THE DAILY NEWS

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MARKETWATCH

"Oil prices end at lowest in a week as Trump reportedly weighs easing sanctions on Iran"


By Myra P. Saefong and William Watts

Published: Sept 11, 2019 3:06 p.m. ET

Oil futures declined on Wednesday, settling at their lowest in about a week, as a report that President Donald Trump is considering easing sanctions on Iran raised the possibility of the return of the country’s crude to the world market.

Trump discussed easing sanctions on Iran in a move to secure a meeting with Iranian President Hassan Rouhani later this month, Bloomberg News reported Wednesday, citing people familiar with the matter.

The move comes a day after Trump announced that U.S. National Security Adviser John Bolton, who had argued to push Iranian oil exports to zero, stepped down.

“Bolton is a known foreign policy hawk and, apparently, he and President Trump’s views began to diverge over time,” said Tyler Richey, co-editor at Sevens Report Research.

“Part of that very well could be that Trump’s keenly focused on the health of the U.S. economy and multiple foreign policy measures, including Iran sanctions, are acting as a headwind on U.S. consumer spending as oil prices, and ultimately prices at the pump, would be lower if sanctions were lifted,” he said.

A weaker demand outlook from OPEC on Wednesday also fed the price decline, despite U.S. government data showing a fourth straight weekly fall in domestic crude supplies.

West Texas Intermediate crude for October delivery fell $1.65, or 2.9%, to settle at $55.75 a barrel on the New York Mercantile Exchange — the lowest for a front-month contract since Sept. 3, according to Dow Jones Market Data.

November Brent crude lost $1.57, or 2.5%, to $60.81 a barrel on ICE Futures Europe, the lowest finish since Sept. 4.

A big weekly drawdown in U.S. crude supplies had provided some support for prices early Wednesday.

But Tariq Zahir, managing member at Tyche Capital Advisors, said he expects “supply will come online big time in the fourth quarter and first quarter” and that longer term, prices will have a hard time rallying as demand tends to be weaker at that time of year.


“And if a trade deal doesn’t happen, then [the market will see] even weaker demand globally,” he said.

The Organization of the Petroleum Exporting Countries on Wednesday lowered its forecast for global oil-demand growth in 2019 and 2020, citing weaker-than-expected data in the first half of this year from various global demand centers and slower economic growth projections.

Also on Wednesday, the Energy Information Administration reported that U.S. crude supplies fell by 6.9 million barrels for the week ended Sept. 6.


That marked a fourth weekly decline in a row.

On average, analysts polled by S&P Global Platts forecast a fall of 3.6 million barrels, while the American Petroleum Institute on Tuesday reported a drop of 7.2 million barrels.

“A tick higher in refinery runs and a dip lower in imports has yielded a solid draw to crude inventories — now down 69 million barrels, or 14%, from the high of the year in early June,” said Matt Smith, director of commodity research at ClipperData.

“Crude exports once again have come in above three million barrels per day, which is starting to look like the norm now that Permian pipelines have started up to Corpus Christi.”

The data, however, revealed “only a nominal decline in gasoline inventories and surprising build in distillate stocks; a bearish set of numbers that largely offset the crude headline,” Richey told MarketWatch.

The EIA data showed weekly supply decline of 700,000 barrels for gasoline, while distillate stockpiles climbed by 2.7 million barrels.

The S&P Global Platts survey had forecast an inventory loss of 1.4 million barrels for gasoline, but expected a rise of 220,000 barrels in distillate stockpiles.

Back on Nymex, October gasoline fell 1.3%, to $1.5699 a gallon, while October heating oil fell 1.5% to $1.9032 a gallon.

Oil traders on Tuesday digested the EIA’s decision to cut its U.S. and global benchmark crude-price forecasts for this year and next.

Meanwhile, October natural gas fell 2.8 cents, or 1.1%, to $2.552 per million British thermal units, ahead of the EIA’s update Thursday on supplies of the fuel.

Analysts polled by S&P Global Platts expect the government agency to report a weekly rise of 87 billion cubic feet in natural-gas stockpiles.

https://www.marketwatch.com/story/oil-b ... 2019-09-11
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MARKETWATCH

"Treasury yields rise as investors brace for ECB policy decision"


By Sunny Oh

Published: Sept 11, 2019 4:09 p.m. ET

U.S. Treasury yields edged higher Wednesday, extending the steep selloff in the past two days, as investors prepared for a key European Central Bank meeting on Thursday.

