Archives of “Economy” tag

rss

Major indices close higher led by the Dow and S&P

  
Analysis, US Market
#  #  #  #  #  #  #  #

Dow and S&P rise by 3.4%

the major indices are closing higher with the Dow and S&P leading the way. Each rose by around 3.4%. The NASDAQ index lagged behind with a 2.6% gain.
A look at the close is showing:
  • S&P index, rose by 89.86 points or 3.38% to 2749.27.
  • NASDAQ index, rose by 203.64 points or 2.58% to 8090.90
  • Dow industrial average, rose by 772.57 points or 3.41% to 23426.43

Some of the leading stocks include:

  • Wynnresort, +13.39%
  • Square, +13.29%
  • Marriott, +11.87%
  • United Airlines, +12.3%
  • General Motors, +8.6%
  • Unitedhealth +8.10%
  • Raytheon, +8.96%
  • Twitter, +8.82%
  • FedEx, +8.13%
  • Citigroup, +7.27%
  • Ford Motor’s, +6.69%
  • Morgan Stanley, +6.58%
  • Exxon Mobil +6.35%
  • Goldman Sachs +6.47%
  • Chevron +6.34%
  • American Express, +5.14%
Some laggards today included;
  • Deutsche Bank, -1.58%
  • General Mills, -1.24%
  • Alibaba, -1.10%
  • ATT, -0.70%
  • Netflix, -0.33%
  • Disney, -0.23%
  • Walmart, -0.12%

 

BlackRock on ‘unprecedented policy actions to limit the coronavirus shock’

  
  Analysis
#  #  #  #  #  #  #  #  #

BlackRock is the world’s largest asset manager (circa $7.4 trillion in assets under management)

Given the surging equity markets (more ion this in just a moment) the comments from their latest update might appear stale (ps. these below relate to a credit view, not equities) :
  • Unprecedented policy actions to limit the coronavirus shock and sharply lower valuations have improved the outlook for credit, in our view. 
  • Major central banks are committed to keep rates low and greatly expand their balance sheets. 
More specifically on stocks (bolding mine):
  • We previously downgraded global equities to neutral. The coronavirus outbreak is disrupting economic activity and supply chains. The outbreak also poses risks to corporate earnings, in our view. Accommodative monetary policy is a support. We now favour rebalancing back toward benchmark weights as markets fall.

US major indices close lower but off the low levels for the day

  
Analysis, US Market
#  #  #  #  #  #  #  #

Prices recover in the last hour of trading

The major indices are closing lower but off the low levels for the day. The last hour of trading saw prices move higher. The major indices have moved lower in 3 last 4 trading days
The final numbers are showing:
  • The S&P index fell -38.34 points or -1.52% at 2488.56. The high for the day reached 2538.18 . The low extended to 2459.96
  • the NASDAQ index fell -114.225 points or -1.53% to 7373.08. The high price reached 7518.71.The low extended to 7288.11
  • The Dow fell -357.99 points or -1.67% to 21055.49. The high price reached to 21 447.81. The low extended to 20863.09
For the week, the major indices all declined with the Dow industrial average falling the most. The changes for the week are showing:
  • Dow -2.7%
  • S&P -2.08%
  • Nasdaq -1.72%

YTD, the Dow al  so is leading the declines:

  • Dow -26.23%
  • S&P, -22.97%
  • Nasdaq, -17.83%.

