Financial Review

Watching and Waiting

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-10-13-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe for 10-13-2015   DOW – 49 = 17,081 SPX – 13 = 2003 NAS – 42 = 4796 10 YR YLD – .04 = 2.05% OIL – .53 = 46.57 GOLD + 5.00 = 1169.90 SILV + .09 = 16.01   Anheuser-Busch InBev and SABMiller have agreed on terms for a takeover, with the world’s largest brewer set to pay $106 billion. The deal brings one out of every three beers sold worldwide under a single company. Under terms of the agreement, AB InBev would pay a $3 billion break-up fee to SABMiller should the transaction fail to clear regulatory hurdles or shareholders don’t approve of it. If the deal goes through, it would be the biggest acquisition of the year, and the largest in British history. SABMiller’s two largest shareholders, Altria Group and Bevco Ltd., can receive cash and stock for their stakes, which account for 41 percent of the company. They won’t be able to sell the shares for five years; a move that might have tax benefits.   Dell’s $67 billion buyout of EMC appears to be a win for nearly everyone involved – except EMC bondholders. Investors in EMC’s $5.5 billion of bonds are down about $338 million since news of the deal first became public last week. Why’s that? Dell’s plan to raise about $50 billion in debt for the acquisition will push existing bondholders down …

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Financial Review

Bueller? Bueller?

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-10-09-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe for 10-09-2015 DOW + 33 = 17,084 SPX + 1 = 2014 NAS + 19 = 4830 10 YR YLD – .01 = 2.10 OIL + .14 = 49.57 GOLD + 17.40 = 1157.40 SILV + .16 = 15.93   World shares were green across the board after details from the Fed’s minutes cast further doubt on the prospect of a rate rise this year. European stocks broke a one-month high for their best weekly gain since late January on renewed hopes central banks will keep monetary policy loose for longer. Overnight, Asian equities and currencies also moved higher following yesterday’s gains on Wall Street (the Dow ended above 17,000 for the first time since August, while the S&P 500 closed well past its 50-day MA of 1,995).   Oil prices traded above $50 a barrel this morning, with a gain of nearly 9% this week; for the biggest weekly gain in 6 years.   Investors are now positioning themselves for corporate earnings season, which picks up steam next week with most of the nation’s largest banks reporting their results, as well as big companies including; Intel, Netflix, UnitedHealth and GE. Earnings are expected to be down roughly 5.5 percent from a year ago, according to FactSet, mostly because of the drop in commodity prices. Now there is a game on Wall Street where analysts set the bar very low …

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Financial Review

Speech of the Day

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-09-24-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe for 09-24-2015   DOW – 75 = 16,201 SPX – 6 = 1932 NAS – 18 = 4734 10 YR YLD – .02 = 2.12% OIL + .43 = 44.91 GOLD + 23.80 = 1155.10 SILV + .36 = 15.25   Pope Francis addressed a joint meeting of Congress this morning. Francis urged the United States not to turn its back on undocumented immigrants, to reject the victimization of religious and ethnic minorities, to overcome income inequality and to save the planet from climate change, citing Scripture and the nation’s founding ideals. He also asked lawmakers to wage a constant battle against poverty and to ensure the wealth of the world is equitably shared and used to create jobs. It was really a very remarkable and beautifully crafted speech. I’m posting a link to the full text of the speech on by blog, and I would hope that you have a chance to hear or read the entire speech because it covers some of the most important issues of our time. You may be in total agreement with Francis or you might disagree with some parts, but make no mistake – this was a strong and moving address from one of the most influential people in the world.  After the speech, Francis went from some of the most powerful people to some of the least powerful as he had …

