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8/30 Jobs report could prevent rate hike — but unlikely to ensure one

Administrator - Sunday, 30 August 2015 05:12

Jobs report could prevent rate hike — but unlikely to ensure one

MW-DT289_PAYEMS_20150828135126_ZH

A jobs report less than a month before a key Federal Reserve interest-rate decision is always a big deal, but the looming report on August payrolls probably can only move sentiment by central bankers in one direction.

That’s because the Fed, in official pronouncements, public speeches and interviews, has spelled out the conditions for lifting rates.

One is confidence (theirs) that inflation will return to its target. The other is for “some further improvement” in the jobs market.

Heading into the jobs report that will come out on Friday, it’s really the first sentence that is a mystery. Jobs growth already has been pretty good — averaging 212,000 new jobs each month this year. The unemployment rate has dropped all the way to 5.3% from a peak of 10% in 2009.

Inflation, on the other hand, is way below the Fed’s target of 2%-per-year growth for the PCE price index. In July, inflation by that measure was just 0.3%, and it’s been below target for the last three years.

There are alternative inflation measures where the miss isn’t so large, though still apparent. So-called core PCE — which excludes volatile energy and food prices — grew 1.2% in the 12 months ending July. What’s called trimmed mean PCE — an inflation measure where both the hottest and coldest price moves are removed — grew at a 1.6% clip in July, the Dallas Fed reported.

And neither of those indicators reflect the moves from export giant China in August to devalue its currency.

Inside the Fed, there’s a big debate about the direction of prices. In his interview with CNBC on Friday, Fed Vice Chairman Stanley Fischer said his confidence that inflation would return to target was “pretty high.” On the same network on the same day, Minneapolis Fed President Narayana Kocherlakota said the inflation outlook was so weak that an easing of policy should be considered.

All of which is to say is that the jobs report, short of a barnstorming number for either the headline, or for average worker earnings, isn’t likely to upgrade the Fed’s perspective of the labor market. But a bad number, by contrast, could lend credence to the camp who want to wait a bit longer before lifting interest rates.

Credit Suisse’s economists, for instance, are forecasting 180,000 jobs were added during the month.

“A payroll gain in line with our forecast probably would meet the FOMC’s ‘some further improvement’ criterion for a potential rate hike, especially if other data in the employment report also point to diminishing labor market slack,” their economists said in a research note.

The U.S. economics calendar will be full even without the jobs data.

Key releases will include the Institute for Supply Management’s manufacturing gauge, car sales, the Beige Book and trade data, and there will be speeches from Boston Fed President Eric Rosengren (a dove on interest rates) and Richmond Fed President Jeffrey Lacker (a hawk).  http://www.marketwatch.com/story/jobs-report-could-prevent-rate-hike-but-unlikely-to-ensure-one-2015-08-30

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ScreenHunter_554 Aug. 30 17.09
ScreenHunter_555 Aug. 30 17.09

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Jackson Hole roundup: No clear path for Fed in September http://www.marketwatch.com/story/jackson-hole-roundup-no-clear-path-for-fed-in-september-2015-08-29

8/26 Wall Street set for higher open, Dow futures up 275

Administrator - Wednesday, 26 August 2015 07:14

Wall Street set for higher open, Dow futures up 275
U.S. stock index futures pointed to a sharply higher open on Wednesday after a highly-volatile session for China’s Shanghai Composite, with investors left largely unimpressed by the stimulus measures from the People’s Bank of China.

Investors are finding it difficult to know which direction to turn, with global indices flipping wildly between gains and losses after brutal selling seen at the start of the week. China’s benchmark Shanghai Composite finished down 1.3 percent after fluctuating throughout the day. http://www.cnbc.com/2015/08/26/wall-street-volatile-as-shanghai-seesaws.html

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Experts: Here’s what happened on Tuesday

In the waning hours of Tuesday’s trading session, U.S. stocks not only gave back their gains, but ended down about 1 percent across the board amid overwhelming uncertainty about what would happen in China trading, two experts said Wednesday.

“What we saw yesterday was concern about how Asia would respond … to the rate reduction by the PBoC [People’s Bank of China],” Charles Campbell, executive director at MKM Partners, said in a CNBC “Squawk Box” interview.

U.S. equities recorded their worst reversal since October 2008, with the Dow Jones industrial average closing about 200 points lower after trading as much as 441 points higher.  http://www.cnbc.com/2015/08/26/here-is-what-happened-on-tuesday.html

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Rout latest: Europe shares sink; Shanghai seesaws
http://www.cnbc.com/2015/08/26/rout-latest-shanghai-seesaws-europe-set-for-fall.html

8/24 Tense day for Wall Street ahead as China stocks tank 8.5%

Administrator - Monday, 24 August 2015 07:46

Tense day for Wall Street ahead as China stocks tank 8.5%
Stock futures were sliding on Monday on the heels of the biggest weekly declines for Wall Street since 2011, after a major rout in Asia saw Chinese equities surrender all their gains for 2015.

Many investors expected the People’s Bank of China would take some action over the weekend to support the financial system. In the absence of any move, a brutal bout of selling overtook markets. The Shanghai Composite Index SHCOMP, -8.49% closed down 8.5%.