US Indices run higher into the close. Major indices close near session highs

  
Analysis, US Market
#  #  #  #  #  #

Major indice rise by 1.6% to 2.2%

The US stocks ran higher into the close with the major indices rising about 0.9% more in the last hour of trading.
The final numbers are showing:
  • The S&P index rose 56.09 points or 2.28% at 2526.90
  • The NASDAQ index rose 126.73 points or 1.72% at 2487.31
  • The Dow Industrial Average rose 1 and 69.93 points or 2.24% at 21413.44
Going into the last hour of trading, the major indices were trading at:
  • S&P index up 32.81 points or 1.33% at 2503.31. The final hour added 0.95%
  • Nasdaq index up 54.859 points or 0.75% 7415.44.  The final hour added 0.97%
  • Dow up 275.64 points or 1.32% at 21219.15. The final hour added 0.92%
Some winners today included:
  • Chevron, +11.06%
  • Exxon Mobile, +7.62%
  • Morgan Stanley, +7.18%
  • Gilead, +6.09%
  • Broadcom, +5.77%
  • Nvidia, +5.16%
  • Intel, +4.80%
  • Caterpillar, +4.8%
  • IBM, +4.77%
  • Procter & Gamble, +4.62%
  • Lockheed Martin, +4.46%
  • Mastercard, +4.46%
Some losers today included:
  • Beyond Meat, -9.58%
  • United Airlines, -8.72%
  • Walgreens Boots, -6.14%
  • Slack, -5.94%
  • United Technologies, -5.92%
  • Boeing, -5.82%
  • Tesla, -5.63%
  • Delta Airlines, -4.78%

Fitch says : Deep Global Recession in 2020 as Coronavirus Crisis Escalates -Full Text

  
Analysis, Economy
#  #  #  #  #  #

Fitch Ratings-London-02 April 2020: A deep global recession in 2020 is now Fitch Ratings’ baseline forecast according to its latest update of its Global Economic Outlook (GEO) forecasts.

The speed with which the coronavirus pandemic is evolving has necessitated another round of huge cuts to our GDP forecasts. We now expect world economic activity to decline by 1.9% in 2020 with US, eurozone and UK GDP down by 3.3%, 4.2% and 3.9%, respectively. China’s recovery from the disruption in 1Q20 will be sharply curtailed by the global recession and its annual growth will be below 2%.

“The forecast fall in global GDP for the year as a whole is on a par with the global financial crisis but the immediate hit to activity and jobs in the first half of this year will be worse”, said Brian Coulton, Fitch’s chief economist.

The spread of the pandemic and the actions necessary to control it mean that we now have to incorporate full-scale lockdowns across Europe and the US (and many other countries) in our baseline forecasts. This was not the assumption used in our March 2020 GEO forecast. There are many moving parts, but we now judge that lockdowns could reduce GDP across the EU and US by 7% to 8%, or 28% to 30% annualised, in 2Q20. This is an unprecedented peacetime one-quarter fall in GDP and is similar to what we now estimate occurred in China in 1Q20.

On the assumption that the health crisis is broadly contained by the second half of the year there should be a decent sequential recovery in activity as lockdowns are removed, some spending is re-profiled from 1H20, inventories are rebuilt and policy stimulus takes effect. But this has to be set against the many factors amplifying the depth of the dislocation, including job losses, capex cuts, commodity price shocks and the rout in financial markets.

“Our baseline forecast does not see GDP reverting to its pre-virus levels until late 2021 in the US and Europe,” said Coulton.

 

(more…)

Indonesia central bank says in discussion with Fed for possibility of swap, repo lines

  
  Analysis
#  #  #  #  #  #  #  #  #

The dollar squeeze in emerging markets is where the problem is at

Indonesia is one of the EM countries where they have higher dollar-denominated debt than they do FX reserves. That is not a good spot to be in during this kind of market environment.

The swap lines offered by the Fed is good to address the needs by local banks on the receiving end as they start to run empty on dollars.
However, the true value of the Fed’s liquidity measures relies on how banks can also help get these dollars to corporates for their working capital requirements or cash buffers.

How effective is all of this remains to be seen but at least there is no reoccurrence of the dollar panic that we saw a few weeks back so that is something I guess.

Deficit discipline is dead

  
  Analysis
#  #  #  #  #  #

Debt is no longer a four-letter word

The legacy of the coronavirus crisis may be that it kills the idea that deficits matter.
The Tea Party derailed Obama’s legislative agenda, lamenting high deficits. At least 12 Senators and at least 50 members of the House were elected on Tea Party platforms. These were the most-hardcore deficit hawks in history.
Trump vaulted himself to the White House by tapping Tea Party sentiment. Here’s a sample:
For reference, the combined deficit in Obama’s final four years was $2.19 trillion.
Yesterday, Trump tweeted this:
tweet
The deficit in the US this year will be at least $3 trillion and probably $4 trillion.
I’m not here to point out they hypocrisy, you can get the anywhere.

