Thursday, 4 April 2024

Stocks Bubble Bursting? EVs Edsels? Get Gold?

Baltic Dry Index. 1711 -03           Brent Crude  89.59

Spot Gold 2299                   US 2 Year Yield 4.68 -0.02

When misguided public opinion honors what is despicable and despises what is honorable, punishes virtue and rewards vice, encourages what is harmful and discourages what is useful, applauds falsehood and smothers truth under indifference or insult, a nation turns its back on progress and can be restored only by the terrible lessons of catastrophe.

Frederic Bastiat.

Are stocks “rotating” or is the bubble bursting? Did stocks just run out of hype and greater fool buyers?

Is the smart money “rotating” out of the dollar and into commodities with real intrinsic value?

With Uncle Scam, under President Biden Joe Biden wracking up a trillion of new US debt every 100 days, are we in the beginning of the end of the fiat currency dollar reserve standard?  Is that why every country is rushing towards Central Bank Digital Currencies?

Are today’s EVs the 21st century Ford Edsel?


Japan leads gains in Asia as investors assess Powell’s comments; Hong Kong, China and Taiwan markets closed

UPDATED WED, APR 3 2024 10:28 PM EDT

Asia-Pacific markets rebounded following a sell-off in the previous session, as investors digest comments from U.S. Federal Reserve Chairman Jerome Powell.

Powell said it would take a while for policymakers to evaluate the current state of inflation, keeping the timing of potential interest rate cuts uncertain.

In Asia, investors will assess March service sector activity data from India, as well as retail sales numbers from Hong Kong.

Markets in Hong Kong, mainland China and Taiwan are closed for a public holiday.

In Australia, the S&P/ASX 200 rose 0.49%, after clocking losses for two days.

Japan’s Nikkei 225 gained 1.34% and was hovering near the 40,000 mark, while the broad-based Topix rose 1.05%

South Korea’s Kospi also gained 1.22%, powered by expectations that heavyweight Samsung Electronics will post a near nine-fold increase in its first-quarter profit from a year earlier. Samsung shares climbed 1.55% on its open.

Overnight in the U.S., the Dow Jones Industrial Average fell 0.11%, to mark its third straight negative day. The S&P 500 inched higher by 0.11% in its first winning session of the week, and the Nasdaq Composite traded up by 0.23%.

Oil climbs to highest level since October 2023, gold scales a fresh peak

Crude oil prices on Thursday climbed to their highest level since October 2023 on investor concerns about supply disruptions due to conflict in the Middle East.

Brent futures were trading 0.21% higher at $89.53 per barrel, while West Texas Intermediate futures were up 0.25% at $85.62 per barrel.

Separately, spot gold hit a fresh high before giving up some gains. It was last trading at $2,300.2 per ounce.

Asia markets live updates: Powell inflation, India PMI (cnbc.com)

 

Stock futures tick higher following third straight day of losses for the Dow: Live updates

UPDATED WED, APR 3 2024 7:58 PM EDT

U.S. stock futures inched higher Wednesday night after the Dow Jones Industrial Average registered its third straight losing session. 

Futures tied to the 30-stock Dow rose 41 points, or 0.1%. S&P 500 futures gained 0.2%, while Nasdaq 100 futures added 0.3%. 

During Wednesday’s main trading session, the Dow slipped 0.1% to post a three-day negative streak. Meanwhile the S&P 500 and Nasdaq Composite inched up just 0.1% and 0.2%, respectively. 

Investors’ fears that the Federal Reserve may keep rates higher longer weighed on stocks. Fed Chairman Jerome Powell said on Wednesday that policymakers will need more proof that inflation is moving toward the central bank’s 2% guideline before rates can come down. Atlanta Fed President Raphael Bostic also told CNBC that he thinks one cut might be in the cards.

As a result, Wall Street has adjusted its expectations for rate reductions. Fed funds futures trading data now suggests a 62.3% likelihood of a cut at the Federal Reserve’s June meeting, down from about 70% last week, according to the CME FedWatch Tool.

In addition, companies added 184,000 workers in March, according to ADP. The result trounced Dow Jones’ estimate of 155,000 and spurred investors’ fears that rates may indeed stay higher longer. The 10-year Treasury note briefly topped 4.4% and touched a high for 2024.

