Seeking Alpha
  • Wednesday, July 29, 2015

  • 5:59 PM
    • Saudi Arabia is planning to pull back from record high levels of production at the end of the summer when domestic energy demand subsides, WSJ reported today, a likely contributor to a moderate afternoon rise in crude oil prices.
    • The reduction could begin as soon as September and would amount to 200K-300K bbl/day, bringing production to ~10.3M bbl/day, according to the report; Saudi Arabia told OPEC it produced a record 10.56M bbl/day in June.
    • The move is “purely based on the [domestic] demand situation," according to one source, and the planned reduction likely would not affect exports.
    • Also, the world produces 91M bbl/day and current demand is 89M, so a 300K bbl/day production cut is "a drop in the bucket," says Anthony Grisanti, President of GRZ Energy.
    • ETFs: USO, OIL, UCO, UWTI, SCO, BNO, DBO, DWTI, DTO, USL, DNO, OLO, SZO, OLEM
    | 53 Comments
  • 2:11 PM
    • As expected, the FOMC left rates unchanged, but didn't commit itself one way or the other to any action in September. This could be interpreted dovishly as one might suppose today's statement would begin to lay the groundwork for a September hike were that the Fed's intention.
    • The Dow (DIA +0.5%), S&P 500 (SPY +0.5%), and Nasdaq 100 (QQQ +0.1%) all added a few points in the immediate aftermath of the 2 ET statement, but have returned to levels seen before the news.
    • Treasurys continue to take on water, with the 10-year yield up five basis points on the session to 2.30%. TLT -0.6%, TBT +1.2%
    • Fed Funds futures are pricing in about a 1-in-3 chance of a 25 basis points move in September.
    | 8 Comments
  • 10:38 AM
    • Sales orders gained a fast 22% year-over-year in the quarter ended June 30, writes Kris Hudson, lower than some analysts had hoped, but still a strong number. Sequentially though, orders for D.R. Horton, PulteGroup (NYSE:PHM), M/I Homes (NYSE:MHO), and NVR all slowed, according to Housing ResearchCenter, though normal seasonality would call for an increase. Higher interest rates are likely to blame.
    • D.R. Horton's average sales price of $289K rose 2.9% Y/Y, keeping in place a pattern of low-single digit gains over the past year. It's not necessarily that builders are lowering prices, but the mix has changed, with D.R. Horton in particular building larger numbers of less-expensive homes. The company's Express brand of entry-level homes - started in 2013 - accounted for 19% of orders in the last quarter. Still the percentage of first-time homebuyers of 41% was flat Y/Y, and down from 44% two years ago.
    • Credit remains tough to come by, with the average FICO score of D.R. Horton-originated mortgages of 716 last quarter vs. 719 a year ago and 723 two years ago.
    • ETFs: ITB, XHB
    • Previously: D.R. Horton profit nearly doubles (July 28)
    | 1 Comment
  • 10:31 AM
    | 45 Comments
  • 9:47 AM
    • United Airlines (UAL -1.2%) was attacked by the same group of Chinese hackers that illegally accessed federal personnel records and medical data, sources tell Bloomberg.
    • The company hasn't disclosed a breach.
    • It's not known if a computer systems outage at United earlier this month is related to the hacking incident.
    • Analysts note a state-sponsored attack could be part of a spy game instead of a crime motivated by financial gain, although they also warn United's M&A strategy may have been revealed.
    • Related ETF: HACK.
    | 1 Comment
  • 7:15 AM
    • The FOMC ends its two-day meeting today, and the policy statement will be released at 2 ET. A rate hike isn't expected, but perhaps markets will get an idea about whether the committee is leaning towards a move in September, or if recent global jitters and collapsing commodity prices have delayed action another three months.
    • Stock index futures are higher by 0.2% across the board.
    • Shanghai bounced 3.4% overnight and Europe is mixed.
    • The 10-year Treasury yield is up two basis points to 2.27%, gold is down $1 per ounce to $1,096, and oil is off $0.29 per barrel to $47.69.
    • ETFs: SPY, QQQ, DIA, SH, SSO, SDS, VOO, IVV, UPRO, PSQ, SPXU, TQQQ, SPXL, RSP, QID, SQQQ, QLD, DOG, DXD, RWL, UDOW, EPS, SDOW, DDM, VFINX, BXUB, QQEW, QQQE, SPLX, SFLA, BXUC, QQXT, SPUU, UDPIX, OTPIX, RYARX
    | 11 Comments
  • 4:11 AM
    | 11 Comments
  • 2:53 AM
    • Standard & Poor's has warned Brazil it could lose its coveted investment-grade rating in the coming year if fallout from a number of corruption investigations further stymies economic growth and implementation of austerity measures.
    • The agency has now put the country's foreign currency rating, which is rated one notch above junk, on negative outlook for possible downgrade.
    • The Brazilian real slid 2% to 3.43 per dollar following the announcement, its weakest level in more than 12 years.
    • ETFs: EWZ, BRF, BRZU, BZF, EWZS, BRXX, BRAQ, BZQ, BRAZ, BRAF, UBR, DBBR, FBZ
    | Comment!
  • Tuesday, July 28, 2015