What are Treasurys doing?

The 10-year Treasury note yield was up 2.8 basis points to 1.733%, its highest level since Aug. 6.

The two-year note rate was virtually unchanged at 1.670%, while the 30-year bond yield rose 2.4 basis points to 2.208%, its highest since Aug. 9.

What’s driving Treasurys?

Investors are eyeing the ECB’s meeting on Thursday, when policy makers are expected to agree to some stimulus measures.

It’s unclear, however, if the ECB can launch an aggressive stimulus package amid criticism within its own ranks over the efficacy of negative rates.

Growing doubts about whether the ECB will be as dovish as once expected by investors have undermined appetite for long-term European and U.S. government paper in the past few sessions, helping to arrest the sharp plunge in global bond yields.

The German 10-year government bond yield has backed up to negative-0.56%, after trading as low as negative-0.72% last week.

In economic data, U.S. producer prices for August were up 0.1%.

The more widely-watched consumer price gauge will come out Thursday, with economists polled by MarketWatch anticipating an increase of 0.1% last month.

The U.S. Treasury Department auctioned off $24 billion of 10-year notes, but didn’t stir trading in the bond market.

What did market participants say?

“Market expectations are quite high ahead of the [ECB] meeting for a full stimulus package,” said Franck Dixmier, global head of fixed income at Allianz Global Investors, in an interview.

But the prospect for disappointment runs high because of the lack of agreement within the central bank over the need for further asset purchases from the central bank.

Dixmier pointed that ECB policymaker François Villeroy de Galhau questioned calls for an immediate resumption of bond-buying.

“There’s absolutely no consensus at the bank,” said Dixmier.

https://www.marketwatch.com/story/treas ... 2019-09-11
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MARKETWATCH

"U.S. wholesale inventories climb 0.2% in July, sales flat"


By Jeffry Bartash

Published: Sept 11, 2019 10:05 a.m. ET

WASHINGTON (MarketWatch) - Wholesale inventories in the U.S. rose 0.2% in July to rebound from a small decline in the prior month.

Sales in the month were flat, however.

The ratio of inventories to sales was also unchanged at 1.36.

That's how many months it would take to sell all the inventory on hand.

One year ago, the inventory-to-sales ratio was much lower at 1.27, suggesting that companies are either producing too much now or not selling good as fast as they were last year.

Still, an increase in inventories adds to gross domestic product.


https://www.marketwatch.com/story/us-wh ... 2019-09-11
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MARKETWATCH

"Wholesale prices inch up in August, PPI shows, but inflation isn’t stirring very much"


By Jeffry Bartash

Published: Sept 11, 2019 10:52 a.m. ET

The numbers:

The wholesale cost of U.S. goods and services rose slightly in August, but inflation more broadly was still quite low and showed little sign of stirring up any trouble for the U.S. economy.

The producer price index edged up 0.1% last month.

Economists polled by MarketWatch had predicted no increase.

Wholesale inflation rose a sharper 0.4% if the volatile categories of food, energy and retail-trade margins are stripped out, but most of the upward pressure in the so-called core rate in August is unlikely to persist.

Wholesale inflation has risen 1.8% in the past year, up from 1.7% in the prior month.

The yearly rate had touched a seven-year high of 3.4% last summer, however.

What happened:

The wholesale cost of services climbed 0.3% last month, including record increases in gambling receipts, guest room rentals, insurance and “arrangement of freight and cargo.”

These spikes are unlikely to be sustained, however, based on past movement in prices.

The wholesale costs of goods, on the other hand, fell 0.5%.

Prices fell for food, liquor, gasoline and other forms of fuel.

The disparity between goods and services has persisted for much of the past year.

Wholesale service costs have risen 2.7% in the last 12 months vs. a slight decline in the cost of goods.

The increase in the core rate of wholesale inflation over the past 12 months rose to 1.9% in August from 1.7%.

Economists prefer core inflation readings because food, gas and trade margins can swing sharply from month to month and mask underlying price trends.

The wholesale cost of raw and partly finished goods both fell in August and are negative in the past year, suggesting little inflation in the “pipeline.”

