Baltic Dry Index. 2403 -22 Brent Crude 108.11
Spot Gold 1904
Coronavirus Cases 02/04/20 World 1,000,000
Deaths 53,100
Coronavirus Cases 28/04/22 World 512,254,927
Deaths 6,256,570
May you live in interesting times.
Alleged Chinese curse.
It is the last trading day of the month, time to dress up stocks and the indexes. But did Amazon and Apple just spoil the party?
Despite all that extra oil promised by President Biden from the strategic reserve, the crude oil price is staying stubbornly above 100 dollars.
That US GDP report, though ignored for now, didn’t help either. I suspect it will not be ignored for long, not with the Fed raising interest rates from next week.
An interesting day ahead.
Global shares rise as earnings boost, U.S. dollar hits 20-year high
April 28, 2022 10:17 PM GMT+1
WASHINGTON/LONDON, April 28 (Reuters) - The U.S. dollar touched a two-decade high against rivals on Thursday, as Wall Street rallied and European shares rose from six-week lows with strong earnings reports offseting gloomy U.S. economic data.
The yen dropped to a 20-year low after the Bank of Japan vowed to buy unlimited amounts of 10-year bonds daily to defend its yield target. The bank's strengthening of its commitment to ultra-low interest rates sent the U.S. dollar to a fresh high, weakened emerging market currencies and pushed borrowing costs for U.S. dollars in currency derivatives markets sharply higher. read more
Oil prices settled higher on the increased likelihood that Germany will join other European Union member states in an embargo on Russian oil, which could further tighten supplies in the already-stressed global crude market.
The S&P 500 (.SPX) climbed 2.47% to end the session at 4,287.50 points. The Nasdaq (.IXIC) gained 3.06% to 12,871.53 points, while Dow Jones Industrial Average (.DJI) rose 1.85% to 33,916.39 points.
Technology stocks gained on strong earnings. Shares of Facebook parent Meta Platforms Inc (FB.O) surged after the company reported a larger-than-expected profit on Wednesday.
Apple Inc (AAPL.O), the world's most valuable company, and e-commerce giant Amazon.com Inc (AMZN.O) both rallied ahead of their quarterly reports, though Amazon tumbled about 10% in extended trade after the company forecast current-quarter sales below estimates. read more
The tech sector gains supported Wall Street even after the U.S. Commerce Department said in its advance GDP estimate that gross domestic product fell at a 1.4% annualized rate last quarter. read more
More
https://www.reuters.com/business/global-markets-wrapup-1-2022-04-28/
U.S. GDP fell at a 1.4% pace to start the year as pandemic recovery takes a hit
Gross domestic product unexpectedly declined at a 1.4% annualized pace in the first quarter, marking an abrupt reversal for an economy coming off its best performance since 1984, the Commerce Department reported Thursday.
The negative growth rate missed even the subdued Dow Jones estimate of a 1% gain for the quarter, but the initial estimate for Q1 was the worst since the pandemic-induced recession in 2020. GDP measures the output of goods and services in the U.S. for the three-month period.
Despite the disappointing number, markets paid little attention to the report, with stocks and bond yields both mostly higher. Some of the GDP decline came from factors likely to reverse later in the year, raising hopes that the U.S. can avoid a recession.
“In retrospect, this could be seen as a pivotal report,” said Simona Mocuta, chief economist at State Street Global Advisors. “It reminds us of the reality that growth has been great, but things are changing and they won’t be that great going forward.”
A plethora of factors conspired to weigh against growth during the first three months of 2022, which fell off a cliff following the 6.9% gain to close out last year.
More
https://www.cnbc.com/2022/04/28/us-q1-gdp-growth.html
Japan escalates warnings as yen slumps, vows to take 'appropriate action'
April 28, 2022 11:18 AM GMT+1
TOKYO, April 28 (Reuters) - Japan will take appropriate action in currency markets as recent moves are "extremely worrying," a finance ministry official said on Thursday, issuing Tokyo's strongest warning yet as the yen plunged to fresh 20-year lows.
The remark highlights growing alarm among Japanese policymakers over the rapid decline in the currency, which Bank of Japan (BOJ) Governor Haruhiko Kuroda warned could hurt the economy. read more
----The yen recouped some losses after the comments, which came after it briefly fell to 130.7 against the dollar.
Markets are focusing on whether Tokyo may intervene in the currency market to prop up the yen during Japan's holiday-studded Golden Week that kicks off on Friday.
The U.S. Federal Reserve is set to raise interest rates at its policy meeting next week, which could further weaken the yen against the dollar as investors focus on prospects of widening U.S.-Japan interest rate differentials.
