Dow climbed 162 (session high), advancers over decliners better than 2-1 & NAZ gained 149. The MLP index stayed near 291 & the REIT index was up 1+ to the 376s. Junk bond fund were a little higher & Treasuries rose in price, taking yields a little lower. Oil was fractionally lower, going below 83, & gold slid 2 to 2336 (more on both below).
Dow Jones Industrials
The number of available jobs in the US unexpectedly grew in May, signaling continued resilience in the labor market. Job openings jumped higher to 8.1M in May, from a downwardly revised 7.9M in Apr, according to the Bureau of Labor Statistics' latest Job Openings & Labor Turnover Survey (JOLTS) report. The forfecast had expected openings would fall to 7.9M. Despite the uptick in job postings, which can be quite volatile May's JOLTS report marked a significant milestone for the US labor market. The ratio of job openings to those who are unemployed fell to 1.2 available jobs per job seeker, matching the figure seen in Feb 2020, a month prior to the pandemic lockdowns that shocked the global economy. That ratio has been steadily moving lower since hitting a record 2.0 in Mar 2022. Other seasonally adjusted measures of labor turnover showed continued stability in the US jobs market, which has gradually cooled in recent months while remaining historically strong. The estimated number of hires moved up to 5.8M from 5.6M in Apr; layoffs & separations bounced higher to 1.6M in May, up from 1.5M; while the number of voluntary quits inched upward to 3.46M from 3.45M. While both hires & job openings rates (as a percentage of total employment) ticked higher for May, the quits rate & layoffs rate were unchanged. Economists have been closely watching the quits rate, which has held steady at 2.2% for 7 months running, as it serves as a signal for workers' willingness to test the labor market's waters. When people switch jobs, that typically can correlate to bigger pay bumps, which in turn potentially could make it more difficult to rein in inflation.
US job openings unexpectedly grew in May
General Motors (GM) reported its best quarterly sales in more than 3 years, including
notable increases in full-size pickup trucks & all-electric vehicles. The
automaker reported sales of 697K for the 2nd
qtr, up 0.6% from a year earlier & its highest quarterly units
sold since the 4th qtr of 2020. Its
EV deliveries increased 40% compared to a year earlier to 22K units. Still, EVs made up only 3.2% of its total 2nd-qtr sales. Sales
of GM's full-size pickup trucks were roughly 229K during the 2nd
qtr, up about 6% from a year earlier & the best quarterly sales
since 2021. GM's total sales thru the first ½ of the year
were down 0.4%, however, compared to a year earlier to roughly 1.3M vehicles. GM's 2nd-qrr sales are expected to slightly outpace the overall industry. Auto industry forecasters such as Cox Automotive& Edmunds expect 2nd-qtr sales industrywide, including Jul 1,
to be roughly level from a year earlier amid slowing retail demand. An
unknown outlier in the 2nd qtr is how much of an effect
cyberattacks on dealer software provider CDK Global will have on sales. The Jun 19 ransomware attack
forced CDK, a market leader, to shut down its dealer management system,
affecting close to ½ of all dealerships in North America. “The
CDK cyberattacks have thrown a monkey wrench into sales during the
second half of June, affecting what is arguably one of the most
lucrative and busiest times of the month and quarter for dealerships,”
said Jessica Caldwell, Edmunds' head of insights. GM said its “dealers who use the CDK platform are working to
meet strong customer demand under difficult circumstances. Some
deliveries may be delayed until Q3.” The stock rose 26¢.
GM reports best U.S. quarterly sales since 2020
The Food & Drug Administration approved Eli Lilly’s (LLY) Alzheimer’s drug donanemab, expanding the limited treatment options for the mind-wasting disease in the US. The
agency approved the treatment, which will be sold under the brand name
Kisunla, for adults with early symptomatic Alzheimer's disease. Nearly 7M Americans have the condition, the 5th-leading cause of death
for adults over 65, according to the Alzheimer’s Association. By 2050,
that group is projected to rise to almost 13M in the US. It's
a long-awaited win for LLY after donanemab faced obstacles in its
path to market. The FDA rejected the drug's approval last year due to
insufficient data, then surprisingly delayed it again in Mar. Earlier this month, an advisory panel to the agency recommended the treatment for full approval, saying the benefits outweigh its risks. LLY's drug slowed Alzheimer's progression by 35% over 18 months
compared with a placebo, according to a late-stage trial. Patients were
able to end their treatment & switch to a placebo after 6, 12 or 18
months after they hit certain goals for amyloid plaque clearance. The stock fell 7.50.
FDA approves Eli Lilly Alzheimer’s drug, expanding treatment options in the U.S.
Gold prices edged lower as Treasury yields held firm, while investors digested comments from Federal Reserve Chair Jerome Powell & looked forward to US jobs data due later this week for more signals on US interest rate cuts. Spot gold was down 0.3% at $2324 per ounce & US gold futures settled 0.2% lower at $2333. The benchmark 10-year Treasury yield hit a 1-month high yesterday & stayed elevated today, making non-yielding bullion less attractive. Data today showed US job openings rose to 8.1M in May. Focus now shifts to Fri's non-farm payrolls, which will be crucial in assessing whether the US labor market remains resilient against the backdrop of decades-high interest rates. Gold is down 5% from a record high of $2449 per ounce it touched on May 20, a rally caused by safe-haven demand driven by geopolitical & economic uncertainty as well as persistent central bank buying, a crucial category of demand.
Gold down as elevated bond yields weigh, US jobs data in focus
West Texas Intermediate (WTI) crude oil closed lower, unable to stick early session gains on expectations for high summer demand, continuing violence in the Middle East & an early start to the hurricane season. WTI crude oil for Aug closed down 57¢ to settle at $82.81 per barrel, after earlier touching $87.46 & Sep Brent crude, the global benchmark, was last seen down 31¢ to $86.29. The drop comes despite expectations summer demand is surging, with forecasts calling for a big drop in US oil inventories in reports from the American Petroleum Institute & later from the Energy Information Administration. Mideast tensions continue to run hot, with Israel pressing its war on Hamas in Gaza, while threatening to expand hostilities into Lebanon as conflicts between Israeli forces & the Iran-backed Hezbollah militia heat up & Houthi militants continue attacks on Red Sea shipping. The rise also comes as Hurricane Beryl strengthened to a category 5 storm packing winds of 165-miles per hour, according to the National Hurricane Center. Beryl is the most powerful storm to ever rise in Jun, spurred by high ocean temperatures, but it is not expected to disrupt production from platforms in the northern gulf.
WTI Crude Closes Lower Despite Summer Demand, Geopolitical Risk and an Early Start to Hurricane Season
Stocks rose in the PM after comments by a Fed official that officials should be prepared for rate cuts. Otherwise the stock market had a quiet day & the Dow continues to trend sideways, a little below its 40K peak.
No comments:
Post a Comment