Good morning. Happy Friday.
The Asian/Pacific markets closed mostly up. Japan, China, Hong Kong, New Zealand, Malaysia and the Philippines did great. Europe, Africa and the Middle East are currently posting solid gains. The UK, Denmark, France, Germany, Russia, South Africa, Finland, Switzerland, Norway, Spin, Italy, Israel and Sweden are all doing very well. Futures in the States point towards another moderate gap up for the cash market.
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FREE Online Course: Jason Leavitt’s Mini Masterclass in Trading
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The dollar is up. Oil and copper are up. Gold and silver are up. Bonds are down.
Stories/News from Seeking Alpha…
A bruising trade war with the U.S. and sputtering investment saw China’s GDP growth expand by 6.1% last year, as a slowdown rippled through many sectors of the economy. While that was the lowest level in nearly three decades, the figure met expectations, falling within the government’s target of 6% to 6.5% for 2019. Trade deal help… Beijing is counting on improving consumer confidence and consumption to play a major role in boosting growth this year, according to Ning Jizhe, China’s chief statistician.
Alphabet enters four comma club
Despite heightened regulatory scrutiny, Big Tech is bigger than ever before. Alphabet (GOOG, GOOGL) became the fourth U.S. technology company to reach the $1T market cap level on Thursday, following Apple (NASDAQ:AAPL), Microsoft (NASDAQ:MSFT) and Amazon (NASDAQ:AMZN), which has since slipped back to about $930B. FAAAM is replacing FAANG? Adding Facebook (NASDAQ:FB) into the group, the five most valuable U.S. tech companies are now worth a massive $5.2T, accounting for over 17% of the S&P 500.
Microsoft will erase carbon footprint
Microsoft (MSFT) has thrown down the climate change gauntlet to its big corporate rivals with plans to launch a $1B fund encouraging the development of new carbon reduction and removal technologies. The company pledges to be carbon negative by 2030, and by 2050 will remove enough carbon to make up for the emissions and electrical consumption since Microsoft’s founding in 1975. “If the last decade has taught us anything, it’s that technology built without these principles can do more harm than good,” CEO Satya Nadella said at a media event.
Peacock video service fans its feathers
Coming a bit late to the streaming wars, NBCUniversal’s (NASDAQ:CMCSA) new Peacock service will support multiple tiers, including free, ad-supported ($5/month) and advertising-free ($10/month). The Premium tier will have about 15,000 hours of programming including originals, NBC broadcasts series and key reruns, while the lower tier will have about half as much content. By 2024, NBCU expects to reach 30M-35M active accounts for the service, which will launch nationwide on July 15 (and on April 15 for Comcast customers).
Gap pulls plug on Old Navy spinoff
The board concluded that the cost and complexity of splitting into two companies, combined with softer business performance, limited the retailer’s ability to create “appropriate value” from the separation plan. Gap (NYSE:GPS) shares are up 5.5% premarket on the news, which also saw the departure of Neil Fiske, president and CEO of the Gap brand. Looking ahead, the board intends to appoint a new CEO to oversee the full portfolio of brands and corporate strategy.
More record-setting
Fueled by soaring tech stocks and a solid start to earnings season, the S&P 500 crossed the 3,300 mark for the first time on Thursday, while other main U.S. indexes broke record highs. Sentiment was further lifted by data that showed U.S. retail sales rose 0.3% in December, indicating the U.S. economy maintained a moderate growth pace at the end of 2019. More record highs are in store today as U.S. stock futures point to gains of 0.3% before another round of economic stats that include consumer sentiment figures and the latest JOLTS.
Trump nominates two to Fed board
Christopher Waller, director of research at the St. Louis Fed, will probably hold views on the board similar to his current boss Jim Bullard. The latter was a strong proponent last year of an “insurance cut” to help businesses worried by trade uncertainty, and was in favor of even steeper cuts in September. The nomination of Judy Shelton, an adviser to the Trump campaign in 2016 and recent U.S. director of the EBRD, is more controversial. She has a long history of unorthodox economic commentary like questioning the basic role of the Fed and advocated pegging the dollar to the gold standard.
