Dow gained 138, advancers over decliners 3-2 & NAZ advanced 26. The MLP index plunged another 5+ to the 391s (not seen since the end of 2012) & the REIT index gained 4+ to the 307s. Junk bond funds were mixed & Treasuries dropped sharply. Oil sank to the low 57s on increased inventories & gold continued to slide lower.
AMJ (Alerian MLP Index tracking fund)
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The biggest automakers posted mostly improving US vehicle sales in Jun to cap the best H1 in a decade & predicted an even better finish to the year. Already accelerating auto sales will find a new gear in H2. General Motors (GM) has redesigned versions of the Malibu & Camaro coming. And Ford is finally reaching full production of its aluminum-bodied F-150 pickup & is promising a H2 sales surge of the top-selling vehicle line in America. Prices & profits are also rising along with auto sales. Relatively low gasoline prices & interest rates continue to drive up sales of sport utility vehicles & pickups, which favor the Detroit 3 automakers that specialize in those big rigs. The average vehicle sold for $33K last month, up 2.5% from a year ago. Industrywide auto sales are on pace to have risen about 4% last month, Ford said. Analysts estimated that industry sales volume would be the best for Jun in 9 years at 1.49M. New products & growing consumer confidence will push the pace even higher the rest of the year. “We just wrapped up the U.S. auto industry’s best six months in a decade,” said Kurt McNeil, GM’s US-VP of sales operations. “People feel good about their jobs and the direction the economy as a whole is taking, so the second half of the year should be strong, too.” The annualized sales rate adjusted for seasonal trends may have reached 17.2M cars & light trucks, keeping the industry on track for its best year in a decade. Fiat Chrysler Automobiles (FCAU) estimated a sales pace of 17.5M including medium & heavy trucks, which usually account for at least 200K yearly sales. GM projected a 17.3M light-vehicle rate. Nissan reported the biggest gain for Jun so far with a 13% increase, topping the 12% estimate. FCAU US sales rose 8.2 % as its Jeep sport utility vehicles & Ram trucks won buyers, maintaining a streak of gains that spans more than 5 years. Honda sales rose 4.2%, compared with estimates for a 7.1% increase. Toyota (TM) reported a 4.1% increase that exceeded the 3.3% gain estimated. The company also sees sales surging in H2. Ford missed estimates with a 1.5% light-vehicle sales gain, compared with projections for a 2.3% increase. FCAU US-based unit delivered 185K vehicles last month its 63rd straight monthly increase. GM sales fell 3% when analysts had anticipated a 3% increase, as the largest automaker slashed deliveries to rental-car companies by 45%.
Boeing, a Dow stock, raised the cost for the largest version of its updated 777X jetliner to $400M as it boosted 2015 aircraft prices 2.9% across the board. The redesigned 777-9X, a twin-aisle jet that will seat more than 400 travelers, debuted last year as its priciest plane at $388M. The 2nd-costliest model this year is the 747-8 freighter, priced at $379M. The world’s largest planemaker adjusts prices once a year to reflect an internal formula that takes into account increases in the costs of goods, services & labor. Prices rose 3.1% in 2014. The catalog prices don’t reflect the discounts that are customary in the industry. BA has 286 orders for its 777X series, which was introduced in late 2013 & won’t begin commercial service until 2020. The stock rose 2.01. If you would like to learn more about BA, click on this link:
club.ino.com/trend/analysis/stock/BA?a_aid=CD3289&a_bid=6ae5b6f7
General Mills reported weaker-than-expected revenue in its May qtr, as it continues to struggle with changing consumer tastes & a strong dollar. Profit excluding one-time items came in above expectations, while the company also saw its volume improve. CEO Ken Powell called the company's operating performance in its recently ended fiscal year "mixed." Though the convenience stores & food-services segment has logged sales growth, its largest segment, US retail, has struggled. The company has been cutting jobs & closing plants as it struggles with Americans' growing aversion to packaged foods. It expects its cost-cutting efforts to save $$285-$310M in its new fiscal year. The company forecast a mid- to single-digit increase in adjusted EPS next year, excluding currency fluctuations, & flat sales growth compared with the prior year. Meanwhile, the company continues to benefit from its acquisition of organic-food company Annie's, which it bought last year for $820M. "Our actions to respond to evolving consumer food interests--including bolstering our natural and organic portfolio with the addition of Annie's--helped strengthen our business performance in the second half of the year," Powell said. In the latest qtr, US retail sales grew 4.6% to $2.55B, helped by higher volume & net-price realization. In the intl segment, sales fell 8.8% to $1.22B on currency effects, which brought down sales growth by 18 percentage points. Convenience stores & food-service-segment sales grew 3.9% to $527M. In all, EPS was 30¢, down from 65¢ a year earlier. Excluding restructuring-related charges, a tax item & other special costs, EPS was 75¢. Revenue ticked up 0.4% to $4.3B. Excluding currency fluctuations, sales would have increased 6%. Analysts expected EPS of 71¢ on revenue of $4.53B. Gross margin improved to 35.3% from 34.6% in the prior year. The went up 1.37. If you would like to learn more about GIS, click on this link:
club.ino.com/trend/analysis/stock/GIS?a_aid=CD3289&a_bid=6ae5b6f7
A defiant Prime Minister Tsipras urged Greeks to reject an intl bailout deal in the referendum on Sun. This looks like a gloomy situation, but traders are not worried. The US economy is looking better with the latest data, although that has been subject to fits & starts during this long economic recovery. Dow continues to be in the red YTD.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CLQ15.NYM | ....Crude Oil Aug 15 | ....57.06 |  ...2.41 | (4.1%) |
