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Post by thelivyjr » Tue Feb 23, 2021 1:40 p


"Oil Prices Show Slight Changes"

by Bloomberg | Andres Guerra Luz & Alex Longley

Tuesday, February 23, 2021

(Bloomberg) -- Oil dipped in New York as technical indicators signal prices are due for a pullback following a strong rally this month.

The market is pricing in a strong short-term deficit, according to oil trader Vitol Group.

But uncertainty remains over when demand will come back in force, and U.S. production is resuming in Texas after the cold snap.

Crude is still lingering in overbought territory after a 18% jump so far this month.

“After a $2 rally yesterday,” it was hard to sustain further gains, said Peter McNally, global head for industrials, materials and energy at Third Bridge.

Still, “if the combination of seasonal demand, vaccine rollouts and ongoing supply constraints all conspire, it looks like inventories will continue to decline.”

Bank of America joined others in boosting its Brent price outlook for 2021, expecting a ceiling price of $70 a barrel amid tightening supplies.

Money is flooding into the space, with the aggregate open interest on Brent futures hitting a fresh record high.

Meanwhile, Saudi Arabia and Russia will once again head into an OPEC+ meeting with differing opinions about adding more crude to the market, potentially pressuring the recent rally.

Riyadh is calling for caution while Moscow appears to favor a supply hike.

The group will meet March 4 to discuss whether to provide more crude to the market in April.

“It’s unmistakable that we’ll see some increase, but how much we get” is still uncertain, said Bill O’Grady, executive vice president at Confluence Investment Management in St. Louis.

“The Saudis like this price level a lot, because it’s high enough where they generate good levels of income but low enough to where they don’t anticipate a huge pickup in U.S. production.”


West Texas Intermediate for April edged 3 cents lower to settle at $61.67 a barrel.

Brent for April settlement gained 13 cents to end the session at $65.37 a barrel.

U.S. crude inventories likely fell last week amid the polar blast, according to a Bloomberg survey.

The industry-funded American Petroleum Institute will report its figures later Tuesday ahead of U.S. government data on Wednesday.

However, crude production from the Texas portion of the Permian Basin has rebounded significantly to around 2.9 million barrels a day, from just 600,000 to 700,000 exactly a week ago, according to Bert Gilbert, head of North American business development at oil-data analytics startup OilX.

Typically, the area produces roughly 3.5 million barrels a day.

“This recovery is largely due to a return of electricity to the region,” Gilbert said.

Other energy infrastructure impacted by the U.S. deep freeze is also in the process of restarting.

Plains All American Pipeline LP plans to restore normal operations at 16 oil pipelines after notifying users last week of a force majeure, according to a person familiar with the matter, while at least eight refineries in Texas were trying to restart as of early Tuesday, with varying degrees of success.

Other oil-market news:

Apollo Global Management Inc. and Global Infrastructure Partners are among suitors that bid for a roughly $10 billion stake in Saudi Aramco’s oil pipelines, people familiar with the matter said.

U.S. shale explorers lost hundreds of millions of dollars in oil production from last week’s historic freeze that crippled Texas and left millions without power or water for days.

California is beginning to feel the ripples of oil refinery shutdowns in Texas, with gasoline prices rising faster in the Golden State since a deep freeze crippled fuel-making plants on the Gulf Coast.

--With assistance from Sheela Tobben. ... 1-article/

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Post by thelivyjr » Tue Feb 23, 2021 1:40 p


"WTI Climbs Above $61 As Crude Stocks Dwindle"

By Julianne Geiger

Feb 17, 2021, 3:42 PM CST

The American Petroleum Institute (API) reported on Tuesday a draw in crude oil inventories of 5.8 million barrels for the week ending February 12.

Analysts had predicted an inventory draw of 2.429 million barrels for the week.

In the previous week, the API reported a draw in oil inventories of 3.500-million barrels after analysts had predicted a build of 985,000 barrels.

Oil prices were trading up on Tuesday ahead of the data release, supported by the shock of freezing temperatures across parts of the United States, including Texas, which caused production outages through a fair amount of oil country.

At 3:17 p.m. EDT, before Tuesday's data release, WTI had risen by $1.15 on the day (+1.92%) to $61.20 — almost a $3 increase over this time last week.

