ticker

Stocks Turned Lower On Recession Worries

Barry Adams
22 Jun, 2022
New York City

Stocks turned lower after rallying in the previous session and investors refocused on rising inflation and elevated energy prices.

Fears of an economic recession weighed on investor sentiment after the Fed Chairman Jerome Powell reaffirmed central banks commitment in fighting inflation.

"We are strongly committed to bringing inflation back down, and we are moving expeditiously to do so.

We have both the tools we need and the resolve it will take to restore price stability on behalf of American families and businesses," Powell told Congress on Wednesday.

Though the Fed expressed its strong commitment to fight inflation, prices have been rising at a faster pace for more than a year.

The consumer price index has been rising at more than the Fed's target rate of 2% for the last seventeen months in a row.

The S&P 500 rose 0.9% to 3,731.83 and the Nasdaq Composite fell 0.7% to 10,985.52.

Futures of crude oil fell 6.2% to $107.51 a barrel and natural gas fell 10 cents to $6.70 a unit.

On Wednesday, President Joe Biden is expected to ask Congress to drop federal gasoline and diesel taxes for three months.

Weaker oil prices dragged down stocks in the energy complex.

Chevron and Marathon Oil dropped more than 5%, Exxon Mobil declined 4%. Schlumberger NV fell 6%.

After the market closes today, KB Home, Worthington Industries, and Steelcase are scheduled to release earnings.

European Markets Accelerate Declines

European markets accelerated declines after the U.K. inflation surged more than expected.

Consumer price index rose 9.1% in May from 9.0% in April, according to the latest data from the Office for National Statistics.

Month to month price increase slowed to 0.7% from 2.5% in April, the report stated.

The DAX index fell 2.0% to 13,027.62, the CAC-40 index declined 1.8% to 5,859.51, and the FTSE 100 index dropped 1.5% to 7,045.08.

Oil companies traded lower after crude oil prices declined 6% in the region.

BP Plc fell 3.6%, Shell Plc decreased 3.6%, and Repsol S.A. declined 4.8%.

BASF SE declined 5.6% to 43.30 euros after the chemical company said business in the second-half is likely to face considerable downturn.

Asian Markets Turn Lower

Markets in Asia closed lower following weak commodities prices and European markets.

Crude oil prices in Asia declined 4% and natural gas prices dropped between 2% and 3% on the global recession worries.

The Nikkei index in Tokyo declined 0.4% to 26,149.55 and indexes in Hong Kong dropped 2.6% to 21,008.34 and in Shanghai fell 1.2% to 3,267.20.

The Sensex index lost 709.54 or 1.4% to 51,822.53 and the Nifty 50 index dropped 225.50 or 1.44% to 15,413.30.

S&P 500 and Nasdaq Rebound 2.5% After Volatile Week

Barry Adams
21 Jun, 2022
New York City

Stocks rebounded sharply after a week when the S&P 500 declined the most in two years and bargain hunters stepped up buying.

The S&P 500 rose 2.5% to 3,764.79 and the Nasdaq Composite advanced 2.5% to 11,069.30.

Futures of crude oil rose 0.9% to $110.59 a barrel but natural gas fell 9 cents to $6.85 a unit.

The yield on 10-year Treasury notes increased a fraction to 3.302%.

The sharp rally on Wall Street was viewed as a dead cat bounce and market indexes have jumped more than 2% at least 11 times in the last three months.

The S&P 500 and the Nasdaq Composite have fallen in 10 of the last 11 weeks.

Last week, Investors worried that the Fed is so far behind in taming inflation with record negative rates (the difference between inflation and 10-year Treasury note yield) above 5%.

Inflation has been accelerating and reached a 4-decade high of 8.6% in May, surpassing Fed's target rate of 2% for more than 17 months in a row.

The Fed's aggressive rate hike by 75 basis points last week to a new range to 1.5% and 1.75% was welcomed by investors but a day after investors worried that faster rate hike may plunge the U.S. economy into a recession.

Seasonally adjusted existing home sales in May declined 3.4% from a year ago and April home sales were revised lower as well, the National Association of Realtors said today.

Homes for sale in May increased 12.6% from April but still 4.1% lower than a year ago.

The median home price sold in May increased 14.8% to $407,600, a record high since data keeping began about 40 years ago, said the NAR.

Home prices have been advancing for 123 months in a row, the longest streak of price increase on record.

Lennar Corp gained 4.5% to $67.53 after the home builder reported better-than-expected sales and higher-than-expected adjusted earnings of $4.69 a share.

The home builder said that the home demand began to soften towards the end of the quarter by higher home prices and rising mortgage rates.