20-year bond coming soon
The U.S. government will begin issuing 20-year bonds in the first half of 2020, as budget analysts expect years of continued growth in federal budget deficits. “We seek to finance the government at the least possible cost to taxpayers over time, and we will continue to evaluate other potential new products to meet that goal,” Treasury Secretary Steven Mnuchin declared. Offering a 20-year bond would be a reintroduction of a security last issued in March 1986.
USMCA clears the Senate
The trade agreement will now head to President Trump’s desk – more than 14 months after the three countries agreed to the deal – and will take effect once Canada ratifies the accord. The pact opens Canadian dairy markets to American producers, implements stricter rules for auto part rules of origin, and updates digital trade and copyright rules, among others. Industry groups have hailed the trade deal and said it would provide sorely needed certainty to revive investment flows.
Trade deal challenges?
The “Phase One” U.S.-China trade agreement could violate WTO rules, according to EU Trade Commissioner Phil Hogan, whose team will “analyze the document in detail.” At issue is whether China’s pledge to increase purchases of U.S. goods and services by at least $200B over the next two years is WTO-compatible. “We’re not trigger-happy about taking cases to the WTO – we don’t want to create that impression. But we’ll stand up for our own economic interests.”
What else is happening…
Facebook (FB) scraps plan to sell ads in WhatsApp.
McAfee hires new CEO… IPO on tap?
Videogame sales finish year with 15% drop in December.
Eli Lilly (NYSE:LLY) targets buying spree in 2020.
Fiat Chrysler (NYSE:FCAU), Foxconn (OTC:FXCOF) team up for EVs.
Starbucks (NASDAQ:SBUX) expands presence in low-income areas.
Bombardier (OTCQX:BDRAF) suffers deep fall after guidance slashed.
Thursday’s Key Earnings
BNY Mellon (NYSE:BK) -7.8% on expense concerns.
Charles Schwab (NYSE:SCHW) +4% as assets swelled to $4T.
CSX (NASDAQ:CSX) -3.4% AH seeing revenue challenges in 2020.
Morgan Stanley (NYSE:MS) +6.6% topping off a record year.
PPG Industries -2.6% (NYSE:PPG) on Q4 miss, weak guidance.
Taiwan Semiconductor (NYSE:TSM) +0.4% reporting profit growth.
Today’s Economic Calendar
8:30 Housing Starts
9:00 Fed’s Harker: Economic Outlook
9:15 Industrial Production
10:00 Consumer Sentiment
10:00 Job Openings and Labor Turnover Survey
12:45 PM Fed’s Quarles Speech
1:00 PM Baker-Hughes Rig Count
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Good morning. Happy Thursday.
The Asian/Pacific markets leaned to the upside. Hong Kong, South Korea, New Zealand, Australia, Singapore and Thailand posted gains; China was weak. Europe, Africa and the Middle East are currently mixed and little changed. Turkey, Russia, Finland and Sweden are up; the UK and Greece are down. Futures in the States point towards a moderate gap up open for the cash market.
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FREE Online Course: Jason Leavitt’s Mini Masterclass in Trading
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The dollar is down. Oil is flat; copper is up. Gold and silver are up. Bonds are up.
Stories/News from Seeking Alpha…
Wall Street will be looking for more record highs during today’s session, as Dow futures point to a 75-point advance after closing above 29,000 for the first time on Wednesday. Investors are reacting to details of the U.S.-China “Phase One” trade agreement, a first step in ending an 18-month trade war between the world’s two largest economies. President Trump said the deal restored “economic justice” as China committed to $200B in additional purchases of U.S. goods and pledged to “enhance” intellectual property protections. All U.S. tariffs on Chinese imports will be removed as soon as the two countries complete a “Phase Two” trade pact.
Risks to oil supply have receded – IEA
“Today’s market, where non-OPEC production is rising strongly and OECD stocks are 9M barrels above the five-year average, provides a solid base from which to react to any escalation in geopolitical tension,” the IEA said in its monthly report. “Even if they (OPEC+) adhere strictly to the cuts, there is still likely to be a strong build in inventories during the first half of 2020,” the agency declared, adding that recently signed trade deals should “support growth.”
