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Futures Slide Ahead Of Jobless Claims As Gold Surge Continues

Futures Slide Ahead Of Jobless Claims As Gold Surge Continues

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Futures Slide Ahead Of Jobless Claims As Gold Surge Continues Tyler Durden Thu, 08/06/2020 - 08:17

US stock index futures dropped on Thursday alongside European stocks as investors looked forward to the latest weekly jobless claims report to gauge the pace of a rebound in the labor market, while also anticipating a new fiscal stimulus bill.

The top decliner among components of the Nasdaq 100 index was Western Digital shares, which sank 8.9% pre-market after the hard drive maker reported weaker-than-expected fourth-quarter revenue and forecast a soft current quarter outlook.

In Europe, mining giant Glencore Plc led losses among peers after scrapping its dividend. U.K. broadcaster ITV Plc slumped after saying it wouldn’t provide an outlook for the rest of the year after the pandemic led to its worst-ever drop in advertising sales. Turkey’s lira tumbled to its lowest level against the dollar as interventions by state banks failed to reassure markets.

Earlier in the session, Asian stocks were little changed, with materials and energy rising, after rising in the last session. Most markets in the region were up, with South Korea's Kospi Index gaining 1.3% and India's S&P BSE Sensex Index rising 1.1%, while Hong Kong's Hang Seng Index dropped 0.7%. The Topix declined 0.3%, with Japan Sys Tech and Grace falling the most. The Shanghai Composite Index rose 0.3%, with Sichuan Hongda and Bohai Automative Systems posting the biggest advances. Chinese shares dropped after Secretary of State Pompeo warned of ‘significant threat’ from ‘untrusted Chinese apps’.

“There are some risks of the market relying too heavily on positive news around the fiscal stimulus and an earnings season that still wasn’t that great, even if many companies did beat,” Kerry Craig, global market strategist at JPMorgan Asset Management in Melbourne, said on Bloomberg TV. “There’s a case for markets, in the U.S. particularly, taking a pause from here on out rather than continuing this rally, given how strong it has been.”

Gold pushed further above $2,000 an ounce for a third day before news on whether the U.S. will approve another trillion-dollar aid package (or much bigger) to counter the coronavirus. Silver prices were up 25% in July, the second-biggest monthly gain for the white metal on record, anbd are extending gains this week, with spot silver spiking above $28 this morning...

And gold rising too...

In FX, the dollar index halted its slide after falling for two sessions after California reported its second-deadliest day from the virus and Florida’s tally topped 500,000. Traders are monitoring negotiations for the next virus aid package while Cleveland Federal Reserve President Loretta Mester said more fiscal support is needed after a sharp drop in U.S. employment gains in July.  The pound strengthens as much as 0.5% against the U.S. dollar as the BOE points to the pitfalls of negative rates, and leaves them on hold at a record low of 0.1%. Turkey’s lira tumbled to its lowest level against the dollar as interventions by state banks failed to reassure markets. The Norwegian krone trimmed some of its gains after it reached its highest levels since January on Wednesday as a rally in oil prices falters. Australia’s dollar also trims its gains after rising on an uptick in iron ore prices.

China’s yuan weakened for the first time in three sessions, following a rapid advance a day earlier that some traders saw as excessive. The currency dropped 0.16% to 6.9458 per dollar as of 5:14 p.m. in Shanghai. The slide came after the yuan rallied 0.6% on Wednesday, driven by optimism on China-U.S. relations as senior officials from the two countries planned to discuss the trade deal this month. That hopefulness then faded as the U.S. stepped up its attack on Chinese technology firms. The earlier advance took the yuan’s 14-day relative strength index versus the dollar beyond a level which to some traders signaled the gains were overdone

In rates, treasuries bull-steepen as long-end yields shed up to 4bp, extending slide in early U.S. session as S&P 500 futures fall, led by European stocks on earnings. Yields were lower by 1bp to 4bp across a flatter curve with 2s10s, 5s30s spreads tighter by 2.5bp and 1.4bp; 30-year touched 1.179%, lowest since April. Dip-buying during Asia session and a flurry of futures activity including block trades sparked the move, which continued through European morning.

Looking at today's initial claims report, consensus expects a 1.415 million Americans filed for state unemployment benefits in the latest week, down slightly after two consecutive weeks of huge increases triggered fears of a stalled recovery in the labor market.