The Brent crude benchmark had risen on the day $1.07 at that time (+1.69%) to $64.41 — also up nearly $3 on the week.

U.S. oil production ticked up 100,000 barrels per day to 11 million bpd, according to the Energy Information Administration.

The API reported a build in gasoline inventories of 3.9 million barrels for the week ending February 12 — after the previous week's 4.810-million-barrel build.

Analysts had expected a 1.397-million-barrel build for the week.

Distillate stocks saw a decrease of 3.500 million barrels for the week, after last week's 487,000-barrel decrease.

Cushing inventories fell by 3.00 million barrels.

Last week, inventories held in Cushing decreased by 1.378 million barrels.

“As of Tuesday’s measure, Enbridge stocks have dropped over 2 million bbl since Friday 5th February,” Dan Schnurr, co-founder of Geospatial Insight, told Oilprice.

Post data release, at 4:40 p.m. EDT, the WTI benchmark was trading at $61.25, while Brent crude was trading at $64.45.

By Julianne Geiger for Oilprice.ocm ... indle.html

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Post by thelivyjr » Tue Feb 23, 2021 1:40 p


"Powell says inflation is still ‘soft’ and the Fed is committed to current policy"

Jeff Cox @jeff.cox.7528 @JeffCoxCNBCcom

Published Tue, Feb 23 2021

Key Points

* Fed Chairman Jerome Powell characterized inflation as “soft” for the most part and said the employment picture still needs help.

* The pandemic has “left a significant imprint on inflation” and it price pressures are not a threat now, he told the Senate Banking Committee.

Inflation and employment remain well below the Federal Reserve’s goals, meaning easy monetary policy is likely to stay in place, central bank Chairman Jerome Powell said Tuesday.

Despite a sharp rise this year in bond yields that has accompanied heightened concern over inflation, Powell said price pressures remain mostly muted and the economic outlook is still “highly uncertain.”

“The economy is a long way from our employment and inflation goals, and it is likely to take some time for substantial further progress to be achieved,” the Fed chief said in prepared remarks for the Senate Banking Committee.

He added that the Fed is “committed to using our full range of tools to support the economy and to help ensure that the recovery from this difficult period will be as robust as possible.”

However, Powell’s statement did not mention the market’s most pressing concern: the jump in 2021 of longer-duration government bond yields to levels not seen since before the Covid-19 pandemic.

The 30-year bond, for instance, is up more than half a percentage point and the benchmark 10-year yield has risen 44 basis points.

Powell noted that the pandemic “has also left a significant imprint on inflation” and on balance it is not a threat to the economy.

“Following large declines in the spring, consumer prices partially rebounded over the rest of last year."

"However, for some of the sectors that have been most adversely affected by the pandemic, prices remain particularly soft,” he said.

“Overall, on a 12-month basis, inflation remains below our 2% longer-run objective.”

The Fed last year revised its approach to inflation.

In the past, it would levy preventive rate hikes when it saw unemployment drop, thinking that a stronger job market would push up prices.

Now, it has adopted an approach in which it will allow inflation to average above 2% for a period of time before moving to tighten policy.

“This change means that we will not tighten monetary policy solely in response to a strong labor market,” Powell said.

Markets pared losses after the release of Powell’s remarks though major averages remained negative across the board.

Treasury yields briefly rose then fell back and were little changed on the session.

“Mr. Powell presumably wants to try to persuade markets that a strengthening economy does not necessarily mean that rates have to rise."

"Good luck with that when the post-Covid surge in activity [becomes] clear,” wrote Ian Shepherdson, chief economist at Pantheon Macroeconomics.

‘Improved outlook’ ahead

As for the rest of his economic assessment, Powell was cautious, saying that even while gains have remained “uneven and far from complete,” the recent drop in coronavirus cases and the continued rollout of vaccines is offering hope.

“While we should not underestimate the challenges we currently face, developments point to an improved outlook for later this year."

"In particular, ongoing progress in vaccinations should help speed the return to normal activities,” he said.

“In the meantime, we should continue to follow the advice of health experts to observe social-distancing measures and wear masks.”