LIBOR no more
The Bank of England and Financial Conduct Authority are demanding to see “clear evidence of engagement” from firms to make sure they move away from scandal-tainted LIBOR by next year. The shift is proving tricky as the rate underpins $350T of financial products around the world, though regulators are pushing alternatives like SONIA. The BOE is “keeping the potential use of supervisory tools under review” if banks and insurers do not comply, meaning senior managers could be in the line of fire or capital ratios could be jacked up.
Europe falls down U.S. priority list
Brexit should be a “wake-up call” for the European Union, German Chancellor Angela Merkel warned in a rare interview with the FT. “I see the European Union as our life insurance. Germany is far too small to exert geopolitical influence on its own, and that’s why we need to make use of all the benefits of the single market,” she added. “President Obama already spoke about the Asian century, as seen from the U.S. perspective. This also means that Europe is no longer, so to say, at the center of world events… that will be the case under any president.”
Faltering DVDs lead to new partnership
Once a bedrock of the movie business, Comcast’s (NASDAQ:CMCSA) Universal Pictures and AT&T’s (NYSE:T) Warner Bros. are planning to form a joint venture tasked with distributing DVDs and Blu-ray discs in the U.S. and Canada. If approved, the joint venture would likely help Universal and Warner trim costs as both companies prepare to launch their own streaming services. Last year digital sales in the U.S., which includes streaming and downloads, rose to $20.4B, compared to the just $3.3B Americans spent on all packaged home-entertainment products.
Vaporfly may face World Athletics ban
Shares in Asics (OTCPK:ASCCY) surged as much as 8% in Tokyo overnight after several reports suggested that World Athletics was mulling a ban for Nike’s (NYSE:NKE) Vaporfly shoes in professional competition. The sneaker has come under scrutiny amid claims that its foam and carbon fiber sole plate serves as a spring that gives runners an extra edge. Five of the fastest marathon times on record have been recorded by Vaporfly-wearing athletes over the past 18 months.
Pepsi bets on Zero in Super Bowl
Talk about marketing… PepsiCo (NASDAQ:PEP) will give everyone in the U.S. a free Pepsi Zero Sugar (via refund) if the final score of either of this year’s Super Bowl teams ends in a zero. “We are going ‘all in’ on Pepsi Zero Sugar this year and have created a bold, unapologetic new look to match its great taste, with a new matte black can and a black tab that will stand out anywhere,” said Todd Kaplan, Pepsi’s VP of Marketing. In 25% of previous Super Bowl games, at least one team finished with a score ending in zero.
Spending big on recycled plastic
Vowing to make 100% of its packaging recyclable or reusable by 2025, Nestle (OTCPK:NSRGY) is investing as much as 2B Swiss francs to source more recycled plastics to package its products. It will also try to keep the plastic purchasing neutral on earnings through efficiencies. Rival Unilever (NYSE:UN) has further pledged to halve its use of newly made plastic by 2025 as food and beverage makers increasingly come under fire for polluting oceans and landfills.
Flying taxis
Toyota (NYSE:TM) is the lead investor in a Series C funding round of Joby Aviation, a startup aimed at delivering safe and affordable public air travel while advancing the transition to sustainable transportation. The company already has a prototype with six electric propellers and is capable of flying 150 miles on a single charge, at speeds of up to 200 miles per hour. “Air transportation has been a long-term goal for Toyota, and while we continue our work in the automobile business, this agreement sets our sights to the sky,” said CEO Akio Toyoda.
EU backs taxi app Bolt to rival Uber
Competition between the two companies already heated up in Europe after Uber (NYSE:UBER) was blocked from operating in London by local transport regulators. Now, Bolt has secured €50M in debt financing from the lending arm of the EU, the European Investment Bank, to invest in ride hailing and food delivery. EIB Vice President Alexander Stubb called Bolt a “good example of European excellence in tech and innovation,” while Bolt CEO Markus Villig said the loan “enables us to move faster towards serving many more people in Europe.”
What else is happening…
Target (NYSE:TGT) holiday sales miss forecasts.