Big picture:

Inflation fell earlier in the year and is running short of the Federal Reserve’s 2% target, but the decline in prices may be coming to an end.

Some measures of inflation indicate prices could be creeping higher again and economists warn that higher tariffs on Chinese goods could feed into inflation also.

The cost of most goods and services are relatively stable, however, and that will give the Fed more room to cut interest rates if the central bank believes the economy needs a boost.

The Fed is widely expected to reduce rates next week as an antidote of sorts to the damage caused by the trade war.

What they are saying?

“The trend [in inflation] is rising gently, we think, though the data have been so noisy this year that we can’t be sure,” said Ian Shepherdson, chief economist of Pantheon Macroeconomics.

Market reaction:

The Dow Jones Industrial Average and S&P 500 rose modestly in Wednesday trades.

The 10-year Treasury yield was flat at 1.72%.

https://www.marketwatch.com/story/whole ... 2019-09-11
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MARKETWATCH

"Trump tweets support for negative interest rates"


By Steve Goldstein

Published: Sept 11, 2019 10:33 a.m. ET

President Donald Trump is not known to be shy to express views on interest-rate policy, but even by his standards, some Wednesday morning tweets raised eyebrows.

....The USA should always be paying the the lowest rate.

No Inflation!

It is only the naïveté of Jay Powell and the Federal Reserve that doesn’t allow us to do what other countries are already doing.

A once in a lifetime opportunity that we are missing because of “Boneheads.”

— Donald J. Trump (@realDonaldTrump) September 11, 2019

With that, Trump becomes the first president to say that he would want interest rates below zero.

The Fed has always expressed great reluctance to bring interest rates into negative territory, and during the Great Recession they opted to use unconventional measures like buying bonds rather than setting negative interest rates.

Other central banks, notably the European Central Bank, do have negative interest rates, to mixed reviews.

European banks have struggled to make profits with interest rates below zero.


The ECB on Thursday is expected to cut interest rates further, while the Fed meets next week with expectations of a rate cut, albeit a modest reduction from the current target between 2% and 2.25%.

Refinancing the nation’s debt, Trump’s other suggestion, would also prove contentious and the Treasury Department so far has not taken steps to do so.

The furthest Treasury Secretary Steven Mnuchin has gone to take advantage of current low rates is to publicly muse about the idea of issuing ultra-long term bonds.


While Trump’s suggestions would be jarring coming from any other president, global financial markets have gotten used to them.

Neither stock futures nor bonds moved much in reaction.

https://www.marketwatch.com/story/trump ... 2019-09-11
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MARKETWATCH

"Dear Mr. President, why is it a good thing if a 10-year Treasury note is worth less than a bag of dirt?"


By Greg Robb

Published: Sept 11, 2019 12:48 p.m. ET

President Donald Trump’s demand on Wednesday that the Federal Reserve slash its benchmark interest rate “to zero or even negative” is misguided, economists say, because rates that low would be a sign of weak economic conditions.

“Trump is confused."

"European rates are low because Europe is in trouble,” said Robert Brusca, chief economist at FAO Economics.

Carl Weinberg, chief economist at High Frequency Economics, noted that when a 10-year government note has negative interest rates, it is worth less than “a bag of dirt stored in your basement.”


Negative bond yields is a “red flag” that money has lost its value, he said.

The risk is it may trigger “feckless spending”

Trump is the first U.S. president to say that he would want interest rates below zero.

The Federal Reserve should get our interest rates down to ZERO, or less, and we should then start to refinance our debt. INTEREST COST COULD BE BROUGHT WAY DOWN, while at the same time substantially lengthening the term. We have the great currency, power, and balance sheet.....

— Donald J. Trump (@realDonaldTrump) September 11, 2019

Jeremy Siegel, finance professor at the Wharton School at the University of Pennsylvania, said he thinks the Fed’s benchmark federal funds rate should be lowered, but not to zero or even negative.

At the moment, the Fed’s benchmark rate is in a range between 2%-2.25%.

Siegel said he’d like to see the fed funds rate down between 1%-1.5%.

That would put rates below the yield on the 10-year Treasury note.

Fed watchers expect the U.S. central bank to be much more cautious and trim its policy rate by a quarter point to 1.75%-2% at its policy meeting next week.

There is a lively debate among analysts about how low rates will ultimately go.

