Baltic
Dry Index. 1386 -12
Brent Crude 61.03
Spot Gold 3230 US 2 Year Yield 3.60 -0.05
US Federal Debt. 36.792 trillion!!!
There is no sin so great as ignorance. Remember this.
Rudyard Kipling
With much of the world’s markets closed today for Mayday, it’s usually time for the bulls to run riot in the few stock casinos remaining open.
In the real economy, the US economy contracted, the Fed’s favourite inflation gage was tame but Goldie expects Trump’s tariff wars to cause it to increase by about one percent.
The crude oil price and gold fell in expectation of an arriving US led global recession. I think a near global depression far more likely by H2 25.
Japanese and Australian markets rise following
choppy trade on Wall Street; most Asian markets closed for holiday
Published Wed, Apr 30 2025 7:44 PM EDT
Japanese and Australian markets rose
Thursday after swings on Wall Street overnight, as data pointing to a
contraction in the U.S. economy in the first quarter heightened investors’
fears of a looming recession.
Several Asia-Pacific
markets, including South Korea, Hong Kong, China and India were
closed for the Labor Day holiday.
Japan’s benchmark Nikkei 225 rose by 0.92% in
choppy trade while the broader Topix index climbed 0.28% after the
country’s central bank held
interest rates steady at 0.5% in a unanimous vote.
Yields on 10-year Japanese Government
Bonds (JGBs) fell sharply by 4.3 basis points to 1.269% following the Bank of
Japan’s decision. Meanwhile, yields on 20-year JGBs fell 2.5 basis points to
2.210%
The Japanese yen depreciated 0.45% against
the U.S. dollar to 143.43.
Over in Australia, the S&P/ASX 200 benchmark
was up 0.14% at 8,137.4.
The country’s surplus on trade goods
widened sharply to 6.9 billion Australian dollars ($4.42 billion) in March,
from a revised reading of 2.85 billion Australian dollars the month before.
The latest number is well above the 3.9
billion Australian dollar surplus forecast in a Reuters poll and comes as iron
ore exports recovered from weather disruptions and gold shipments
climbed, data released by the Australian Bureau of Statistics on
Thursday showed.
In this time, Australia’s exports jumped
7.6% year-on-year, while imports declined 2.2%.
U.S. futures
jumped after two of the so-called “Magnificent Seven” stocks — Meta Platforms and Microsoft — posted their
quarterly results.
In extended trading, shares of Meta
advanced more than 4% on stronger-than-expected revenue
in the first quarter. Meanwhile, Microsoft’s shares surged 8%, after
delivering better-than-expected
results on the top and bottom lines in the fiscal third quarter, as
well as strong results from its Azure cloud business and upbeat guidance.
Overnight
stateside, the S&P 500 and
the 30-stock Dow Jones
Industrial Average notched their seventh consecutive winning day
despite the volatility.
The broad-based market index advanced
0.15% to close at 5,569.06, while the Dow Jones index added 141.74 points, or
0.35%, settling at 40,669.36.
Meanwhile, the Nasdaq Composite ended the
day flat at 17,446.34.
Asia
markets live updates: Japanese and Australian stocks rise
U.S. economy shrank 0.3% in the first quarter as
Trump policy uncertainty weighed on businesses
Published Wed, Apr 30 2025 8:30 AM EDT
The U.S. economy contracted in the first
three months of 2025, fueling recession fears at the start of President Donald
Trump’s second term in office as he wages a potentially costly trade war.
Gross
domestic product,
a sum of all the goods and services produced from January through March, fell
at a 0.3% annualized pace, according to a Commerce Department report Wednesday
adjusted for seasonal factors and inflation.
Economists surveyed by Dow Jones had been
looking for a gain of 0.4% after GDP rose by 2.4% in the fourth quarter of
2024. However, over the past day or so some Wall Street economists changed
their outlook to negative growth, largely due to an unexpected rise in imports
as companies and consumers sought to get ahead of the Trump tariffs implemented
in early April.