Smith & Wesson parent, American Outdoor (NASDAQ:AOBC), replaces CEO.
Ruble falls as Putin calls for constitutional revamp.
Apple (NASDAQ:AAPL) reportedly sold nearly 60M AirPods last year.
FAA weighs in on Delta Air Lines (NYSE:DAL) fuel dump.
Juul (JUUL) keeps scaling back overseas expansion.
New Tesla (NASDAQ:TSLA) registrations nearly halve in California.
Wednesday’s Key Earnings
Alcoa (NYSE:AA) -3% AH seeing 2020 global aluminum surplus.
Bank of America (NYSE:BAC) -1.9% growing loans and deposits.
BlackRock (NYSE:BLK) +2.3% as assets blew past $7T.
Goldman Sachs (NYSE:GS) -0.2% after expenses increased for 1MDB scandal.
PNC Financial (NYSE:PNC) -3.6% revealing escalating costs.
U.S. Bancorp (NYSE:USB) missing estimates.
UnitedHealth (NYSE:UNH) +2.8% amid improving margins.
Today’s Economic Calendar
8:30 Initial Jobless Claims
8:30 Philly Fed Business Outlook
8:30 Retail Sales
8:30 Import/Export Prices
10:00 Business Inventories
10:00 NAHB Housing Market Index
10:00 Fed’s Bowman Speech
10:30 EIA Natural Gas Inventory
4:00 PM Treasury International Capital
4:30 PM Money Supply
4:30 PM Fed Balance Sheet
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Good morning. Happy Wednesday.
The Asian/Pacific markets closed mostly down. China, Japan, Hong Kong, South Korea, Taiwan, Australia, Indonesia, Thailand and the Philippines closed down; New Zealand did well. Europe, Africa and the Middle East currently lean down. Denmark, Greece and Israel are up, but Poland, South Africa, Finland, Hungary, Spain, Italy, Austria, Sweden and Saudi Arabia are down. Futures in the States point towards a positive open for the cash market.
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FREE Online Course: Jason Leavitt’s Mini Masterclass in Trading
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The dollar is down slightly. Oil is flat; copper is down. Gold and silver are up. Bonds are up.
Stories/News from Seeking Alpha…
Despite the signing of a “Phase One” trade deal this morning, it looks like some tensions between the U.S. and China will persist, triggering stocks to dip across the globe overnight. Existing tariffs on Chinese imports will remain until the completion of a second phase trade agreement, meaning the duties are likely to stay in place until after the American presidential election in November. The period of review is intended to give the Trump administration time to verify China’s adherence to the terms of the pact, which will likely require Beijing to buy at least $200B of goods and services over two years, and to go beyond prior commitments made on IP and technology theft.
Day 2 of earnings season
Get ready for another slew of bank results. Scheduled to report today are Bank of America (NYSE:BAC), Goldman Sachs (NYSE:GS), U.S. Bancorp (NYSE:USB) and PNC Financial (NYSE:PNC). A healthy U.S. economy pushed up Q4 profits at JPMorgan (NYSE:JPM) (+21% to $8.52B) and Citigroup (NYSE:C) (+15% to $4.98B) on Tuesday – allowing them to grow even despite falling interest rates – while escalating expenses and costs weighed on Wells Fargo (NYSE:WFC).
Repo interventions continue
Although the year-end cash squeeze passed without any jump in borrowing costs, the New York Fed plans to maintain its interventions in short-term funding markets at an elevated level. On Tuesday, banks gobbled up $82B in temporary liquidity in the form of overnight and two-week repo loans. “History has shown us that whenever these sorts of programs are introduced, they tend to last longer than what the Fed expects,” said Nick Maroutsos, co-head of global bonds at Janus Henderson, comparing the case to the unwinding of QE.
Boeing hands over planemaker crown
Boeing (NYSE:BA) has officially lost the title of world’s largest planemaker as the 737 MAX grounding sent the company to its biggest defeat in its decades-long duel with Airbus (OTCPK:EADSY). Deliveries tumbled to just 380 jetliners last year, less than half of Airbus’s tally of 863 planes. It also posted negative orders for the first time in at least 30 years, losing orders for 87 commercial airplanes for all of 2019, compared with the 768 orders of its French rival.
