InvestMacro

By JustMarkets

At yesterday’s stock market close, the Dow Jones Index (US30) increased by 0.15%, while the S&P 500 Index (US500) added 0.03%. The NASDAQ Technology Index (US100) closed positive by 0.12% on Thursday.

US inflation data came out better than expected. The overall annualized inflation rate rose from 3% to 3.2% (forecast 3.3%), while core inflation (excluding food and energy prices) fell from 4.8% to 4.7% (forecast 4.8%). Year-on-year inflation rose for the first time since July 2022, and oil prices, which have risen 27% in a month and a half, will do nothing to further reduce inflation. There is a lot of uncertainty on the economic front right now, but what is clear is that the Fed plans to keep rates high. Before the September meeting of the Fed, the market will see another publication of macro statistics on the labor market and inflation, so investors are in no hurry to make bets and open new positions. Therefore, the end of August is likely to pass on lower volatility.

Fed San Francisco President Mary Daly expressed a cautious tone, saying that while the latest inflation data is moving in the right direction, more progress is needed before it is clear that the central bank has done enough.

Wynn Resorts Limited (WYNN) reported quarterly results that beat Wall Street estimates for both top-line and net income, helped by the continued strength of its Macau business. Alibaba Group Holdings (BABA) shares rose more than 4% after reporting quarterly earnings that notably beat analysts’ estimates.

Equity markets in Europe were mostly up yesterday. Germany’s DAX (DE40) rose by 0.91%, France’s CAC 40 (FR40) gained 1.52% on Thursday, Spain’s IBEX 35 (ES35) jumped by 1.52%, and the UK’s FTSE 100 (UK100) closed up by 0.41%.

UK GDP data will be released today. The economy is expected to grow by 0.2% for the quarter, while on an annualized basis, the economy is expected to remain at 0.5%. This data could have an impact on the outlook for the Pound and the UK100 Index. UK inflation data is expected next week, which should give a clearer picture of the Bank of England’s (BoE) stance on monetary policy. The latest market estimates put the probability of a 25 basis point rate hike on September 21 at nearly 70%, with the final rate expected to be 5.75% next March.

The US Treasury yields initially fell on the release of CPI below the fixed line and then recovered as a deeper analysis of the inflation report noted rising services inflation. Gold has an inverse correlation to government bond yields, so it was sold off at the end of the trading session yesterday.

Oil prices declined on Thursday, with Brent crude holding close to January highs. Speculation of another US interest rate hike subsided after inflation data and OPEC maintained positive oil demand forecasts.

Asian markets traded flat yesterday. Japan’s Nikkei 225 (JP225) gained 0.84%, China’s FTSE China A50 (CHA50) fell by 0.13%, Hong Kong’s Hang Seng (HK50) gained 0.01% on the day, and Australia’s S&P/ASX 200 (AU200) was positive by 0.26% on Thursday.

Fears of a collapse in China’s real estate market are renewed amid reports that the country’s largest real estate developers are having trouble meeting their debt obligations. Shares in China’s major real estate companies faced a fresh wave of selling on Friday after Country Garden Holdings, one of the country’s largest real estate companies, warned of huge losses in the first half of 2023.

S&P 500 (F)(US500) 4,468.83 +1.12 (+0.03%)

Dow Jones (US30) 35,176.15 +52.79  (+0.15%)

DAX (DE40)  15,996.52 +143.94 (+0.91%)

FTSE 100 (UK100) 7,618.60 +31.30 (+0.41%)

USD Index  102.64 +0.15 (+0.15%)

• – UK GDP (m/m) at 09:00 (GMT+3);
• – UK Industrial Production (m/m) at 09:00 (GMT+3);
• – UK Manufacturing Production (m/m) at 09:00 (GMT+3);
• – US Producer Price Index (m/m) at 15:30 (GMT+3);
• – US Michigan Consumer Sentiment (m/m) at 17:00 (GMT+3).

By JustMarkets

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

By JustMarkets

At yesterday’s stock market close, the Dow Jones Index (US30) decreased by 0.54%, while the S&P 500 Index (US500) was down by 0.70%. The NASDAQ Technology Index (US100) closed negative by 1.17% on Wednesday. Shares of chip and semiconductor companies declined, dragging down the tech sector. Investors remain wary of making bullish bets on tech companies ahead of inflation data to be released today. The annualized inflation rate is expected to rise slightly from 3.0% to 3.3%, with core inflation (which excludes food and energy prices) falling from 4.8% to 4.7%. Core inflation and services inflation will be the main focus of economists.