  • 12:07 PM
    • Gaming revenue in Nevada fell 8.37% to $830.9M in June, according to the Nevada Gaming Control Board.
    • Las Vegas Strip revenue was off 16.1% to $445.5M.
    • An exceptionally strong month for baccarat a year ago made the comparison tough this year.
    • Gaming Control Board report
    • Related stocks: LVS, MGM, WYNN, FLL, CZR, BYD, OTCQB:TPCA.
    • Related ETF: BJK.
    | 5 Comments
  • 11:23 AM
    • Retail stocks are in-line with market averages despite a soft read on consumer confidence and more stock market losses in China.
    • The S&P Retail ETF (NYSEARCA:XRT) is up 0.26%, while Wal-Mart (NYSE:WMT) is 0.48% higher.
    • Some high-end retail stocks are putting in surprising gains including PVH Corp (PVH +1.7%), Michael Kors (KORS +1%), Ralph Lauren (RL +1%), Lululemon (LULU +2.4%), Luxottica (LUX +2.2%), Kate Spade (KATE +1.3%), Burberry (OTCPK:BURBY +2.1%).
    | Comment!
  • 10:25 AM
    • The Conference Board Consumer Confidence Index tumbled to 90.9 in July, down from 99.8% in June, and missed expectations for just a minor decline to 99.1.
    • The Conference Board's Lynn Franco notes a less optimistic outlook for the labor market combined with macro jitters out of Greece and China, but the Index remains at levels associated with an expanding economy and relatively confident consumer.
    • Those expecting business conditions to improve over the next six months fell to 14.7% from 17.9%, while those expecting conditions to worsen rose to 10.7% from 10.2%.
    • The 10-year Treasury yield remains higher by four basis points to 2.26%. TLT -0.8%, TBT +1.6%
    • Previously: Consumer Confidence decline in July at 90.9 (July 28)
    | Comment!
  • 9:52 AM
    • Investors take a least a small hiatus from selling the mortgage REITs after last night's clunker of an earnings report from American Capital Agency (AGNC +2%).
    • Book value fell by 6% during Q2, with higher rates, widening MBS spreads, and faster prepayments making for an ugly combination.
    • The company, however, entered Q3 with its lowest leverage since the financial crisis, giving it the firepower to buy assets on the cheap. At the close yesterday, the stock was selling for a 22% discount to June 30 book value. At some point, the bad news is priced in?
    • The earnings call is set for 11 ET.
    • Annaly Capital (NLY +1.6%), CYS Investments (CYS +0.8%), Western Asset (WMC +1.2%), New York Mortgage (NYMT +0.5%).
    • ETFs: MORL, REM, MORT, LMBS
    | 11 Comments
  • 9:03 AM
    | Comment!
  • 8:52 AM
    • State Street (NYSE:STT) files plans for the Financial Services Select Sector SPDR Fund (XLFS) and the Real Estate Select Sector SPDR Fund (XLRE). They would be the first additions to the Select Sector SPDRs since the family of nine launched in 1998. No expense ratios are yet available, but the current Select Sector SPDRs cost 15 basis points.
    • The move comes following last year's changes in the Global Industry Classification Standard used by S&P Dow Jones Indices and MSCI in which real estate will be broken out from the financial sector.
    • The current nine SPDRs have nearly $100B in assets, and the Financial Select Sector SPDR (NYSEARCA:XLF) is by far the largest with $21B.
    • XLF's fate? It could be converted into one of the new funds with a new name, index, and ticker, or it could continue to operate as usual.
    • Source: ETF.com
    | Comment!
  • 7:12 AM
    | 10 Comments
  • 5:00 AM
    • U.K. economic growth accelerated in the second quarter, meeting expectations, as the industrial sector posted a strong recovery, business services strengthened and North Sea output surged.
    • The 0.7% increase in GDP marks a 10th straight quarterly expansion and followed a 0.4% advance in the previous three months.
    • "After a slowdown in Q1 of 2015, overall GDP growth has returned to that typical of the previous two years," said Joe Grice, chief economist at the Office for National Statistics.
    • The pound +0.1% to $1.5570.
    • ETFs: EWU, DXPS, FKU, QGBR, DBUK, HEWU
    | Comment!
  • 4:45 AM
    • A delegation from the the so-called troika (and eurozone bailout fund) are in Athens this morning to begin negotiations over an €86B bailout.
    • The talks will start almost a week later than planned, raising pressure on Greek PM Alexis Tsipras, who is already struggling to keep his party from falling apart.
    • The two sides are also racing against time. A new bailout would have to be completed by mid-August if Athens is to secure billions of euros to repay ECB-held bonds that mature on Aug. 20.
    • ETFs: GREK
    | 3 Comments
  • 3:32 AM
    | 8 Comments
  • Monday, July 27, 2015

  • 10:04 PM
    • In early Tuesday trade, the Shanghai Composite has tacked another 2.8% on to yesterday's 8.5% tumble.
    • A check of other markets finds the Hang Seng down 0.4%, the Nikkei lower by 1.25%, and Australia's ASX 200 off 0.9%.
    • WTI crude oil is lower by another 0.9% to $46.95, and gold is little-changed.
    • One of the excuses for yesterday's crash in Shanghai was the idea Beijing would pull back from propping up share prices, but the country's Securities Regulatory Commission late yesterday promised to continue to try and stabilize the market and "prevent systemic risk."
    • ETFs: FXI, ASHR, CAF, YINN, PGJ, GXC, FXP, YANG, CHN, PEK, MCHI, TDF, XPP, YAO, GCH, ASHS, YXI, CN, CHXF, FCA, CNXT, CHNA, KBA, JFC, AFTY, CHAU
    | 11 Comments
  • 3:51 PM
    • Stocks in Toronto are off 1.45% just ahead of the bell, their 7th-consecutive day of losses. Energy and raw materials producers are among the leading decliners as the Bloomberg Commodity Index falls yet again, hitting a 13-year low.
    • Also getting socked are the banks, led by Scotiabank's (NYSE:BNS2.4% drop and TD Bank's (NYSE:TD1.9% fall.
    • The loonie (NYSEARCA:FXC) is flat, and its lowest level since the height of the global financial panic in early 2009.
    • ETFs: EWC, CNDA, EWCS, QCAN, FCAN, HEWC
    | 15 Comments
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