Airline stocks were in focus today on summer travel surge.

Spirit Airlines advanced 8% after JetBlue lifted its offer price to $33.50 a share as the company board discusses its merger plans with Frontier Air.

Kellogg Company gained 2.1% to $69.07 after the food products maker said it plans to split into three separate companies and separate its domestic and international cereal businesses and plant-based snack and food unit.

European Markets Extend 2-Day Advance

European markets extended gains for the second day in a row powered by gains in New York and Asian markets.

Bargain hunters stepped up for the second day in a row despite the lingering worries of inflation and global economic slowdown.

The DAX index gained 0.2% to 13,292.49, the CAC-40 index advanced 0.8% to 5,964.66, and the FTSE 100 index rose 0.4% to 7,152.08.

Futures of crude oil increased 1.5% to $115.40 a barrel and European natural gain advanced 3.6% to 125.40 euros a unit.

Ocado Group decreased 4.2% to 840.80 pence after the online grocery delivery company completed a secondary offering and raised

Mondelez to Acquire Clif Bar & Company for $2.9 Billion

Scott Peters
21 Jun, 2022
New York City

Mondelez International Inc gained 1.3% to $59.57 after the company agreed to acquire Clif Bar & Co. for $2.9 billion and additional earnings contingent payouts.

Clif Bar & Company will continue to operate its business from its headquarters in Emeryville, CA and company will also continue to manufacture its products in its facilities in Twin Falls, Idaho, and Indianapolis, Indiana.

Movers: Clif Bar, Kellogg, Lennar, Mondelez, Spirit Air, Tesla, Valneva

Barry Adams
21 Jun, 2022
New York City

Kellogg Company gained 2.6% to $69.30 after the food products maker said it plans to split into three separate companies.

North America cereal company with about total sales of $2.4 billion covering the U.S, Canada, and Caribbean.

Global snacking company with about total sales of $11.4 billion covering international markets for cereals and North American frozen food businesses.

Plant Co with about total sales of approximately $340 million focus on plant faced food and anchored with the MorningStar Farms brand.

Lennar Corp jumped 2.5% to $66.41 after the home builder reported better-than-expected sales and higher-than-expected adjusted earnings of $4.69 a share.

The home builder said that the home demand began to soften towards the end of the quarter by higher home prices and rising mortgage rates.

Mondelez International Inc gained 1.3% to $59.57 after the company agreed to acquire Clif Bar & Co. for $2.9 billion and additional earnings contingent payouts.

Clif Bar & Company will continue to operate its business from its headquarters in Emeryville, CA and manufacture its products in its facilities in Twin Falls, Idaho, and Indianapolis, Indiana.

Spirit Airlines advanced 7% after JetBlue lifted its offer price to $33.50 a share as the company board discusses its merger plans with Frontier Air.

Tesla Inc soared 11.4% to $724.79 after CEO Elon Musk confirmed in an interview with Bloomberg News that the automaker is planning to cut 10% salaried staff or 3.5% of total over the next three months.

Valneva SE ADR soared 89.5% to $25.98 after Pfizer agreed to acquire 8.1% stake in France-based specialty vaccine maker for $95 million.

Movers: Airbus, Air Liquid, DS Smith, Nordex, Ocado

Bridgette Randall
21 Jun, 2022
New York City

Ocado Group decreased 4.2% to 840.80 pence after the online grocery delivery company completed a secondary offering and raised

S&P 500 Jumps 2.6%, Record Existing Home Price In May

Barry Adams
21 Jun, 2022
New York City

Stocks in the early morning bounced back after a 3-day weekend and bond yields advanced.

The S&P 500 rose 2.2% to 3,759.33 and the Nasdaq Composite rose 2.8% to 11,101.50.

Futures of crude oil rose 1.9% to $111.69 a barrel and natural gas fell 26 cents to $6.69 a unit.

The sharp rally on Wall Street was viewed as a dead cat bounce and market indexes have jumped more than 2% at least 11 times in the last three months.

The S&P 500 and the Nasdaq Composite have fallen in 10 of the last 11 weeks and investor sentiment has been pessimistic with growing skepticism that the Fed can tame inflation and avoid a recession.

Inflation has been accelerating and stayed above the Fed's target range of 2% for more than 17 months and reached a 4-decade high of 8.6% yet interest rates are near 1.75%.

Seasonally adjusted existing home sales in May declined 3.4% from a year ago and April home sales were revised lower as well, the National Association of Realtors said today.

Homes for sale in May increased 12.6% from April but still 4.1% lower than a year ago.

The median home price sold in May increased 14.8% to $407,600, a record high since data keeping began about 40 years ago, said the NAR.