Amazon lifts ban on FedEx Ground
Weeks after the Christmas rush, Amazon (NASDAQ:AMZN) is saying FedEx (NYSE:FDX) service levels have improved. The retail giant will now allow its third-party merchants to once again use FedEx’s Ground network to ship orders placed under Amazon’s Prime membership program. Amazon instituted the ban in mid-December due to slipping on-time marks for Prime orders, which generally are guaranteed to arrive within a day or two.
Media access to market data
The Trump administration plans to restrict the news media’s ability to prepare advance stories on sensitive U.S. economic data such as inflation and employment, Bloomberg reports. “Lockups” lasting 30 to 60 minutes are currently hosted in Washington for major reports, where journalists receive data in a secure room and transmit them when connections are restored at release time. The change, which could remove computers from the lockup room, would transform how critical market-moving information is distributed to investors and the public.
Reining in Huawei dominance
A bipartisan group of U.S. senators is proposing the Utilizing Strategic Allied Telecommunications Act, which would steer more than $1B toward companies developing 5G to counter advances from China’s Huawei. The money would come from auctions of wireless-spectrum licenses by the FCC, as well as a Multilateral Telecommunications Security Fund. A draft version of the law didn’t name specific companies, but Huawei’s closest rivals in the cellular radio market are Ericsson (NASDAQ:ERIC) and Nokia (NYSE:NOK).
Bezos offers an olive branch
The 21st century is “going to be the Indian century,” Jeff Bezos said at a company event in New Delhi, amid local criticism from small business owners over unfair business practices. He also detailed plans for Amazon (AMZN) to invest $1B in digitizing small- and medium-sized businesses in India and expects to export $10B worth of India-made goods by 2025. The industry alleges Amazon is driving them out of business by offering sharply discounted products and favoring select big sellers on its platform.
Worrying sign for the eurozone?
Germany’s GDP growth expanded at just 0.6% in 2019, ending a year in which manufacturing took a battering and the country almost tipped into recession. The troubles are far from over as the domestic car industry faces a critical period as they push sales of electric vehicles, while manufacturers are under pressure to adapt to climate change standards. Trade tensions and continued risk of a disruptive Brexit are also weighing on sentiment and momentum.
More trade talk
Senate Majority Leader Mitch McConnell expects his chamber to approve the USMCA trade deal this week after the House passed it last month. The U.S. has also cleared procedural hurdles to slap levies on $2.4B of French goods over a digital tax the country has adopted, but will hold off as Paris and Washington try to resolve the issue by next week when they meet on the sidelines of the World Economic Forum in Davos.
What else is happening…
Another wild ride for Beyond Meat (NASDAQ:BYND).
PG&E (NYSE:PCG) nears deal on restructuring plan.
TC Energy (NYSE:TRP) to resume work on Keystone XL.
Juul (JUUL) halts fruit-flavored pod sales in Canada.
Microsoft (NASDAQ:MSFT) patches major Windows security flaw.
Tuesday’s Key Earnings
Citigroup (C) +1.6% gaining in consumer, i-banking units.
Delta Air Lines (NYSE:DAL) +3.3% following an earnings topper.
JPMorgan (JPM) +1.2% impressing on NII, trading revenue.
Wells Fargo (WFC) -5.4% on escalating expenses, weak fee income.
Today’s Economic Calendar
7:00 MBA Mortgage Applications
8:30 Producer Price Index
8:30 Empire State Mfg Survey
10:00 Atlanta Fed’s Business Inflation Expectations
10:30 EIA Petroleum Inventories
11:00 Fed’s Harker: “Monetary Policy Normalization: Low Interest Rates and the New Normal”
12:00 PM Fed’s Kaplan Speech
2:00 PM Fed’s Beige Book
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Good morning. Happy Tuesday.