Fed officials have stressed they are not anticipating a major easing.

Yields on U.S. 10-year notes have fallen from 3.45% last November to as low as 1.46% in late August.

Negative rates would mean that a recession was inevitable, Siegel said.

Diane Swonk, chief economist at Grant Thornton, agreed, saying on Twitter that a steep drop in the Fed’s benchmark rate would be a signal to the market that the economy was much weaker than it appears.


Some thoughts of the Fed dropping rates to zero or less:

Market participants would likely view such a drop in rates as a signal that the economy is much weaker than it appears, which runs the risk of triggering a panic and self-fulfilling recession.
— Diane Swonk (@DianeSwonk) September 11, 2019

Interest rates are at zero on government debt in Japan and Europe because those regions are barely growing economically.

In contrast, the U.S. has had economic growth above 2% this year, she said.

Trump also tweeted that the U.S. should “refinance” its nearly $17 trillion outstanding debt.

This is also a puzzle to economists because the U.S. Treasury debt is not callable, like a mortgage, that can be paid off early.

The Treasury debt that pays a high interest rate has to run off in order to be refinanced at lower yields.


But it makes a lot of sense for the government to issue new long-term debt with interest rates so low, Siegel said.

https://www.marketwatch.com/story/dear- ... 2019-09-11
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Transcript of Robert S. Mueller III’s testimony before the House Judiciary Committee

By Washington Post Staff

July 24, 2019

HOUSE JUDICIARY COMMITTEE HEARING ON OVERSIGHT OF THE REPORT ON THE INVESTIGATION INTO RUSSIAN INTERFERENCE IN THE 2016 PRESIDENTIAL ELECTION: FORMER SPECIAL COUNSEL ROBERT S. MUELLER, III

STEUBE: Given your 22 months of investigation, tens of million dollars spent and millions of documents reviewed, did you obtain any evidence at all that any American voter changed their vote as a result of Russia’s election interference?

MUELLER: I’m not going to speak to that.

STEUBE: You can’t speak to that after 22 months of investigation, there’s not any evidence in that document before us that any voter changed their vote because of their interference and I’m asking you based on all of the documents that you reviewed...

MUELLER: That was - that was outside our purview.

STEUBE: Russian meddling was outside your purview?

MUELLER: But the impact of that meddling was undertaken by other agencies.

STEUBE: OK, you stated in your opening statement that you would not get into the details of the Steele Dossier.

However multiple times in Volume 2 on page 23, 27 and 28 you mentioned the unverified allegations.

How long did it take you to reach the conclusion that it was unverified?

MUELLER: I’m not going to speak to that.

STEUBE: It’s in - it’s actually in your report multiple times that its unverified and you’re telling me that you’re not willing to tell us how you came to conclusion that it was unverified?

MUELLER: True.

STEUBE: When did you become aware that the unverified Steele Dossier was included in the FISA application to spy on Carter Page?

MUELLER: I’m sorry, what was the - what was the question?

STEUBE: When did you become aware that the unverified Steele Dossier was intended - was included in the FISA application to spy on Carter Page?

MUELLER: I’m not going to speak to that.

STEUBE: Your team interviewed Christopher Steele, is that correct?

MUELLER: Not going to get into that.

I said it - I...

STEUBE: You can’t - you can’t - you can’t tell this committee as to whether or not you interviewed Christopher Steele in a 22 month investigation with 18 lawyers?

MUELLER: As I said at the outset, that is one of those - one of the investigations that is being handled by others in the Department of Justice.

STEUBE: Yes but you’re here testifying about this investigation today and I am asking you directly did any members of your team or did you interview Christopher Steele in the course of your investigation.

MUELLER: And I am not going to answer that question, sir.

STEUBE: You had two years to investigate, not once did you consider it worthy to investigate how an unverified document that was paid for by a political opponent was used to obtain a warrant to spy on the opposition political campaign.

Did you do any investigation in that way (ph)?

MUELLER: I do not accept your characterization of what occurred.

STEUBE: What would you - what would be your characterization?

MUELLER: I’m not going to speak any more to it.

STEUBE: Can - can’t the president fire the FBI director at any time without reason under the Article I of the Constitution?

MUELLER: Yes.

STEUBE: Article II.

MUELLER: Yes.

STEUBE: That’s correct.