U.S. stock futures were flirting with lows seen during Asia trading. Futures for the Dow Jones Industrial Average YMU5, -2.90% tumbled 423 points, or 2.6%, to 16,041, while those for the S&P 500 ESU5, -2.55% dropped 44.90, or 2.3%, to 1,927. The biggest losses were setting up for tech stocks, with futures for the Nasdaq-100 NQU5, -4.33% down 167.2 points, or nearly 4%, at 4,034.  http://www.marketwatch.com/story/tense-day-for-wall-street-ahead-as-china-stocks-tank-85-2015-08-24?mod=MW_story_latest_news

8/23 U.S. stock futures drop in early trade; Dow off 139 points

Administrator - Sunday, 23 August 2015 07:36

With Disney Stock Dropping, Now is a Good Time to Buy: http://www.thestreet.com/story/13263182/1/with-disney-stock-dropping-now-is-a-good-time-to-buy.html

One Analyst Still Has Faith In Walt Disney Co As The Rest Jump Ship (DIS): http://www.smarteranalyst.com/2015/08/23/one-analyst-still-has-faith-in-walt-disney-co-dis-as-the-rest-jump-ship/

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U.S. stock futures drop in early trade; Dow off 139 points
U.S. stock futures dropped in early trade late Sunday following the worst week for stocks in four years. Futures for the Dow Jones Industrial Average YMU5, -1.00% dropped 139 points, or 0.8%, to 16328, while futures for the S&P 500 [ESU5] lost 17 points, or 0.8%, to 1955. Volume is light. Investors are debating whether last week’s plunge in stock prices, slumping oil prices and concerns about the slowing Chinese economy will deter the Federal Reserve from raising interest rates in September. The new week includes reports on durable goods and consumer confidence, among other items. Stanley Fischer, the Fed’s No. 2, is to speak Saturday at the Federal Reserve Bank of Kansas City’s annual Jackson Hole symposium on “U.S. inflation developments.” In a note to clients last week, Jeffrey Saut, chief investment strategist at Raymond James, noted that “selling squalls” rarely bottom on a Friday.

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ScreenHunter_552 Aug. 23 19.31

8/21 Wall Street poised for another torrid day of trading

Administrator - Friday, 21 August 2015 07:23

Relax, we’re about to hit the bottom in stocks: Jeffrey
U.S. stock investors take a breather, the market is nearing its bottom, Jeffrey Saut, chief investment strategist at Raymond James, said Friday.

“Our timing models call for a low between Aug. 13 and Aug. 18, with a plus-or–minus three-day margin of error, so today it feels like capitulation,” Saut said in an interview on CNBC’s ” Squawk Box.”

Saut made his remarks after U.S. equities recorded their worst trading day in about a year and a half. The Dow Jones industrial average fell nearly 360 points, while the S&P 500 turned negative for the year, as a massive fall in oil and global growth concerns weighed on investor sentiment.

“We’re nearing the bottom. We knifed through the July support yesterday. It was pretty ugly. You would look for some kind of bottom either sometime today or the middle of next week,” Saut added.

“I’ve been in this business for over 45 years and I’ve seen this act before,” he said. “It’s kind of like pornography. You know it when you see it.”

Todd Gordon, founder of Tradinganalysis.com, also said in the same interview that investors need to relax.

“What has happened really? Has any real damage been done to the uptrend in the market? I’m not so sure. I mean, we have China falling down, emerging markets are seriously on the brink of another extended leg down, but there’s a lot of talk that the [upward] trend has been broken, and I don’t think there’s any significant technical damage done,” Gordon said.

“The stock market has done nothing but flatten out, which has allowed those longer-term moving averages to kind of play catch-up,” he added.

Nevertheless, Saut of Raymond James also said it has been a while since he’s observed so much alarm in the market. “I have not seen this much fear since the spring of 2009, and we’re only 4.5 percent off of the highs,” he said. http://www.cnbc.com/2015/08/21/relax-were-about-to-hit-the-bottom-in-stocks-jeffrey-saut.html

 

Wall Street poised for another torrid day of trading
After a torrid day on Wall Street Thursday, the worst to hit the markets in 18 months, U.S. stock index futures were pointing to another lower open on Friday.

Stocks sold off Thursday with the Dow down 358 points to 16,990 and the S&P 500 off 43, or 2.1 percent to 2,035. The selling was fueled by global growth concerns and uncertainty about when the Fed will move to raise interest rates.

In Asia, Friday morning saw the Shanghai Composite slide 4.3 percent after disappointing data from China.

European markets also plunged, with the pan-European Stoxx 600 as much as 1.2 percent lower after the open amid worries over China and also Greece, where Prime Minister Alexis Tsipras resigned and called snap elections, expected to take place in September.

In oil markets, Brent crude was trading at $46.38, down 0.51 percent, while U.S. crude was $41.12 a barrel, down 0.48 percent. This week saw U.S. crude hit a new six-and-a-half-year-low.

On the earnings front, Deere and Foot Locker are expected before markets open. http://www.cnbc.com/2015/08/21/wall-street-poised-for-another-torrid-day-of-trading.html

Weekly Watch List

NASDAQ4636.10  chart-140.40  chart -2.94%

S&P 5001913.85  chart-58.33  chart -2.96%

SPY191.77  chart-5.90  chart -2.98%

GLD109.20  chart+0.38  chart +0.35%

DIS99.51  chart-2.37  chart -2.33%

GMCR55.10  chart-1.50  chart -2.65%

PPCH0.039  chart-0.001  chart -2.50%

GOOG597.79  chart-20.46  chart -3.31%

AMZN496.54  chart-16.35  chart -3.19%

AAPL107.72  chart-5.04  chart -4.47%

TSLA238.63  chart-10.43  chart -4.19%

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