The Asian/Pacific markets leaned to the upside. Japan, South Korea, New Zealand, Taiwan, Australia, Indonesia and Singapore did well; China and Hong Kong were weak. Europe, Africa and the Middle East are currently mixed and little changed. Turkey, the UAE and Saudi Arabia are up; Poland, Russia and Spain are down. Futures in the States point towards a flat open for the cash market.
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REPORT: LB Weekly – our complete weekly report for subscribers
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The dollar is up. Oil is down; copper is up. Gold and silver are down. Bonds are down slightly.
Stories/News from Seeking Alpha…
Earnings reports start flowing today from big U.S. banks, with results from Citigroup (NYSE:C), JPMorgan (NYSE:JPM) and Wells Fargo (NYSE:WFC) kicking off the fourth-quarter earnings season. Futures are holding their breath ahead of the releases, pointing to a flat open. On watch are the banks’ net interest income in a lower interest rate environment, and strategic initiatives to cut costs and grow consumer deposits. The figures and outlooks will also be closely examined by investors looking to gauge the health of the U.S. economy.
Manipulator no more
The Trump administration has officially lifted its designation of China as a currency manipulator, more than five months after the country was added to the list. The nation has made “enforceable commitments” not to devalue the yuan and has agreed to publish exchange rate information, Treasury Secretary Steven Mnuchin said ahead of the scheduled signing of a “Phase One” trade deal on Wednesday. The yuan strengthened to its strongest level since July in offshore trading on the news, punching past 6.9 per dollar.
Climate change action
In an effort to position itself as a leader in sustainable investing, BlackRock (NYSE:BLK) has unveiled sweeping changes that will double the number of sustainability-focused ETFs it offers to 150. The world’s largest fund manager will also cut companies that derive a quarter or more of their profits from thermal coal from its actively managed portfolios, and assess environmental, social and governance (ESG) “with the same rigor as traditional measures such as liquidity and credit risk.” The moves will go a long way toward BlackRock’s goal of increasing its sustainable assets ten-fold from $90B today to $1T within a decade.
Budget deficit problem
According to the latest figures from the Treasury Department, the U.S. fiscal deficit exceeded $1T in 2019, marking the first time it has passed that level in a calendar year since 2012. The future is not looking better. For the fiscal year, which began in October, the shortfall is already at $356.6B, an 11.7% increase from a year ago. As deficits have swelled, so has the national debt, which now stands at $23.2T.
Big Tech domination
The recent Big Tech surge is good news for anyone chasing the sector higher, but several strategists highlight it’s a sign investors have lost their risk appetite. The top five publicly traded American companies – Apple (NASDAQ:AAPL), Microsoft (NASDAQ:MSFT), Alphabet (GOOG, GOOGL), Amazon (NASDAQ:AMZN) and Facebook (NASDAQ:FB) – now make up a record 18% share of the S&P 500 Index’s capitalization. That ratio is higher than the tech bubble, according to Morgan Stanley, amid fears the economic cycle will slow.
Netflix leads Oscar nominations
Netflix (NASDAQ:NFLX) rallied 3% on Monday after leading Oscar nominations with 24 nods – a first for a streaming service. Disney (NYSE:DIS), meanwhile, scored 23 nominations and Sony (NYSE:SNE) had 20, while Warner Bros. (NYSE:T) earned the distinction of having the most-nominated film of the year with Joker bagging 11 nominations. Nominations doesn’t mean the studio will come home with the most trophies. In December, Netflix garnered the most Golden Globe nominations (17) but only won two awards.
Dealmaking in the fintech space
Visa (NYSE:V) is shelling out $5.3B to buy privately held software startup Plaid, whose technology lets people link their bank accounts to mobile apps like Venmo, Acorns and Chime. Consumers have increasingly been using financial services apps to manage their savings and spending, and Plaid sits in the middle of those relationships. The $5.3B price tag is double what Plaid was reportedly valued at during its last fundraising, when it took a $250M Series C round that was announced in December 2018.
Options on bitcoin futures
Options on exchange-traded bitcoin futures launched Monday on the Chicago Mercantile Exchange, in response to growing crypto attraction and demand for tools to manage bitcoin (BTC-USD) exposure. While volumes and open interest on a rival exchange known as Bakkt have been “rather small,” the new offering could be a game changer, said strategists at JPMorgan led by Nikolaos Panigirtzoglou. “The first day of trading might be irrelevant – the first weeks and months might be more material,” added Mike McGlone, an analyst with Bloomberg Intelligence.
