{"id":13954,"date":"2020-04-13T13:03:58","date_gmt":"2020-04-13T13:03:58","guid":{"rendered":"http:\/\/blog.leavittbrothers.com\/?p=13954"},"modified":"2020-04-20T16:21:55","modified_gmt":"2020-04-20T16:21:55","slug":"before-the-open-apr-13-17","status":"publish","type":"post","link":"https:\/\/blog.leavittbrothers.com\/?p=13954","title":{"rendered":"Before the Open (Apr 13-17)"},"content":{"rendered":"\n Good morning. Happy Friday. <\/span>

\n\n The Asian\/Pacific<\/strong> markets posted solid gains. Japan, Hong Kong, South Korea, India, New Zealand, Taiwan, Australia, Malaysia, Indonesia, Thailand and the Philippines were all up big. Europe, Africa and the Middle East<\/strong> are also posting solid gains. The UK, France, and Germany are up more than 3%; South Africa, Finland, Switzerland, Norway, Spain, the Netherlands, Italy, Austria and Sweden are up more than 2%. Futures in the States<\/strong> point towards a big gap up open for the cash market. <\/span>

\n\n—————\nVIDEO: State of the Market<\/a> <\/span>\n—————<\/span>

\n\n The dollar is down. Oil is down; copper is up. Gold and silver are down. Bonds are down. <\/span>

\n\n Stories\/News from Seeking Alpha…<\/span>

\n\nU.S. stock futures jumped Thursday evening after President Trump announced plans to reopen the U.S. economy, triggering big overnight gains across the globe. The federal guidelines detail three specific “phases” (strict social distancing, limited gatherings, identification and isolation), but aim at easing restrictions in locations with low COVID-19 transmission and holding the line in harder-hit areas. As many as 29 states could open up relatively quickly, according to Trump, though governors of both parties made clear they will move at their own pace.

\n\nMore positive news

\n\nThere were several other catalysts for the surge upwards, including hopeful buzz from a study on Gilead Sciences’ (NASDAQ:GILD) remdesivir in severely ill COVID-19 patients. Boeing (NYSE:BA) also announced the resumption of airline production with about 27K workers at its Puget Sound-region facilities next week and Uber (NYSE:UBER) disclosed Q1 and Q2 charges that perhaps weren’t as bad as feared. The Mayor of Jacksonville, FL, further announced the partial reopening of beaches as of 5 PM ET on Friday.

\n\nChina suffers historic economic slump

\n\nBeijing is likely to cut its benchmark lending rate on Monday – for the second time this year – after its economy shrank 6.8% in the first quarter due to the coronavirus epidemic. That’s the first contraction since at least 1992 when the government began publishing quarterly records. Business activity in China has returned to roughly 83% of capacity, up from 70% about a month ago, and many expect the economy will grow 2.0% for the full year.

\n\nNo deal

\n\nA fight over small business funding will carry into next week after the Senate adjourned late Thursday without an agreement. At issue: Republicans want another $250B for loans before moving on to other aid and stimulus proposals, while Democrats want to include cash for hospitals, state and local governments, and food assistance. Without additional funding, banks and the SBA will be unable to approve more of the PPP loans designed to avert layoffs. $349B was initially allocated to the program, but that ran out yesterday, just two weeks after applications for the program opened.

\n\nFed and Treasury share the risk

\n\nMany are highlighting the unusual partnership outlined in the CARES Act, which will allow the U.S. Treasury to pool $454B together with the Fed’s lending facilities to create $4T in loans aimed at helping businesses, states and local governments. If losses in the borrowing vehicles turn out to be larger than the amount Treasury has put in, the department will take the first hit, and the Fed will end up paying less money at the end of the year. While many see the program as another loss to the central bank’s independence, the two entities are “closely joined at the hip in the crisis,” said New York Life’s Steven Friedman. “As they should be.”

\n\nEuropean car sales drop most on record

\n\nNew car sales across the EU plunged 55.1% to 567,308 vehicles in March as large portions of the bloc’s economy went into lockdown. Volkswagen’s (OTCPK:VWAGY) sales decreased by 43.6%, while Renault (OTCPK:RNLSY) and PSA Group (OTCPK:PEUGF) posted a drop of 63.7% and 66.9%, respectively. Sales of cars made by BMW (OTCPK:BMWYY) slipped by 39.7%, while demand for rival Daimler (OTCPK:DDAIF) declined by 40.6%. New car sales in the U.S. fell 37.9% to 992,400 vehicles last month, according to WardsAuto.

