January 07—11, 2019  FEDHEADS GALORE, I-BANK EVENTS & WARNING SEASON    We thought the Joint AEA/ASSA reached a new high with all the Federal Reserve Bank Presidents speaking but this week will take the cake, especially Wednesday, where I’ve added some asterisks, and noted the speakers will be augmented, besides, by the FOMC Dec 18—19th Meeting Minutes, to be released that day. Thursday is another day of Fed-packed speakers, while Friday promises George, one of the few who didn’t speak at AEA. Meantime, a US Delegation is in Beijing for high-level trade talks that, we hope, don’t end like Trump’s bipartisan talks on the border wall, which even he admitted haven’t made progress. There’s also some confusion about which government data will be released and which will be deferred because of the partial federal government shut-down.

US Nov Consumer Credit (3pm et), out Tuesday, will upset the applecart if growth in revolving debt didn’t grow as much as the Street expects. If consumers waited to charge up a storm until Dec, then some will worry about the bare number, without context—especially since Thanksgiving week and Black Friday are such big days for consumers to spend. Others will worry that banks are trimming the sails of credit card debt, causing shrinkage. Let’s remember the surveys that claimed retail sales rose +5.1% in Dec, so that’s when the most credit (debt) was probably added.
I’d like to get excited about Thursday’s US Dec. Chain Store Sales but few retailers still report those, and a few, like Tiffany, have said they’ll report Holiday Sales, but not this week. Also notable, those FOMC Minutes of the Dec. meeting, out Wednesday because we’ll get more insight into just when the Fed started changing its tune about this year’s interest rate hikes. I suspect 2 more weeks of stiff equity selling into year’s end was what flipped the switch for Powell & Co. US Dec. CPI, out Friday, is likely to dissuade anyone who fears inflation—especially since crude followed equities down, into year end.

CES (Consumer Electronics Show) and NAIAS (North American Int’l Auto Show) are the top Industry events of the week, both likely to be crawling with analysts and execs, both promising 2 days of press conferences before the events, "officially," open. Both include a day for "industryonly." We don’t know why RayJay’s calendar states it is hosting meetings at ICR Conference on Jan. 7th & 8th, since the public company conference doesn’t start until the 13th, and the private company section until the 16th. Was it a place holder based on year ago information? We have no idea but there it is, on RayJay’s 2019 calendar, starting the 7th. Maybe we’re wrong and Raymond James has set up meetings with corporates presenting, for the week prior to the conference opening. It’s just not the way it usually occurs, and plenty of other I-banks are sponsors, all of them hosting meetings during the ICR Conference, mostly the 14th—16th, rather than a week prior. On the corporate side, the big Kahuna of I-bank events is JPMorgan’s Annual Healthcare Conference, in San Francisco. There are at least a half dozen Healthcare events scheduled to coincide, the most coveted by Leerink Partners. JPM can also boast of it’s Tech Forum, @ CES, and Citi of its TMT @ CES, while Goldman Sach’s Energy Conference is a headliner, too, especially for its Miami location, just as another deep freeze is supposed to sweep from the West Coast to the East.

If the National Banks of Eastern European Countries are an interest, then UniCredit has the Emerging Europe Winter Conference designed for you. In Kitzbuhel Austria, it’s hosting officials from the National Banks of Hungary, Romania, Poland, Czech Republic, Russia, and Turkey, plus the FinMins from those countries and more.

On the other side of the globe, Citi is hosting a 7-day Nationwide (China) Luxury & NEV {sic} Dealership Channel check that starts in Shanghai on the 11th, moves to Nanjing/Suzhou/Wuxi on the 12th, then Beijing on the 18th, Tianjin on the 19th, Shenzhen on the 26th, and Shenyang from 02/01—02, in Mandarin, only. Deep dive into this week? On the 11th Citi will be visiting dealers of BMW, Benz (Citi’s terminology, now ours), Audi, GWM (Wey), Geely (Lynk&Co), BYD, Hyundai. I’d protest that the hi-level "ministerial-level" trade talks will be much more significant for sentiment, at a time Trump really needs a win, and China needs to boost its economy, suffering from US Companies limiting the orders placed there. For China, the biggest risk is apparel & shoe companies finding alternate manufacturing in Vietnam, Cambodia, South Korea, Latin America, and elsewhere, and permanently moving some of their production away from China. The longer the trade stalemate endures, the more companies will diversify their production away from China—never to return.

I’d also tune into the American Farm Bureau Federation Convention and IDEAg Trade Show, starting Friday, because those were some of Trump’s biggest supporters, his big idea to spend $12B on grants to farmers, to keep their support, as China cut back on orders of soybeans and other farm products. I’d be surprised if Farmers could be bought for so little, and question why no opponents are questioning the legality of the White House farmer bail-out, whe3n other industries aren’t getting the same soothing.

Earnings from KB Home & Lennar will be watched carefully, though Constellation Brands (STZ) is reporting a quarter that ends before the bulk of holiday alcohol & wine sales kick into high gear but, still, with beer often a working man’s drink and employment at some of the highest levels in decades, we can’t say there’s nothing to be learned from STZ’s report. Likewise, Synnex (SNX) is an Enterprise supplier of technology and integration services, so one to watch, especially since last quarter it reported its first disappointment in years.

I’d also keep a sharp eye on England and the EU, since the Brexit deal Prime Minister May negotiated seems less likely to squeak through Parliament. In fact, there’s more talk, of late, of the current status being extended for a period of time while negotiations continue. Many in the EU are dead set against such a result, and I sure don’t want that to happen because I’m eager to buy British stocks, selectively, into the March 29th Brexit date. For instance, Tata Motors is almost 1/3 of its 52 week high, while oil is so soft, the foreign E&P stocks are suffering more than, say, Chevron, while Royal Dutch Shell "B" shares are design, specifically, for US investors, who won’t have UK taxes taken out of B share dividends, never to be reclaimed again, without great expense.

How this week turns out could well depend on Earnings Warnings—how many as well as how big the miss. None may be as damaging as Apple’s but enough of them would certainly do more widespread damage. Stay safe out there—I’m not at all certain that the selling is over—and can’t readily say the opposite with any confidence, either. The charting program I’ve long used suddenly won’t accept any dates past December 31, 2018. 2019 data comes in but isn’t being integrated into my charts. That means I need to start fresh, with a new program, this week, and pray it won’t be as painful as some new programs were to use. I still have nightmares of my dad upstairs, on hold for tech support, back when "small" business computers took up an entire room that required their own punch cards and air conditioners. Now that’s a nightmare!

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2019 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in complete due diligence.  

December 17—31, 2018   WILL FOMC ESTABLISH the POWELL PUT?   For years, traders talked of the Greenspan Put, then the Bernanke Put, and the Yellen Put. There are so many expecting the FOMC to back off its former dot.plot projections to establish the Powell Put, even though they’re not yet labeling it that, yet. (You can be sure they will if Powell & his Merry MPC disciples back off next year’s 3—4 rate hikes. These optimists are even predicting an end of year rally that could recover as many as 1k DJIA points by the end of the year.

Then, there are the economic purists, saying there’s nothing wrong with the economy except what the markets are endanger of talking into the economy. They believe the FOMC will stick to its previously laid out rate trajectory, let the stock markets fall where they may. I don’t necessarily believe Powell will ignore the pain the equity markets are inflicting on investors and retirement accounts but I don’t see things playing out the way either the bulls or bears expect. Rather, I think Powell will re-emphasize how data dependent the rate setters are, willing to raise if the economy demonstrates continued unsustainable strength or latent inflation, and ready to hold off if stock market weakness, a slowing global economy, or any combination of factors cause the US economy to slow. Of course, if such a scenario prevails, then both bulls & bears will declare victory, markets will rally for a few hours, then fall back again as shell-shocked investors use strength to unwind.

The foreign banks whose Living Wills are due on 12/31 include Banco Bilboa, Vizcaya Argentaria S.A., Banco Santander S.A., Bk of China Ltd, Bk of Montreal (aka BMO), BNP Paribas, BPCE, Cooperative Eabobank U.A., Credit Agricole S.A., HSBC Hldgs Plc, Industrial & Commercial Bk of China ltd, Mitsubishi UFJ, Financial Grp, Mizuho Financial Grp, Royal Bank of Canada (aka RBC, ticker RY), Societe Generale (aka SocGen), Standard Chartered Plc, Sumitomo Mitsui Financial Grp Inc, Bk of Nova Scotia (BNS), The Norinchukin Bank, Toronto Dominion Bk (TD Bank). Also 2 domestic lenders must submit their plans, CIT & Citizens Financial Group.

Other than that, the next two weeks will be all about bond rates & action in the equity markets. I don’t necessarily expect the markets to string together 2 winning days in a row before 12/27. Then again, I’ve been wrong about the FOMC some 97% of the time--dead wrong. Therefore, the bulls should not yet give up on their optimistic expectations. I’m quite willing to be proven wrong again, even though I’m not expecting this FOMC to establish the Powell Put--not before his first year is out in February, at any rate.

Merry Christmas and a Happy, Healthy New Year

ECONOMIC: (Highlights, only, below. Full International Economic Calendar Here) SEE FULL INTERNATIONAL ECONOMIC CALENDAR THROUGH January 4th 2019

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

December 03—07   DAY of MOURNING WILL BREAK THE MOMENTUM, No Matter the direction   Sunday, I imagined retailers around the country popping champagne. A day off during the week for a national day of mourning is like an extra weekend day during the height of the holiday shopping season. Macy*s, which just sent out oversized postcards and newspaper circulars for Friends & Family 30% off—even 15% off cosmetics—caught a tremendously lucky break, a 10-day special discount at a time no one else is has a competitive offering, and the country taking a holiday mid-week, just as the coupon is making the rounds, and fresh in everyone’s mind. And for those, like me, who don’t recall the NYSE grinding to a halt for a president’s funeral, a wise friend, Barbara Rockefeller, who runs Rockefeller Treasury Services sent me a clip from CNN, that stated, "The NYSE has traditionally closed for all or part of its session for the funeral of a US president, including in 2004 following the death of Ronald Reagan and in 1994, when it closed for the full day for Richard Nixon's funeral." How Nixon was honored after being run out of office in disgrace is a head scratcher if there ever was one.

Unfortunately for the I-banks who were responsible for making this one of the heaviest weeks of investment conferences, the turn-out is suddenly in question. Any portfolio manager (PM) attending a conference can be more relaxed than usual, Wednesday, with stocks not trading but the logistics for some beg the question: Is it worth schlepping in, from Connecticut, let’s say, just for the conference, when I can hear the companies make the same comments streamed via whatever service the I-bank is using? On the other hand, those attending out of town conferences really catch a bonus—the kind of bonus any PM feels when allowed to relax because the markets are closed.

And, you might note, the Economic Calendar is filled with central bankers talking up a storm on both sides of the Atlantic—some for the last time until next year. Most interesting of all may well be BoE’s Carney testifying (Tues.) at Britain’s Parliament on the consequences of not approving the Brexit deal Prime Minister May negotiated. I don’t buy the most dire of consequences being tossed around, in an effort to convince the members to vote for May’s deal but, then, it’s all part of the drama that led to one of the biggest one-day sell-offs in history, when the UK voted for Brexit. Even ECB"s Draghi is speaking this week (Tues.) in Frankfurt with fellow MPC’s Noury, Lautenschlager, & head of the EBA (European Banking Authority), Enria.

On this side of the Atlantic, I’m not really certain about which data will be pushed out to Thursday but one would have to assume that anything coming from the Federal Gov’t isn’t going to arrive on Wednesday. But it’s really only the EIA Petroleum Report, Wednesday, that should be pushed out until Thursday. Ditto the Fed’s Beige Book which had been scheduled for 2pm et. But, then, FOMC Chairman Powell was supposed to testifying before the Joint Economic Committee of Congress, @ 10:15am, that will have to be rescheduled—day and time to be determined, even as the year is winding down—House & Senate members getting out of town, even as another Continuing Resolution is needed to fund the government, past Friday. Powell might have been considering, possibly, tamping down some of the enthusiasm he stirred, last week, by claiming that rates are, now, just below neutral. It isn’t every week that the DJIA rises 1,200 points or more. But clearly, his testimony will be moved. It won’t happen on Wednesday while Pres. Bush’s casket lies in state.

So, what we know, instead, is that Canada’s Monetary Policy Committee will meet on rates. OPEC & Non-OPEC Oil producers will have met on new quotas; Federal Government funding runs out on Friday, when Medicare recipients must, by midnight, name their new supplemental insurer of HMO, and a Prescription Drug Plan (PDP). And, as if all that wasn’t enough, November’s Unemployment Report is due, Friday, just as the largest lay-off announcement in years came from GM, 14,600 jobs cut. Is that a turning point? We’ll know only with the fullness of time. But it is the kind of announcement that many won’t forget.

Earnings will come from consumer discretionary companies more than any others. Yes, Broadcom, Hewlett-Packard, and Marvell Technologies are reporting but, for the most part, it’s all consumer-related names, only Hovnavian & Toll Brothers with the power impact their sector.

Which brings us to Events. UBS’ 46th Global Media & Communications (NY, Mom.), Bk of America Merrill Lynch Leveraged Finance (NY Mon.), Technology Investors from Raymond James, Tech Services from Wells Fargo both start Monday. But, Wells’ event in Deer Valley, UT is just the kind of place you want to be if you’re a skier, and the markets are closed an extra day. Also interesting, Monday, Macquarie’s Asia Internet, Media & Education Conference—Tomorrow’s World, is taking place in NY. That makes it a whole lot more accessible. Leerink’s Devices & DNA has some competition, in the form of ASH, still ongoing, Amgen broadcasting an investor meeting from the event, Monday night. In fact, if you want to grasp a good sense of how much is being squeezed into early December, before vacations start, you need do little more than peruse the Event Calendar for Monday & Tuesday. The highlight of Tuesday, Goldman Sachs’ U.S. Financial Services, and Barclay’s Eat, Sleep, Play—it’s not all Discretionary Conference, in NY. In fact, Eat, Sleep, Play sounds like a movie starring Julia Roberts or Meryl Streep. Then, again, one can ask what Credit Suisse’s European Business Services Conference is doing taking place in San Francisco. (Is it some sort of matchmaker attempt to stir up M&A?) Meanwhile Nasdaq’s 39th Investor Program is in London, starting Tuesday, as are Bernstein’s Strategic Decisions, Credit Suisse’s Specialty Chemicals, & Citi’s Consumer Conference.

All in, the calendar is extremely busy, even if the markets won’t generate the kind of frenzy this week, it managed last week. Sure, last week’s huge rally stole thunder from this week’s post-Xi/Trump meeting 90 day tariff truce. But is there anyone who didn’t believe that a postponement of the January hike in tariffs from 10% to 25% was coming, no matter what? Any momentum in one direction, or another, will be broken by the Wednesday holiday. But the 90-day truce should be enough for some of the tech hardware companies to recover, a bit. And an extra weekend-like day for holiday shopping, Wednesday, should offset any bad news that might arrive with this week’s earnings reporters. On the bright side, however, rates have been slithering down, since the summer’s high, which might be just what the homebuilders ordered. The stage has been set for upside bias into the end of the year. The serious rally I expected after the Trump/Xi meeting happened last week, instead. There may be some payback this week, before the rally finds more legs into year end.

ECONOMIC: (Highlights below, only. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should just one factor in more complete due diligence.

November 26—30, 2018   MARKETS TILT TOWARDS THE BEARS  It is very rare for there to be a full week in November, after Thanksgiving. That’s helping many sellers—whether car dealers or retailers—keep an optimistic outlook on top of the fact that unemployment is so low, and wages are rising, however reluctantly. But there’s also a problem ahead. Early this year, one company after another announced bonuses for workers, citing the Tax Cut & Jobs Act passed in December 2017. For many workers not normally eligible for bonuses, that extra cash made it a lot more enjoyable to buy gifts—and self-gift—with the extra money. The vast majority of those bonuses were one-time events. Come January, when credit card bills arrive, most will find no extra cash to pay for their largesse (or excess). That is likely to create pressure, early in 2019, that even timely tax refunds won’t necessarily alleviate. Who will cry the blues most? In all likelihood, low end retailers and those in malls. (Here’s an old theory that doesn’t work for people who, now, shop mostly online: ‘If you stay away from the mall you won’t be tempted by discounted merchandise.’) And who does the modest wage gains benefit the most? Dollar stores, even more than Walmart, Target or Kohl’s. And not to play the party pooper, but this past Saturday, the mall was the quietest Saturday after Thanksgiving I’ve ever observed, and I’ve observed more than 40 consecutive post-Thanksgiving Saturdays, 28 of them at Town Center Mall in Boca Raton FL.

Besides the fact that almost every retailer posted signs promising 40% or 50% of "entire store," and many offered an additional 50% off all sale merchandise, most of the stores boasted "Black Friday held over, today." Crate & Barrel offered 20% off all holiday-related merchandise, and surprised with some unique items, like tents fashioned and screen printed to look like a B-B-Q stand, or camper, it’s the discount that surprised the most. Crate & Barrel was somewhat of a late comer to the mall, probably around only 18 years of the 28 I’ve been here. And it started in a smaller leasehold, and moved to a much bigger one, which it occupies today. I have seen Crate & Barrel discount "seasonal" merchandise by 20% only after Christmas, and not move to 50% off remaining seasonal merchandise until February. But I’ve never before seen it discount seasonal offerings prior to Christmas. Furthermore, if you can get your hands on a copy of its holiday catalog, I think you’ll be shocked at how LITTLE it’s asking for some of the items pictured—one of the most expensive home stores suddenly offering fancy items at value prices.

Here, the only stores that sold overcoats, in the past 8 years were specialty stores, like Abercrombie & Fitch, which offered the same lined "puffer" jackets with fake fur collars year in and year out. This year, suddenly, Macy’s & Nordstrom offered over coats—JWN the biggest surprise, since it started carrying only lined and unlined raincoats, as of about 6 years ago. This year, a couple of racks of wool coats took me by surprise so I asked about their return. "We didn’t order any, initially. But once the3 weather finally coole3d here, and the country experience the heaviest and earliest snow in years, we gathered a few from Orlando, a few from Atlanta—all around the country we had stores send us their back-ups from their stock rooms, so we’d have a r3easonable collection to sell. M brought in some from other stores, too, but didn’t bother to make sure it had a well-rounded collection in a range of sizes. At ANF, the men’s puffer coats were getting more browsing and trying than any other areas in the store, the same coats, once again, revived for another winter. In fact, despite record highs on Saturday, topping out above 87 degrees, and high humidity, college kids home from the holidays were busy trying on ANF’s coats. And, because it nags at me, I must mention there are no "puffer" coats—they’ve lined quilted coats. It’s analysts who, years ago, invented the "puffer" moniker which made its way to store managers and, ultimately, to ads & rack toppers in stores.

We’ve all heard a lot about malls and stores doing more to make sure their locations attract millennials, who are accused of shopping almost exclusively online—mostly on their phones. Does that explain the French/Italian cubby hole or restaurant that was replaced, in recent months, by a hot dog stand? Is it the reason Santa’s photo-taking workshop, this year, ditched green & red décor in favor of green & lime décor, with not a bit of red showing except the uniform on Santa? And I can’t round out my comments on the mall without pointing out the collapse in traffic at Michael Kors dept at Macy*s, as well as at its own store? I can understand shoppers avoiding the KORS store, since it didn’t have a single sale sign in its windows. But at M, there was a decent selection of KORS bags at 30% off, and not a single shopper in the department. In years past, there were lines of people waiting for help (the possibility of a fresh bag in its original packaging, in the store room), or to pay. Many of the KORS shoppers at M were Asian, and at the KORS store were men hanging over the glass-enclosed watch display. This year, not a soul was seen at either place. In contrast, Not only was Tapestry’s Coach division, at M, offering 30% off some small accessories but I found an turquoise wallet with attached key ring, reduced from $178 to $23.93, which I snapped up on sight. No, I couldn’t use any additional M percentage or dollars off coupons but I was OK with that. I might even keep that wallet for myself, given the color is my 4th favorite, and perfect for someone who can no longer wear a shoulder or cross body bag. No I’ll, also, mention that the wallet was the biggest bargain I saw ALL day, and the only Coach item that steeply reduced—perhaps companions flew out the store on Black Friday. But the amount of Coach items offered at a discount were the fewest I’ve seen in the past 5 years.