The biggest automakers posted mostly improving US vehicle sales in Jun to cap the best H1 in a decade & predicted an even better finish to the year. Already accelerating auto sales will find a new gear in H2. General Motors (GM) has redesigned versions of the Malibu & Camaro coming. And Ford is finally reaching full production of its aluminum-bodied F-150 pickup & is promising a H2 sales surge of the top-selling vehicle line in America. Prices & profits are also rising along with auto sales. Relatively low gasoline prices & interest rates continue to drive up sales of sport utility vehicles & pickups, which favor the Detroit 3 automakers that specialize in those big rigs. The average vehicle sold for $33K last month, up 2.5% from a year ago. Industrywide auto sales are on pace to have risen about 4% last month, Ford said. Analysts estimated that industry sales volume would be the best for Jun in 9 years at 1.49M. New products & growing consumer confidence will push the pace even higher the rest of the year. “We just wrapped up the U.S. auto industry’s best six months in a decade,” said Kurt McNeil, GM’s US-VP of sales operations. “People feel good about their jobs and the direction the economy as a whole is taking, so the second half of the year should be strong, too.” The annualized sales rate adjusted for seasonal trends may have reached 17.2M cars & light trucks, keeping the industry on track for its best year in a decade. Fiat Chrysler Automobiles (FCAU) estimated a sales pace of 17.5M including medium & heavy trucks, which usually account for at least 200K yearly sales. GM projected a 17.3M light-vehicle rate. Nissan reported the biggest gain for Jun so far with a 13% increase, topping the 12% estimate. FCAU US sales rose 8.2 % as its Jeep sport utility vehicles & Ram trucks won buyers, maintaining a streak of gains that spans more than 5 years. Honda sales rose 4.2%, compared with estimates for a 7.1% increase. Toyota (TM) reported a 4.1% increase that exceeded the 3.3% gain estimated. The company also sees sales surging in H2. Ford missed estimates with a 1.5% light-vehicle sales gain, compared with projections for a 2.3% increase. FCAU US-based unit delivered 185K vehicles last month its 63rd straight monthly increase. GM sales fell 3% when analysts had anticipated a 3% increase, as the largest automaker slashed deliveries to rental-car companies by 45%.
Strong June for U.S. Auto Sales Portends Even Better Second Half
Boeing, a Dow stock, raised the cost for the largest version of its updated 777X jetliner to $400M as it boosted 2015 aircraft prices 2.9% across the board. The redesigned 777-9X, a twin-aisle jet that will seat more than 400 travelers, debuted last year as its priciest plane at $388M. The 2nd-costliest model this year is the 747-8 freighter, priced at $379M. The world’s largest planemaker adjusts prices once a year to reflect an internal formula that takes into account increases in the costs of goods, services & labor. Prices rose 3.1% in 2014. The catalog prices don’t reflect the discounts that are customary in the industry. BA has 286 orders for its 777X series, which was introduced in late 2013 & won’t begin commercial service until 2020. The stock rose 2.01. If you would like to learn more about BA, click on this link:
Boeing Boosts 2015 Jet Prices 2.9% as 777X Jumps to $400 Million
Boeing (BA)
General Mills reported weaker-than-expected revenue in its May qtr, as it continues to struggle with changing consumer tastes & a strong dollar. Profit excluding one-time items came in above expectations, while the company also saw its volume improve. CEO Ken Powell called the company's operating performance in its recently ended fiscal year "mixed." Though the convenience stores & food-services segment has logged sales growth, its largest segment, US retail, has struggled. The company has been cutting jobs & closing plants as it struggles with Americans' growing aversion to packaged foods. It expects its cost-cutting efforts to save $$285-$310M in its new fiscal year. The company forecast a mid- to single-digit increase in adjusted EPS next year, excluding currency fluctuations, & flat sales growth compared with the prior year. Meanwhile, the company continues to benefit from its acquisition of organic-food company Annie's, which it bought last year for $820M. "Our actions to respond to evolving consumer food interests--including bolstering our natural and organic portfolio with the addition of Annie's--helped strengthen our business performance in the second half of the year," Powell said. In the latest qtr, US retail sales grew 4.6% to $2.55B, helped by higher volume & net-price realization. In the intl segment, sales fell 8.8% to $1.22B on currency effects, which brought down sales growth by 18 percentage points. Convenience stores & food-service-segment sales grew 3.9% to $527M. In all, EPS was 30¢, down from 65¢ a year earlier. Excluding restructuring-related charges, a tax item & other special costs, EPS was 75¢. Revenue ticked up 0.4% to $4.3B. Excluding currency fluctuations, sales would have increased 6%. Analysts expected EPS of 71¢ on revenue of $4.53B. Gross margin improved to 35.3% from 34.6% in the prior year. The went up 1.37. If you would like to learn more about GIS, click on this link:
club.ino.com/trend/analysis/stock/GIS?a_aid=CD3289&a_bid=6ae5b6f7
General Mills Revenue Growth Weaker Than Views
General Mills (GIS)
A defiant Prime Minister Tsipras urged Greeks to reject an intl bailout deal in the referendum on Sun. This looks like a gloomy situation, but traders are not worried. The US economy is looking better with the latest data, although that has been subject to fits & starts during this long economic recovery. Dow continues to be in the red YTD.
Dow Jones Industrials
...0.91
