Tuesday, 11 June 2024

Fed Day One. Apple AI. US CPI Tomorrow. Oil Rallies.

Baltic Dry Index. 1883 +02     Brent Crude  81.56

Spot Gold 2304             US 2 Year Yield 4.87 unch.

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

The most effective way to destroy people is to deny and obliterate their own understanding of their history.

George Orwell.

In the stock casinos, more AI hype v the start of the two day Fed meeting and tomorrow’s US Consumer Price Index figure for May.

In the EU, trying to put the best spin on Europe’s elections move to the right.


Asia-Pacific markets are trading mixed; Taiwan market touches new highs

Asia-Pacific markets were mixed on Tuesday, even as the S&P 500 and Nasdaq Composite reached new highs on Wall Street overnight.

Traders in Asia will be looking to the U.S. Federal Reserve’s decision on Wednesday stateside, which will come after the May inflation report is released earlier the same day.

Investors will parse through the Fed’s updated projections on the timing and frequency of rate cuts. Markets are now pricing in just one rate cut this year, coming in November, according to the CME FedWatch Tool.

Asia-Pacific markets like Australia, Hong Kong, mainland China and Taiwan will return to trade on Tuesday, after being closed for a public holiday the previous day.

The Taiwan Weighted index surged to record highs as it gained 0.46%, powered by technology and utility stocks.

Japan’s Nikkei 225 extended gains to climb 0.42%, while the broad based Topix was 0.37% up.

South Korea’s Kospi rebounded from Monday’s losses, gaining 0.57%, while the small cap Kosdaq was 0.73% higher.

On the other hand, Hong Kong’s Hang Seng index plunged 1.16% on its open, while the mainland Chinese CSI 300 index was 0.51% lower.

Australia’s S&P/ASX 200 fell 1.27%.

The broad S&P 500 index advanced by 0.26%, closing at 5,360.79, while the Nasdaq Composite gained 0.35% to end at 17,192.53.

The Dow Jones Industrial Average added 0.18%, tracking the rise in the S&P and Nasdaq.

Asia markets live updates: S&P, Nasdaq record high, Philippine trade (cnbc.com)

European stocks head for flat to higher open as markets turn to Fed, U.S. inflation data

LONDON — European stocks are expected to open flat to higher Tuesday as investors look ahead to the Federal Reserve’s next meeting and U.S. inflation data.

The U.K.’s FTSE index is expected to open unchanged at 8,223, Germany’s DAX up 6 points at 18,493, France’s CAC 40 up 21 points at 7,897 and Italy’s FTSE MIB up 16 points at 34,568, according to IG.

Regional markets fell on Monday as traders reacted to the EU Parliament elections and French President Emmanuel Macron’s decision to call a snap election after the right-wing National Rally party made strong gains.

Market attention is now shifting to the U.S. Federal Reserve’s latest rate decision and May’s consumer price index, which will be released Wednesday. The U.S. inflation data could be a key test for markets, especially after Friday’s strong jobs report continued to suggest the central bank could hold off on lowering rates.

Investors will be keeping a close eye on the Fed’s updated projections on the timing and frequency of rate cuts. Markets are now pricing in just one rate cut this year, in November, according to the CME FedWatch Tool.

European markets: stocks, news, data and earnings (cnbc.com)

 

Here’s everything Apple just announced at WWDC24: Apple Intelligence, Siri with ChatGPT, iOS 18 and more

UPDATED MON, JUN 10 2024 5:42 PM EDT

Apple’s annual Worldwide Developers Conference keynote just wrapped up. The company had a lot of news, the biggest of which was its push into artificial intelligence, called Apple Intelligence. It also announced that users can tap into OpenAI’s ChatGPT when using Siri, but only if a user wants to.

Here’s what Apple announced:

Apple will release developer versions of its software beginning Monday before it is available in a public preview next month. Final versions of the software will launch for everyone once fully finished in the fall.

More

Apple WWDC 2024 updates: Apple Intelligence, Siri with ChatGPT, iOS 18 (cnbc.com)

 

Inflation data this week could help determine Fed's timetable for rate cuts

June 9, 2024

WASHINGTON (AP) — After Federal Reserve officials meet this week, a statement they will issue may suggest that they’ve seen meaningful progress on inflation this year — a prelude to eventual interest rate cuts.

Yet it's hard to say, because the officials themselves may not know for sure until they begin their meeting. That's because the government's latest snapshot of U.S. inflation will be released Wednesday morning, just before the Fed begins the second day of its policy discussions.

One key issue is a sentence the Fed added to its statement after its last meeting May 1: It said “there has been a lack of further progress" in bringing inflation back to the central bank's 2% target.

Inflation had come in uncomfortably high in the first three months of this year, dimming hopes that it would continue to steadily cool, as it had in the second half of last year.

In April, though, consumer inflation did resume slowing, if only slightly. And if the May inflation report being released Wednesday shows further signs of improvement, it's possible the Fed could drop that sentence from its statement. It would be an encouraging sign that the policymakers may cut their benchmark rate within a few months. Rate cuts would eventually lead to lower costs for mortgages, auto loans and other forms of consumer and business borrowing.