And so it’s said, there are the maximum number of days possible between Thanksgiving & Christmas, plus early frigid temps & heavy snows helped left more people feeling like winter is here, and they don’t’ need to look for swimsuits to get through another warm winter. Still, 2017 was a 53-week year, and this year is 52 weeks. Plus, there was no opportunity to sell overcoats and boots at full price, because most retailers went to 40% or 50% off for Thanksgiving, earlier than they should have, given the weather. Retailers are their own worst enemies. The only chain not offering gigantic discounts is Nordstrom but that just makes it hard for it to sell. Additionally, with Macy*s, Bloomingdale’s, Saks 5th Ave, & Neiman Marcus offering steep discounts—just as JWN’s vendors were doing in their own mall stores, JWN was forced to price match discounts on tons of items. As a former retailer, I can state unequivocally, it’s the worst business to be in right now—no matter how strong one’s digital sales may be.

So let’s go back to the Economic Calendar a minute, to note the Sept. & Oct. housing data that is scheduled to be released. It’s really the number of Central Bank speakers that knocked my socks off. In Europe, it’s members of the ECB, including Novotny, & Couure plus Draghi, by Monday Morning, when BoE Gov Carney is holding a discussion with former FOMC chief Alan Greenspan, which will be moderated by The Economist editor, Wooldridge. After he’s done there, he’s hosting an online Q&A on the Future of Money. But the event that takes the cake is The Clearing House Annual Conference, starting Monday, w/FDIC’s McWilliams, Fed Presidents Bostic. Evans & George, as well as Fed Vice Chair Clarida, and many bank CEOs (NY 26th thru 28th). Also Monday, ECB’s Mario Draghi testifies at the European Parliament Economy & Monetary Affairs Committee (Brussels). Tuesday, Clarida keynotes day #2 the Clearing House, while Bostic, Evans, & George are panelists on "Financial Innovation, the Economy, Regulation & the Future of Payments,".w/Q&A @ 2:30pm in NY). Of course, Tuesday, the Street may be more interested in the S&P Case Shiller Sept 20-City Home Price Index & FHFA’s Sept House Price Index, or even the Conference Board’s Nov Consumer Confidence though, as I’ve long argued, consumers often consume the most when they’re feeling their worst. It’s what we saw after 9/11, and many other times. Then, again, the $40B in 5-year Notes the Treasury will offer, Tuesday, might grab the spotlight, depending on how well it goes.

Wednesday, another guesstimate of Q3 GDP will be released, along with the associated information contained within, including Personal Consumption & Business Investment. We’ll also get the Oct International Trade Deficit, a 2nd look at Q3 Corporate Profits, and Oct New Home Sales, along with the EIA weekly Petroleum/Gasoline/Distillate Report, along with FOMC Chairman Jerome Powell speaking at the Economic Club of NY. I don’t believe the ECNY streams speakers, live, but even if it did, Powell is likely to be a lot better prepared—or at least less glib--than he was on October 3rd, when he spoke of rates being "far from neutral," which is said to have launched the trillions of dollars of losses the major indices suffered in that month. Also speaking Wed., FDIC Chair Jelena McWilliams, whose keynote of the Clearing House’s day, a day in which we’ll also watch how the Treasury’s $32B 7-year Note Auction goes, along with the FOMC Minutes of the Nov 07—08 meeting, at which the board took a nothing done.

Even more unusual, is the 1st ever release of the Fed Reserve Board’s assessment of Financial Stability Conditions in the US (4:30pm). Almost every other major economy’s central bank has for years published a Financial Stability Report—the BoE’s report scheduled for release earlier Wednesday--but, until now, the Federal Reserve Board of Governors has been the outlier for not publishing one—though it hasn’t operated with all seats filled in years, until recently. It’s almost too bad that such reports weren’t published in the Greenspan years. Imagine how inscrutable they would have been. The Board of Governors are, now, correcting that oversight. Starting on Nov. 28th, at 4:30pm, the Federal Reserve Bank Board of Governors will publish their first of what will become a semiannual report on the Board’s assessment of financial stability conditions.

Other unusual items on the Economic Calendar include the Norges Bank (Norway) discussing its Wealth Fund (Oslo, before we wake on Thursday). For only the 2nd time, CEBRA holds a conference—the Central Bank Research Association, an Int’;l finance & Macroeconomics programme [sic] that will examine "Risk, volatility, & Central Bank Policies (Madrid Spain). In Frankfurt, the ECB, Federal Reserve Board, and Fed Reserve Bk of NY host a Global Research Forum also on Int’l Macroeconomics & Finance, but in Frankfurt. CFTC Chairman Giancarlo is keynoting a Financial Stability: Markets & Spillover Conference in D.C. that’s co-sponsored by the Fed Reserve Bk of Cleveland. even as Fed Pres. Mester opens the conference with "Collaboration for Inclusive Economic Development: A forum for Philanthropies, policymakers & practitioners," w/Q&A, at the Boston Fed Bank., where Fed Pres Evans is a panelist. NAR Oct Pending Home Sales are expected the same day, Thursday. Overnight, it’s data out of China that will be a focus—the Manufacturing, non-manufacturing & Composite PMIs.

Now recall, the G20 Sherpas & Partners start meeting in Buenos Aires, on Monday, the 26th, but it’s not until Friday that the Leaders Summit starts, with a speech by Argentine Pres. Marci, that will be streamed on YouTube, per the link provided on the Economic Calendar, (which you should really peruse yourself, via the link provided). Ironically, NY Fed Bank Pres Williams won’t be attending G20 but, instead, on Friday, will be a panelist at the 80th Plenary Meeting of the Group of Thirty (G30), at 9am, in NY. At some point either Friday or Saturday, US Pres. Trump is supposed to meet with China’s leader, Xi Jinping, to at least open a dialogue on trade & tariffs. Which brings me to what I think is the biggest error Trump is making.

The Earnings Calendar is filled with smaller retailers than those that have already reported their earnings. What they do have, that prior reports didn’t, is information on how Black Friday and the rest of the holiday shopping went. I though Saturday was so slow that, even if Friday was a blow-out, a good portion of Black Friday’s gains were offset by an unusually slow Saturday after Thanksgiving. In addition to the retailers reporting, notable reports are expected from a couple of big Canadian banks, and a few tech stocks of note, like Salesforce.com & Nutanix on Tuesday, Box & Weibo on Wednesday, Ambarella, Hewlett-Packard (consumer), Palo Alto Networks, Tech Data, & VMware Thursday.

And then there are Industry & I-bank events, which constitute a last rush before the Christmas holidays bringing everything to a halt. Headline events include Credit Suisse’s 22ndf Annual TMT Conference, in Scottsdale, worth going to for the stay at the Phoenician hotel, alone, even if it didn’t promise every tech company one can think of. Also Monday, the Press & Industry days at Los Angeles’ Autoshow, Citi’s Basic Materials, Goldman Sach’s European Industrials, and the aforementioned Clearing House & BPI (Bank Policy Institute) Conference. Also Monday, Amazon’s AWS annual developer, integrator, and global Partner event, in Las Vegas.

Tuesday, Goldman hosts Global metals & Mining, while Scotiabank hosts the Canadian version, in Toronto. Credit Suisse hosts Industrials in Palm Beach, Jefferies Energy in Houston, while both Evercore ISI & Piper Jaffray host HealthCONx & Healthcare conferences, respectively. NADA & J.C. Power host a one-day conference at L.A.’s Automobility, while ICSC—the Shopping Center Council—hosts Centerbuild, even as JPMorgan will present the 2019 Fixed Income Markets 2019 Outlook, and Agricultural Retailers Association hosts its annual conference.

Wednesday, beyond Powell’s speech at the Economic Club in NY. Deutsche Bank hosts Gaming, Lodging, Leisure & Restaurants, a 1x1 in Miami Beach. Cowen, however, could be hosting the event of the year—a Cannabis Summit in Boston. Unless I’ve forgotten another one, I believe Cowen’s is the first serious I-bank marijuana event in the US. Paris France is where SocGen will host The Premium Review, one of the best known, annual, European-hosted Conferences. Friday, SunTrust will also host Lodging, Gaming & Leisure Summit, with presentations instead of the 1x1 Deutsche Bank chose. ASH opens Saturday—the American Society of Hematology, one of the biggest medical society meetings of the year. Analysts will be talking about it all week.

Thursday, the FOMC Minutes, I fear, could sound more hawkish than markets want. Because October so often produces negative returns that are, then, reversed in November, it’s possible the FOMC came out of their meeting believing stocks would rebound before November was over. Instead, stocks kept going down, with no end in sight. It’s quite possible that the FOMC would write different minutes, today but they don’t go back and rewrite what they signed off on 6 weeks ago, so expect to read very hawkish minutes. And, unfortunately, a combination of Trump trying to pressure the FOMC, which they could feel compelled to resist loudly, with actions & words, along with the long-held determination to raise rates in Dec., to boost rates to neutral, so they have something worth cutting, when the next recession arises, puts the FOMC in a precarious position. Raising rates in Dec. on the 19th, while toning down their minutes of that meeting. In the alternative, Powell could change his tune as soon as December 5th, when he testifies before the Joint Economic Committee of Congress.

But before that, we’re likely to suffer more boasts from Pres. Trump. While he likes to sling a lot of B.S., tout his prowess as a negotiator, and lay claims to successes that never occurred, he has misjudged Xi. Even if current tariffs were seriously hurting China’s Economy, Xi must save face against all costs. He will not just roll over, I don’t personally think, even in the presence of Trump’s threat to boost the current 10% tariff on $200B in goods, to 25%, as of January 1st, 2019. If Trump wants the Federal Reserve to back off rate hikes—even lower rates—just wait and see what inflation will look like if tariffs go from 10% to 25%, which manufacturers and retailers will be in no position to absorb, even if they wanted to. How does the Federal Reserve fight inflation? Just like other central banks do—by raising rates.

So expect Trump to announce "great" talks with Xi, even as the Chinese deny any progress has been made—and reiterate their position that China can’t be bullied into changing its policies because some outside force wants it to. Given my strong feeling that China & the US will be no closer to resolving the trade differences, after the two leaders meet in Argentina, it should come as no surprise that I think the bear market in stocks since October 3rd, has only just begun. At the least, the longer Trump is President, the less people and markets believe his bluster—in the absence of confirmation from his counterparts. Instead of a Santa Claus rally, it could get very ugly in the US markets, just as China’s markets have already assumed. Technically, stocks have already entered a bear market. If Trump can’t find a way to back off his demands of China, the future will be filled with coal for US markets, the rally that often occurs between Christmas & the end of the year, into the first 5 days of the New Year will be MIA. Markets already tilt towards the bears, who’ll probably be licking their chops on any pop in stocks, no matter how slight. And don’t forget it’s month’s end, besides, putting more pressure on Wednesday.

ECONOMIC: Full International Economic Calendar here:

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

November 19—23, 2018 
ENJOY YOUR TURKEY   It’ll be a quiet week as desk jockeys turn into travelers, making their way to family, friends or wherever they plan to spend the holiday. At the malls, mostly college kids already home for the holiday are making their way to the mall—not so much to see what’s already on sale as to meet up with their other local friends home for the holidays. That’s not to say no shopping is going on, there is but just not to the extend some might hope. An early snow in the north east should have been a boost to sales of coats, hats and gloves but, for the most part, items like that aren’t even sold, here, anymore. There’s been just too little demand over the last few years for any stores to bother. Those, like Abercrombie & Fitch, with overcoats on display are featuring the same ones they’ve been selling for 8 years or more.

As I’ve watched Apple’s stock go down nearly daily since it reported earnings and, Oh, by the way, say it would not longer divulge number of devices sold, I keep thinking of the recent IPad & MAC unveil and wonder whether traders are missing the forest for the trees. I agree in principle, that Apple made a tactical error when it bet that the Street wouldn’t mind, all that much, if it stopped providing the number of devices sold, since ASP for each device sold is more important to its earnings and margins. And, I’ve listened for a few years as analysts talked up the coming services revenue, that will grow to the moon and make the stock worth its multiple, on its own, though services revenues have 2x missed estimates. But, really! What about the new tablets & Macs, just as both IDC and Gartner say PCs are selling more strongly this year than in recent years past?

Last week I said I thought enthusiasm was too high for the recovery in mall traffic & store sales. That surely proved the case last week, as even those that beat the street fell aft3rer reporting. Then, there was Nordstrom that decided to refund 28c to credit card holders who were overcharged interest. These, mind you, were delinquent credit card customers. Unless the funds from the refund came from a 3rd party—say an insurance company—refunds now made Instinet analyst Siegel worried which prior quarters were wrongly boosted by that extra interest charges. With off-price and small retailers dominating earnings, this week, expect a more mixed earnings week.

And don’t expect bulls or bears to manage any conclusive trading, this week. In fact, no matter who wins the weak, discount the results as low-volume skew.

Have a very happy holiday. If you’re a guest of someone else, be very glad you’re not responsible for cooking—it’s very hard work that takes hours to pull together.

ECONOMIC: (Highlights, only, below. Full Int’l Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

November 05—09, 2018  
BULLS NOT IN THE CLEAR—More like MIA     I believe equities would get off a rip roaring rally if Republicans keep both houses of Congress but that won’t last till year end. Instead, the charts suggest there’s more work to do on the downside—at the very lease, a retest of recent lows, or something relatively nearby. Friday’s pop and drop on a strong October Unemployment Report, is exactly why—the Fed has every reason to stay the course on quarterly rate hikes as long as the economy is performing that strongly. Granted, companies more typically reported Earnings above consensus even as revenues missed. That’s exactly what one would expect of Earnings goosed by lower tax rates which aren’t going to boost the top line, at all, initially. If companies are planning on bigger investments because of accelerated capital deductions, those are things that take some time to tee up. Earnings, on the other hand, are goosed by lower tax rates, alone, no matter what happens with revenues.

Any pretense of a quiet period around Fed or other Central Bank meetings is dispelled with this week’s Economic Calendar, on both sides of the ocean. The FOMC, as it turns out, is meeting Wednesday & Thursday, instead of the usual Tuesday/Wednesday, supposedly because of the Elections on Tuesday. (That seems to mess up NY Fed’s Williams, whose scheduled to be at both the FOMC meeting while, also, opening the NY Fed’s "Investing in America’s Workforce Book Launch." I can’t say I’m feeling particularly bullish about the prospects for the 10-year Treasury Auction, Tuesday, or the 30-year Bond Auction, Wednesday, small though both of them are. I’m not sure it makes a difference to anyway if the RBA raises rates, or not, Monday night, out time, but if China is slowing, it should show up in Aussie sales of materials & metals, given its proximity to what used to be a vacuum for such products. If a China slowdown is seeping into Aussie sales, the RBA is more likely to hold its arsenal. Of course, by the time the RBA announces its decision, the mid-term Elections will be well underway, projections on the results held until polls close. IF markets care little about what the RBA does, they care even less about New Zealand’s central bank decision on 11/08 local time, very late Wednesday night in the
US east. Perhaps the only part of the Economic Calendar is tied to items on Wednesday’s calendar—the EIA weekly Petroleum, Gasoline & Distillates release, where perhaps the latter 2 react to last numbers issued (for 2 weeks ago) by falling, and crude supply falling as well after 2 weeks of builds. And that’s possible because 2 areas hard hit—the Carolinas & Florida panhandle—are slated to normalize, after wicked storms that flooded the former and leveled the latter.

The Earnings Calendar is rife with another slew of hotels, smaller restaurants, and some bigger suppliers to homebuilders, along with a handful of tech companies that might help settle the questions about Q4 left by Apple, Western Digital and other mega size tech companies who didn’t sound particularly optimistic. If I’d noticed, sooner, I probably would have highlighted all the smaller media companies set to report, especially radio companies whose numbers built up while I was noticing other sectors.

Sunday, the National Association of Realtors meets in Boston, the NAR of "Pending Home Sales" we get a peek at once a month. Sunday, I hope everyone snagged an extra hour of sleep, as the clocks were turned back, so soon kids can leave for school in the dark, and return home after school, in the dark. Europe decided to stop moving its clocks, twice a year, but won’t start the new scheme until after next year. Note the Bk of America Merrill Lynch Future of Financials Conference in NY, because every bank you can think of will be there, though it appears the event will keep BAC from presenting at BancAnalysts Ass’n of Boston Fall Conference, starting Wednesday, that will look a bit like a carbon copy of BAML’s Future Financials Conference. JPMorgan, Monday, is hosting Global Oil & Gas in London, while Hart Energy is hosting Oil Executives, in Texas, starting Monday, too. Oddly, Investment Advisor & broker-Dealers meet for a Compliance Conference, the same day, even as Hedge Fund Investor Summit start that day, too.

Tuesday, Citi hosts meetings at NAREIT’s REITWeek, as will other I-banks as the week goes on. Remember when REITs were taken out of the Financials Index, and put in an index of its own? That was September 2016, and it was all downhill for the group, for a long time afterwards. Only over this past summer did REITs start to regain their footing, as optimism about brick & mortar retailers picked up. Now, S&P has move Facebook, Netflix, Alphabet/Google & media companies like Walt Disney (reporting this week) into a new Communications sector, and the momentum names that looked so promising, when State Street released the XLC ETF to mirror the new index, instead pulled a REIT dive, and haven’t recovered, yet. All of which makes the Stephens Fall Investment Conference, in NY Tuesday, a bit unique, as it holds out a truly extensive & comprehensive list of presenters from restaurants BJRI, CHUY, DFRG, EAT, DENN, DPZ, RUTH, SAFM, to vehicle retailers AN, KMX, GPI, CRMT, ABG, PAG, & SAH, to transports AAL, JBLU, FDX, GWR, GATX, KSU, UNP, YRCW, R, RMAX & RLGY and so much more. Note, also, ARDA Resort Development Ass’n annual, Wednesday, more financials, as PiperJaffray hosts a Western Bank Symposium—investment banks back in Conference form, as the majority of the S&P has already reported earnings, leaving only retailers to weigh in next week—not even this week.

Given the carpeting of political advertisements—everywhere but especially on TV, there isn’t a single person who won’t be relieved to see the Mid-terms over, Tuesday. But an unexpected benefit seems to be the "Telethon for America," w/Julia Louis-Dreyfus, Amy Schumer, Jane Fonda, Judd Apatow, Chelsea Handler, and too many others to name, starting 9pm et, Monday, on YouTube, and the websites of Facebook Live & Comedy Channel-- pure entertainment (no money raising) to encourage people to vote the following day. That’s something I think we can all get behind, except, perhaps, some of the most ardent liberal haters.

I highly recommend viewing whatever charts you look at on both a weekly & monthly view, rather than the daily view. It is only on the longer term that the full extent of the damage done can be seen for what it is—ugly, a big "V" recovery not in the cards. Then, review the many companies that delivered bottom line results but missed on the top line, because the full benefits of the Dec. 2017 Tax Cut did that for companies this year, but won’t next year. The stock market is a forward discounting mechanism, and it’s got it right. What lies ahead is not nearly as bullish as what happened until October’s harsh decline. Now is the time to lighten up on rallies, not buy the dips. Unless, of course, you’re a republican, who gets what they want on Tuesday, in which case the liberals will cry into their milk but be happy to short the heck out of the stocks republicans buy.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

October 29—November 02, 2018  EARNINGS STILL DOMINATE   It might feel like Earnings are winding down but that’s far from the case. And it’s not just the sheer number of companies reporting, which I think might exceed last week’s but the fact that the biggest company of them all, Apple Inc, is reporting Thursday. The stock has held up relatively well, through the October whipping the bulls endured. That should signify a strong report coming—in fact, stronger than most Apple reports, judging by its endurance in the face of shellackings across every sector. The trouble with that is what if they’re wrong? What if the one quarter the shares are failing to signal softness in iPhone sales is the one quarter when iPhone sales were, finally, soft? I have no insight into Apple’s coming quarter, other than to say its mall-based store was busier than it’s been since the first iPads were available for pick up—or at least what I visualize as better, though it’s hard to say. Apple used to occupy a leasehold 1/5th the size of its current store, so the roped off lines to get into the store are no longer necessary. For my part, a little more skepticism into Apple’s quarter would sit better with me. Before its Thursday earnings report, Apple will host a media event, on Wednesday, for which it sent out invitations with, typically, few hints.

Other Earnings reports are expected from some other big names, like Akamai, Mondelez, Sanmina, Vornado Realty, Aetna, Allergan, American Tower, Amgen, Anandarko, AutoNation, Baidu, BP, Brinker, Caesar’s, Cheesecake Factory, Cummins, Denny’s, Eaton, Ebay, Electronic Arts, Facebook, Fiat Chrysler, GE, KBR, MasterCard, MGM Resorts, ….Just too many to highlight them all. But, then, that’s exactly what we’ve done, highlighting the coming reports most likely to attract the most attention, and influence sectors most. What stood out to us were large energy names, culminating in Royal Dutch Shell Thursday and, on Friday, topping it off with Chevron & ExxonMobil. Restaurants & the REITs that often house them, Hotels & Casino companies, and pharmaceutical companies—even GM, to go with the aforementioned Fiat Chrysler, and a number of builders, along with insurers & reinsurers who, I imagine, took quite a hit from this year’s storm losses—even allowing for how many people lost everything and had no insurance to cover their losses. Plus, with Baidu & Alibaba both reporting this week, the overstated "weak" Chinese economy could be put to rest. If no one believed the 6.7% growth in GDP quarter after quarter, why do they believe the 6.5% print last reported? And exactly how much of a difference is there between 6.6% and 6.5%?

