Baltic Dry Index. 1281 +80 Brent Crude 74.10
Alan Greenspan. June 28, 2016.
This week, more of the same, or something
different? Crude oil into the 80s? Earnings results not boosting stocks to new
highs? US 10 years trading in the 3s? An
informal China – India summit leading to a new Asian mega-partnership? A US walk back on its Great Global Trump
Trade War?
Any and all of them are possibilities this
week. Below, the state of the markets this St George’s Day Monday morning. And
just why do central banks own gold in 2018, if they’re all so certain that the
fiat currencies are “as good as gold.”
Asian Stocks Mixed; Treasury Yields Edge Higher: Markets Wrap
By Adam Haigh
Updated on 23 April 2018, 04:58 GMT+1
Asian stocks were mixed with investors
continuing to assess the outlook for trade discussions and geopolitical
tensions. The dollar held last week’s advance and the 10-year Treasury yield
climbed above 2.97 percent.
The MSCI Asia Pacific Index of stocks
declined, with technology companies among the worst performers after a sell-off
in their U.S. counterparts on Friday. Equity benchmarks fluctuated, struggling
to find direction, while S&P 500 Index futures advanced. The yen dropped
against the dollar, at the start of a week that sees earnings season ramping up
and a slew of economic data from Japan to the U.S. Australian and Japanese bond
yields climbed, matching rises in the U.S.
----With trade dominating discussions
at the IMF gathering in Washington, the spat between the U.S. and China, along
with mounting debt, were cited as threats to the global growth outlook.
Treasury Secretary Steve Mnuchin said he’s “cautiously optimistic” on reaching
an agreement that bridges the differences of the world’s two-largest economies.
Meanwhile, there are signs geopolitical tensions on the Korean peninsula are
easing after Kim Jong Un said he would suspend further tests of atomic bombs
and intercontinental ballistic missiles.
These are some important events coming up this week:
- French President Emmanuel Macron begins a three-day visit to the U.S. Monday
- U.S. manufacturing and services sector PMIs. Later this week’s GDP and jobless claims.
- Earnings season continues. Among those reporting: Alphabet/Google, Microsoft, Amazon.com, Twitter, Samsung, Facebook,SAP,Sony, Caterpillar, Halliburton, Airbus, Daimler, Honda, Deutsche Bank, Barclays, Credit Suisse, UBS, Visa, Nomura, Bank of China, Vale, Statoil, Royal Dutch Shell, Barrick Gold, Total, Exxon Mobil and Chevron.
- European Central Bank has a rate decision on Thursday. While no change to interest rates or the pace of asset purchases is expected, investors will watch for any sign that officials are preparing a shift in stimulus plans for their June meeting.
- Bank of Japan announces its latest policy decision Friday and releases a quarterly outlook report.
more
April 23, 2018 / 5:32 AM
China, Hong Kong stocks dip, tech firms under pressure
SHANGHAI, April 23 (Reuters) - China and
Hong Kong stocks dipped lower on Monday, as tech firms faced pressure amid the
ZTE ban, while investors found some solace on the geopolitical front. ** The
CSI300 index was unchanged at 3,761.78 points at the end of the morning
session, while the Shanghai Composite Index dipped 0.1 percent to 3,068.28. **
The Hang Seng index dropped 0.4 percent to 30,310.22 points, while the Hong
Kong China Enterprises Index lost 0.2 percent to 12,033.22. **
All eyes were on China’s ZTE , which is
seeking a resolution to a U.S. ban on selling it parts and software that it has
said threatens its survival. ** A dozens of fund managers have already cut the
valuations of ZTE shares by more than 20 percent, with some even flagging a 30
percent cut. ZTE stock is halted on the mainland and Hong Kong. **
The ZTE ban came at a time when China and
the United States have threatened each other with tens of billions of dollars
in tariffs in recent weeks, fanning worries of a full blown trade war that
threatens global supply chains as well as business investment plans. ** Tech
stocks were under pressure amid the ZTE woes, with an index tracking IT firms
on the mainland, down more than 2 pct by the lunchbreak, while IT firms dropped
1.3 percent in Hong Kong. **
Leading tech firm BOE Technology plumbed a
seven-month low despite clarifying sanctions reports. ** U.S. Treasury
Secretary Steven Mnuchin said on Saturday he may travel to China, a move that
could ease tensions between the world’s two largest economies, as international
policymakers acknowledged Beijing needs to change its trade practices.