But whether or not the sentence is dropped or altered, most economists think no rate cuts are likely before September at the earliest. Chair Jerome Powell is likely to underscore at a news conference Wednesday that the policymakers will need to see several more months of low inflation readings before they would consider reducing their key rate.

A Fed rate cut might give the economy a modest lift, which would be welcomed by President Joe Biden's re-election campaign, which is struggling to counter many voters' unhappiness with the inflation spike of the past several years. Though consumer inflation has slowed dramatically since peaking at 9.1% in mid-2022, it was still 3.4% in April, well above the Fed's target.

----“The Fed’s narrative is going to be very similar to what we’ve been hearing: ‘We’ve made progress bringing down inflation; we’re not in a hurry to cut rates,’ ” said Nathan Sheets, a former senior economist at the Fed who is global chief economist at Citi.

Another issue Powell may address is whether the economy is starting to weaken. Growth slowed sharply in the first three months of the year, to an annual rate of just 1.3%, down from 3.4% in last year's final quarter.

The number of open jobs fell in April to the lowest level in three years, though the number remains high by historic standards. And consumers actually cut back on their spending in April, after adjusting for inflation, a sign that high prices and elevated interest rates are pressuring Americans' finances.

Though May's solid job growth helped assuage some of those worries, the unemployment rate edged up for a second straight month, to 4%.

More

Inflation data this week could help determine Fed's timetable for rate cuts (msn.com)

Finally, in commodities news, get gold.

 

Gold is getting harder to find as miners struggle to excavate more, World Gold Council says

PUBLISHED SUN, JUN 9 2024 9:28 PM EDT

The gold mining industry is struggling to sustain production growth as deposits of the yellow metal become harder to find, according to the World Gold Council.

“We’ve seen record first quarter mine production in 2024 up 4% year on year. But the bigger picture, I think about mine production is that, effectively, it plateaued around 2016, 2018 and we’ve seen no growth since then,” WGC Chief Market Strategist John Reade said.

According to data from the international trade association, mine production inched up only 0.5% in 2023 compared to a year ago.

In 2022, the growth was 1.35% year on year, the year before it was 2.7%, while in 2020, global gold production logged the first decline in a decade, sliding 1%.

“I think the overwhelming story there is: after 10 years of rapid growth from around 2008, the mining industry is struggling to report sustained growth in production,” said Reade.

New gold deposits are becoming harder to find around the world as many prospective areas have already been explored, he elaborated.

Large-scale gold mining is capital-intensive, and requires significant exploration and development, taking an average of 10 to 20 years before a mine is ready for production, according to WGC.

Even during the exploration process, the likelihood of a discovery progressing into the development of a mine is low, with only about 10% of global gold discoveries containing sufficient metal to warrant mining.

Around 187,000 metric tons of gold has been mined to date, with the majority coming from China, South Africa and Australia. Gold reserves that can be excavated are estimated at around 57,000 tonnes, according to the United States Geological Survey.

Aside from the discovery process, government permits getting harder to secure and requiring more time to come through have made mining more difficult, Reade added. Securing licenses and permits needed before mining companies can start operations can take several years.

Additionally, many mining projects are planned for remote areas that require infrastructure such as roads, power, and water, resulting in added costs in building these mines and financing operations, Reade said.

“It’s getting harder to find gold, permit it, finance it, and operate it,” he said.

Gold prices are taking a breather after rallying to record highs in recent months bolstered by strong demand led by China. Spot gold is currently trading at $2,294.3 per ounce.

Gold miners struggle with excavating more, says World Gold Council (cnbc.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.

Dockworkers Cancel Bargaining, Threaten Strike at U.S. Seaports

June 10, 2024

Dockworkers at America’s East Coast and Gulf Coast seaports canceled labor talks that were due to start this week and raised the possibility of a strike later this year at some of the country’s biggest trade gateways.

The International Longshoremen’s Association canceled talks set for Tuesday in Newark, N.J., to protest the use of automated machinery at some ports, which the union says violates prior labor agreements.

The withdrawal from the bargaining table marks a harsh start to negotiations aimed at securing a contract covering more than 45,000 dockworkers at ports from Maine to Texas ahead of the current agreement’s expiration Sept. 30. A walkout at that time would come as goods are flowing into the country ahead of the end-of-year holidays and threaten the American economy just ahead of the presidential election.

The union’s combative leader Harold Daggett has previously vowed his members will strike if they don’t secure a new contract before the current agreement expires on Sept. 30.

“Harold Daggett is again alerting all locals to be prepared for a strike on October 1st,” an ILA spokesman said.

The National Retail Federation, a trade group whose members include some of the country’s biggest importers, urged the sides to negotiate and called on the Biden administration to shepherd the talks. “It is critical that significant disruptions, including labor strikes, are avoided in order to minimize any negative economic impact,” said Jonathan Gold, the NRF’s vice president for supply chain.