\n\nSelf-driving efforts shift to delivery

\n\nAs demand for online orders surge, Toyota-backed (NYSE:TM) self-driving company Pony.ai is teaming with e-commerce site Yamibuy to deliver packages and groceries in the city of Irvine, California. Deliveries will go directly to customers’ doorsteps via a safety driver, or customers can choose to collect packages from the trunk of the car. Pony.ai operates a fleet of 10 modified Hyundai (OTCPK:HYMLF) Kona electric vehicles, which had been used as a robotaxi service in Irvine and Fremont.

\n\nCarnival defends safety record

\n\n“We followed protocol,” responds Carnival (NYSE:CCL) CEO Arnold Donald, after a Bloomberg Businessweek article accused execs of allowing partying to continue on ships amid the risk of coronavirus. Outbreaks occurred aboard the Diamond Princess and Grand Princess in February, ultimately leading to 815 passenger infections and 15 deaths, though the CDC only issued a “no sail order” on March 14. Carnival will not receive funding from the CARES Act (because it’s incorporated outside the U.S.) and shares are down 77% since Jan. 1. There are no plans to re-incorporate elsewhere, according to Donald, who hopes to extend some existing debt in Germany, the U.K. and Italy.

\n\n‘Unconstitutional’

\n\nInsurers are rejecting claims from restaurants and other businesses hurt by the coronavirus crisis, viewing those claims as unwarranted, under the conditions of their policies. “Pandemic is very different. It has no bounds or time limit,” said Chubb (NYSE:CB) CEO Evan Greenberg. “You can’t just retroactively change a contract. That is plainly unconstitutional. The only one who could really take the infinite nature, financial nature, of that is the government.”

\n\nLowest level in two decades

\n\nWTI crude oil contracts for May delivery slumped 9% overnight to $18.03\/bbl after OPEC economists slashed their global demand forecasts and the Energy Department said domestic producers had boosted U.S. inventories by a record 19.2M barrels. Data also showed that Saudi Arabia’s oil exports to the U.S. skyrocketed in the last month, with shipments going from an average of 366,000 barrels per day in February to 829,540 bpd in March, a multiple of around 2.5. Brent and WTI contracts for June delivery are trading flat at about $27.84\/bbl and $25.53\/bbl, respectively.

\n\nWhat else is happening…

\n\nPlanet Fitness (NYSE:PLNT) soars as gyms may reopen in phase 1.

\n\nMcClatchy (NYSEMKT:MNI) gets takeover offer from hedge funds.

\n\nFacebook (NASDAQ:FB) cancels large gatherings through June 2021.

\n\nRoche (OTCQX:RHHBY) is making coronavirus antibody tests.

\n\nAmazon (NASDAQ:AMZN) aims to test all employees for COVID-19.

\n\nZoom Video (NASDAQ:ZM) enlists security heavyweights.

\n\nFinal approval for closed T-Mobile (NASDAQ:TMUS) merger.

\n\nFederal contract to make ventilators for GE, Ford (NYSE:F).

\n\nThursday’s Key Earnings<\/B>
\nAbbott Laboratories (NYSE:ABT) +5.6% reporting a strong quarter.
\nBlackRock (NYSE:BLK) +0.8% on $35B of net inflows in Q1.
\nBNY Mellon (NYSE:BK) +4.4% beating estimates despite credit provision.
\nMorgan Stanley (NYSE:MS) -0.1% hurt by MTM losses, asset declines.
\nRite Aid (NYSE:RAD) -21.1% AH amid wider-than-expected losses.
\nTaiwan Semiconductor (NYSE:TSM) +5.6% as profits nearly doubled.

