The Morning Call
5/6/20
The
Market
Technical
The Averages (23883, 2868) made a strong showing most of
the day but faded a bit into the close, ending below their 4/17 high and leaving
them in that 4/17-4/20 trading range. This
reinforces my comment yesterday: ‘That the indices couldn’t hold above their 4/17
highs but also couldn’t develop follow through on last Thursday/Friday’s selloff
suggests that they have found a standoff level between the bulls and
bears. I wait the outcome.’
The dollar had another
good day on big volume. TLT and GLD charts continue strong. All this points to the need for safety.
Tuesday in the charts.
Fundamental
Headlines
Yesterday’s US data
was mixed. The March trade balance, the
April services PMI and month to date retail chain store sales were disappointing
while the April composite PMI and the April ISM nonmanufacturing index were
better than anticipated.
Overseas,
the March EU PPI was lower than expected while the April UK services and
composite PMI’s were above estimates.
The
coronavirus
***overnight, a
new strain of coronavirus discovered (must read).
The re-opening of
Florida.
The advantage of
diverse systems in dealing with a crisis.
Here is the
negative case for re-opening. Note there
is almost no data and almost no mention of the economic/health consequences of
not re-opening.
What’s good for
thee but not for me.
The
Fed
There was one
minor headline during the day. Fed vice
chair Clarida made comments that about the economy that were more negative than
the current generally accepted forecast.
Another irresponsible
Fed policy.
When the Fed
finally loses control.
Bottom line: the
liquidity driven Market has returned equities to rich valuation levels. I will use this opportunity to Sell Half of any
holding that trades into its Sell Half Range.
April dividends by
the numbers.
Too connected to
fail (must read).
Warren Buffett’s
peek into the financial abyss.
Subscriber Alert
EQM Midstream Pts.
(EQM) reduced its dividend. Hence the
High Yield Portfolio will Sell its position at the Market open.
News on Stocks in Our Portfolios
FactSet Research Systems (NYSE:FDS) declares $0.77/share quarterly dividend, 6.9% increase from
prior dividend of $0.72.
Economics
This Week’s Data
US
The
April services PMI came in at 26.7 versus estimates of 27.0; the composite PMI
was 27.0 versus 24.4.
The
April ISM nonmanufacturing index was reported at 41.8 versus projections of
36.8.
Weekly mortgage
applications were up 0.1% while purchase applications were up 5.8%.
The
April ADP private payroll report showed job losses of 20,236,000 versus
expectations of 20,000,000.
International
March German factory
orders declined 15.6% versus estimates of -10.0%; the April services PMI came
in at 16.2 versus 15.9; the composite PMI was 17.2 versus 17.1.
March EU retail
sales were off 11.2% versus consensus of -10.5%; its April services PMI was 12
versus 11.7; the composite PMI was 13.6 versus 13.5.
The April UK
construction PMI was 8.2 versus forecasts of 22.2.
Other
The
case for negative interest rates.
The
German high court just upended the ECB’s QE.
What
I am reading today
Wednesday
morning humor.
Eat
steak and be happy. Eat brussels sprouts
and be depressed.
The
problem with personalizing the outcome of decisions.
Quote of the day.
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for Survival’s website (http://investingforsurvival.com/home)
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