Summary Of the Markets Today:

• The Dow closed up 244 points or 0.60%, (Closed at 41,198, New Historic high 41.222)
• Nasdaq closed down 2.77%,
• S&P 500 closed down 1.39%,
• Gold $2,464 down $4.10,
• WTI crude oil settled at $83 up $2.10,
• 10-year U.S. Treasury 4.151 down 0.016 points,
• USD index $103.76 up $0.51,
• Bitcoin $64,603 down $471 or 0.72%,

*Stock data, cryptocurrency, and commodity prices at the market closing.

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Click here to read our current Economic Forecast – July 2024 Economic Forecast: One Recession Flag Removed But Little Indication The Economy Is Strengthening

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Today’s Economic Releases Compiled by Steven Hansen, Publisher:

Privately-owned housing units authorized by building permits in June 2024 were 3.1% below June 2023. Privately-owned housing starts in June were 4.4% below June 2023. Privately-owned housing completions in June were 15.5% above June 2023. At first glance you would think there is something wrong with building permits and starts. However, there is a massive quantity of homes under construction – and the industry does not need to put more homes into the pipeline. The bottom line – new homes completed are growing at a good rate.

Industrial production for June 2024 rose 1.6% year-over-year with components manufacturing up 1.1% year-over-year, mining down 0.6% year-over-year, and utilities up 7.9% year-over-year. Capacity utilization moved up to 78.8 percent in June, a rate that is 0.9 percentage point below its long-run (1972–2023) average. This month’s manufacturing significant growth clearly moves manufacturing out of a recession – but I am not too optimistic that manufacturing growth spurt will continue long term.

The Beige Book for July 2024 states:

Economic activity maintained a slight to modest pace of growth in a majority of Districts this reporting cycle. However, while seven Districts reported some level of increase in activity, five noted flat or declining activity—three more than in the prior reporting period. Wages continued to grow at a modest to moderate pace in most Districts, while prices were generally reported to have risen modestly. Household spending was little changed this period according to most District banks. Auto sales varied across Districts this cycle, but some Districts noted that sales were lower due in part to a cyberattack on dealerships and high interest rates. Most Districts saw soft demand for consumer and business loans. Reports on residential and commercial real estate markets varied, but most banks reported only slight changes, if any, in recent weeks. Travel and tourism grew steadily and was on par with seasonal expectations. Agricultural conditions varied in tandem with sporadic droughts across the nation. Districts also reported widely disparate trends in manufacturing activity ranging from brisk downturn to moderate growth. Retail restocking spurred slight growth in transportation activity. Meanwhile, tight capacity in ocean shipping led to a surge in spot rates. Expectations for the future of the economy were for slower growth over the next six months due to uncertainty around the upcoming election, domestic policy, geopolitical conflict, and inflation.

Labor Markets

On balance, employment rose at a slight pace in the most recent reporting period. Most Districts reported employment was flat or up slightly, while a few Districts reported modest employment growth. Several Districts reported declines in employment in the manufacturing sector due to slowdowns in new orders. Skilled-worker availability remained a challenge across all Districts; however, several Districts reported some improvement in labor supply conditions. Additionally, labor turnover was lower, which reduced demand to find new workers. Looking ahead, contacts in several Districts expect to be more selective on who they hire and not backfill all open positions. Wages grew at a modest to moderate pace in most Districts. However, several Districts reported some slowing of wage growth due to increased worker availability and less competition for workers.

Prices

Prices increased at a modest pace overall, with a couple Districts noting only slight increases. While consumer spending was generally reported as showing little to no change almost every District mentioned retailers discounting items or price-sensitive consumers only purchasing essentials, trading down in quality, buying fewer items, or shopping around for the best deals. Most Districts noted that input costs were beginning to stabilize; however, Atlanta specifically noted products like copper and electrical supplies have seen a notable increase over this period.

The Beige Book is a Federal Reserve System publication about current economic conditions across the 12 Federal Reserve Districts. It characterizes regional economic conditions and prospects based on a variety of mostly qualitative information, gathered directly from each District’s sources. This months release shows a very modest deterioration from the previous report which agrees with our economic forecast which shows little change in economic conditions.