Home prices have been advancing for 123 months in a row, the longest streak of price increase on record.

Lennar Corp gained 4.5% to $67.53 after the home builder reported better-than-expected sales and higher-than-expected adjusted earnings of $4.69 a share.

The home builder said that the home demand began to soften towards the end of the quarter by higher home prices and rising mortgage rates.

Airline stocks were in focus today on summer travel surge.

Spirit Airlines advanced 7% after JetBlue lifted its offer price to $33.50 a share as the company board discusses its merger plans with Frontier Air.

Kellogg Company gained 2.1% to $69.07 after the food products maker said it plans to split into three separate companies.

European Markets Extend 2-Day Advance

European markets extended gains for the second day in a row powered by gains in New York and Asian markets.

Bargain hunters stepped up for the second day in a row despite the lingering worries of inflation and global economic slowdown.

The DAX index gained 0.1% to 13,189.19, the CAC-40 index advanced 0.2% to 5,896.14, and the FTSE 100 index rose 1.5% to 7,117.38.

Futures of crude oil increased 1.5% to $115.40 a barrel and European natural gain advanced 3.6% to 125.40 euros a unit.

Ocado Group decreased 4.2% to 840.80 pence after the online grocery delivery company completed a secondary offering and raised

European Indexes Extend 2-Day Rally

Bridgette Randall
21 Jun, 2022
New York City

European markets extended gains for the second day in a row powered by gains in New York and Asian markets.

Bargain hunters stepped up for the second day in a row despite the lingering worries of inflation and global economic slowdown.

The DAX index gained 0.1% to 13,189.19, the CAC-40 index advanced 0.2% to 5,896.14, and the FTSE 100 index rose 1.5% to 7,117.38.

Futures of crude oil increased 1.5% to $115.40 a barrel and European natural gain advanced 3.6% to 125.40 euros a unit.

Ocado Group decreased 4.2% to 840.80 pence after the online grocery delivery company completed a secondary offering and raised

French President Macron Loses Control of Parliament, Historic Gains for Far Right and Left Groups

Bridgette Randall
20 Jun, 2022
Frankfurt

French President Emanuel Macron's party and allies lost their absolute majority in the National Assembly after the second and final round of election.

Grinding war in Ukraine, a sharp jump in food and energy prices and general voter discontent drove many to parties on the far right and far left.

The coalition led by president Macron, Ensemble!, won 245 of 577 legislative seats, leading all other parties and coalitions, according to a report released by the French interior ministry .

President Macron won a second term in April and will be the first president without a parliamentary majority since 2000 putting his legislative agenda of business and pension reforms in jeopardy.

Voters showed little interest in the legislative election and about 53% abstained from voting in the second round.

President Macron's centrist alliance enjoyed a substantial majority of 350 seats in 2017 but parties on the hard-let and the hard-right were successful in shrinking that to 245 in the latest election on June 19.

The latest parliamentary election results are highly unusual in France where the seating president generally enjoys a majority in parliament and governs with a free hand.

Macron is not known for sharing power or consulting with other parties as he governed top-down in the first term and largely used parliament as a president's rubber-stamp turning off voters.

Moreover, Macron's first term was marred by several crises starting with the "yellow vest" protests in rural France and spreading nationwide against the fuel tax in 2018, followed by coronavirus pandemic in 2020 and Ukraine war in 2022.

France holds the presidency of the Council of the European Union for six months till the end of June and that also distracted him during the last week of election.

Far-right National Party led by Marine Le Pen increased from a handful 8 seats to 89 and an alliance of leftist parties Nupes led by Jean-Luc Melenchon won 131 seats becoming the largest opposition party.

Historic gains for the parties on the left and right are going to force Macron's second term with more participation from the parliament.

European Markets Advance In Cautious Trading

Bridgette Randall
20 Jun, 2022
New York City

European markets rebounded after falling sharply in the previous week.

The DAX index gained 0.1% to 13,189.19, the CAC-40 index advanced 0.2% to 5,896.14, and the FTSE 100 index rose 1.5% to 7,117.38.

French President Emmanuel Macron's party and allies lost their absolute majority in the National Assembly after the second and final round of election.

The coalition, Ensemble!, won 245 of 577 legislative seats, leading all other parties and coalitions but fell short of the absolute majority, according to a report released by the French interior ministry .

President Macron won a second term in April and will be the first president without a parliamentary majority since 2000 putting his legislative agenda of business and pension reforms in jeopardy.

ECB President Christine Lagarde reaffirmed the central bank's commitment in raising rates two times this summer and fighting the widening interest rate spreads in the region.