As you might well imagine, Investment Bank conferences are a bit scarce, again, this week, as analysts dig into earnings reports & post-release conference calls. Gabelli, for the 41st year, is in Vegas for the CARS, SEMA, & AAPEX shows, hosting Automotive Aftermarket. Wolfe is in Austin for the ATA Trucking Forum, while Stephens is in NY for regional bank meetings.
Speakers at IMF 19th Jacques Polack Research Conference include IMF Dpty Mng Dir David Lipton, Tobias Adrian, the Dir of Monetary & Capital Markets Dept of the IMF, Profs from Columbia U & M.I.T., IMF Div Chief for Europe, Peterson Institute for Int’l Economics, U of Wisconsin Madison, Federal Reserve Researchers, Harvard Business School, U of NC Chapel Hill, Princeton U, World Bank economist, Raghuram Rajan delivers the Mundell-Fleming Lecture (Currently at Chicago Booth School), Yale U, Elihu Professor of Economics, the incoming Chief Economist of the World Bank Group, Prof at U.M. also member of NBER, U of Houston, U of Quebec in Montreal, UCal Berkeley, Brandeis Int’l Business School, Johns Hopkins, former gov of Bank of Mexico (Augustin Carstens). London School of Economics, who is also an external MPC for the Central Bank of the Mauritius--a slate of presenters who are so little known we’re not sure if they’re known well in economic circles, either. Rajan, the former Chief of the Central Bank of India is the best known outside IMF’s Lipton—and that’s from someone who’s been running down these conferences & speakers for 38 years. . (D.C.)

Consumer Goods Tech League Leaders Conference, emphasis TECHNOLOGY, so speakers are from INFY, Capgemini, Oracle. SAS, and lots of non-public companies. Nov. 1st SRI Conference (Sustainable, Responsible, Impact Investing) has a stellar group of speakers that range from Jeremy Grantham to CNN’s Chief Meteorologist, Apollo 9 Astronaut Russell Schweickart—even the U.N. Office of Outer space, who knew of such a thing?—a panoply of the unexpected alongside the typical. Metals traders that don’t get their fill at the London Bullion Market conference, starting Monday, can shoot down to Louisiana for the New Orleans Investment Conference, for 3 days of metals. Also Thursday, FT’s US Banking Forum could be a centerpiece, with most of that group don’t reporting until next year. Meanwhile, the group that brings us pending home sales, monthly, NAR—the Nat’l Ass’n of Realtors meet starting Friday. Also Friday, Nomura’s China Corporate Day in New York, and the opening of "Bohemian Rhapsody," at local movie theaters, everywhere, in which Rami Malek embodies Freddy Mercury as no one has since Mercury died of AIDs. When 2 original members of Queen are willing to pick up their instruments and back up the impersonator you just know he’s got to be great in the role.

Which brings us to the Economic Calendar, which promises meeting from the BoJ and BoE, with post-meeting press conferences from Kuroda overnight Tuesday, & on Thursday, Gov. Carney, respectively. Former FOMC Chief, Janet Yellen, is the dinner speaker Monday night, at the Montreal, Canada, FinTech Forum which will come to a close, 2 hours later, with a speech by Bk of Canada’s Timothy Lane. Chicago Fed’s Evans opens that Fed Bank’s Summit on Regional competitiveness. The Fed will release its Senior Loan Officer Survey, Monday, when Sept US Personal Income & Outlays + Savings Rate & PCE will be released. Tuesday, S&P Case/Shiller August 20-city Home Price Index—data that should reflect the number of people who aim to complete a move to a new home prior to school’s start—no matter where that school is. Yes, Florida & Texas start in August while a large part of the country starts after Labor Day. Either way, August in the month most often chosen for closings, to assure the kids are settled before the new school year starts.

The Federal Reserve meets on the 31st, to vote on easing some capital & liquidity requirements for some large banks that remain far smaller than the super majors. Also on the agenda, extending the time between stress tests for the super-regionals with assets in excess of $250B that remain, nonetheless, far smaller than the biggest boys, like JPMorgan & Citigroup.

Friday, automakers report October vehicle sales, GM excluded, since it stopped reporting monthly, which may not stop it from making some comments on October, when it reports Q3 earnings, Wednesday. On Thursday, shortly after Mark Carney has finished his post-meeting press conference, we’ll learn Q3 Productivity & Costs, and revised Sept Durable Goods Orders & Shipments. If you’re up past midnight, Saturday night, turn back your clocks.

Have you seen a commercial for the "Portal," by Facebook, for which pre-orders are now being taken? A Facetime-like video device, it looks derivative of Amazon’s video Echo but it, also, establishes FB’s arrival, as a new competitor, and I’ll bet Zuckerberg et al wish Apple hadn’t already locked up the Facetime name.

I don’t think it overstates it to say the market’s fate, for at least the next week, rests on Apple’s results. It might, also, help to keep your fingers crossed. If you’re still bullish, I’d recommend running through as many stock charts as you can—set to "monthly," rather than daily, to see the extent of the damage done. When you’re done that, it’s hard to find a bullish bone. The switch has been flipped.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar, here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

October 22—26, 2018     MORE DOWNSIDE AHEAD AS TRUMP RAMPS UP THE RHETORIC BEFORE MID-TERMS    We rarely see as many Fed speakers take the mic as we’re seeing this week, after an absurdly crowded schedule, last week. At least, for the moment, the speakers have carefully carved out their positions on additional rate hikes, so we know what to expect. Last week, we learned that Quarles agrees there’s a need for more rate hikes but specified he’d prefer an even more gradual pace. Kaplan would like to see rates get to neutral and, by then, might prefer to see the FOMC pause before getting restrictive. BoE Gov. Carney remains in North America, in Canada this week. Kashkari used to warn against rate hikes but needs to be heard from again. That will happen Tuesday but, the event on Childhood Education doesn’t quite jive with decisions on rates at neutral and beyond. Wednesday, we’ll hear more on housing, including FHFA’s Aug. New House Price Index, and Sept New Home Sales. That’s when Fed’s Bullard will deliver the Adam Smith Panmure House Lecture, with Q&A, in Edinburgh Scotland. Also Wednesday, Loretta Mester will suffer a "Conversation" at the Forecasters Club of NY, while the Fed’s Bostic will speak as LSU’s Center for Energy Studies (CES) Energy Summit. And then, if housing didn’t tell us quite a bit about the economy, the Fed’s Beige Book will be released at 2pm. Tariffs, a tight labor market, and higher rates are spooking many CEO’s, the flood of reports, this week, sure to reinforce that position.

Thursday,a decent interval before US markets open, ECB Pres Draghi, will host a press conference shortly after the ECB meets and rules on rates & QE. While he might want to change his posture, he can’t because of Italy, Greece, and other European countries not doing as well as Germany, which might win the ECB Presidency, in 2019. Furthermore, he’ll gone out on a limb promising to uphold QE until the end of this year, and not tighten, before the end of next summer. He’s also scheduled to speak overnight Thursday, delivering the closing keynote of a Conference on "Understanding inflation dynamics: the role of costs, mark-ups & expectations," in Brussels. Sounds wonky to me, and not exactly a place where he’ll reverse other assurances.

Advance looks at US GDP, & both Rtail & Wholesale Inventories are expected Thursday, also. NAR Sept Pending Home Sales are expected, also. Please don’t let anyone convince you that rising rates dissuaded house shoppers in Sept, especially. The FOMC didn’t meet until the 25th, and didn’t raise rates until the 26th. Given most prefer to move into new homes before school starts, and the vast majority of the country starts the new school year after Labor Day, home sales should be front end loaded, not back end deterred by higher rates. Last, on Friday, US Q3 GDP, that includes the Fed’s favorite data point, PCE.

Three separate conferences, it seems to me, should be merged into a single, larger event instead of taking place in 3 different cities. SMPTE Motion Picture & TV Engineers Technical Conference (Los Angeles CA thru 25th), ShowEast Expo (Miami FL thru 25th), all about screenings of upcoming films, as well as specialty films being offered into syndication and for VoD, plus the third event, Storage Visions, from the Entertainment Storage Alliance, subtitled Surviving the Data Apocalypse in Santa Clara CA.(thru 23rd). But, for a moment, let’s skipped the Event Calendar because the Earnings Calendar is so heavy with S&P 500 members.

The tickers highlighted are those that can do the most to boost or pull down stocks, the sheer volume of scheduled reports could be deafening by the end of the week. On the other hand, big tech reporters are expected to report strong top and bottom lines, which might get that group back on track for more upside. In highlighting reports, we included the homebuilders scheduled to report, since the best of their two top quarters include the one being reported. The group looks half dead, as bad as REITS did for the first year and a half after the group was separated from financials, to make up its own group. Rallying retailers was all it took for REITs to regain their footing. What will it take for the builders to do the same? And I don’t mean anything as temporary as rates easing back when stocks fell hardest, in October.

It feels too early for stocks to celebrate a Q3 that wasn’t as bad as the worst fears assumed. And then, it probably wasn’t as terrific as the prior two quarters. Instead, expect it to take one more full week of earnings until stocks fully regain their footing. If not for the last few days of the month than closer to Election Day, which is stacking up as one of the most suspenseful in years. I’m mean, really, did anyone really think Brett Kavanaugh demonstrated the restraint and impartiality required of a judge?

ECONOMIC: (Highlights, only below. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.  

October 15—19, 2018  BEARS ARE NOT READY TO GIVE UP  Janet Yellen provides the general session at the Mortgage Bankers Ass’n Annual. She’ll be interviewed by Fortune Magazine’s Geoff Calvin, which clearly opens the door for him to ask what she thinks of Trump’s sharp criticism of the Fed Reserve--perhaps, even, ask about Powell, the latter question she, no doubt, either won’t answer, or will, by complimenting his actions and comments to date. Calvin might, also, ask the Queen of slow rate rises (waited a year between rate hikes when her Fed first started tightening), whether Powell is moving too fast. For the curious, she’s now affiliated with the Brookings Institution, where Ben Bernanke is, as well..

The Investment Community has penciled in September Retail Sales +0.6% after only +0.1% in August. I’ve got a mixed view on that data, coming Monday. On the one hand, Hurricane Florence made landfall on 09/13, and took out the majority of nboth North & South Carolina for the rest of the month but, also, caused problems in states south of South Carolina, on its way in. Further- more, the Jewish holidays fell completely in September, this year, which hurt mall traffic Sept. 08 through 11, and again, the 18th & 19th, though supermarkets might have picked up some of the spending slack seen in apparel and/or footwear. On the other hand, my view is mixed because Apple introduced and started selling new iPhones, towards the end of Sept. Its mall store was busier, this release, than it’s been for the last 2 years of releases. I’d say traffic and the number of shopping bags were 4x the number seen after the 2017 releases (when iPhone X was released after Sept closed), and 2x the traffic seen in 2016. Shopping bag count was significantly higher, this year, compared to 2017. Several families of 4 and 5 were seen walking out of the Apple store, each family member with their own bag. Given how many more people are comfortable buying online, now, the traffic at the mall store came as a surprise. It was equally curious to see that AT&T was offering $200 off new Apple iPhones to military, since that seemed a ploy to draw shoppers away from Apple stores & Apple.com. The offer had some positive impact, since AT&T’s mall store, just feet form Apple’s, was busier this past weekend than it was at any time after the 2016 n&’17 release weeks but, then, even 2 people going into a T store would have been significantly more traffic than last year’s, and 5 people a mob compared to 2016. All in, though, it sounds to me like +0.6% might be a stretch, even if Florence didn’t, initially, cause the same "CNN effect" as other devastating weather events have in the past.

To some, the biggest event of the week is Canada’s legalization of marijuana, starting Wednesday, though release of the FOMC September meeting minutes are the be all and end all of the week for others. Powell’s indication, last week, that rates are far from neutral suggests he knows where neutral is. Perhaps the minutes will provide additional information, or the Fed speakers scheduled to mingle this week—just don’t count on it. Doves like Bullard aren’t going to flip in a week, and Fedheads have been very active speakers since the September meeting ended. Note, also, the FIA 34th Annual Futures & Options Meeting, in Chicago, starting the same day, when we’ll also learn of building activity in Sept, Starts & Permits, as well as the EIA weekly Petroleum, Gasoline & Distillates Report. It was difficult to ignore the big dip in pump prices, this week, high-test 20c cheaper than each gallon was 9 days ago.

Monday, Open Enrollment for Medicare starts for the 2019 Calendar year. That will run through to December 7th, with health insurers and provider offering periodic updates on enrollment and, particularly, retention. It’s much cheaper to keep a enrollee than it is to attract new ones. Thursday, Fed Reserve Board Vice Chairman, Randall Quarles speaks at the Economic Club of NY. Not being a member, I couldn’t dig up more information, like his topic, say, but he’s one to watch. Also, Friday, Fed’s Kaplan speaks at the Manhattan Institute, on "10 Years After the Crisis: The State of Monetary & Financial Policy." His lunch time talk will be preceded by comments from Mickey Levy, Peter Ireland, & Anthanasios Orphanides, a former Greek FinMin, during the worst of its debt crisis and disagreements with the European Union leadership. Also Friday, Fed’s Bostic speaking but the "discussion" he’s scheduled for Saturday could be the most revealing one. He will discuss the "implications of the Fed’s Interest rate decision, the Atlanta Fed’s data gathering methods, and which data is used by the Atlanta Fed." He’ll stick around for an open Q&A session, his topic the most promising of the week’s, given the "neutral interest rate" could indicate just "how far away" the neutral rate currently rests.

Friday, Bank of England Governor Mark Carney speaks at the Economic Club of NY, lunch time. Where the BoE is, and where it’s going is an open question because the UK hasn’t settled on the terms of its separation from the EU—Brexit. He’s the man who has no idea what the BoE will need to do with rates in the near-term, and not for at least the next year, since whatever deal is finally struck—if one is, at all—will determine how the country reacts and performs. For now, everything is merely conjecture. Also Friday, Sept. Existing Home Sales. Even though there are only a few days before Labor Day, after which most of the country commences a new school year, August and September closings are seen as impacted by the school year—parents want their kids living where they’ll be going to school, before school starts. Another weak number might be unsettling for the equity & bond markets, especially since at least some of us assumed there’d be a last minute rush to sign for a new mortgage, before the Fed hiked rates on the 26th, sending mortgage rates still higher than they already were, compared to 2017.

That brings us to the Earnings Calendar, which is far more voluminous than last week’s. If there ever were weeks that need selected tickers to be highlighted, this and the coming 3 weeks are it! The rest of the major financials are reporting, including Bk of America, BlackRock, Goldman Sachs, Morgan Stanley, Northern Trust, Alliance Data Systems, US Bank, American Express, E-Trade Financial, Bk of NY Mellon, BB&T, Blackstone, KeyBanc, Travelers Insurance, Charles Schwab, State Street, SunTrust, & Synchony are all on tap—even PayPal. But, there are also many non-financial reports scheduled, including Health, W. W. Grainger, Kinder Morgan, SL Green, Steel Dynamics & Nucor, Philip Morris Int’l, PPG (already warned), Crown Castle International, SAP, Snap-on, United Rentals, Winnebago, Canadian Pacific Railway, Danaher, Intuitive Surgical, Taiwan Semiconductor, Werner Enterprises, ManPower, Proctor & Gamble, and Schlumberger, to name the ones that should attract the biggest crowds. Snap-on, particularly, a name that provides insight into the neighborhood gas station’s repair bays. People put off repairs as long as they can, when funds are tight. Today, not only are new auto sales and leases coming off 4 incredibly strong years, cutting into the neighborhood grease monkey’s business but with unemployment so low, those nursing older cars should have no hesitation bringing in their jalopy for service.

That leaves the Event Calendar, that offers few I-bank conferences, in deference to the Earnings Calendar, which is tough competition. Notable events include the High Point Furniture Market. Few other "to the trade" events get as much general media coverage as the twice yearly High Point. Only the fashion industry’s runway shows get more general media coverage, in addition to the fashion-specific coverage it gets. Also especially large and well covered will be NAB--the Nat’l Ass’n of Broadcasters, which has a slew of sub-conferences scheduled to coincide. That includes AES (Audio Engineering), Content & Communications (aka CCW), SatCon, and more. But Digital Hollywood (Tues.), which one might consider a perfect fit with NAB, is instead in Los Angeles (NAB in NY). Many digital Hollywood/Film events associated with storage, rather than broadcasting, for whatever reason.

Oddly, the Powersports Dealer Expo meets in Las Vegas, the same week the U.S. Powerboat Show—a consumer show—meets in Annapolis. Powerboats, of course, are associated with warm weather, yet, SnowMonile USA also was held over this weekend. Mortgage Bankers are meeting starting Sunday, Janet Yellen, as stated above, the General Session speaker. Over the last 2 weeks, a couple of banks announced cut backs in their mortgage departments. Higher rates are, already, impacting home sales.

Even as Medicare open enrollment kicks off, Monday, the American Association of Health Insurance Plans hosts its National Conference on Medicare, Medicaid & Duals (those eligible for both Medicare & Medicaid.). As it is most weeks, there’s no shortage of medical-related events scheduled this week, Earnings Season or not. The American Society of Human Genetics starts Monday, ASBMR hosts its 12th Int’l Conference on Osteoporosis, Arthritis & Musculoskeletal Disorders also starts Monday, along with CNS for Children’s Neurology, Leerink’s HCIT & Distribution (Tues.), the European Society for Gene & Cell Therapy, Partnerships in Drug Delivery, HDA Pharmaceutical Distributors Traceability Summit (Wed.), Orphan Drugs & Rare Diseases, World Congress of Itch, Fall Clinical Dermatology (Thurs.), Pelvic Pain, European Ass’n of Cardio Thoracic Surgery, Kidney & Nephrology Therapeutics Summit (Fri.), EU Medical Oncology, EU Intensive Care Medicine (Sat.), and more, the biggest of those BIO Investor Forum, starting Wednesday.

Retailers are starting their seasonal hiring, via single day Job Fairs. Dollar Tree’s (and Family Dollar) starts on the 17th, Macy*s is on the 18th. Even more significant for the retail index, is Walmart’s meeting with the Investment Community, on Tuesday, the 16th. There’s usually a special entertainer featured at the event, most often a musician who’s about to introduce an album he or she will sell through WMT, only. Because of its upcoming meeting, I went into both Walmart & Target, this weekend, which are night and day. WMT reminded me of a 3rd world country, boxes of Halloween candy piled high, empty cartons on push carts, in the aisles, leaving barely enough room for a single shopping cart to maneuver the aisle. Heaven forbid 2 carts try to go down an aisle, either in the same or opposite directions, it usually can’t be done, at least not with disturbing a waist high display for both to get through, no matter how far over each cart tries to get. All the merchandise & boxes piled high make WMT seem dark. Target is bright and open, without any trollies of empty cartons blocking the aisles. At WMT, three of the items I might have bought there were not available, empty spaces where there products should have been. At TGT, even when it seems they stock only a single package of any given product, somehow TGT always has that product in stock, no matter what day of the week or time of day I go. I go to TGT frequently because it often offers the best price on the soda I drink. Plus, that extra 5% off with the TGT Red card adds up over the course of a year, or years. In addition, TGT’s prices are usually competitive with WMT’s but, when throwing in the extra 5% off, TGT more often than not comes in ahead of WMT. I take a calcium supplement that’s $14.98 at CVS, 2c less at Walgreen, but $9.98 at TGT before the 5% is deducted. It’s exactly 2c less at WMT but WMT never has it in stock.

Much of TGT’s new apparel looks stylish and on point while, at WMT, let’s not go there. I had dinner at friends’, Saturday night, and they raved about TGT’s clothing, their four girls, 5 years old to 13, three of them on a swim team at a nearby private school. Every time I hear an analyst rave about the physical improvements at WMT stores I want to know where their store is. There are 3 within 4 miles of my house & office, and all 3 are horrible to have to walk into. About the only thing WMT has going for it is the small size of liquid Tide at $5.24, while CVS is offering it for $8.99, and TGT doesn’t sell that size—it’s too small for them. At WMT, I have been filling one prescription every 3 months there, to force myself to check up on it. Last year, my Rx cost $!0. Earlier this year it went to $30. Today it was $39.24. Bye-bye Walmart.