Here is a summary of headlines we are reading today:

• The EU Is Facing a Looming Gas Supply Crisis
• UAE Considering Building A Second Nuclear Power Plant
• Aluminum Prices Face Downward Pressure as Tariffs Influence Market Trends
• Oil Extends Gains As EIA Confirms Crude Draw, Rising Fuel Inventories
• Greece to Impose One-Off Windfall Tax on Gas Power Producers
• Nasdaq posts worst day since 2022, Dow gains 200 points as investors rotate out of tech: Live updates
• Fed Governor Waller sees central bank ‘getting closer’ to an interest rate cut
• Crypto-friendly VC investors plan donations to pro-Trump super PAC: CNBC Crypto World
• Pound hits highest level against dollar for a year
• 2-year Treasury yield falls for fifth session amid signs Fed may be moving closer to cutting rates
• Five of 12 Fed districts report flat or declining economic activity, Beige Book finds

Click on the “Read More” below to access these, other headlines, and the associated news summaries moving the markets today.

Summary Of the Markets Today:

• The Dow closed up 743 points or 1.85%,  (Closed at 40,954, New Historic high 40.989)
• Nasdaq closed up 0.20%,
• S&P 500 closed up 0.64%, (Closed at 5,667, New Historic high 5,670)
• Gold $2,472 up $42.90,
• WTI crude oil settled at $81 down $1.05,
• 10-year U.S. Treasury 4.162 up 0.065 points,
• USD index $104.22 up $0.03,
• Bitcoin $65,126 up $364 or 0.56%,

*Stock data, cryptocurrency, and commodity prices at the market closing.

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Click here to read our current Economic Forecast – July 2024 Economic Forecast: One Recession Flag Removed But Little Indication The Economy Is Strengthening

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Today’s Economic Releases Compiled by Steven Hansen, Publisher:

Advance estimates of U.S. retail and food services sales for June 2024 were up 0.2% year-over-year but down significantly from last month’s 3.2%. If you adjust for inflation, retail sales contracted. My numbers are different from the headline view as I do not use seasonally adjusted data which shows sales of $703.6 billion in June 2024 vs $$702.2 billion in June 2023 [you do not need to seasonally adjust data if you are using year-over-year comparisons]. The major declines were in motor vehicle sales and building materials. These are two sectors which decline early in a recession. This is not good news economically.

Import prices increased from 1.4% year-over-year in May to 1.6% in June 2024. Export prices increased from 0.5% year-over-year in May to 0.7% in June 2024. Like a broken record, I keep warning readers that the underlying inflation dynamics is growing – and the end to inflationary pressures is not within eyesight.

Here is a summary of headlines we are reading today:

• Construction Costs Remain Elevated Despite Stabilizing Base Metals
• Gulf Oil Producers Invest Heavily in Carbon Capture and Hydrogen
• IMF Cuts Saudi Economic Growth Projection On Oil Cuts
• WTI Falls To $80 Despite Expectations of Global Q3 Supply Deficit
• Exxon Plans Seventh Oil Project Offshore Guyana
• Trump’s VP Choice Could Signal Rollback of Climate Protections
• Dow rallies 700 points for best day in more than a year, Russell 2000 small-cap index jumps 3%: Live updates
• Elon Musk says SpaceX and X headquarters moving to Texas, blames new CA trans student privacy law
• Brain implant patient says OpenAI’s tech helps him communicate with family
• “Evacuate Now” Illinois Residents Told To Flee As Dam Failure Imminent
• Interest rates could stay higher for longer, warns IMF
• 2-year Treasury yield finishes lower for fourth session in a row after U.S. retail sales come in flat

Click on the “Read More” below to access these, other headlines, and the associated news summaries moving the markets today.

Summary Of the Markets Today:

• The Dow closed up 211 points or 0.53%, (Closed at 40,212, Historic high 40.351)
• Nasdaq closed up 0.40%,
• S&P 500 closed up 0.28%, (Closed at 5,631, New Historic high 5,667)
• Gold $2,427 up $6.00,
• WTI crude oil settled at $82 down $0.30,
• 10-year U.S. Treasury 4.224 up 0.038 points,
• USD index $104.22 up $0.130,
• Bitcoin $63,433 up $2,628 or 4.32%,

*Stock data, cryptocurrency, and commodity prices at the market closing.