Consumer behavior also presents a dichotomy, with spending on goods strong, as evidenced by blockbuster January retail sales, but spending on services still weak while many bars, restaurants and hotels across the country operate at limited capacity.

Powell also noted disparities in employment gains, saying that Blacks, Hispanics and other minorities are still struggling even as the unemployment rate has fallen from a pandemic high of 14.8% to the current 6.3%.

He also noted that the housing sector “has more than fully recovered from the downturn, while business investment and manufacturing production have also picked up.”

Aggressive policy from both the Fed and Congress were big factors in the recovery, Powell added.

Data also provided by Reuters ... tance.html

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Post by thelivyjr » Tue Feb 23, 2021 1:40 p


"Treasury yields mixed after Fed Chair Powell says inflation is still ‘soft’"

Jesse Pound @jesserpound Vicky McKeever @vmckeevercnbc

Published Tue, Feb 23 2021

Key Points

* Federal Reserve Chairman Jerome Powell spoke to the Senate Banking Committee on Tuesday.

* Powell’s speeches this week will likely be closely watched for how he views the recent run-up in bond yields and for any comments on inflation.

U.S. Treasury yields struggled to find a direction on Tuesday after Fed Chair Jerome Powell indicated that the central bank was not moving toward changing its dovish policy stance.

The yield on the benchmark 10-year Treasury note fell to 1.353%, while the yield on the 30-year Treasury bond climbed to 2.19%.

Yields move inversely to prices.

Powell began his hearing with Senators at 10 a.m. ET.

While the semiannual testimonies are normally nonevents for the market, Powell’s speeches this week will likely be closely watched for how he views the recent run-up in bond yields and for any comments on inflation.

The Fed chief said in prepared testimony that ”“The economy is a long way from our employment and inflation goals, and it is likely to take some time for substantial further progress to be achieved.”

Yields traded higher briefly after the remarks were released before settling back near the flat line as Powell’s hearing continued.

Additionally, December data for the S&P CoreLogic Case-Schiller home price index showed the biggest price gain since 2013.

Auctions were held Tuesday for $34 billion of 52-week bills, $30 billion of 42-day bills and $60 billion of 2-year notes.

— CNBC’s Jeff Cox contributed to this report.

Data also provided by Reuters ... imony.html

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Post by thelivyjr » Wed Feb 24, 2021 1:40 p


"December home prices rose 10.4%, the biggest gain in 7 years, Case-Shiller says"

Diana Olick @in/dianaolick @DianaOlickCNBC @DianaOlick

Published Tue, Feb 23 2021

Key Points

* The 10-city composite annual increase was 9.8%, up from 8.9% in November.

* The 20-city composite posted a 10.1% gain, up from 9.2% in the previous month.

* Phoenix, Seattle, and San Diego continued to show the strongest price gains among the 19 cities surveyed.

December is usually the slowest month for the housing market, but price gains didn’t slow down one bit in 2020.

In fact, they rose at the fastest pace in seven years.

Home prices nationally increased 10.4% compared with December 2019, according to the S&P CoreLogic Case-Shiller Home Price Indices.

That is the strongest annual growth rate in over six years, and a significantly stronger gain than in November, when prices were up 9.5%.

It also ranks as one of the largest annual gains in the more than 30-year history of the index.

The 10-city composite annual increase was 9.8%, up from 8.9% in November.

The 20-city composite posted a 10.1% gain, up from 9.2% in the previous month.

Detroit was excluded, due to Covid-related data collection issues.

“2020′s 10.4% gain marks the best performance of housing prices in a calendar year since 2013,” said Craig Lazzara, managing director and global head of index investment strategy at S&P Dow Jones Indices.

“From the perspective of more than 30 years of S&P CoreLogic Case-Shiller data, December’s year-over-year change ranks within the top decile of all reports.”

Phoenix, Seattle, and San Diego continued to show the strongest price gains among the 19 cities surveyed.

Year-over-year prices in Phoenix rose 14.4%.

In Seattle, they rose 13.6% and San Diego saw a 13% increase.

Eighteen of the 19 cities reported higher price increases in the 12 months ending December 2020 versus the 12 months ending November 2020.

“These data are consistent with the view that Covid has encouraged potential buyers to move from urban apartments to suburban homes."