The union says it canceled the talks after it found that a terminal operator owned by Danish carrier A.P. Moller-Maersk was using autonomous equipment to process trucks at ports including Alabama’s Port of Mobile. Union leaders say they won’t proceed with the negotiations until the issue is resolved.

Representatives for the U.S. Labor Department didn’t respond to a request for comment.

More

Dockworkers Cancel Bargaining, Threaten Strike at U.S. Seaports (msn.com)

Shipping costs at 18-month high - threatening to impact inflation

June 10, 2024

The price of shipping has reached an 18-month high - threatening to impact the falling inflation rate.

It is now more expensive to ship a typical container on a key shipping route than when Houthi militants first started attacking boats in the Red Sea late last year to prevent ships docking in and exporting from Israel.

An index that measures the average cost of a 20ft container being shipped from Shanghai to Europe - and is the most widely used measure of freight cost - has reached $3,949 (£3,102).

The Shanghai Containerised Freight Index (SCFI) has risen sharply in the last month according to data given to Sky News by global logistics company, DSV.

Not since the early days of September 2022, when global supply chains were recovering from the blockage of the Suez Canal, has the cost been so high, at $4,252 (£3,341) a container.

----Boats having to take alternative journeys and being diverted also brought shipping costs up.

It was this wave of supply chain woes that brought about part of the first shock to the economy that caused inflation, the rate of price rises, to go up.

The economy has recovered in large part from shocks - including the energy price hikes brought about Russia's invasion of Ukraine - which resulted in inflation reaching a 41-year high of 11.1% in October 2022.

While inflation has dropped significantly - to 2.3% at the latest reading - expensive shipping could bring the rate up.

Most goods on UK shelves spend at least part of their lifetime at sea, so importers having to spend more to get goods to the UK could mean consumers pay more at the tills.

More

Shipping costs at 18-month high - threatening to impact inflation (msn.com)

Covid-19 Corner

This section will continue until it becomes unneeded.

How A New Covid-19 Antibody Could Contribute To Advanced Vaccine Development

Updated Jun 7, 2024, 05:13pm EDT

In the ongoing Omicron era, a new Covid-19 antibody could renew optimism for urgently required SARS-CoV-2 monoclonal therapies. Over the last three years, various versions of SARS-CoV-2 have mutated to bypass the neutralizing effects of monoclonal antibodies. Whenever new treatments received approval from the FDA, new variants emerged that could avoid these treatments, creating a game of cat and mouse between the virus and researchers looking for new antibody treatments.

A new antibody, 1301B7, was developed by extracting convalescent sera from an individual infected with an earlier strain of Omicron, as described by Dr. Michael Piepenbrink and colleagues at the University of Alabama. The antibody exhibits potent neutralizing activity against multiple SARS-CoV-2 variants, including the latest Omicron subvariants XBB.1.5 and JN.1, and against the sister virus SARS-CoV-1. What follows are the key findings for the promising monoclonal treatment.

The greatest challenge facing antibody developers is the constant mutation of key targeted amino acids. The receptor binding domain and N-terminal domain of the spike protein are common binding sites for antibodies and are common regions of mutation in variants.

More

How A New Covid-19 Antibody Could Contribute To Advanced Vaccine Development (forbes.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 turns 20 and goes commercial, reports IDTechEx

By Dr Conor O'Brien, senior technology analyst at IDTechEx, Cambridge, UK  

June 8, 2024

Article discusses a number of emerging graphene-enhanced products in application areas

This year has marked the 20th anniversary of the original isolation of graphene, first achieved at the University of Manchester in 2004, prior to the award of the Nobel Prize in Physics in 2010. In the two decades since its isolation, graphene has been the subject of immense hype, labeled as a wonder material with superlative properties capable of enabling society-shifting technologies. In reality, the graphene market has been slow to begin approaching maturity, with limited uptake in commercial applications to date. As graphene enters its 21st year since isolation, is this outlook beginning to change?

The Advanced Materials Show, held at the National Exhibition Centre (NEC) in Birmingham UK, illustrated the beginning of a transition point in the narrative that graphene is not yet a commercially viable product could be seen. In previous years, graphene suppliers would typically showcase the range of materials offered, often displaying a number of glass vials filled with black powder. At the 2024 edition of the show, IDTechEx saw multiple suppliers showcasing tangible products ready for commercial launch. As with all discussions regarding graphene, with the multifunctionality of the material lending itself to many applications, the breadth of these tangible products was noticeable.

Automotive

Haydale (UK) is a long-standing manufacturer of functionalized graphene, utilizing a plasma-based approach, and has developed a functionalized graphene ink for heating applications. At the show, a heater mat for automotive use was showcased, which is claimed to be six times more energy efficient than a typical wire heater. 

More, much more.

Graphene turns 20 and goes commercial, reports IDTechEx - Electronic Products & TechnologyElectronic Products & Technology (ept.ca)

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

World Debt Clocks (usdebtclock.org)

Government is the great fiction, through which everybody endeavors to live at the expense of everybody else.

Frederic Bastiat.

Posted by Graeme Irvine at 06:10

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