Dow was off 9, advancers ahead of decliners 4-3 & NAZ closed up 52. The MLP index was off 2+ to the 284s & the REIT index rose 4+ to the 382s. Junk bond funds were mixed & Treasuries continued to be purchased which reduced yields from their multi month highs. Oil retreated 1+ to the 85s & gold rose 16 to 2367 (more on both below).
AMJ (Alerian MLP Index tracking fund)
Intel (INTC), a Dow stock, unveiled its latest artificial intelligence chip, called Gaudi 3, as chipmakers rush to produce semiconductors that can train & deploy big AI models, such as the one underpinning OpenAI’s ChatGPT. The new Gaudi 3 chip is over twice as power-efficient as & can run AI models one-and-a-half times faster than Nvidia's (NVDA) H100 GPU. It also comes in different configurations like a bundle of 8 Gaudi 3 chips on one motherboard or a card that can slot into
existing systems. INTC tested the chip on models like Meta's (META) open-source Llama & the Abu Dhabi-backed Falcon. It said Gaudi 3 can
help train or deploy models, including Stable Diffusion or OpenAI’s
Whisper model for speech recognition. INTC says its chips use less power than NVDA's. INTC said that the new Gaudi 3 chips would be available to customers in the 3rd qtr & companies will build systems with the chips. INTC didn't provide a price range for Gaudi 3. “We
do expect it to be highly competitive” with Nvidia’s latest chips, said
Das Kamhout, VP of Xeon software at INTC. “From our competitive pricing, our distinctive open
integrated network on chip, we’re using industry-standard Ethernet. We
believe it’s a strong offering.” The
data center AI market is also expected to grow as cloud providers &
businesses build infrastructure to deploy AI software, suggesting there
is room for other competitors even if NVDA continues to make the vast
majority of AI chips. Running generative AI & buying NVDA GPUs
can be expensive, so companies are looking for additional suppliers to
help bring costs down. INTC stock was up 35¢.
Boeing
(BA), a Dow stock, airplane deliveries dropped in the first qtr to the lowest number
since mid-2021 as the company faces increased scrutiny after a door
plug blew out from one of its 737 Max 9 planes midair in Jan. The
company handed over 83 planes in the 3 months ended Mar 31, most
of them 737s, compared with 157 in the prior qtr & 130 planes in
the year-earlier period. Solely in Mar, BA delivered 29 planes. Airbus said that it delivered 142 planes in the first 3
months of the year, 63 of them in Mar. BA
customers are still ordering new jets from the manufacturer, which
along with Airbus dominates the large jetliner market. The company
logged orders for 111 for new planes last month when stripping out two
cancellations, 85 of them 737 Max aircraft for American Airlines (AAL), which the carrier announced in early Mar. The latest tally comes after the Jan 5 accident on Alaska Airlines (ALK) Flight 1282 brought BA inches from a catastrophe. Federal accident investigators said the door plug was missing bolts
that hold it in place. Since the accident, the Federal Aviation
Administration has inspected Boeing’s 737 Max production & barred the
plane maker from increasing output of the jets until it signs off on its
quality control procedures. BA execs have said the
company is slowing down its production to improve quality control &
avoid traveled work, when repairs or other tasks occur out of
sequence. “We won’t rush or go too fast,” BA CFO Brian West
said last month. “In fact, we’re
deliberately going to slow to get this right. And we are the ones who
made the decision to constrain rates on the 737 program below 38 per
month until we feel like we’re ready. And we’ll feel the impact of that
over the next several months.” BA stock dropped 3.43.
Boeing’s quarterly airplane deliveries drop to 83 amid safety crisis
General Motors (GM) Cruise self-driving vehicle unit will redeploy cars on US roadways for the first time since Oct, beginning with a small fleet
of human-driven vehicles in Phoenix, the company said. The relaunch comes after the company ceased operations
weeks after an Oct 2 accident in which a pedestrian in San Francisco
was dragged 20 feet by a Cruise robotaxi after being struck by a
separate vehicle. The
redeployed vehicles will not operate as they previously did, as
robotaxis, but will “create maps & gather road information in select
cities, starting in Phoenix,” the company said. Cruise said its
“goal is to resume driverless operations,” however it did not provide a
timeline for doing so. It also did not announce a timetable for
expanding human-driven vehicles to other cities. “We have not yet
made a commitment to where or when we will start supervised or
driverless operations,” a spokesperson said. Still,
the company called the relaunched fleet with human drivers “a critical
step for validating our self-driving systems as we work towards
returning to our driverless mission.” “In October 2023, we paused
operations of our fleet to focus on rebuilding trust with regulators and
the communities we serve, and to redesign our approach to safety,” Cruise said. “We’ve made significant progress, guided by new company leadership,
recommendations from third-party experts, and a focus on a close
partnership with the communities in which our vehicles operate. We are
committed to this improvement as a continuous effort.” GM stock was up 39¢.
GM’s Cruise to relaunch vehicles with human drivers in Phoenix
Gold pushed up to another fresh record high, climbing again as treasury yields moved lower ahead of fresh US inflation data coming tomorrow. Gold for Jun was last seen up $10 to $2361 per ounce, while spot gold was up $7 to $2346. The rise comes ahead of tomorrow's release of the Mar US consumer price index, which is expected to show a headline rise of 3.7% annualized, up from 3.2% in Feb, while the core rate, which excludes volatile food & energy, is seen rising 3.7%, down from 3.8% a month earlier. The geopolitical concerns that have supported gold's rise to a series of records eased somewhat today after Israel removed troops from southern Gaza while ceasefire talks continue between the country & the Hamas militant group. However Israel still plans to assault the city of Rafah, Israeli Prime Minister Benjamin Netanyahu said, despite intl protests over the prospect of further civilian casualties. The $ was steady ahead of the inflation data, with the ICE dollar last seen up 0.01 points to 104.15. Treasury yields eased, bullish for gold since it offers no interest. The 2-year note was last seen paying 4.745%, down 5.4 basis points, while the yield on the 10-year note was down 6.7 basis points to 4.363%.
Gold Shining At Fresh Record Highs as the Dollar and Yields Fall Ahead of Wednesday's US CPI Data
West Texas Intermediate crude oil slipped for a 3rd-straight session as Middle East tensions ease slightly & the US Energy Information Administration lowered its 2024 demand-growth forecast. WTI crude for May closed down $1.20 to settle at $85.23 per barrel. while Jun Brent crude, the global benchmark, closed down 96¢ to $89.42. The geopolitical concerns that pushed prices to the highest in more than 5 months last week have cooled somewhat after Israel removed troops from southern Gaza while ceasefire talks continue between the country & the Hamas militant group. However Israel still plans to assault the city of Rafah, Israeli Prime Minister Benjamin Netanyahu said, despite intl protests over the prospect of further civilian casualties. Still, Iran has yet to carry thru on threats to Israel's embassies after an attack on its Syrian embassy last week that killed several of its senior military officials, while Ukraine's attacks on Russian refineries have pushed up the price of refined products.
WTI Crude Oil Slips Again as Geopolitical Concerns Ease and the EIA Lowered its 2024 Demand-Growth Outlook
First qtr earnings reports will begin on Fri with JPMorgan (JPM) along with other banks. That should be something to look forward to. In the meantime, CPI will be released tomorrow & PPI on Thurs. And gold has risen almost $300 in 2024!!
Dow Jones Industrials
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