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Click here to read our current Economic Forecast – July 2024 Economic Forecast: One Recession Flag Removed But Little Indication The Economy Is Strengthening

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Today’s Economic Releases Compiled by Steven Hansen, Publisher:

The July 2024 Empire State Manufacturing Survey headline general business conditions index was little changed at -6.6. New orders remained steady, while shipments inched just slightly higher. Manufacturing remains in a recession in the U.S.

Here is a summary of headlines we are reading today:

• JD Vance is Trump’s VP pick after Rubio and Burgum were passed over for running mate
• Roughly 13% of Mexican Steel Imports to Face Tariffs Under New Agreement
• Gas Prices Tick Higher As Oil Prices Fail To Gain Momentum
• What Does China’s GDP Miss Mean for Its Economy?
• Asian Market Buys First Oil Cargoes From Canada’s Trans Mountain Pipeline
• China’s Coal Production Hits Six-Month High
• Powell indicates Fed won’t wait until inflation is down to 2% before cutting rates
• Dow rises 200 points to close at a record after Trump survives assassination attempt: Live updates
• Crypto stocks like Coinbase and MicroStrategy soar, mirroring rally in bitcoin
• “It’s Staggering!” – AI’s Rapid Growth Threatens Energy Industry, Economy, & Climate
• Inflation is cooling. Why that’s not a headwind for corporate earnings.
• Options traders flash rare bullish signal for small-cap stocks

Click on the “Read More” below to access these, other headlines, and the associated news summaries moving the markets today.

Summary Of the Markets Today:

• The Dow closed up 247 points or 0.62%, (Closed at 40,001, Historic high 40.257)
• Nasdaq closed up 0.63%,
• S&P 500 closed up 0.55%, (Closed at 5,615, New Historic high 5,656)
• Gold $2,418 down $4.10,
• WTI crude oil settled at $82 down $0.41,
• 10-year U.S. Treasury 4.182 down 0.010 points,
• USD index $104.09 down $0.340,
• Bitcoin $57,595 down $254 or 0.44%,
• Baker Hughes Rig Count: U.S. -1 to 584 Canada +14 to 189

*Stock data, cryptocurrency, and commodity prices at the market closing.

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Click here to read our current Economic Forecast – July 2024 Economic Forecast: One Recession Flag Removed But Little Indication The Economy Is Strengthening

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Today’s Economic Releases Compiled by Steven Hansen, Publisher:

There are underlying elements for inflation. One of the major elements is the Producer Price Index (PPI). Unfortunately, the PPI Final Demand edged upward from 2.4% last month to 2.7% year-over-year in June 2024. This increase was driven by the services sector which jumped from 3.0% last month to 3.5% this month. I keep reminding readers that there are inflationary elements and forces that are not subsiding – and it is a mistake to believe inflation is going away.

Here is a summary of headlines we are reading today:

• China’s Role in Russia-Ukraine War Draws Scrutiny at NATO Summit
• U.S. Oil, Gas Drilling Activity Continues To Drop
• Neither Israel Nor Hezbollah Want All-Out War
• Europe Increasingly Reliant on American Diesel
• Brent Tops $86 on Hopes of Fed Cut in September
• Dow rises more than 200 points, touches new record above 40,000: Live updates
• JPMorgan’s Jamie Dimon warns inflation and interest rates may stay higher
• AT&T says hackers stole records of nearly all cellular customers’ calls and texts
• Southwest Airlines, Archer Aviation ink air-taxi deal
• 2-year Treasury yield ends at lowest since February after decline in consumer sentiment

Click on the “Read More” below to access these, other headlines, and the associated news summaries moving the markets today.

Summary Of the Markets Today:

• The Dow closed up 32 points or 0.08%,
• Nasdaq closed down 1.95%, (Closed at 18,283, New Historic high 18,671)
• S&P 500 closed down 0.88%, (Closed at 5,585, New Historic high 5,642)
• Gold $2,422 up $41.80,
• WTI crude oil settled at $83 up $0.89,
• 10-year U.S. Treasury 4.203 down 0.076 points,
• USD index $104.48 down $0.570,
• Bitcoin $57,385 down $327 or 0.57%,

*Stock data, cryptocurrency, and commodity prices at the market closing.