Market Snapshot

  • S&P 500 futures up 0.1% to 3,320.00
  • STOXX Europe 600 down 0.2% to 364.28
  • MXAP up 0.1% to 169.72
  • MXAPJ up 0.4% to 567.44
  • Nikkei down 0.4% to 22,418.15
  • Topix down 0.3% to 1,549.88
  • Hang Seng Index down 0.7% to 24,930.58
  • Shanghai Composite up 0.3% to 3,386.46
  • Sensex up 1.2% to 38,101.69
  • Australia S&P/ASX 200 up 0.7% to 6,042.19
  • Kospi up 1.3% to 2,342.61
  • German 10Y yield fell 0.9 bps to -0.515%
  • Euro down 0.06% to $1.1856
  • Brent Futures down 0.3% to $45.03/bbl
  • Italian 10Y yield rose 2.5 bps to 0.847%
  • Spanish 10Y yield fell 1.3 bps to 0.296%
  • Brent futures down 0.2% to $45.06/bbl
  • Gold spot up 0.7% to $2,051.33
  • U.S. Dollar Index down 0.01% to 92.86

Top Overnight News from Bloomberg

  • Twitter Inc. and Facebook Inc. blocked a video shared by accounts linked to U.S. President Donald Trump for violating their policies on coronavirus misinformation in clip of an interview in which he said children were “virtually immune” from Covid-19
  • German manufacturing continued its recovery in June, with orders rising much stronger than forecast after restrictions to contain the coronavirus were loosened
  • Investors should consider the risk of a successful coronavirusvaccine unsettling markets by sparking a sell-off in bonds and rotation out of technology into cyclical stocks, warned Goldman Sachs Group Inc
  • Glencore Plc won’t pay its deferred dividend after net debt spiked because the commodities giant poured money into its trading business to cash in on volatile price swings

Asian equity markets traded mixed amid a lack of fresh catalysts and with the region failing to take advantage of the mild tailwinds from Wall St where cyclicals led the upside and the DJIA outperformed its major peers after the blue-chip index received a boost from a surge in Disney shares post-earnings and with Boeing also flying high after optimism on its ability to navigate through the aviation crisis. Furthermore, participants continue to hang on COVID-19 relief discussions where the latest headlines suggested that progress must be made by this Friday or else President Trump is ready to take executive action. ASX 200 (+0.7%) was positive with the index kept afloat of the 6000 level, supported by the commodity-related sectors and with the RBA continuing its QE operations for a 2nd consecutive day. Nikkei 225 (-0.4%) was subdued by a firmer currency and as earnings remained in focus with Honda Motor and Mitsui Engineering & Shipbuilding among the worst hit after posting losses during the prior quarter, while KOSPI (+1.3%) benefitted alongside strength in index heavyweight Samsung Electronics after it unveiled a new phablet, foldable smartphone and wearable products. Hang Seng (-0.7%) and Shanghai Comp. (+0.3%) failed to hold on to early gains with sentiment dampened by a continued PBoC liquidity drain and ongoing US-China tensions with the US said to want untrusted Chinese apps removed from US app stores and President Trump criticized that Hong Kong will not be a successful financial exchange anymore in which the city will dry up and fail. Finally, 10yr JGBs were weaker amid spill-over selling from USTs and with prices also dampened by weaker demand at the 10yr inflation-indexed auction.

Top Asian News

  • India’s Central Bank Holds Rates, Focuses on Financial Stability
  • Thailand Picks Ex-Banker as Finance Chief to Fight Crisis
  • Philippines Raises Budget Deficit Ceiling Until 2022
  • Japan Stocks Fall as Traders Shift Holdings Before Summer Break

A choppy day in European stock markets [Euro Stoxx 50 -0.4%] as losses seen at the open where met with a bout of buying – which took most of Europe into positive territory – but price action thereafter reversed. UK’s FTSE 100 (-1.3%) remains the underperformer in the region in the aftermath of the BoE monetary policy decision, which prompted a firmer GBP thus providing unfavourable currency conditions. On the other side of the spectrum, DAX (Unch) has remained somewhat resilient amid post-earning gains from a number of heavyweights including Siemens (+2.7%) and Adidas (+4.0%) who hold 8.3% and 4.4% weightings respectively. Sectors are mostly lower with the exception of industrials – which benefits from the broader losses across materials – but broader sectors do not show a particular risk bias. The breakdown paints a similar picture and sees Industrial Goods & Services leading the gains, with Travel & Leisure now flat after Lufthansa (Unch) trimmed gains, albeit the Co. reported less dire-than-expected numbers. Individual movers again are largely oriented around earnings: Adecco (+1.1%), Credit Agricole (-0.5%), ING (-0.2%), Glencore (-5.9%) – with the latter narrowing its FY20 copper production guidance after reporting deteriorations in both revenue and adj. EBIT.              

Top European News

  • Merck KGaA Lifts Profit Outlook as Pandemic Seen Abating
  • Pound Gains, Bonds Fall as Prospect of BOE Negative Rates Fades
  • Lufthansa Rises as Airline Widens Job Cuts, Analysts Cite Beats
  • Hammerson to Raise $1.1 Billion as Covid Hurts Malls

In FX, EUR/GBP - The cross has drifted back down towards 0.9000 following a much more pronounced Euro retreat from post-German data peaks relative to Sterling after a less pessimistic BoE near term outlook via the latest MPC minutes and MPR. Indeed, Eur/Usd has reversed sharply from 1.1915 to circa 1.1840, while Cable is holding firm on the 1.3100 handle between 1.3113-82 even though the Dollar has clawed back losses against most major counterparts and vs GOLD that has been instrumental in terms of the Greenback’s downfall. Back to the Pound, post-policy meeting comments from Governor Bailey underlined the message that NIRP remains under review and in the toolbox, but not currently on the agenda.