\n\nToday’s Economic Calendar<\/B>
\n9:00 Fed’s Bullard: \u201cHealth, Monetary and Fiscal Policy Responses to COVID-19\u201d
\n10:00 Leading Indicators
\n1:00 PM Baker-Hughes Rig Count

\n\n—————————-

\n\n Good morning. Happy Thursday. <\/span>

\n\n The Asian\/Pacific<\/strong> markets leaned down. China, India and New Zealand posted gains. Indonesia, Thailand and the Philippines were very weak; Japan, Hong Kong, Taiwan and Australia also lost ground. Europe, Africa and the Middle East<\/strong> are currently mostly up. The UK, Denmark, Poland, France, Germany, Russia, South Africa, Switzerland, the Netherlands, Italy, Saudi Arabia and the Czech Republic are doing well; the UAE and Israel are down. Futures in the States<\/strong> point towards point towards a positive open for the cash market. <\/span>

\n\n—————\nVIDEO: State of the Market<\/a> <\/span>\n—————<\/span>

\n\n The dollar is up. Oil and copper are up. Gold and silver are up. Bonds are up. <\/span>

\n\n Stories\/News from Seeking Alpha…<\/span>

\n\nU.S. stock futures wavered between gains and losses of about 1% overnight as traders prepared for the newest measures aimed at restarting economic activity. President Trump will unveil the guidelines against a backdrop of soaring jobless claims, citing data which “suggests that nationwide we have passed the peak on new cases.” More than 16M Americans have already lost their jobs in the past month (about 10% of the U.S. workforce) and economists expect another 5M initial jobless claims to be reported today.

\n\nGetting back to business

\n\nExecutives told President Trump that his administration needed to dramatically increase the availability of coronavirus testing before the public would be confident enough to return to work, eat out or go shopping. The task force, known formally as the Great American Economic Revival Industry Groups, includes more than 200 business and political leaders, who have been divided into smaller groups based on their industry. The economic damage has already been devastating: U.S. retail sales plunged 8.7% in March, while manufacturing output slumped by the most in over 74 years.

\n\n$6 trillion

\n\nThe American government has committed more than $6T to arrest the economic downturn from the COVID-19 pandemic, with $2.35T in fiscal spending and $4T from the Federal Reserve. The figure represents more than a quarter of U.S. economic output, and will mean for the first time since WWII, the nation will owe more than its economy can produce in a given year. Despite the huge congressional stimulus, proportionate to GDP, it is the world’s 10th largest, behind Japan, Singapore and the Netherlands.

\n\nKeep it in the ground

\n\nThe Trump administration is considering paying U.S. oil producers to leave crude in the ground to help alleviate a glut that has caused prices to plummet and pushed some drillers into bankruptcy, Bloomberg reports. The plan, which would require billions of dollars in appropriations from Congress, could compensate companies for sitting on as much as 365M barrels worth of oil reserves and count it as part of the government’s emergency stockpile. Analysts expect storage tanks to fill by summer or even sooner, leaving producers with no place to store their crude and prompting production halts and industry layoffs.

\n\nWorries about food supply

\n\nSmithfield Foods (OTCPK:WHGLY), the world’s largest pork processor, is shuttering two U.S. plants that process bacon and ham, after closing a separate hog slaughterhouse because of a coronavirus outbreak among employees. “The closures are part of the domino effect underway in our industry,” said CEO Ken Sullivan. “For the security of our nation, I cannot understate how critical it is for our industry to continue to operate unabated.”

\n\nBank earnings

\n\nShares of Bank of America (NYSE:BAC) and Citigroup (NYSE:C) slipped yesterday as they joined JPMorgan (NYSE:JPM) and Wells Fargo (NYSE:WFC) in reporting a slump in Q1 profits. Quarterly profits also halved at Goldman Sachs (NYSE:GS), though its trading unit softened the blow. Top U.S. retail banks additionally said they would provide overdraft relief, so customers could reap the full benefits of the federal government’s cash stimulus program. Keep your eyes on more bank earnings today with results from Morgan Stanley (NYSE:MS), BlackRock (NYSE:BLK) and BNY Mellon (NYSE:BK).

\n\nRaising dividends?

\n\nWhile most of corporate America suspends shareholder returns to shore up liquidity, some are hiking dividends amid the coronavirus crisis. Take a few examples from the consumer and healthcare sector, which has seen demand rise dramatically as people and entities stockpile to tide over the recent lockdowns. Costco (NASDAQ:COST) is the latest to raise its quarterly dividend by about 8%, following Johnson & Johnson (NYSE:JNJ) and Procter & Gamble (NYSE:PG), which upped their quarterly dividends by about 6% each on Tuesday.

