Dow went up 59, advancers over decliners 3-1 & NAZ gained 32. The MLP index was up 1+ taking it over 240 & the REIT index gained 2 to 381. Junk bond funds were also higher & Treasuries had limited buying which reduced yields. Oil rose to the 81s & gold added 6 to 2006.
AMJ (Alerian MLP Index tracking fund)
The odds of the US avoiding a deep recession & achieving a "soft landing" are rising as the Federal Reserve tries to bring down inflation, but the economy isn't out of the woods yet according to a key figure at the central bank. Neel Kashkari, pres of the Federal Reserve Bank of Minneapolis said that he agrees with Fed economists who increasingly view the US economy as likely to end this inflation cycle without a significant hit to the labor market. "That’s our base case scenario, the economy continues to surprise how resilient it is, that’s a really good thing, as your reporting just showed the unemployment rate is still very low of 3.6%" Kashkari aidded. "Nonetheless, I’m not going to dismiss the hardship that Americans are feeling. High inflation for several years has really put a dent in people’s pocketbooks. We’re now starting to dig our way out of that," he explained. "So, we’re making progress. But I’m also not surprised that people are still frustrated by how long it has taken to get here." Kashkari is one of the 12 Fed officials who serve as voting members of the Federal Open Market Committee, which makes decisions about the central bank's monetary policies that influence interest rates, which in turn have an impact on the rates paid by credit card & mortgage borrowers. When asked whether the Fed plans to raise interest rates one more time in 2023 given that inflation slowed to 3% on an annual basis in Jun, down from a 40-year high of 9.1% inflation the US faced last year but still above the Fed's 2% target. Kashkari said policymakers will weigh the data before making a decision. "We need to get inflation all the way back down to 2%. And while that headline number that your reporter just shared, 3%, is really positive news, that headline number tends to move around a lot, as oil prices and gas prices and food prices fluctuate the underlying number. The core numbers more around 4.1%, that’s down from around 5.5% a year ago," Kashkari noted. "So we’re making good progress, but it’s still double our 2% rate, and so we don’t want to declare victory," he added. "If we need to hike – raise rates further from here, we will do so. But we’re gonna let the data guide us and not prejudge the outcome." Kashkari went on to say that although he thinks there will be some job losses coming to the US economy as interest rates remain elevated, he believes it will be possible to have modest increases in the unemployment rate & still manage to pull off a "soft landing" that avoids a deep recession. "I personally don’t think that’s realistic, that we’re going to end this inflation cycle with no cost to the labor market. It would not surprise me to see the unemployment rate tick up from 3.6 to 3.7, 3.8, maybe even 4%. That in my book – that would still be a soft landing," he said. "We definitely want to avoid a deep recession where you have hundreds of thousands of people losing their jobs month after month, the kind of painful recession that we have seen in the past. If we can achieve 2% inflation with only a modest softening in the labor market, I think that would be a resounding positive outcome for the country as a whole."
Minneapolis Fed chief Kashkari hopeful US economy can avoid recession as inflation fight continues
Ford (F) announced it is projected to lose a whopping $4.5B from electric vehicles (EVs) this year, up from the previous projected loss of $3B. The automaker's EV division, called "Ford Model
e," has an estimated lost $1.8B so far this year. The
projected $4.5B loss is over twice as much as Model e's $2.1B loss in 2022. The company recently announced that the price of
its electric F-150 Lightning pickup trucks will be reduced due to
cheaper raw battery materials. The company touted that its low EV
prices "establish[es] leadership ahead of industry's next-generation
EVs" & that the Ford Model e's revenue is up 39%. Ford is also
expected to produce 600K EVs per year by 2024. "The near-term pace of EV adoption will be a little slower than
expected, which is going to benefit early movers like Ford," CEO
Farley said. "EV customers are brand loyal and we’re
winning lots of them with our high-volume, first-generation products;
we’re making smart investments in capabilities and capacity around the
world; and, while others are trying to catch up, we have clean-sheet,
next-generation products in advanced development that will blow people
away." The company still generates a massive amount of revenue in
other parts of the company. Q2 revenue was $45B, with a net income of $1.9B. "Ford Model e is an EV startup within Ford," CFO John Lawler previously said in Mar. "As everyone knows, EV startups lose money while
they invest in capabilities, develop knowledge, build volume and gain
share." The stock was off 7¢.
If you would like to learn more about Ford, click on this link:
club.ino.com/trend/analysis/stock/F_aid=CD3289&a_bid=6aeoso5b6f7
Major car maker set to lose billions on electric vehicles
Treasury yields were little changed as investors digested the latest inflation data, which could affect Federal Reserve monetary policy & considered the outlook for the economy. The 10-year Treasury yield was little changed at 3.965% & the 2-year Treasury was down by a basis point at 4.887%. Yields & prices move in opposite directions & 1 basis point equals 0.01%. Investors considered what could be next for inflation & Fed monetary policy, especially regarding interest rates. That comes after Fri's reading of the personal consumption expenditures price index, the Fed's favored inflation gauge, suggested that inflation is cooling. On a monthly basis, the PCE was in line with expectations at 0.2% for Jun. The core PCE, which excludes food & energy, was up by 4.1% on an annual basis, just below the anticipated 4.2%, marking the lowest level since Sep 2021. Many investors took that as a sign that the Fed may be able to pause or end its interest rate-hiking campaign as soon as elevated rates appear to be working to cool the economy & ease inflation. Investors considered what could be next for inflation & Fed monetary policy, especially regarding interest rates. Many investors took that as a sign that the Fed may be able to pause or end its interest rate-hiking campaign as soon as elevated rates appear to be working to cool the economy & ease inflation.
Treasury yields are little changed as investors assess inflation outlook
Dow Jones Industrials
No comments:
Post a Comment