  • DXY/NZD/CAD/AUD - Consolidation, short covering and a technical rebound may all be contributing to the broad Buck bounce after the index breached the prior ytd low, but held close to 92.500 at 92.495 in the run up to Friday’s jobs data. However, 93.000 is capping the recovery for now as US Treasury yields and the curve stabilises amidst dip and block buying after Wednesday’s post-Quarterly Refunding bear-steepening and a bumper NFP print could yet prompt renewed Dollar selling given the likely boost to overall risk sentiment. Nevertheless, the Loonie has pared gains from 1.3250+ towards 1.3300, Kiwi is back below 0.6650 and Aussie sub-0.7200 against the backdrop of retracements in crude and commodities.
  • CHF/JPY - Both displaying degrees of resilience in the context of the aforementioned Greenback revival, as the Franc maintains 0.9100+ status and Yen stays comfortable afloat of 106.00 within a raft of hefty option expiries spanning 105.00 to 106.25 – for full details check out the headline feed at 7.30BST. Ahead, Japanese household spending data may provide some independent impetus for the Jpy before the monthly US labour report.
  • SCANDI/EM - The Norwegian and Swedish Crowns have been undermined by waning risk appetite on top of the downturn in oil prices, with Eur/Nok and Eur/Sek hovering around 10.6400 and 10.3100 respectively even though the single currency remains well off early highs, but the Turkish Lira is plunging further below 7.0000 vs the Dollar and looks destined to revisit record lows (7.2690), at least, as the rout continues and some market participants speculate whether the CBRT is compliant if not complicit with Try depreciation as a means of addressing the country’s deteriorating finances having depleted reserves and approaching the limits of monetary easing. Conversely, a Rupee rebound after the RBI confounded consensus for a 25 bp rate cut and remained on hold, while the Czech Koruna is anticipating the CNB to stand pat later.                

In commodities, WTI and Brent futures remain in the doldrums in early European trade as a firmer Dollar and subdued risk sentiment weighs on prices amid a lack of fresh fundamental catalysts for the complex, whilst analysts at JPM have trimmed their H2 2020 pol demand forecast by 1.5mln BPD – potentially on account of second wave woes. On the docket, traders will be eyeing the possible release of Saudi Aramco’s OSPs for September – which could come later this week or early next week according to sources. Expectations point towards an OSP cut to their flagship grade to Asia amid the easing of supply cuts from OPEC+. Elsewhere, spot gold ekes mild gains relative to recent performance and trades on either side of USD 2050/oz, whilst spot silver remains the outperformer, some analysts cite the sharp recovery in global industrial activities coupled with constrained mining activity as factors behind the rally. Finally, Shanghai base metals had. a session of firm gains with prices hitting multi-month highs – with Nickel prices closing higher by almost 3% after a key miner Philippines reimposed lockdown measures, whilst Dalian iron ore rose some 3% on a rosier Chinese steel demand outlook

US Event Calendar

  • 7:30am: Challenger Job Cuts YoY, prior 305.5%
  • 8:30am: Initial Jobless Claims, est. 1.4m, prior 1.43m; Continuing Claims, est. 16.9m, prior 17m
  • 9:45am: Bloomberg Consumer Comfort, prior 44.3

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TDR’s U.S. Stock Market Preview For The Week Of August 8, 2022

A weekly stock market preview and the data that will impact the tape. Sunday Evening Futures Open – Stock Market Preview Weekend News And Developments…

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A weekly stock market preview and the data that will impact the tape.

Sunday Evening Futures Open – Stock Market Preview

Weekend News And Developments

Berkshire Hathaway dramatically slowed new investment in the second quarter after setting a blistering pace at the start of the year, as the US stock market sell-off pushed the insurance-to-railroad conglomerate to a $43.8bn loss.

China’s southern island province of Hainan started mass Covid-19 testing on Sunday, locking down more parts of the province of over 10 million residents, as authorities scramble to contain multiple Omicron-driven outbreaks, including the worst in capital Sanya, often called “China’s Hawaii”.

Cuba: 17 missing, 121 injured as fire rages in oil tank farm in Matanzas City

Equity positioning for both discretionary and systematic investors remains in the 12th percentile of its range since January 2010, according to Deutsche Bank published last week.