Column: 'Peak subscription' a red flag for U.S. economy and markets
April 28, 2022 1:05 AM GMT+1
ORLANDO, Fla., April 27 (Reuters) - U.S. consumers appear to have online subscription and streaming fatigue, a lethargy that may be a reflection of where the wider economy is heading.
Soaring inflation and the resulting 'real' income squeeze is forcing consumers to rethink spending habits and one of the most explosive trends of the COVID lockdown era is in danger of reversing.
Netflix (NFLX.O) raised a red flag last week, announcing that subscriptions fell in the first quarter for the first time ever. It also warned that the slide could accelerate. read more
Then Warner Bros Discovery (WBD.O) shut its CNN+ streaming service less than a month after it launched, after it reportedly attracted as few as 10,000 viewers a day. read more
Figures from Truebill, a personal finance app that helps some 2.5 million customers manage and cancel recurring charges, show that the average number of cancellations outpaced new subscriptions last July for the first time since the company was founded in 2015.
The trend is accelerating. In March new subscriptions were 4.4% of total subscriptions, down from 7% a year earlier, and 10.4% of subscriptions were canceled, almost double the 5.6% from a year earlier.
"People are tightening the purse strings and being more selective about where they spend their money," Yahya Mokhtarzada, Truebill's chief revenue officer, told Reuters. "We may have hit peak subscription."
And Americans subscribed to a lot of online services during pandemic lockdowns - anything from work-related software to language learning or video streaming and entertainment apps.
With household savings for those able to work from home boosted by restrictions on travel, mass events and socializing, incremental small monthly subs for multiple online distractions were easily absorbed.
A survey of 1,030 adults of varying ages by Wethrift.com in January showed that 96% of people had at least one video-streaming service, 80% had a music-streaming subscription, followed by meal-kit delivery services at 57%; beauty, health, and wellness at 51%, and 56% that didn't fit a category.
But with workplaces, entertainment and travel gradually returning to some semblance of normality, and household savings being burnt off by energy and food price spikes, many people are pruning back their bloated direct debit lists.
More
https://www.reuters.com/markets/europe/peak-subscription-red-flag-us-economy-markets-2022-04-27/
Amazon results and outlook fall short as warehouse, fuel costs soar
April 28, 2022 11:44 PM GMT+1
April 28 (Reuters) - Amazon.com Inc (AMZN.O) delivered a disappointing quarter and outlook on Thursday as the e-commerce giant was swamped by higher costs to run its warehouses and deliver packages to customers.
Shares fell 9% in after-hours trade.
After a long-running surge in sales during the COVID-19 pandemic, Amazon is facing a litany of challenges. The company's expenses swelled as it offered higher pay to attract workers. A fulfillment center in New York City voted to create Amazon's first U.S. union, a result the retailer is contesting. And the higher price of fuel risks diminishing consumers' disposable income just as it is making delivery more expensive for Amazon, the world's biggest online retailer.
More
https://www.reuters.com/technology/amazon-forecasts-second-quarter-sales-below-estimates-2022-04-28/
Apple sees bigger supply problems after strong start to year
April 29, 2022 1:41 AM GMT+1
OAKLAND, Calif., April 28 (Reuters) - Apple Inc (AAPL.O) on Thursday forecast bigger problems as COVID-19 lockdowns snarl production and demand in China, the war in Ukraine dents sales and growth slows in services, which the iPhone maker sees as its engine for expansion.
Shares were down 2.2% in late trade after executives laid out their glum outlook on a conference call. The news outweighed record profit and sales for Apple's fiscal second quarter, which ended in March.
Chief Financial Officer Luca Maestri warned in an interview that the war in Ukraine, which led Apple to stop sales in Russia, would cut sales more deeply in the fiscal third quarter.
He told analysts on the call that supply-chain issues would hurt sales in the quarter by $4 billion to $8 billion, "substantially larger" than the hit in the second quarter.
Supply problems were focused on a corridor in Shanghai, China and reflected COVID disruptions and chip shortages, he added. The pandemic was also affecting demand in China, he said.
Chief Executive Officer Tim Cook said that almost all of the Chinese factories doing final assembly of Apple products had restarted after recent COVID shutdowns, but the company is not forecasting when the chips shortage, mostly affecting older products, would end.
Cook said he hoped COVID issues would be "transitory" and "get better over time."
At least one analyst said the outlook lacked clarity.
More
In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value.
Alan Greenspan
Global Inflation/Stagflation Watch.
Given our Magic Money Tree central banksters and our spendthrift politicians, inflation now needs an entire section of its own.