Indeed, imports soared 41.3% for the
quarter, driven by a 50.9% increase in goods. Imports subtract from GDP, so the
contraction in growth may not be viewed as negatively given the potential for
the trend to reverse in subsequent quarters. Imports took more than 5
percentage points off the headline reading. Exports rose 1.8%.
Consumer spending slowed during the period
but was still positive. Personal consumption expenditures increased 1.8% for
the period, the slowest quarterly gain since Q2 of 2023 and down from a 4% gain
in the prior quarter.
Moreover, private domestic investment
soared during the period, rising 21.9%.
Stock market futures slipped following the
report while Treasury yields moved higher.
Key Inflation Measure Slowed To Multiyear Low In
March—But Tariff Bump On The Horizon
April 30, 2025
Topline
Inflation moderated as expected in March,
according to data released Wednesday morning, with President Donald Trump’s
tariffs looming large as many economists expect the trade policy to complicate
the slow burning descent toward historically palatable inflation.
Key Facts
The Commerce Department’s personal
consumption expenditures (PCE) index rose 2.3% from March 2024 through last
month, slightly exceeding consensus economist forecasts of 2.2% headline PCE
inflation.
Core PCE inflation, the Federal Reserve’s
preferred inflation measure as it excludes often volatile food and energy
expenditures, was 2.6% in March, matching estimates of 2.6%.
Core PCE inflation was its mildest since
March 2021 last month, though it remains above the Fed’s 2% goal as it has been
since early 2021.
Headline PCE decreased less than 0.1% from
February to March on a seasonally adjusted basis and core PCE climbed less than
0.1% last month, in line with projections of no headline increase and a 0.1%
core increase.
What We Don;t Know
How Trump’s trade war will impact
inflation moving forward. Trump wrote to
social media last week he believes “there is virtually No Inflation.” But
economists view tariffs as inflationary, projecting inflation to tick back up
as the levies take hold. Goldman Sachs economists project core PCE inflation
will come up nearly a full percentage point to 3.5% in August, which would mark
the worst inflation since September 2024.
----What To Watch For
The Fed’s rate-setting Federal Open Market
Committee will meet May 6-7. Trump has repeatedly demanded the
central bank lower rates, but financial markets aren’t so confident. Traders
price in just 9% odds of a rate cut at the May conclave, according to
CME Group’s FedWatch Tool tracking derivatives contracts betting on monetary
policy decisions.
Key Inflation Measure Slowed To Multiyear Low In March—But Tariff Bump On The Horizon
In other news.
Homebuyer mortgage demand drops further, as
economic uncertainty roils the housing market
Published Wed, Apr 30 20257:00 AM EDT
Mortgage rates didn’t move much last week,
but homebuyers continued to pull back amid concerns over the broader economy.
Applications for a mortgage to purchase a
home dropped 4% last week compared with the previous week, according to the
Mortgage Bankers Association’s seasonally adjusted index. Volume was just 3%
higher than the same week one year ago, even though interest rates last year
were considerably higher.
The average contract interest rate for
30-year fixed-rate mortgages with conforming loan balances, $806,500 or less,
decreased to 6.89% from 6.90%, with points increasing to 0.67 from 0.66,
including the origination fee, for loans with a 20% down payment. That rate is
40 basis points lower than the same week one year ago.
“Mortgage application activity,
particularly for home purchases, continues to be subdued by broader economic
uncertainty and signs of labor market weakness, dropping to the slowest pace
since February,” said Joel Kan, MBA’s vice president and deputy chief
economist. “With slowly-increasing housing inventory in many markets and
first-time homebuyers still in the mix, FHA purchase applications fared better
with only a slight decline.”
Applications to refinance a home loan
dropped 4% for the week and were 42% higher than the same week one year ago.