“There’s a lot of short-term volatility and nervousness in the bond market,” said Larry Tentarelli, chief technical strategist for Blue Chip Daily Trend Report. “I don’t think that the Fed really has any reason to cut rates. The economy is so strong and we still have not beaten inflation yet.”

Meanwhile, he thinks the equity market is showing signs of a “bullish rotation,” or a diversification of growth beyond the megacap tech names that have powered the market rally since last fall. 

More

Stock market today: Live updates (cnbc.com)

Next, EVs. Was that it?


Not even Elon can save EVs from disaster

Wed, April 3, 2024 at 1:18 PM GMT+1

Never was the old adage “don’t buy the prototype, buy the redesign” more appropriate. Motorists who bought an electric vehicle in the belief that it would hold its value better than a petrol or diesel must be feeling a little sore. According to the AA, the secondhand values of the 20 most popular electric and hybrid cars was down 12 per cent in the first quarter of this year compared with the first quarter of 2023. That is the drop in value of like-for-like cars, not what buyers can expect to lose in depreciation over the first year.

In some cases the fall has been far greater. According to a recent survey by Cap Hpi, the value of a one year old Peugeot e-2008 with 10,000 miles on the clock fell 38.7 per cent between January  and December 2023.

The tide has turned for Tesla, too, as it runs out of well-off, eco-conscious motorists interested in buying its vehicles. In the three months to March it sold 386,810 vehicles, down from 422,875 in the same period in 2023. Tesla shares plunged seven per cent on the news – although given that the company’s market valuation is still nearly twice that of the world’s second most valuable carmaker, Toyota, no one should be confident of a rebound any time soon.   

I have nothing against electric cars, which have already found a niche as city cars for people with the good fortune to have private driveways. If battery technology develops to the point at which electric cars can travel 500 miles on a single charge and take 10 minutes to recharge they will start to sell themselves, without motorists being forced to buy them through government mandates.

Indeed, that will be the point at which I will happily dump my diesel and go pure electric. But the promotion of electric cars over the past few years has been a triumph of hype over reality – which not even Elon Musk has been able to overcome.

EVs have been pushed at us on a promise that they have been unable to fulfil. A surge in interest from wealthy people who like to show off their environmental credentials was mistaken for an inexorable market trend towards EVs. As it happens, the share of the market held by pure electric cars has stalled at around one in six.

The result has been an awful lot of burned fingers – and not just among motorists. Western governments continue to try to subsidise their way to a native mass-market in EV battery production, when it is quite clear that China has cornered that market and it is not coming back. It isn’t big battery plants that Europe should be investing in, but research and development facilities where we can work on better battery technology. If successful, they can be licensed around the world.

More

Not even Elon can save EVs from disaster (yahoo.com)

 

Noted Tesla bear says Musk’s EV maker could ‘go bust’ and stock is worth $14

Tesla could “go bust” while its stock could fall to $14, Per Lekander, a hedge fund manager who has been shorting Elon Musk’s electric car maker since 2020, told CNBC on Wednesday.

His comments come after Tesla reported 386,810 vehicle deliveries in the first quarter of the year, significantly below even the lowest market estimates.

“This was really the beginning of the end of the Tesla bubble, which probably, arguably was the biggest stock market bubble in modern history,” Lekander, managing partner at investment management firm Clean Energy Transition, said on “Squawk Box Europe.”

“I actually think the company could go bust.”

Tesla was not immediately available for comment when contacted by CNBC.

Lekander was a former portfolio manager at investment firm Lansdowne Partners who successfully called a 2018 rally in carbon prices. Since 2020, Clean Energy Transition has been short Tesla’s stock, meaning Lekander’s firm will profit if the automaker’s shares fall.

In a March 2021 interview with CNBC, Lekander called for Tesla’s stock to go down. At the time of the interview, Tesla’s shares closed at $233.94. On Tuesday, the stock closed at $166.63. But Lekander also called for a comeback of the traditional automakers, singling out Volkswagen. Shares of Volkswagen have fallen around 53% since that call, though they rallied at the start of this year.

Lekander has taken his bearish Tesla call further, suggesting the stock could fall to $14 per share. He said his call is based on an estimate that the company’s full-year earnings per share this year would be $1.40. Lekander contends that Tesla is a “no growth” stock and should be valued on 10 times forward earnings, versus around 58 times forward earnings currently. Forward earnings are an important metric used by traders to gauge the value of a stock.

