Archive for April, 2020

• Morning News: April 17, 2020
  Eddy Elfenbein, April 17th, 2020 at 7:04 am

  China’s Economy Retreats, With Pandemic Causing Biggest GDP Drop In Decades

  Humbled Greeks Show the World How to Handle the Virus Outbreak

  Futures Jump on Trump’s Restart Plan, Coronavirus Drug Hopes

  U.S. Loan Program Hits $350 Billion Cap Leaving Thousands of Small Businesses Adrift

  Straggling in a Good Economy, and Now Struggling in a Crisis

  Cantor to Cut Hundreds of Jobs in Break From Wall Street Pledge

  When Even Amazon Is Sold Out of Exploding Kittens

  With Fishing Fleets Tied Up, Marine Life Has a Chance to Recover

  Mask-Maker 3M Files Lawsuits Against Alleged Price-Gougers

  Nick Maggiulli: What is the Average Net Worth by Age and Education Level? & Death of a Value Investor

  Joshua Brown: The Next Leg Down Will Involve Credit Cards & Why the Stock Market Hasn’t Even Gotten Cheap Yet

  Roger Nusbaum: Have We Entered A Post Americanism World?

  Jeff Miller: The Irrelevance of Financial News

  Ben Carlson: What Could Cause Another Leg Down in the Stock Market?

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• Another Terrible Jobless Claims Report
  Eddy Elfenbein, April 16th, 2020 at 1:46 pm

  We got another jobless-claims report and it was another bad one. All told, 5.245 million Americans signed up for first-time jobless claims. Also, last week’s figure was revised higher a bit. That brings the four-week total to 22 million. The key question is how many people will be rehired once the economy reopens.

  The total was a bit worse than the 5 million expected from economists surveyed by Dow Jones.

  Though the most recent count, for the week ended April 11, represented a drop from the previous two weeks, it showed that the damage to the U.S. labor market remains profound.

  “As we fully know the current state of the labor market with mass waves of layoffs, the key question turns to how many of these people will be rehired when the economy starts to reopen,” said Peter Boockvar, chief investment officer at the Bleakley Group. “We can assume it will take a long time for that to happen but hopefully we’re getting closer to at least getting started.”

  The S&P 500 is up a little bit today. We’re close to having our highest close since March 9.

  

• Morning News: April 16, 2020
  Eddy Elfenbein, April 16th, 2020 at 7:14 am

  It’s the End of the World Economy as We Know It

  Bonds Started to Falter. Then, the Fed Came to the Rescue

  The Fed Loves Main Street as Much as Wall Street This Time

  The Economic Data is Even Worse Than Wall Street Feared: ‘The Economy is Clearly in Ruins Here’

  American Jobs Collapse Worsens With Gig Workers Stuck in Limbo

  U.S. to Issue New Social Guidelines as Jobless Figures Are Set to Soar

  Wells Fargo, BofA and JPMorgan Grant Overdraft Relief As Stimulus Checks Roll In

  Some Banks Keep Customers’ Stimulus Checks if Accounts Are Overdrawn

  Apple Developing High-End Headphones With Interchangeable Parts

  Apple’s New Budget iPhone Unlikely to Make Splash in China Where 5G Now Commonplace

  Carnival Executives Knew They Had a Virus Problem, But Kept the Party Going

  Ben Carlson: Personal Finance During a Crisis

  Michael Batnick: This Is Why We’re Angry & Animal Spirits: Mountains of Debt

  Cullen Roche: Three Things I Think I Think – (Mo Ron)a

  Howard Lindzon: Everything You EVER Needed to Know About Trading and Investing in Two Minutes

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• Some Ugly Headlines
  Eddy Elfenbein, April 15th, 2020 at 10:53 am

  There are a lot of ugly headlines today.

  Homebuilder confidence posted its biggest drop on record. The number fell from 72 to 30. Expectations were for 55.

  Retail sales fell 8.7% last month. That’s also the biggest drop on record which goes back to 1992.

  Industrial production had its biggest drop since 1946. Last month, IP fell 5.4%.

  The Dow is currently down 600 points.

