Tuesday February 7 Daily Market Primer
- · US stocks eased
- · Draghi defends
- · Justice tries to unban the ban…ban
- · Brokerages move on the fiduciary rule
US
stocks eased off near record levels as investors turned cautious again after last
Friday’s rally. The Euro fell on political uncertainty in France,
the yen strengthened and emerging markets advanced. The last
article explains some of National Front candidate Marine Le Pen’s proposals
that have European leaders rattled. ECB President Mario Draghi
addressed the European Union parliament yesterday, recommitting to quantitative
easing, and delivered an anti-populist message, defending the euro and arguing
against undoing Dodd Frank. Asian markets are down slightly, Europe
is up, and US futures are up this morning.
LAST
|
CHANGE
|
% CHANGE
|
|
20,071.46
|
186.55
|
0.94%
|
|
5,666.77
|
30.57
|
0.54%
|
|
2,297.42
|
16.57
|
0.73%
|
|
1,377.84
|
20.41
|
1.50%
|
|
2,613.20
|
-1.86
|
-0.07%
|
|
Stoxx
Europe 600
|
363.53
|
1.93
|
0.53%
|
Nikkei
225
|
18,910.78
|
-65.93
|
-0.35%
|
UK:
FTSE 100
|
7,216.42
|
44.27
|
0.62%
|
CBOE
Volatility
|
11.09
|
0.12
|
1.09%
|
Australia:
S&P/ASX 200
|
5,621.90
|
6.30
|
0.11%
|
3,153.09
|
-3.90
|
-0.12%
|
|
23,331.57
|
-16.67
|
-0.07%
|
|
Europe
Dow
|
1,582.96
|
-27.06
|
-0.37%
|
India:
S&P BSE Sensex
|
28,335.16
|
-104.12
|
-1.68%
|
France:
CAC 40
|
4,786.18
|
8.10
|
0.17%
|
Germany:
DAX
|
11,578.80
|
68.96
|
0.60%
|
Italy:
FTSE MIB
|
18,761.75
|
68.10
|
0.36%
|
Spain:
IBEX 35
|
9,386.90
|
29.60
|
0.32%
|
0.531
|
0/32
|
||
1.169
|
-1/32
|
||
1.867
|
-3/32
|
||
2.426
|
-4/32
|
||
3.069
|
-12/32
|
||
-0.771
|
0/32
|
||
0.375
|
-1/32
|
||
52.89
|
-0.12
|
-0.23%
|
|
55.64
|
-0.08
|
-0.14%
|
|
3.101
|
0.051
|
1.67%
|
|
395.97
|
-0.79
|
-0.20%
|
|
2293.25
|
6.75
|
0.30%
|
The Justice Department
will try to get the ban on the travel ban reversed today in federal appeals
court San Francisco. Major technology firms have filed a legal brief
against the ban. This is interesting since many of these
companies CEO’s are also on President Trump’s tech advisory council, and
because the first major policy fight for the new administration is occurring
mostly outside of congress. Greece is in trouble on its debt
covenants, as the IMF announced it is not meeting targets. You might
want to pick up some Greek 2 year paper, which is yielding about 10%. GM
reported this morning, saying Q4 net income fell partly because of currency
losses. Oil giant BP reported disappointing earnings and the
lowest profit in a decade, saying its breakeven oil price is $60/barrel. Uh
Oh. Not only is Apple making the most money, but it’s the selling more
phones than Samsung for the first time since 2011. This probably
won’t last though, since Samsung sales were badly hurt by the auto-combusting
Galaxy Note 7 fiasco. And, the WSJ reports that most brokerage firms are
going ahead with already made changes to comply with the fiduciary rule,
regardless of whether Mr. Trump’s executive order results in a delay http://bit.ly/BrokersMove.
Here’s
the news:
|
|
An appellate court in San Francisco will hear arguments from
Justice Department lawyers today demanding the reinstatement of a travel
ban on nationals from seven Muslim-majority countries. Google
parent company Alphabet Inc. is organizing the funding of a legal brief opposing the
president's executive order in what has become the first major policy
challenge for the new administration. President Donald Trump continues to defend the ban on
Twitter in his familiar style.
|
|
|
The greenback is heading for its biggest advance in three weeks, with the
Bloomberg Dollar Spot Index gaining 0.8 percent by 5:15 a.m. ET as the
currency strengthened against all major peers. The pound was among the biggest losers, falling to a two-week low
as Brexit and economic growth concerns return to put pressure on sterling.
Meanwhile, nerves over Europe's upcoming elections
continue to haunt the euro.
|
|
|
It's deja vu all over again as the International Monetary Fund
says that Greece won't meet targets set by Europe for the
country to run a budget surplus. The fund also reiterated its view that Greece's debt levels are unsustainable.