Unilever warns of more price hikes as cost pressures build
April 28, 2022 9:54 AM GMT+1
· Q1 underlying sales up 7.3% vs forecast up 4.4%
· Q1 prices up 8.3%, volumes down 1%
· Raises H2 cost inflation forecast to 2.7 bln euros
April 28 (Reuters) - Unilever (ULVR.L) raised prices by over 8% in the first quarter and warned more hikes were on the way as the maker of Dove soap and Ben & Jerry's ice cream lifted its cost inflation forecast for the second half of the year due to the Ukraine conflict.
The company said it now expected cost inflation would reach 2.7 billion euros ($2.8 billion) in July-December, up sharply from its previous estimate of 1.5 billion.
Consumer goods makers around the world are lifting prices to make up for soaring energy, commodities, labour and transport costs, with the Ukraine conflict exacerbating inflationary pressures already building in the recovery from the pandemic.
Unilever reported a 1% dip in first quarter sales volumes, and some analysts are worried this is an early sign that cash-strapped consumers are switching to cheaper own brands.
"As far as pricing and volumes, I think we are in unchartered territory," Chief Executive Alan Jope said on an earnings call. "While we're acutely aware of the pressure on consumers, we believe that increasing prices in response to this extreme commodity cost pressure is the right thing to do."
Analysts said prices were only going to go higher.
Unilever's full-year costs "are going to quadruple versus a year ago. That's why the pricing needs to be so high, and that's why the price is going to go much higher," Barclays' Warren Ackerman said. "This is not the peak."
"The worry is what will happen to volumes when pricing goes up more?"
In the first quarter, Unilever hiked prices the most in Latin America - by 16.4% - and in other emerging markets.
More
https://www.reuters.com/business/unilever-posts-73-rise-first-quarter-underlying-sales-2022-04-28/
Indonesia suspends all exports of palm oil
Issued on: 28/04/2022 - 07:56
Jakarta (AFP) – Indonesia began imposing a complete ban on palm oil exports Thursday, as the world's largest producer of the commodity risked destabilising a global vegetable oil market already hitting peak prices.
The archipelago nation is facing a domestic shortage of cooking oil as well as soaring prices, with consumers in several cities having to queue for hours in front of distribution centres to buy the essential commodity at subsidised rates.
Authorities in Southeast Asia's most populous country fear the scarcity and rising costs could provoke social tensions and have moved to secure supplies of the product, which is used in a range of goods such as chocolate spreads and cosmetics.
In a last-minute reversal late Wednesday, they clarified the embargo would include all exports of the oilseed and not only products intended for edible oils, as indicated a day earlier.
"All products," including crude palm oil, "are covered by the Ministry of Trade regulation and will be enforced," said Coordinating Minister for Economic Affairs Airlangga Hartarto.
President Joko Widodo said supplying the country's 270 million residents was his government's "highest priority".
"As the world's largest palm oil producer, it is ironic that we are having difficulties getting cooking oil," he said.
Indonesia produces about 60 percent of the world's palm oil, with one-third consumed by its domestic market. India, China, the European Union and Pakistan are among its major export customers.
The months-long shortage has been exacerbated by poor regulation and reluctance among producers to sell at home due to high international prices that have made exports more profitable.
Jakarta plans to resume exports when the price of bulk cooking oil in local markets has fallen to 14,000 rupiah (97 cents) per litre, having rocketed 70 percent in recent weeks to 26,000 rupiah ($1.80).
Vegetable oils are among a number of staple food items that have seen prices hit record highs in recent weeks, following Russia's invasion of agricultural powerhouse Ukraine, according to the United Nations Food and Agriculture Organisation.
More
https://www.france24.com/en/live-news/20220428-indonesia-suspends-all-exports-of-palm-oil-1
Indonesia navy seizes 2 tankers carrying palm oil
April 28, 2022 7:54 AM GMT+1
AKARTA, April 28 (Reuters) - Indonesia's navy seized two tankers carrying crude palm oil, palm olein and methanol for what it said were permit and paperwork violations, in an operation conducted a day before a palm oil export ban took effect, it said on Thursday.
MT World Progress violated vessel specifications in its travel document, while the other ship, MT Annabelle carried methanol without a permit, said the navy, which has been deployed to enforce the export ban, which took effect midnight Wednesday.
MT World Progress was traveling from Dumai on Sumatra island towards India carrying 34,854.3 tonnes of palm olein, while MT Annabelle was seized off Borneo island, heading to Shajrah in the United Arab Emirates, the statement said.
Below, why a “green energy” economy may not be possible, and if it is, it won’t be quick and it will be very inflationary, setting off a new long-term commodity Supercycle. Probably the largest seen so far.