“Refinance activity dipped again, as
mortgage rates remained close to 7%, and borrowers hold out for a bigger
decline in rates. Given the pullback in refinancing, the average loan size for
refinances declined to just under $290,000, the lowest level in three months,”
Kan added.
Homebuyer mortgage
demand drops further, as economic uncertainty roils the housing market
HSBC becomes latest brokerage to cut S&P 500
annual target below 6000 mark
29 April 2025
(Reuters) - HSBC on Tuesday became the
latest global brokerage to slash its year-end target for the S&P 500 index
below the 6000 mark, weighed down by slower U.S. economic growth and
tariff-related pressure on corporate earnings.
The London-based brokerage cut its target
to 5600 from 6700, which is in line with BofA Global Research's forecast.
"Nearer term, the market should trade
between recession and stagflation fears until the Fed cuts and tariff turmoil
subsides," said HSBC strategists in a note.
Global brokerages have been aggressively
revising their targets for the benchmark index following Trump's evolving
tariff policy as they are expected to dent corporate America's earnings and
push the U.S. economy into a likely recession.
The widely tracked U.S. benchmark index
has fallen 6% so far this year.
"Uncertainty should cap valuations
given the lack of visibility to long-term earnings growth," HSBC said, as
it trimmed its earnings-per-share estimate for the index by 5% to $255, which
is below the consensus expectations of $264.
The brokerage's base case for this year is
that the world's largest economy will avoid both a recession and stagflation.
On a quarterly basis, it forecasts GDP
growth of 1% for the year and expects the Federal Reserve to deliver its next
rate cut in June.
Given the uncertain macro backdrop, HSBC
prefers defensive stocks that include large caps and value stocks.
HSBC becomes
latest brokerage to cut S&P 500 annual target below 6000 mark
U.S. and Ukraine sign economic deal that includes
terms for natural resources in the war-torn country
Published Wed, Apr 30 2025 8:04 PM EDT
The White House announced Wednesday night
that it signed an economic partnership with Ukraine that includes an
agreement on the ownership and extraction of natural resources from the
war-torn nation.
Treasury Secretary Scott Bessent said the
agreement, established as the United States-Ukraine Reconstruction Investment
Fund, will allow the U.S. to “invest alongside Ukraine” to unlock its growth
assets and ultimately accelerate its economic recovery.
“As the President has said, the United
States is committed to helping facilitate the end of this cruel and senseless
war. This agreement signals clearly to Russia that the Trump Administration is
committed to a peace process centered on a free, sovereign, and prosperous
Ukraine over the long term,” Bessent said. “President Trump envisioned this
partnership between the American people and the Ukrainian people to show both
sides’ commitment to lasting peace and prosperity in Ukraine.”
“To be clear, no state or person who
financed or supplied the Russian war machine will be allowed to benefit from
the reconstruction of Ukraine,” he added.
Yulia Svyrydenko, Ukraine’s economy
minister, provided more details on the minerals deal outlined in the agreement,
first noting in
a post on X that “it is the Ukrainian state that determines what and
where to extract” and that “subsoil remains under Ukrainian ownership.”
Ukraine and the U.S. will jointly manage
and maintain co-ownership of the investment fund, with neither side holding a
dominant vote, Svyrydenko said. It will be financed by new Ukrainian oil, gas
and critical mineral licenses, with 50% of all revenue from the licenses going
toward the fund.
Svyrydenko indicated in her post that the
U.S. will also contribute to the fund, through it is unclear exactly how much.
Finally, they can resist anything except
temptation.
Paris cafes caught pouring cheap wine after
customers pay for posh plonk
29 April 2025
Cafes in tourist areas of Paris have been
caught covertly pouring cheap wine in place of
the premium glasses paid for by diners.
An investigation by Le
Parisien newspaper
found that wine fraud is rife in the French capital,
with tourists often being the victims.
The outlet claims cafes are replacing
fancy wines with budget alternatives. They discovered the fraud when sending
two sommeliers to taste out the deception while pretending to be tourists.