Can’t he also fire U.S. Special Counsel at any time without any reason?

MUELLER: I believe that to be the case.

STEUBE: Under Article II.

MUELLER: Well hold on just a second, you said without any reason, I know the Special Counsel can be fired, but I’m not certain it extends to for whatever reasons is given.

STEUBE: Well then you’ve testified that you weren’t fired, you were able to complete your investigation in full.

Is that correct?

MUELLER: I’m not going to add to what I’ve stated before.


AND AS THIS SILLY FARCE CONTINUES ALONG ITS BUMBLING AND ERRATIC PATH …

IT RAISES THE EXISTENTIAL QUESTION OF WHETHER THE DEMOCRATS ARE STILL FIXIN' TO GET WITH IMPEACHING TRUMP, OR WHETHER THEY ARE ACTUALLY GETTING WITH IMPEACHING TRUMP, OR MAYBE THEY'RE DOING SOMETHING ELSE, ALTOGETHER …

LIKE DITHERING ...

THE WASHINGTON POST

"The straightforward question House Democrats can’t answer"


JM Rieger

12 SEPTEMBER 2019

Depending on whom you ask, on Thursday morning, the House Judiciary Committee will vote on procedures to investigate whether to open an impeachment inquiry or to continue an already opened impeachment inquiry.

Or maybe there is no inquiry at all.

At this point, it’s hard to say, in part because House Democrats offer different, often-strained answers to a straightforward question: Has the House begun an impeachment investigation of President Trump?


As House Speaker Nancy Pelosi (D-Calif.) has taken a hands-off approach to what Judiciary Committee Chairman Jerrold Nadler (D-N.Y.) in August labeled an impeachment inquiry, rank-and-file House Democrats have found themselves engaged in semantic battles over what exactly the House is doing on impeachment.

You can watch examples of the various descriptions by Democrats of the status of impeachment in the video above.

The committee is scheduled to meet at 8 a.m. Thursday to vote on a resolution to expand its investigatory options to include rarely used procedures to look into Trump.

Over the past three days, House Democrats have characterized Thursday’s vote in three ways: as a procedural motion, as a formalizing of an existing impeachment inquiry and as the start of an impeachment inquiry.

“We’re holding hearings for the purpose of investigating the possibility of voting [on] articles of impeachment,” Nadler told NBC News this week.


On Monday morning, a second member of the House Judiciary Committee, Rep. Debbie Mucarsel-Powell (D-Fla.), told CNN that it was “no secret” that the committee was conducting an impeachment investigation.

Later on Monday, a third member of the committee, Rep. Steve Cohen (D-Tenn.), said Thursday’s vote would “formalize having an impeachment inquiry.”

And on Wednesday, a fourth member of the committee, Rep. Hakeem Jeffries (D-N.Y.), would not commit that an impeachment inquiry was underway.

“We’re in the midst of a Judiciary Committee investigation,” Jeffries said.

In fact, Nadler’s comments in August acknowledged that House Democrats had started an impeachment inquiry when the Judiciary Committee in July argued in a court filing that it needed the full, unredacted report from former special counsel Robert S. Mueller III because it “is conducting an investigation to determine whether to recommend articles of impeachment.”


Debating where impeachment stands is confusing and jargon-heavy.

But Democrats’ semantic contortions this week are significant.

They suggest a nonexistent or confusing messaging strategy on impeachment, which is the most serious investigation the House can consider.

The confusion also reflects two more realities for House Democrats: Most Americans and most House lawmakers oppose an impeachment inquiry, even as a majority of House Democrats support one.


Fourteen months before the 2020 presidential election, Democratic leadership does not have its impeachment messaging straight.

On Wednesday morning, House Majority Leader Steny H. Hoyer (D-Md.) told reporters that an impeachment inquiry was not underway.

Less than two hours later, Hoyer offered a clarification that wasn’t exactly clarifying.

“I thought the question was in regards to whether the full House is actively considering articles of impeachment, which we are not at this time,” he said in a statement.

“ … I strongly support Chairman Nadler and the Judiciary Committee Democrats as they proceed with their investigation ‘to determine whether to recommend articles of impeachment to the full House,’ as the resolution states.”