Look for Halloween candy prices to be slashed, starting with next weekend’s circulars. WMT, in particular, has so much candy it will have to slash its prices to start moving it. And, it’s the one holiday when the drug store chains are competitive. Yesterday, I bought a bag of Halloween treat size Kit Kats at CVS for $1.99. Today, the same bag was $2.99 at WMT. So far, it looks like stocks have only ‘tricks’ for investors. I don’t expect to see the kind of reversal back up we saw after stocks were dumped on news that the UK had voted for Brexit. It is when everything sounds so good that the next recession’s triggers start to build up. I do believe there’ll be one more upside run before the year ends, or early into next year but the bull market so many have enjoyed since March 2009 is now gone. Start polishing your short skills. They’ll probably come in handy by the 2nd quarter of 2019.

ECONOMIC: (Hghlights, only, below. Full International Economic Calendar is here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence. 

October 08—12, 2018  BULLS WILL TRY & SALVAGE THE MONTH     With a holiday on Monday—Columbus Day—there’ll be light activity but probably a minor recovery from late last week’s sell-off to start the week, at any rate. From there, an IMF/World Bank Group Fall meeting in Bali, Indonesia sounds exotic but probably not too large an influence on US Trade, the rest of the week, after the initial IMF World Economic Outlook, due for release Monday overnight, which will already be Tuesday, in Indonesia, sadly, parts of the country recovering from an earthquake & tsunami that didn’t hit Bali, as far as I know. Interestingly enough, BlackRock’s Laurence Fink, jPMorgan’s Jamie Dimon, Morgan Stanley’s James Gorman, and Socgen’s chairman, all scheduled to speak at the International Institute of Finance meeting, Friday, in Bali. However, JPMorgan is scheduled to release its Q3 Earnings, on Friday, so one has to presume he’s teleconferencing for one of the events.

Speaking of Friday’s Earnings, Citi, First Republic, PNC Financial and Wells Fargo are also Friday earnings reporters, so whatever happens Monday through Thursday could be undone by Friday’s release schedule. Except for Friday, last week, when 10 & 30-year rates became strongly favorable for bank net interest margins, giving the financials a big lift, the group has been acting like dogs that failed to qualify for any races as the West Palm Beach Dog Track, which a constitutional amendment is seeking to close, leaving only the card rooms already there. Other than the Financials, Friday, Delta Airlines & Walgreen Boots Alliance are the next 2 biggest reports of the week, both of those on Thursday. However, Fastenal Wednesday should be a fair read on industrial America, while Helen of Troy should provide insight holiday sales in the personal care & home small appliance space. WBA, on the other hand, seems all over the place, flailing around to set a new direction. There was its ill-fated partnership with Theranos, a new partnership with grocer, Kroger, the ink on which is just drying, a deal to sell its private label brand beauty products to Chinese consumers, on Alibaba’s marketplace, an early this past summer investment in a Chinese pharmacy chain, GuoDa, even as it’s reducing its stake in Guanghzou Pharmaceuticals Corp, announced still earlier, this past summer. WBA is like a Giacomo Casanova who can’t decide if he wants a blond, redhead, brunette, or other, making CVS Caremark looking like a much more visionary and stable choice, as its deal with Aetna nears closing.

Aside from the IiF, IMF/World Bank, the Economic Calendar also promises Fed speakers are mostly stateside, except for the New York Federal Reserve President/CEO John Williams, who’ll be speaking in Bali, late Wednesday, 2x. Big data in the US includes PPI Wed., CPI Thurs., and a crap hole of US Treasury auctions, starting with 4-week, 3-, & 6-month bills, plus 52-week Bills, Tuesday—a heavier than usual day because of Monday’s Columbus Day holiday. . Wednesday Treasury is offering 3-year Notes, and 10-year Notes, before Thursday’s 30-year Bonds. Meanwhile, sometime this week, the Social Security Administration should be announcing the inflation increase on the retirement benefits it administers, as well as those that flow to military veterans.

As should be expected, given Monday’s Federal holiday, Events don’t really pick up until Tuesday. When Cowen & Co hosts its 21st Annual Therapeutics Conference, though most of the I-banks are hosting their events overseas. Wednesday, Raymond James hosts North American Energy Forum, and CIBC Liquid Alts, while the 12th Annual Pain & Migraine Therapeutics could be a showcase for the 3, recently approved Migraine treatments, after decades of almost no breakthroughs. Meanwhile Honeywell soon to spin off Resideo Technologies will host its Investor Day, Wednesday, also, even as a challenge to Genetech’s Rituxan will be discussed at an FDA Oncologic Drugs Advisory Committee (AdCom) meeting. The biologic drug application was submitted by Celltrion, which has a marketing & sales agreement with TEVA, which could badly use some good news, itself.

Thursday, Cowen hosts its 7th MedTools Unlocked Conference, even as the 13th Annual Obesity—Diabetes Summit gets underway, in Biloxi MS, cause meeting at casinos known for "All-you-can-Eat" $10 buffets is the best setting for avoiding obesity & diabetes. ACC for Cardiology Heart Valve Summit also starts Thursday, even as Automotive News Retail Forum meets in Chicago, Powersports Dealer AIMExpo, the US Powerboat Show, and SnowMobile USA also meet. Boy! Did the International Academic Conference on ‘Meaningful Play’ realize it picked the same day to start its conference as the pricey water & snow sports equipment associations? A coincidence, no doubt. And finally, the potentially biggest event of the week starts Friday—the High Point Furniture Market, in High Point NC, which presumably escaped flooding or already recovered from any deluge Florence dumped on the Carolinas.

There are many who seem to think the Financials fly on the day they report their earnings but, in fact, the group reporting Friday rarely do. They’re more likely to join a larger party the week after this one—when Morgan Stanley reports, Goldman Sachs an outlier which seems to decline no matter by how much it beats the analysts’ estimate, since it rarely beats in a way that the analysts approve wholeheartedly.

The bulls could win by holding losses, this week, to last week’s lows, establishing a bottom upon which the bulls could build a recovery, later in the month. The problem I foresee is the mid-term elections ahead. Schumer and the Democrats making the mid-terms a referendum on the Trump presidency, and the Kavanaugh confirmation. The liberals may be loathe to admit it but the same people who put Trump in the White House are still rabid fans. What the mid-terms will be about, if anything, is who is more motivated to go to the polls or, as in my case, mail in the ballot that already arrived for the November election. And once again, I have to confess, I don’t like either candidate for the US Senate or the Governor of my state of residence (Florida). But given all the problems Florida has voting, at all, I’m never sure if my vote has been counted, anyway. And don’t for a minute believe the polls that have a democrat leading in both of those races. Florida is one of the reddest states in the country (ex- the southern tip, where I live), and touts in the press claiming Democrats are ahead is just a way to get Republican votes out, perhaps persuade Dems to stay home. It’s going to be a long month until the polls close.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)   

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence. 

October 01—05, 2018    NEW MONTH, NEW QUARTER, TIME FOR TECH TO REVIVE????     New Quarter, new amount of Agencies & Treasuries the Fed is going to allow to run off, monthly—$50B. For the first time in years, the Fed’s balance sheet fell back below $4 trillion, according to its most recently published holdings. The Fed’s holdings will continue to run off at the new rate until the Fed tells us something different. Reaching $50B after a year was the monthly goal for cruise control—the Fed’s desire to have those holdings run off automatically, in the background, without any to-do. But one can’t raise rates quarterly, AND allow a balance sheet to run off, even as the Treasury needs to issue more debt to fund a budget that’s putting the US into deeper debt, all of which will suck up liquidity, even as the cost of the debt keeps rising with each Fed rate hike.

As happens at the start of every quarter, a new Japanese Tankan Survey will be released, and GM will reveal its quarterly sales, its monthly sales no longer released but, perhaps, a quarter’s worth a better reveal, anyway. The San Francisco Federal Reserve Bank gets a new leader, Mary Daly, with the rest of her cohorts about and around the country, talking up a storm, just as the Nobel Prize committee releases all but the Literature & Economic Prize, this week. The Nobel committee said it would not award a prize in literature, this year, while the Prize in economics was never a Nobel prize, given out by an organization that seeks to rectify an oversight in Nobel’s planned prizes. One thing is for sure, when the Nobel Prize for Peace is announced, Friday, Donald J Trump isn’t getting it since North Korea has done squat about denuclearization, since he bragged about freeing the world of the North Korean nuclear threat.

Meanwhile, China is off all week for Golden Week—a collection of daily holidays clustered in the week that leads to a week-long national holiday. The new Federal year begins, Monday, when the Supreme Court convenes its fall session, for now, without Brett Kavanaugh. If you caught any of last Thursday’s testimony by Dr. Christine Ford & Judge Bret Kavanaugh, you probably saw the entire 9.5 hours. Riveting stuff, Kavanaugh, in my opinion, crossing many lines in his testimony, perhaps proving he doesn’t have the temperament for traffic court, let alone a lifetime appointment to the Supremes. To be a fly on the wall at Cantor Fitzgerald’s Global Healthcare Conference, Monday, when Pres. Bush keynotes. Of all the former presidents still alive, he’s the one I remember being least able to speak. Just recall the way he said "nuclear." He didn’t win the Peace Prize, either. FOMC chief Powell will speak Tuesday, at NABE, offering "View from the FRB," at a noon luncheon. He’s worth listening to, because he seems to have built fewer defenses against saying something he’ll latter wish he hadn’t iterated. The FOMC is the only Monetary Policy Committee not planning on meeting in Oct. this week, alone, MPC’s meet in Australia (Tuesday) & both India and Mexico (Thursday).

Friday, the September Unemployment Report will be delivered, a month in which we always expect school-related employees to impact, the BLS’s "seasonal adjustments" usually successful in stripping out the surge in employees. And I don’t mean just teachers—bus drivers, secretaries, janitors—you name it, schools have them, the majority employed starting just before or just after Labor Day, when most school calendars resume.

The Earnings Calendar is slim, with just a few names of interest, i.e. PAYX, PEP, LEN, SNX, STZ, & COST. Lennar, Wednesday, builds more homes than any other builder, so often is the one name that stands out. Furthermore, it builds houses that are often at or only a bit above the median price home, which makes it a good read on the average worker’s ability to buy a home.

The Event Calendar picks up a bit, with NECA, NABE, & EEI Sunday, as notable as Paris, France’s Ready-to-Wear fashion shows of equal interest. With retailers coming off 2 years of mall weakness to rebound, over the summer, it’s really the fashion quotient that will determine how strong mall traffic will be this fall and holiday season. In places where winter will soon bite, malls stand a better chance of attracting teens than they do here, in Southern Florida, where school started in mid-August, and "feels like" temperatures remain over 100 degrees. Starting Sunday, ACI-NA North American Airports Council, AASA Automotive Aftermarket Technology, ARTBA: Road & Transportation Builders were all slated to gain from Trump’s promise to spend billions on infrastructure but, alas, he’s shown little interest in any building other than the border wall with Mexico.

New York hosts Ad Week and all the associated sub-events connected to it. The toy industry’s fall preview is in Dallas, Ibex and other boat building related events in Tampa. Digital Book World Conference/Expo meets in Nashville, which is odd, because Amazon controls most of the digital book world, as well as audible, the company responsible for spoken books that have become popular companions to drivers with long commutes, and seniors who like to bring the library to their homes, instead of traveling to one. Speaking of Amazon & audible, AMZN is releasing "Harry Potter: A History of Magic" as an audible book, on Thursday. IFE, Americas Food & Beverage takes place in Miami Beach, because it’s really about the southern "Americas," south of Gulf Coast. But it starts Monday, when the nation’s Restaurant News hosts MUFSO, while Supermarket News hosts a Supermarket Summit, also in Dallas. Given Restaurants & Supermarkets have become competitors, it’s really a strange bit of scheduling, Monday. MUFSO includes the expected Chefs, including Jose Andres but, also, Kimbal Musk, who owns restaurants. Chain brands are prominent, including Inspire Brands (just spoke up for Sonic Drive-Ins), LongHorn Steakhouse (DRI), Del Taco (TACO), MCD, RRGB, Smoothie King, and lots of awards. So what does MUFSO stand for? Beats Us! Couldn’t find an answer anywhere on the website.

In addition to Cantor’s Healthcare Conference, Deutsche Bank hosts its 26th Leveraged Finance Conference, in Scottsdale, starting Monday. It’s not an I-bank conference but MDRP, the Medicaid Drug Rebate Program Summit, in Chicago, could become more interesting if Dems pick up some state governorships, and leadership in either house of Congress. DB’s event cuts across all sectors though telecoms, media & energy companies are as prevalent as usual. On Tuesday, Leerink hosts rare Disease & Immuno-Oncology (I-O in the vernacular.) Ladenburg Thalman is, also, hosting Healthcare, BMO Capital Global energy Leadership (Pinehurst NC), even as Wolfe Research hosts Utilities & Energy. Macquarie’s Montreal US Analysts day is a day during which Macquarie’s US analysts travel to Montreal to meet clients up north. Bloomberg, on the other hand, will host Canadian fixed Income in NY, even as Berenberg hosts Future Energy in Zurich, Tuesday, after hosting it in London, on Monday. The Paris Auto Show Conference starts Tuesday, in Paris France, while credit Suisse will host its 2018 Auto Show Conference there, as well. Both Securities Traders & FPA (Financial Planners) host respective meetings, starting Wednesday, in different cities. AGA, the American Gas Ass’n Executive Conference takes place in D.C. while San Francisco hosts ID Week, for Infectious Diseases. On the other hand, the virus bulletin Int’l Conference vb2018 refers to digital viruses, not infections. In Paris, SocGen hosts Large & Midcap Conference, Deutsche Bank a Philippines Conference, SGX/Credit Suisse Real Estate Corporate Day (in Singapore), and Berenberg TMT in Zurich. Macquarie is hosting its Annual Green Energy Conference in London, Thursday, when Citi hosts PCA-Emerging Restaurant, B Riley FBR its 4th consumer & media conference, even as CE hosts Digital Music, in NY, as part of the NY Media festival, an offshoot of Ad Week. Strategas hosts its 5th Annual Investment Forum in Rosewood, Bermuda, Thursday, though I suspect it will be about the midterm elections, rather than companies, per se. In fact, I couldn’t’ find a single company that announced participation in Strategas’ event. NYU Stern School of Business hosts "Redefining Luxury—Future of Retail" a group that’s enjoying a renaissance, as the 1% benefit from strong stock market gains, and Chinese strivers return to shopping for luxury products.

There’s usually a lot of movement in the first week of a new quarter but it could be more biased to the downside, as PM’s rebalance their portfolios, pre-announcements are released, and company buybacks go on hiatus in advance of earnings season, which will kick off in mid-month after next week’s 4-day week for bonds. With Chinese businesses & markets closed for Golden week, all week, and financials nearing a line in the sand, under which they will not be able to bounce and will totally spook the market, there’s no reason to be a hero, this week. The risks are weighted to the downside. Given Tech stalled out right before Financials started exploring the downside, the title of this piece isn’t meant to suggest Tech will revive but, rather, insist it’s the group to watch, along with financials. If they both don’t revive, the bulls will be outnumbered, at least until they do. And bear in mind, Financials will lead off earnings season, starting October 15th. In a single week, JPMorgan went from making a new all time hi to probing longer term support. End of quarter shenanigans? Perhaps but none of them had a great story to tell at recent Financials Conferences, so until proven otherwise, assume Fed hikes are dinging loan demand, rather than improving financials’ NIM. At least that’s the story their stocks are telling.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be only one factor in more complete due diligence.

September 24—28, 2018  FOMC RATE HIKE SUBSERVIENT TO Q3 END   If there’s ever been a more certain rate hike coming, I can’t remember when it was. And it’s going to be an especially noisy week, beyond the FOMC decision, what with the U.N. General Assembly opening, and Trump on his way to address the world, in what for Dems will be another cringe-worthy appearance. If that weren’t enough, there’s the ECB’s 3rd Annual Research Conference, BoJ meeting minutes, and some lagged US Housing data expected, even as it seems as if every central banker of moment will have a place on one stage or another. And despite it all, Quarterly rebalancing may well take center stage, as portfolio managers position for the coming midterm elections and the rest of the year, the Quarter ending with this week, though for many, it ended with last Friday’s Quadruple Witch Expiration. Bear in mind, the SEC shortened the clearing time to T-2 from T-3, which could boost exchange volume Wednesday, beyond what might be anticipated on FOMC decision day.

The Earnings Calendar is slim but not without some notable reports, including Jabil Circuits, KB Home, & Nike Tuesday, Bed Bath & Beyond plus CarMax on Wednesday. On Thursday, Accenture, Carnival Cruises & ConAgra join spice seller McCormick, which often comments on restaurant activity, in its conference call. On Friday, the report from BlackBerry could once, again, surprise but it’s Vail Resorts that I’m most interested in hearing from. The 1% are having a banner year, which is often reflected in Vail’s report.

A number of medical device companies plan "analyst" meetings at TCT 2018—Transcatheter Cardiovascular Therapeutics. Edwards LifeSciences (EW), Boston Scientific (BSX), and Abbot Labs (ABT) are 3 that announced meetings with analysts at the event, but they’re not analyst meetings as we usually think of them. Instead, they’re touting presentations of researchers working in their clinical trials, as well as 1x1 with management at the booths set up in the exhibit hall. By the time you can read this, the details about late-breaking posters will be available.

In a sign of how times have changed, SolarPower International used to be one of the biggest events of the year. It starts Monday, in Anaheim, California, but I doubt it will be a fraction of the big deal it used to be. Anyone seen those Elon Musk roof panels that look like barrel tile roofing? ROTH is holding its Solar & Storage Symposium at the event. The Lodging Conference, also starting Monday, is a large event that involves everyone and anyone in lodging. I’ve provided the participants at the Deutsche Bank Retail One-on-One Day in Boston. I can’t help feeling that now would be a good time for retail execs to temper the enthusiasm, just a bit. I think it’s fair to say DB has invited some retailers who’ve been disappointing, even as sales picked up over the summer, traffic in malls rising a bit from seriously depressed levels. But for some, like Ross Stores, Target, & ULTA, the Street is so enthusiastic, it might be nearly impossible to exceed the whispers and hopes.

Perhaps buried in the very busy Events Calendar, is the NAB Radio Show, in Orlando, starting Tuesday. Starting Wednesday, there are the Penn Veterinary Conference in Philly, Spine Society Evidence & Technology Summit in L.A., and the International Vision Expo in Las Vegas. The MLPA Annual Meeting in D.C. could be interesting for the changes in tax treatment instituted with last December’s Jobs & Tax Act. Thursday, Rosenblatt’s 11th Annual Fall Investment Conference, in Chicago, is notable for SEC Chair Jay Clayton’s keynote. But, then, the Senate Judiciary Committee is supposed to hear from Brett Kavanaugh’s accuser, Christine Blasey Ford. On CBS Sunday Morning, they went back to Anita Hill’s 1991 sexual harassment accusations against Justice Clarence Thomas. Many of the current Committee members were members, then, too, the committee chaired by then Senator Joe Biden. And it doesn’t appear that men know how to handle accusations of sexual impropriety any better today than they did then. What Ford’s testimony means is D.C. will remain a zoo, even as New York’s zoo will be cranked up to max output and absolute gridlock.

This week could be one for the record books, and even then, I hesitate to suggest that the kinds of records I’m talking about are the kind the DJIA & S&P 500 made last week. Brace yourself for a wild ride.

ECONOMIC:  (Highlights, only, below. Full International Economic Calendar here)  

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

September 17—21, 2018    QUADRUPLE WITCH EXPIRATION     There’s more economic news out of China than the US, with the US news mostly related to housing. The Jewish high holy day of Yom Kippur starts at Sundown on Tuesday, and lasts until sundown on Wednesday. Even the least observant Jews tend to avoid working during those hours—just in case.

The BoJ meets for 2 days but isn’t alone. Also meeting, The Swiss Nation Bank & the Norges Bank—the National Bank of Norway, plus South Africa’s central bank. Yes, ECB’s Draghi, Nouy & de Galhau speak at a Parisian event starting while we’re sleeping, on Tuesday, pre-market hours but no earth-shattering remarks are expected.

The U.N. convenes annually on the Tuesday of the 3rd Week of September, a week counted even if it contains only 1 day. The UN General Assembly is also known as UNGA) begins on the 2nd Tuesday of the month, but the big wigs from the most important countries don’t show up until the 18th, and most sessions will be attended by attache’s and undersecretaries until the 24th, when the highest level debates and speeches run for 9 days. In fact, you know the 24th is the bigwig day because it’s scheduled for UNGA high Level Plenary Meetings on global peace, in honor of the centenary birth of Nelson Mandela, so known as the Nelson Mandela Pea e Summit. Simultaneous with the 73rd General Sessions, the Global Goals Week & Climate Week NYC 2018 meet. Hot topics in 2018: Russian "invasion" of Crimera (still), Syrian Crisis, North Korea’s nuclearization. And, of course, with the influx into NYC, those who need to get around the city usually slip into foul moods.