Of the wine ordered by the glass,
investigators said that a pour of chablis or sancerre at around €9 (£7.65) was
substituted for a sauvignon, the cheapest wine on the menu at around €5
(£4.25).
One of the undercover sommeliers, wine
merchant Marina Giuberti, found a €7.50 sancerre had been replaced by a cheaper
sauvignon priced at €5.60, but she was charged the higher rate.
After complaining, the waiter brought her
another glass of the wrong wine.
Giuberti said: “It’s a pity for the
customer and for the image of the wine appellation, for the winemaker and for
the restaurant owners who do a good job.”
Staff at brasseries and cafes in Paris
confirmed that the practice is often encouraged by bosses looking to maximise
their profits.
Sarah, a waitress with 30 years of
experience working in restaurants, told Le Parisien: “I might put
leftover wine in a single bottle for happy hour, or replace Bardolino with
Chianti, which is much cheaper and tastes completely different.”
The “repotting” technique involves
switching out the wine a customer has ordered with the contents of a more
budget bottle.
A former employee of a Montmartre
brasserie, Tristan, added that staff were “told off by the owner if the most
expensive bottle went down too quickly”, and only once did a sommelier customer
discover the ruse.
According to the hospitality worker, aside
from French locals, “all other customers were getting ripped off”.
He said: “When I saw American tourists
arriving on the terrace, I knew they were going to be had.”
Experts told Le Parisien that,
by law, customers can insist on having wine poured from the bottle in front of
them with the label visible.
Jérôme Bauer, Alsace winemaker and leader
of the National Confederation of AOC (appellation contrôlée), told the outlet:
“Cheating the customer rebounds on us, the producers, because a customer who
has ordered a Côte du Rhône and gets served a Bordeaux wine will probably be
disappointed and can turn away from that wine in the future.”
Paris cafes caught
pouring cheap wine after customers pay for posh plonk
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.
UPS
says it is cutting 20,000 staff and shuttering over 70 facilities
April
29, 2025
UPS
plans to slash 20,000 jobs this year as part of a cost-cutting drive amid the
shifting global trade landscape triggered by President Donald Trump's tariffs.
"Given
the current macro-economic uncertainty, the company is not providing any
updates to its previously issued consolidated full-year outlook," the
company said.
Its
supply chain business suffered the most last quarter, with revenue plunging
nearly 15%, primarily due to the divestiture of Coyote Logistics.
The
cost-cutting drive comes after UPS told investors earlier this year it would
reduce its Amazon business by 50% by mid-2026, citing profitability reasons.
"This
was not their ask," Tomé said on an investor call in January. "This
was us. This was UPS taking control of our destiny."
On
Tuesday, UPS said the restructuring could expand depending on further network
review. In the first quarter, it said it made $80 million in savings and booked
$23 million in related costs.
UPS says it is
cutting 20,000 staff and shuttering over 70 facilities
Mass
layoffs in trucking and retail coming – Apollo
Monday,
April 28, 2025
Apollo Global
Management forecasts a severe U.S. recession triggered by
recent tariffs, which will lead to widespread layoffs in the trucking and
retail sectors amid rising economic uncertainty.
The
report, available on Apollo’s website, paints a grim scenario:
The
trucking industry, critical to U.S. logistics, faces significant challenges as
tariffs disrupt trade, particularly with China. A sharp decline in container
ship voyages from China is expected to reduce freight volumes, thereby lowering
demand for trucking services. Imports account for an estimated 20% of U.S.
trucking volumes, so a decline in imports will have a significant impact on the
industry. With fewer goods to transport, carriers will face reduced workloads
and underutilized fleets, forcing them to cut labor costs.
Apollo
predicts that domestic freight activity will sharply slow by mid-May, with mass
layoffs likely to follow as firms strive to maintain financial stability. The
slowdown in trucking will put a lot of pressure on trucking companies that have
been dealing with the Great Freight Recession, one of the longest and deepest
downturns in history.