"This may indicate a secular shift in housing demand, or may simply represent an acceleration of moves that would have taken place over the next several years anyway,” Lazzara said.

Home prices began to see big gains last summer as Covid-driven demand from the stay-at-home culture descended on the housing market.

Record low supply combined with record low mortgage rates caused bidding wars on homes across the nation.

Mortgage rates turned sharply higher last week, which will cut into affordability heading into the 2021 spring market.

Prices generally lag sales, so if sales do suffer, the market is is unlikely to see significant cooling of prices for several months.

Data also provided by Reuters ... se-9-.html

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Post by thelivyjr » Wed Feb 24, 2021 1:40 p


"Is Fed Chair Powell 'cool' with more fiscal aid? Suddenly he won't say"

By Ann Saphir

February 23, 2021

(Reuters) - With a heated political debate underway over the Biden administration’s $1.9 trillion proposed pandemic relief package, it was entirely predictable that U.S. lawmakers would jump at the chance to ask Federal Reserve Chair Jerome Powell to weigh in.

But in contrast with his repeated calls last year for additional fiscal support and the dire consequences of skipping it, Powell declined to do so on Tuesday during the first of two days of congressional testimony.

“I have consistently not taken a position on this bill,” Powell told Republican Senator John Kennedy.

“It’s not appropriate for the Fed to be playing a role in these fiscal discussions about particular provisions and particular’s not our role.”

Kennedy pressed: “If we don’t pass the bill, you’re cool with that?”

“That would be expressing an opinion."

"So that’s what I’m not doing, is expressing an opinion,” Powell answered, a response reminiscent of the kind of cryptic volley offered up by former Fed Chair Alan Greenspan during congressional testimony.

“By being either cool or uncool, I would have to be expressing an opinion.”

It was unclear if Powell’s studied objectivity on the issue reflected any change of heart on the issue.

The economy, he said several times, is a “long way” from health and needs further support.

“I would interpret it as a simple reaction to the fact that a big package is on the way,” says Julia Coronado, president of analysis firm Macropolicy Perspectives.

Indeed, she said, Powell’s forecast Tuesday that the U.S. economy may grow in the range of 6% this year “100%” means he is already penciling in the additional fiscal aid.

The U.S. House of Representatives Budget Committee on Monday approved the relief package, advancing it toward a full House vote in coming days and, eventually, toward consideration in the Senate, where Democrats hold a slim majority.

Last year, as Congress and the Trump administration repeatedly failed to move forward on fiscal relief, Powell struck a decidedly different tone.

In October, for instance, Powell told a group of business economists that “the recovery will be stronger and move faster if monetary policy and fiscal policy continue to work side by side to provide support to the economy until it is clearly out of the woods.”

And in December, as lawmakers appeared close to what ultimately was a $892 billion aid package, Powell went further. “The case for fiscal policy right now is, is very, very strong,” he said in a news conference.

While the details are “up to Congress,” he said, the need for households and businesses to have fiscal support is “widely understood.”

“I certainly would welcome the work that Congress is doing right now,” he said then.

On Tuesday, however, Powell declined more than once to comment on the current bill.

But he did make it clear that if the government does choose to deliver a “burst” of fiscal support, he would not expect to see a surge in unwanted inflation.

The second half of the year is likely to be “very good” and stronger consumer spending could push up prices, he said - but he would expect that effect to be neither large nor persistent.

Reporting by Ann Saphir; Editing by Dan Burns and Andrea Ricci ... SL1N2KT2F9

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Post by thelivyjr » Wed Feb 24, 2021 1:40 p


"TREASURIES-Benchmark yield dips after Fed's Powell says economy still needs support"

By Ross Kerber

February 23, 2021

Feb 23 (Reuters) - The benchmark 10-year U.S. Treasury yield fell on Tuesday after Federal Reserve Chairman Jerome Powell said the economy still needed central bank support.

The 10-year note was down 1.4 basis point at 1.3551% in afternoon trading.

It touched a high of 1.389% early Tuesday before Powell testified at a U.S. Senate Banking Committee hearing in Washington.

Powell said interest rates would remain low and the Fed's bond purchases would continue "at least at the current pace until we make substantial further progress towards our goals ... which we have not really been making."

