Tuesday 28 May 2024

Asian Markets Mixed. Month-end May. More EV Troubles.

Baltic Dry Index. 1797 +01     Brent Crude  83.29

Spot Gold 2351           US 2 Year Yield 4.93 +0.02

In the run up to the UK General Election on July 4, the LIR will play its part.

He knows nothing and thinks he knows everything. That points clearly to a political career.

George Bernard Shaw, socialist.

In the stock casinos, an interesting end of month week. Normally, it’s a dress up the month-end stocks and stock indexes week ahead of the summer doldrums.

But with EU and US inflation figures coming out on Friday, this final trading week of May might be more nervous than usual.

Not helping stock casinos either:

Canada, Mexico and Argentina started to settle securities trades in one day rather than two, in a move designed to reduce counterparty risk and improve market liquidity. U.S. markets will move to the new standard, commonly called T+1, on Tuesday.

Though everything is expected to go through smoothly, there’s always a potential for an unexpected glitch.

 

Asia markets mixed after ECB officials hint at rate cut, Australia retail sales rise

UPDATED TUE, MAY 28 2024 11:45 PM EDT

Asia-Pacific markets were mixed Tuesday as investors assessed comments from the European Central Bank officials signaling that rate cuts may be on the horizon for the world’s largest economic bloc.

In Asia, the S&P/ASX 200 edged 0.24% lower as Australia’s retail sales growth missed Reuters’ poll estimates. Sales growth in April rose 0.1% compared with March.

Japan’s Nikkei 225 dipped 0.16%, while the broad-based Topix was nearly flat.

South Korea’s Kospi was fractionally higher, while the small-cap Kosdaq was up 0.36%.

Hong Kong’s Hang Seng index rose 0.64%, while mainland China’s CSI 300 index was 0.26% down.

In a speech Monday, Olli Rehn, ECB governing council member and head of Finland’s central bank, stressed inflation in the euro area was falling in a “sustained way.” He added: “The time is thus ripe in June to ease the monetary policy stance and start cutting rates.”

Inflation in the euro zone held steady at 2.4% in April, marking the seventh straight month it has been below 3%, despite a slight rebound in December. The data for May will be out Friday.

“Barring major surprises, at this point in time there is enough in what we see to remove the top level of restriction,” ECB Chief Economist Philip Lane said in an interview with the Financial Times.

The comments come ahead of the central bank’s next meeting on June 6. Markets are now indicating a very high chance of a quarter-percentage-point cut to the ECB’s main rate, from 4% currently.

U.S. markets return to trade today after being closed Monday for Memorial Day, with stock futures for all three major indexes rising.

Futures for the blue-chip Dow Jones Industrial Average climbed 0.09%, while those tied to the S&P500 were up 0.13%. Nasdaq futures saw the most gains, rising 0.21%.

Asia markets: ECB rate cut possibility, Australia retail sales (cnbc.com)

 

Stock futures rise to kick off shortened trading week: Live updates

UPDATED TUE, MAY 28 2024 7:04 PM EDT

Stock futures advanced Monday night as investors await inflation data due at the end of the shortened trading week for a better picture of the market’s outlook.

Futures tied to the Dow Jones Industrial Average added 38 points, or 0.1%. S&P futures gained 0.1%, while Nasdaq 100 futures edged up 0.2%.

Stocks are on track to end May on a strong note, after softer inflation data earlier this month and better-than-expected quarterly earnings reports lifted sentiment and suggested rate cuts could come earlier than investors had anticipated.

Recently, however, stronger economic data and fresher concerns about a potential consumer spending pullback have dampened the interest rate outlook.

This month, the S&P 500 has advanced 5.3%, while the Nasdaq Composite has rallied about 8%, after ending last week at a fresh record high. The Dow Jones Industrial Average is up 3.3%, meanwhile, and topped 40,000 for the first time ever this month.

Looking ahead to this week, investors are watching for consumer confidence data out Tuesday and the April personal income and expenditures report, which includes the PCE inflation reading, out Friday. Several companies are also on deck to report earnings results, with names like Costco Wholesale and Ulta Beauty expected to give more clarity on the state of the consumer.

Stock market today: Live updates (cnbc.com)

Toronto market ends higher as commodity prices climb

By Khushi Singh and Fergal Smith 

May 27 (Reuters) - Canada's main stock index rose on Monday as higher commodity prices boosted resource shares and the market transitioned to a faster trade settlement standard, while investors looked ahead to bank earnings reports this week.

The Toronto Stock Exchange's S&P/TSX composite index (.GSPTSE) opens new tab ended up 52.51 points, or 0.2%, at 22,373.38, moving closer to the record closing high it posted last Tuesday at 22,468.16.

Trading volume was lower than usual with U.S. markets closed for the Memorial Day holiday.

"The U.S. is closed, commodities are running and investors are waiting for bank earnings across the rest of the week, so there is good reason for optimism in the Canadian market today," said Colin Cieszynski, chief market strategist at SIA Wealth Management.

The materials group (.GSPTTMT) , which includes metal miners and fertilizer companies, gained 1.2% as gold prices rose.

