Mon 9 Oct 2017

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In Portfolioticker today

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  • Today at the stock market Opinion
  • The portfolio today Opinion
  • News
  • flag_japan Japan Update
  • flag_china China Update
  • Today at the stock market

    bull/bearWall Street fell from record levels on Monday as gains in Microsoft and other technology stocks failed to offset a drop in General Electric and a slide in healthcare stocks. The S&P 500 has rallied 14% in 2017 and last week hit record highs, buoyed by strong company earnings and enthusiasm that President Donald Trump will cut corporate taxes.

    • The S&P 500 fell 0.18% to 2,544.73.
    • The Dow Jones Industrial Average fell 0.06% to end at 22,761.07.
    • The Nasdaq Composite fell 0.16% to 6,579.73.
    • The CBOE Volatility index (VIX) rose 0.77 points to 10.42, its highest in two weeks.
    • Declining issues outnumbered advancing ones on the NYSE by a 1.21-to-1 ratio; on Nasdaq, a 1.49-to-1 ratio favored decliners.
    • About 4.4 billion shares changed hands on U.S. exchanges, well below the 6.1 billion daily average for the past 20 trading days, according to Thomson Reuters data.

    JPMorgan Chase and Citigroup will report profits on Thursday, kicking third-quarter corporate reporting season into high gear as investors look for strong growth to justify pricey valuations. “Unlike the restaurant chains, movie chains and homebuilders and some of the discretionary stocks hurt by the hurricanes, I don’t expect the banks to be affected by the non-recurring blips during the quarter,” said Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Oklahoma.

    Overall, earnings at S&P 500 companies are expected to have increased 4.8% last quarter, according to Thomson Reuters data, down from the double-digit growth recorded in the first two quarters of this year.

    GE shares fell 3.94% after the conglomerate named a new CFO and said it gave activist investment firm Trian Fund Management a board seat.

    Nvidia rose 2.26% and the S&P 500 information technology index rose 0.24%, bringing its gain in 2017 to 28%.

    Shares of cinema stocks AMC Entertainment Holdings and Regal Entertainment fell more than 4% after domestic opening weekend ticket sales for science fiction sequel “Blade Runner 2049” fell short of expectations.

    Weighing on the healthcare sector, Express Scripts fell 5% after Raymond James downgraded the stock to “underperform” from “market perform”. [Lloyd notes:Amazon is reported to be considering selling pharmaceuticals.]

    Tesla fell 3.91% after pushing back the unveiling of its big rig truck to mid-Nov 2017.

    Viacom dropped 6.37% after Citigroup downgraded the stock to “sell”, citing risks that pay-TV firms would stop carrying its channels.Reuters

    Market indices

    Market indices
    ^ Market indices today (mouseover for 12 month view) Chart: Google Finance

    Index Ticker Today Change 31 Dec 16 YTD
    S&P 500 SPX (INX) 2,544.73 -0.19% 2,238.83 +13.66%
    DJIA INDU 22,761.07 -0.06% 19,762.60 +15.17%
    NASDAQ IXIC 6,579.73 -0.16% 5,383.12 +22.22%

    Portfolio Indices

    USD and AUD denominated indices over the past 52 weeks (Chart: Bunting)
    ^ USD and AUD denominated indices over the past 52 weeks Chart: Bunting

    Index values

    Index Currency Today Change 31 Dec 16 YTD
    USD-denominated Index USD 2.816 +0.24% 2.105 +33.82%
    Valuation Rate USD/AUD 0.78075 -0.13% 0.72663 +7.44%
    AUD-denominated Index AUD 3.610 +0.36% 2.895 +24.68%

    Portfolio stock prices

    :-) Ebay closed on its 5 Oct 2017 record of $38.99.
    :-) PayPal closed on a record high of $66.23, up 0.27% on Friday’s record of $66.05.
    :-) Visa closed on a record high of $107.01, up 0.26% on Friday’s record of $106.73.

    Stock Ticker Today Change 31 Dec 16 YTD
    Alphabet A GOOGL $992.31 -0.13% $792.45 +25.22%
    Alphabet C GOOG $977.00 -0.19% $771.82 +26.58%
    Apple AAPL $155.84 +0.35% $115.82 +34.55%
    Amazon AMZN $990.99 +0.14% $749.87 +32.15%
    Ebay EBAY $38.99 +0.46% $29.69 +31.32%
    Facebook FB $172.5 +0.16% $115.05 +49.93%
    PayPal PYPL $66.23 +0.27% $39.47 +67.79%
    Twitter TWTR $17.67 -1.01% $16.30 +8.40%
    Visa V $107.01 +0.26% $78.02 +37.15%
    VMware VMW $111.85 +0.29% $78.73 +42.06%



    DXY movements
    ^ Bloomberg Dollar Spot Index (DXY) movements today (mouseover for 12 month view) Chart: Bloomberg

    The Bloomberg Dollar Spot Index (DXY) fell 0.1%.
    The EUR rose 0.2% to USD 1.1749.