• Morning News: April 15, 2020
  Eddy Elfenbein, April 15th, 2020 at 7:12 am

  Oil Slumps Below $20 as IEA Sees Global Storage Filling Despite Cuts

  Oil In the Age of Coronavirus: A U.S. Shale Bust Like No Other

  I.M.F. Predicts Worst Downturn Since the Great Depression

  China Blasts Trump’s Move to Pull WHO Funding, Pledges Support

  How the Government Pulls Coronavirus Relief Money Out of Thin Air

  Larry Kudlow’s War Bonds Are Coming But in a Plain Vanilla Wrapper

  Wall Street’s Biggest-Ever China Bet Rides on These Bankers

  There Are Limits to Boldly Easing Bank Rules in Coronavirus Pandemic

  Analysts Expect Bleak U.S. Retail Sales Data

  Crippled Airline Industry to Get $25 Billion Bailout, Part of It as Loans

  Amazon Plans to Appeal French Ruling Limiting Trade to Essential Goods

  UnitedHealth Beats Quarterly Profit on Strength Across Businesses

  Ben Carlson: The Stock Market is Not Your Benchmark

  Roger Nusbaum: Be Ready For The Rally To Falter

  Howard Lindzon: From Panic With Friends To Frothy With Friends…Life and Markets Come At You Fast

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• Twenty Years After the Nasdaq Cracked
  Eddy Elfenbein, April 14th, 2020 at 12:42 pm

  Twenty years ago today, the Nasdaq plunged. It had already backed off its peak, but on April 14, the selling became intense.

  From CNN:

  U.S. stocks plummeted Friday, capping off five days of stunning losses that handed the Nasdaq composite index its worst weekly performance of all time and the Dow Jones industrial average its steepest one-session point loss in history.

  The Dow tumbled more than 600 points, trouncing the previous record and triggering circuit breakers at the New York Stock Exchange. The sell-off gave the Nasdaq its biggest point loss of all time, topping the last No. 1 plunge set just five days ago.

  But the statistical standout could be this: the Nasdaq fell more than 25 percent this week, trouncing the 19 percent fall that began Oct. 21, 1987, Black Monday.

  Friday’s plunge came after the government said prices at the consumer level showed surprising strength last month, triggering fears that the Federal Reserve may raise interest rates more aggressively.

  The Nasdaq composite index shed 355.61 points, or over 9 percent, to 3,321.17, its biggest one-day decline on record. At one point during the trading session, the Nasdaq was down 411 points. The index lost over 1,000 points this week and is now off more than 34 percent from its record high set March 10 – well beyond the 20 percent decline Wall Street sees as the beginning of a bear market.

  Meanwhile, the Dow Jones industrial average skidded 616.23 points to 10,307.32, off over 5 percent, but an improvement from its 722-point drop in the last hour of trading. The broader S&P 500 index fell 83.20 to 1,357.31.

  That was only the beginning. The Nasdaq wouldn’t hit bottom for another three years.

  The good news for us is that the stock market is rebounding today. The S&P 500 is on pace for its highest close in a month. Some major banks reported Q1 earnings this morning. The results were pretty bad, as expected, but the banking sector is holding up somewhat well. Among the mega-caps, Walmart and Amazon are at all-time highs this morning.

  Yesterday was a frustrating day for investors. The market had gains from very few stocks while most stocks did poorly. I counted 372 stocks in the S&P 500 that trailed the index yesterday.

  Today is much better. In fact, shares of Silgan (SLGN) aren’t far from a new 52-week high.

• Morning News: April 14, 2020
  Eddy Elfenbein, April 14th, 2020 at 7:18 am

  The Big Deal to Cut Oil Production May Not Be Big Enough

  Stock Markets Rise on Positive Chinese Trade Data

  China Weighs Merging Its Biggest Brokers to Take on Wall Street

  Trump’s Ambition to Reopen U.S. Hinges on Elusive Testing Surge

  Economic Pain Will Persist Long After Lockdowns End

  Pandemic Survival Plans: U.S. Businesses Scramble to Conserve Cash, Boost Liquidity

  ‘This Is Going to Kill Small-Town America’

  U.S. Meat Supply Is ‘Perilously Close’ To A Shortage, CEO Warns

  Amazon Puts New Grocery-Delivery Customers On Hold As Demand Explodes

  Hedge Fund Managers Are Claiming Bailouts as Small Businesses

  A Disaster Brewed for Years in the Postal Service. The Coronavirus Has Engulfed It In Crisis.

