Wednesday, 28 February 2024

Stocks Pause. Oil Rises. US Yield Curve Flattening.

 Baltic Dry Index. 1899 +28             Brent Crude  83.33

Spot Gold 2031                    US 2 Year Yield 4.70 +0.01

Rashness succeeds often, still more often fails.

Napoleon Bonaparte.

In the stock casinos, a pause or something more?

With month-end tomorrow, normally insiders and the money manager pros are busy dressing up stocks for their all important performance bonuses. Why not this week?

Could it be that they’ve noticed that the inverted US yield curve is flattening, often, usually, a sign of imminent US recession?

Just why are so many stock insiders massively now dumping stocks for cash?

 

Morning Bid: Calm prevails before inflation data, kiwi stirs

February 28, 20245 :41 AM GMT

A look at the day ahead in European and global markets from Ankur Banerjee

An eerie calm is pervading global markets as traders await new inflation tests later in the week, which will give the next clues on closely watched rate outlooks in the U.S. and Europe.

There were pockets of excitement in the Asian day, however, as New Zealand's central bank hinted at a slightly less hawkish stance while South Korean shares kept up this month's relentless rally.

The U.S. inflation reading is due on Thursday while the euro zone will weigh in on Friday, and both are expected to dominate market action. Caution will be the driving force in the meantime, with futures indicating a muted open today for European bourses.

Traders did get a shock early in the day when the Reserve Bank of New Zealand trimmed its projected policy path for future rates.

That was enough to spark a rally in New Zealand bonds, as markets sharply scaled back the risk of further hikes, as well as a 1% dip in the Kiwi to its lowest in nearly two weeks.

Asian shares outside Japan (.MIAPJ0000PUS) opens new tab were a tad lower, while the Nikkei (.N225) opens new tab was taking a breather after scaling record peaks and closing in on its next target at 40,000.

South Korean stocks (.KS11) opens new tab are on a tear, up 1% on the day and about 6% in February, lifted by the AI frenzy and authorities' moves this week to boost shareholder returns and reduce the "Korea discount".

Earnings at Reckitt Benckiser (RKT.L) opens new tab, maker of Dettol and Lysol cleaning products, are the main event on the corporate diary, with a focus on how consumer demand is faring in the face of rising prices.

Two of the world's top consumer goods companies, Danone and Nestle, said last week they would slow the pace of price increases this year, after two years of hikes led many shoppers to seek cheaper alternatives.

The M&A chase for Britain's Currys (CURY.L) opens new tab heats up after the electrical retailer rejected an improved 757 million pound ($959 million) bid from U.S. investor Elliott Advisors. China-based online retailer JD.com (9618.HK) opens new tab has said it is also considering an offer.

Key developments that could influence markets on Wednesday:

Economic events: Feb euro zone economic, industrial and services sentiment as well as euro zone consumer confidence for Feb

Earnings: Reckitt Benckiser (RKT.L)

Morning Bid: Calm prevails before inflation data, kiwi stirs | Reuters

 

Asia-Pacific markets mostly lower; Hong Kong property stocks rally on budget announcement

UPDATED TUE, FEB 27 2024 11:13 PM EST

Asia-Pacific stock markets were mostly lower Wednesday as New Zealand’s central bank kept its interest rate steady, while Hong Kong’s property index rallied after the city’s budget announcement.

Hong Kong said it would do away with property curbs in an effort to buoy its real estate sector. Financial Secretary Paul Chan said he expected the economy to grow in a range of 2.5% to 3.5% this year.

Hong Kong’s Hang Seng index dipped 0.2%, while the Hang Seng Property index jumped nearly 2%.

The Reserve Bank of New Zealand held its official cash rate at 5.50%, keeping it at a 15-year high, while warning that inflation remained well above its target range.

China’s manufacturing purchasing managers’ index reading and the U.S. personal consumption expenditures price index — the Federal Reserve’s preferred inflation gauge — are due Thursday.

Australia’s S&P/ASX 200 was flat, while New Zealand’s benchmark S&P/NZX 50 index rose 0.5% after the RBNZ decision.

The CSI 300 index fell 0.3%.

Japan’s Nikkei 225 was flat and the broader Topix inched 0.1% higher. The Nikkei 225 had hit a record high earlier in the week.

South Korea’s Kospi rose nearly 1%, rising after two straight days of declines. The smaller-cap Kosdaq added 1.2%.

The S&P 500 and the Nasdaq Composite ended Tuesday with small gains as investors awaited key inflation data to be released later this week.

The S&P 500 inched up 0.17%, while the Nasdaq added 0.37%. The Dow Jones Industrial Average fell 96.82 points, or 0.25%.

Asia markets fall, New Zealand central bank holds rate steady (cnbc.com)

Stock futures inch lower Tuesday night as investors await fresh inflation data: Live updates

UPDATED TUE, FEB 27 2024 7:50 PM EST

Stock futures ticked lower on Tuesday evening as investors looked ahead to a key inflation report due later this week.