Rachael Bade and Amber Phillips contributed to this analysis.

http://www.msn.com/en-us/news/politics/ ... id=HPDHP17
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MARKETWATCH

"Dow logs 7th gain in a row on renewed trade optimism, ECB stimulus"


By Chris Matthews and Mark DeCambre

Published: Sept 12, 2019 4:40 p.m. ET

The Dow marked its longest win streak in more than a year Thursday, after the European Central Bank’s announced fresh stimulus measures, including an interest-rate cut that moved a deposit rate further into negative territory, raising hopes that the Federal Reserve may also enact easy-money policies next month.

The market had been on an uptrend early in the day following reports suggesting that U.S. and China trade aggressions continued to soften ahead of meeting next month.

How are the major benchmarks performing?

The Dow Jones Industrial Average rose 45.41 points, or 0.2%, to close at 27,182.45, notching a seventh advance and the longest series of gains for the blue-chip index since an eight-session rally ended May 14, 2018, according to FactSet data.

Meanwhile, the S&P 500 index added 8.64 points, or 0.3%, to finish at 3,009.57, while the Nasdaq Composite Index advanced 24.79 points, or 0.3%, to end at 8,194.47.

All three benchmarks ended the day off their best levels as market’s pulled back as the index’s came within striking distance of recent closing highs.

Thursday’s action left the Dow and S&P just about 0.7% and 0.5% from their respective record closes, while the Nasdaq ended the day 1.6% from its all-time closing high.

What’s driving the market?

The Dow reversed modest Thursday morning losses to turn higher after Bloomberg reported that the Trump administration at it is considering an interim deal to avoid planned tariff increases, but White House sources immediately denied the U.S. was working on such a deal.

And there was skepticism about a deal from money managers such as DoubleLine Chief Executive Jeffrey Gundlach, who said he did not believe there would be a trade deal before the U.S. presidential election next year.


The news followed tweets by President Trump Wednesday announcing he would delay a tariff hike — from 25% to 30% — that was scheduled to take effect Oct. 1, until Oct. 15, “as a gesture of goodwill.”

A separate report in The Wall Street Journal cited Chinese officials, who are looking to narrow the scope of the negotiations to exclude national security issues, as it hopes to make progress on the tariff front.

The moves come as American and Chinese representatives are slated to meet in early October to restart stalled trade negotiations and avert any further escalation of animosities between the economic superpowers.

No date has been set to begin the high-level trade discussions, but the latest olive branch did help to reflect a momentary softening of tensions between Beijing and Washington, which had rattled global economies, because an outright trade war could further weaken an already international economy.

“The S&P 500 has now fully retraced the August pullback, and in doing so has priced in a lasting U.S.-China trade truce and aggressive [global] central bank easing…and no more geopolitical surprises,” wrote Tom Essaye, president of the Sevens Report in a Thursday note to clients.

“Proof of that is evident in the lack of a rally despite the short tariff delay announcement,” he added.

“At these levels, a trade 'truce' (so no more tariffs) is mostly priced into stocks, just a delay won’t be a positive catalyst — the market already expects more.”

Earlier Thursday morning stocks rose on news the European Central Bank cut its deposit rate from -0.4% to -0.5%, while announcing it would restart open-ended purchasing of long-term government bonds at a pace of €20 billion a month in an effort to further reduce long-term interest rates.

The bank said rates would remain at “present or lower levels” until the inflation outlook “robustly” converges with its target of just below 2%.


In an effort to mitigate the effects of negative rates on bank profitability, the central bank introduced a system of tiered rates that will exempt some bank reserves held at the bank.

Investors were also watching new economic data which showed the number of Americans applying for new unemployment benefits fell by 15,000 to 204,000 during the week ended Sept. 7, below economists expectations of 213,000, according to a MarketWatch poll.

The U.S. consumer-price index rose 0.1% in August, in line with expectations, while core inflation rose 0.3%, above forecasts of a 0.2% gain.

The year-over-year rise in underlying inflation advanced to 2.4%, matching a 13-month high.

Which stocks were in focus?

Shares of Oracle Corp. were in focus after the technology company late Wednesday said co-CEO Mark Hurd was taking a leave of absence for health reasons, while announcing that fiscal first quarter revenue grew short of Wall Street estimates.

Co-CEO Safra Catz and Chairman Larry Ellison will cover Hurd’s duties, the company said.

Oracle shares fell Thursday morning.