More
In other news, rising political trouble in
Japan adds to Abe's Great Trump Trade War problems. Are India and China ready to
partner?
April 23, 2018 / 4:51 AM
Voter support for Japan's Abe slips amid calls for finance minister to quit
TOKYO (Reuters) - Voter support for
Japanese Prime Minister Shinzo Abe, battered by accusations of cronyism and
other government missteps, slipped in three newspaper surveys published on
Monday, as opposition parties demanded that his finance minister resign.
Abe’s ratings fell three points to 30 percent in a poll by the Mainichi
newspaper. The conservative Yomiuri put his support at 39 percent, also down
three points, while the right-leaning Sankei showed a drop of 6.7 points, to
38.3 percent.
The three results were in contrast to firm backing from a majority in
the business community shown in a Reuters poll.
The sinking public support is dampening Abe’s hopes of winning a third
term as leader of his ruling Liberal Democratic Party (LDP) in a September vote
he must win to stay in office, and has triggered speculation he may step down
sooner.
The surveys were the first since Junichi Fukuda, the finance ministry’s
top bureaucrat, stepped down last week after allegations of sexual harassment
of female journalists, though he denied them.
Opposition parties have increased calls for the resignation of Finance
Minister Taro Aso, a close ally of Abe, after Fukuda quit.
The opposition has threatened not to attend parliamentary debates unless
Aso quits, possibly delaying legislation, including labour reform, that was
watered down after a separate scandal.
About half of voters agree that 77-year-old Aso, who is also deputy
premier, should step down, the two polls showed.
More
April 22, 2018 / 12:35 PM
India's Modi to visit China this week as rapprochement gathers pace
BEIJING (Reuters) - Indian Prime Minister
Narendra Modi will visit China this week for an informal meeting with President
Xi Jinping, as efforts at rapprochement gather pace following a testing year in
ties between the two giant neighbours.
The Chinese government’s top diplomat, State Councillor Wang Yi, said
the two would meet on Friday and Saturday in the central Chinese city of Wuhan.
“Our common interests far outweigh our differences. The two countries
have no choice other than pursuing everlasting friendship, mutually beneficial
cooperation and common development,” Wang told reporters after meeting Indian
Foreign Minister Sushma Swaraj in Beijing.
“The summit will go a long way towards deepening the mutual trust
between the two great neighbours,” he added. “We will make sure that the
informal summit will be a complete success and a new milestone in the history
of China-India relations.”
Modi has sought to re-set ties after disputes over issues including
their disputed border with Tibet and other issues.
More
Finally, is the crude
oil price set to surge in the second half of 2018? And if it does, what does
that do to interest rate normalisation?
Global oil supply surplus may soon become a shortage
Published: Apr 21, 2018 10:25 a.m. ET
Oil prices have rallied so far this year, as OPEC-led efforts have
helped erase a big global surplus, but the market may soon suffer from a new
dilemma: a shortage of crude supplies that would support further price gains.
Stockpiles of the commodity among the industrialized nations that make
up the Organization for Economic Cooperation and Development (OECD) stood at
2.84 billion barrels at the end of February, only 30 million barrels above the
five-year average, according to a monthly report from the International Energy
Agency (IEA).