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Click here to read our current Economic Forecast – July 2024 Economic Forecast: One Recession Flag Removed But Little Indication The Economy Is Strengthening

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Today’s Economic Releases Compiled by Steven Hansen, Publisher:

Inflation, measured by the Consumer Price Index for all Urban Consumers (CPI-U), declined from 3.3% last month to 3.0% year-over-year in June 2024. This index if one removes food and energy declined from  3.4% year-over-year to 3.3%. I consider this a moderate decrease in inflation.

In the week ending July 6, the advance figure for seasonally adjusted initial unemployment claims 4-week moving average was 233,500, a decrease of 5,250 from the previous week’s revised average. The previous week’s average was revised up by 250 from 238,500 to 238,750. Unemployment claims have remained in a narrow range for over 2 years – and is showing little sign of growing unemployment.

Here is a summary of headlines we are reading today:

• Will China’s Central Bank Cut Rates to Boost Sagging Economy?
• India and Russia Deepen Trade Ties Despite Ukraine Conflict
• Copper Prices Bounce Back On Market Optimism
• U.S. Solar and Wind Power Generation Tops Nuclear for First Time
• The Future May Not Be As Electric as We Think
• Standard Chartered: Oil Demand Growth Will Decelerate in the Coming Months
• S&P 500 retreats from record as investors sell high-flying Big Tech stocks, Nvidia drops 5%: Live updates
• Here’s the inflation breakdown for June 2024 — in one chart
• Bitcoin could be heading for a ‘summer of 2021 style’ correction between record highs, data shows
• Tesla shares fall 6% after report of robotaxi unveiling delay
• 10-year Treasury yield dives after June CPI unexpectedly decreases

Click on the “Read More” below to access these, other headlines, and the associated news summaries moving the markets today.

Summary Of the Markets Today:

• The Dow closed up 429 points or 1.09%,
• Nasdaq closed up 1.18%, (Closed at 18,647, New Historic high 18,655)
• S&P 500 closed up 1.02%, (Closed at 5,634, New Historic high 5,635)
• Gold $2,378 up $7.50,
• WTI crude oil settled at $82 up $1.01,
• 10-year U.S. Treasury 4.278 down 0.020 points,
• USD index $105.03 down $0.100,
• Bitcoin $57,449 up $599 or 1.03%,

*Stock data, cryptocurrency, and commodity prices at the market closing.

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Click here to read our current Economic Forecast – July 2024 Economic Forecast: One Recession Flag Removed But Little Indication The Economy Is Strengthening

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Today’s Economic Releases Compiled by Steven Hansen, Publisher:

May 2024 sales of merchant wholesalers were up 1.9% from the revised May 2023 level. Total inventories of merchant wholesalers were down 0.5% from the revised May 2023 level. The May inventories/sales ratio for merchant wholesalers was 1.35. The May 2023 ratio was 1.39. My bottom line is that employment is growing in this sector (even faster than sales growth) whilst inventories are marginally falling – this seems to be a relatively above average sector in the economy right now.

Fed Chair Powell’s second day of the semiannual monetary policy testimony navigated politically charged questions which he declined to answer. Powell reiterated that he was not sending any signals about the outlook for monetary policy when he said that the risks are more balanced to the outlook in the context of the dual mandate. He said, “The job is not done on inflation,” and that there has been “considerable softening in the labor market”. I smiled when I read many stock market pumpers mistook his statements yesterday to mean that a federal funds rate cuts were coming soon.

Here is a summary of headlines we are reading today:

• Serbia’s Nuclear Future: A Delicate Balancing Act Between East and West
• BP Predicts Global Oil Demand Will Peak In 2025
• Hedge Funds Are Headhunting Succesful Power Traders
• Honeywell to Buy Air Products’ LNG Technology for $1.8 Billion
• The Countries Increasing Their Coal Dependency Despite Climate Pledges
• HubSpot shares plunge 12% on report that Alphabet is shelving interest in acquiring software company
• S&P 500 closes above 5,600 for the first time, lifted by gains in Big Tech: Live updates
• Key inflation report looms on Thursday as traders grow more confident in Fed rate cut
• Senators strike bipartisan deal for a ban on stock trading by members of Congress
• Goldman says investors should start shifting out of cash. Here’s where it sees opportunity
• Bitcoin hovers at $57,000 as Fed Chair Powell continues testimony on Capitol Hill: CNBC Crypto World
• Musk defeats ex-Twitter staff seeking $500m in severance
• Wall Street is becoming more skeptical of artificial-intelligence hype helping to power stocks

Click on the “Read More” below to access these, other headlines, and the associated news summaries moving the markets today.