The
retail sector is also bracing for substantial layoffs. Tariffs will cause
supply chain disruptions, leading to inventory shortages, especially for goods
from China. The decline in
container shipments will
leave retailers struggling to stock products, as longer lead times further
complicate inventory management. Retailers may need to find alternative
suppliers or reduce product offerings, both of which present challenges.
Retailers
also face declining consumer confidence driven by economic fears and
tariff-induced inflation. Record-low consumer confidence scores reflect
cautious spending, particularly on non-essential items, resulting in reduced
store traffic and sales. Companies like Chipotle and Southwest Airlines have
noted that consumers are saving more due to economic concerns. Rising credit
card delinquencies and minimal payments indicate financial strain among
consumers, further reducing purchasing power and exacerbating retail sales
declines. Apollo expects retailers to cut jobs in June, amidst declining demand
and higher costs.
Apollo’s
broader economic outlook highlights a sharp decline in corporate spending, with
new orders falling and inventories rising before tariffs took effect. Companies
are lowering earnings forecasts and cutting investments due to a gloomy
economic outlook, increasing the likelihood of layoffs across other industries.
The tariff-driven slowdown could lead to stagflation—stagnant growth combined with high inflation—according to Apollo’s analysis. Unlike typical recessions, where falling demand reduces inflation, trade disruptions are expected to drive up costs. Federal Reserve surveys indicate rising prices across supply chains, squeezing consumer purchasing power as incomes stagnate. Low consumer and business confidence, coupled with cautious spending, heightens the risk of stagflation.
Declining
consumer confidence is mirrored by reduced corporate spending and investment.
As firms anticipate weaker demand, they are scaling back capital expenditures
and revising earnings downward, reinforcing economic stagnation. This response
reflects both immediate cost pressures and a longer-term adjustment to a
trade-restricted economy.
Apollo
warns that rising prices and sluggish growth will heavily burden businesses and
consumers. This stagflation scenario poses policy challenges, as traditional
monetary tools may struggle to curb inflation while supporting growth.
Strategic interventions are needed to mitigate the impact on vulnerable sectors
and communities.
Apollo’s
forecast paints a grim picture for the U.S. trucking and retail industries.
Tariffs are disrupting supply chains and consumer behavior, putting both
sectors at risk. Layoffs are often viewed as a necessary step to manage rising
costs and minimize losses. Apollo’s analysis serves as a critical warning,
urging strategic preparations to navigate the impending economic storm.
Mass layoffs in
trucking and retail coming - Apollo - FreightWaves
Covid-19
Corner
This section will continue only occasionally when something of interest occurs.
New
antiviral compounds show broad protection against COVID-19 variants
30
April 2025
AVI-4773
and related MPro inhibitors outperform existing treatments like nirmatrelvir in
preclinical studies, offering a promising path toward pan-coronavirus
therapies.
Since
the start of the coronavirus disease 2019 (COVID-19) pandemic, numerous novel
antiviral therapeutic agents have been developed to target key proteases
involved in severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2)
replication. Nirmatrelvir and ensitrelvir, for example, are main protease (Mpro)
inhibitors that are currently approved for the clinical treatment of COVID-19.
The
continuous emergence of highly transmissible, pathogenic, and immune-evading
SARS-CoV-2 variants has weakened the efficacy of existing
antiviral agents. Moreover, the looming threat of future pandemics due to
coronaviral reservoirs in bats and other small mammals emphasizes the
importance of identifying novel therapeutics with pan-coronavirus activity.
A
recent study published in Science Advances reports the
recent discovery of Mpro inhibitors that exhibit broad activity
against SARS-CoV-2 and other coronaviruses.
Building
the scaffold
Previously,
the researchers of the current study screened 862 million custom molecules
against the SARS-CoV-2 Mpro structure, which led to the
identification of several scaffolds with micromolar inhibitory activity.