Analysts said the market's move showed that Powell's remarks reinforced status quo expectations, that the Fed remains dovish despite some inflation concerns.

"His basic stance was the same and it provided some reassurance to the bond market," said Julia Coronado, president of analysis firm Macropolicy Perspectives.

"In Powell's even-keeled way he said, 'Our job is far from over.'"

"'We're going to be here buying Treasuries for some time.'"

Expectations of a consumer price uptick have significantly boosted yields on longer-term U.S. debt since the summer.

Shortly before Powell's testimony, the 30-year bond yield hit 2.34%, the highest since early January 2020.

It was still up 1.3 basis points at 2.1927% on Tuesday afternoon, reflecting investors' longer-term inflation expectations.

A $60 billion U.S. Treasury auction of 2-year notes was "uneventful" according to a note from BMO Capital Markets rates strategist Ben Jeffery.

It had a high yield of 0.119%, the lowest on record, and a bid-to-cover ratio of 2.44 versus an average of 2.57.

The Nasdaq composite index fell in volatile trading as investors sold off mega-cap growth stocks on valuation concerns.

A closely watched part of the U.S. Treasury yield curve measuring the gap between yields on two- and 10-year Treasury notes, seen as an indicator of economic expectations, was at 124 basis points, about a basis point below Monday's close.

The yield on the 30-year Treasury Inflation Protected Securities inched further into positive territory before Powell spoke, reaching 0.093%, its highest since June, before settling to 0.061%, down sightly from late Monday.

But in 10-year TIPS, real rates went more deeply negative to -0.827%.

The two-year U.S. Treasury yield, which typically moves in step with interest rate expectations, was little changed at 0.1169%. ... SL1N2KT3AF

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Post by thelivyjr » Wed Feb 24, 2021 1:40 p


"Powell says economy still needs Fed support, pushes back on inflation worries"

By Howard Schneider, Ann Saphir

February 23, 2021

WASHINGTON (Reuters) - Federal Reserve Chair Jerome Powell, pushing back on suggestions that loose monetary policy risked unleashing inflation and financial risks in what may be an emerging economic boom, said the central bank would keep its attention focused on getting Americans back to work as a vaccine-related recovery proceeds.

“Monetary policy is accommodative and it continues to need to be accommodative ..."

"Expect us to move carefully, patiently, and with a lot of advance warning,” before any changes, Powell said in response to questions from Republican lawmakers about whether a faster-than-expected recovery still required crisis-level assistance.

Powell, who was testifying before the U.S. Senate Banking Committee, acknowledged the potentially fast growth to come as the coronavirus crisis eases and vaccinations expand.

Coming updates to the Fed’s outlook may show the economy expanding “in the range” of 6% this year, he said, and overall output conceivably returning in the next few weeks to the pre-pandemic level.

Such a rebound would have been unthinkable even a few weeks ago, but the rollout of COVID-19 vaccines coupled with federal fiscal support that has bolstered household income has boosted the economic outlook for the year.

When asked what his message was to financial markets, Powell did not talk about the risks of rising bond yields or a possible spike in inflation, but of the roughly 10 million jobs still missing compared to a year ago, and the need for the U.S. central bank’s policy to stay wide open until that is fixed.

Interest rates will remain low and the Fed’s $120 billion in monthly bond purchases will continue “at least at the current pace until we make substantial further progress towards our goals ... which we have not really been making,” Powell said in the hearing, his first since Democrats won the White House and control of both chambers of Congress.

There was little market reaction to Powell’s remarks, though a recent sharp rise in Treasury bond yields, linked partly to concerns that inflation might surge and the Fed might tighten monetary policy sooner than expected, was largely curbed.

“Powell presumably wants to try to persuade markets that a strengthening economy does not necessarily mean that rates have to rise."

"Good luck with that when the post-COVID surge in activity becomes clear,” said Ian Shepherdson, chief economist at Pantheon Macroeconomics.


Some Republican senators expressed concerns the combination of Fed asset purchases, a potential vaccine-driven economic boom, and passage of another massive stimulus package may drive asset prices to unsustainable levels and spark inflation.

“Be it GameStop, Bitcoin, real estate, commodities, we are seeing quite elevated asset prices and signs of inflation,” said Republican Senator Pat Toomey, who is among those arguing that the Biden administration’s proposed $1.9 trillion spending plan should be tailored.