Fisker Inc. (NYSE:FSR) unveils a process for qualifying US-based reservation holders of the Fisker Ocean all-electric SUV to retain access to the existing federal tax credit. The current $7,500 tax credit would be unavailable should Congress pass the Inflation Reduction Act of 2022 and President Biden signs the legislation into law.

Former Labour prime minister Gordon Brown has called for an emergency budget before the UK hits a “financial timebomb” this autumn. Mr. Brown said millions would be pushed “over the edge” if the government does not address the cost of living crisis.

Israel said Sunday it killed a senior Islamic Jihad commander in a crowded Gaza refugee camp, the second such targeted attack since launching its high-stakes military offensive against the militant group just before the weekend. The Iran-backed militant group has fired hundreds of rockets at Israel in response, raising the risk of the cross-border fighting turning into a full-fledged war.

NexJ Systems (TSX: NXJ) announced financial results for its second quarter ended June 30, 2022.

Rhine river hit by drought conditions, hampers German cargo shipping. According to reports, transport prices have shot up as drought and hot weather have affected water levels in the river Rhine in Germany leading cargo vessels to reduce loads during transportation.

Taiwan’s defense ministry said it had detected 66 Chinese air force planes and 14 Chinese warships conducting activities in and around the Taiwan Strait on Sunday, Reuters reports. Thursday’s drills involved the live firing of 11 missiles.

Unifor: 1,800 members from across the country arrive in Toronto this weekend before Monday’s start to the union’s 4th Constitutional Convention, where delegates will elect a new National President and vote on key priorities and initiatives. Unifor is Canada’s largest union in the private sector, representing 315,000 workers in every major area of the economy. 

U.S. rate futures have priced in a 69% chance of a 75 bps hike at its September meeting, up from about 41% before the payrolls data. Futures traders have also factored in a fed funds rate of 3.57% by the end of the year.

What The Analysts Are Saying…

Anybody that jumped on the ‘Fed is going to pivot next year and start cutting rates’ is going to have to get off at the next station, because that’s not in the cards. It is clearly a situation where the economy is not screeching or heading into a recession here and now.” — Art Hogan, chief market strategist at B. Riley Financial

“It is not a market bottom, things are not going to go up consistently from here because we are going to be buying low tech products for a while, so everyone has something to make up as COVID demand = pre-COVID​, there are fewer units for this. Reality check – unlike ‘Big Tech’, consumer discretionary related companies are offering more cautious guidance.”Morgan Stanley analyst commentary on a potential market bottom

The fact of the matter is this (Aug. 5 nonfarm payroll report) gives the Fed additional room to continue to tighten, even if it raises the probability of pushing the economy into recession. It’s not going to be an easy task to continue to tighten without negative repercussions for the consumer and the economy”. — Jim Baird, chief investment officer at Plante Moran Financial Advisors

“We are surprised to not see investors start to chase upside calls in fear of underperforming the market. People are just watching.” — Matthew Tym, head of equity derivatives trading at Cantor Fitzgerald

What We’re Watching

Psychedelic Sector Gaining Momentum: What started out as bottoming action after a protracted multi-quarter decline has now morphed into a tangible bullish impulse. We believe Netflix new docuseries How To Change Your Mind has played an important roll in the creation of critical mass awareness for the sector—and a rebound in broad market risk assets hasn’t hurt. At the tip of the spear for this sentiment shift is COMPASS Pathways plc (CMPS), which has risen 62.64% since  the docuseries debuted on July 12. Price on the benchmark Horizons Psychedelic Stock Index ETF has now breached the 20-day MA/EMA.

We are watching to see if investor sentiment shifts into laggard names such as Cybin Inc. and MindMed, which has continued to fall following a proposed 15-1 reverse stock split initiative announced this year. Many Tier-2/3 names still 90%+ off their highs…

Revive Therapeutics (RVV:CSE, RVVTF:OTC): This has been on our radar for the last couple of weeks, and remains on our watch list. The company has already confirmed that their statistician is in possession of 210 unblinded patient data for its Phase 3 clinical trial to evaluate Bucillamine to treat COVID-19. The company is currently attempting to revise endpoint data from a hospitalization/death focus to a symptoms focus. If they are to achieve this, it will mark a material event in the course of the trial.

YTD performance (+33.09%), Revive Therapeutics (RVVTF); Red line = 7day EMA

We believe an endpoint decision, either positive or negative, is imminent and will have cause a material price action event.

Consumer Price Index, August 10: Consumer inflation expectations for July are released by the New York Fed, while the University of Michigan’s preliminary survey of consumers for August is on tap. Taken together, these should give investors a better picture of how consumers are feeling about current economic conditions. 

As of June, it’s running at 9.1% on an annual basis. Investors, economists and consumers will be watching to see if price increases are easing as everything from gasoline to food is elevated.

