Showing posts with label manufacturing. Show all posts
Showing posts with label manufacturing. Show all posts

Thursday, February 13, 2020

China Announces Massive Increase In Number of New Cases of COVID-19 (coronavirus, Wuhan Flu, WuFlu)

Money Daily claims no special powers, but, just by coincidence, after yesterday's post cried out to the Chinese for transparency, some actually was delivered.

Coming too late to affect the meteoric rise in US stocks on Wednesday, China's official propaganda wing may be coming to its senses, albeit quite late in the game.

Late Wednesday, instead of the usual 2500-3000 new reported cases and 90-100 fresh deaths from the newly-named COVID-19, China's Ministry of Truth instead announced 14,840 new cases and 242 deaths.

The new totals are being reported with some differences, but John Hopkins' usually-reliable counts have mainland China at 59,822, with worldwide reported cases at 60,349. There are 527 confirmed cases outside of China and a total of 1,370 deaths, all but two occurring in China.

These are alarming numbers, only now shedding some light on just how widespread the viral infection has gone on mainland China, and just how deeply Chinese officials have been trying to cover up the carnage. It's one thing to fudge economic numbers, which China does regularly and gratuitously, but quite another when human lives are at stake.

Revelation of the virus spreading faster, affecting more people by orders of magnitude and killing more than double the numbers previously reported raised eyebrows around the world, sending markets into reverse, though not to any alarming degree. Asian and European markets staged orderly retreats of less than one percent.

Hoping to avoid complete panic, international indices are being buoyed by central banks, no doubt furiously buying behind the scenes as the severity of the condition in China becomes more apparent. Supply chains already have broken down and this is only the beginning. With China looking to be out of commission for the better part of this and next month - possibly longer - the disruption to global trade and manufacturing cannot and should not be understated.

Being the global hub for manufacturing, China, by being late in its attempts to contain the spread of COVID-19 and then attempting to downplay the severity of the crisis it faces has put its own economy and that of the globalized world in jeopardy.

This story continues to evolve and the implications just became much more serious than the Chinese government, the WHO and health officials in other countries are admitting.

Money Daily will attempt to stay atop current developments on a daily, if not more frequent, basis.

At the Close, Wednesday, February 12, 2020:
Dow Jones Industrial Average: 29,551.42, +275.12 (+0.94%)
NASDAQ: 9,725.96, +87.02 (+0.90%)
S&P 500: 3,379.45, +21.70 (+0.65%)
NYSE: 14,136.98, +82.88 (+0.59%)

Friday, January 10, 2020

January Effect In Force; US Adds 160,000 Jobs In December

Stocks rallied once again, with the Dow jones Industrials popping for a gain of over 200 points. The Dow closed higher for the fourth time in six 2020 sessions for a total rise of 418 points, or about 1.4%.

The Dow, S&P 500, and NASDAQ set new all-time highs on a closing basis, while the NYSE Composite index finished just shy of a record, ending the session at 13,997.65. The prior high of 14,001.13 was achieved on January 2. Any kind of positive return Friday should push the Composite into record territory.

Investors should get their "Dow 30,000" hats ready, because the world's most-watched stock index is about to surge beyond that number, quite possibly today right at the open after the Bureau of Labor Statistics (BLS) reported an additional 145,000 jobs created in December according to the just-released non-fram payroll report for December, 2019.

Even though there's some seasonality to the figures due to holiday hires and a fall-off after November's gains were boosted by striking GM workers returning to their jobs, the number is another sign of strength in the underlying US economy, now, more than ever, the main driver of global growth. As Europe struggles with deflationary trends, negative interest rates, and high unemployment (especially among youths), and China increasingly seems to be bowing to pressure on tariffs and trade from the US, America's clout has become paramount.

Among developed nations, the United States continues to set the agenda, as President Trump's "America First" strategy has emboldened employers and workers alike to share in the positivism of the current environment. While wage growth is still sluggish, job creation in the private sector continues strong. Wednesday's ADP private payroll report found 202,000 new jobs created in December.

While the 145,000 jobs in the non-farm payroll report did come in below estimates of 160,000, the miss was not significant. October was revised 4,000 lower, to 152,000, and payrolls in November were revised down 10,000 to 256,000.

Unemployment remained steady at 3.5%, as expected. By sector, retail and leisure/hospitality led the gains, with bricks and mortar stores adding 41,000 jobs while restaurants, hotels and such added 40,000. Health care was another gainer, picking up 28,000 jobs in December. Construction trades added 20,000 new positions, but manufacturing and transportation declined, by 12,000 and 10,000, respectively. For all of 2019, manufacturing added 46,000, while transportation gained 57,000.

Those two sectors are offering indications that the expansion may have run its course, or at least is slowing significantly. In 2018, manufacturing added 264,000 jobs, transportation gained 216,000. While those figures may cause some anxiety, they also can be interpreted as a sign that these segments of the economy are still integrating the additional employees and that this period is merely a lull, following a robust hiring round.

Overall, despite the small miss and reductions from prior months, the report still comes in as positive for the US economy. Perhaps not the robust growth expected by the most bullish, but stable hiring is a sign that, in such a mature economy, nothing troubling lies directly ahead.