Robot army
Walmart (NYSE:WMT) will add shelf-scanning robots to 650 more U.S. stores by the end of the summer, bringing its fleet to 1,000. The six-foot-tall Bossa Nova devices, equipped with 15 cameras each, can reduce tasks that once took as long as two weeks into a twice-daily routine. The world’s largest retailer’s increasingly automated workforce already includes bots that scrub floors, unload trucks and gather online grocery orders.
Apple vs. FBI – Round 2
U.S. Attorney General William Barr has called on Apple (AAPL) to help the FBI unlock two iPhones used by Mohammed Saeed Alshamrani, who is suspected of killing three people last month in a shooting at a Navy base in Pensacola, Florida. “So far Apple has not given us any substantive assistance,” he declared, though the tech giant rejected the characterization. In 2016, the FBI cracked the iPhone of one of San Bernardino shooters via a third party, after Apple refused to break into the iPhone and called the demand “dangerous, unprecedented and chilling.”
What else is happening…
Amazon (AMZN) seeks to block JEDI work by Microsoft (MSFT).
Tesla (NASDAQ:TSLA) tops $500, leaving analysts to play catch-up.
Renault (OTCPK:RNLSY), Nissan (OTCPK:NSANY) shoot down breakup rumors.
‘Old Sears’ (OTCPK:SHLDQ) settles differences with ‘New Sears.’
Oklahoma sues over ‘major oversupply of opioids.’
Cloudera (NYSE:CLDR) appoints Hortonworks founder as CEO.
GameStop (NYSE:GME) -10% premarket as sales continue to disappear.
Spirit AeroSystems (NYSE:SPR) hit with Moody’s debt downgrade.
Today’s Economic Calendar
6:00 NFIB Small Business Optimism Index
8:30 Consumer Price Index
8:55 Redbook Chain Store Sales
9:00 Fed’s Williams Speech
1:00 PM Fed’s George: Economic Outlook and Monetary Policy
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Good morning. Happy Monday. Hope you had a great weekend.
The Asian/Pacfic markets closed mostly up. Japan, China, Hong Kong, South Korea, India and Taiwan led while Malaysia closed down. Europe, Africa and the Middle East currently lean to the upside. The UK, Denmark, Poland, Turkey, the UAE and Saudi Arabia are doing well; Greece is weak. Futures in the States point towards a moderate gap up open for the cash market.
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REPORT: LB Weekly – our complete weekly report for subscribers
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The dollar is up. Oil and copper are up. Gold and silver are down. Bonds are down.
Stories/News from Seeking Alpha…
After briefly topping the 29,000 milestone on Friday, the Dow looks set to firmly regain the level today as futures start the week with a 125-point advance. The blue-chip market benchmark has now racked up 10,676 points since election day 2016 as the historic bull market tears higher in the new year. More movement will likely be seen during the week. Earnings season kicks off with major Wall Street banks, while investors will get details of the “Phase One” trade agreement with China.
Iran admits to shooting down jetliner
For days, Iran’s government had denied responsibility for the crash of a Boeing (NYSE:BA) 737-800 near Tehran, though it’s now calling the incident that killed 176 people a “disastrous mistake.” The country’s air defenses were fired in error while on alert after Iranian missile strikes targeted U.S. bases in Iraq. Local officials had previously pointed to an engine failure as the cause of the crash. The plane’s turbines were made by CFM International, a joint venture between General Electric (NYSE:GE) and France’s Safran (OTCPK:SAFRY).
MAX crisis will weigh on U.S. growth
“There’s no question that the Boeing (BA) situation is going to slow down the GDP numbers,” according to Treasury Secretary Steven Mnuchin. “Boeing is one of the largest exporters, and with the 737 MAX, I think that could impact GDP as much as 50 basis points this year… For this year, we’ve been looking at 2.5 to 3%, as I said, it may be closer to 2.5 because of the adjustment of the Boeing numbers.”
