Dow gained 314 (down 150 from its high & still below 34K), advancers over decliners more than 3-1 & NAZ went up 160. The MLP index added 1+ to go over 250 & the REIT index advanced 4+ to the 342s. Junk bond funds had more selling & Treasuries continued to be sold, bringing higher yields. Oil was off 1 to 86 (but near the 1 year high) & gold lost 10 to 1931 (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) Exec Chair Bill Ford urged the United Auto Workers (UAW) to come together with the company to reach an agreement to end the union's ongoing strike, saying America's entire auto industry is at risk if the strike against Ford, General Motors (GM) & Stellantis (STLA) is prolonged. "Today, as the UAW strike against Ford continues, we are at a crossroads," Ford said. "Choosing the right path is not just about Ford’s future and our ability to compete. This is about the future of the American automobile industry." "I call on my great UAW colleagues, some of whom I've known for decades… We need to come together to bring an end to this acrimonious round of talks," he urged. Ford said the US auto industry is critical to the country's national security, & added that "Toyota, Honda, Tesla and others are loving this strike because they know the longer it goes on, the better it is for them." UAW Pres Shawn Fain responded to Ford's remarks with another threat to escalate the strike further. "Bill Ford knows exactly how to settle this strike. Instead of threatening to close the Rouge, he should call up Jim Farley, tell him to stop playing games and get a deal done, or we’ll close the Rouge for him," Fain said. "It's not the UAW and Ford against foreign automakers. It's autoworkers everywhere against corporate greed. If Ford wants to be the all-American auto company, they can pay all-American wages and benefits. Workers at Tesla, Toyota, Honda, and others are not the enemy – they're the UAW members of the future." The UAW launched its simultaneous but limited strike against Ford, GM & StTLA, beginning with one plant at each manufacturer. The union has incrementally expanded the strike to other facilities & has so far shut down & assembly plants, 3 of which are Ford's, along with 38 parts depots owned by GM & STLA.
Ford chairman calls for deal to end UAW strike, warns entire US auto industry at stake
Rite Aid filed for Chapter 11 bankruptcy protection & said it would begin restructuring to significantly reduce its debt. The company said it reached a deal with creditors on a restructuring plan that includes evaluating its retail footprint & closing underperforming locations. Rite Aid also said lenders agreed to extend $3.45B in new funding to “provide sufficient liquidity” as it embarks on its restructuring plan. The beleaguered drugstore chain has been grappling with slowing sales, mounting debt & a slew of lawsuits that allege the company helped fuel the nation's opioid epidemic by oversupplying painkillers. During its most recent qtr ended Jun 3, revenue fell to $5.65B, down from $6.01B in the year-ago period. Its net loss widened to $307M, $5.56 per share, compared with a net loss of $110M, $2.03 per share, in the same period a year earlier. As a result of the rough qtr, Rite Aid lowered its fiscal 2024 outlook & warned investors it expects to lose $650-680M for the full year, which is slated to end in late Feb. The retail pharmacy segment has long been a key growth driver for the company, but that hasn't been enough to offset its mounting losses. Plummeting demand for Covid vaccines & testing, a membership reduction in the company's prescription drug plan, & a loss of customers from its Elixir pharmacy benefits business have contributed to a slowdown in revenue at the struggling drug chain. Yesterday, the company appointed Jeffrey Stein as its new CEO & chief restructuring officer as well as a member of its board. Elizabeth Burr had been serving as interim CEO since Jan & will remain on the company’s board. Chair Bruce Bodaken said: “Jeff is a proven leader with a strong track record of guiding companies through financial restructurings. We look forward to benefitting from his contributions and leveraging his expertise as we strengthen Rite Aid’s foundation and position the business for long-term success.”
Rite Aid files for bankruptcy amid slowing sales, opioid litigation
Israeli Prime Minister Benjamin Netanyahu's office appeared to deny reports of a humanitarian corridor that would allow the passage of foreign nationals out of the Gaza Strip via Egypt's Rafah crossing. Some 600 American passport holders, as well as an unconfirmed number of other foreign nationals, are stuck in the blockaded enclave as it endures fierce Israeli bombardment. “There is currently no cease-fire and humanitarian aid in the Gaza Strip in exchange for the expulsion of foreigners,” Netanyahu's office said. Pres Biden warned that an Israeli re-occupation of Gaza would be a “big mistake”. He also said that the Palestinian militant group Hamas should be eliminated entirely, but that “there must be a path to a Palestinian state.” The White House has so far fully supported what it says is “Israel’s right to defend itself.” Israel is on its 10th day of an aerial bombardment campaign of the Gaza Strip, over which it has ordered a total siege, cutting off water, food & electricity supplies to a population of 2M people. The siege, which has been criticized by human rights groups for breaking humanitarian law, comes in response to a brutal terrorist attack by Hamas on Oct 7. The death toll from the conflict so far has risen to at least 1400 people killed in Israel & nearly 2700 people killed in Gaza. Amid ongoing conflict, the pres's of Russia & Syria have urged an end to hostilities. The UN Palestinian refugee agency, UNRWA, said its aid workers will no longer be able to continue humanitarian operations in the Gaza Strip unless new supplies are allowed into the enclave. Israel's military continued to urge residents to move from northern Gaza to the south as it pledged to counter Hamas with “an even greater force.” The evacuation orders have been criticized by many humanitarian agencies.
Blinken meets with Israeli president, promises U.S. support; Gaza-Egypt border still closed
Gold prices fell on higher yields after rising more than 5% last week on safe-haven buying as tensions rise in the Middle East following the Hamas terror attack on Israel earlier this month. Gold for Dec closed down $7 to settle at $1934 per ounce. The metal pushed back above the $1900 mark last week as investors turned to the metal's safe haven amid geopolitical turmoil as Israel prepares for a land assault on the Gaza strip & Iran makes threats over a widening war. The price of the metal had weakened prior to the turmoil on worries the Federal Reserve will continue to boost interest rates. While the Israel-Hamas war will drive haven flows towards gold, the look for the price hinges on the Fed rate cycle nearing an end. This will result in a retreating US yield, reducing the opportunity cost of gold. The $ weakened early, with the ICE dollar index last seen down 0.38 points to 106.27. However treasury yields are rising, bearish for the metal since it offers no interest & the 2-year note was last seen paying 5.092%, up 4.2 basis points, while the yield on the 10-year note was up 9.7 basis points to 4.724%.
Gold Closes Lower as Treasury Yields Rise; Safe-Haven Buying Continues to Offer Support
Oil futures finished lower after posting a sharp gain on Fri, as traders continued to monitor global risks to oil supplies in the wake of the Israel-Gaza war & reports that the US may reach a deal with Venezuela to ease oil sanctions. Nov West Texas Intermediate crude fell $1.03 (1.2%) to settle at $86.66 a barrel.
Oil Futures Finish Lower as Traders Weigh Risks to Oil Supplies
This will be a big week for earnings & everybody is expecting good reports. Meanwhile the abundance of problems will be a significant drag. There are 2 major wars on the globe & they don't look like they will be settled soon. The US has a major strike which is getting ugly, high interest rates & inflation persist. Then there is the southern border disaster & crime has become a huge problem. The Dow is back to where it was at the beginning of Dec (see below). Investors desperately need good news from the earnings reports.
Dow Jones Industrials
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