The jobs report was good enough to keep the rally humming along. The major indices should continue their path through record highs for time being.

At the Close, Thursday, January 9, 2020:
Dow Jones Industrial Average: 28,956.90, +211.81 (+0.74%)
NASDAQ: 9,203.43, +74.18 (+0.81%)
S&P 500: 3,274.70, +21.65 (+0.67%)
NYSE Composite: 13,997.65, +63.21 (+0.45%)

Monday, May 14, 2018

Dow Gains For 8th Straight Day; Tuesday Data Reads Important

Stocks started the week on a strong note, only to see the rally fade as the session wore on, leaving the indices with marginal gains, led by the Dow Industrials with a 0.27% rise, the eighth straight trading day in which the Dow has recorded a positive close.

Higher by 163 points in the 11:00 am hour, Dow stocks gave back nearly 100 points, or roughly two-fifths of their value by the end of the day.

With most major companies having already reported first quarter earnings, this may turn into a rather dull week, though Tuesday's trifecta of economic data releases - NY Fed Manufacturing, Retail Sales, and Durable Goods - may provide suitable trading fodder.

On Wednesday, Macy's (M) reports prior to the market open, while Cisco Systems (CSCO) reports after the close.

Thursday may be the most impactful session, as retailers Wal-Mart (WMT), Nordstrom (JWN), and JC Penney (JCP) each report before the opening bell.

Thus far, nearly at the halfway point of the month, "sell in May" has not been the preferred trading regimen. Rather, a family strong counter-rally has been tearing along, leaving the Dow at its best level in nearly two months.

Dow Jones Industrial Average May Scorecard:

Date Close Gain/Loss Cum. G/L
5/1/18 24,099.05 -64.10 -64.10
5/2/18 23,924.98 -174.07 -238.17
5/3/18 23,930.15 +5.17 -233.00
5/4/18 24,262.51 +332.36 +99.36
5/7/18 24,357.32 +94.81 +194.17
5/8/18 24,360.21 +2.89 +197.06
5/9/18 24,542.54 +182.33 +379.39
5/10/18 24,739.53 +196.99 +576.38
5/11/18 24,831.17 +91.64 +668.02
5/14/18 24,899.41 +68.24 +736.26

At the Close, Monday, May 14, 2018:
Dow Jones Industrial Average: 24,899.41, +68.24 (+0.27%)
NASDAQ: 7,411.32, +8.43 (+0.11%)
S&P 500: 2,730.13, +2.41 (+0.09%)
NYSE Composite: 12,772.04, +10.22 (+0.08%)

Tuesday, March 24, 2015

What China is Making, the World Isn't Taking

With not much in the way of company news or economic data to spur stocks in any particular direction, stocks - if you believe there is still a viable market out there - may have taken their queues today from China, where manufacturing slipped to its lowest level in nearly a year.

HSBC's purchasing manager's initial survey for March fell to 49.2, signaling contraction, from January's reading of 50.7, the worst reading in 11 months. The survey is designed so that numbers above 50 indicate expansion, under 50, contraction.

This should not have been a surprise to anyone on Wall Street, because they know how China's dumplings are boiled. They're reliant on exports of manufactured goods, primarily to the United States and Europe.

Therefore, if those two consumer groups are not buying, China isn't selling. And that's exactly what has been going on for months now, if not years. Economic numbers in all areas of the world are slightly skewed by regional and political preference, but when China, widely regarded as the world's engine of growth in the 21st century, actually shows manufacturing in decline, it's likely much worse than reported.

There isn't much about boosting manufacturing that the central banks of the world haven't already tried and found to not work, so it's likely, at this point, up to individuals to get out and spend.

Not. Gonna. Happen.

Europe is bankrupt. The USA has gone, in sixty short years, from being a creditor nation, to debtor nation, to where we are today, on the cusp of becoming a deadbeat nation.

In popular parlance, a deadbeat is somebody who borrows and doesn't pay back its debts. Well, the good, old USA can do attitude hasn't been getting it done for a long, long time. Which is why we have a federal debt of over $16 Trillion. The government doesn't pay off its debts; it rolls them over into new debt, something that, if you or I or your neighbor tried to do, we'd be laughed all the way to the nearest courthouse.

The US government has seemingly been intent upon destroying the country, the currency, and the popular notion of being the "land of the free." The failure of politicians to even attempt to fix the various parts of our fiscal condition that are broken is at the bottom of not only the Fed's Zero Interest Rate Policy (ZIRP) but also is tearing away at the fabric of the nation, and people are beginning, at last, to notice, and worse, they're doing something about it.

They're not buying. They're not buying Chinese products. They're not buying politicians' promises. They're not buying Wall Street's scams. They're not buying government statistics because people in America don't consider themselves statistics. They consider themselves people.

People matter. Governments come and go. It may be getting close to the time that some of the bigger ones get up and leave.

But, they'll probably need a little push... over the cliff.

Dow 18,011.14, -104.90 (-0.58%)
S&P 500 2,091.50, -12.92 (-0.61%)
NASDAQ 4,994.73, -16.25 (-0.32%)