Thursday, September 3, 2015
- The selling of foreign central banks (particularly China) is the latest worry for long-dated U.S. Treasurys, but at least for the moment, the buying of foreign private investors is more than making up for central bank sales.
- According to Detusche Bank, there's been more than $200B of net foreign private buying over the last 12 months vs. about $100B of central bank sales.
- Net foreign buying of all U.S. securities has topped $400B over the past year - not near the level it hit in the financial crisis, but stronger than it's been in years.
- Previously: Deutsche: Central banks to unload $1.5T in FX reserves (Sept. 1)
- ETFs: TBT, TLT, TMV, TBF, EDV, TMF, TTT, ZROZ, TLH, SBND, VGLT, UBT, DLBS, TLO, TENZ, LBND, DLBL, TYBS, VUSTX
- Jaguar (NYSE:TTM) is lowering the base price of several models, according to the company's top exec in North America.
- Brand CEO Joe Eberhardt says Jaguar is on the eve of a major transformation under which it hopes to boost volume by introducing new models.
- Jaguar sales in the U.S. are down 4.4% Y/Y through the first eight months of the year.
- Speaking at his post-meeting press conference, ECB President Mario Draghi said no "immediate" boost to QE was discussed at today's policy gathering, but he reiterated the bank's willingness to act if necessary.
- The ECB did boost the percentage of any single issue of bonds it can buy to 33% from 25%.
- Up ahead of Draghi, European stocks added to gains, with the Stoxx 50 closing higher by 2.2%. Flat ahead of Draghi, the euro sunk 1.1% to $1.1104.
- Germany (NYSEARCA:EWG) +2.7%, France (NYSEARCA:EWQ) +2.2%, Italy (NYSEARCA:EWI) +2.5%, Spain (NYSEARCA:EWP) +1%, U.K. (NYSEARCA:EWU) +1.9%.
- Enjoying the strong dollar today is the leader in currency-hedged ETFs, WisdomTree (WETF +3.1%).
- The timetable by Tesla Motors (NASDAQ:TSLA) to introduce its mass-market Model 3 in two years appears to give the Chevrolet Bolt EV a head start with EV buyers in the $30K-$35K range.
- Though development on the Bolt has been quieter than the news coming out of Fremont, Reno, and Elon Musk's twitter account - GM is reported to have hand-built protypes up and running and sales to consumers planned for 2017. Early review for the Bolt could be important with Tesla having a solid track record of dazzling reviewers with performance on the EV high-end.
- Nissan (OTCPK:NSANY) is also player in the mass-market EV market with a new long-range Leaf in the works.
- Ford (NYSE:F) has denied reports it's working on a long-range EV. If the Los Angeles Auto Show comes and goes in late November with no official announcement from Ford, then it may indicate the Detroit automaker will sit out the initial battle.
- Toyota (NYSE:TM) isn't a pure EV player, but is busy with its hydrogen-powered Mirai introduction and has the well-established Prius program cycling along.
- EV sales watch: InsideEVs.com 2015 sales scorecard
- The ECB has boosted the percentage of any single issue of bonds it can buy to 33% from 25%, says Mario Draghi in the early moments of his post-policy meeting press conference. In another dovish note, Draghi says the latest data point to a slower rise in inflation than previously thought.
- The first comment has sent the Stoxx 50 (NYSEARCA:FEZ) to its session-high, up 2.1%, and the euro (NYSEARCA:FXE) tumbling 82 pips to $1.1135.
- ETFs: FXE, VGK, EUO, FEZ, HEDJ, ERO, IEV, EPV, EZU, DRR, FEU, EEA, EUFX, EURL, ULE, FEP, UPV, DBEU, URR, ADRU, HEZU, FEEU, IEUR, FIEU, DBEZ, FEUZ, SBEU, HGEU, HFEZ
- Previously: ECB on hold; Draghi press conference starts in 45 minutes (Sept. 3)
- Japan +0.48%.
- Hong Kong -1.18%.
- China -0.20%.
- India +1.31%.
- London +1.48%.
- Paris +1.27%.
- Frankfurt +1.19%.
- Chinese markets are closed today and tomorrow due to a giant military parade marking the 70th anniversary of the end of World War II.
- Presiding over the extravaganza, President Xi Jinping said China would remain committed to "the path of peaceful development" and unexpectedly pledged to slash 300K troops from its 2.3M strong military.
- The cuts, the largest reduction since 1997, will be mostly complete by the end of 2017.
- Eurozone business activity accelerated at its fastest pace in more than four years last month, as output growth increased in both the manufacturing and services sectors.
- Markit's final August Composite PMI beat an earlier estimate of 54.1, settling at 54.3 - its highest level since May 2011.
- While the upbeat surveys provide some welcome news for the European Central Bank, they still only point to modest third-quarter GDP growth.
