Summary Of the Markets Today:

• The Dow closed up 429 points or 1.26%,
• Nasdaq closed up 1.15%,
• S&P 500 closed up 1.22%,
• Gold $1,971 up $1.70,
• WTI crude oil settled at $71 up $2.31,
• 10-year U.S. Treasury 3.717% down 0.008 points,
• USD Index $102.11 down $0.83,
• Bitcoin $25,456 down $271,

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

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Click here to read our Economic Forecast for June 2023

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

Industrial production continues with literally no growth (0.2% year-over-year) in May 2023. In May, the index for manufacturing was down 0.3% year-over-year, while the indexes for mining and utilities were 5.0% and -3.8% year-over-year, respectively. Capacity utilization moved down to 79.6 percent in May, a rate that is 0.1 percentage points below its long-run (1972–2022) average. This is weak data.

Advance estimates of U.S. retail and food services sales for May 2023 were up 2.8% year-over-year (0.6% inflation-adjusted). However, consider most of the “weakness” in sales is now coming from the decline in fuel prices. I consider this a relatively stronger report than last month, and does not have the stench of recession.

Import prices have fallen 5.9% year-over-year whilst export prices have fallen 10.1%. Import prices affect consumer prices – but the primary reason for import price decline is fuel imports.

The Philadelphia Fed Manufacturing Survey declined from -10.4 last month to -13.7 in June 2023, its 10th consecutive negative reading. The sub-index for new orders declined. Manufacturing appears to be in a recession.

In the week ending June 10, the advance figure for seasonally adjusted initial unemployment claims 4-week moving average was 246,750, an increase of 9,250 from the previous week’s revised average. This is the highest level for this average since November 20, 2021, when it was 249,250. The previous week’s average was revised up by 250 from 237,250 to 237,500.

 

Here is a summary of headlines we are reading today:

• European Central Bank Hikes Rates To 22-year High
• Heatwaves Are Sending Demand For Fossil Fuels Soaring
• Aluminum Prices Flatline As LME Grapples With Russian Inventory
• Scientists Leap Forward In Sustainable Hydrogen Production
• New Truck Orders Defy Troubled Freight Market
• Mediterranean restaurant chain Cava stock soars as much as 117% in market debut
• S&P 500, Nasdaq rally for sixth straight day as traders hope Fed’s rate-hiking cycle is nearly over: Live updates
• The market isn’t buying the Fed’s tough talk on interest rates
• Bitcoin sinks below $25,000, and U.S. withdraws new charges in SBF case for now: CNBC Crypto World
• American F-22 Fighter Jets Deployed To Middle East Amid Russian Aircraft Activity
• Market Snapshot: Dow jumps nearly 450 points as S&P 500, Nasdaq hit fresh 14-month highs despite hawkish Fed and ECB

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 233 points or 0.68%,
• Nasdaq closed up 0.39%,
• S&P 500 closed up 0.08%,
• Gold $1,960 up $1.00,
• WTI crude oil settled at $69 down $0.72,
• 10-year U.S. Treasury 3.800% down 0.041 points,
• USD Index $103.06 down $0.28,
• Bitcoin $25,853 up $21,

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

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Click here to read our Economic Forecast for June 2023

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

The Federal Reserve did what the market expected holding the federal funds rate steady stating in part:

…  the Committee decided to maintain the target range for the federal funds rate at 5 to 5-1/4 percent. Holding the target range steady at this meeting allows the Committee to assess additional information and its implications for monetary policy. In determining the extent of additional policy firming that may be appropriate to return inflation to 2 percent over time, the Committee will take into account the cumulative tightening of monetary policy, the lags with which monetary policy affects economic activity and inflation, and economic and financial developments.

Their forward-looking words on what happens next:

;;; In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook. The Committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals. The Committee’s assessments will take into account a wide range of information, including readings on labor market conditions, inflation pressures and inflation expectations, and financial and international developments.

The bottom line is that this statement really gives you no clues on the future of the federal funds rate. However, Fed Chair Powell’s press conference did indicate future rate hikes as well as well as dot-plots which show 2 more increases. Further, Chair Powell said he doesn’t see a rate cut until inflation comes down meaningfully and significantly, and that can take a couple of years.