Given the mixed signals on the overall state of the economy (i.e. indications of recession vs. this week’s strong nonfarm payrolls number), CPI will be in-focus by market participants. Scotiabank expects 8.9% y/y (9.1% prior) and 0.4% m/m for headline CPI; ex-food-and-energy: 6.1% y/y led by a 0.6% m/m gain.

Pot stocks earnings continue, with several Tier-1/Teri-2 names reporting including Curaleaf Holdings, Trulieve Cannabis, Marimed Inc., Cronos Group, TerrAscend Corp. and more. Last Wednesday, Green Thumb Industries allayed fears somewhat that this earnings season would be a write-off, producing solid numbers which beat expectations on several key metrics. An additional strong report or two will go a long way to help improve sentiment for a sector that’s been decimated over the past six quarters.

U.S. Economic Calendar

TIME (ET)REPORTPERIODMEDIAN FORECASTPREVIOUS
Monday, August 8
11:00 AMNY Fed 3-year inflation expectationsJuly3.60%
Tuesday, Aug. 9
6:00 AMNFIB small-business indexJuly89.589.5
8:30 AMProductivityQ2-4.30%-7.30%
8:30 AMUnit labor costsQ29.30%12.60%
Wednesday, August 10
8:30 AMConsumer price indexJuly0.30%1.30%
8:30 AMCore CPIJuly0.60%0.70%
8:30 AMCPI (year-over-year)July-8.70%9.10%
8:30 AMCore CPI (year-over-year)July6.10%5.90%
10:00 AMWholesale inventories (revision)June1.90%1.70%
2:00 PMFederal budget (compared with year earlier)July-$302 billion
Thursday, August 11
8:30 AMInitial jobless claimsAug. 6265,000260,000
8:30 AMContinuing jobless claimsJuly 301.42 million
8:30 AMProducer price indexJuly0.20%1.10%
Friday, Aug. 12
8:30 AMImport price indexJuly-0.80%0.20%
10:00 AMUMich consumer sentiment index (preliminary)Aug.5352
10:00 AMUMich 5-year inflation expectations (preliminary)Aug.2.90%

Meme Of The Week

Key Earnings (US Markets)

DateCompanySymbolEarnings estimate
Monday, August 83D SystemsDDD$0.00 per share
BarrickGOLD$0.22
BioNTechBNTX$7.08
EnergizerENR$0.76
News Corp.NWSA$0.08
NovavaxNVAX$5.18
Palantir TechnologiesPLTR$0.03
Take-Two Interactive SoftwareTTWO$0.86
Tyson FoodsTSN$1.97
UpstartUPST$0.08
Tuesday, Aug. 9Akamai TechnologiesAKAM$1.31
AramarkARMK$0.24
Bausch HealthBHC$0.91
Carlyle GroupCG$1.07
CoindeskCOIN-$2.68
Cronos GroupCRON-$0.07
EbixEBIX$0.58
EmersonEMR$1.29
GlobalFoundriesGFS$0.45
Grocery OutletGO$0.24
H & R BlockHRB$1.24
Hilton Grand VacationsHGV$0.88
Hyatt HotelsH$0.03
IAC/InterActiveCorpIAC-$2.35
iRobotIRBT-$1.55
Maxar TechnologiesMAXR$0.12
Norwegian Cruise LineNCLH-$0.83
Plug PowerPLUG-$0.20
Rackspace TechnologyRXT$0.16
Ralph LaurenRL$1.71
RobloxRBLX-$0.26
Spirit AirlinesSAVE-$0.46
Super Micro ComputerSMCI$2.35
SyscoSYY$1.11
The Trade DeskTTD$0.20
TTEC HoldingsTTEC$0.85
Unity SoftwareU-$0.21
Warner Music GroupWMG$0.20
World Wrestling EntertainmentWWE$0.55
Wynn ResortsWYNN-$0.97
Wednesday, August 10AppLovinAPP$0.50
CoherentCOHR$2.13
CoupangCPNG-$0.10
CyberArk SoftwareCYBR$0.01
Dutch BrosBROS$0.07
Fox Corp.FOXA$0.77
Franco-NevadaFNV$0.98
Jack in the BoxJACK$1.42
Manulife FinancialMFC$0.76
MatterportMTTR-$0.14
Pan Am SilverPAAS$0.14
Red Robin GourmetRRGB-$0.16
SonosSONO$0.21
TraegerCOOK$0.04
Wendy’sWEN$0.22
Wolverine World WideWWW$0.65
Thursday, August 11AerCapAER$1.42
BaiduBIDU$10.92
Brookfield Asset ManagementBAM$0.69
Canada GooseGOOS$2.98
Cardinal HealthCAH$1.18
Dillard’sDDS$2.88
Flower FoodsFLO$0.27
IlluminaILMN$0.64
LegalZoomLZ$0.02
Melco Resorts & EntertainmentMLCO-$0.44
NioNIO-$1.36
PoshmarkPOSH-$0.25
Rivian AutomotiveRIVN-$1.63
Ryan Specialty GroupRYAN$0.35
Six FlagsSIX$1.04
Solo BrandsSOLO$0.28
ToastTOST-$0.12
Utz BrandsUTZ$0.12
Warby ParkerWRBY-$0.02
W&T OffshoreWTI$0.37
Wheaton Precious MetalsWPM$0.32
Friday, Aug. 12Broadridge FinancialBR$2.65
Honest CompanyHNST$-$0.09
Spectrum BrandsSPB$1.42