\n\nSocial-distancing wearables

\n\nFord (NYSE:F) is experimenting with wristbands that vibrate when employees come within six feet of each other as part of a broader array of new safety protocols. The devices could be deployed more widely once the carmaker reopens its idled manufacturing plants. Ford is also expected to subject all workers entering a facility to a thermal-imaging scan, will provide staff with masks and, in some cases, plastic face shields.

\n\nEssential Deliveries

\n\nLyft (NASDAQ:LYFT) is launching a new on-demand delivery service to provide essential goods – meals, groceries, cleaning supplies – for healthcare workers, government organizations and non-profits. The program lets Lyft offer its ride-hail drivers an alternate stream of income during the coronavirus pandemic. Though not entirely the same, rival Uber (NYSE:UBER) already has a built-in option with its Uber Eats business.

\n\nNetflix worth more than Disney

\n\nInvestors are clearly expecting Netflix (NASDAQ:NFLX) to benefit from the coronavirus crisis amid a streaming boom with millions of people under stay-at-home orders. In fact, its shares closed at $426.75 on Wednesday, giving the company a market cap of $187.3B and putting it just over Disney’s (NYSE:DIS) $186.6B. The latest? Cowen sees a strong quarter for Netflix – powered by strong original content and a “captive audience” from the pandemic – when it reports Q1 earnings on April 21.

\n\nWhat else is happening…

\n\nHeavy layoffs at Royal Caribbean (NYSE:RCL).

\n\nUnited Airlines (NASDAQ:UAL) cuts May schedule by 90%.

\n\nJ.C. Penney (NYSE:JCP) skips interest payment.

\n\nWhat might a return to the movies look like?

\n\nAmazon (NASDAQ:AMZN) shutters French warehouses after safety dispute.

\n\nBarrick Gold (NYSE:GOLD) buys 800,000 antibody test kits.

\n\nStrategy change at GoPro (NASDAQ:GPRO), slashes workforce by 20%.

\n\nTesla (NASDAQ:TSLA) must face lawsuit over Musk’s going-private tweet.

\n\nWednesday’s Key Earnings<\/B>
\nBank of America (BAC) -6.5% on huge reserve build.
\nBed Bath & Beyond (NASDAQ:BBBY) +11.5% AH posting slight sales beat.
\nCharles Schwab (NYSE:SCHW) -4.3% on falling Q1 net interest revenue.
\nCitigroup (C) -5.6% reflecting coronavirus impacts.
\nGoldman Sachs (GS) +0.2% giving mixed results.
\nPNC Financial (NYSE:PNC) -6% building Q1 PCL for COVID-19.
\nU.S. Bancorp (NYSE:USB) -6.9% amid rising loans and deposits.
\nUnitedHealth (NYSE:UNH) +4.1% on Q1 beat; guidance affirmed.

\n\nToday’s Economic Calendar<\/B>
\n8:30 Housing Starts
\n8:30 Initial Jobless Claims
\n8:30 Philly Fed Business Outlook
\n10:30 EIA Natural Gas Inventory
\n4:30 PM Money Supply
\n4:30 PM Fed Balance Sheet

\n\n———————-

\n\n Good morning. Happy Wednesday. <\/span>

\n\n The Asian\/Pacific<\/strong> markets closed with a lean to the downside. Japan, South Korea, New Zealand, Malaysia and the Philippines did well, but China, Hong Kong, India, Taiwan, Indonesia, Singapore and Thailand were weak. Europe, Africa and the Middle East<\/strong> are currently very weak. The UK, Poland, France, Germany, Turkey, the UAE, Russia, Greece, South Africa, Finland, Norway, Hungary, Spain, the Netherlands, Italy, Austria, Sweden and the Czech Republic are down 2% or more. Futures in the States<\/strong> point towards a big gap down open for the cash market. <\/span>

\n\n—————\nChart With Traders Podcast<\/a> <\/span>\n—————<\/span>

\n\n The dollar is up. Oil and copper are down. Gold and silver are down. Bonds are up. <\/span>

\n\n Stories\/News from Seeking Alpha…<\/span>

\n\nDuring the White House coronavirus briefing, President Trump says he could start speaking with state governors as early as Thursday about reopening plans. The governors will be in charge of when and how to open, but FEMA and the CDC have reportedly developed guidelines on a safe, phased approach. Trump says that 29 states are in “good shape” regarding the coronavirus and could reopen earlier than May 1.