The US expected inflation indicator, closely watched in the bond market, rose to a nine-year high, signaling that inflationary pressures could return with renewed vigor and the Federal Reserve may continue to combat the increased pressure by raising rates further.

Disney’s ESPN television channel struck a $2 billion deal with bookmaker PENN Entertainment to launch ESPN Bet, a sports betting company. PENN is up more than 7%. Walt Disney on Wednesday missed Wall Street expectations for quarterly revenue but said it was on track to cut costs by more than the $5.5 billion promised to investors in February. Shares fell about 1% in after-hours trading following the release of the results.

Equity markets in Europe were mostly up yesterday. Germany’s DAX (DE40) increased by 0.49%, France’s CAC 40 (FR40) gained by 0.72% on Wednesday, Spain’s IBEX 35 (ES35) rose by 0.57%, and the UK’s FTSE 100 (UK100) closed up by 0.80%.

Over the past week, crude oil inventories rose by 5.851 million barrels after a historic drop of 17.049 million barrels last week. But disregarding the fundamental shift in US oil supply, oil traders are more encouraged by Saudi Arabia’s promised production cuts, bringing crude prices to their highest level in nine months.

Asian markets traded flat yesterday. Japan’s Nikkei 225 (JP225) decreased by 0.53%, China’s FTSE China A50 (CHA50) was down by 0.07%, Hong Kong’s Hang Seng (HK50) added 0.32% on the day, and Australia’s S&P/ASX 200 (AU200) was positive by 0.37% on Wednesday. Investor sentiment towards Chinese stocks deteriorated after US President Joe Biden signed an executive order outlining additional restrictions on US investment in China’s technology sector. On Wednesday, President Joe Biden signed an executive order banning some new US investments in China in sectors such as semiconductors and microelectronics, quantum information technology, and some artificial intelligence systems. The decree aims to prevent US capital and expertise from helping China develop technologies that could support its military modernization and undermine US national security. China said Thursday it was “seriously concerned” about the order and reserved the right to take action. China urged the US that it had no intention of alienating China or hindering its economic development.

S&P 500 (F)(US500) 4,467.71 −31.67 (−0.70%)

Dow Jones (US30) 35,123.36 −191.13 (−0.54%)

DAX (DE40)  15,852.58 +77.65 (+0.49%)

FTSE 100 (UK100) 7,587.30 +59.88 (+0.80%)

USD Index  102.51 -0.02 (-0.02%)

• – Japan Producer Price Index (m/m) at 02:50 (GMT+3);
• – Norway Inflation Rate (m/m) at 09:00 (GMT+3);
• – US Consumer Price Index (m/m) at 15:30 (GMT+3);
• – US Initial Jobless Claims (w/w) at 15:30 (GMT+3);
• – US Natural Gas Storage (w/w) at 17:30 (GMT+3);
• – FOMC Member Harker Speaks at 23:15 (GMT+3).

By JustMarkets

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

Source: Ron Struthers  (8/7/23)

The long end of the bond market is starting to price in sticky inflation, and Ron Struthers of Struthers’ Stock Reports expects interest rates to rise further. Higher energy prices will start adding to inflation again, adding to the problem. Moderna has broken down on the chart and will be reporting red ink in the next few years. Time to go short.

On August 3rd, Moderna reported Q2 results:

• Second quarter 2023 revenues of US$0.3 billion with a net loss of US$1.4 billion and loss per share of US$3.62;
• Covid-19 vaccine sales are now US$2.1 billion for the first half of the year;
• Company expects 2023 COVID-19 vaccine sales of US$6 billion to US$8 billion, dependent on U.S. vaccination rates.

“Second quarter sales were on target, given the seasonal nature of Covid. I am pleased with the progress our U.S. commercial team has made to get new contracts in place for fall 2023. We are on track to deliver 2023 sales between US$6 billion to US$8 billion, depending on Covid vaccination rates in the U.S.,” said Stéphane Bancel, CEO of Moderna. “Our late-stage clinical pipeline is firing on all cylinders with four infectious disease vaccines in Phase 3, including RSV, which was recently submitted to regulators for approval. Our individualized neoantigen therapy is now in Phase 3 for melanoma, and our lead rare disease program for PA is in dose confirmation. We believe that all these products should launch in 2024, 2025, or 2026, and we are continuing to invest in scaling Moderna to bring forward an unprecedented number of innovative mRNA medicines for patients.”