Futures tied to the Dow Jones Industrial Average slipped 40 points, or 0.1%. S&P 500 futures pulled back 0.04%, while Nasdaq 100 futures slid 0.09%.

In after-hours trading, online marketplace eBay jumped more than 3% after announcing that it was raising its quarterly dividend and would spend an additional $2 billion on buybacks. Urban Outfitters lost 10% after missing estimates on the top and bottom lines in the fourth quarter.

In Tuesday’s regular session, the S&P 500 and the Nasdaq Composite ended the day with small gains, up 0.17% and 0.37%, respectively. The 30-stock Dow fell for a second straight day, off by 0.25%.

The S&P 500 and the Dow are off the highs they just notched late last week, but investors may want to think twice before they aggressively ramp up on equities.

“I just don’t think you chase at this point,” Drew Pettit, director of U.S. equity strategy at Citi, said on CNBC’s “Closing Bell: Overtime.” “A lot of good news is getting priced in – we are actually trading up even though the reporting season really hasn’t been great; we really haven’t had a lot of broad beats and broad raises.”

More

Stock market today: Live updates (cnbc.com)

Finally, more on so you really, really, really want to own an EV. (Do/can EVs have turbos?)


Porsche Taycan Turbos Have Lost Up To $100,000 Value In 4 Years

This high-performance, German EV has taken a big drop in value

February 23, 2024

Depreciation is hitting EVs harder than most other vehicles. A combination of technology upgrades, price fluctuations on new cars, and lack of demand has meant a rapid drop in value for many electric models. This phenomenon is especially dramatic for Porsche’s Taycan EV, with high-spec Turbo models losing almost $100,000 in value within four years.

The Porsche Taycan, first launched in 2019, was to be the German automaker’s attempt to take on the super popular Tesla Model S. While the Taycan offered solid build quality and a driving experience that you would expect from the maker of some legendary sports cars, the EV model was expensive. Porsche decided to launch the model with the top-of-the-range Turbo and Turbo S versions with starting prices of $151,000 and $185,000 respectively, and that is before you start checking off all the option boxes. Porsche later expanded the model range to include more “reasonably” priced models from the base Taycan to the 4S, and GTS trims. Buyers could even opt for the SportTurismo wagon body style.

There is an updated Taycan on its way for 2025 that will provide even more power and faster charging, but this upgrade comes at a price with MSRPs starting at $101,395 for a “base” spec all the way up to the Turbo S Sport Turismo with a sticker price of $213,695. But even if you have that kind of cash, a savvy shopper for a six-figure performance EV should look into the pre-owned market because they could save serious money.

Here is a sampling of three-to-four-year-old Taycaon Turbo and Turbo S models that illustrate the massive depreciation.

----Here we have a Porsche Certified 2020 Turbo with just under 15,000 miles with a current asking price of $89,998 and an original MSRP of $179,630. That’s a drop of $89,632

Porsche Taycan Turbos Have Lost Up To $100,000 Value In 4 Years (jalopnik.com)

Apple to Wind Down Electric Car Effort After Decadelong Odyssey

February 27, 2024

(Bloomberg) -- Apple Inc. is canceling a decadelong effort to build an electric car, according to people with knowledge of the matter, abandoning one of the most ambitious projects in the history of the company.

Apple made the disclosure internally Tuesday, surprising the nearly 2,000 employees working on the project, said the people, who asked not to be identified because the announcement wasn’t public. The decision was shared by Chief Operating Officer Jeff Williams and Kevin Lynch, a vice president in charge of the effort, according to the people. 

The two executives told staffers that the project will begin winding down and that many employees on the car team — known as the Special Projects Group, or SPG — will be shifted to the artificial intelligence division under executive John Giannandrea. Those employees will focus on generative AI projects, an increasingly key priority for the company.

More

Apple to Wind Down Electric Car Effort After Decadelong Odyssey (msn.com)

Global Inflation/Stagflation/Recession Watch.

Given our Magic Money Tree central banksters and our spendthrift politicians, inflation now needs an entire section of its own.

Japan's inflation beats forecasts, end of negative rates in sight

By Tetsushi Kajimoto and Takahiko Wada

TOKYO, Feb 27 (Reuters) - Japan's core consumer inflation slowed for a third straight month in January but beat forecasts and held at the central bank's 2% target, keeping alive expectations it will end negative interest rates by April.

The 2.0% gain in the core consumer prices index (CPI) was slower than the 2.3% increase in December, internal affairs and communications ministry data showed on Tuesday, underscoring views waning cost-push inflation from commodity imports could ease the pain of higher living costs.

However, the gain beat median market forecasts for a 1.8% rise, reaffirming expectations hefty pay hikes will be offered by big firms at labour-management wage talks on March 13 that would pave the way for the Bank of Japan (BOJ) to end negative interest rates in March or April.