The “New Energy Economy”: An Exercise in Magical Thinking
https://media4.manhattan-institute.org/sites/default/files/R-0319-MM.pdf
Mines, Minerals, and "Green" Energy: A Reality Check
https://www.manhattan-institute.org/mines-minerals-and-green-energy-reality-check
"An Environmental Disaster": An EV Battery Metals Crunch Is On The Horizon As The Industry Races To Recycle
by Tyler Durden Monday, Aug 02, 2021 - 08:40 PM
Covid-19 Corner
This section will continue until it becomes unneeded.
China megacity mass-tests, cancels flights after suspected Covid case
Issued on: 28/04/2022 - 07:30
Beijing (AFP) – The Chinese megacity of Guangzhou cancelled hundreds of flights Thursday and launched mass testing of 5.6 million people after one suspected Covid case, as the battle to contain the coronavirus sweeps across the country.
China is facing its worst outbreak since the peak of the first wave in early 2020, with eastern Shanghai recording dozens of daily deaths and the capital Beijing sealing off whole neighbourhoods where handfuls of cases have been detected.
Under its zero-Covid policy, China has used lockdowns, mass testing and travel restrictions to stamp out infections.
The strategy is under strain, with the highly transmissible Omicron variant punching through health controls.
Rolling virus restrictions -- including a weeks-long lockdown of virtually all of Shanghai's 26 million residents -- have damaged the economy, causing backlogs at the world's busiest container port, a key node in the global supply chain.
On Thursday, Guangzhou, a major trade and manufacturing hub in southern China, announced mass testing for almost a third of its near 19 million residents after an "abnormal" test result was detected at its airport, where most flights have been cancelled.
Meanwhile, the tech hub of Hangzhou near Shanghai late on Wednesday ordered 9.4 million downtown residents out of its 12.2 million population to get tested every 48 hours if they want to access public spaces and transportation.
The aim is "that the virus has nowhere to hide or settle", the city government said in a statement, raising fears of further restrictions across a city home to some of China's biggest companies.
China reported 11,367 new infections on Thursday, a small daily tally compared with most major global economies, but enough to rattle authorities in the country where the coronavirus was first detected in late 2019, but that had until recently emerged relatively unscathed by the pandemic.
Over 10,000 of those cases were detected in Shanghai, where cases are trending downwards after a weeks-long lockdown which has enraged residents and seen rare protests against a government accused of bungling the response and failing to feed people confined at home.
The city is waging a campaign to reach "zero-Covid at the community level" -- meaning no transmissions outside locked-down areas.
In recent days, more housing compounds have lifted movement restrictions and authorities on Thursday said 90 percent of new infections were found in quarantined areas.
Around 50 new cases were found in Beijing, the seat of government for President Xi Jinping, who has until now hailed China's virus response as an example of the superiority of the country's Communist leadership.
The capital launched mass testing of nearly all its 21 million residents this week and locked down more housing compounds in its populous Chaoyang district Thursday.
Residents are on high alert of a potential wider lockdown, with large gatherings, group travel and weddings suspended and some schools moving online.
Taiwan faces largest COVID-19 outbreak yet
TAIPEI, Taiwan (AP) — Taiwan, which had been living mostly free of COVID-19, is now facing its worst outbreak since the beginning of the pandemic with over 11,000 new cases reported Thursday.
Cases have been on the upswing since late March. In April, the island’s central authorities announced that they would no longer maintain a “zero-COVID” policy like the Chinese government’s in which they would centrally quarantine positive cases.
Instead, the government is asking people to quarantine at home if they test positive, unless they show moderate to severe symptoms.
Chen Shih-chung, the island’s health minister, announced Thursday they had found 11,353 new cases, along with two deaths. During the daily press briefing held by the Central Epidemic Command Center, he said 99.7% of the cases in the current outbreak either had no symptoms or had mild symptoms.
----Most of Taiwan’s 858 COVID-19 deaths came from summer 2021. Until this month, it had been the island’s one major outbreak in the pandemic.
Taiwan has been relatively lucky throughout the pandemic, but also has maintained strict border controls with a two-week quarantine on arrival required for all visitors.
Domestically, mask wearing is universal both outdoors and indoors. Masks are legally required on public transportation and in places like shops and theaters.
In the past few weeks, as cases have ratcheted up, people scrambled to buy up rapid tests with stores selling out in just a few hours. Convenience stores across Taipei were unsure where their next delivery would come from.
Difficulty buying rapid tests is likely due in part to the government’s thought throughout the pandemic that there are few benefits to mass testing. The health minister last year said that public funds and medical resources could better be used elsewhere.