- Euro +0.1% to $1.1240.
- Paris +1.6%. Frankfurt +1.8%. Euro Stoxx 50 +1.5%
- Traders will be listening to announcements from the European Central Bank today, as President Mario Draghi and the governing council gather in Frankfurt to set monetary policy and discuss the state of Europe's economy.
- Economists expect the inflation forecast to be lowered and for ECB staff to cut their growth outlook amid concerns in the emerging markets and upward pressure on the euro.
- Draghi is also likely to repeat earlier statements that the central bank is ready to deploy further stimulus measures if needed.
- U.S. Futures: Dow +0.4%. S&P +0.3%. Nasdaq +0.4%.
- Europe: London +1.6%. Paris +1.4%. Frankfurt +1.7%.
- Asia: Nikkei +0.5%; Shanghai closed; Hang Seng closed; Sensex +1.3%.
- The latest polls out of Greece are showing the country's upcoming election is too close to call.
- Former Prime Minister Alexis Tsipras' Syriza party is neck and neck with Greece's main opposition New Democracy, which are both forecast to get about a quarter of the total vote.
- The figures lower the likelihood of outright majority in the next parliament, meaning Europe's most indebted state could face thorny coalition talks after the ballot.
- ETFs: GREK
- Brazil's two-decade rule over the the Latin American stock markets is continuing to dwindle as the nation's recession and political crisis deepen and its currency plunges.
- At one point a few years ago, Brazil's market was four times larger than nearest rival Mexico, but that gap, once as much as $1.1T, is now down to just $133B.
- Regression analyses of the current pace of declines indicate Brazil's lead could disappear over the next 13 months.
- ETFs: EWZ, EWW, MXF, BRF, BRZU, EWZS, BRXX, BRAQ, BZQ, MXE, BRAZ, BRAF, UBR, DBBR, UMX, DBMX, FBZ, SMK, QMEX, HEWW
- Activity in Japan's services sector expanded at the fastest pace in almost two years in August, despite persistent signs of frailty in Asia's second largest economy.
- The Markit/Nikkei Japan Services PMI rose to a seasonally adjusted 53.7 from 51.2 in July to reach its highest point since October 2013.
- The positive services sector reading follows several disappointing figures of Japanese industrial production and household spending.
- Nikkei +0.9% to 18,252.
- ETFs: DXJ, EWJ, DFJ, DBJP, NKY, JOF, EZJ, JEQ, JPNL, DXJS, EWV, SCJ, HEWJ, JSC, ITF, JPP, QJPN, FJP, DXJT, JPMV, DXJR, DXJC, DXJH, JHDG, DXJF, JPN, JDG, HGJP
Wednesday, September 2, 2015
- Toyota (NYSE:TM) starts its slow roll-out of a hydrogen car program in the U.S. next month when the Mirai is introduced.
- The automaker expects to sell 3K Mirai vehicles over the next three years as it begins to build out a refueling infrastructure in key regions.
- Though there are a small number of Hyundai Tucson and Honda FCX Clarity fuel cell vehicles already on the road in the U.S., the Mirai is expected to draw some attention on the performance end.
- All five of the bank's market-timing signals are flashing a buy signal for the first time since near the epic lows of early 2009, says Morgan Stanley, issuing a "full house" buy alert.
- The five timing tools are valuation, fundamentals, risk, capitulation, and a combined market indicator.
- To take one: The trailing dividend yield on stocks as measured by the MSCI Europe Index is 240 basis points above the yield on a mix of European government bonds - pretty close to a one-century high.
- The best way to play the rebound is through eurozone bank stocks (NASDAQ:EUFN), says Morgan.
- ETFs: VGK, FEZ, HEDJ, IEV, EPV, EZU, FEU, EEA, EURL, FEP, UPV, DBEU, ADRU, HEZU, FEEU, IEUR, FIEU, DBEZ, FEUZ, SBEU, HFEZ, HGEU
- Sands China (OTCPK:SCHYY, OTCPK:SCHYF) maintained its market share lead in Macau in August.
- The casino operator took 25.2% of gross gaming revenue during the month to top SJM Holdings (OTCPK:SJMHF, OTCPK:SJMHY) at 21.8% and Melco Crown (NASDAQ:MPEL) at 13.5%.
- Overall, the gaming sector in Macau remains in a deep revenue slide.
- Previously: Macau gaming revenue down 36% in August (Sep. 01 2015)
- Hyundai (OTC:HYMLF) announces the departure of its top sales exec in North America. A search for a replacement has begun.
- Bob Pradzinski, who has been the head of U.S. sales since early in 2014, joins several other high-level executives from the U.S. to leave the company this year.
- Hyundai's YTD sales in the U.S. are up 2.5% to trail the industry average.
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