Summary Of the Markets Today:

• The Dow closed down 53 points or 0.13%,
• Nasdaq closed up 0.14%, (Closed at 18,429, New Historic high 18,512)
• S&P 500 closed up 0.07%, (Closed at 5,577, New Historic high 5,591)
• Gold $2,371 up $7.50,
• WTI crude oil settled at $82 down $0.81,
• 10-year U.S. Treasury 4.294 up 0.026 points,
• USD index $105.12 up $0.120,
• Bitcoin $57,860 up $1,150 or 2.05%,

*Stock data, cryptocurrency, and commodity prices at the market closing.

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Click here to read our current Economic Forecast – July 2024 Economic Forecast: One Recession Flag Removed But Little Indication The Economy Is Strengthening

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Today’s Economic Releases Compiled by Steven Hansen, Publisher:

In today’s testimony to Congress on monetary policy, Fed Chair Jerome Powell stated in part:

The Committee has stated that we do not expect it will be appropriate to reduce the target range for the federal funds rate until we have gained greater confidence that inflation is moving sustainably toward 2 percent. Incoming data for the first quarter of this year did not support such greater confidence. The most recent inflation readings, however, have shown some modest further progress, and more good data would strengthen our confidence that inflation is moving sustainably toward 2 percent … We continue to make decisions meeting by meeting. We know that reducing policy restraint too soon or too much could stall or even reverse the progress we have seen on inflation. At the same time, in light of the progress made both in lowering inflation and in cooling the labor market over the past two years, elevated inflation is not the only risk we face. Reducing policy restraint too late or too little could unduly weaken economic activity and employment. In considering adjustments to the target range for the federal funds rate, the Committee will continue its practice of carefully assessing incoming data and their implications for the evolving outlook, the balance of risks, and the appropriate path of monetary policy.

There is no bottom line on monetary policy. The only definitive element is that the Fed does not want to adjust the federal funds rate today. Tomorrow or five years from now may be the right time 🙂

The NFIB Small Business Optimism Index reached the highest reading of the year in June at 91.5, a one-point increase from last month. The last time the index was higher was in December of 2023 when it reached 91.9. Even so, this marks the 30^th month below the historical average of 98. Inflation is still the top small business issue, with 21% of owners reporting it as their single most important problem in operating their business, down one point from May. NFIB Chief Economist Bill Dunkelberg stated:

Main Street remains pessimistic about the economy for the balance of the year. Increasing compensation costs has led to higher prices all around. Meanwhile, no relief from inflation is in sight for small business owners as they prepare for the uncertain months ahead.

Here is a summary of headlines we are reading today:

• Early Adopters Pay the Price as EV Truck Values Tumble
• Africa’s Top Oil Producer Aims to Fight Soaring Inflation with Gold Reserves
• Tesla Short Sellers Are Getting Burned
• BP Shares Plummet on $2 Billion Impairment Warning
• Russian Moguls Received $11 Billion in Dividends in the Past Year
• Oil Prices Drop as Hurricane Beryl Blows Over
• Fed Chair Powell says holding rates high for too long could jeopardize economic growth
• Investors poured $1.6 billion into this riskier corner of the bond market in June, State Street says
• Bitcoin rises as Fed Chair Powell outlines risk to keeping rates high too long: CNBC Crypto World
• It suddenly looks like there are too many homes for sale. Here’s why that’s not quite right
• Boeing deliveries drop 27% in June year-on-year
• Hopes for cooling inflation are stifled by Wall Street’s expectations for Trump 2.0
• Long-term Treasury yields rise for first time in five sessions after Powell expresses need for more ‘good’ inflation data

Click on the “Read More” below to access these, other headlines, and the associated news summaries moving the markets today.