That changed with last year’s outbreak.
The central government this month said it would work with Taiwanese companies who manufacture tests to ensure that everyone would have access. A system was rolled out Thursday that limits each person to buying one pack of five tests per trip. Each purchase must be linked to an individual’s national ID to ensure that there is no stockpiling.
More
https://apnews.com/article/covid-business-health-asia-taiwan-f46f2cff5593fcbbc0ce9923b0e62fe8
Next, some vaccine links kindly sent along from a LIR reader in Canada.
NY Times Coronavirus Vaccine Tracker. https://www.nytimes.com/interactive/2020/science/coronavirus-vaccine-tracker.html
Regulatory Focus COVID-19 vaccine tracker. https://www.raps.org/news-and-articles/news-articles/2020/3/covid-19-vaccine-tracker
Some other useful Covid links.
Johns Hopkins Coronavirus resource centre
https://coronavirus.jhu.edu/map.html
Rt Covid-19
Centers for Disease Control Coronavirus
https://www.cdc.gov/coronavirus/2019-ncov/index.html
The Spectator Covid-19 data tracker (UK)
https://data.spectator.co.uk/city/national
Technology Update.
With events happening fast in the development of solar power and graphene, among other things, I’ve added this section. Updates as they get reported.
Disposable masks could be used to improve concrete
Date: April 27, 2022
Source: Washington State University
Summary: With the pervasive single-use masks during the pandemic now presenting an environmental problem, researchers have demonstrated the idea of incorporating old masks into a cement mixture to create stronger, more durable concrete.
With the pervasive single-use masks during the pandemic now presenting an environmental problem, researchers have demonstrated the idea of incorporating old masks into a cement mixture to create stronger, more durable concrete.
In a paper published in the journal, Materials Letters, a Washington State University research team showed that the mixture using mask materials was 47% stronger than commonly used cement after a month of curing.
"These waste masks actually could be a valuable commodity if you process them properly," said Xianming Shi, professor and interim chair of the Department of Civil and Environmental Engineering and the corresponding author on the paper. "I'm always looking out for waste streams, and my first reaction is 'how do I turn that into something usable in concrete or asphalt?'"
Production of cement is a carbon-intensive process, responsible for as much as 8% of carbon emissions worldwide. Microfibers are already sometimes added to cement concrete to strengthen it, but they're expensive. The microfiber-reinforced concrete can potentially reduce the amount of cement needed for a project or make the concrete last longer, saving carbon emissions as well as money for builders and owners.
Made of a polypropylene or polyester fabric where it contacts the skin and an ultra-fine polypropylene fiber for the filtering layers, medical masks have fibers that can be useful for the concrete industry. If they are not reused, disposable masks can remain in the environment for decades and pose a risk for the ecosystem.
"This work showcases one technology to divert the used masks from the waste stream to a high-value application," Shi said.
In their proof-of-concept work, the researchers developed a process to fabricate tiny mask fibers, ranging from five to 30 millimeters in length, and then added them to cement concrete to strengthen it and to prevent its cracking. For their testing, they removed the metal and cotton loops from the masks, cut them up and incorporated them into ordinary Portland cement, the most common type of cement used around the world and the basic ingredient for concrete, mortar and grout.
They mixed the mask microfibers into a solution of graphene oxide before adding the mixture to cement paste. The graphene oxide provides ultrathin layers that strongly adhere to the fiber surfaces. Such mask microfibers absorb or dissipate the fracture energy that would contribute to tiny cracks in the concrete. Without the fibers, these microscopic cracks would eventually lead to wider cracks and the material's failure.
The researchers are conducting more studies to test their idea that the graphene oxide-treated microfibers could also improve the durability of the concrete and protect it from frost damage and from deicing chemicals that are used on roadways. They also envision applying this technology to the recycling of other polymer materials, such as discarded clothing, to incentivize the collection of such waste.
Zhipeng Li, a graduate student in WSU's Department of Civil and Environmental Engineering, led the work, which was funded through the U.S. Department of Transportation's National Center for Transportation Infrastructure Durability and Life Extension.
Another weekend and a holiday weekend in most of Europe, though not in war torn Ukraine probably. For Ukraine, Russia, Europe and those parts of the world relying on Ukraine’s food exports, it looks like being a lose all round war. Sadly, the longer it goes on the more likely it is to widen into a much worse war, though no one seems to care. Have a great weekend everyone.
A U.S. dollar is an IOU from the Federal Reserve Bank. It's a promissory note that doesn't actually promise anything. It's not backed by gold or silver.
P. J. O'Rourke.
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