Shares finished 4.3% lower.

Hertz Global Holdings Inc. stock rose 3.6% Thursday, after billionaire investor Carl Icahn disclosed that he increased his stake in the car rental company to 30.1% of the shares outstanding.

Shares of AT&T Inc. fell 0.9%, after the telecom giant flagged low upgrade rates as a potential threat to revenue in the third quarter, while projecting WarnerMedia revenues to fall roughly $400 million, as “a number of second-half 2018 hit movies” poses challenges to year-over-year growth.

SmileDirectClub Inc. tumbled nearly 28% in its debut at as public company.

The company, which sells clear teeth aligners, finished at $16.67 after pricing its initial public offering Wednesday afternoon at $23 apiece.

How are other markets trading?

The yield on the 10-year U.S. Treasury note rose 5.6 basis points to 1.789% Thursday.

In commodity markets, the price of crude oil ended 1.2% lower to $55.09 a barrel on the New York Mercantile Exchange after falling more than 2% on Wednesday after an IEA report forecasting increased supplies and the failure of the OPEC+ meeting in Abu Dhabi to address production cuts.

Gold prices closed 0.3% higher at roughly $1,507.40 an ounce.

The U.S. dollar, meanwhile, slumped 0.3% lower relative to a basket of leading rivals.

In Asia overnight Thursday, the China CSI 300 gained 1.1%, while Hong Kong’s Hang Seng Index shed 0.3% and Japan’s Nikkei 225 rose 0.8%.

European shares edged higher Thursday following the ECB move, with the Stoxx Europe 600 closing with a 0.2% gain.

https://www.marketwatch.com/story/dow-s ... latestnews
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MARKETWATCH

"Oil ends with a loss as OPEC+ puts talk of deeper output cuts on hold until December"


By Myra P. Saefong and Mark DeCambre

Published: Sept 12, 2019 3:43 p.m. ET

Oil futures finished with a loss on Thursday as OPEC and its allies reiterated their commitment to current output cuts, but failed to announce bigger production cuts as some had expected in the wake of easing tensions between the U.S. and Iran.

In a press release, the Joint Ministerial Monitoring Committee, or JMMC, which monitors compliance with output reductions set by an OPEC+ agreement that began at the start of this year, “underscored the critical need for continued commitment” to the pledged cuts.

It said compliance with the cuts stood at 136% in August.

Oman’s oil minister Mohammed bin Hamad al-Rumhy said OPEC+ would discuss the possibility of deepening the existing output cut deal when the group meets in December, according to a news report from Argus.

The JMMC will hold its next meeting in Vienna on Dec. 4, ahead of the OPEC and non-OPEC meetings on Dec. 5-6.

West Texas Intermediate crude for October delivery fell 66 cents, or 1.2%, to settle at $55.09 a barrel on the New York Mercantile Exchange, after falling nearly 3% on Wednesday, marking the lowest close for a front-month contract since Sept. 3, according to Dow Jones Market Data.

November Brent crude lost 43 cents, or 0.7%, to $60.38 a barrel on ICE Futures Europe, after shedding 2.5% a day ago.

Market participants had raised the likelihood that OPEC+, a group of OPEC members that includes Russia, would act to stem recent bearish developments for crude prices, amid reports by Bloomberg News that President Donald Trump discussed easing sanctions on Iran in a move to ensure a meeting with Hassan Rouhani, Iran’s president, later this month.

“The challenges for OPEC are now more daunting as the cartel and its playing hard to get counter partner Russia is now having to face the reality that stored Iranian oil could flood the market,” wrote Phil Flynn, senior market analyst at Price Futures Group, in a Thursday research report.

Flynn said that compliance to the OPEC production limit has been starting to slip.

“To date, support for the agreement rate has been high,” but before Thursday’s meeting, data for August showed the compliance rate slipping to 116%, he wrote.

“In August, three major countries Russia, Nigeria and Iraq, produced 0.6 mb/d more than their allocations."

"Saudi Arabia, on the other hand, produced 0.6 mb/d less than allowed, and it is clearly the lynchpin of the whole deal,” he said.

Oil prices also settled lower after a monthly report from the International Energy Agency said that supplies from outside of OPEC would rise by 2.3 million barrels a day in 2020, from 1.9 million barrels a day this year.