“The global market has tightened considerably in recent months,” says
Matthew Parry, head of long-term research at research consultancy Energy
Aspects. The Organization of the Petroleum Exporting Countries is “very close
to achieving its originally stated aim of bringing OECD stocks back to parity
with their five-year average.”
“What we are seeing happening, and will occur much more frequently going
forward, is that one-off [supply issues or threats] will start to have a more
pronounced impact upon prices,” says Parry.
When OPEC reached an agreement in late 2016 with some major non-OPEC
producers, including Russia, to curb production, stocks were at roughly 348
million barrels above the five-year average, he says.
OPEC member Saudi Arabia has led the way, curbing supplies by around 0.7
million barrels a day between the third quarter of 2016 and the first quarter
of this year, says Parry. Overall, “much of the adjustment isn’t really a
deliberate supply-cutting effort, but geopolitical troubles that forced
supplies down,” such as the 0.6 million barrel a day contraction in supplies
over this period from Venezuela, which suffers from an economic crisis, or
“problems with aging wells naturally depleting, such as those that have
impacted Angola and China.”
Still, OPEC wouldn’t have achieved its goal without the recent strength
in demand world-wide, says Parry. He views the supply drawdown as “largely a
consequence” of stronger-than-expected demand.
For the past couple of months, the IEA has underestimated global demand,
with its first-quarter 2018 estimate at 98.1 million barrels a day–which is
likely about 0.3 million barrels a day short of true global demand, according
to Parry.
More
Hedge-Fund Investors Pour Into Oil as Firms Predict Surge to $80
By Suzy Waite
Updated on 23 April 2018, 00:00 GMT+1
Hedge funds investing in oil are luring capital at the fastest pace in more
than a year.With crude climbing to levels not seen since 2014, commodity funds have recovered the client outflows they suffered last year. And if firms such as Westbeck Capital Management and Commodities World Capital are correct about prices soon exceeding $80 a barrel from about $68 currently, then the jump in allocations may just the beginning.
Until Friday everything seemed to point to oil extending its gains, with confidence in the global economy building and geopolitical tensions and production shortages showing no signs of going away. Then U.S. President Donald Trump slammed OPEC on Twitter, saying prices are artificially high and will not be accepted. Prices slipped 19 cent a barrel.
Still, these funds are “desirable in times of expected market
volatility” and will probably continue to see inflows in 2018, said Peter
Laurelli, global head of research at data provider eVestment.
Investors allocated $3 billion to commodity-focused hedge funds from
January through March, the most since the third quarter of 2016, according to
eVestment. Last year they pulled $680 million from the strategy in the first
net outflows since 2014.
More
Below, the reason our
fatally flawed central banksters cling on to central bank gold.
"Regardless of the dollar price involved, one ounce of gold would purchase a good-quality man's suit at the conclusion of the Revolutionary War, the Civil War, the presidency of Franklin Roosevelt, and today."
Peter A. Burshre
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally doubled over.
Yes, Tesla again. Is Tesla following the US Postal Service model? Is
Tesla running out of cash and talent?
Tesla Quietly Raised the Price of the Powerwall
That’s not what usually happens when you scale up mass production.
Julian SpectorApril 19, 2018
Tesla now charges more for its Powerwall than it did back when the product
launched in October 2016.The company's website now lists the starting price for the 7-kilowatt/13.5-kilowatt-hour storage system as $5,900 — a $400 increase from the original list price of $5,500. The actual price to a customer will be higher still, because it includes supporting hardware, installation and other fees.
The $5,900 rate applies to new orders; orders placed before February 22 will have the previous pricing, a Tesla spokesperson clarified by email Thursday.
"Tesla evaluates its global pricing of energy products based on various factors and continues to make improvements that will simplify homeowner experience," the spokesperson noted. "Powerwall continues to provide great value for customers and installers."
Conventional wisdom in the industry has held that energy storage prices will fall as battery manufacturing scales up. Indeed, the Powerwall 2 debuted at a price point 40 percent cheaper than its predecessor, based on energy capacity.