Summary Of the Markets Today:

• The Dow closed down 31 points or 0.08%,
• Nasdaq closed up 0.28%, (Closed at 18,404, New Historic high 18,417)
• S&P 500 closed up 0.10%, (Closed at 5,573, New Historic high 5,583)
• Gold $2,367 down $30.80,
• WTI crude oil settled at $82 down $0.94,
• 10-year U.S. Treasury 4.275 up 0.003 points,
• USD index $105.01 up $0.140,
• Bitcoin $56,475 up $621 or 1.11%,

*Stock data, cryptocurrency, and commodity prices at the market closing.

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Click here to read our current Economic Forecast – July 2024 Economic Forecast: One Recession Flag Removed But Little Indication The Economy Is Strengthening

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Today’s Economic Releases Compiled by Steven Hansen, Publisher:

No releases today.

Here is a summary of headlines we are reading today:

• Cold Rolled Stainless Imports Surge Despite Higher Freight Rates
• Raw Material Shortages Weigh on EU Ammunition Production
• Gold’s Potential as a Safe Haven in a Warming World
• Why Adapting to Climate Change Will Be So Expensive
• 2 Million Texans Without Power as Hurricane Beryl Reaches Houston
• Battery Majors Suffer Profit Drop on Lower-Than-Expected EV Sales
• Inflation outrage: Even as prices stabilize, Walmart, Chipotle and others feel the heat from skeptical customers
• Goldman tells clients to buy calls on Wells Fargo ahead of results Friday
• Bitcoin’s slump continues amid government selling pressures, Mt. Gox repayments: CNBC Crypto World
• Stocks & Bonds Sluggish In Post-Holiday Hangover; Black Gold, Bitcoin, & Bullion Battered
• Americans Are Poorer – The US Misery Index Rises Again
• Credit Card Debt Unexpectedly Surges As Card APR Hits New All-Time HIgh
• Treasury yields end mixed with investors focused on inflation, U.S. election

Click on the “Read More” below to access these, other headlines, and the associated news summaries moving the markets today.

Summary Of the Markets Today:

• The Dow closed up 68 points or 0.17%,
• Nasdaq closed up 0.90%, (Closed at 18,353, New Historic high 18,366)
• S&P 500 closed up 0.54%, (Closed at 5,567, New Historic high 5,570)
• Gold $2,399 up $29.20,
• WTI crude oil settled at $83 down $0.75,
• 10-year U.S. Treasury 4.277 down 0.069 points,
• USD index $104.86 down $0.270,
• Bitcoin $56,469 down $567 or 0.99%,
• Baker Hughes Rig Count: U.S. +4 to 585 Canada -1 to 175

*Stock data, cryptocurrency, and commodity prices at the market closing.

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Click here to read our current Economic Forecast – July 2024 Economic Forecast: One Recession Flag Removed But Little Indication The Economy Is Strengthening

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Today’s Economic Releases Compiled by Steven Hansen, Publisher:

Total nonfarm payroll employment increased by 206,000 in June 2024, and the unemployment rate changed little at 4.1 percent, the U.S. Bureau of Labor Statistics reported today. Job gains occurred in government, health care, social assistance, and construction. The household survey (which gives us the unemployment rate) says employment gains were 116,000 whilst the establishment survey (which gives us the headline employment numbers was 206,000. This growing difference between the establishment survey and the household survey this year is significant:

• establishment survey = 1,334,000 year-to-date or 222,000 average growth per month in 2024
• household survey = 16,000 year-to-date or 3,000 average growth per month in 2024

The bottom line is that the establishment survey is saying we have good jobs growth – and the household survey is saying we are close to being in a recession.

And consider that almost three-quarters of the establishment survey’s jobs created this month came from government and healthcare. Is this the type of job growth one would expect from a healthy economy?

NFIB’s June 2024 jobs report found solid employment hiring plans among small business owners, but overall unsuccessful attempts to hire additional workers. A seasonally adjusted 37% of all small business owners reported job openings they could not fill in their current period, down five points from May. NFIB Chief Economist Bill Dunkelberg’s stated:

This summer, small business owners continue to try to hire and find qualified employees for their open positions. The number of small businesses with one or more job openings they can’t fill remains at exceptionally high levels. However, owners are raising compensation at historically high levels to attract and retain employees.