The IEA left its daily global demand growth forecast at 1.1 million for 2019 and 1.3 million barrels for 2020.

OPEC on Wednesday lowered its forecast for global oil-demand growth in 2019 and 2020, citing weaker-than-expected data in the first half of this year from various global demand centers and slower economic growth projections.

Also on Wednesday, the Energy Information Administration reported that U.S. crude supplies fell by 6.9 million barrels for the week ended Sept. 6.

That marked a fourth weekly decline in a row.

On average, analysts polled by S&P Global Platts forecast a fall of 3.6 million barrels, while the American Petroleum Institute on Tuesday reported a drop of 7.2 million barrels.

Natural-gas prices, meanwhile, finished higher after the EIA reported Thursday that domestic supplies of natural gas rose by 78 billion cubic feet for the week ended Sept. 6.

The average forecast of analysts polled by S&P Global Platts had called for an increase of 87 billion cubic feet.

October natural gas settled at $2.574 per million British thermal units, up 2.2 cents, or 0.9%.

Rounding out action on Nymex, October gasoline fell 1.7 cents, or 1.1%, to $1.553 a gallon and October heating oil lost 1.8 cents, or 1%, to $1.8851 a gallon.

https://www.marketwatch.com/story/us-oi ... 2019-09-12
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MARKETWATCH

"10-year Treasury touches nearly six-week high after trade fears ease"


By Sunny Oh

Published: Sept 12, 2019 4:17 p.m. ET

U.S. Treasury yields rose Thursday after reports that the White House had discussed the possibility of a limited trade agreement with Beijing, sparking a selloff in haven assets like government bonds.

What are Treasurys doing?

The 10-year Treasury note yield climbed 5.6 basis points to 1.789%, around a six-week high, while the two-year note rate was up 5.3 basis points to 1.723%, also a nearly six-week high.

The 30-year bond yield advanced 5.5 basis points to a five-week high of 2.263%.

The German 10-year government bond yield was up 4.3 basis points to negative-0.521%, while the 10-year Italian bond yield fell 12 basis points to 0.862%, briefly scraping a record low of 0.79%.

What’s driving Treasurys?

Investors saw some positive developments on the international trade front.

Bloomberg News reported that the White House was contemplating a limited trade deal with China.

In return for promises on agricultural purchases and intellectual-property issues, the U.S. would delay and take away some tariffs on Chinese imports.

But a senior White House official later denied the report to CNBC.

Late Wednesday, President Donald Trump delayed a tariff increase on around $250 billion in Chinese imports that had been originally slated to start on Oct. 1.

Trump postponed the increase to Oct. 15, to avoid conflicting with the 70th anniversary of the Chinese Communist Party’s rule.

The Wall Street Journal reported that Beijing was looking to split trade negotiations into two tracks, separating the more thornier national security issues from less contentious trade concerns, in the hopes of advancing stalled trade talks with the U.S.

A lackluster U.S. debt auction for 30-year maturities also weighed on prices for government paper, lifting yields.

The auction tailed by 1.3 basis points, a sign that the bond sale struggled to draw sufficient demand.

The European Central Bank initially sparked buying in global bond markets at the start of the trading session after cutting its deposit rate by 10 basis points to negative-0.5%, as expected.

More importantly, it announced it would buy €20 billion ($22 billion) of bonds every month.

But analysts said the level of the ECB’s stimulus measures appeared to disappoint investors who had piled into long-term European debt ahead of the meeting.

Market participants also considered an update on U.S. inflationary pressures.

The U.S. consumer price data for August rose 0.1%, but climbed 0.3% on the core gauge stripping out for food and energy prices.

Underlying inflation, stripping out food and energy prices rose 2.4%, the fastest rate in 13 months.

What did market participants say?

“Stock markets are desperate for an end to tariffs, and bond markets will take weeks to get used the trade whipsaw,” said Jim Vogel, an interest-rate strategist at FTN Financial.

“On the surface, the [ECB] announcement is somewhat disappointing relative to market expectations as far as today’s rate cut is concerned (‘only’ 10 bps) but also with regard to the amount of monthly purchases under the re-introduced asset purchase program APP (‘only’ 20 bn),” noted Andreas Billmeier, a sovereign analyst at Western Asset Management.

https://www.marketwatch.com/story/treas ... latestnews
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