Since the Powerwall 2 launch, Tesla has had a year and a half to increase its manufacturing capabilities. Battery prices have fallen by double-digit percentages annually. Analysts suggest future demand for electric vehicles could create scarcity for battery materials like cobalt, counteracting battery price declines, but that's still a ways off.
The Powerwall price hike, then, cuts against the grain of broader energy storage industry trends.
This is not the first time that Tesla has revised its battery offerings without fanfare.
Greentech Media reported in March 2016 that Tesla had quietly discontinued its longer-duration Powerwall model, which was intended to target customers looking for backup power. The company said at the time that it had decided to focus exclusively on its shorter-duration product for daily cycling. It scrubbed the backup model from its online presence.
Even Tesla's competitors concede that the company catalyzed public awareness of what energy storage can do. It also cemented a reputation for the lowest home battery pricing, leveraging the in-house supply chain built for its electric vehicle business to offer price points that make competing products look like luxury items.
It's not clear which "various factors" drove the decision to charge more.
The actual cost to build a storage product remains a jealously guarded secret. It's possible that Tesla chose to prioritize market share initially with a low price, and bank on increasing margins when its production costs came down. In that scenario, the choice to raise the list price could reflect an adjustment of the relationship between the cost to build a Powerwall and its end price.
Or the company might just need more cash.
More
Technology Update.
With events happening fast in the
development of solar power and graphene, I’ve added this section. Updates as
they get reported. Is converting sunlight to usable cheap AC or DC energy
mankind’s future from the 21st century onwards?
Graphene sets a new record on squeezing light to one atom
Date:
April 20, 2018
Source:
Graphene Flagship
Summary:
Researchers reach the ultimate level of light confinement -- the space of one
atom. This will pave the way to ultra-small optical switches, detectors and
sensors.
In a recent study published in Science, researchers at ICFO --
The Institute of Photonic Sciences in Barcelona, Spain, along with other
members of the Graphene Flagship, reached the ultimate level of light
confinement. They have been able to confine light down to a space one atom, the
smallest possible. This will pave the way to ultra-small optical switches,
detectors and sensors.
Light can function as an ultra-fast communication channel, for example
between different sections of a computer chip, but it can also be used for
ultra-sensitive sensors or on-chip nanoscale lasers. There is currently much
research into how to further shrink devices that control and guide light.
New techniques searching for ways to confine light into extremely tiny
spaces, much smaller than current ones, have been on the rise. Researchers had
previously found that metals can compress light below the wavelength-scale
(diffraction limit), but more confinement would always come at the cost of more
energy loss. This fundamental issue has now been overcome.
"Graphene keeps surprising us: nobody thought that confining light
to the one-atom limit would be possible. It will open a completely new set of
applications, such as optical communications and sensing at a scale below one
nanometer," said ICREA Professor Frank Koppens at ICFO -- The Institute of
Photonic Sciences in Barcelona, Spain, who led the research.
----Professor
Andrea C. Ferrari, Science and Technology Officer of the Graphene Flagship, and
Chair of its Management Panel, added "While the flagship is driving the
development of novel applications, in particular in the field of photonics and
optoelectronics, we do not lose sight of fundamental research. The impressive
results reported in this paper are a testimony to the relevance for cutting
edge science of the Flagship work. Having reached the ultimate limit of light
confinement could lead to new devices with unprecedented small
dimensions."
More
"The gold standard makes the money's purchasing power independent of the changing, ambitions and doctrines of political parties and pressure groups. This is not a defect of the gold standard; it is its main excellence."
Ludwig von Mises
The monthly Coppock Indicators finished March.
DJIA: 24,103 +272 Down
10. NASDAQ: 7,063 +300 Down 13. SP500: 2,641 +202 Down 10.
All
three slow indicators moved down in March. For some a new bear signal, for
others a take profits and get back to cash signal.
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