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Financial Review

First Do No Harm

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-09-17-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe for 09-17-2015 DOW – 65 = 16,674 SPX – 5 = 1990 NAS + 4 = 4893 10 YR YLD – .08 = 2.22% OIL – .25 = 46.90 GOLD + 11.80 = 1132.00 SILV + .21 = 15.24   The Fed will raise rates someday, just not today. The FOMC issued their statement today, and they left interest rates unchanged, again. The biggest change in the wording dealt with international markets, saying: “Recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term.”   The statement also included this new line: “The Committee continues to see the risks to the outlook for economic activity and the labor market as nearly balanced, but is monitoring developments abroad.” You may recall that China was also frequently referenced in the Beige Book published a couple of weeks ago in preparation for this FOMC meeting.   The Fed also released their economic projections and they seem to be forecasting more of the same: GDP just over 2% for 2015, the unemployment rate finishing the year at 5%, inflation still significantly short of their target, and the outlook for a rate hike before the end of the year. But don’t bet on it; this Fed might never get off the Schneid. There will be growing pressure for a rate hike, …

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Financial Review

Confidently Waiting

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-09-14-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe for 09-14-2015   DOW – 62 = 16,370 SPX – 8 = 1953 NAS + 26 = 4822 10 YR YLD un = 2.18% OIL – .49 = 44.14 GOLD – .30 = 1109.40 SILV – .21 = 14.51   The story that will be leading markets throughout this week will be Thursday’s Federal Reserve interest rate decision. While market expectations of an increase in rates have fallen to 28 percent, down from over 50 percent a few weeks ago, economists insist the decision is still too close to call. The Fed has been saying they will hike interest rates; this may be one of the most telegraphed rate hikes in the Fed’s history, but circumstances keep changing. Since the last Fed meeting, oil prices have dropped by 15%, the dollar has strengthened, China has slowed, emerging markets have softened, and there is little to no sign of inflation despite a Fed target of 2%. By the way, we’ll get one more report on inflation Wednesday, with the release of the CPI, or consumer price index. So, there are many reasons why the Fed might not raise rates, but then if they do stand pat, they risk coming across as timid, or worried that the recovery is in trouble. If they hike rates they can give the impression they are confident, and confidence begets confidence. And so some clever folks think …

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Financial Review

Sliding Into the Close

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-09-03-2015.mp3Podcast: Play in new window | Download (Duration: 13:14 — 12.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe for 09-03-20015   DOW + 23 = 16,374 SPX + 2 = 1951 NAS – 16 = 4733 10 YR YLD – .03 = 2.17% OIL – .12 = 46.63 GOLD – 8.70 = 1126.00 SILV + .03 = 14.83   Wall Street started the session on a high note, but could not hold it. Stocks slipped into the close and the Nasdaq turned red for the day. The stakes couldn’t be higher for the tomorrow morning’s August employment report, even though the month has typically been cursed by disappointment. The consensus guesstimate calls for about 215,000 to 220,000 new jobs created in August, with the unemployment rate holding at 5.3%, but August is notorious for misses. From 2005 to 2014, forecasters have over-estimated the initial August payrolls print seven times, including in each of the past four years. What’s more, the Labor Department (excluding annual and benchmark revisions) has marked up its first estimate in subsequent months in eight of the past 10 years. Part of the puzzle of forecasting August payrolls is the difficulty in adjusting for annual changes in the school-year calendar. Financial-market turmoil, at least, probably did little to impact hiring decisions in August. The government surveys households and businesses in the week that contains the 12th of the month, so the data will reflect responses covering the Aug. 9-15 period; that was a few days before the market …

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Financial Review

Fluctuating Between Ugly and Ugly

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-08-20-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe for 08-20-2015 DOW – 358 = 16,990 SPX – 43 = 2035 NAS – 141 = 4877 10 YR YLD – .05 = 2.08% OIL + .34 = 41.14 GOLD + 19.00 = 1154.10 SILV + .27 = 15.68   Well, it was just ugly. Yesterday, the Federal Reserve released the minutes of the July FOMC meeting. Many investors and traders interpreted the policymakers’ discussions as dovish, with the probability of a rate boost next month sliding to 36 percent from about 50 percent earlier in the day. The matter is still open to debate, and the bottom line is that we have to wait about 4 weeks to find out what the Fed will do.   Today, stocks closed near session lows, off about 2%; and it smacks of a rate tantrum, traders expressing their dis-satisfaction to let the Fed know they are opposed to rate hikes. The other reading is that a dovish Fed might mean that the global economy really is weak; the drop in commodities is hurting emerging markets; the strength of the dollar is hurting US exporters; we are now facing currency wars; and global growth (or the lack thereof) will weigh on the US economy. If the Fed doesn’t raise rates, it’s because the market is too fragile. The S&P 500 fell into negative territory for the year, with consumer discretionary the greatest decliner on the …