    AUD movements
    ^ AUD movements against the USD today (mouseover for 12 month view) Chart:

    Oil and Gas Futures

    Futures prices

    West Texas Intermediate crude rose 29 cents to settle at $49.58/barrel.Bloomberg

    Prices are as at 15:48 EDT

    • NYMEX West Texas Intermediate (WTI): $49.51/barrel +0.45% Chart
    • ICE (London) Brent North Sea Crude: $55.66/barrel +0.07% Chart
    • NYMEX Natural gas futures: $2.83/MMBTU -1.01% Chart

    flag_japan Japan update

    Currency: USD/JPY

    JPY movements
    ^ JPY movements against the USD over the past month (mouseover for inverse) Chart:

    Stockmarket: Nikkei 225

    Japan’s stock markets are closed for a public holiday.

    flag_china China update

    Foreign Exchange Reserves. Sep 2017

    China’s foreign exchange reserves increased by USD 17 billion to an 11-month high of USD 3.109 trillion at the end of September 2017, above market expectations of USD 3.100 trillion. It was the first time that the country’s reserves have climbed for eight months in a row since June 2014, as tighter regulations and a stronger yuan discouraged capital outflows. Meanwhile, the value of gold reserves fell to USD 76.005 billion at the end of September, from USD 77.702 billion at end-August. Foreign Exchange Reserves in China averaged 934184.31 USD Million from 1980 until 2017, reaching an all time high of 3993212.72 USD Million in June of 2014 and a record low of 2262 USD Million in December of 1980.TradingEconomics

    Caixin China General Services PMI. Sep 2017

    Key points:

    • Services activity growth weakens to 21-month low, while manufacturing output rises modestly
    • Total new work expands at weakest pace since June
    • Cost pressures mount


    The Caixin China Composite PMI™ data (which covers both manufacturing and services) signalled a weaker expansion in total Chinese business activity at the end of the third quarter. Notably, the Composite Output Index fell from 52.4 in August to a three-month low of 51.4 in September.

    The slowdown was driven by weaker increases in output at both manufacturing and services companies. A drop in the seasonally adjusted Caixin China General Services Business Activity Index from 52.7 to 50.6 in September pointed to only a marginal increase in services activity that was the slowest for 21 months. At the same time, growth in manufacturing production edged down to a three-month low.

    Weaker expansions in activity coincided with a slowdown in new order growth across both monitored sectors. While manufacturers signalled the softest increase in new business for three months, service providers saw only a modest upturn in new order books. A number of companies mentioned that relatively subdued client demand had weighed on sales at the end of the third quarter. As a result, composite new work increased at the weakest pace since June.

    In line with the trend for new orders, services companies increased their staffing levels at a slower rate in September. Furthermore, the latest expansion of payroll numbers was only marginal. At the same time, goods producers signalled a further decline in employment, though the rate of job shedding eased to a six-month low. Job creation across the service sector largely offset job cuts at manufacturers to leave overall employment little-changed for the second month in a row.

    After a four-month sequence of accumulation, the level of outstanding work at Chinese services companies declined during September. That said, the rate of depletion was only slight. In contrast, backlogs of work continued to rise at manufacturers, though the rate of expansion was the weakest seen since April. At the composite level, the level of work-in-hand (but not yet completed) rose at the softest pace for a year- and-a-half.

    Services companies signalled only a marginal increase in cost burdens at the end of the third quarter, despite the rate of inflation picking up for the second month in a row. This contrasted with a sharp and accelerated rise in manufacturers’ input costs. Notably, goods producers saw the steepest rise in input prices since last December, with many firms linking the increase to greater raw material costs. Consequently, the rate of composite input price inflation quickened to an eight-month high.

    Reflective of the trend for input costs, output charges set by services companies rose only slightly during September. This contrasted with a marginal drop in prices during August, however. Meanwhile, stronger cost pressures at manufacturers led factory gate charges to increase sharply as firms sought to protect their margins. Moreover, the rate of inflation was the quickest recorded for nine months. Selling prices at the composite level subsequently increased at the fastest pace since last December.

    Slower growth in output and new business dampened overall business confidence in September, with both manufacturers and service providers expressing a weaker degree of optimism compared to the previous month.

    Commenting on the China General Services PMI™ data, Dr. Zhengsheng Zhong, Director of Macroeconomic Analysis at CEBM Group said:
    ‘The Caixin China General Services Business Activity Index came in at 50.6 in September, the lowest since December 2015 and down 2.1 points from the previous month. Although new business rose at a slower rate last month than in August, input costs and prices charged both increased. The Caixin China Composite Output Index was 51.4 last month, the weakest since June and down 1.0 point from August. The Chinese economy generally held up well in the third quarter. However, the expansion in both manufacturing and services cooled in September, suggesting downward pressure on economic growth may re-emerge in the fourth quarter.’

    IHS Markit, “Caixin China General Services PMI. Sep 2017“, 9 Oct 2017 TradingEconomics

    Currency: USD/CNY

    CNY movements
    ^ CNY movements against the USD over the past month (mouseover for inverse) Chart:

    Stockmarket: CSI300

    CSI300 movements
    ^ Shanghai CSI300 movements over the past week Chart: Google Finance