“There are a lot of warning signs that are blinking yellow,” Toomey said, referring to the recent run-up and crash of video-game retailer GameStop Corp’s stock and sharp moves in the value of the Bitcoin cryptocurrency.

Powell, however, said the focus needed to remain on an economic recovery that is “uneven and far from complete,” and which would need the central bank’s help for “some time” to get back to full employment.

The Fed’s interest rate cuts and monthly bond purchases “have materially eased financial conditions and are providing substantial support to the economy,” Powell said in his opening remarks to the committee.

“The economy is a long way from our employment and inflation goals, and it is likely to take some time for substantial further progress to be achieved,” the hurdle the Fed has set for discussing when it might be appropriate to pare back support.

Even with Americans being vaccinated at a rate of more than 1.5 million a day and coronavirus caseloads dropping, Powell and his fellow Fed policymakers are focused on the nearly 10 million jobs missing from the economy compared to a year ago, and the potent risks still posed by the virus, which has killed more than half a million people in the United States.

While the health crisis is improving and “ongoing vaccinations offer hope for a return to more normal conditions later this year,” Powell said, “the path of the economy continues to depend significantly on the course of the virus and the measures taken to control its spread.”

Powell will testify before the U.S. House of Representatives Financial Services Committee on Wednesday as part of his mandated twice-a-year appearances on Capitol Hill to provide an update on the economy.

Reporting by Howard Schneider; Editing by Paul Simao ... SKBN2AN118

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Post by thelivyjr » Wed Feb 24, 2021 1:40 p


"Analysis: Prices lurch higher as Home Depot, other importers battle surging cargo, commodity costs"

By Lisa Baertlein

February 23, 2021

(Reuters) - As Home Depot heads into its busy spring project season - when shoppers build backyard decks and buy patio furniture - it is tangling with surging costs for goods and transportation, on top of tariffs that cost it and other U.S. importers billions of dollars.

Across the United States, major retailers and makers of everything from Peloton spin bikes and La-Z-Boy recliners to Kia Sorrento SUVs are battling the same profit-squeezing pressures.

They pass those costs along to home-bound consumers, who are snapping up expensive-to-ship items like appliances, furniture and exercise equipment.

“As I think about all that’s going on now, I reflect back to the tariffs and... long for (when) that was our biggest issue,” Home Depot President Edward Decker said on a webcast on Tuesday.

Retailers like Home Depot, Walmart and got a boost when shoppers redirected travel and entertainment spending due to the COVID-19 pandemic.

Now they must quickly replenish supplies to sate consumer demand.

Like other U.S. importers, they are rushing in products from China, Vietnam and other Asian countries - swamping U.S. seaports and spawning delays and disruptions that ripple across the globe.

Home Depot struggled to keep enough products on shelves during the fourth quarter, when strong sales required it to bring in more inventory than a year earlier.

Home Depot executives said consumer prices for construction supplies like lumber and copper products are up due to commodity cost spikes.

“A stick of lumber that was 2-odd dollars is now over $5,” Decker said.

At the same time, major appliance prices are on a steep climb, with laundry equipment up more than 23% in January versus a year ago, according to the Bureau of Labor Statistics’ Consumer Price Index.


U.S. sea-borne imports hit $6.4 billion in January, up 159% from a year earlier, according to S&P Global Market Intelligence’s Panjiva unit and S&P Global Platts.

That was on top of a similar increase in the fourth quarter.

In recent weeks, the cost of transporting goods from Asia to the U.S. West Coast rose a whopping 200% year-over-year, while rates to the East Coast have more than doubled, data from S&P Global Platts Containers shows.

Port and container shipping executives say the bottlenecks may not dissipate until the second or early third quarter of this year.

Peloton Interactive plans to spend $100 million to expedite deliveries of spin bikes and other equipment.

That will require pricier air shipping and expedited ocean freight services, as well as the cost of routing cargo containers away from the Los Angeles/Long Beach port complex - which is suffering record backups.

Transportation- and commodity-related inflation could send costs $70-80 million higher this fiscal year, said David Maura, chief executive of Spectrum Brands, whose products include Kwikset locks, Hot Shot bug spray and George Foreman grills.

