NOAA Updates the ENSO Forecast on May 12, 2022- Chances of a La Nina Three-peat are 61%

On the second Thursday of every month, NOAA issues its analysis of the status of ENSO. This includes determining the Alert System Status. Although the current status remains the same i.e.  La Nina Advisory, the forecast has been adjusted somewhat from last month. The forecast calls for the La Nina to continue.  The timing is shown in the NOAA discussion and the IRI probability analysis. Of importance, the chances of a Triple Dip La Nina are still difficult to predict but seem to be slightly higher than the estimate last month. That would be a real disaster for the Southwest and the West Coast. The NOAA estimate for La Nina lasting into early Winter is 61%. This is a minority opinion in terms of other meteorological agencies almost all of which see La Nina ending sooner.

The impact of the NOAA forecast for the slow or non-existent transition from La Nina to ENSO Neutral will show up next Thursday when NOAA issues its Seasonal Outlook. The NOAA ENSO Status Update provides an advance indication of how the Outlook might change. There is a lag between the ENSO state and the impact on U.S. weather.  Thus the exact strength of the  La Nina may not be very important in terms of the actual impact on Summer weather including the North American Monsoon (NAM).  We may see some changes farther out in the NOAA Outlook that will be issued next Thursday in particular Fall and Winter. Although the chances that this will happen are slightly less this month, the possibility of a Triple Dip should be of considerable concern. It most likely will be reflected in the Outlook issued next Thursday but perhaps not. We will learn more about what NOAA thinks next Thursday.

12May2022 Market Close & Major Financial Headlines: Markets Little Changed With Bears In Control. S&P Down 18% This Year.

Summary Of the Markets Today

  • The Dow closed down 0.3%,
  • Nasdaq closed up 0.1%,
  • S&P 500 closed down 0.1%,
  • WTI crude oil up $1.12 to $106.83,
  • USD $104.81. up 1.0%,
  • Gold down $30.50 to $1,823,
  • Bitcoin down 1.5% to $28,558,
  • 10-year U.S. Treasury down -0.04% to 2.871%

Today’s Economic Releases

For the week ending 07 May 2022, initial unemployment claims continue to modestly increase.

The Producer Price Index’s final demand year-over-year growth modestly declined from 11.5% to 11.0% (similar to the decline seen in the CPI).

A summary of headlines we are reading today:

  • A Global Energy Shortage Is Putting Bitcoin Under Pressure
  • Russia Could Cut Gas Supplies To Finland Tomorrow
  • A Ban On Excessive Gasoline Prices Heading To Congress For Vote
  • Gold And Silver Fall As Rising Interest Rates Dampen Sentiment
  • U.S. airline bookings dropped 17% in April as flights got even more expensive
  • Secret Royalty Checks To Fauci, Hundreds Of NIH Scientists

These and other headlines and news summaries moving the markets today are included below.

11May2022 Market Close & Major Financial Headlines: Wall Street Falls In Volatile Trading After Hot Inflation Report Of 8.3%, Cryptos Continue To Slip, Investors Fear Of An Economic Slowdown Accelerates

Summary Of the Markets Today

  • The Dow closed down 1.02% -327,
  • Nasdaq closed down 3.18%,
  • S&P 500 closed down 1.65%,
  • WTI crude oil settled at 105.33, up 6.03%
  • USD $103. up 0.02%
  • Gold 1854, up 0.02%,
  • Bitcoin down 2.5% to $29,113,
  • 10-year U.S. Treasury down -0.07% / 2.923%

Today’s Economic Releases

The Consumer Price Index (CPI) for April 2022 shows year-over-year inflation moderated from 8.5% to 8.3%.

A summary of headlines we are reading today:

  • Kyiv Halts Russian Gas Shipments Through Key Hub
  • Southwest is upgrading its planes with faster Wi-Fi, bigger overhead bins and new drinks to woo travelers
  • Toyota warns ‘unprecedented’ raw materials costs could cut profits by 20%
  • Major Trucking Firms Prepare For “Imminent Diesel Shortage In Eastern Half Of US”
  • Does the cryptocurrency crash pose a threat to the financial system?
  • Market Extra: What’s next for markets after inflation data fails to deliver ‘watershed moment’

These and other headlines and news summaries moving the markets today are included below.