The Earnings Calendar slims considerably but contains some battleground stocks, like Oracle (Mon.) & Micron Tech (Thurs.). But, perhaps, it’s Fedex, Monday, that will attract the most attention, in a season that's usually off for package deliveries but could surprise, thanks to Amazon’s July Prime Day. No match for Alibaba’s single day, in November, Prime Day, nonetheless, might have been responsible for stronger July Retail Sales than those reported, recently, for August. Speaking of BABA, it’s hosting a 2-day Investor Day in Hangzhou, China, that starts Monday.

A combination of Yom Kippur and the gridlock that accompanies the U.N. General Assembly is reason enough for so many I-banks to choose locations overseas for many of the week’s events. China is a favorite spot. JPMorgan & Citi, most notably, taking their events to China, while Tuesday is a busy day for domestic investor relations events.

Cambridge House’s Extraordinary Future Conference, in Vancouver, bills its event as "The Hottest Tech Investment Opportunities" but also covers the future of science & life, meant to drive Canadian innovation.

AGA Mini-Financial Forum for Analysts includes ATO, ED, ES, NJI, NL, OGS, SJI, SWX, SR, UGI, the 20th but there are 3 separate events named for NY the 19th & 20th that come down to those presenters, no matter how many times the American Gas Ass’n separates out events with individual & collective names.

Then, again, watch out for Friday’s Quadruple stock & index Expiration. If there’s any step back in stock investments, it’s liable to arrive post-Quadruple Witch, as the days tick off to mid-term elections, Trump’s (and the Republican’s) hold on Congress at risk. Ironically, stocks have done best when Congress is split, so a Republican loss of one of both houses of Congress doesn’t, necessarily, spell doom for stocks. There are no sure things, of course, when it comes to stocks. Therefore, don’t bet the farm on any particular bet, without spreading the risk.

ECONOMC: (Highlights, only, below. Full International Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security.The Opinions expressed are the author's, alone, and should be just one factor in more complete due diligence. 

September 10—14, 2018  L’SHONA TOVA   The way Sheryl Sandberg (FB), in her testimony to Congress, last week, talked about working with Congress to devise regulations I couldn’t help hearing in the back of my head, "so we’ll have immunity from people like Jones of InfoWars, when we disable his account." Just like pharmaceuticals try to hide behind FDA approval when a medicine turns out to be dangerous, social media companies are looking for a way to regulate how far free speech should go on their platforms, without being prosecuted by those it terminates. So, yeah, social media companies want to collaborate with Congress to set limits to free speech on their platforms. Of course, FDA’s rigorous approval process does NOT shield pharmaceutical companies from lawsuits but it does set limits, and that’s what the social media companies are looking for, to protect themselves when a subscriber has to be blocked.

At the American Enterprise Institution’s Friday Conference on the 10th anniversary of the 2008 financial crisis, in addition to the keynote from Jeb Hensaling, Chairman of the House Financial Services Committee, speakers and panelists hail from AEI, Brookings Institution, Heritage Foundation, Harvard Law School, R Street Institute, QED Investors, Columbia Business School, as detailed at the URL provided in the Economic Calendar below. (Surprised that Sheila Barr didn’t show up in the agenda, or Boston Fed’s Rosengren, who feels smaller banks should have higher capital levels, because they represent the next likely hit, without any.)

Given the stereotype of "garmentos" being Jewish, it’s quite shocking to realize that the NY Designer Runway Shows were scheduled to run on the 9th, 10th, and 11th, Rosh Hashana, the Jewish New Year, during which Reformed Jews are supposed to pray on the 9th and until sundown on the 10th, while Conservative & Orthodox Jews will observe from Sunday on the 9th, to sundown on the 11th. Who bolluxed that scheduling? Some of the labels mounting shows on the 10th including The Row, Carolina Herrara, Leila Rose, 3.1 Phillip Lim, Proenza Schouler, Anna Sui and more. On the 11th, Alice_Olivia by Stacey Bendel, Vivienne Tam, Zang Toi, and Calvin Klein.

Speaking of fashion, the London Fashion Week will be fur-free. Of course, Paul McCartney’s daughter, Stella McCartney, a British designer, famously uses no fur or animal skins—not even for her handbags, yet charges prices in line with fur and exotic animal skins. She’s a Vegan. Last week, Burberry announced it would stop using fur, as well, following in the footsteps of many designers who made the same decision earlier. However, no fur doesn’t mean no animal skins, so expect designer shoes & handbags—if not pants, skirts, and coats—to continue to be made of animal skins. An make no mistake, the court of public opinion found Trump campaign manager Paul Mannafort guilty of horrible taste, after seeing his snakeskin jacket.

Remember the maxim I mentioned last week? Sell Rosh Hashana Buy Yom Kippur? The latter’s the18th, at sundown, through to sundown on the 19th.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)     

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

September 03—07, 2018    EVENT CALENDAR PICKS UP WHERE EARNINGS LEFT OFF      Holiday week, into the Jewish holiday of Rosh Hashana, the Jewish New Year. For that reason, alone, staffing will be a big question. Do some just take the week off, into what will be a 4-day weekend for Conservative & Orthodox Jews, 3-days for the Reformed. The old Maxim is Sell Rosh Hashana, BUY Yom Kippur, 8 days after Rosh Hashana ends. And that might just work out well, this year, as the comment period ends Friday, on an additional $200B worth of Chinese goods that must, ultimately, hit apparel & footwear makers, which have had a an impressively strong rebound. Should Trump turn up the screws on the additional $200B, it’s only US industries that will be hurt, since China doesn’t buy as much from the US as the US imports from China, so hasn’t another $200B to slap tariffs on, in retaliation. Chinese media already took the gloves off, moving from calling Trump "unpredictable" to "crazy," I’ve read. All in, appears the week could strain the bulls more than the bears, even before possible warnings from companies appearing at the ridiculous flood of investment banks scheduled for this week—starting Tuesday & Wednesday, in particular. Many will dial in from their porches and sun chairs on the beach, rather than attend the event, itself. With very high expectations for the coming earnings season, even as we’re barely 4 months from comping against this year’s first reduced taxes 18Q1, bulls have more to think about than the bears, making downside protection more attractive than it’s been in a while. .

Because of Rosh Hashana, next week’s Outlook will be "just the facts," like this week. Enjoy!

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinion expressed is the author’s, alone, and should be just one factor in more complete due diligence.   

August 27—31, 2018     SUMMER ENDING OFTEN TRIGGERS SELLING  as Mutual Fund Managers seek to jump the gun on Competitors Scraping up Tax Loss Selling Candidates  Fed Gov. Powell was the headliner at KC Fed Jackson Hole Symposium. The highest ranking central banker other than Powell was BoE’s Andrew Haldane. See full agenda, here. https://www.kansascityfed.org/publications/research/escp/symposiums/escp-2018 b Powell’s speech, Friday, never touched on the upper limit of rates—or the neutral rate--as some hoped. Instead, Powell defended continuing gradual rate hikes, despite the President’s protests, pin-pointing inflation targeting as key to central banks sticking to their plan even if inflation spikes or flags temporarily.

This is the key insight at the heart of the widespread adoption of inflation targeting by central banks in the wake of the Great Inflation. Anchored expectations give a central bank greater flexibility to stabilize both unemployment and inflation. When a central bank acts to stimulate the economy to bring down unemployment, inflation might push above the bank's inflation target. With expectations anchored, people expect the central bank to pursue policies that bring inflation back down, and longer-term inflation expectations do not rise. Thus, policy can be a bit more accommodative than if policymakers had to offset a rise in longer-term expectations.

Powell also defined the FOMC’s job succinctly, by pointing towards: "two risks I identified--moving too fast and needlessly shortening the expansion, versus moving too slowly and risking a destabilizing overheating." The latter, by the way, is exactly what Trump would have him do. (If for any reason the link provided doesn’t take you to Powell’s Friday speech, check in FOMC "recent postings" rather than speeches, the latter a month old with no sign of the Jackson Hole speech, when we sought the text.) I’m sure some are disappointed that Powell didn’t add anything to the conversation about the upper bound level of interest rates, in the current environment.

The Joint 33rd Annual European Economic Ass'n + 71st European Meeting of the Econometric Society Annual Congress (thru 31st, Cologne Germany) did not bowl me over by the portions of the program I read. I’m not enthusiastic about the speakers lined up for plenaries, lunch sessions, "invited" sessions, etc. And it doesn’t appear that the K.C. Fed’s Jackson Hole Symposium sucked the air & headliners out of a competitive Congress not sponsored by a central bank or one of its branches, either. Except for Powell, the Jackson Hole Symposium lacked headliners of its own. Other than Powell, former India central bank Gov. Rajan was the most high profile speaker, and he’s no longer a central banker—hasn’t been for a couple of years. ECB Economist Peter Praet is the highest ranking central banker I saw on either schedule—EEA or ESA.

Wolf Richter, who writes Wolf Street, noted the Fed used the word "strong" 32 times in its most recent meeting minutes, released on Wed. 08/22, representing the discussions and conclusions of its July 31st—Aug. 1st meeting. He says the word was scarce, rarely used more than 3—5 times even in 2005, another instance when the Fed was gung-ho on the economy. .

While I’m passing out props and keeping score, on last week’s schedule, I mentioned Altria’s habit of raising its dividend at its Aug. Board Meeting, annually. Sure enough, last week, MO raised its dividend by a bigger than I expected +14.0% to 80c p/sh quarterly, despite the steady decline in cigarette sales and the FDA requiring clinical studies for vaping and other digital cigarette products.

The highlight of this week may just be China’s July Industrial Profits, expected overnight Sunday, into the US Monday morning. We’ll get a 2nd look at the July International Trade Deficit, and Case Shiller’s 20-city Home Price Index for June (Tues0, as well AS NAR’s July Pending Home Sales Index (Wed.), and July Personal Income & Outlays + Savings (Thurs.). Within the 2nd look at Q2 GSP, Wednesday, will be the Fed’s favorite measure, PCE & Core PCE, as well as what’s likely to be hot Consumer Spending (Wed.). Of concern, Wednesday, is the Treasury’s auction of 7-year notes, a month before another interest rate hike is virtually a given. Longer duration Treasuries are not the world’s favorite pick—especially in front of additional rate hikes.

Retailers dominate the Earnings Calendar, which includes Best Buy and Tiffany, Tuesday, Brown Forman, Dicks Sporting Goods, and PVH Wednesday, Burlington Stores, Dollar General, Dollar Tree, Lululemon, and Ulta Salons Thursday, no one reporting, to my knowledge, on Friday, into the 3-day Labor Day weekend. But it’s nor just large retail chains reporting, this week, Hain Celestial and Hewlett-Packard Enterprise will report Tuesday, Salesforce.com Wednesday, Ambarella & Ciena Thursday, along with about a dozen other, smaller retailers.

As befits the week before a long holiday weekend, the Events Calendar is slim. Some of the most impactful news will come from across the Atlantic, at ESC, the European Society of Cardiology, where Amgen hs 6 presenters discussing the benefit of Repatha, and Pfizer plans to hold an analyst review of Tafamidis data. They won’t be alone but are the only 2 who are set up to notify me of investor meetings. Outside healthcare, Jefferies Semis, Hardware & Comm Infrastructure Conference, in Chicago, is likely to biggest event stateside, given the bull and bear debate on the Street about where Semi’s are in their cycle. Ambarella’s earnings release (Thus) won’t solve that debate.

Take a look at the video game releases on the 28th & 31st. You’d think a new video game console was being released this week but that’s not the case. It’s just a bunch of video game publishers hoping to snag the attention of kids and co-eds returning to public school & college, just as football season launches. With so much riding on video games, and eSports, especially—including the Barron’s cover story for the week—it appears video games and gamers are the antidote to the NFL. By the same token, it’s not totally surprising that the I-banks are setting up in Korea, Japan & China, just as the US Holiday weekend kicks off.

Which brings us to the title of this piece. The major indices all made new highs, last week, so it’s difficult to imagine a lot of tax-loss selling to be executed but given how much rotation there’s been between leading sectors, there are some losers of the past Quarter and year, whose shares are likely to be trimmed by Portfolio Managers seeking to offset some of the profits taken earlier this year. Most mutual funds close their year on Oct 31st, a scheme designed by Congress to limit the amount of tax loss selling that hits shares around the holidays, while also trying to assure there’s enough time for funds to pay their annual dividends passed through to shareholders, and for the funds to prepared the K-1’s, 1099’s, and other documents shareholders need to pay their estimated taxes for 2018, by Jan 15th, 2019. In the past decade, PM’s trying to get a jump on competitors’ tax-loss selling have started their own earlier, and earlier. Hence, some years there’s evidence of their selling in August but not this year. That leaves September as the last chance to get a head start. Forewarned is forearmed. It gets more dangerous from here on in, until mid-term elections, which themselves represent a big unanswered question as the swamp around himself that Trump attracted seems to close in on him, just as the 51st Republican Senator lies in state, at the capitol. Things like Cohen & Manafort don’t matter until they do, and with so many Trump execs and confidantes working out immunity from prosecution, how long before it matters?

P.S. We're unsure about preparing an outlook on Labor Day. Don't plan on it and be pleasantly surprised if it happens

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence. 

August 20—24, 2018   CENTRAL BANKERS WILL DOMINATE  From the Central Bank Research Association starting early Monday morning in Frankfurt, through the end of the week, when the Kansas City Fed will, again, host its Annual Jackson Hole Economic Symposium, central bankers will dominate. FOMC Chief Powell speaks Friday morning (10am et), on "Monetary Policy in a Changing Economy." As is typical of the K.C. Fed and other Federal Reserve conferences, the full list of speakers won’t be known until after the meeting starts. Surely, there are those who believe such secrecy is a measure of protection but, really? With Bloomberg, CNBC, and CNN setting up chairs & cameras outside the main meeting hotel? Ya think the terrorists couldn’t find the place, even if the schedule weren’t released until after the shindig ended?

The Central Bank Research Ass’n Meeting has an unusual format. Each of the central banks participating created their own topics, and held their own "Call for Papers," the selections then submitted to SAFE & CEBRA for the meeting agenda. The US Treasury’s auction calendar is slight, this week, which might also impact what the week should look like. The known headliner is the FOMC Aug. 1st Meeting Minutes, out Wednesday, the meeting at which the FOMC decided that there’ll be a press conference after every FOMC meeting, starting next year. Another topic of late, has been where the upper bound of rates now resides. Some think it’s a lot lower than it used to be but others say it’s a moving target that will keep rising as the US economy absorbs paced rate hikes without cracking. Also notable, housing information like Thursday’s FHFA June/Q2 House Price Index, and July New Home Sales.

The Earnings Calendar cranks up again, this week, with more major retailers that will move the weight of evidence for and against brick + mortar retail, one way or another. Tuesday, Coty, J Jill, Kohl’s, TJMaxx, Tuesday Morning, and Urban Outfitters will report. Away from retail, Medtronic & Red Robin Gourmet Bugers will out the day. On Wednesday, reports are expected from L Brands, Lowe’s, SteinMart, Target & Williams-Sonoma will report. On Thursday, Alibaba, Big Lots, Cato, Children’s Place, Citi Trends, Gap Stores, New York & Company, Ross Stores, and Stage Stores. Anf it that isn’t enough, also Thursday, Autodesk, Spam-maker Hormel, Hewleett-Packard, Intuit, Toro, & VMware. On Friday, The Buckle, FootLocker, and Hibbett Sports wrap up the week.

EnerCom stands out on the Events Calendar. It started Sunday, as I wrote in Denver. EnerCom is additionally supported by the many Street sponsors, as well as Wolfe Research’s EnerCom Event, and BAML’s Energy Bus Tour in Houston, starting the last day of EnerCom. Also notable, AV18-Autonomous Cars in Detroit, starting Monday, then the 7th NextGen Automotive Manufacturing: Lightweight Materials Summit, also in Detroit starting Tuesday. Then, also starting Tuesday, Automotive Cockpit HMI (Human-Machine Interaction). The latter is in Ann Arbor Michigan, not so far away that it won’t have overlapping attendees from the Detroit events.

But it really is the Central Bankers that will hold sway, particularly, the US’ own FOMC, starting with Wednesday’s meeting minutes, following through the K.C. Fed Jackson Hole Economic Symposium. The full weight of the speakers won’t be known until the full agenda is released, and that won’t occur until after the meeting starts, at 6pm mt on 8/23, to be exact, the K.C. Fed says. Keep your skis & skates nearby, since you might just have to slide into next weekend, if you insist on remaining as long as you were in April. Bear in mind, September is rarely kind to stocks.

ECONOMIC: (Highlights, only, here. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security., The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

August 13—17, 2018  LAST OF THE IMPORTANT EARNINGS RELEASES? Not Yet    The US Treasury is on a bit of a hiatus, after last week’s debt sales. This week, 3 & 6 month Bills, and 52-week Bills, but nothing longer. Notable data on the way include the NY Fed Bank’s 18Q2 Household Debt & Credit Report (Tues.), July US Retail Sales (Wed.), NAHB’s Aug Housing Market Index (Wed.), along with Q2 Productivity & Costs, and Jul US Industrial Production & Capacity Utilization, before the EIA releases weekly petroleum, gasoline, and distillate numbers. Thurs, July Housing Starts & Building Permits, along with the Philly Fed Outlook Survey. Friday, US Q2 eCommerce sales, along with Baker-Hughes weekly US/North American Rig Count. If anything, data from Canada, China, Japan & the UK might attract even more comment than the US data, since the S&P 500 is all the Street really needs to see, to decide what kind of impact Turkey’s lira collapse, or Trump’s latest tariffs will have on the US Economy.

The Earnings Calendar does get more interesting, with large retailers stepping up to the plate, starting with Home Depot on Tuesday, when Advance Auto Parts, Tapestry (formerly Coach), and Brinker International weigh in. Wednesday Macy*s leads off, with Cisco & NetApp additional highlights. Thursday, expect JCPenney, Nordstrom & Walmart but, also, away from retail, Applied Materials, Madison Square Garden, nVidia, and China’s JD.com. Friday, Deere is the only notable report and from the land of golf clubs and construction, I can tell you green lawnmowers are more prevalent than yellow construction machines, Deere rarely seen as often as now, while two nearby new community construction sites look more like Caterpillar dealerships than construction zones.

So let’s talk, for a moment about the big retail earnings teeing up for this week. I found both Nordstrom & Macy*s busier this year than last year but that was partially tied to how long teens and their parents had steered away from the mall. No sooner was the Back to School sales tax holiday over, than crowds in the mall disappeared for a week, before returning the week prior to school’s start—Monday, Aug. 13th, here. Part of the quick return stems from how restrictive Florida’s sales tax holiday appears, with school supplies limited to $15, and clothing, footwear, and "certain accessories" limited to $60. Well, $15 won’t even buy a decent calculator, while $60, in today’s world, won’t even buy most pairs of sneakers. There are states that exempt computers up to $4,500, which makes the Florida limits look silly, never mind stingy.

Big Events include the NY NOW Housewares show, formerly, the NY International Gift Fair, as well as MAGIC & WSA (World Shoe, in Las Vegas), which reinforces the prominence of retail, this week, throughout the calendars. Meanwhile, the I-banks are back, trying to seize an opportunity when competition is usually slight. So, Credit Suisse’s Basic materials, KeyBanc Global Technology Leadership, OpCo’s Newport Summit for Revolutionary Biotech, start Sunday, when brewers are feasting on 3 related meetings in San Diego. Tuesday, Citi Insurance 1x1 and Raymond James’ Park City Telecom Summit are small compared to World Show & MAGIC, and the many related events concurrent with the big shows. Tuesday, Citi hosts 1x1 MLP/Midstream Infrastructure will be fighting all the retailers & manufacturers at MAGIC. In New York, Instinet hosts Cloud Builders Summit, Susquehanna Energy, while Stephens embarks on a Mid-Atlantic Bank Field Trip, which will run into Wednesday, when Raymond James hosts energy, OpCo Midwest Corporate Day, Wedbush its PacGrow Healthcare Conference, along with GMA Grocery Manufacturers Leadership Forum, none, perhaps, with as big an impact as STR’s 10th Hotel Data Conference, in Nashville. STR, for those who don’t follow hotels closely, is the successor name to Smith’s Travel Research. If you saw what happened to Marriott Int’l, in recent days, then you know something is not going well in the sector, many not hesitating to blame the tweeter in chief, who they feel has driven away foreign tourists. Given America’s long time reputation as a safe haven, Trump’s rhetoric may be impacting tourism in ways no one anticipated. IF you own hotel shares, now may be a good time to re-examine your thesis.