If Tesla’s stock hit $14, that would represent around 91% downside from Tuesday’s close. Tesla’s shares have already fallen more than 30% this year.

“I think however Tesla cannot be at $14. If it falls under a certain level because of everything that’s been going on, it’s going to go bust.”

More

Tesla bear says Elon Musk's EV maker will 'go bust,' stock worth $14 (cnbc.com)

Finally, are IDF “mistakes,” mistakes, or given their record of “mistakes” does the IDF practise “mistakes?”

 

Chef Jose Andres says Israel targeted his aid workers 'systematically, car by car'

By Jeff Mason 

WASHINGTON, April 3 (Reuters) - Celebrity chef Jose Andres told Reuters in an emotional interview on Wednesday that an Israeli attack that killed seven of his food aid workers in Gaza had targeted them "systematically, car by car."

Speaking via video, Andres said the World Central Kitchen (WCK) charity group he founded had clear communication with the Israeli military, which he said knew his aid workers' movements.

"This was not just a bad luck situation where ‘oops’ we dropped the bomb in the wrong place," Andres said.

"This was over a 1.5, 1.8 kilometers, with a very defined humanitarian convoy that had signs in the top, in the roof, a very colorful logo that we are obviously very proud of," he said. It's “very clear who we are and what we do.”

Andres said the IDF was aware of the convoy's whereabouts opens new tab. He called for investigations of the incident by the U.S. government and by the home country of every aid worker that was killed.

"They were targeting us in a deconflicting zone, in an area controlled by IDF. They knowing that it was our teams moving on that road ... with three cars," he said.

The aid workers were killed when their convoy was hit shortly after they oversaw the unloading of 100 tons of food brought to Gaza by sea. Israel's military expressed "severe sorrow" over the incident and Prime Minister Benjamin Netanyahu called it unintentional.

Andres said there may have been more than three strikes against the aid convoy. He rejected Israeli and U.S. assertions that the strike was not deliberate.

"Initially, I would say categorically no," Andres said when asked if he accepted that explanation.

"Even if we were not in coordination with the (Israel Defense Forces), no democratic country and no military can be targeting civilians and humanitarians," he added.

More

Chef Jose Andres says Israel targeted his aid workers 'systematically, car by car' | Reuters

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.

Euro zone inflation unexpectedly slows to 2.4% in March, with core print also below forecast

PUBLISHED WED, APR 3 2024 5:04 AM EDT

Inflation in the 20-nation euro zone eased to 2.4% in March, according to flash figures published on Wednesday, boosting expectations for interest rate cuts to begin in the summer.

Economists polled by Reuters had forecast the rate would hold steady against the previous month at 2.6%.

The core rate of inflation, excluding energy, food, alcohol and tobacco, cooled from 3.1% to 2.9%, also coming in below expectations.

However, inflation in services — a key watcher for the European Central Bank — remained stuck at 4% for a fifth straight month, pointing to continued pressure from wage growth.

Another indicator for the ECB released Wednesday, the euro area unemployment rate, stood at 6.5% in February, stable against January but down from 6.6% in February 2023.

Price rises in France and Spain came in lower than forecast last week. On Tuesday, headline inflation in the bloc’s biggest economy, Germany, was estimated at a three-year low of 2.2%.

Markets expect the euro zone’s central bank will begin lowering borrowing costs in June — a position reflected in the recent messaging of ECB decision-makers. They are next set to hold a monetary policy meeting on April 11.

Even Austrian central bank head Robert Holzmann, an ECB hawk who previously said it was possible that no cuts at all would take place in 2024, told Reuters this week that he did not have an “in-principle objection to easing in June.”

“The current narrative is clearly pointing to a first rate cut in June,” Carsten Brzeski, global head of macro at ING, said in a note on Wednesday. That is due to the March inflation print as well as the data on wage growth and ECB staff forecasts on gross domestic product and inflation that will be released by then, he said.

Kamil Kovar, senior economist at Moody’s Analytics, said the release of Wednesday “poured cold water on the idea that the last mile in defeating inflation will be hardest,” and reiterated a call for five rate cuts this year.

“Inflation has declined despite a jump in energy inflation, and a boost from an early Easter. Even if the good headline number masked some less favorable details, such as services coming in hot while food prices tumbled, inflation overall is still on course to dip below 2% sometime during the summer,” Kovar said.