Parts shortages also contribute to the pain.

Kia Motors America is flying in computer chips due to a global shortage, spokesman Rick Douglas said.

La-Z-Boy last week said short supplies of components for its most-lucrative powered seating hit its sales mix.

“It feels like whack-a-mole."

"You figure out one (supply chain issue), get it fixed - and another piece comes up,” said Lifetime Products CEO Richard Hendrickson, whose Utah-based sporting goods company imports some items from China.

Reporting by Lisa Baertlein; Additional reporting by Timothy Aeppel and Melissa Fares in New York, Richa Naidu in Chicago, Jonathan Saul in London and Nivedita Balu in Bengaluru; Editing by Dan Grebler ... SKBN2AN2D1

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Post by thelivyjr » Wed Feb 24, 2021 1:40 p


"S&P 500, Dow close higher in late session turnaround"

By Stephen Culp

February 23, 2021

NEW YORK (Reuters) - Wall Street reversed course late Tuesday, with the S&P 500 and the Dow whipsawing to positive territory by the closing bell in a tug-of-war between stocks that thrived amid lockdowns and those that stand to benefit most from a reopening economy.

The Nasdaq was the only major U.S. stock index to lose ground on the day.

Market-leading growth stocks, which thrived amid pandemic-related lockdowns, weighed on stocks for much of the day as investors favored shares that stand to gain most as ongoing vaccine deployment allows economic restrictions to be lifted.

“People are buying the dip, a move that’s been rewarded for months in a one-sided market,” said Dennis Dick, head of market structure and a proprietary trader at Bright Trading LLC.

“It’s tough to be a bear, it’s really tough."

"The only fear out there is the fear of missing out,” Dick said.

Fed Chairman Jerome Powell pushed back against concerns that the central bank’s economic support increased the risk of spiraling inflation, and insisted that the central bank’s accommodative monetary policy would remain in place for “some time.”

Testifying before the Senate Banking Committee, Powell said the economic recovery was “uneven and far from complete,” adding that investors are mostly responding to an anticipated rebound as vaccine deployment curbs the pandemic.

“People took his words to heart."

"It made them go back to their buying lists,” said Chris Zaccarelli, chief investment officer at Independent Advisor Alliance in Charlotte, North Carolina.

“For people with cash on the sidelines waiting to put it to work maybe his interview this morning gave people a little confidence to go back to drawing board and put money to work this afternoon.”

The Dow Jones Industrial Average rose 15.66 points, or 0.05%, to 31,537.35, the S&P 500 gained 4.87 points, or 0.13%, to 3,881.37 and the Nasdaq Composite dropped 67.85 points, or 0.5%, to 13,465.20.

Of the 11 major sectors in the S&P 500, seven closed in positive territory, but consumer discretionary and tech shares suffered the largest percentage losses.

Tesla Inc lost 2.2% to close in negative territory for the year, pulled down amid the tech selloff and falling bitcoin, which lost 12.0%.

Tesla recently invested $1.5 billion in the cryptocurrency.

Cryptocurrency miners Riot Blockchain Inc and Marathon Patent Group Inc plunged 24.6% and 23.0%, respectively, while bitcoin bank Silvergate Capital Corp slid 20.1%.

Home improvement retailer Home Depot Inc posted better-than-expected quarterly earnings.

But it cast doubt on whether spiking sales, driven by homebound consumers taking on do-it-yourself projects amid COVID lockdowns, are sustainable going forward.

Its shares were the heaviest drag on the Dow, falling 3.1%.

Smaller rival Lowe’s Companies Inc, expected to report its results early Wednesday, also lost ground.

Declining issues outnumbered advancing ones on the NYSE by a 1.59-to-1 ratio; on Nasdaq, a 2.58-to-1 ratio favored decliners.

The S&P 500 posted 51 new 52-week highs and no new lows; the Nasdaq Composite recorded 171 new highs and 54 new lows.

Volume on U.S. exchanges was 16.52 billion shares, compared with the 16.06 billion average over the last 20 trading days.

Reporting by Stephen Culp; Additional reporting by Herbert Lash and Sinead Carew; Editing by Cynthia Osterman ... SKBN2AN15H

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