Here is a summary of headlines we are reading today:

• Saudi Crude Oil Exports Slump to 10-Month Low
• U.S. Gas Rig Count Jumps as Oil Rig Count Remains Unchanged
• Why Are Hedge Funds Buying Up Physical Cobalt?
• Beijing Targets EU Pork and Brandy as Tariffs on Chinese EVs Take Effect
• Shell Expects to Book Up to $2 Billion in Writedowns in Q2
• UK Oil Industry on Edge as Labour Wins Election in a Landslide
• Here’s where the jobs are for June — in one chart
• S&P 500, Nasdaq post record closes Friday as jobs report raises Fed rate cut hopes: Live updates
• Bitcoin tanks as Mt. Gox begins repaying creditors: CNBC Crypto World
• Stocks making the biggest moves midday: Macy’s, MicroStrategy, Coinbase, Nvidia and more
• 10-year Treasury yield falls after unemployment rate rises unexpectedly
• Phoenix Police Pull-Over Driverless Waymo For ‘Freaking Out’ & Driving Into Oncoming Traffic
• 2-year Treasury yield ends at lowest since March on signs of deteriorating labor market

Click on the “Read More” below to access these, other headlines, and the associated news summaries moving the markets today.

Summary Of the Markets Today:

• The Dow closed down 24 points or 0.06%,
• Nasdaq closed up 0.88%, (Closed at 18,188, New Historic high 18,188)
• S&P 500 closed up 0.51%, (Closed at 5,537, New Historic high 5,539)
• Gold $2,365 up $31.10,
• WTI crude oil settled at $84 up $0.99,
• 10-year U.S. Treasury 4.354 down 0.081 points,
• USD index $105.35 down $0.37,
• Bitcoin $59,862 down $2,178 or 3.51%,

*Stock data, cryptocurrency, and commodity prices at the market closing.

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Click here to read our current Economic Forecast – July 2024 Economic Forecast: One Recession Flag Removed But Little Indication The Economy Is Strengthening

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Today’s Economic Releases Compiled by Steven Hansen, Publisher:

Private sector employment increased by 150,000 jobs in June 2024 and annual pay was up 4.9% year-over-year, according to the ADP® National Employment Report. I know some are spinning this as a low number – the facts are that 150,000 employment gains supports economic growth; If anything, the ADP numbers are slightly trending up; And overall both ADP and the BLS’s numbers are showing adequate employment growth. Nela Richardson, chief economist, ADP adds:

Job growth has been solid, but not broad-based. Had it not been for a rebound in hiring in leisure and hospitality, June would have been a downbeat month.

U.S.-based employers announced 48,786 cuts in June 2024, down 23.6% from the 63,816 cuts announced one month prior. It is 19.8% higher than the 40,709 cuts announced in the same month in 2023. Andrew Challenger, Senior Vice President and workplace expert for Challenger, Gray & Christmas, Inc. stated:

June is typically a low month for job cut announcements, as most companies are midyear or at the end of their fiscal years. The months following fiscal year ends tend to have a spike in cuts, as those plans are implemented. Over the last decade, job cuts have primarily been announced during the first half of the year. Prior to 2013, major announcements would bookend the year.

The US trade balance was improving until March 2023 but recently the trade balance has been deteriorating. The deficit increased from $74.5 billion in April (revised) to $75.1 billion in May 2024, as exports decreased more than imports. The graph below shows imports are growing much faster than exports.

New orders for manufactured goods in May 2024 was up 0.9% year-over-year (down 0.3% year-over-year inflation adjusted). Manufacturing remained in a recession in May.

In the week ending June 29, the advance figure for seasonally adjusted initial unemployment claims 4-week moving average was 238,500, an increase of 2,250 from the previous week’s revised average. The previous week’s average was revised up by 250 from 236,000 to 236,250.

In June  2024, the Services Purchasing Manager Index registered 48.8%, 5 percentage points lower than May’s figure of 53.8%. The reading in June was a reversal compared to May and the second in contraction territory in the last three months. Before April, the services sector grew for 15 straight months following a composite index reading of 49 percent in December 2022; the last contraction before that was in May 2020 (45.4 percent). The Business Activity Index registered 49.6 percent in June, which is 11.6 percentage points lower than the 61.2 percent recorded in May and the first month of contraction since May 2020. The New Orders Index contracted in June for the first time since December 2022; the figure of 47.3 percent is 6.8 percentage points lower than the May reading of 54.1 percent. The takeaway here is that the services industry entering contraction territory is a recession flag.