10May2022 Market Close & Major Financial Headlines: Markets Closed Mixed After Attempting A Comeback By Gapping Up At The Opening Bell, Major Indexes Lose Steam As Inflation And Recession Fears Continue

Summary Of the Markets Today

  • The Dow closed down 0.26%,
  • Nasdaq closed up 0.98%,
  • S&P 500 closed up 0.25%,
  • WTI crude oil settled at 99.69, down 2.7%
  • USD $103.09 up 0.14%
  • Gold $1836, down $20,
  • Bitcoin down 0.73% to $31,381,
  • 10-year U.S. Treasury down -0.086% / 2.993%

Today’s Economic Releases

The NFIB Small Business Optimism Index was unchanged in April. The expectation index (optimism 6 months from today) associated with this survey sank to the lowest level recorded in this index. Inflation remains a major concern.

CoreLogic Loan Performance Insights, which monitors mortgage delinquency, improved in February 2022.

A summary of headlines we are reading today:

  • Fears Of An Economic Slowdown Drag Oil Prices Lower
  • Boeing aircraft orders, deliveries slipped in April
  • Virgin Orbit is assembling a fleet of 747 jets to launch more rockets into space
  • Fed Warns Of Negative Feedback Loop, Fragile Liquidity, And More Volatile Prices
  • Market Extra: Here are 4 reasons why market volatility is unlikely to soon subside

These and other headlines and news summaries moving the markets today are included below.

09May2022 Market Close & Major Financial Headlines: Wall Street Continues To Sell Off, Sharp Downturn In Last 15 Minutes, Dow Tumbles, S&P 500 Slides To 13-Month Low

Summary Of the Markets Today

  • The Dow down 1.99% or 654 points
  • Nasdaq down 3.20%,
  • S&P 500 down 4.29%,
  • WTI crude oil down $7.81 to 102.72
  • gold down from $1953 on Apr22 to $1853,
  • Bitcoin down 21% over the past 5 days to $31,321,
  • 10-year U.S. Treasury down -0.086% to 3.038%

Today’s Economic Releases

Fed Bostic Speech – The Federal Reserve raised the target for the fed funds rate by half a point to 0.75%-1% during its May 2022 meeting, the second consecutive rate hike and the biggest rise in borrowing costs since 2000, aiming to tackle soaring inflation. The central bank added that ongoing increases in the target range will be appropriate, with Chair Powell pointing to 50bps hikes in the next couple of meetings. The Fed will also begin reducing asset holdings on its $9 trillion balance sheet on June 1st. The plan will start with a monthly roll-off of $30 billion of Treasuries and $17.5 billion on mortgage-backed securities for 3 months and will then increase to $60 billion and $35 billion for mortgages per month. On the economic front, policymakers noted that the invasion of Ukraine and related events are creating additional upward pressure on inflation and are likely to weigh on economic activity. In addition, COVID-related lockdowns in China are likely to exacerbate supply chain disruptions. source: Federal Reserve

Wholesale Inventories – The headlines say wholesale sales were up month-over-month. Year-over-year change in the inventory-to-sales ratio is what is important. A jump in the ratio could indicate a slowing economy (one month of data is not a trend). A flat trend would indicate an economy that was neither accelerating or decelerating. A decelerating trend would indicate an improving economy. Wholesale sales, therefore, are indicating an improving economy.

A summary of headlines we are reading today:

  • Gasoline Prices May Have Finally Peaked
  • Stocks making the biggest moves midday: Palantir, Rivian, Uber and more
  • Bitcoin drops below $30,000 to hit its lowest level since July 2021 after stock sell-off
  • Retail Is Puking: “This Is The 5th Biggest Sell Day On Record”
  • US faces baby formula ‘crisis’ as shortage worsens
  • Mark Cuban: ‘Crypto is going through the lull that the internet went through’
  • Yellen says financial system working well despite ‘potential for continued volatility’

These and other headlines and news summaries moving the markets today are included below.

06May2022 Market Close & Major Financial Headlines: Stocks Continue Longest Losing Streak In 10 Years, 10 Year Treasury At 3 Year+ High

Summary Of the Markets Today

  • The Dow down 0.3%,
  • Nasdaq down 1.4%,
  • S&P 500 down 0.6%,
  • WTI crude oil up $2.32 to $110.56,
  • Gold up $7.40 to $1,883,
  • Bitcoin down 1.7% to $35,902,
  • 10-year U.S. Treasury up 6 basis points to 3.13%

Today’s Economic Releases

A summary of today’s April 2022 employment report:

  • total non-farm employment rose 428,000, total private up 406,000, and the unemployment rate remained at 3.6%
  • the household survey, on the other hand, showed a decline of employment of 363,000 (the unemployment rate comes from the household survey whilst the headline employment numbers come from the establishment survey.
  • the U-6 total unemployment rate rose from 6.9% to 7.0%
  • largest jobs growth this month came from accommodation and food services (66.1K), health care and social assistance (40.9K), transport and warehousing (52.0K), and manufacturing (55.0K).