The central bank will "ensure that inflation stabilizes at our 2% target over the medium term," Lagarde said while addressing the European Parliament in Brussels.

German producer prices in May surged a record 33.6% after rising at 33.5% in April, according to the latest data released by Destatis in Germany.

On a monthly basis, prices rose 1.6% after rising 2.8% in April, the report noted.

Airbus SE increased 0.95% to 95.01 euros on news that the aviation company has entered into talks with Qatar Airways to resolve A 350 passenger plane legal and safety dispute.

Valneva SE rose 25.2% to 9.96 euros after the U.S. based Pfizer agreed to acquire a 8.1% stake in the French specialty vaccines maker for 90.5 million euros.

SThree jumped 6.4% to 339.50 pence after the specialty staffing company said profit in the full-year ending in November is expected to be ahead of expectations by 5%.

Revenues in the first-half increased 25% to 203.1 million pounds and revenues in Germany rose 22%, in the U.S. increased 21%, and in the Netherlands surged 41%.

S&P 500 Logs Worst Weekly Loss Since March 2020, Oil Drops 6%

Barry Adams
17 Jun, 2022
New York City

Stocks closed higher in volatile trading but ended down after a tumultuous week.

Investors cheered on Wednesday after the Federal Reserve took strong action and lifted rates more than advertised but a day after reality of higher rates began to set in.

The Fed's 75-basis-point rate hike is the most aggressive step since 1994 but the Fed is still lagging behind by a wide margin when inflation is running near 9% and showing no sign of ebbing.

The Fed is also powerless in changing the trajectory of energy prices and in eliminating pandemic related supply chain disruptions.

In addition, most companies are raising prices more than cost increases fueling inflation higher.

In other words, the Fed's rate action may not impact inflation rooted in energy prices by much but most likely will slowdown the economy and increase unemployment rate.

The Fed can only impact demand and hope that lower demand will trend inflation downward but will not be able to root it out completely.

This outcome is not what investors were looking for when they were cheering for the larger and faster rate hikes.

The Fed is in a tough spot because fighting elevated inflation while keeping the economic engine humming is a delicate balance with many factors outside its control.

Skeptical investors are opting that the Fed may pursue faster rate hikes in future but that will certainly slow the economy faster too turning the Fed's expectation of 1.7% economic growth in 2022 largely out of reach.

Historically, the Fed has never managed to tame inflation above 6% without dipping the economy into a recession, meaning a profit recession and lower stock valuations.

Only time will tell if we will end up in a recession, soft landing, or just a slow down, but one thing is sure, rising rates almost always lower stock valuations.

At least today, tech stocks were in favor after a week of selling and bargain hunters were ready to add more stocks.

The yield on 10-year notes declined a fraction to 3.23% but mortgage rates remained elevated, inching closer to 6%.

The 30-year fixed-rate mortgage rates jumped to 5.78% for the week ending June 16, an increase of more than half a percentage point and the largest increase on a weekly basis since 1987, according to the survey conducted by Freddie Mac.

Mortgage rates have jumped little more than two-and-a-half percentage points from the beginning of the year and jumped from 2.93% a year ago.

Oil prices dropped to a four-week low on the growing prospects of economic recession and the U.S. dollar rose against a basket of currencies.

Russia's oil exports are going to increase in 2022 despite Western sanctions and European blockade, according to Tass news agency quoting deputy energy minister Pavel Sorokin.

In addition, oil from Venezuela is expected to reach refineries in Italy and Spain as early as next month, adding more oil supplies in the international markets.

Futures of crude oil declined 6.5% to $109.95 a barrel and natural gas fell 6.1% to $7.00 a unit.

The S&P 500 declined 0.6% to 3,674.98 and the Nasdaq Composite rose 1.4% to 10,798.90.

For the week, the S&P 500 fell 5.8% and registered its worst weekly loss since March 2020.

The Nasdaq Composite fell 4.8% in the week.

Tech stocks led the rebound in trading and Apple, Tesla, Amazon, Meta, Alphabet, and Microsoft rose between 1.0% and 1.5%.

Home Depot, Intel, JPMorgan, and 3M dropped to their new 52-week lows today.

Kroger Co declined 7.7% to $46.20 after the food retailer said sales in the first quarter ending May 21 rose 4.1% to $44.6 billion from a year ago.

Earnings increased to $664 million or 90 cents a share from $140 million or 18 cents in the same period.

The retailer guided comparable sales in the fiscal 2022 to increase between 2.5% and 3.5% and said in the quarter repurchased $665 million of its shares.

Kroger stock fell after the retailer said higher inflation is forcing more customers to select store branded items.