Moderna will be totally reliant on Covid-19 vaccine sales to drive revenues for the next 12 months. I believe they have zero chance of making their US$6 to US$8 billion targets. If they did hit, say mid, way at US$7 billion, it would likely mean no profits. Their cost of sales in Q2 was US$731 million, and the R&D expense was over US$1 billion.

This will likely stay high with their pipeline of development vaccines. General Administration expense was US$332 million in Q2, and this will not likely drop much. Their expenses are running over US$2 billion per quarter, so another US$4 or US$5 billion in sales for the rest of the year will not generate profits.

How long can the stock stay over US$100 with a market cap of around US$40 billion, with mounting losses and no profits in sight?

That said, what if they disappoint as I expect they will?

This year, the UK has followed other European countries and is not recommending Covid-19 shots for those under 50. I expect this trend will continue as the risk/reward does not make sense for younger people. As more and more independent studies come out, we find that the risk or adverse events with these shots are much higher than we were led to believe. Also, the effectiveness of the shots is very questionable.

Some examples –

Example One – Eight people who died suddenly after receiving a messenger RNA (mRNA) COVID-19 vaccine died due to a type of vaccine-induced heart inflammation called myocarditis, South Korean authorities said after reviewing the autopsies. The study was published by the European Heart Journal on June 2 and was funded by the South Korean government. Myocarditis wasn’t suspected as a clinical diagnosis or cause of death before the autopsies, researchers said. And another key factor is that, in general, very few autopsies have been done in any country.

Example 2 – A new study released in mid-May indicates the more shots you get, the more you are susceptible to Covid and other diseases because there is harm done to your immune system. Something I and many expert doctors and scientists have been warning about. Now proof is mounting with this independent study that received no external funding, and the scientists indicate no conflict of interest. Of course, it is scientific in nature, but here is most of the abstract that summarizes it.

Increasing evidence has shown that, as with many other vaccines, they do not produce sterilizing immunity, allowing people to suffer frequent re-infections. Additionally, recent investigations have found abnormally high levels of IgG4 in people who were administered two or more injections of the mRNA vaccines. HIV, Malaria, and Pertussis vaccines have also been reported to induce higher-than-normal IgG4 synthesis. It has been suggested that an increase in IgG4 levels could have a protecting role.

However, emerging evidence suggests that the reported increase in IgG4 levels detected after repeated vaccination with the mRNA vaccines may not be a protective mechanism; rather, it constitutes an immune tolerance mechanism to the spike protein that could promote unopposed SARSCoV2 infection and replication by suppressing natural antiviral responses.

Example 3 – A new study recently published in Burns shows a sudden increase in StevensJohnson syndrome (SJS)—a rare and potentially fatal skin disorder. It appears to be triggered by COVID-19, increased vaccination rates, or a lowered threshold (immune response) caused by vaccines or previous infection, according to a large case series. Researchers with the burns unit at Concord Repatriation General Hospital in Australia saw two to four cases of SJS, or toxic epidermal necrolysis, per year prior to COVID-19. In the first six months of 2022 alone, the same burn center observed a seven-fold rise in cases.

Example 4 – Since the shots, disability numbers have skyrocketed in the Fed’s monthly jobs report.

As of June – there are over 4 million disabled American workers. To put this in a numbers perspective — three standard deviations only happen 0.03% of the time, and what we are seeing here is eight deviations and higher. These are called ‘black swan’ events, which are very very rare.

Market analysts Ed Dowd has been tracking this info and he is challenging the medical institutions that make $billions — to investigate the cause. However, most of us have a very good idea of what the cause is.

Example 5 – Under the Freedom of Information act, documents were released by BioNTech to the European Medicines Agency (EMA) in late June. They reveal tens of thousands of serious adverse events and thousands of deaths among people who received the Pfizer-BioNTech mRNA COVID-19 vaccine.

The documents show that cumulatively, during the clinical trials and post-marketing period up to June 18, 2022, a total of 4,964,106 adverse events were recorded, yes almost 5 million. Among children under age 17, 189 deaths and thousands of serious adverse events were reported. According to an analysis by commentator and author Daniel Horowitz, the percentage of adverse events classified as serious was “well above the standard for safety signals usually pegged at 15%,” and women reported adverse events at three times the rate of men. 60% of cases were reported with either “outcome unknown” or “not recovered,” suggesting many of the injuries “were not transient,” Horowitz said.