Consumer Credit increased at a seasonally adjusted rate of 9.7% month-over-month in 1Q2022.

Here are the top 10 boys and girls names for 2021 according to U.S. Social Security:

Boys Girls
1. Liam 1. Olivia
2. Noah 2. Emma
3. Oliver 3. Charlotte
4. Elijah 4. Amelia
5. James 5. Ava
6. William 6. Sophia
7. Benjamin 7. Isabella
8. Lucas 8. Mia
9. Henry 9. Evelyn
10. Theodore 10. Harper

Other Economic News

As usual, we have included below the headlines and news summaries moving the markets today including:

  • Oil Markets Are Bracing For Further Supply Disruptions
  • Shocking Consumer Credit Numbers: Everyone Is Maxing Out Their Credit Card Ahead Of The Recession
  • Used-car prices are down from record highs, easing the impact of inflation
  • Stocks Suffer Longest Losing Streak In 10 Years, Long-Bond Battered As Fed-Cred Crumbles
  • Nationwide Baby Formula Shortage Hits “Shocking” Levels, Sparking Panic Among Parents
  • Nifty50 weekly chart signals more weakness ahead
  • 10-year Treasury yield trades at nearly 3 1/2-year high as inflation outlook remains in focus after April jobs data

05May2022 Market Close & Major Financial Headlines: A Down Day Erasing Yesterday’s Gains

Some say today’s market’s decline is due to fear of a 75 basis-point hike at the Fed’s June meeting.

Summary Of the Markets Today

  • The Dow down 3.2%,
  • Nasdaq down 5.0%,
  • S&P 500 down 3.6%,
  • WTI crude oil up $0.51 to $108.26,
  • gold up $9.90 to $1,879,
  • Bitcoin down 8.8% to $36,183,
  • 10-year U.S. Treasury up 12 basis points to 3.04%

Today’s Economic Releases

Employers increased job cuts by 14% in April 2022 compared to March – although job cuts to date for the year are down 52% from the same period last year.

First quarter 2022 non-farm business labor productivity declined 0.6% year-over-year whilst unit labor costs increased 7.2% YoY. Note that productivity is measured using monetary methods and is not adjusted for inflation. Having said this, I believe labor productivity likely improved – but not nearly as much as labor costs grew.

Weekly unemployment claims are modestly growing – but still well below levels seen in the last year.

Other Economic News

As usual, we have included below the headlines and news summaries moving the markets today including:

  • Finland Braces For Russian Gas Cut-Off Ahead Of NATO Decision
  • Germany Will Have First LNG Import Capacity By Years End
  • Rising interest rates mean higher loan costs when you go to buy a car. Monthly payments already average $650
  • Main Street is convinced that a recession will hit the U.S. economy this year
  • Is now a good time to buy a home? Most Americans don’t think so — and Gallup says it’s the first time more than 50% of people feel that way
  • Is now a good time to buy a home? Most Americans don’t think so — and Gallup says it’s the first time more than 50% of people feel that way

04May2022 Market Close & Major Financial Headlines: Markets Up For The Third Day In A Row

Summary Of the Markets Today

  • The Dow up 3.8%,
  • Nasdaq up 3.2%,
  • S&P 500 up 3.0%,
  • WTI crude oil up $5.60 to $107.95,
  • gold up $15.30 to $1,886,
  • Bitcoin up 5.5% to $39,777,
  • 10-year U.S. Treasury down 4 basis points to 2.92%

Today’s Economic Releases

The BEA announced today that March 2022 imports grew month-to-month 10.3%, exports grew 5.6% – and the resulting trade deficit grew 22.3%

As expected, the Federal Reserve raised the federal funds rate by 1/2 percent with the target range now 3/4% to 1%. And their statement stated:

…and anticipates that ongoing increases in the target range will be appropriate. In addition, the Committee decided to begin reducing its holdings of Treasury securities and agency debt and agency mortgage-backed securities on June 1, as described in the Plans for Reducing the Size of the Federal Reserve’s Balance Sheet that were issued in conjunction with this statement.

In addition, the Federal Reserve issued a plan for reducing the size of their balance sheet.

Other Economic News

As usual, we have included below the headlines and news summaries moving the markets today including:

  • Diesel Prices Hit New Record On Wednesday
  • Oil Prices Hit $110 As Europe Prepares To Ban Russian Crude
  • Oil Prices Hit $110 As Europe Prepares To Ban Russian Crude
  • Here’s what changed in the new Fed statement
  • US makes biggest interest rate rise in 22 years
  • Amazon, Citigroup, Yelp, to help pay for workers’ abortion travel costs