Euro zone inflation March 2024 (cnbc.com)

Covid-19 Corner

This section will continue until it becomes unneeded.

Cause of teen's death unable to be 'satisfactorily determined' - coroner

April 2, 2024

It is impossible to tell if a 13-year-old boy died from his Covid-19 vaccine or a virus, a coroner has ruled.

The teenager had his second Pfizer vaccine 10 days before his sudden death at home in October 2021 - he had gone to bed in the evening and never woke up.

Coroner Robin Kay ruled the teenager died after suffering cardiac arrhythmia causing acute myocarditis - but could not conclude how that myocarditis was caused.

Reporting restrictions mean that identifying details of the person - such as their name - cannot be reported on.

On the afternoon of 27 October, the teenager had a normal afternoon doing chores, playing cards and watching a movie.

He went to bed around 8.30pm saying he felt warm. He was found in his bed on the morning of 28 October and ambulance staff pronounced him dead at his home.

Coroner Kay noted the teenager was fit and active, without any significant medial issues.

He had received the Covid-19 Pfizer vaccine 10 days' before his death, and had not displayed any adverse reaction to it in the days following.

This is one of four deaths which had been reported to the Covid-19 Vaccine Independent Safety Monitoring Board as being possibly linked to the vaccine as of 2024.

Overall, more than 13 million vaccines have been administered to people in New Zealand, and 3923 people have died as a result of the virus.

Myocarditis is inflammation of the heart muscle. It can be caused by different things, most commonly from viral infections. In rare cases, it is a side effect of Covid-19 vaccines.

Dunedin man Rory Nairn's death was one that was ruled as being caused by the Covid-19 vaccine - the 26 year old experienced heart flutters in the days after receiving the vaccine.

In this case, Coroner Kay considered reports from two forensic pathologists and from the Covid-19 Independent Monitoring Board in coming to his conclusions.

He found that the cause of the teenager's death was probable cardiac arrhythmia due to myocarditis, but that the cause of the myocarditis could not be "satisfactorily determined".

He referred to one of the pathologist's evaluations that this was a complicated case, where death was caused by a tiny amount of inflammation that occurred in a "crucial part" of the heart which helps it beat.

More

Cause of teen's death unable to be 'satisfactorily determined' - coroner (msn.com)

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.

EU and Japan team up to develop new advanced materials

April 2, 2024

The EU aims to create a platform for sharing information with Japan on advanced materials such as graphene, along with potential research collaborations.

The EU and Japan are strengthening their research relationship with the launch of an enhanced dialogue on advanced materials.

Under this agreement, the EU and Japan will work on developing new materials that are used in critical sectors of the economy, such as renewable energy, batteries, zero-emission buildings and semiconductors. It aims to create a platform for sharing information on policy developments and exploring collaborative research opportunities.

The EU said these materials are also important for both the green and digital transitions and are a “vital part of economic sovereignty and strategic independence”.

The EU describes advanced materials as those that are engineered to display superior performance or special functions. A key example is graphene, a one-atom-thick layer of carbon that has many potential applications due to its flexibility and conductivity.

The EU expects the demand for advanced materials to increase significantly in the coming years and believes itself – and Japan – have a global lead in this technology. The agreement follows a recent strategy proposed by the European Commission to move towards “EU industrial leadership” in advanced materials.

The new agreement builds on the success of the EU’s collaboration with Japan in material sciences, which included the development of new materials for the substitution of critical metals and advanced materials for power electronics. EU commissioner Iliana Ivanova said the new dialogue on advanced materials “strengthens our cooperation with Japan in research and innovation”.

“These materials are critical for our transition to a green future, and by joining forces, we can get there faster,” Ivanova said. “I look forward to seeing the results of this new cooperation with Japan.”

The EU and Japan have worked together in various sectors of research. Last year, the two entities strengthened their partnership in space research by agreeing to share Earth observation data with each other.

EU and Japan team up to develop new advanced materials (siliconrepublic.com)

Finally, our latest new section, the world global debt clock. Nations debts to GDP compared.

World Debt Clocks (usdebtclock.org)

When plunder becomes a way of life, men create for themselves a legal system that authorizes it and a moral code that glorifies it.

Frederic Bastiat.


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