AVI-1084, for example, exhibited a median inhibitory concentration (IC50)
of 29 μM.
This
scaffold was subsequently used to contract a library of over 17,000 analogs
that were evaluated for their binding activity to and docking into Mpro.
Seven of these analog compounds exhibited in vitro Mpro activity,
the most potent of which was AVI-3570 with an IC50 of 1.5 μM.
The improved potency of these compounds was attributed to fluoro- and chloro-
substitutions in the thiophene ring of AVI-1084 that increased their
interactions with the Mpro S2 pocket.
However,
none of the seven identified compounds were capable of modifying the key
pyridinone group occupying the S1 pocket. When an isoquinoline group was used
to replace the pyridinone ring, AVI-3318 was created and found to be 50-fold
more potent than AVI-1084.
X-ray
crystallography of the AVI-3318-MPro complex provided similar
results to the docking simulation assay and confirmed all hypothesized major
interactions between the compounds and both the S1 and S2 pockets of Mpro.
Additional structure-activity relationship (SAR) expansion involved adding
various side chains at the remaining two positions of the dihydrouracil core in
an effort to further improve compound potency.
AVI-4303,
which is a C5 benzotriazole analog, exhibited ten-fold higher potency than
AVI-3318. Comparatively, N1 propargyl analogs including AVI-4516 and
AVI-4773 successfully bound to the S1 site with a nanomolar IC50,
which is 100-fold more potent than the des-propargyl molecule AVI-4375, which
had an IC50 of 7.4 μM.
More
New antiviral
compounds show broad protection against COVID-19 variants
China
releases white paper on COVID-19 origins tracing: Report
The next step in origin-tracing work should focus on the U.S., China's National Health Commission said
April
30, 2025 / 13:31 IST
China
released a white paper on COVID-19 prevention, control and origins tracing on
Wednesday, the state-run Xinhua news agency reported, lauding its own
contributions while casting doubts on the United States.
The
next step in origin-tracing work should focus on the U.S., China's National
Health Commission said according to Xinhua.
The
U.S. should not continue to "pretend to be deaf and dumb", but should
respond to the legitimate concerns of the international community, the white
paper said.
China releases white paper on COVID-19 origins tracing: Report
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.
Did Spain’s push for renewable energy have any impact on its mass
power blackout?
30 April 2025
The mass electrical blackout across Spain, Portugal and parts of France sparked hours of chaos before power
returned – with the after-effects still being felt.
Both Spain and Portugal’s power grid operators have ruled out a
cyber attack, but the cause of the outage is still under investigation.
In a span of just five minutes, between
12.30pm and 12.35 pm local time on Monday, solar PV generation plunged by more
than 50 per cent to 8 gigawatts (GW) from more than 18 GW, the data showed.
There have been reports that a lack of
“inertia” in the grid may have contributed to the blackout. Grid inertia helps
maintain electricity supplies at a stable frequency, and is created by
generators with spinning parts – such as turbines running in fossil fuel
generators or hydropower – which solar panels and wind turbines do not have. In
a blackout, you need to rebuild inertia before bringing things back online.
Speaking to The Independent, Kristian Ruby, secretary
general of European electricity industry group Eurelectric, suggested that
there was a technical problem in a high voltage cable linking the French and
Spanish grid, which is known as an interconnector.
However, Mr Ruby warned that it would take
“weeks, if not months” for there to be a proper technical analysis confirming
what went wrong, and he added that it is unlikely that such alone would have
caused the problem.
“The power system is perhaps the most
advanced and complex machine that we have in the world,” he explained. “It’s a
combination of millions of different units that are injecting power into the
same system, which transports it out to millions of end-users.
More
Did Spain’s push
for renewable energy have any impact on its mass power blackout?
Next, the
world global debt clock. Nations debts to GDP compared.
World Debt
Clocks (usdebtclock.org)
Beware
of false knowledge; it is more dangerous than ignorance.
George Bernard Shaw
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