"We expect gold prices to stay volatile, and price setbacks to be shallow, targeting gold prices to test new record highs later this year," UBS analyst Giovanni Staunovo said.

Energy (.SPTTEN)  also advanced, gaining 0.3%, as the price of oil increased 1.1% to $78.55 a barrel.

Canada, Mexico and Argentina started to settle securities trades in one day rather than two, in a move designed to reduce counterparty risk and improve market liquidity. U.S. markets will move to the new standard, commonly called T+1, on Tuesday.

Canadian wholesale trade rose 2.8% in April from March, largely driven by higher sales in the motor vehicle and motor vehicle parts and accessories subsector, a preliminary estimate showed.

Bank of Nova Scotia (BNS.TO)  is due to report quarterly earnings on Tuesday, while some of Canada's other major banks report later in the week.

On Thursday, Toronto-Dominion Bank (TD.TO)b reported better-than-expected earnings even as its U.S segment struggled amid probes related to its anti-money laundering program.

Toronto market ends higher as commodity prices climb | Reuters

Gold steady as focus turns to US inflation data

By Sherin Elizabeth Varghese 

May 28 (Reuters) - Gold prices held steady on Tuesday as the dollar eased, while investors looked forward to key U.S. inflation data that could offer clues on how soon the Federal Reserve can cut interest rates.

Spot gold was flat at $2,350.85 per ounce, as of 0350 GMT, after rising about 1% in the previous session.

U.S. gold futures rose 0.8% to $2,352.00.

"A very strong dollar picture supported by a change in the U.S. monetary policy stance where the Fed starts looking for evidence to kick start interest rate hikes instead of easing could be a major risk as we could see a further corrective move in spot gold," said Kelvin Wong, a senior market analyst for Asia Pacific at OANDA.

However, in the short term, spot gold is still more skewed towards the positive side rather than the negative side and $2,310 is a key short-term support for this week, Wong added.

The core personal consumption expenditures price index (PCE), the Fed's preferred inflation measure, is due on Friday.

Fed meeting minutes released last week showed that the policy response, for now, would involve maintaining the benchmark policy rate at its current level but also reflected discussions of possible further hikes.

Traders' bets indicated rising scepticism that the U.S. central bank will lower rates more than once in 2024, currently pricing in about a 62% chance of a rate cut by November according to the CME FedWatch Tool.

Bullion is known as an inflation hedge, but higher rates increase the opportunity cost of holding non-yielding gold.

Vietnam's central bank will stop auctioning gold in the domestic market and launch a new measure to stabilise domestic prices, it said on Monday.

Spot silver rose 0.2% to $31.73, platinum was up 0.4% to $1,058.50 and palladium gained 0.2% to $991.18.

Gold steady as focus turns to US inflation data | Reuters

Finally, more Tesla’s are piling up unsold in America. That EV bust deepens. Greek ferries restrict EVs. Approx. 8 minutes.

THOUSANDS of EVs from Tesla are PILING UP Across US!

THOUSANDS of EVs from Tesla are PILING UP Across US! (youtube.com)

Greek ferries no longer transport fully charged electric cars

By Carla Westerheide   23.05.2024 - 16:59

According to the German automobile club ADAC, a new regulation issued by the Greek Ministry of Shipping and Island Policy in force since mid-April is already being implemented by major Greek shipping companies. For safety reasons, the batteries of electric cars may only have a maximum charge level of 40 per cent. The focus here is on batteries of purely electric vehicles as well as plug-in hybrids.

Greek ferries no longer transport fully charged electric cars | electrive.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.

The time is ripe to cut interest rates next week, European Central Bank’s Rehn says

PUBLISHED MON, MAY 27 2024 5:18 AM EDT

Two key European Central Bank figures on Monday threw their weight behind the prospect of an interest rate cut next week, indicating that it is practically a done deal.

In a speech on Monday, Olli Rehn, ECB governing council member and head of Finland’s central bank, stressed that inflation in the euro area was falling in a “sustained way.”

Inflation in the euro area held steady at 2.4% in April, marking the seventh straight month it has been below 3%, despite a slight rebound in December. The figures for May are due on Friday.

“Thanks to this disinflationary process, inflation is converging to our 2% target in a sustained way, and the time is thus ripe in June to ease the monetary policy stance and start cutting rates,” Rehn said in a speech published on the website of the Finnish central bank.

“This obviously assumes that the disinflationary trend will continue and there will be no further setbacks in the geopolitical situation and energy prices.”

----The comments come ahead of the central bank’s next meeting on June 6. Markets are now indicating a very high chance of a quarter-percentage-point cut to the ECB’s main rate, from 4% currently.

The comments from Rehn and Lane on Monday follow a slew of similar sentiments from other ECB members.

It indicates that the European Central Bank is likely to move sooner than the U.S. Federal Reserve, which usually leads the way in monetary policy decisions.

more

Time is 'ripe' to cut rates next week: European Central Bank's Rehn (cnbc.com)More

ECB's Lane says ready to start cutting interest rates, FT reports

By Reuters 

May 27 (Reuters) - The European Central Bank's Philip Lane said the ECB is ready to start cutting interest rates from next week, the Financial Times reported on Monday, ahead of its June 6 policy meeting.