Mortgage Rates Jump to 5.78%, the Largest Weekly Jump Since 1987

Brian Turner
16 Jun, 2022
New York City

The 30-year fixed-rate mortgage rates jumped to 5.78% for the week ending June 16, an increase of more than half a percentage point and largest increase on a weekly basis since 1987, according to the survey conducted by Freddie Mac.

Mortgage rates have jumped little more than two-and-a-half percentage points from the beginning of the year and jumped from 2.93% a year ago.

Industrial Production Increased 0.2% in May

Brian Turner
17 Jun, 2022
New York City

Total industrial production increased 0.2% in May and output has increased in every month of the year so far, with an average monthly gain of nearly 0.8%, according to the latest data released by the Federal Reserve.

Manufacturing output declined 0.1% after three months when growth averaged nearly 1%.

In May, the indexes for utilities and mining rose 1.0% and 1.3%, respectively.

Capacity utilization increased in May to 79.0% from 78.9% in April, the Fed statement noted.

Stocks Rebound Lacking Direction On Wall Street

Barry Adams
17 Jun, 2022
New York City

Stocks lacked direction and investors struggled to digest the impact of rising rates and Fed's ability to tame inflation without dipping the economy into a recession.

The mood on Wall Street reversed a day after the Fed raised rates at a faster pace than advertised before as investors began to digest the implications of higher rates faster.

The 75 basis points rate increase also accompanied the Fed lowering economic growth rate estimate to 1.7% for the current year from the previous estimate of 2.8% in March and increasing the jobless rate to 3.7% from 3.5%.

The 30-year fixed-rate mortgage rates jumped to 5.78% for the week ending June 16, an increase of more than half a percentage point and largest increase on a weekly basis since 1987, according to the survey conducted by Freddie Mac.

Mortgage rates have jumped little more than two-and-a-half percentage points from the beginning of the year and jumped from 2.93% a year ago.

Total industrial production increased 0.2% in May and output has increased in every month of the year so far, with an average monthly gain of nearly 0.8%, according to the latest data released by the Federal Reserve.

Manufacturing output declined 0.1% after three months when growth averaged nearly 1%.

In May, the indexes for utilities and mining rose 1.0% and 1.3%, respectively.

Capacity utilization increased in May to 79.0% from 78.9% in April, the Fed statement noted.

The S&P 500 declined 0.6% to 3,644.98 and the Nasdaq Composite rose 0.1% to 10,657.90.

For the week, the S&P 500 is down 3.3% and the Nasdaq Index 2.01%.

Tech stocks led the mild rebound in early trading.

Apple, Tesla, Amazon, Meta, Alphabet, and Microsoft rose between 1.0% and 1.5%.

Home Depot, Intel, JPMorgan, and 3M dropped to their new 52-week lows today.

European Markets Down 3% Weekly, Record High Inflation

European markets advanced and crude oil prices stabilized as investors shook off worries of rising rates and elevated inflation.

Market indexes advanced after crude oil prices stabilized above $115 a barrel and European natural gas prices declined 1.4% to $122.34 a unit.

Stocks opened higher but lacked direction and continued to trade in a tight range and positive bias after the Chinese cabinet vowed to support economic recovery through several measures.

Investors also took in strides the latest moves by the central banks in the UK. and Switzerland.

The DAX index gained 1.1% to 13,104.29, the CAC-40 index advanced 0.5% to 5,917.74, and the FTSE 100 index rose 0.5% to 7,078.28.

For the week, the DAX index declined 2.98%, the CAC-40 fell 2.47%, and the FTSE 100 index eased 3.3%.

Euro zone inflation rose to a record high of 8.1% in May on an annual basis, according to the final data released by the eurostat today.

The Swiss National Bank raised its key lending rate by 50 basis points to -0.25% and revised higher its inflation outlook for the year on Wednesday.

In 2022, the Swiss economy is estimated to grow at 2.5% and inflation at 2.8% before cooling down to 1.9% in 2023 and 1.6% in 2024.

The SNB noted in a statement that the unemployment is likely to remain low and "mortgage lending and residential property prices have risen further in recent quarters.

The SNB will continue to monitor developments on the mortgage and real estate markets closely."

On Thursday, the Bank of England lifted its key lending rate by 25 basis points to 1.25% and said inflation is likely to reach above 11% in the next few months.

The central bank noted that not all inflation is driven by the war in Ukraine and supply chain disruptions but pricing strategies of goods and services providers are also playing a role.

Banco Santander SA gained 2.7% to 2.71 euros after the Spanish bank appointed H

European Indexes Close Down 3%, May Inflation at Record High 8.1%

Bridgette Randall
17 Jun, 2022
New York City