Example 6 – I pointed out earlier that a Texas Federal Judge in May ordered the accelerated release from the FDA of the Moderna trial data, requiring all documents to be made public by mid-2025 rather than, as the FDA wanted, over the course of about 23.5 years.

Well, the first 15,000 pages or so of data released by DTR add to the growing body of evidence suggesting that the COVID-19 vaccines may not be as safe as advertised.

The pages also included a rat study on pregnancy and fetuses. The findings of this study are troubling. The mRNA vaccine altered the skeletal variations of the rat fetuses, and the “female pregnancy index” of the vaccinated rats was significantly lower than the control group. I could go on with more examples, but I have no doubt that vaccine hesitancy will continue to rise. Plummeting Trust in the narrative and public health sector.

Zero healthy individuals under the age of 50 have died of COVID-19 in Israel, according to newly released data.

“Zero deceased of 18–49 years of age with no underlying morbidities,” the Israel Ministry of Health (MOH) said in response to a formal request from an attorney. The information was sparked by a freedom of information request filed by attorney Ori Xabi, who has been filing several such requests as he seeks to obtain information from the MOH regarding the COVID-19 pandemic and COVID-19 policies.” That only means that what we were told for three years was not true,” he said.

Big Tech firms were asked to censor COVID-19 information that ended up being true, Meta CEO Mark Zuckerberg has assessed. “Just take some of the stuff around COVID earlier in the pandemic where there were real health implications, but there hadn’t been time to fully vet a bunch of the scientific assumptions,” Zuckerberg, whose company is the parent of Facebook and Instagram, said during a discussion with podcaster Lex Fridman that was released on June 8.

According to a report by the Public Health Agency of Canada (PHAC). The report, based on questionnaires with 2,088 Canadians and 16 focus groups nationwide, noted that less than one quarter (22 percent) of those surveyed said they were more likely to trust federal agencies since the pandemic. I wonder why!

In the U.S., a study conducted by Pew Research found that post-pandemic, there was a smaller percentage of Americans expressing the belief that children should be required to be vaccinated in order to attend schools. In prior studies, 82% had supported vaccine requirements, which fell to approximately 70% in the recent report. The report also found that fewer than half of U.S. adults consider the preventative health benefits of COVID-19 vaccines to be high, with a majority also perceiving the risk of side effects as being at least medium.

Overall, 62% of those questioned believed the COVID-19 vaccines’ benefits did outweigh their risks — though this is far below other childhood vaccines, with MMR vaccines seeing support levels of 88%. Conclusion More and more information becomes available that questions the safety and effectiveness of the shots. What is more troublesome is a lot of this information has to come out with court action. What are they trying to hide? It certainly just causes more distrust by the public and more vaccine hesitancy. I expect Moderna has little chance of meeting its revenue targets with Covid-19 vaccine sales, and any other potential products are at least one or two years away.

According to 24 analyst ratings, the average is overweight, with an average target price of US$182.72. However, the average earnings estimates are all negative for the next three years, around -$4/share. There are only two sell ratings, and given the outlook, there will probably be many downgrades. The technical view on the chart looks quite bearish. The stock fell through support around US$115 goes back over two years, and I see the next target around US$70.

The next earnings report is November 2, so if we go with the November 17 put options, we can catch what I expect will be another negative quarterly report.

I like the November US$115 Put for around US$8.50, and it is about US$7 in the money. You could go for more leverage and go with the November US$105 Put for around US$3.00. It is out of the money, but if the stock drops to my target of US$70 by then, it will have a bigger percentage gain than the November US$115 Put.

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Struthers Resource Stock Report Disclosures

All forecasts and recommendations are based on opinion. Markets change direction with consensus beliefs, which may change at any time and without notice. The author/publisher of this publication has taken every precaution to provide the most accurate information possible. The information & data were obtained from sources believed to be reliable, but because the information & data source are beyond the author’s control, no representation or guarantee is made that it is complete or accurate. The reader accepts information on the condition that errors or omissions shall not be made the basis for any claim, demand or cause for action. Because of the ever-changing nature of information & statistics the author/publisher strongly encourages the reader to communicate directly with the company and/or with their personal investment adviser to obtain up to date information. Past results are not necessarily indicative of future results. Any statements non-factual in nature constitute only current opinions, which are subject to change. The author/publisher may or may not have a position in the securities and/or options relating thereto, & may make purchases and/or sales of these securities relating thereto from time to time in the open market or otherwise. Neither the information, nor opinions expressed, shall be construed as a solicitation to buy or sell any stock, futures or options contract mentioned herein. The author/publisher of this letter is not a qualified financial adviser & is not acting as such in this publication.