FDA Calendar

None

Source: CNN Business – TDR’s stock market preview sentiment indicator

Past Week What’s Hot… and What’s Not

Source: TradingView – TDR’ stock market preview what’s hot this past week

Top 12 High Short Interest Stocks

TickerCompanyExchangeShortIntFloatShares O/SIndustry
BBBYBed Bath & Beyond Inc.Nasdaq46.38%61.57M79.96MRetail (Specialty Non-Apparel)
ICPTIntercept Pharmaceuticals IncNasdaq43.76%23.62M29.71MBiotechnology & Medical Research
MSTRMicroStrategy IncNasdaq39.29%9.32M9.33MSoftware & Programming
BYNDBeyond Meat IncNasdaq37.91%56.79M63.54MFood Processing
SWTXSpringWorks Therapeutics IncNasdaq37.51%31.64M49.41MBiotechnology & Medical Research
BIGBig Lots, Inc.NYSE37.37%26.49M28.92MRetailers – Discount Stores
EVGOEvgo IncNasdaq35.65%67.76M69.00MUtilities – Electric
UPSTUpstart Holdings IncNasdaq35.60%72.32M84.77MConsumer Lending
BGFVBig 5 Sporting Goods CorpNasdaq34.65%20.85M22.33MRetailers – Miscellaneous Specialty
SRGSeritage Growth PropertiesNYSE34.38%23.58M43.68MReal Estate Operations
NKLANikola CorporationNasdaq32.77%265.95M421.14MAuto & Truck Manufacturers
BLNKBlink Charging CoNasdaq32.54%33.98M50.20MUtilities – Electric

Tags: stock market preview, stock market preview August 8, 2022.

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Senate Passes $740 Billion Tax, Climate Package — Will Go To House Next

Senate Passes $740 Billion Tax, Climate Package — Will Go To House Next

Update (1532ET): After much wrangling, the Democrats finally passed…

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Senate Passes $740 Billion Tax, Climate Package -- Will Go To House Next

Update (1532ET): After much wrangling, the Democrats finally passed their sweeping economic package through the Senate on Sunday.

The estimated $740 billion "Inflation Reduction Act" - far less ambitious than their original $3.5 trillion vision - next heads to the House, where its passage is a foregone conclusion. According to Axios, a vote could come as early as Friday before it heads to President Biden's desk.

The package includes provisions to address climate change, pharmaceutical costs, and a supercharged IRS.

"It’s been a long, tough and winding road, but at last, at last we have arrived," said Senate Majority Leader Chuck Schumer (D-NY). "The Senate is making history. I am confident the Inflation Reduction Act will endure as one of the defining legislative measures of the 21st century."

As the Washington Post notes, "Senators engaged in a round-the-clock marathon of voting that began Saturday and stretched late into Sunday afternoon. Democrats swatted down some three dozen Republican amendments designed to torpedo the legislation. Confronting unanimous GOP opposition, Democratic unity in the 50-50 chamber held, keeping the party on track for a morale-boosting victory three months from elections when congressional control is at stake."

And as Axios reports,

The Senate returned to the Capitol Saturday afternoon, and began voting late Saturday night and into Sunday on a series of amendments — part of the process known as "vote-a-rama."

  • Senate Republicans offered dozens of amendments aimed at minimizing the bill, including stripping out funding for the Internal Revenue Service and eliminating COVID-19-related school mandates.
  • Democrats held firm in their unity, with the help of Harris, of preserving the core elements of the package and voting down each GOP amendment.

.  .  .

The bill includes:

  • $370 billion for climate change - the largest investment in clean energy and emissions cuts the Senate has ever passed.
  • Allows the federal health secretary to negotiate the prices of certain expensive drugs for Medicare.
  • Three-year extension on healthcare subsidies in the Affordable Care Act.
  • 15% minimum tax on corporations making $1 billion or more in income. The provision offers more than $300 billion in revenue.
  • IRS tax enforcement.
  • 1% excise tax on stock buybacks.

Drilling down on the climate portion - Axios' Andrew Freedman writes:

  • This includes tax incentives to manufacture and purchase electric vehicles, generate more wind and solar electricity and support fledgling technology such as direct air capture and hydrogen production. 
  • Independent analyses show the bill, combined with other ongoing emissions reductions, would cut as much as 40% of U.S. greenhouse gas emissions by 2030, short of the White House's 50% reduction target. However, if enacted into law, it would reestablish U.S. credibility in international climate talks, which had been flagging due in part to congressional gridlock. 
  • As part of Democrats' concessions to Sen. Manchin, the bill also contains provisions calling for offshore oil lease sales in the Gulf of Mexico and off the coast of Alaska, and a commitment to take up a separate measure to ease the permitting of new energy projects. 