And while you’re doing that, consider how a slump in foreign tourism might impact retailers like Macy*s (and its Bloomingdale’s division), as well as Tiffany, and other retailers who call NY, San Francisco, or Los Angeles their flagship locations. In fact, if history is any guide it might be time to start taking some profits—at least protect the downside—raising some cash to redeploy in October.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

August 06—10, 2018   SUMMER QUIET SOMETIMES MAKES FOR NOISY MARKETS   Equity markets usually ramp to a top, around this week, before sliding into September on a downward trajectory. Having said that, it’s worth mentioning how often this market has defied expectations, and done just what it made no sense to do, time and again. We’re already into a tit-for-tat trade war, that’s ramping to a crescendo, though you’d never know it by watching equities or bonds, for that matter. The hardest thing to do, for the past year, was to remain invested in winning stocks, yet that’s just what so many have done. And even more incredibly, after a 42 point decline, analysts are pointing to Facebook’s decline as the gift one should accept by laying down dollars to buy its shares. Well, I’m not here to recommend FB as a buy or sell but I do recommend you watch the Treasury’s weekly issuance, because after a light week, last week, the Treasury will try and sell 10 & 30-year debt, this week. Wednesday, the Treasury is offering $26B 10-year & on Thursday, $18B 30-year. What US long term debt is paying in the US can only be seen as attractive to an investor in Japan or Germany, where rates are nearly invisible or, even negative. But that doesn’t mean anyone from those countries would be comfortable locking up their money for 10 years, or worse yet, 30 years. So the debt markets are worth watching, this week.

Data will be of more interest this week, too, as PPI is out Thursday, & CPI on Friday. Many are almost "excited" to see inflation rising, evidently not students of what past Federal Reserve Banks did to tamp down budding inflation. Out of curiosity, I went from store to store in the mall, this past weekend, stopping in at any store advertising for help. What were they offering as pay? $7.25 p/hour plus commission, the commission doled out after minimum sales were accomplished. No wonder teens don’t have jobs this summer: who wants to worth for nothing? And, yes, I did try and account for my age by offering teens an opportunity to earn $5 by popping into stores advertising job openings, and report back what they were offered in pay. Each of them were offered as little as I was, and none of them said they’d work for that little pay. And that was during a busy weekend when shoppers were out to take advantage of Back to School sales tax holidays, albeit apparel and/or shoes topping at $75, and school "supplies" at $15. Still it was encouraging to see so many people shopping at the mall, exactly what the sales tax holiday is intended to spurt. But inflation? No signs of that in pay offers, and no signs in market prices for jeans, fleece, graphic tees or VANS.

Worldwide chip sales reached a record high in the second quarter, surging more than 20% from a year ago, the Semiconductor Industry Association said late Friday. In the second quarter, global sales rose 20.5% to $117.9 billion, or 6% sequentially

Wells Fargo & Co. disclosed in a filing Friday that unspecified U.S. government agencies are looking into the bank's use of low-income housing tax credits. "Federal government agencies have undertaken formal or informal inquiries or investigations" about how Wells Fargo applied for and used those credits. Analysts keep welcoming every DoJ settlement and recommending the shares. I wouldn’t bank there and certainly wouldn’t invest in such a tainted bank, and recommend ignoring any analyst who finds each settlement as an added reason to buy its shares.

The Earnings Calendar is only a smidge slower than it was last week—at least in terms of the number of reports expected. There are more consumer discretionary companies scheduled, from restaurants, to hoteliers, to shopping mall owners, radio station owners, and TV distributors. Some are renamed companies, like Priceline, now Booking.com, reporting Wednesday, even as the TV networks sliced and diced into half a dozen of more companies—Discovery & Liberty—will compete with Walt Disney, Viacom for analysts’ attention and investor dollars. And it’s not just American companies, as Netease, Sina, Weibo, & Yelp are expected to report, as well.

Which brings us to conferences, a schedule slimmed by summer vacations, with most I-banks on hiatus until September, some until November. The big events this week include Cowen’s Communications & Infrastructure Summit Monday, UBS Financial Services Conference starts Tuesday, the competition including Jefferies, offering Global Industrials, and Oppenheimer Co its Technology, Internet & Communications Conference. UBS’ Genomics 2.0 Summit, in Park City Utah, starting Tuesday, is likely to overshadow Needham’s Annual MedTech 1x1, & Leerink’s West Coast Biotech Bus Tour. It’s a mini flurry of I-bank meetings not to be repeated again, this month. Also Tuesday, the Annual Space & Missile Defense Conference is starting, subtitled "Space & Missile Defense… Sharpening the Military’s Competitive Edge," but, of course, let’s not forget Pres Trump now wants a new "space protection" military division to add to Army, Navy, Marines, and Air Force. Quite naturally, Space could absorb the Air Force or vice versa, space becoming a sub-division of the Air Force. But the concept doesn’t seem to rise to the same level as his Mexican border wall, so don’t start designing the new logo you’d like to see embroidered on patches consumers could buy at any of NASA’s operating launch sites that allow the public to tour.

I’ll give a nod to JPMorgan’s Auto Conference, the participants not much different from the ones that appeared at the European version, last month. Wednesday’s CanaccordGenuity’s 38th Annual Growth Conference, in Boston, promises microcaps that are too small for us to mention. Thursday, Morgan Stanley will host Telecom & Media, while Goldman Sachs hosts Power, Utilities, MLP & Pipeline Conference, both in New York.

And there you have it—a week in which Earnings presenters will dominate the news wires, with a gaggle of I-banks hosting clients at events that didn’t need to meet this week, specifically, but probably will because someone noticed how few I-bank conferences are held from June 30th to September 1st, and thought, so why not throw one ourselves? Of course Europe, forever walking to the beat of its own drummer, has made it so difficult for I-banks to get paid for their work, that most simply gave up organizing investment conferences., at all. If you’re sticking with equities it might be wise to buy some downside protection. September and October tend to be ugly months, even if August cruises through without a hitch.

ECONOMIC: (Highlights, only, below..Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.            

July 30—August 03, 2018    EARNINGS QUICK SAND THIS WEEK    Each Time One Hangs Up, There’s Another CEO On a Call     No economist has, yet, forecast the FOMC raising rates at the meeting this week. And that surprises me, a little, given how hell bent Powell is on gradual rates increases. Why wait for September? Especially with Trump threatening a shut down on the gov’t if he doesn’t get $5B for his Mexican border wall, which more than a few might remember he promised to get Mexico to pay for. Why demand any money from Congress if he thinks Mexico is going to pay for it? So look for FOMC speculation to dominate both before and after the meeting ends on August 1st. The BoJ also meets, this week, along with the BoE, and both the Brazilian & Mexican Monetary Policy Committees.

Funding for the National Flood Insurance program runs out on July 31st, at midnight. I sure hope congress manages to extend funding for the program, since I just paid for my policy; last week, and would hate to have to fight with the Federal Government to get my money back. The Economic Calendar boasts mainly Housing data, including NAR’s June Pending Home Sales on Monday, S&P/Case Shiller 20-city Home Price Index, Tuesday. Wednesday promises that FOMC post-Meeting statement, and June Personal Income & Spending, which includes a measure of PCE—Personal Consumption Expenditures, a Yellen favorite though we don’t really know whether Powell is inclined to look for something else. For now, he seems content with whatever Yellen used. Friday, the BLS releases the July Unemployment Report and, once again, participation should rise, as college graduates start circulating their resumes. The PMI indexes rarely matter as much as the ISM, since it releases more data then the PMI’s, including employment data.

Whoever said last week saw the peak number of companies reporting earnings doesn’t know what he’s talking about (looking at you Bob Pisani). This week is the crusher, with the number of reporting companies reaching a crescendo on Wednesday & Thursday. Though let’s not kid ourselves; the largest market cap company—Apple—reports on Tuesday afternoon, with the ability to make or break the S&P 500. The biggest problem with the Earnings Calendar, this week, was narrowing the tickers chosen to embolden. In the end, we did it with a wing and a prayer,

The Dept of Homeland Security’s July 31st Cybersecurity event in NY, boasts V.Pres Pence & Secretary of Homeland Security Kirstjen M. Nielsen, Secretary of Energy Rick Perry, FBI Director Christopher Wray, Commander, U.S. Cyber Command and Director, National Security Agency General Paul M. Nakasone, and top CEOs from the financial services, energy, information technology, and telecom sectors participating in the summit, along with some sending their CEOs, detailed here, attending but not necessarily speaking.. https://www.dhs.gov/news/2018/07/26/department-homeland-security-announces-national-cybersecurity-summit-participants.

When I prepare the Earnings Calendar, I often check a company’s IR site to confirm if they’re reporting on the schedule we have for them in the past. That’s how I came to ask why Sealed Air has a section on its Investor site titled, "Modern Slavery & Human trafficking?" Just asking cause it struck me as extremely odd, and not something I’ve seen on other IR sites. .

The Events Calendar is lighter than usual, in deference to a heavy Earnings Calendar, and due to respect for the summer months, when at best, PM’s my phone in from the beach or mountains but rarely line up for an industry conference. AACR/ASCO Methods in Clinical Cancer Research is in Vail Colorado, a location many PM’s and medical practitioners will be happy to travel to..World Shoe & Accessories Marketplace is preliminary to MAGIC. But maybe someone can explain to me whey IQPC hosts Automotive Seating Innovators in Novi Michigan, Monday, while the Center for Automotive Research (CAR) hosts its Management Meetings nearby in Traverse City Michigan but not together with Seating.

Needham & Stephens go where few I-banks are inclined to go in late July or August, to NY for a 7th Annual Industrial Technologies 1x1, and to Nashville for a healthcare Update Forum, respectively. The biggest news of the week may just be the Sales Tax Holidays starting on August 3rd, and running through the 5th, that will be held by 12 states, to mark Back to School sales. Some, like Florida, are so chintzy, you couldn’t even buy a decent backpack for the $15 is allows on school supplies. The $100 apparel allowance will buy a non-performance pair of sneakers and little else. For some camps, next weekend is parents weekend—at least for whichever ones didn’t host parents weekend last week. Either way, with the TV Critics Fall Press Tour underway, football season and the fall TV season can’t be far behind. That also means we’re nearing the period when Earnings releases transition to retailers, and volume on the exchanges shrivels to near nothing. Stocks often ride the Earnings season to a crescendo anywhere around the 5th of August, before PM’s lighten their load of equities in anticipation of equities dipping into October, and what’s likely to be a hard fought mid-term election season. In other words, get out while the getting is good.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

July 23—27, 2018    EARNINGS SHOULD DOMINATE, UNLESS TRUMP HAS OTHER PLANS   Existing Home Sales Monday, FHFA May House Price Index Tuesday, New Home Sales Wednesday, and Friday The 2nd guesstimate of Q2 GDP, which includes PCE, what Janet Yellen focused on for consumer inflation, Powell, not yet, specific about what he wants to see, other than to confirm Yellen’s yard sticks.

The ECB will announce its rate decision in the wee hours of Thursday morning-on the 26th in local time. The post-Meeting Mario Draghi press conference will bleed into pre-market hours Thursday, in the US. A secondary story of the week is the amount of debt the US Treasury is auctioning--$215B to be exact. By the time the week gets to Thursday, and the Treasury wants to sell $30B in 7-year Notes, the bond market could head for a convulsion--especially since the FOMC, and Powell in particular, during his testimony to Congress, is still talking up 4 rate hikes this year, which means there are still 2 more to go, so 2 more reasons to shun the 7-year auction.

Earnings are another story—likely the story of the week, given the tickers we emboldened ranging from Alphabet (GOOGL), to 3M Tuesday, when Biogen, Chubb, Lockheed Martin, Paccar, Sherwin Wiliams, Texas Instruments, UBS, and United Technology, along with both AT&T & Verizon. On Wednesday, AMD, Baidu, Barrick Gold, Boeing, Citrix, Coca-Cola, Facebook, Ford, GM, HCA, Mohawk, Mondelez, Nasdaq, NextEra, Norfolk Southern Rail, Norfolk Grumman, Qualcomm, STMicro, UPS, Visa, Waste Management, and Mattel, which was living a disaster before Toys R Us filed for bankruptcy.

Thursday, Allergan, Ally Financial, Altria, Amazon, AmBev, Amgen, Budweiser, Beazer Homes, Comcast, Conoco Phillips, Discover Financial Services, Fair Isaac (FICO), First Solar, Group 1 Automotive, Intel, KKR, Lam Research, MasterCard, McDonald’s, Newmont Mining, Republic Services, Royal Dutch Shell, Southwest Airlines, Spirit Air, Total, Taiwan Semiconductor, UnderArmour, Valero, Western Digital, and much more. Friday, Chevron, Colgate Palmolive, ExxonMobil, Merck, & Twitter. All in, every sector is represented, even in the selected tickers I’ve pulled out.

Sunday, both the Alzheimer’s Ass’n Int’l Conference & ASRS for Retina Specialists continue. Farnborough’s Air Show continues but it’s the part that’s open to the public, the airlines, defense ministers, and other big wigs already gone. Investment Bank conferences are mostly MIA, both due to summer & earnings season. Starting Sunday, PAYMENTS Institute, FAME, MODA & MRKET, aka Fashion Week in NY, for Ready to Wear. For the Curious: Reinhold Environmental APC & Wastewater PcUG Conference (Lexington KY thru 26th), PCUG stands for Pollution Control Users Group. The event involves FirstEnergy, Southern Co, Ameren, PacifiCirop, DTE Energy, Dominion, Duke Energy, Detroit Edison, SRP, East Kentucky Power Co-op, Dynergy, TVA, AEP, and more. In the same vein, CHRIE is the Council on Hotel, Restaurant & Institutional Education

South Atlantic Well Drillers Jubilee is not oil drilling but drilling for water, specifically ground water wells. In fact, the URL for the event is jubileewatershow.com US Geological Survey among the speakers, along with Franklin Electric, Phase Technologies, Pentair Flow Technologies, Goulds Water Technology but a strange schedule that shrunk each click I tried to zoom in. USDA Crops & Chemicals USA (Raleigh NC thru 25th) will surely touch on Florida’s Toxic Green algae coating on lakes & canals. While many think it’s caused by the extreme heat & humidity, along with Agricultural run-off, the Army Corps of Engineers are the convenient target, because they’re so worried about Lake Okeechobee’s locks & dams that the Corps regularly empties excess water into the Saint Lucie River and other estuaries. The Corps is responsible for toxic green algae? Probably some combination but much of its naturally occurring.

CIBC breaks the rules about I-banks, this week, hosting both Financial Institutions & a Data Center Tour. Both are in Toronto. Alphabet’s Google is hosting Cloud Next in San Francisco, thru the 27th, while Microsoft is hosting Media & Entertainment Day in NY, much of its delivered via its Xbox consoles. And that’s not the last we’ve heard from megacaps, either; Amazon hosts Alexa Dev Days in San Francisco, starting Wednesday, which is when the TV Critics Fall ’18 Tour begins with CTAM, including A+E Networks, Amazon, AMC Network, Audience, Britbos, Sony Crackle, Discovery, Hallmark Channel, AT&T’s HBO, National Geographic, Netflix, Rooster & Teeth (new to us, also), STARZ, now owned by LionsGate Entertainment (LGF.A), Viacom, and Alphabet’s Google’s YouTube, all in Los Angeles.. Next week, it will be the networks’ turn, most of that in New York.

Citigroup is hosting a Fixed Income Investor day, for those invested in its own bonds & preferred shares, Thursday. Friday, one of the biggest events of the year kicks off, World Congress on Heart Disease Scientific Sessions, in Boston. Also Friday, shareholders of both Walt Disney & 21st Century Fox get a chance to vote on Disney taking over Fox’s entertainment assets. No surprise that Disney doesn’t want Fox News, which often sounds like Donald Trump mouthpiece. Saturday, 2 of the world’s largest cancer organizations joint for Methods in Clinical Research, in Vail. World Shoe & the Accessories Marketplace Show, in Las Vegas are prelude to MAGIC, despite the RTW industry meeting in NY for FAME., MODA, & MRKET. The New York shows are more for holiday and cruise, Las Vegas for Spring 2019.

It’s hard to dismiss the bulls who’ve kept shares rising no matter what Trump and other world leaders throw at them. But if Trump is serious about trying to find a total $500B worth of goods to slap with tariffs—the sum total of all our trade with China—it could trigger a quick fall into recession. I don’t think that’s something he wants but do believe some of his advisors want just that, so he can, then, pull the country out of recession. Meantime, diplomacy is .foreign to Trump, who continually looks like a bull in a china shop who has no respect for the china, at all. And why should he? The china doesn’t read "TRUMP" which is the only thing he seems to understand. Regrettably, I think the US gets the raw side of the stick in dealing with China and some other countries but there are ways to get what you want, and it doesn’t seem Trump wants to try anything that gentle or benign. Stock investors should be prepared for a strong outflow of funds as smart money refuses to wait for all evidence of a trade war, rather than a skirmish. And despite Alcoa talking about added costs because it has smelters in Canada, there’s more speculation about what might happen, rather than concrete instances of company earnings badly hurt by tariffs to date. Be very careful out there, and start lightening up for the last hoorah into the first week of August.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

July 16—20, 2018   TUESDAY, July 17, FOMC Chief Powell Semi-Annual Testimony @ US Senate WEDNESDAY, July 18, FOMC Chief Powell Semi-Annual Testimony @ US House    Truth is, once Powell testifies on Tuesday, no one will be listening very closely except economic journalists, hoping to glean an additional morsel, or a reversal of some position they’ve concluded Powell didn’t mean to state. The Economic Report already appeared last Friday, so from here on in, the testimony will be about the inane questions Congresspeople ask.

And, then, there’s Earnings, the calendar still filled with banks that, mostly, are not included in our Calendars, because they’re neither major money center banks or the largest regionals—the only ones we cover, along with the odd foreign bank subject to Stress Tests & CCAR, with ADRs that make them tradable in the US. So who’s reporting? Monday, Bk of America, BlackRock, and Neftlix. Tuesday? CSX, Goldman Sachs, Interactive Brokers, J&J, Kinder Morgan, Omnicom, T-Mobile, United Airlines, and UnitedHealth. Wednesday: American Express, Canadian Pacific Rail, Crown Castle Int’l (Tower company, though so will the can maker), eBay, WW Grainger, IBM, Morgan Stanley, Northern Trust, Novartis, and Ericsson. Thursday: Alliance Data Systems, Bk of NY Mellon, BB&T, Blackstone, Capital One, Domino’s Pizza, E-Trade Financial, Intuitive Surgical, KeyBanc, Microsoft, Nucor, NVR, Philip Morris Int’l, PPG, Skyworks, Taiwan Semiconductor, Travelers, Union Pacific Railway. Friday, Baker Hughes A GE Company (for now), Honeywell, Kansas City Southern Rail, ManPower, Regions Financial, Schlumberger, Stanley-Works Black & Decker, State Street, SunTrust, VF Corp. Some wouldn’t have normally made this detailing but with tariffs enacted on metals, first, and other tariffs awaiting their 2 weeks on the Federal Register before being launched, a few names muscled into these details.

Then, there’s the Economic Calendar and, in particular, the testimony referred to in the title of this piece. Last week, both Bostic & Harker backed only one more hike, and seem more concerned than Powell about what tariffs could do to suppress the economy. I had anticipated a draw, the week of July 4th but if I told you the US Reported crude supplies drawn down by (-12.6m) barrels, would you have expected E&P’s, and Oil, itself, to tumble? Granted July 4th holiday was included in the week reported, a big driving holiday, even if one’s doing nothing but day tripping to the nearest beach & fireworks display. But still, that was a monster draw, and a reaction that was inexplicable—even if Libya will be able to resume exports at its eastern ports. Seeing that reversed with a largish build, this week, wouldn’t surprise, at all. What surprises is Donald Trump’s reaction to the recent rise in crude, Brent nearing $80 and WTI comfortably in the $70’s, until last week’s pullback. But pump prices—currently $2.89 for regular, and $3.76 for high test—is hardly at a panic price. Scarier, IMO, is the fact that Gov’t tax receipts are way down, on the December tax cut, even as spending has gone up considerably. If the price of anything should be panicking Trump it should be the cost to service the US debt. As it is, the Treasury, Tuesday, intends to offer $51B 3-month bills, & $45B 6-month bills, the largest short term debt offerings I can remember over the last 43 years. And there’s a degree of sheer stupidity to be cranking up the short term issuance, rather than longer term dated debt, to capture what are still relatively low rates.