European Central Bank president Mario Draghi reaffirmed that the euro is irreversible in response to
questions yesterday at the European Parliament.
|
|
|
Overnight, the MSCI Asia Pacific Index slipped 0.3 percent,
with Japan's Topix index also dropped 0.3 percent as exporters
lead the declines. In Europe, the Stoxx 600 Index had gained 0.4 percent by 5 :39 a.m. ET as
real-estate stocks were lifted by a rally in bonds. S&P 500 futures were
indicating a slightly higher open.
|
|
||||||||||||||||||||||||||
BP Plc's fourth quarter earnings came in below analyst expectations, with the
company saying that its cash flow won't cover spending and dividends until
Brent crude rises above $60 a barrel. Statoil ASA, Norway's biggest oil
company, said that it is targeting another $1 billion in cost savings after
reporting an unexpected loss in the fourth quarter. West Texas Intermediate
for March delivery was trading at $52.84 a barrel at 5:35 a.m. ET
ahead of tomorrow's U.S. crude stockpiles report.
China's
FX reserves fall below $3 trillion. China's foreign-exchange
reserves slumped to $2.998 trillion in January, hitting their lowest level in
almost six years, Reuters reports, citing People's Bank of China data.The IMF's annual review of Greece has concluded. The International Monetary Fund's annual review of Greece found that economic growth was likely to remain below 1% and that the debt-burdened country would most likely meet the preferred fiscal-surplus target of most IMF directors, Reuters says. Greece's two-year yield is higher by 75 basis points at 9.29%. The Reserve Bank of Australia thinks growth will pick up. Australia's central bank held its key interest rate unchanged at 1.50% on Tuesday and said, "A return to reasonable growth is expected in the December quarter." The Australian dollar is weaker by 0.6% at .7613 versus the dollar. The head of New Zealand's central bank won't seek a new term. Graeme Wheeler announced on Tuesday that he wouldn't seek a second five-year term when his term ends on September 26. "It was my intention, when I was appointed, to serve one term, and then to take on governance roles," Wheeler said in a statement released by the Reserve Bank of New Zealand. Apple pulled ahead of Samsung in smartphone shipments. Apple shipped 78.3 million units in the fourth quarter, surpassing Samsung for the first time in five years. Samsung shipped 77.5 million units, a number that was affected by its exploding-battery fiasco," which cost it $3 billion in lost sales. Fitbit is facing a criminal investigation. The wearable-device maker is being accused by its rival Jawbone of stealing trade secrets, Bloomberg reports. Teva Pharmaceutical's CEO steps down. Erez Vigodman announced on Monday that he was resigning effective immediately. He is being replaced on an interim basis by Yitzhak Peterburg, who has served as Teva's chairman of the board. BNP Paribas is planning a transformation. The French bank plans to invest 3 billion euros ($3.2 billion) over the next three years to "build the bank of the future by continuing to grow the businesses and implementing an ambitious program of digital transformation, new customer experience, and cost savings." Earnings reporting picks back up. General Motors and Michael Kors are among the names reporting ahead of the opening bell, while Buffalo Wild Wings, Walt Disney, and Yum China highlight the names releasing their quarterly results after markets close.
US economic data is moderate. The trade balance will be
released at 8:30 a.m. ET before Jolts Job Openings and consumer credit cross
the wires at 10 a.m. ET and 3 p.m. ET. The US 10-year yield is higher by 1
basis point at 2.42%.
Judges and the Border
The Trump administration, seeking to persuade an appeals court to reinstate its travel ban, argued the president has broad authority to decide who can and can’t enter the U.S. and that preventing him from doing so puts national security at risk. The administration’s filing to the Ninth U.S. Circuit Court of Appeals in San Francisco sets the stage for oral arguments Tuesday afternoon, after which a ruling could be made at any time. The Justice Department is asking the appeals court to reverse a restraining order issued by a Seattle judge last week that blocked enforcement of President Trump’s executive order on immigration and refugees. The case is the first major legal test of the Trump administration’s executive order-heavy agenda—one that could end up redefining how much power a president has in determining who can or can’t enter the country. Meanwhile, a legal filing from scores of U.S. technology companies opposing the immigration order has drawn a new line in the industry’s complicated relationship with the administration.
Tiger Tales
Stock picker Julian Robertson and his protégés have ruled the Wall Street jungle for decades. But a reversal in 2016 is challenging their dominion. For the year, hedge-fund losses at Tiger Global Management were roughly $900 million, marking a 15.3% loss. Lee Ainslie’s $11 billion Maverick Capital was down more than 10% in its flagship fund, while Viking Global Investors lost 4%. These “Tiger Cubs,” a generation of hedge-fund firms founded by traders who once worked for Mr. Robertson at his Tiger Management, are among a wave of stock hedge funds that fared poorly in 2016. “Bottom-up” stock pickers such as the Tiger Cubs were among the hardest hit. Last year’s markets were difficult for bottom-up investors because companies often didn’t rise or fall on their individual fundamentals.
European Central Bank President
Mario Draghi said that regulations enacted after the global financial crisis
have brought stability and that "the last thing we need" is
President Donald Trump's moves to weaken bank regulation in the US. "The
fact that we are not seeing the development of significant financial
stability risk is the reward of the action that legislators and regulators
and supervisors have been undertaking since the crisis erupted," Draghi
said. Deutsche Welle (Germany)/Agence France-Presse/Deutsche
Presse-Agentur/Reuters (06 Feb.), Bloomberg (06 Feb.)
|
posted by Rich Barnett @ 7:44 AM
0 Comments:
Post a Comment
<< Home