\n\nJetBlue lands $936M in payroll aid

\n\nThrough the U.S. CARES Act, JetBlue (NASDAQ:JBLU) will receive $685M in grants and $251M in loans from the government. The grant covers about 56% of the company\u2019s payroll costs for a six-month period last year. The low-interest loan will be paid back to the government starting October. JetBlue has to maintain a minimum level of domestic air service to receive the funds.

\n\nJ.C. Penney eyes bankruptcy

\n\nWith long-term financials becoming more untenable, J.C. Penney (NYSE:JCP) is reportedly considering bankruptcy protection. Reuters sources say the retail chain has enough cash to survive a few months of store closures, and rescue financing remains an option.

\n\nFrontier Communications files for bankruptcy

\n\nFrontier Communications (NASDAQ:FTR) has filed for Chapter 11 bankruptcy protection just before April 15 debt payments came due. That comes through a prearranged restructuring support agreement that has the backing of creditors representing more than 75% of Frontier’s $11B in outstanding unsecured bonds. It results in $460M in debtor-in-possession financing – which Frontier says will combine with cash on hand for $1.1B-plus in liquidity, enough to provide uninterrupted operations.

\n\nTesla China registrations jump with Shanghai pumping out Model 3s

\n\nWith its Shanghai plant producing local Model 3s – including two newer versions – Tesla (NASDAQ:TSLA) has seen its China car registrations vault 450% month over month in March. The registrations were up to 12,709 units vs. February’s 2,314. The Shanghai factory added a Long Range Model 3 and a Performance Model 3 to its repertoire last week.

\n\nAirbnb secures new $1B loan

\n\nAirbnb (AIRB) has locked down a new $1B loan, just over a week after it raised $1B in a debt deal. The new deal is a five-year first-lien deal – and one link between the two deals: Silver Lake, which was one of two investors in the week-ago deal, is a key player in the new loan, Reuters says.

\n\nWhat else is happening…

\n\nBarclays (NYSE:BCS) pauses new job cuts amid COVID-19 crisis.

\n\nZoox agrees to settle lawsuit with Tesla (TSLA) for alleged trade secret theft.

\n\nTexas oil production cut proposal stirs up anger on both sides.

\n\nBroadcom (NASDAQ:AVGO) raises consideration in debt tenders.

\n\nLyondellBasell (NYSE:LYB) Houston FCC restart set as soon as Thursday.

\n\nTuesday’s Key Earnings<\/B>
\nJ.B. Hunt Transport Services (NASDAQ:JBHT) +4.2% AH on Q1 revenue growth.

\n\nToday’s Economic Calendar<\/B>
\n7:00 MBA Mortgage Applications
\n8:30 Retail Sales
\n8:30 Empire State Mfg Survey
\n9:15 Industrial Production
\n10:00 Business Inventories
\n10:00 NAHB Housing Market Index
\n10:00 Atlanta Fed’s Business Inflation Expectations
\n10:30 EIA Petroleum Inventories
\n1:00 PM Fed’s Bostic: Economic Outlook
\n2:00 PM Fed’s Beige Book
\n4:00 PM Treasury International Capital

\n\n———————-

\n\n Good morning. Happy Tuesday. <\/span>

\n\n The Asian\/Pacific<\/strong> markets posted solid gains. Japan, China, South Korea, New Zealand, Taiwan, Australia, Malaysia, Indonesia, Singapore, Thailand and the Philippines did great. Europe, Africa and the Middle East<\/strong> are currently mostly up. Denmark, Poland, Turkey, Germany, the UAE, Greece, South Africa, Finland, Switzerland, Norway, Austria, Sweden and the Czech Republic are leading. Futures in the States<\/strong> point towards a moderate gap up open for the cash market. <\/span>