Biggest IPO ever gets bigger
Saudi Aramco (ARMCO) has exercised its “greenshoe option” to sell an additional 450M shares, raising the size of its initial public offering to a record $29.4B. “No additional shares are being offered into the market today and the stabilizing manager will not hold any shares in the company as a result of exercise of the over-allotment option,” Aramco said on Sunday. The oil giant initially raised a then-record $25.6B in its IPO in December by selling 3B shares at 32 riyals ($8.53).
Shakeup at Walmart India
Facing challenges in expanding its wholesale business in India, Walmart (NYSE:WMT) is restructuring in the country as it focuses more on retail and business e-commerce. Eight of the 56 executives fired were in “senior management” roles and the rest from middle or lower management. “We are also looking for ways to operate more efficiently, which requires us to review our corporate structure to ensure that we are organized in the right way,” Walmart India CEO Krish Iyer said in a statement.
Cue the Nextel flashbacks
Samsung Electronics (OTC:SSNLF) and Microsoft (NASDAQ:MSFT) are bringing back Push to Talk technology with the Galaxy XCover Pro. The smartphone features a button that initiates a chat using Microsoft’s Teams app and is being marketed to firstline workers. “It reduces licensing and provisioning costs, and it’s one less device for the employee to carry,” said Emma Williams, Microsoft’s corporate vice president for Office verticals.
Pushing iPhone recycling
Apple (NASDAQ:AAPL) is planning to become a “closed-loop” manufacturer that does not rely on the mining industry and is going some of the way with its “Daisy” robot. The device breaks apart 200 old iPhones per hour so that 14 minerals, including lithium, can be extracted and recycled. With the rising popularity of electric vehicles, newly mined minerals will be needed on an even larger scale, and Apple still recognizes that reality. “We’re not necessarily competing with the folks who mine,” said Lisa Jackson, the company’s head of environment, policy and social. “There’s nothing for miners to fear in this development.”
‘1917’ powers to No. 1
Scoring best dramatic picture win at the Golden Globes, 1917 dominated the box office during its opening weekend with a $36.5M haul in North America. That was strong enough to dethrone the latest Star Wars (NYSE:DIS) movie, which had ruled atop the box office for three consecutive weeks. Until this weekend, 1917 – distributed by Comcast’s (NASDAQ:CMCSA) Universal Pictures – had only been available in a select number of theaters nationwide.
Nissan accelerates potential split from Renault
Top brass at Nissan (OTCPK:NSANY) are talking about a secret contingency plan to potentially split from Renault (OTCPK:RNLSY), which has been ramped up since Carlos Ghosn’s dramatic escape from Japan last month, FT reports. Several sources said the plan includes a total divide between the companies in engineering and manufacturing, as well as changes to Nissan’s board. A split would leave the companies smaller, likely prompting them to find new partners amid industry-wide consolidation.
Sterling falls below $1.30
Gertjan Vlieghe, an external monetary policy committee member, is the latest to signal he would vote for a BOE interest rate cut later this month if data doesn’t show the U.K. economy is picking up. Another external MPC member, Silvana Tenreyro, signaled similar sentiment on Friday, while Bank of England Governor Mark Carney floated the idea of lower rates last week. Sterling fell 0.6% to $1.2975 on the news, leaving it nearly 2% lower since the start of the year.
What else is happening…
Europe stands by Iran nuclear deal.
Occidental’s (NYSE:OXY) not-so-costless oil-price hedge.
Woodward (NASDAQ:WWD), Hexcel (NYSE:HXL) combine in $6.4B merger.
No severance, but ex-Boeing (BA) CEO walks away with $62M.
Israel grounds Tesla’s (NASDAQ:TSLA) Autopilot – Calcalist.
Ford’s (NYSE:F) China vehicle sales plunge 26% in 2019.
Amazon (NASDAQ:AMZN) fires more employees for customer data leaks.
Today’s Economic Calendar
10:00 Fed’s Rosengren Speech
12:40 PM Fed’s Bostic: Monetary Policy and Economic Outlook
2:00 PM Treasury Budget