Inflation seems to have been tamed as the producer price index (PPI) has fallen from 2.3% in April to 1.1% in May 2023. The PPI less foods and energy declined from 3.3% to 2.8% in May.

 

Here is a summary of headlines we are reading today:

• Rystad Sees Major Jump In Battery Storage Capacity Through 2030
• Polysilicon Price Surge: A Challenge For Emerging Solar Markets
• Oil Moves Lower After EIA Confirms Large Crude Build
• JP Morgan Slashes Oil Price Forecast To $81 This Year
• Shell To Raise Dividend By 15% As It Doubles Down On Oil And Gas
• Fed recap: Breaking down the market’s reaction to the Fed’s pause and all of Powell’s key comments
• S&P 500 closes little changed after Fed leaves rates unchanged, signals more hikes are coming: Live updates
• Treasury yields waver as traders weigh latest Fed decision and potential moves going forward
• Stocks & Gold Slump After Hawkish Fed Sends Rate-Hike Odds Soaring
• The Fed: Fed skips June interest-rate hike, but points to two more increases this year
• Futures Movers: Oil settles lower as an ‘adjustment’ contributes to a nearly 8 million-barrel weekly U.S. crude supply climb

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 146 points or 0.43%,
• Nasdaq closed up 0.83%,
• S&P 500 closed up 0.69%,
• Gold $1,956 down $13.40,
• WTI crude oil settled at $69 up $2.06,
• 10-year U.S. Treasury 3.829% up 0.064 points,
• USD Index $103.31 down $0.34,
• Bitcoin $25,874 up $54,

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

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Click here to read our Economic Forecast for June 2023

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

Pundits believe the Federal Reserve will pass on raising the federal funds rate tomorrow because year-over-year inflation has now fallen to 4.0% year-over-year (blue line on the graph below) according to today’s consumer price index for All Urban Consumers (CPI-U) data for May 2023. Note that the CPI-U less food and energy index rose 5.3% year-over-year (red line on the graph below). Actually, food is up 6.7% year-over-year – and it is energy (think gas and oils) which is DOWN 11.7% year-over-year. It is energy driving the decline in the CPI, and this pundit would keep raising the federal funds rate (green boxed line on the graph below) until a sizeable decline in the CPI-U less food and energy is observed. The Fed believes there is a lag between raising rates and the effect on inflation of raising those rates – there is a lag but not a significant one when labor compensation is rising at a fast clip also. CoreLogic Chief Economist Selma Hepp added:

While the Fed is unlikely to steer away from the communicated path and will most likely keep the rates steady on Wednesday, Tuesday’s CPI report suggests that inflation pressures persist and the Fed will consider another hike next month. The likelihood of another hike or two has also increased given lack of credit crunch the Fed was expecting from the banking sector. As a result, mortgage rates, while still on a gradual decline, are likely to remain higher through the remainder of year.

The NFIB Small Business Optimism Index increased 0.4 points in May to 89.4, which is the 17^th consecutive month below the 49-year average of 98. The last time the Index was at or above the average was in December 2021. Small business owners expecting better business conditions over the next six months declined one point from April to a net negative 50%. Twenty-five percent of owners reported that inflation was their single most important problem in operating their business, up two points from last month and followed by labor quality at 24%. Bill Dunkelberg, NFIB Chief Economist stated:

Overall, small business owners are expressing concerns for future business conditions. Supply chain disruptions and labor shortages will continue to limit the ability of many small firms to meet the demand for their products and services, while less severe than last year’s experience.

 

Here is a summary of headlines we are reading today:

• China At The Forefront Of Nuclear Weapon Expansion
• May Inflation Comes In Lower Than Expected
• Oil Markets On Edge Ahead Of Fed Meeting
• Oil Soars Nearly 4% Ahead Of Fed Rate Decision
• Pay rise surprise leads to forecasts of higher interest rates
• Mortgages: New squeeze on landlords will hit renters too
• Ahead of Market: 10 things that will decide D-Street action on Wednesday
• Should you be worried if your crypto is in Binance.US or Coinbase?
• NerdWallet: ‘What if I live too long?’ Five things to know about taking Social Security at 62.

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