*  *  *

Senate Democrats late on Aug. 6 advanced a mammoth spending bill on climate and energy, health care, and taxes, after overcoming unanimous Republican opposition in the evenly divided chamber.

The procedural vote to advance the Democratic bill - which authorizes over $400 billion in new spending - was 51–50 after Vice President Kamala Harris arrived at the Capitol to cast a vote, breaking the deadlock in the Senate over the measure that Democrats say would reform the tax code, lower the cost of prescription drugs, invest in energy and climate change programs, all while lowering the federal deficit.

The vote means that senators will have 20 hours to debate on the measure, followed by a vote-a-rama, a marathon open-ended series of amendment votes that has no time limit. After that, the bill will head to a final vote. The measure is anticipated to pass the chamber as early as this weekend.

The House, where Democrats have a majority, could give the legislation final approval on Aug. 12, when lawmakers are scheduled to return to Washington.

The vote came after the Senate parliamentarian - the chamber’s nonpartisan rules arbiter - gave a thumbs-up to most of the Democrats’ revised 755-page bill.

But Democrats had to drop a significant part of their plan for lowering prescription drug prices, Parliamentarian Elizabeth MacDonough said.

The provision would have essentially forced companies not to raise prices higher than inflation. MacDonough said Democrats violated Senate budget rules with language in the bill imposing hefty penalties on drugmakers who raise their prices beyond inflation in the private insurance market.

As Mimi Nguyen Ly details at The Epoch Times, while the bill’s final costs are still being determined, it includes about $370 billion on energy and climate programs over the next 10 years, and about $64 billion to extend subsidies for Affordable Care Act program for federal subsidies of health insurance for three years through 2025.

It also seeks generate about $700 billion in new revenue over the next 10 years, which would leave roughly $300 billion in deficit reduction over the coming decade, which would represent just a tiny proportion of the next 10 year’s projected $16 trillion in budget shortfalls.

A large portion of the $700 billion—an estimated $313 billion—is expected to be generated by increasing the corporate minimum tax to 15 percent, while the remaining amounts include $288 billion in prescription drug pricing reform and $124 billion in Internal Revenue Service tax enforcement.

According to the current version of the bill, the new 15 percent minimum tax would be imposed on some corporations that earn over $1 billion annually but pay far less than the current 21 percent corporate tax. Companies buying back their own stock would be taxed 1 percent for those transactions, swapped in after Sinema refused to support higher taxes on private equity firm executives and hedge fund managers. The IRS budget would be increased to strengthen its tax collections.

The White House said in a statement of administrative policy on Aug. 6 that it “strongly supports passage” of the bill.

“This legislation would lower health care, prescription drug, and energy costs, invest in energy security, and make our tax code fairer—all while fighting inflation and reducing the deficit,” the statement reads.

“This historic legislation would help tackle today’s most pressing economic challenges, make our economy stronger for decades to come, and position the United States to be the world’s leader in clean energy.”

Republicans say the legislation is simply an alternate, dwindled version to the Democrat’s earlier Build Back Better bill—a multitrillion-dollar social spending package that was a major agenda of President Joe Biden—that Democrats have now dubbed the “Inflation Reduction Act of 2022.”

Senate Minority Leader Mitch McConnell (R-Ky.) said Democrats “are misreading the American people’s outrage as a mandate for yet another reckless taxing and spending spree.” He said Democrats “have already robbed American families once through inflation and now their solution is to rob American families yet a second time.”

“There is no working family in America whose top priorities are doubling the size of the IRS and giving rich people money to buy $80,000 electric cars,” McConnell said in a separate statement on Twitter.

“Americans want Washington to address inflation, crime, and the border—not another reckless liberal taxing and spending spree.”

Democrats have said the measure would “address record inflation by paying down our national debt, lowering energy costs, and lowering healthcare costs,” but Republicans have criticized the measure as having no potential other than to make matters worse, nicknaming the legislation “Build Back Broke,” in part because the bill would fulfill many parts of Biden’s Build Back Better agenda.

“The time is now to move forward with a big, bold package for the American people,” said Senate Majority Leader Chuck Schumer (D-N.Y.).

“This historic bill will reduce inflation, lower costs, fight climate change. It’s time to move this nation forward.”

But not every Democrat is buying what Chuck is selling...

As John Solomon reports at JustTheNews.com, Sen. Bernie Sanders, the former presidential candidate and proud socialist, on Saturday attacked President Joe Biden‘s Inflation Reduction Act for failing to live up to its name, after the non-partisan Congressional Budget Office declared it would have a minimal impact on surging prices.