\n\n—————\nVIDEO: Recent Example Trades<\/a> <\/span>\n—————<\/span>

\n\n The dollar is down. Oil is down; copper is up. Gold and silver are up. Bonds are flat. <\/span>

\n\n Stories\/News from Seeking Alpha…<\/span>

\n\nU.S. stock futures rise, following gains in most equities markets around the world, amid optimism that the coronavirus curve is flattening. Dow futures advance 1.3%, Nasdaq gains 1.5% and S&P futures rise 1.2%. The 10-year Treasury yield remains flat at 0.75%. In overseas markets, the Stoxx Europe 600 rises 0.9% and the DAX gains 1.1%. In Asia, markets also ended the session in the green – the Hang Seng rose 0.6%, China\u2019s CSI 300 rose 1.9% and the Nikkei 225 increased 3.1%. In the U.S., Q1 earnings season kicks off with JPMorgan Chase (NYSE:JPM), Wells Fargo (NYSE:WFC) and Johnson & Johnson (NYSE:JNJ). With most of the coronavirus-related restrictions not taking effect until mid-March, investors will be focusing on any forward-looking commentary.

\n\nChina\u2019s trade isn\u2019t out of the woods yet

\n\nThough the world\u2019s second-largest economy recorded a trade surplus of $18.5B in March, vs. a deficit of $7.1B in the first two months of the year, China will now be facing lower demand from the countries it exports to. “Uncertainties are on the rise and China\u2019s foreign trade is encountering bigger difficulties,” said Li Kuiwen, a customs spokesperson. Still, investors cheered the economic news. China\u2019s CSI 300 Index closed up 1.9% and Japan\u2019s Nikkei Index gained 3.1%. Hong Kong\u2019s Hang Seng rose 0.5%.

\n\nAirline relief deal nears the finish line

\n\nAirline industry officials expect all major airlines to accept the terms for grants, with some announcements expected as early as today. The government has set identical terms for industry players and says it won’t negotiate individually with airline managements. Those terms include a requirement that 30% of the funds allotted to each airline be repaid and the issuance of warrants with prices already locked in. The Treasury Department is not demanding compensation from small carriers receiving $100M or less in payroll support. If the $25B in grants is allotted as expected, the government could end up owning about 3.0% of American Airlines (NASDAQ:AAL), 2.3% of United Airlines (NASDAQ:UAL), 1.3% of JetBlue (NASDAQ:JBLU), 1% of Delta Air Lines (NYSE:DAL) and 0.6% of Southwest Airlines (NYSE:LUV).

\n\nTesla pursues rent reductions amid pandemic

\n\nFacing the need for cost savings amid the global pandemic, Tesla (NASDAQ:TSLA) is approaching landlords in search of reduced rent, the WSJ reports. “As a result of the increasing restrictions on our ability to conduct business, we would like to inform you that we will be reducing our monthly rent obligations effective immediately,” reads one email the company sent. The news follows last week’s announcement that Tesla would slash pay and furlough employees who couldn’t work from home.

\n\nIndia extends 1.3B-person lockdown until May 3

\n\nAs widely expected, India is extending the world’s biggest pandemic lockdown at least until May 3. The country’s restrictions were set to end today, even as its confirmed case count crossed 10,000 and deaths hit 339 (low numbers compared to harder-hit countries, which experts caution may be due to low testing levels). Despite the extension of the restrictions, India has expressed an interest in at least partially restarting its manufacturing industry now rather than later.

\n\nThe case for India investments weakens

\n\nThe country\u2019s economy was already weakening when the coronavirus hit, giving investors fewer reasons to buy Indian stocks and bonds, said BlackRock\u2019s head of Asian credit, Neeraj Seth. “India entered the whole situation of COVID on a weaker footing,” and the lockdown has put more pressure on the banking system, he told CNBC. BlackRock is cautious on Indian credit at the lower end of the spectrum, but fixed income investments could benefit as India\u2019s central bank is expected to cut interest rates, he said.

\n\nExxon taps bond market for second time in a month

\n\nThe oil giant raised $9.5B in debt on Monday, less than a month after issuing $8.5B, as it seeks to bolster its finances while the market is still receptive to issuers of new debt. In the latest offering, Exxon (NYSE:XOM) sold five different bonds with durations ranging from five to 31 years. The issue highlighted investor demand for the debt, as the offering was upsized from the $9B issue originally planned and Exxon was able to borrow at a lower price than the March deal.