The Minutes of the Federal Open Market Committee for June 11–12, 2024 shows significant discussion on inflation and the federal funds rate which pundits want reduced. Highlights of the minutes which I think are significant are detailed below:

In their discussion of inflation developments, participants noted that after a significant decline in inflation during the second half of 2023, the early part of this year had seen a lack of further progress toward the Committee’s 2 percent objective. Participants judged that although inflation remained elevated, there had been modest further progress toward the 2 percent goal in recent months … participants suggested that a number of developments in the product and labor markets supported their judgment that price pressures were diminishing. In particular, a few participants emphasized that nominal wage growth, though still above rates consistent with price stability, had declined, notably in labor-intensive sectors. 

… Participants remarked that demand and supply in the labor market had continued to come into better balance. Participants observed that many labor market indicators pointed to a reduced degree of tightness in labor market conditions. These included a declining job openings rate, a lower quits rate, increases in part-time employment for economic reasons, a lower hiring rate, a further step-down in the ratio of job vacancies to unemployed workers, and a gradual uptick in the unemployment rate.

… Several participants also suggested that the [BLS] establishment survey may have overstated actual job gains. 

… Participants generally observed that continued labor market strength could be consistent with the Committee achieving both its employment and inflation goals, though they noted that some further gradual cooling in the labor market may be required.

… Participants observed that a lower rate of output growth this year could aid the disinflation process while also being consistent with a strong labor market. Participants generally viewed the Committee’s restrictive monetary policy stance as having a restraining effect on growth in consumption and investment spending and as contributing to a gradual slowing in the pace of economic activity. A couple of participants particularly stressed that the Committee’s past policy tightening had contributed to higher rates for home mortgage loans and other longer-term borrowing, which were moderating spending and production, including households’ discretionary purchases and residential construction activity. 

… Some participants highlighted reasons why inflation could remain above 2 percent for longer than expected. These participants pointed to risks that inflation could stay elevated as a result of worsening geopolitical developments, heightened trade tensions, more persistent shelter price inflation, financial conditions that might be or could become insufficiently restrictive, or U.S. fiscal policy becoming more expansionary than expected; the latter two scenarios were also seen as implying upside risks to economic activity.

… In discussing the outlook for monetary policy, participants noted that progress in reducing inflation had been slower this year than they had expected last December. They emphasized that they did not expect that it would be appropriate to lower the target range for the federal funds rate until additional information had emerged to give them greater confidence that inflation was moving sustainably toward the Committee’s 2 percent objective. 

… Some remarked that the continued strength of the economy, as well as other factors, could mean that the longer-run equilibrium interest rate was higher than previously assessed, in which case both the stance of monetary policy and overall financial conditions may be less restrictive than they might appear. A couple of participants noted that the longer-run equilibrium interest rate was a better guide for determining where the federal funds rate may need to move over the longer run than for assessing the restrictiveness of current policy. Participants noted the uncertainty associated with the economic outlook and with how long it would be appropriate to maintain a restrictive policy stance.

Here is a summary of headlines we are reading today:

• Google’s Emissions Have Surged Nearly 50% Due to AI Energy Demand
• Shell Begins Perdido Evacuation As Hurricane Beryl Threatens Operations
• Tech Giants’ Power Needs Could Jeopardize U.S. Grid Reliability
• Oil Prices Rise As EIA Confirms Huge Crude Draw
• Oil Prices Surge as Geopolitical Risk and Crude Demand Both Rise
• Red States Win Legal Battle Against Biden’s LNG Export Restrictions
• New Field Starts Oil Production in U.S. Gulf of Mexico
• Fed says it’s not ready to cut rates until ‘greater confidence’ inflation is moving to 2% goal
• S&P 500, Nasdaq close at fresh records as investors look past soft economic data: Live updates
• 10-year Treasury yield tumbles after weak economic data
• FOMC Minutes Show “Vast Majority” Expect Economy To Cool, See Deflationary Effects Of AI

Click on the “Read More” below to access these, other headlines, and the associated news summaries moving the markets today.