“I want to take a moment to say a few words about the so-called Inflation Reduction Act that we are debating this evening," Sanders said just after voting with Democrats to advance the bill to debate on the Senate floor.

"I say so-called because according to the CBO and other economic organizations that have studied this bill, it will in fact have a minimal impact on inflation."

CBO declared this week that the $740 billion piece of legislation would only affect inflation by 0.1% in either direction.

"I don't find myself saying this very often. But on that point, I agree with Bernie," Sen. John Thune, R-S.D., told Insider.

Overall, economic analysts are divided on the measure, with some having predicted that the bill will worsen inflation and lead to stagnation in growth.

As Will Cain explained in an excellent monologue reality check, "look at the name of the bill, whatever it is, you can be sure the legislation will do the opposite."

Finally, as Goldman details in a new notes, the net fiscal impact of these policies continues to look very modest, likely less than 0.1% of GDP for the next several years...

While the final outcome may still yet differ in details, the fiscal impact is likely to be similar.

Tyler Durden Sun, 08/07/2022 - 15:32

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UN Warns Of ‘Worrying And Dangerous’ Conspiracy Theories

UN Warns Of ‘Worrying And Dangerous’ Conspiracy Theories

The United Nations would like everyone to be on the lookout for ‘worrying and dangerous’…

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UN Warns Of 'Worrying And Dangerous' Conspiracy Theories

The United Nations would like everyone to be on the lookout for 'worrying and dangerous' conspiracy theories - especially those that might lead people to the conclusion that COVID-19 escaped from a lab in Wuhan, China... you know, the thing the WHO just admitted could very well be the case, and which Sen. Rand Paul (R-KY) has launched recent investigations into.

Some background

Before we get into the UN's latest salvo in the war over narratives (feel free to scroll down if you're a regular reader); We know from government contracts, FOIA records, and leaked emails that the US government was conducting risky gain-of-function research on US soil until former President Obama banned it in 2014 over ethical questions raised by the scientific community. The 'research' included manipulating bat Covid to be more transmissible to humans, and following Obama's ban, was funneled overseas to the Wuhan Institute of Virology through New York nonprofit, EcoHealth Alliance - whose CEO Peter Daszak secured lucrative contracts to study and manipulate bat coronaviruses in Wuhan China four months before Obama's ban.

Daszak was the guy behind The Lancet's "it couldn't have come from a lab" Natural Origin statement - for which he reportedly engaged in a "bullying campaign" - before generating significant controversy over conflicts of interest involving many of its authors and co-signatories, to which the Lancet later admitted.

The first $666,442 installment of EcoHealth's $3.7 million NIH grant was paid in June 2014, with similar annual payments through May 2019 under the "Understanding The Risk Of Bat Coronavirus Emergence" project.

Then, in 2017, a subagency of the National Institutes of Health (NIH) - headed by Dr. Anthony Fauci - resumed funding a controversial grant to genetically modify bat coronaviruses in Wuhan, China without the approval of a government oversight body.

Notably, the WIV "had openly participated in gain-of-function research in partnership with U.S. universities and institutions" for years under the leadership of Dr. Shi 'Batwoman' Zhengli, according to the Washington Post's Josh Rogin.

We also know (thanks to a FOIA lawsuit by The Intercept) that Daszak wanted to release 'Chimeric Covid Spike Proteins' Into Bat Populations Using 'Skin-Penetrating Nanoparticles,' only for the 'DEFUSE' proposal to be denied by DARPA on the grounds that it was too risky.

Further reading:

We challenge the UN to 'debunk' any of the above.

Now that you're up to speed

Enter the UN's new #ThinkBeforeSharing campaign, which helps people "learn how to identify, debunk, react to and report on conspiracy theories to prevent their spread."

To aid gullable individuals navigate the information highway without hitting any conspiracy potholes, UNESCO provides some helpful infographics - one of which thanks Stephen Lewandowsky - Australian psychologist and co-author of a March 2022 Scientific American report complaining about how "The Lab-Leak Hypothesis Made It Harder for Scientists to Seek the Truth."

So the default position of those behind the UN's "watch out for conspiracy theories" campaign is that the lab leak is a conspiracy theory. Right.

They recommend taking action when you've "identified a conspiracy theory," but that you don't get lured into an argument with a conspiracy theorist.

"Any argument may be taken as proof that you are part of the conspiracy and reinforce that belief," which will cause the conspiracy theorist to "argue hard to defend their beliefs."

So what to do? Show "empathy," and avoid "ridiculing them."

"If you are certain you have encountered a conspiracy theory," you must "react" immediately and post a link to a "fact-checking website" in the comments.

In short - this (from 2020):

Stay safe out there citizen!

Tyler Durden Sun, 08/07/2022 - 14:00

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