\n\nWhat else is happening…

\n\nFed launches commercial paper funding facility today.

\n\nDOJ puts the heat on British American Tobacco (NYSE:BTI).

\n\nDisney (NYSE:DIS) enters new $5B credit agreement.

\n\nRoku (NASDAQ:ROKU) early Q1 numbers show growth turn.

\n\nNavistar (NYSE:NAV) conserves cash.

\n\nToday’s Economic Calendar<\/B>
\n8:30 Import\/Export Prices
\n8:55 Redbook Chain Store Sales
\n11:05 Fed’s Bullard: \u201cCOVID-19 Briefing\u201d
\n12:30 PM Fed’s Evans Speech

\n\n————————-

\n\n Good morning. Happy Monday. Hope you had a good weekend. <\/span>

\n\n The Asian\/Pacific<\/strong> markets leaned down. The Philippines did well, but Japan, China, South Korea and India were weak. Europe, Africa and the Middle East<\/strong> are mostly closed. Turkey is up; the UAE, Russia, Israel and Saudi Arabia are down. Futures in the States<\/strong> point towards a flat open for the cash market. <\/span>

\n\n—————\nVIDEO: Recent Example Trades<\/a> <\/span>\n—————<\/span>

\n\n The dollar is down. Oil is flat; copper is up. Gold and silver are down. Bonds are down. <\/span>

\n\n Stories\/News from Seeking Alpha…<\/span>

\n\nCrude oil (NYSEARCA:USO) was the weekend’s major development after OPEC+ agreed to cut production by a record 9.7 million barrels per day, but prices are mixed in volatile overnight trading on concerns that the cuts will not be enough to head off oversupply as the coronavirus hits demand. The agreement is “too little and too late to avoid breaching storage capacity, ensuring that low oil prices force all producers to contribute to the market rebalancing,” according to analysts at Goldman Sachs. “It’s simply too late to prevent a super-large inventory build of over one billion barrels between mid-March and late May and to stop spot prices from falling into single digits,” says Ed Morse, Citi’s global head of commodities. But at least the deal allows the global oil industry and the national economies that depend on it to “avoid a very deep crisis,” says IHS Markit’s Daniel Yergin.

\n\nKashkari paints gloomy view of economic recovery

\n\nMinneapolis Fed President Neel Kashkari expects the path to economic recovery from the coronavirus will be a “long, hard road” and not a V-shaped rebound. “Barring some healthcare miracle” such as an effective therapy or vaccine, “it seems we’re going to have various phases of rolling flareups,” Kashkari told CBS’s Face the Nation, with “different parts of the economy turning back on, maybe turning back off again.” Kashkari also said $350 billion in emergency funds for small business would not be enough, “because if we need to have different phases of shutdowns for the next several months or until we have a therapy or vaccine, we’re going to need more help than that.”

\n\nSmithfield warns of food shortages

\n\nThe U.S. is “perilously close to the edge in terms of our meat supply,” Smithfield Foods CEO Kenneth Sullivan said after announcing the closing of his company’s Sioux Falls processing facility in South Dakota, which accounts for at least 4% of U.S. pork production. “It is impossible to keep our grocery stores stocked if our plants are not running,” Sullivan warned, adding that he fears “disastrous” consequences up the supply chain for the nation’s livestock farmers if plants stop running. “We have a stark choice as a nation: We are either going to produce food or not, even in the face of COVID-19.”

\n\nEarly analysis of Gilead’s COVID-19 treatment looks promising

\n\nGilead Sciences’ (NASDAQ:GILD) experimental drug for patients with severe COVID-19 infections showed promise in an early analysis published in The New England Journal of Medicine, raising hopes that the first treatment for the novel virus may be on the horizon. A cohort analysis of 53 severely ill hospitalized COVID-19 patients who received the company’s antiviral remdesivir on a compassionate use basis showed 68% needed less oxygen or breathing machine support. Results from more rigorous studies are expected by the end of this month.