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Financial Review

Discretionary Reading

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-08-19-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe for 08-19-2015 DOW – 162 = 17,348 SPX – 17 = 2079 NAS – 40 = 5019 10 YR YLD – .07 = 2.13% OIL – 2.02 = 40.60 GOLD + 16.60 = 1135.10 SILV + .44 = 15.41   A new CPI report this morning shows inflation remains muted. The consumer price index, a measure of prices at the retail level, rose 0.1% in July to mark the smallest increase in three months. Yet the cost of housing, the largest expense for most Americans, continued to rise, up 0.4% last month, reflecting the biggest gain in more than eight years. And housing expenses have climbed 3.1% in the past 12 months, the largest annual increase since 2008. The prices of most other consumer goods were little changed in July. Food prices climbed 0.2% while energy prices rose a smaller 0.1%. Excluding food and energy, so-called core consumer prices also advanced 0.1% in July. Aside from shelter, prices for clothes and medical care also rose.   Even though energy prices were up slightly in July, that might not last; eventually the price at the pump for gasoline should reflect the price of oil, which has now dropped to a 6 year low of $40.60 per barrel. Based upon historical pricing for oil and gas, we should be paying about $2.00 to $2.10 a gallon at the pump. Gas prices …

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Financial Review

Solid Guesses

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-07-29-2015.mp3Podcast: Play in new window | Download (Duration: 13:16 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW + 121 = 17,751 SPX + 15 = 2108 NAS + 22 = 5111 10 YR YLD + .03 = 2.28% OIL + .91 = 48.89 GOLD + 1.20 = 1097.70 SILV + .13 = 14.91   The Federal Reserve FOMC meeting wrapped up earlier today. They issued a statement but there was no press conference. The Fed did not change monetary policy; no surprise, nobody expected a change from this meeting. The next FOMC meeting is in September and we might see changes then, or maybe December. There really weren’t many clues in the statement. There were a few subtle changes in wording of the statement; specifically on jobs, the Fed said: “The labor market continued to improve, with solid job gains and declining unemployment. On balance, a range of labor market indicators suggests that underutilization of labor resources has diminished since early this year.” “Solid job gains” is a fairly strong phrase for the Fed. No indication of slack in the labor market.   The actual decision to raise rates will come when the Fed sees “some” further improvement in the labor market. The word “some” was new. What does “some” mean? You can give it whatever meaning you want but I think it means the labor market is headed in the right direction and as long as it stays on the tracks and continues to …

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Financial Review

Step 9

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-07-28-2015.mp3Podcast: Play in new window | Download (Duration: 13:15 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW + 189 = 17,630 SPX + 25 =  2093 NAS + 49 = 5089 10 YR YLD + .02 = 2.25% OIL + .59 = 47.98 GOLD + 1.00 = 1096.50 SILV + .14 = 14.79   The Federal Reserve FOMC met today. They will meet again tomorrow and then they will issue a statement.  Investors are not expecting any major decisions this week, but they will be looking for hints on the Fed’s timing for possible future movements. While consensus for a rate rise is leaning towards September, the wild card is now China. A growing number of market watchers are suggesting that, before the year is out, two interest rate hikes rather than just one could be on the cards. In the Treasury market, futures contracts suggested that investors were making the same mistake they made at the outset of the last three major tightening cycles, by underestimating the amount the federal funds rate will be raised. The implied rate on September 2016 contracts is 0.8 percent, while many forecasts are looking at 1.5 percent to 2 percent.     Chinese shares whip-sawed between gains and losses today, as Beijing renewed its pledge to prop up an equities market. The 144 Chinese companies with primary stock listings in the US have erased nearly $40 billion in paper wealth since the Shanghai Composite peaked in mid-June; a 30% drop. After a …

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