By JustMarkets

At yesterday’s stock market close, the Dow Jones Index (US30) decreased by 0.42%, while the S&P 500 Index (US500) lost 0.42%. The NASDAQ Technology Index (US100) closed negative by 0.79% on Tuesday.

Moody’s downgraded the credit ratings of several small and mid-sized US banks and said it may downgrade some of the nation’s largest lenders. The agency warned that the sector’s credit strength is likely to be tested by funding risks and declining profitability.

The US dollar may maintain its upward trend, helped by favorable seasonal trends. According to analysts of JP Morgan, the dollar will not suffer from the downgrade of the rating agency’s rating of US debt obligations. According to analysts of the investment bank, the dollar’s prospects are also supported by a favorable macroeconomic situation, including higher interest rates in the US and continued positive US economic indicators. Not only does the US dollar benefit from its reserve currency status, but previous downgrades in the past have not resulted in currency weakness or reduced foreign sponsorship without major domestic events.

Equity markets in Europe were mostly down yesterday. Germany’s DAX (DE40) decreased by 1.10%, France’s CAC 40 (FR40) fell by 0.69%, Spain’s IBEX 35 (ES35) fell by 0.68%, and the UK’s FTSE 100 (UK100) closed down by 0.36%.

German inflation in July 2023 was up by 6.2% on an annualized basis. In June 2023, inflation was up by 6.4% y/y. The report indicates that high food prices continue to have an upward impact on inflation. In addition, the increase in energy prices was again slightly more significant than in the previous two months. Especially noticeable was the dynamics of electricity prices. In July 2023, consumers had to pay 17.6% more for electricity than in July 2022. In June 2023, the growth was 10.5%. Such a significant increase is mainly due to the abolition of the electricity tariff surcharge on July 1.

Disappointing PMI data for the manufacturing sector in Germany and the EU continues the trend of deteriorating fundamentals in Europe. After the single market narrowly avoided a technical recession in the first quarter, the outlook for the euro area remains uncertain. The recent rise in core inflation leads to a scenario that the ECB wants to avoid at all costs: high sustained inflation and stagnant growth. If inflation rises, the Governing Council would have to raise rates or keep them elevated, risking a recession in Europe.

China’s export and import data continues to deteriorate, hitting oil markets. On Tuesday, prices for US West Texas Intermediate crude and UK Brent crude initially fell by 2% after China’s July trade data showed exports contracted at the fastest pace in 3.5 years. However, oil prices returned to positive territory by the close of trading amid renewed excitement over Saudi Arabia’s production cuts.

Asian markets traded yesterday without any unified dynamics. Japan’s Nikkei 225 (JP225) gained 0.38% yesterday, China’s FTSE China A50 (CHA50) fell by 0.16%, Hong Kong’s Hang Seng (HK50) lost 1.81% on the day, and Australia’s S&P/ASX 200 (AU200) gained 0.03%. Most Asian stocks declined on Wednesday as weak Chinese inflation data added to concerns about the region’s largest economy.

China’s inflation rate moved into deflationary territory to minus 0.3% year-on-year. Factory inflation rose slightly to minus 4.4% from minus 5.4% in annualized terms. The decline in consumer inflation is associated with a slowdown in China’s manufacturing sector. Weak economic trends are likely to lead to more stimulus from Beijing as the government seeks to support the economic recovery.

S&P 500 (F)(US500) 4,499.38 −19.06 (−0.42%)

Dow Jones (US30) 35,314.49 −158.64 (−0.45%)

DAX (DE40)  15,774.93 −175.83 (−1.10%)

FTSE 100 (UK100) 7,527.42 −27.07 (−0.36%)

USD Index  102.56 +0.51 (+0.50%)

• – China Consumer Price Index (m/m) at 04:30 (GMT+3);
• – China Producer Price Index (m/m) at 04:30 (GMT+3);
• – New Zealand Inflation Expectations (q/q) at 06:00 (GMT+3);
• – Canada Building Permits (m/m) at 15:30 (GMT+3);
• – US Crude Oil Reserves (w/w) at 17:30 (GMT+3).

By JustMarkets

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.