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Number of posts: 5,760

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DOW 28135 for Friday 12-13-19

Previous close 28132. 52 wk high 28290. 52 wk low 21712. Today's low 28028. High 29290.

Last Friday 12-6-19 close 28015.

NASDAQ : 8734 ▲

S&P : 3168 ▲

Oil WTI : 59.78 ▲

Soybeans : 9.07 ▲

Almost forgot it's Friday...Stay safe...and enjoy the weekend...Merry Christmas

Opinion: Boris Johnsons massive victory leaves Brexit uncertainty hanging over U.K. economy

Markets and investors have two ways to look at the results of the U.K. general election that gave Prime Minister Boris Johnson’s Conservatives a commanding, near-40-seat majority in Parliament.

The first would be to salute the end of the hung Parliament that proved incapable of deciding on Brexit in the last year, and the resounding defeat of the Labour Party that campaigned on a radical platform of nationalizations, massive spending and higher taxes that seemed to scare voters as much as it did investors.

But looking beyond January, what is also clear is that Johnson’s victory, as impressive as it may be, won’t change much about the U.K. prime minister’s predicament. He will now enter negotiations over the U.K.’s “future relationship” with the EU, namely the treaty that will govern trade and financial relations between the two sides. But his promise that he will never, ever ask for an extension of the 11-month transition period that will follow the U.K.’s departure early next year, and his proclaimed optimism that a treaty can be struck within that period, sound hollow.

For now, the only “extension” happening is that of the economic uncertainty created by Brexit. Investors will keep delaying their decisions pending the outcome of the U.K.-EU talks. Businesses will keep losing market shares abroad and, after a burst of euphoria, the pound could resume its slide, adding to inflationary pressures.

The only way out of uncertainty would be for Johnson to break his promises yet again, as he did when he agreed to leave Northern Ireland within the EU’s customs union for an indefinite period. He has the majority that gives him the freedom to do so. For now, it is unclear whether he wants to use it.

Trump announces phase-one China trade deal and scraps Dec. 15 tariffs

President Donald Trump announced a phase-one trade deal with China on Friday, saying Beijing had agreed to purchases of U.S. goods and will avoid tariffs that had been set to go into place on Sunday.

The Penalty Tariffs set for December 15th will not be charged because of the fact that we made the deal,” the president wrote, tweeting as Chinese officials were briefing reporters in Beijing.

Trump also agreed to slash by half — from 15% to 7.5% — the tariffs on about $110 billion of goods that he imposed in September. But he said 25% levies on $250 billion in goods, imposed in 2018, would remain.


U.S. stocks rose Friday morning after Chinese officials confirmed a U.S.-China trade deal during a news conference, though neither U.S. nor Chinese officials have offered details on the exact nature of the agreement.

The Fed Has 'Absorbed' 90% Of Treasury Issuance Since September

The Fed is pumping $145 billion per month into the system. That’s more than under QE One. Powell has said that it’s Not QE, and now says that it won’t have macroeconomic effects. Oh please. Humor me.

The obvious question here is, “Why?” And the answer is that if they hadn’t reversed course from shrinking their balance sheet, the stock and bond markets would have crashed, and short term rates would have soared.

Powell: And the purpose of all this, let’s remember, is to assure that our monetary policy decisions will be transmitted to the federal funds rate, which in turn affects other short-term rates. We have the tools to accomplish that and we will use them.

Powell: To go through with sort of like in time, we started off really on September 17th with overnight operations, by October 11th we had created and put into effect to plan, that plan is in effect.

++++ We live in interesting times.

DOW 28132

Previous close 27910. 52 wk high 28224. (New High) 52 wk low 21712. Today's low 27859. High 28224.

NASDAQ : 8717 ▲

S&P : 3168 ▲

Oil WTI : 59.28 ▲

Soybeans : 8.98 ▲

DOW 27910

Previous close 27882. 52 wk high 28174. 52 wk low 21712. Today's low 27801. High 27920.

NASDAQ : 8654 ▲

S&P : 3141 ▲

Oil WTI : 58.86 ▼

Soybeans : 8.92 ▼

DOW 27882

Previous close 27909. 52 wk high 28174. 52 wk low 21712. Today's low 27804. High 27949.

NASDAQ : 8616 ▼

S&P : 3132 ▼

Oil WTI : 59.32 ▲

Soybeans : 9.00 ▲

DOW 27909

Previous close 28015. 52 wk high 28174. 52 wk low 21712. Today's low 27906. High 28010.

NASDAQ : 8621 ▼

S&P : 3135 ▼

Oil WTI : 58.99 ▼

Soybeans : 8.97 ▲

Year-End" Repo Oversubscribed Again

Fed's Third "Year-End" Repo Oversubscribed Again Amid Liquidity Scramble As Dec 16 Tax Day Looms

One week after the Fed's second 42-day term repo which allowed dealers to lock in funding into the new year and which was again oversubscribed, confirming a growing scramble for year-end funding, traders were looking ahead to the result from today's third "year-end" repo, this time with a 28-day term maturing on January 6. And, as we noted last week, year-end liquidity fears remain front and center as the $25 billion - which the Fed expanded from $15 billion late last week - proved to again be roughly 40% below the required size to satisfy all liquidity demands.

Dealers submitted $43 BN in bids for the 28-day op ($29.80 BN in Treasurys, $0.1BN in Agency, $13.1BN in MBS paper), resulting in an oversubscription of the $25BN in available repo, and confirming that the Fed may have to add additional "year-end" repos to satisfy all dealer liquidity demand as we enter 2020.

The biggest concern: the repo rate over year end remains stubbornly stuck well above 3%, more than double the Fed Fund rate, and clear evidence that the US interbank plumbing remains broken.

DOW 28015 for Friday 12-6-19

Previous close 27667. 52 wk high 28174. 52 wk low 21712. Today's low 27839. High 28035.

Last Friday's close 11-29-19 ... 28051

NASDAQ : 8656 ▲

S&P : 3145 ▲

Soybeans : 8.89 ▲

Oil WTI : 59.02 ▲

Market doing well. Stay safe. Enjoy your weekend everybody.
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