\n\nApple, Google develop smartphone platform to track virus spread

\n\nApple (NASDAQ:AAPL) and Google (NASDAQ:GOOG) have unveiled a rare partnership to add technology to their smartphone platforms that will alert users if they have come into contact with a person with COVID-19. The companies announced jointly on Friday that the “contact tracing” tools they are developing would be built into smartphones, using existing Bluetooth technology that tracks whether phones have passed within a certain distance of one another. Users then could be alerted if they were in contact with an infected person. People must opt in to the system, but it has the potential to monitor about a third of the world\u2019s population.

\n\nAirlines seek changes to rescue package terms

\n\nMajor U.S. airlines are urging Treasury officials to scrap or revise a proposal that would make part of the $25 billion earmarked by Congress to help keep workers on the payroll repayable in the form of low-cost loans. Treasury Secretary Mnuchin told the airlines on Friday the government would require them to repay 30% of the grants in low-cost loans over 10 years. But trade group Airlines for America – which represents American (NASDAQ:AAL), United (NASDAQ:UAL), Delta (NYSE:DAL), Southwest (NYSE:LUV), JetBlue (NASDAQ:JBLU) and others – said it believed the $25B in payroll assistance was “to be only in grants – which is considerably more effective for our employees – and not a combination of grants and loans.” The head of the Association of Flight Attendants union wrote if Treasury insists on airlines repaying $7 billion in grants, “job cuts will happen now AND longer term cuts will come in October.”

\n\nIger reasserting control at roiling Disney

\n\nBob Iger, who left the CEO job at Disney (NYSE:DIS) in late February, but stayed on as executive chairman, has effectively returned to running the day-to-day company as its businesses face pandemic threats on every front, The New York Times reported. Cruise lines, theme parks, movie theaters and even ESPN are basically on hiatus; one estimate shows the company is losing $30 million or more a day. Iger – who had hoped for a calm, triumphant exit – is now trying to help guide the company through a threat that at minimum will be profoundly transformational.

\n\nAmazon to stop accepting new online grocery customers

\n\nAmazon (NASDAQ:AMZN) said it will begin placing new grocery delivery customers on a wait list and reduce shopping hours at some Whole Foods stores to prioritize orders from existing customers buying food online during the coronavirus outbreak. Many shoppers seeking to purchase groceries from Amazon recently have found they could not place orders due to a lack of available delivery slots, so the company said it will relegate all new online grocery customers to a wait list while it works to add capacity. Amazon also plans to shorten public hours at some Whole Foods stores so employees can more quickly fulfill online grocery orders.

\n\nJ.P. Morgan to raise mortgage borrowing standards

\n\nJPMorgan Chase (NYSE:JPM) will raise borrowing standards for most new home loans starting this week, Reuters reported, as the bank seeks to mitigate lending risk caused by coronavirus disruptions. Customers applying for a new mortgage will need a credit score of at least 700 and will be required to make a down payment equal to 20% of the home’s value. The changes are designed to help the bank reduce its exposure to borrowers who unexpectedly lose their job, suffer a decline in wages or whose homes lose value.

\n\nBoeing to resume some Washington operations

\n\nBoeing (NYSE:BA) plans to call about 2,500 employees to resume some of its operations in Washington state, including defense work, signaling a partial end to a shutdown that began March 25 because of the coronavirus outbreak. The work to resume is related to its P-8 maritime surveillance aircraft, KC-46 aerial refueling tanker and support of 737 MAX storage. The company is not yet resuming commercial aircraft production. Boeing says its phased approach to restarting operations will help ensure a reliable supply chain and prepare it for future restarts.

\n\nIndia may restart some manufacturing Wednesday

\n\nIndia is considering restarting some of its manufacturing this week even if the world’s biggest lockdown is extended to the end of the month, as is expected. That lockdown is to end Tuesday, and Prime Minister Modi has directed that some crucial industries get going again as soon as Wednesday, Reuters reports. Separately, the industries ministry has recommended restarting manufacturing in autos, textiles, defense, electronics and other sectors.

\n\nWhat else is happening…

\n\nBoris Johnson released from hospital.

\n\nFacebook (NASDAQ:FB) spent $23M on Zuckerberg security, private travel.

\n\nAMC (NYSE:AMC) reportedly in bankruptcy talks.

\n\nToday’s Economic Calendar<\/B>
\nNo event scheduled

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