If last week’s NATO, and Trump’s upcoming summit with Russia’s Putin weren’t enough, the G20 Finance & Central Bank Governors are expected to meet in Buenos Aires, Thursday through next Sunday. That’s a ton of international interaction bunched together, the only upside being G20 heads of state are not scheduled yet.

The Summit on Sports Gambling (Cleveland OH) is the pre-conference workshop to the Nat’l Conference on Problem Gambling. The Investment Banking industry—NIBA, meets in NY Monday, when the Farnborough Airshow (UK) opens for bigwigs and, ironically, AAAE for Airport Execs meets, too, but in Atlanta. SSA for the Shareholder Services Association starts Tuesday, an event that’s often at odds with NIBA. Note both the Amazon AWS Summit & Oracle’s Uber (Ultimate) Java Conference start on Tuesday, in separate cities, though, NY & Denver, respectively. Tuesday also happens to be the full day Amazon Prime day, which will start at noon on Monday. For those unfamiliar, Prime Day grew out of a marketing coup Bezo created to preempt some sales from Alibaba’s Single Day, always held 11/11. Was that why the mall’s have been painfully empty since the weekend after July 4th? Or was it World Cup & Wimbledon watching? Hats off to France, Angelique Kerber, & Novak Djocovic for winning the Cup, and Wimbledon Women’s & Men’s Championships, respectively.

The Events Calendar is thin because analysts & PM’s are involved in the Earnings Calendar. Still, in addition to AWS & Uber Java, Softbank World will start Thursday, in Tokyo, while the original Comic-Con meets in San Diego, starting Thursday, even as Major League Baseball hosts its 89th All-Star Game on Tuesday, If you own Biiogen and/or Eisai, you’ll want to prepare for the Alzheimer’s Association International Conference, in Chicago, starting this coming Friday. After BIIB surged 15% plus, a few analysts were quietly criticized as thin, the data upon which BIIB made very bullish blue-sky comments. And it wouldn’t have been the first biotech or pharma to have announced extremely encouraging clinical trials data in a potential Alzheimer’s drug, only to be forced to not only reverse the comments but, often, pulled the very trials upon which the original comments were made, and cease development of the molecular, altogether.

Stocks often dippy-do during the 2nd week of earnings season, which is where this week falls. It’s not usually a fatal pullback, with stocks often on their way to new highs by August 5th, as traders & PM’s conclude earnings were better than feared. This Earnings Season suffers from a dangerous fault—the big growth in earnings expected that won’t be matched by outlooks. And worse, the closer we get to the end of the year, the closer markets get to comping against the first year of deep tax cuts, which are contributing greatly to results. Once a year has passed, there won’t be tax cuts to boost corporate earnings results, and it’s certain operating earnings won’t be a 1 for 1 offset. Then, of course, there’s the probable trade war Trump has launched which markets, for now, are ignoring. Trump doesn’t like to back down, though doesn’t seem troubled by reversing himself over the space of a few hours. Still, he’s proven hard to read, hard to predict, and harder to pin down, which might take the trade war deeper into hurting the economy than even he’s willing to observe, to get his desired result. Truth is, China doesn’t import enough from the US to match Trump’s proposed tariffs tit-for-tat, on an additional $200B in US goods. And, no, I don’t think the Chinese merely dump their US Treasuries, wholesale, because that would hurt their finances more than it would ours. Given how much lower US Tax receipts are proving after tax cuts, and the larger tranches of debt the US Treasury must offer to compensate for the cash shortfall, Chinese selling would lower rates, which might be good in the most intermediate terms, if the Treasury only proves wise enough to capitalize on the lower rates. It hasn’t been before so little reason it would be this time. But either way, it’s possible the US Markets are in the August 2007 denial phase, reality yet to arrive and pull the rug out form under bulls who, for now, control the markets.

ECONOMIC: (Highlights only, below. Full International Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be only one facet of more complete due diligence.

July 09—13, 2018    EYES OVERSEAS THIS WEEK      Donchya hate when there’s a Friday the 13th, just as US banks start reporting Q2 Eps? Most on them on the 13th? Just doesn’t feel especially promising. And to make matters worse, Pres. Trump, who has offended those nations that are supposed to be our closest allies, with tariffs on products they exports to the US, and will have the opportunity, thanks to a NATO Summit, to offend those leaders, again, face to face. Just what markets need, right ? (Being Facetious, here, folks!!!) Wanna know if consumers have been impacted by rude behavior towards supposed allies? Watch Consumer Credit (really the growth in consumer debt), just not as soon as the May data coming on Monday. But small businesses may voice their concern in Tuesday’s NFIB Optimism Index. Then, prepare for Wednesday’s PPI & Thursday’s CPI, to reflect higher crude oil prices, even if price gains at the pump have lagged gains in crude, itself.

The Bank of Canada is meeting and expected to announce a rate increase on Wednesday. Quite quaintly, the Chief, Gov. Poloz is almost always accompanied by his deputy governor, Wilkins, every time he hosts a post-meeting press conference. Then, don’t be surprised if BoE chief Carney discusses a desire to start tightening rates, soon, when he speaks on Wednesday. Do US tariffs mix up the best of plans? Sure do, if the minutes from the FOMC’s last meeting, released last Thursday are any indication. They haven’t, yet stopped the FOMC but still could by the time they next meet at the very end of the month—depending on how far along tit-for-tat tariffs rise, by then. Wednesday afternoon, John Williams will debut at his first regional meeting with government, business leaders and residents, when he comes out as the new Pres of the NY Federal Reserve, in Brooklyn, at 4:30pm. Because the NY Fed has a permanent vote on the FOMC Monetary Policy Committee, the Pres of the NY Fed is one of the most important members of the FOMC, always. PLUS, since he followed Janet Yellen in San Francisco, when she left the presidency of that Fed Bank to lead the entire MPC, he’s probably not all that dramatically positioned compared to Yellen. He’s gotta know the ridiculous home prices in San Francisco, Marin County, San Jose, etc, are not indicative of what’s happening in the rest of the country—just indicative of the influence the big tech companies and their employees have on pricing there. And it’s always been the same—even back when Intel and Hewlett-Packard were the biggest kahuna in tech. It may be worse now but even in the early 80’s, hovels in San Francisco sold for a minimum of $600k, even in the Mission District, besotted by drunks and homeless.

A little curious about Neal Kashkari’s speech on Immigration Thursday at 8pm. He is not afraid to speak out and criticize higher ups, when he feels it’s justified. And no matter where you stand on illegals entering the country, separating 2 year olds from a parent can’t possibly sit well with anyone. For the record, I’m not concentrating on the 10th Rocky Mountain Economic Summit on the 12th & 13th, despite Street luminaries like David Kotok of Cumberland Advisors moderating a few sessions because the entire event is operated under Chatham House Rules. That means no speaker can be identified with what he/she said; nothing is for attribution. Still, there are luminaries a keynotes from Dallas Fed President Patrick Harker. On the one hand, he must be thrilled to see higher crude prices clearing up a lot of weak oil company balance sheets but on the other, Texas is ground zero for illegal immigrant entry, which has to be a strain on his state’s budget. Then, since he can’t be quoted verbatim, he might very well discuss how he sees tariffs impacting the job of the Fed.

Earnings Season starts this week, with PepsiCo on Tuesday, Delta Airlines on Wednesday, and a crop of banks Friday, including Citi, JPMorgan, PNC Financial, & Wells Fargo. Like many, I was surprised that the Fed didn’t use either the stress tests of C-Car to penalize Wells in any way, after Yellen’s parting slap last February. Maybe the Fed, FDIC & OCC think Wells has finally learned its lesson about short cuts and pressure to get its employees to open new accounts. I will say that after the Stress Tests & C-Car results failed to boost financials, I’m not at all sure, now, that even stupendous earnings will do that trick.

The Events Calendar promises Semicon West, and presumably, the Allen & Co Annual billionaires outing. At one time a media hotspot, convergence long ago dissolved the perimeter around media. NOW, though, with Comcast & Disney dueling for Foxa & Sky TV, being a fly on the wall of the Allen & Co meeting should be prime viewing. Of some passing interest, the AGA (American Gas Association) presentation to the Philadelphia Securities Association Luncheon. If you find yourself in Brooklyn, perhaps to hear NY Fed Pres. Williams’ speech, be aware that The Forumla E ePrix takes place in that borough, the 12th through 15th. A lot more fun than watching Trump elbow his way to the front of the photo, pushing aside other world leaders who, for the moment, may have no use for him, at all. As for the rally, I expect one more big push towards a high around August 5th, I’m not sure this is the week to expect that swoosh. Keep reminding yourself its summer, with volumes low, and futures able to push stocks around more than usual.

ECONOMIC: (Highlights, only, below. Full International Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.  

July 2nd—6th, 2018   TARIFF DAMAGE ABOUT TO HIT HOME?   On June 14, 2017, the FOMC laid out its plans to roll off Treasuries & Agency debt it had accumulated through several rounds of QE. However, a close read of the roll off plan announced then, implementation to begin in September 2017, laid out increases in the amount allowed to roll off over 12 months, only. That means, at some time in the very near future, likely at the July 31st meeting that will end on August 1st. Initially, for the first 12 month period, the Fed set $6B in Treasuries to run off for 3 months, the amount to increase in steps of $6B, until it reaches $30B per month. Right now, the Fed should be at $24B, as of July 1st, and will rise to $30 by September. For Payments of Principal from its holdings of agency debt & mortgage backed securities, the Fed set out $4B monthly to initially roll off, the amount rising in steps of $4B at 3 month intervals, until it reaches $20B over 12 months, which will, also, be by September. And in a footnote to the June 14, 2017 FOMC Meeting addendum to the Policy Normalization Principles & Plans, not many have read, what was laid out on June 14, 2017, was a recap of a plan first adopted at a meeting on September 16, 2014, the only news being when it was implemented.

Now, the FOMC did say that it intended to see its automatic roll off remain at the caps placed on them--$30B for Treasuries, $20B for Agency debt & MBS, so that the Federal Reserve’s Securities Holdings will continue to decline in a gradual and predictable manner until the Committee judges that the Federal Reserve is holding no more securities than necessary to implement monetary policy efficiently and effectively. Still, Powell, and the two very hawkish female FOMC members seem really eager to get the tightening going, so an acceleration of the background run-off wouldn’t surprise me, at least. Trump starting a trade war was never something anticipated by the Federal Reserve. Not only will Trump’s tariffs raise the prices of many things consumers use but will artificially but nonetheless push up inflation, which would encourage the FOMC to tighten more quickly—or at least move off neutral, or wherever they’re at right now. So, as the anniversary of the roll off approaches, in September, what the FOMC intends to do with the roll off should be mentioned, side by side with rate setting, even though the FOMC did clearly state that toying with rates was its main tool for setting monetary policy.

What better time than fresh off the Stress Tests & CCAR to note the US system used to rate banks is called "Camels. "That stands for "Capital Adequacy, Asset quality, Management, Earnings, Liquidity, and Sensitivity to market risk." I thought that not only cute but educational. After some 40 years in the biz, albeit following equities, not debt, it’s never too long before I read or hear something new to surprise me.

Back in July 2016, NBCUniversal (CMCSA) acquired rights to the ‘Harry Potter’ series & other current & future Warner Bros Films (T), as of July 1st, 2018. It’s fair to question whether T will try to buy out CMCSA’s rights. AT&T wasted no time getting a postcard out to all its customers, notifying them of the new relationship with Time Warner, now Warner Media, and that means T is able to cross market Time Warner & AT&T customers’ information back and forth. Precisely, "AT&T Companies share your information with each other. With our merger, WarnerMedia is not included. This will mean great deals, relevant offers and new ways for you to enjoy premium content from Turner, HBO and Warner Bros." Something else that caught my eye last week, for the first time: Who’s the UBS Retail Analyst, talking about Nike results? Jay SOLE. What were the odds? Do you ever wonder, If July 4th is the day the U.S. Declared Independence from Britain, why isn’t that day some kind of holiday there—something along the lines of ‘shrinking kingdom day of depression? Of mourning?’ Something—anything to recognize Britain’s New World Loss!

TECSYS (TSX TCS) is a Canadian software company that will report on Thursday, after the bell, but will hold its conference call the next morning, Friday, at 8:30am et. I mention it only because Barron’s noted TCS would host its conference call Friday, without pointing out that the release will arrive the night prior. Frankly, hats off TCS’ PR firm. I’d never heard of them before, had you?

The week will be filled with the first trickling of June data, including the PMIs, ISMs, Motor Vehicle Sales, and the all important June Unemployment Report, out Friday. It’s also a time frame known for portfolio rebalancing, and taking a little off the table—especially if one is invested in any sector that should suffer from US tariffs and global retaliation. And perhaps I should change my mind and name June Motor Vehicle Sales as the all important June datapoint out with week, because the group might be suffering a touch of whiplash given all the tariffs, retaliatory tariffs, and the retaliatory tit-for-tat tariffs being described, threatened, and in some cases, about to be levied, as of this Friday. One would hope that Thursday’s FOMC Minutes of the June 12—13th meeting would have noted tariffs levied and threatened, and the dangerous pressure they could exert on manufacturing companies—the automakers, especially. And, not that I wish New England lobstermen any harm but I will be very glad if China’s new, 25% tariff on US seafood, including Lobsters, brings down the cost of a lobster dinner in the US. After years of paying between $13.95--$18.95 for a one pound lobster, the price suddenly rose to $28—37, a couple of years ago, because Maine did such a splendid job marketing lobster to the Chinese. I would love to see retail & restaurant prices lower, again.

Note that markets close early, Tuesday, on the Black Friday schedule, with equities closing at 1pm et, bonds at 2pm et. With a holiday Wednesday, then only 2 days left until the weekend, new tariffs being initiated, on Friday, Q2 results to be announced, starting in the middle of this month, may take a back seat to warnings about Q3 earnings if the tariffs are assessed as discussed. And really, back and forth tariffs become a game of who’s on top, spiraling to a point where global trade comes to a halt, as countries are restricted in some way against every country. Does Trump really think he can drop out of the Iran nuclear agreement, and force other countries making no changes to the agreement they signed drop all business with the country? Because Trump says so? I think it’s fair to say the countries Trump has gone out of his way to humiliate are ready to defy his orders—instead abide by the treaties they signed, even if Trump pulls the U.S. out. Megalomania is an ugly trait to confront and rarely admitted by the person exerting all the signs.

From where I sit, the question isn’t whether tariffs are getting out of control but, rather, why have the markets so calmly accepted, until now, the vicious cycle the US kicked off? Don’t be surprised if all hell breaks loose, now--prepare for the worst and be pleasantly surprised if something milder grips the equity markets.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions are the author’s, alone, and should be just one factor in more complete due diligence.

June 25—29, 2018   Comprehensive Capital Analysis and Review   The Federal Reserve, FDIC & OCC don’t release the results of the CCAR until Thursday, after hours. However, historically, banks have announced their intentions to raise their dividends & buybacks, as soon as Wednesday and, once, on the Tuesday before the release of the results. The Federal Reserve discusses the results with the banks & holding companies subject to the review, before the results are released to the rest of the world. The results determine the extent of the capital return plans regulators will permit. Because banks know prior to release of the actual results, on Thursday, after the close, most rush out announcement of their capital plans, like proud parents who’ve learned their kid got into Harvard. You might recall a few banks, last year, announcing capital plans that were below their previously stated objectives, earlier in the year. That was the result of input from the regulators who control how much the banks & holding companies can disburse. On the other hand, Goldman Sachs has had a habit of not releasing any capital news, in the week during which the CCAR results are out. Hewing to the fact that it’s up to the board of directors, GS waits until the directors have met and voted on a course of action, before announcing updated capital plans. For that reason, GS has often underperformed other banks, JPM & MS, in particular. You’d think the Street would be wise to GS’ methods, by now, but somehow, it’s always news to them.

The Economic Calendar also promises hosuing data, like Monday’s May New Home sales, Tuesday’s S&P Case Shiller CoreLogic April 20-city Home Price Index. Does anyone else wonder why the Street is so spellbound by data that old, in an age of lightening fast computers? Wednesday, May Durable Goods Orders & Shipments, the May International Trade Deficit, which might prompt a tweet storm from the #1 disser of current International trade balances. Also Wednesday, May Pending Home Sales from the Nat’l Ass’n of Realtors, EIA’s weekly Petroleum stats, and Fed Vice Chair for Supervision, Quarles, speaking at the UBA 110th Conference, starting 9:20am, presumably, local time, in Sun Valley ID, though that was not specified on the agenda. What the heck is that, you might rightly ask? Well, that’s the Utah Bankers Ass’n, the state a favorite for what’s referred to as "industrial" banks—banks that serve a solitary business of a certain industry or company. Industrial Banks may be Home Depot’s credit card business, or IBM’s employee credit union. Licenses for new Industrial banks haven’t been issued since the 2007 crisis, and worse, at least for a friend of mine, was the fact that the Fed’s simultaneously kept a tight grip on license transfers, so friend with a Utah industrial Bank that negotiated a $400m cash sale was nixed by the regulators. His wife waited another 9 years for a divorce, by which time he’d raised the cash he needed to be freed, while she lowered her sights on how many millions she felt she was entitled to, that license still not transferred to anyone new, though additional partners were allowed in. Fed’s Rosengren is delivering the John Olcay Lecture on a topic that still has me scratching my head: "Is the Economy too Sensitive to Economic Downturns?" Surely I jest, you’re thinking but I’m dead serious. The Peterson Institute is responsible for the topic, as host. Also Wednesday, the Treasury’s auction of 5-year Notes, at 1pm, may not go well, so it’s something to keep in the back of your mind. Likewise, Thursday’s auction of 7-year Treasuries may be even worse. Of course, CCAR results out after hours might heal any Treasury wounds. And at the least, mark your calendar for Friday, because that’s the end of the trading month, quarter, and half-year. If you’re trading the Russell indices, I’m sure you don’t need me to remind you that, on the 26th, FTSE Russell’s reconstituted Russell indices debut on open, which is, also, when the Dow Jones Industrial Average will be reconstituted, GE out & Walgreens Boots Alliance inserted in its stead. Walgreens merged with Boots, a European pharmacy chain, that makes up almost half of sales. I’m sure that’s why it was chosen over CVS Caremark, even as CVS is waiting for regulators to approve its buy of Aetna. Still, many think WBA was a bad choice, altogether, preferring another tech-dependent name. Maybe when they replace IBM they can fill that spot with another tech company.

Turkey held an election this Sunday. Current President, Recep Tayyip Erdogan, won as expected, his victory accompanied with complaints that the elections were rigged. The EU is holding a summit on immigration, this week, with Hungary, Poland, and the Czech Republic not attending because they don’t like the theme—more equal sharing of migrants.

The event of the week may be Goldman Sachs’ 14th European Business Services, Transport & Leisure Conference, starting Monday, its London location no hindrance. On Monday, the AIAA starts its 2018 Aviation Forum, in Atlanta. Ste3phens begins its Airline Investor Trip in Atlanta, the following day, and will have dropped in on Delta, Spirit Airways, American Airlines & United Airlines, ending up in Chicago on the 27th. Jefferies hosts a Steel Conference one day prior to earnings releases from Schnitzer Steel & Worthington, both of which report on Tuesday--both beneficiaries of Trump’s tariffs on steel. You’ll note that most of the I-bank events this week are occurring overseas. That’s because this is the week before the July 4th celebrations will break up the first week in July. Major tech companies will come together on Friday, for the US-China A.I. Summit at Half Moon Bay, in California. That’s a day after JPMorgan’s NextGen Payment Services Forum, and Berenberg’s Blockchain Conference, on opposite coasts.

The movies opening Friday leave much to be desired. The Red Sox vs Yankees 2-game interlude, in London, could be better watching than the movies debuting, that surely account for the big hits already opened and running strong. Then, again, you could just hop down to Walt Disney’s Hollywood Studios, in Orlando, for the launch of "Toy Story Land." Happy hunting into the end of the month, quarter, and half-year. The worst months of the year started in May. I expect one more spike into August 5th, or so, as Q2 Earnings Reports don’t surprise. But by the time we’re into August, the Street will start looking ahead to 2019, and that’s when the trouble should begin. And you could always pop into Old Navy (GPS), where flip-flops are being advertised for $1 p/pair, a fairly regular July 4th promotion for the chain. Pandora Jewelers (PANDY) offered 45% off about 2% of its merchandise, a bigger promotion than typical. And don’t be misled by how small a percentage of its overall merchandise the sale component represents. Two percent is, still, well over 500 pieces. And, unlike some of its pendants, which require a separate purchase of the chain, a few of the pendants in the 45% promotion come with the chain. So, a chain & 2 star pendants that retail for $90, were reduced to $52 with sales tax included, when the chain, alone, usually costs more than that. Still, the mall store wasn’t as jammed as one might have expected, on the last Saturday of the sale, even though the mall was still enjoying the better traffic that showed up in Q1. That may say more about shoppers’ ability to snub their noses at any sale that isn’t at least 50% off, most in the past week 50% off plus an additional 10—25% off, except at Banana Republic, where it was an additional 40% off merchandise already discounted by 50%. Gap divisions are pulling out all the stops for business, and not getting as much response as might be hoped.