"Barring major surprises, at this point in time there is enough in what we see to remove the top level of restriction," Lane told the FT in an interview.

Lane said ECB policymakers needed to keep rates in restrictive territory this year to ensure that inflation kept easing and did not get stuck above the bank's target, which "would be very problematic and probably quite painful to eliminate".

He said the pace at which the central bank lowered euro zone borrowing costs this year would be decided by assessing data to determine if it's safe and proportional.

The ECB has all but promised to cut interest rates on June 6 but some analysts have started trimming their expectations for further reductions after stronger-than-expected wages data.

Negotiated pay growth in the euro zone picked up slightly in the first quarter of 2024, bolstering the case for caution in cutting rates from record highs.

However, Lane said "the overall direction of wages still points to deceleration, which is essential".

"The best way to frame the debate this year is that we still need to be restrictive all year long, Lane said, adding, "But within the zone of restrictiveness we can move down somewhat."

ECB's Lane says ready to start cutting interest rates, FT reports | Reuters

Covid-19 Corner

This section will continue until it becomes unneeded.

WHO: COVID-19 reversed life expectancy targets

May 27, 2024

MANILA, Philippines — The COVID-19 pandemic wiped out in just two years the progress made over 10 years to improve life expectancy, according to the World Health Organization (WHO).

Based on the 2024 World Health Statistics released on Friday, global life expectancy at birth dropped by 0.7 years to 72.5 years in 2020 (back to 2016 level). In 2021, it dipped even further by 1.1 years to 71.4 years (2012 level).

This meant that a person born in 2021 now has a shorter lifespan of 71 years compared with someone born in 2019, who is expected to live for 73 years.

According to data from the World Bank, Filipinos had an average life expectancy of 71.865 years in 2019, a year before the pandemic. By 2021, it was down to 69.266 years, which was shorter than the 1999 life expectancy level of 69.298 years.

New pandemic pact

In a statement, WHO Director General Tedros Adhanom Ghebreyesus noted the continuous major progress in global health, with billions of people enjoying better health, better access to services and better protection from health emergencies.

“But we must remember how fragile progress can be. In just two years, the COVID-19 pandemic erased a decade of gains in life expectancy. That’s why the new Pandemic Agreement is so important: not only to strengthen global health security, but to protect long-term investments in health and promote equity within and between countries,” he added.

The WHO official was referring to a treaty on how best to handle the next pandemic, with the final draft to be presented during the 77th World Health Assembly, the annual meeting of health ministers worldwide in Geneva, Switzerland, from May 27 to June 1.

More

WHO: COVID-19 reversed life expectancy targets (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.

‘Graphene superhighway’ allows electronic devices to use much less power

May 24, 2024

Physicists have created a five-lane graphene superhighway for electrons that could pave the way for ultra-efficient electronics and more. The work revolves around a unique form of pencil lead known as rhombohedral pentalayer graphene.

Long Ju is an assistant professor in the MIT Department of Physics and corresponding author of the paper. He explains, "This discovery has direct implications for low-power electronic devices because no energy is lost during the propagation of electrons, which is not the case in regular materials where the electrons are scattered."

Smooth commute for electrons

The phenomenon discovered by the team is similar to cars traveling down an open turnpike as opposed to those moving through neighborhoods.

In regular materials, electrons can be stopped or slowed by other factors, much like cars in a neighborhood can be disrupted by abrupt stops or U-turns. However, in rhombohedral pentalayer graphene, electrons can travel unimpeded.

"We found a goldmine, and every scoop is revealing something new," says Ju, who is also affiliated with MIT's Materials Research Laboratory. The material was first discovered two years ago by physicists led by Ju.

Birth of the graphene superhighway

In a Nature Nanotechnology paper last October, Ju and colleagues reported the discovery of three important properties arising from rhombohedral graphene.

They showed that it could be topological, allowing the unimpeded movement of electrons around the edge of the material but not through the middle. This resulted in a superhighway, but required the application of a large magnetic field.

In the current work, the team has managed to create the superhighway without any magnetic field.

Tonghang Han is an MIT graduate student in physics and co-first author of the paper. He notes, "We are not the first to discover this general phenomenon, but we did so in a very different system. And compared to previous systems, ours is simpler and also supports more electron channels."

----In the current work, the team added a layer of tungsten disulfide (WS2) to the original system.

"The interaction between the WS2 and the pentalayer rhombohedral graphene resulted in this five-lane superhighway that operates at zero magnetic field," says Ju.

More

‘Graphene superhighway’ allows electronic devices to use much less power (msn.com)

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

World Debt Clocks (usdebtclock.org)

A politician is visiting the local mental asylum, and asked "How do you decide whether someone should be admitted here?"

"Well," says the director, "We fill up a bath with water, then give the patient a teaspoon, a mug, and a bucket, and ask them to empty the bath as quickly as possible."

"I see," says the politician, "and if he's got any sense he'll choose the bucket."

"No," says the director, "If he's got any sense he'll pull the plug out. Would you like a room with a view?"

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