The Morning Call
8/5/20
The
Market
Technical
The Averages (26828, 3306) had a good day but didn’t
resolve the friction between them. While
they are not out of sync with respect to a major trend, (1) the S&P is
above its June high, the Dow is not, (2) the Dow unsuccessfully challenged its
200 DMA [now support] intraday, the S&P is not even close and (3) while
both are making higher lows, the S&P is making higher highs; the Dow is
not. Adding to the negative tilt, both
indices made gap up opens on Monday.
Plus, the VIX, while off slightly yesterday, remains above its June low.
In short, it appears that we are in for more backing and filling. Nonetheless, I am sticking with my assumption
that the Market’s bias remains to the upside.
Gold soared 2%,
finishing above the upper boundary of its long term trading range (if it
remains there through the close on Friday, it will reset to an uptrend. The long bond recovered Monday’s losses (up
1%) and then some, putting back in an uptrend off its June low. The dollar fell 3/8%, ending back near the
lower boundary of its short term downtrend.
These indicators are back pointing in unison to a weaker economy.
King Dollar?
https://www.zerohedge.com/markets/tick-tock-staying-thrones-means-battle-come-point
Tuesday
in the charts.
https://www.zerohedge.com/markets/bonds-bullion-bid-new-records-stocks-stall-stimulus-scares
Fundamental
Headlines
The
Economy
US
Month to date
retail chain store sales grew at the same rate as in the prior week.
June factory
orders were up 6.2% versus estimates of up 5.0%; ex transportation, they were
up 4.4% versus 4.2%.
Weekly mortgage
applications fell 5.1% while purchase applications were down 1.8%.
The July ADP
private payroll report showed job increases of 167,000 versus forecasts of
1,500,000. However, the June number was revised
up by almost 2,000,000.
The June trade
balance was -$50.7 billion versus an anticipated -$50.1 billion.
International
June EU retail
sales were up 5.7% versus consensus of up 5.9%; the July services PMI came in
at 54.7 versus 55.1; the composite PMI was 54.9 versus 54.8.
The July German
services PMI was 55.6 versus expectations of 56.9; the composite PMI was 55.3
versus 55.5.
The July Chinese
Caixin services PMI was 54.1 versus projections of 56.0; the composite PMI was
54.5 versus 55.0.
The UK services
PMI was 56.5 versus predictions of 56.6; the composite PMI was 57.0 versus
57.1.
Other
The benefits of creative destruction.
Really?
He is trying to stick up Microsoft?
Business cycle indicators as of 8/3.
http://econbrowser.com/archives/2020/08/business-cycle-indicators-august-3-2020
Vehicle sales per capita.
Framing lumber prices up 81% YoY.
https://www.calculatedriskblog.com/2020/08/update-framing-lumber-prices-up-81-year.html
The coronavirus
***overnight update.
A positive thought amidst all the pessimism.
More evidence of
the gross mismanagement of this crisis. The
misinformation about hydroxychloroquine (must read).
Bottom
line. Update on valuations.
https://www.advisorperspectives.com/dshort/updates/2020/08/04/is-the-stock-market-cheap
July dividends by the numbers.
News on Stocks in Our Portfolios
Emerson Electric (NYSE:EMR) declares
$0.50/share quarterly dividend, in line with previous.
What
I am reading today
Nanny state now targeting
alcohol consumption.
https://dailycaller.com/2020/08/03/barr-nanny-state-now-targets-even-moderate-alcohol-consumption/
Mystery signals from Milky Way.
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for Survival’s website (http://investingforsurvival.com/home)
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