  Ben Carlson: Why This Crisis is Going to Make Wealth Inequality Even Worse

  Michael Batnick: Talk Your Book: Investing in Art With Masterworks

  Cullen Roche: Dataroom and Biotechnology

  Joshua Brown: Let’s Not Make Things Worse

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• NYT on Bob Iger
  Eddy Elfenbein, April 13th, 2020 at 9:35 am

  The New York Times has a very flattering article on Robert Iger, the former CEO of Disney (DIS). Mr. Iger thought he was leaving the spotlight earlier this year but he remains a major force inside Disney at a crucial time for the company.

  But Disney’s much-imitated model was almost perfectly exposed to the pandemic. The shift from on-screen entertainment into in-person experiences helped Disney become the biggest media company in the world. But those businesses have been impossible to protect from the pandemic. The company’s largest division brought in more than $26 billion in the year ending last June by extending its brands to cruise ships and theme parks. Those are all shuttered now. It has three new cruise ships under construction in Germany, their futures unclear. The jewel in its second largest division, television, is ESPN, which in a sports-less world is now broadcasting athletes playing video games. The third group, studio, had expected to bring in most of its revenue from movie openings in theaters, which are now closed.

  There has been a glimmer of good news in the introduction of Disney+. The company’s troubled share price jumped about 7 percent in after-hours trading last Wednesday on the news that the streaming service had attracted 50 million subscribers. But the project is still an investment, years away from generating revenue that could replace a big movie opening in theaters. And the service is desperate for new content — at a time when television and film production has ground to a halt.

• Danaher Withdraws Guidance
  Eddy Elfenbein, April 13th, 2020 at 9:21 am

  This morning, Danaher (DNR) said it’s withdrawing its full-year earnings guidance. The company said that it expects to report Q1 revenue growth of 3%, and non-GAAP core revenue growth of 4.5%.

  President and CEO Thomas P. Joyce, Jr. said, “We anticipate positive results in each of our three reporting segments in the first quarter, with particular strength in our Cepheid, Radiometer, Pall and ChemTreat businesses. While we had a good start to the year, we saw a meaningful slowdown in demand toward the end of the quarter, particularly in our more instrument-oriented businesses, as the COVID-19 pandemic spread worldwide.”

  Joyce continued, “We are incredibly proud of our team’s response to these unprecedented challenges. We are directly contributing to the fight against this virus, providing much-needed diagnostic testing capabilities and supporting our customers in pursuit of new treatments and vaccines.”

  The earnings report will be out on May 7.

• Morning News: April 13, 2020
  Eddy Elfenbein, April 13th, 2020 at 7:35 am

  Oil Nations, Prodded by Trump, Reach Deal to Slash Production

  Oil Agreement Could Support Stocks, Providing a Floor

  Goldman Says U.S. Stocks Have Likely Bottomed

  Big Business Pledged Gentler Capitalism. It’s Not Happening in Pandemic.

  How the Virus Transformed the Way Americans Spend Their Money

  The U.S. Postal Service Has Never Been More Important, or More Endangered

  An Ancient Computer Language Is Slowing America’s Giant Stimulus

  Son’s $2 Billion Guarantee at Risk as Virus Hits SoftBank Star

  Bob Iger Thought He Was Leaving on Top. Now, He’s Fighting for Disney’s Life.

  Joshua Brown: Throwback to the Volcker Recession

  Jeff Miller: Weighing the Week Ahead: Good Questions but Poor Answers

  Cullen Roche: Fed Truthers Are Wrong (Again)

  Michael Batnick: Animal Spirits: The Fed’s Bazooka

  Roger Nusbaum: Reducing Portfolio Volatility

  Howard Lindzon: The Softbank Clause

  Jeff Carter: Some Things That Might Happen

  Ben Carlson: Pandemics vs. Post-War Recoveries, Two Reasons the Fed is So Polarizing & My New Theory About Future Stock Market Returns

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