"The January CPI leaves open the possibility of the BOJ hiking its policy rate at the March meeting if preliminary Shunto results due a few days before the meeting are encouraging," said Marcel Thieliant at Capital Economics, referring to Japanese name for the wage talks.

Japan's core consumer price index includes oil products but excludes fresh food prices.

The slowdown was due in part to a big drop in energy costs, reflecting the base effect of last year's sharp rise and government subsidies to curb gasoline and utility bills, in a sign of waning cost-push pressure that had kept core inflation at or above the BOJ's 2% target since April 2022.

More

Japan's inflation beats forecasts, end of negative rates in sight | Reuters

Covid-19 Corner

This section will continue until it becomes unneeded.

Mandating COVID-19 vaccines for some Queensland frontline workers found to be unlawful, judge rules

February 27, 2024

A judge has ruled that mandating COVID-19 vaccines for some Queensland frontline workers was unlawful based on human rights grounds.

Dozens of Queensland Police Service (QPS) and Queensland Ambulance Service (QAS) staff challenged their workplace mandates in the Supreme Court in 2022, after they refused to comply with the directives.

The two groups were testing the legality of the directions on several grounds of the Judicial Review Act (JRA) and the Human Rights Act (HRA).

On Tuesday, Justice Glenn Martin found the applicants "had not established any ground under the JRA of unreasonableness".

However, he did find the directives breached section 58 of the HRA, which states that all public service employees must give proper consideration to human rights before making a decision, and that they must act and make decisions that are compatible with human rights.

In a written decision, Justice Martin determined the commissioner of police failed to comply with this section of the act — despite being provided human rights compatibility assessments — and based on this, declared that the QPS directions were unlawful.

Justice Martin also found the director-general of the Department of Health was not able to prove he had the power to make the direction under an implied term of the QAS employment agreement. Due to this, the direction was found to be of no effect and had "no force".

Arguments were also made by the applicants about breaches of section 17 of the HRA, which says people should not be subjected to medical treatment without full, free and informed consent.

However, Justice Martin ruled that this human rights limit was reasonable when weighing all the circumstances.

QAS workers were required to have received two doses of the vaccine by December 2021.

The QPS staff deadline to be fully vaccinated was in January 2022 — unless an approved exemption was granted for medical and religious reasons, or exceptional circumstances.

The QAS mandate was ordered to ensure staff would not pose a significant risk to patients and the broader community, after it was determined COVID-19 had been shown to "disproportionately affect healthcare workers".

The QPS said it introduced its mandate for similar public health reasons, as the nature of police work meant officers interacted with large numbers of people across the state.

Mandates for both have since been lifted.

More

Mandating COVID-19 vaccines for some Queensland frontline workers found to be unlawful, judge rules - ABC News

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.

Ultra-high density hydrogen storage holds twice as much as liquid H2

Paul McClure  February 20, 2024

A nanoporous material that holds hydrogen at twice the density of cryogenic liquid H2 could address the challenges of large-scale liquid and gas storage that have held this clean fuel back.

Hydrogen is finding plenty of applications as a clean fuel – in trucking and commercial vehicles, short range aviation and shipping, for example, where it carries considerably more energy per weight and volume than lithium batteries and can deliver superior range figures and quick refueling. You can burn it more or less like gasoline, or run it through a fuel cell to generate electric power.

It has the highest energy per mass of any fuel, but it's a pain to store. Keep it in gas tanks and you'll need some 700 atmospheres' worth of compression. Keep it as a liquid, and you'll need to maintain cryogenic temperatures just 20 degrees above absolute zero. And even when squashed into a supercooled liquid, it might be lightweight, but it takes up a surprising and inconvenient amount of volume, making it both energy-hungry and tough to package where space is an issue.

Now, Korean researchers say they've created a material that stores hydrogen at double the density of its cryogenic liquid form. “Our innovative material represents a paradigm shift in the realm of hydrogen storage, offering a compelling alternative to traditional approaches,” said Hyunchul Oh, from the Ulsan National Institute of Science and Technology (UNIST), lead author on this new research.

As a molecule, hydrogen can physically adsorb into a porous material in a process called physisorption. Highly porous materials have previously demonstrated the ability to store a large amount of hydrogen per unit mass, but they've struggled to store a lot of energy within a small volume.

Until now. The team synthesized nanoporous magnesium borohydride (Mg(BH4)2), a framework with partially negatively-charged hydrogen atoms forming the nanopore’s inner surface, enabling the uptake of hydrogen and nitrogen. Although both nitrogen and hydrogen can enter the pores, the researchers found that the gas uptake for hydrogen was larger by a factor of three as both occupy different adsorption sites in the pores.

More

Ultra-high density hydrogen storage holds twice as much as liquid H2 (newatlas.com)

Take calculated risks. That is quite different from being rash.

General George Patton.

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