hamas militants responsible for the Oct 7 terror attacks that killed hundreds of civilians. Israeli prime minister Benjamin Netanyahu said its army is preparing to enter Gaza, though did not offer any detail on timing. However the intl focus is turning to the plight of 2M Gaza civilians who lack food, water, power & medicine because of Israel's siege. The $ moved higher, making gold more expensive for intl buyers. The ICE dollar index was last seen up 0.22 points to 106.49. Treasury yields also climbed, bearish for gold since it offers no interest. The US 2-year note was last seen paying 5.108%, up 4.1 basis points, while the yield on the 10-year note was up 12.8 points to 4.954%
Gold Rises to a Three-Month High on Safe-Haven Buying as Israel Prepares to Invade Gaza
Oil futures finished higher after posting 3 consecutive session losses. Trading is being driven more by global factors like political developments in the Middle East more than weekly inventory data. Data from the Energy Information Administration showed a 1.4M-barrel weekly rise in US crude supplies. Oil continues to attract significant support unless something significant happens on the supply, demand or political side, this upward trend remains intact. Dec West Texas Intermediate crude rose $1.65 (2%) to settle at $85.39 a barrel.
Oil Futures Settle Higher for The First Time in 4 Sessions
Dow had a midday rally, giving into a modest gain. Then sellers returned & took the Dow into the red. While the congressional House is back, numerous other problems remain for the stock market to contend with. Dow continues a little above its lows for 2023. Not good!
Dow Jones Industrials
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