(more…)

Dow leads the decline in stocks. Dow posts worst Q1 ever.

  
Analysis, US Market
#  #  #  #  #  #  #

Dow & S&P worst month since 2008. S&P falls -20% for the quarter. All indices are in the red going back a year.

The US stocks are ending the day with declines across the board but by differing degrees.
For the month, the Dow and S&P had the worst month since 2008. The Dow posted the worst Q1 ever.  The S&P fell an even -20.00% for the quarter (which is a bit ironic).
The final numbers are showing:
  • S&P index fell -42.06 points ro -1.6% at 2584.59
  • Nasdaq index fell -74.05 points or -0.95% at 7700.10
  • Dow index fell -410.32 points or -1.84% at 21917.16
For the month, the major indices are showing:
  • S&P index fell -12.51%
  • NASDAQ index fell -10.12%
  • Dow fell -13.74%
For the quarter, the final numbers for the 1Q are showing:
  • S&P index fell -20.00%
  • NASDAQ index fell -14.18%
  • Dow fell -23.2%
Going back 1 year, all the major indices are now showing declines
  • S&P index, -8.81%
  • NASDAQ index, -0.38%
  • Dow industrial average, -15.47%

US stocks close near session highs. Solid day higher.

  
Analysis, US Market
#  #  #  #  #  #

Broad indices move up over 3% on the day

The US stocks moved up to a new session high but backed off just a bit into the close.  It was still a solid day higher.
The major indices are closing at:
  • S&P index rose 5.02 points or 3.35% to 2626.49.
  • Nasdaq index rose 271.77 points or 3.62% tp 7774.15.
  • Dow industrial average rose 688.32 points or 3.18% to 22325.10.
Although the price extended to new session highs in the major indices during the last hour, the volatility was a bit less than recent history. The snapshot at 3 PM showed:
  • S&P index up 70.44 points or 2.77% at 2611.91. The index moved up to a high of 2631.80 in the last hour.
  • NASDAQ index +225.28 points or 3.0% at 7727.66. The index moved up to a high of 7784.34 in the last hour
  • Dow up 526.39 points or 2.43% at 22163.12. The index moved up to a high of 22378.09 in the last hour.
Some winners today included:
  • Johnson & Johnson, +7.9%
  • Merck, +7.45%
  • Microsoft, +7.15%
  • Intel, +5.98%
  • Caterpillar, +5.88%
  • Facebook, +5.77%
  • Pfizer, +5.76%
  • Chubb, +5.32%
  • Nvidia, +5.15%
  • Coca-Cola, +5.04%
  • Walmart, +5.04%
  • Phillip Morris, +4.74%
  • IBM, +4.54%
  • General Mills, +4.42%
  • Gilead +4.30%
  • Adobe +4.22%

Some losers today included:

  • United Airlines, -8.08%
  • Boeing, -5.93%
  • Southwest Airlines -3.52%
  • Delta, -2.98%
  • Tesla, -2.43%
  • Papa John’s, -2.32%
  • Wells Fargo, -1.19%
  • Slack, -1.09%
  • Raytheon, -0.73%
  • DuPont, -0.62%
  • Lockheed Martin, -0.57%

Singapore’s central bank reduces slope of currency band to zero

  
  Analysis
#  #  #  #  #  #  #  #  #

The Monetary Authority of Singapore adjusts monetary policy for the country through currency control, not via interest rates.

MAS says it will adopt a zero percent per annum rate of appreciation of the policy band starting at the prevailing level of the SGD NEER

  • there will be no change to the width of the policy band.
  • Says this policy decision hence affirms the present level of the S$NEER, as well as the width and zero percent appreciation slope of the policy band going forward
  • core inflation is likely to remain below its historical average in the near and medium term
  • Says MAS’ money market operations will at the same time provide sufficient liquidity to the financial system
  • will continue to be vigilant over developments in the economy and financial markets, and stands ready to curb excessive volatility in the SGD NEER
  • says both MAS core inflation and CPI -all items inflation are expected to average between −1 and 0% in 2020
  • says external sources of inflation are likely to weaken in the near term amid the global downturn
  • resident unemployment rate is expected to rise and wage growth ease
more to come
Go to top