ECONOMIC:(Highlights, only, below. Full International Economic Calendar is here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, along, and should be just one factor in more complete due diligence. 

June 18—22, 2018  CENTRAL BANKERS AGAIN DOMINATE UNTIL THURSDAY.   That’s Stress Test Results Day on Market Close    Megabank& Financial Holding Company Stress Tests will be released after the Close (4:30pm et). The market may well act like that’s the whole story and nothing but the story. Of course, the rest of the world may suspect the CCAR out a week later are more important, because CCAR decides the level that dividends & buybacks can rise to. But, of course, that’s not all because the New York Federal Reserve Bank welcomes its new leader, John Williams, previously from the San Francisco Fed, who’s scheduled to be in NY on Monday. And not just arrive quietly. Instead, the NY Fed is hosting an event, Monday, that until now NY Fed CEO/Pres William Dudley will open with "Reforming Culture & Behavior in the Financial Services Industry: Progress, Challenges, & the Next Generation of Leaders. Williams will close the event, at 4pm, with remarks on "Financial Services Industry Culture," a passing of the baton, if you will, from departing Dudley in the morning, to Williams right as the market closes. In between, Dudley and a former Fed Governor, Elizabeth Duke, currently atop the Board at Wells Fargo, will be panelists. Duke, for the record, was the first female board member at WFC, replacing the Wells Chairman Stephen Sanger, in August 2017.

But, I digressed: The day-long, New York Fed conference, is not all we’ll hear from the Fed. On Wednesday, ECB’s Draghi, FOMC Chief Powell, BoJ’s Kuroda, & RBA’s Lowe will all speak on a Central Bank panel, at the ECB’s Central Banking Forum, in Sintra Portugal, which will run through the 21st. And while we’re at it, the Swiss National Bank’s Monetary Policy Committee (MPC) meets, also Wednesday, its leader, Jordan, will host a post-Meeting Press Conference. Norges Bank, Norway’s central bank, issues an interest rate decision, as well. So too will the Bk of England, the sole central bank that releases its minutes at the time it releases its MPC statement, at the conclusion of the meeting. Mark Carney, the BoE chief, will host a post-Meeting press conference of his own, which usually occurs late enough in London to occur not long before the US markets open—late enough in the British business day that Bloomberg often broadcasts it to the early morning crowd. And just to finish the last of the Central Banking news worth knowing, be aware that Esther George (vocal hawk) is the alternate who will replace the absent San Francisco Fed president, voting at future FOMC Meetings. That places one of the most outspoken rate hawks in voting position 6 months before she would have, ordinarily, rotated into a vote, only the second time an alternate has stepped up to the plate. Given that Janet Yellen was the San Francisco Fed President prior to becoming the FOMC Chief, and Wiliams is moving into the New York Fed Monday, taking over from William Dudley, who is retiring, it appears that the San Francisco Fed’s profile is rising strongly. (For the record: The last time the rule requiring an alternate member to vote at the Fed was triggered was in 2006, when St. Louis Fed Bank President William Poole voted twice in lieu of the Atlanta Fed President, as that spot was vacant.

The other organized body that should be watched is OPEC. It’s holding the 7th Petroleum Seminar, starting on Wednesday, the 20th, in Vienna Austria, that will run through the 21st. Then, on the 22nd, OPEC will hold its 174th (Ordinary) OPEC Meeting, at its headquarters in Vienna. Of course, with a 2-day global meeting Petrol meeting preceding the regular meeting on the 22nd, it’s possible all the horse trading on easing the production cuts will have been concluded by the time the "regular" meeting takes place—a rise in production recognition that Venezuela & Iran’s production are too erratic to count into daily totals.

With all the hoopla about autonomous vehicles, there are few industry events as important as the SAE Automated & Connected Vehicle Systems Testing Symposium (06/19—21), taking place at the Clemson University International Center for Automotive Research (CU-ICAR), in Greenville SC. Virginia Tech, which first detected the VW emissions defeat software is the opening presenter, offering group leaders from its Truck & Bus Safety Transportation Institute, along with PACCAR’s Peterbilt Motors, and dealer Local Motors (Nat’l Harbor MD), in addition to the hosts. With many University-based speakers, side-by-side with corporate speakers, and the US Dept of Transportation, the symposium reads like the cross section of all autonomous undertakings.. And, in addition to companies like Metamoto, SGS Transportation, BMW Group, Ford Motor Co, Fiat Chrysler Automobile, Toyota, NHTSA (Transportation Safety Agency), Michelin No. Am, TUV SUD, Robotics Research Corp, and TNO, tech companies like Intel are fewer and farther between than one might guess but, also, features the unexpected, like Shanghai Int’l Automobile City—"A NICE City." Then again, it felt like 2 of the biggest elephants in the room are missing—perhaps 3, if one adds GM to Tesla & Panasonic, the latter’s batteries running almost all the prototypes & vehicles already being tested.

Then again, it’s surprising how few times Tesla’s sister solar company gets mentioned, even as California is mandating that all residences built starting in 2020 must have solar panels. PV Production & InterSolar Europe, will be held in Munich, starting in Wednesday. In the past, it was so well covered, and stocks involved shot up so high, the event might as well have been in the US. But nOW, even with California forcing builders to include solar power in new homes, Pres. Trump slapping tariffs willy nilly on everything the US imports or produces—the latter to protect US companies producing the tariffed items--the news out of InterSolar may be like that adorable puppy in the window your heart yearns to take home but Daddy says you can't have. For what it’s worth, 2 solar companies are reporting this week: Jaso on Monday, Rene Sola on Wednesday. Otherwise, Earnings Reports are expected from high profile tech companies (ORCL, MY, RHT), consumer companies (BKS, FDI, FINL, KR, KMX, CCL), and companies who will be badly hurt by tariffs on steel & aluminum: Winnebago & Steelcase. Ultimately, of course, CarMax could benefit, short-term from metal tariffs, since they’ll increase the selling price of all vehicles, and could make smaller vehicles more popular than they’ve been in recent years, when pick-up trucks & SUV’s were all shoppers wanted to buy. And the more expensive new vehicles become, the better KMX can do with an inventory of off-lease sedans few have wanted until now. Same thing must have happened with Deutsche Bank’s AutoTech Day, in London, Friday.

Which brings us to the rest of the week’s Events, none of which will rouse the Street as much as the ones already mentioned, though Tuesday stands out for me. Jefferies is hosting a Consumer Conference, in Nantucket, on the Cape, Oppenheimer is hosting its 18th Annual Consumer Conference (Boston), while CIBC is hosting a Retail & Consumer Small Cap Forum, too, even as it’s hard to see Amazon’s Alexa Dev Day (Toronto), on the same day, as anything but a consumer event, given Alexa has been targeting consumers, above all else. As more and more developers write software for Alexa, the Amazon ecosystem—and Prime—become harder to leave, as Apple surely knew from the get go, with iPhone. Just why so many I-banks woke up some 6 of 8 months ago, and decided they’d cover consumers, on June 19th, is beyond me but that what must have happened for them all to be scheduled simultaneously, CIBC & Amazon’s Alexa single day events, unlike the others that will end on the 20th.

Then, again, did I mention the Megabank Stress Tests are out Thursday, after the close? I did, but perhaps too many lines ago. And it might pay to bear in mind that trade opens Monday, after last Friday’s quadruple witching expiration, which often sees stocks rise for about 18 minutes, before they reverse course and sell off, sometimes steeply. What happens by the end of the day is usually the direction worth following for the next few days—though I’d be surprised if bets on Thursday aren’t to the upside, in advance of release of the Stress Tests. Failing grades for an Ally Bank, as happened previously, won’t upset most applecarts. Then again, don’t ignore the housing data out Monday, Tuesday, Wednesday, & Thursday, either, though watching rates might serve your purposes well, in that case.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security.. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

June 11—15, 2018    FOMC MEETS for the Quarter Point Hike the STREET AWAITS, & that’s not even half the story, cause so do the ECB & BoJ!     Trump meeting with the North Korean dictator on the 12th, the FOMC meeting Quarter point hike expected on the 13th, everything else on both ends of those two days likely to be more noise than substance. Yes, last week’s break out took me by the surprise but the coming rate hike is likely to stall out the rally—no matter how well anticipated it is in advance. Jerome Powell’s 2nd post-Meeting press conference is also Wednesday.

The Signature event of the week is Goldman Sach’s 39th Global Healthcare Conference, starting Tuesday, never mind it’s a sector so well covered with I-bank meetings, already, this year. The Goldman event is the book end to JPMorgan’s Jan. event, which kicked off the year. Last week, former FOMC chief Bernanke predicted stocks could fall 50%. This week, Janet Yellen is the headliner for Stifel’s Cross Sector Insights Conference, expected on Wednesday in what’s being referred to as a "fireside chat" with Stifel’s leader.

Economic Data ramps up also, with May CPI on Tuesday, PPI on Wednesday. Also Tuesday, the federal court is expected to release its opinion on the AT&T merger with Time Warner that the DoJ sought to block. A couple of observers found the judge to seem skeptical of the administration’s position in blocking the combination. But the judge might be trying to find a way to buck the administration without suffering a fuselage of tweets from the President who may still be in Singapore. On Thursday, the Dept of Justice Inspector General is supposed to release its report on the investigation into the DoJ & FBI’s investigation into Hillary Clinton’s use of a personal server for email—email she still denies ever contained classified information. Then, again, I don’t imagine Hillary expected that any of her emails would show up on the laptop of a man who can’t keep his hands off himself, who liked to email photos of the job he does on himself, to underage girls. Well, maybe not the first time he was slammed for doing so but certainly after that, donchya think? Is covered in the IG’s report should be the conduct of former FBI director James Comey who announced a new investigation into Hillary Clinton’s emails 11 days before the elections, in 2016, only to say never mind, 8 days later—too late for even some fans to vote for Hillary.

Trading on Monday, June 11th, could be a bit wild, given it’s the first day of trading after FTSE Russell published preliminary lists of changes to its indices to come at the end of the month. It’s also the first day of trades after Quadruple Witching—the expiration of options & futures on stocks & indices+commodities, respectively. The June 11th Deutsche Bank dbAccess Caterer’s Day & French Food Retail Investor Trip (Paris FR) sounds ridiculous until it’s connected to the Global Consumer Conference, also in Paris, starting the following day. I don’t know what Credit Suisse was thinking, naming its conference starting on Wednesday the US West Coast Yankee Bank Conference & Investor Day (San Francisco). There’s not a Yankee bank—or even a US bank—amongst those presenting, which are all European banks. At least Piper Jaffray’s Heartland Conference is all about presenting companies based in the heartland—and many of those healthcare, to boot!

If you missed it, last Thursday, the Feds & FDIC announced the schedule of releases of the mega-bank & mega-holding company Stress Tests & Comprehensive Capital Analysis & Review, otherwise known as CCAR. The Stress tests will be out after the close on June 21st. The CCAR is coming on the 28th, both at 4:30pm, right in time to influence the weekly options that expire the day after both of those Thursdays. But, then, we warned you last week to take into consideration the release of those items when buying any options expiring in June.

On June 12th E3 Expo opens the video game starring turn, producers like EA & Activision at levels never seen, only dreamed of back in the late 90’s. EA, alone, already sent out 6 press releases, touting its games to come, and the dates of release. And don’t forget, the White House has promised to unveil its list of $50B worth of Chinese products on which the US will slap new tariffs. That’s why the Earnings Calendar’s two solar power reports are not highlighted. They’re already under tariffs, and there’s probably more to come.

So, it promises to be one very busy week, Every mid-year index change creates stronger volume and more active trades in everything expiring at the end of the week but rarely does the Quad Witch arrive so early in the month, and rarely—if ever—with an FOMC meeting that promises a rate hike, a US leader in North Korea (that’s never happened before but Trump’s desire to win a Nobel prize knows no bounds). But add to that, the previous FOMC leader speaking on the same day the current one is holding a post-Meeting press conference, with the DoJ’s IG report to come, and a Federal Court deciding whether the US can go ahead and block the merger of a telco with a content company. Whew! Even just writing about it all is exhausting, and that’s before we have any idea what the latest dot-plots (SEP) will look like—whether 2 hikes look more likely after the 2nd hike of the year arrives on Wednesday. If the week were a mystery book gathering all the suspects for the big reveal, it couldn’t be any more suspenseful than the one ahead. Be careful out there! Wednesday could mark a near term top, trade the rest of the week to a downside the markets act like they don’t expect, after Wednesday’s hike. Then, again, the rally could gather another leg if the dot-plots still anticipate only 3 hikes this year, leaving only one after Wednesday’s near certain quarter point addition. And to think, we've got all this going on even as the ECB and BoJ meet this week, as well, with Dragh's press conference flowing into the US morning on Thursday.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar is here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence. 

June 04—08, 2018  Apple WWDC May Be the Event of the Week   It’ll be a week with few items to recommend it—a week before the one during which the FOMC meets. That makes it a tweener, where foreign data will catch up with what the US already released, last Friday, and Earnings Reports dominated by Consumer Names, many of them disasters in progress, along with a few Tech names that won’t make or break the markets. The Techs include Dell Technologies & Palo Alto Networks, on Monday, when Building Supplier Quanex also reports. Tuesday, Ambarella is the tech name, that stands out, along with HD Supply (formerly Home Depot Supply), Navistar & another building supply company, NCS. Wednesday, Brown Forman is the notable name, Jack Daniels’ maker but still as much a consumer name as Ascena Retail, Casey’s & Fred’s, on Monday. Thursday, Broadcom is the major tech reporting, Hovnavian the Builder du jours, but the world won’t end if any of them miss, Broadcom the only one that might shake confidence.

ASCO—the American Society of Clinical Oncologists got underway on Friday, and will finish up Tuesday. Any news out of ASCO is already publicly known, by this week, except for anything Bristol-Myers Squibb, Roche, or Merck might say when they meet with analysts @ASCO, Monday. BlackRock hosts an analyst meeting Tuesday.. I-banks are back in full swing, most of them hosting conferences, this week, even as the hotel & REIT analysts will all be at NAREIT’s Investor Relations Conference, on the 4th, similar to mass analysts meetings recently held by AGA & EPG. On the 5th through 7th, NAREIT hosts REITweek, less 1x1 than the IR day on the 4th. Also notable, DDW—Digestive Disease Week, along with Evercore ISI Autonomous Driving, AI & Mobility, similar to Needham & Co’s Automotive Tech Day, both Monday.

Even with Goldman Sach’s Lodging, Gaming, Restaurant & Leisure Conference, and the EEI Annual Convention +AGA Tech Advisory Cmte Meeting & CFO Meeting, plus BIO International, it’s really Apple’s WWDC (worldwide developers’ conference) that will captivate the media, which all bulls have to hope goes well, given it retains the biggest market cap in the world, and the biggest of all Tech Stocks, though some would dispute its inclusion in that category, given how much of its earnings come from the retail & wholesale sales of iPhones. Still, if you’re a bull, you have to hope analysts & developers are impressed with the software introduced at WWDC. There generally isn’t much discussion of hardware at WWDC, though there is more of that in some years than there used to be.

Beyond Apple, there’s ASM, Thursday, for Microbiology & Microbes, which is co-located with Interscience Conference on Antimicrobial Agents & Chemotherapy. In truth, IAAC has been absorbed into ASM, but some old-timers still look for the IAAC to be named. Also notable, Friday, is release of the Preliminary list of Russell Indices’ reconstitution, which will be updated on June 15th & 22nd. Lastly, Canadians are hosting G7--Growth that works for Everyone, one of the 5 topics of focus at the meeting, though it’s also been adopted as part of the title of the event. The others are preparing for Jobs of the Future; Working Together on climate change, oceans, and clean energy; Building a more peaceful & secure world; Advancing gender equality & women’s empowerment. Prime Minister Justin Trudeau presides over the meeting, at which US reps may well be shunned. And finally, after the "Hans Solo" disappointment, "Oceans 8" hits theaters with female cast members replacing the male crews that dominated 11 & its successors. Some theaters will show "Oceans 8" on Thursday some theaters are offering early peeks.

I give the bulls credit for not letting the markets fall apart, altogether. That suggests some underlying interest in staying long shares—despite the old maxim ‘Sell in May & Go Away.’ But I don’t think the bulls have had the last move, yet. In a typical year, crude would cool off starting now, until the first hurricane threatens the Gulf. Stocks would mark time or even pull back some more, before winding up for a last hurrah to the upside, after July earnings. Financials, though, may not have to wait that long, given the FOMC has said it would release results of the C CAR & Stress Tests, before June 30th. As I said last week, make sure to account for that release when buying any calls or puts that expire in June. The place to get short until late Oct won’t arrive until around August 5th. Then, again, we’ve never had anyone like Trump, who seems to relish in the possibility of starting a trade war. Canada already filed a complaint with the WTO against the US tariffs on steel & aluminum? Does Trudeau really think Trump will give a crap about what the WTO decides? And that’s the very independence that should scaring businesses in the US, and all the world over.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary is to be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

May 28th - June 1st, 2018  MUCH ADO ABOUT FRIDAY’S ECONOMIC RELEASES and Wednesday’s Beige Book    It would be my pleasure to take the week’s breakdown, below, and distill it into just a few items but that won’t be possible. First, my fingers are doing their own thing, not obeying my directions, at all. (C-6 & 7 crushed, impacting my arms & hands.) Then, I think I’ve already highlighted the biggies for Economic, Earnings & Event Releases, that you all are capable of distilling for yourselves. Take Canada’s Monetary Policy Committee Meeting Decision falling on the same day as the Fed releases its Beige Book. I wouldn’t expect Canada to take any action while NAFTA negotiations are ongoing. As for the Beige, there’s little reason to expect it to waffle any less than it always does. Nor do I expect companies to stop complaining that workers are hard to find. What they really mean when they say that is that other companies are paying more for workers, so we can no longer hire people and pay them squat and expect them to stay longer than 2 months.

While we’re on the Federal Reserve, the board announced its tentative 2019 meeting and press conference schedule. It includes 8 meetings and 4 press conferences after the March, June, September & December Meetings. Move along. Nothing to see here. Pundits had it wrong. As of now, they are not increasing the number of press conferences. https://www.federalreserve.gov/newsevents/pressreleases/monetary20180525a.htm

Speaking of the Federal Reserve, in announcing the scenarios for the 2018 CCAR (Capital Analysis & Reviews), and Stress Tests of the largest 18 banks operating in the US (Includes foreign ones), the Fed said results of its supervisory tests would be announced by June 30th. That means the Fed could announce it’s going to release the results at any time between Friday and the end of the month. I can’t speak for Jerome Powell or other current leads at FDIC but, historically, the Fed has had a habit of scheduling huge events like stress test results on the Thursday night prior to expiration. In that case, the results could be announced as soon as June 14th, June expiration one of the shortest, coming on the 15/16th. Then, again, the news could be released on June 21st or 22nd. In my book June 28th or 29th are less likely, because the major banks, by then, will be rushing to close their books, for the quarter, and don’t need any additional complications. In fact, that’s why June 14th/15th sound more reasonable, all around. The Fed’s announcement on stress tests & CCAR, with the "by June 30th" release date, here. Furthermore, the list of those banks & holding companies that must submit to the tests is included in that release. DB USA Corp is, presumably, Deutsche Bank which, at the rate it’s shrinking, may well escape the stress test mandate as soon as next year. Recall, last week it was rumored that as many as 10K US based employees could be subject to job cuts. At any rate, when you’re buying options--no matter which week in June they expire—you must build into the cost what may happen if the stress tests & CCAR results are released, or even, supposed to be released by that week’s end.

Then again, faster than it does some months, Friday’s June 1st data will include May Motor Vehicle Sales & the May Unemployment Report. Because the BLS makes "seasonal adjustments," there’s little reason to expect an onslaught of college graduates will make either the unemployment or participation rate look remarkably different from recent ones On the other hand, I know of at least one 34-year employee laid off from a construction company, and a teacher who’s decided to throw in the towel, due to untoward politicizing of her elementary school. And, while we’re at it, there’s probably nothing that will come from the G7 Pow-Wow in Whistler, late this week. "Investing in Growth that works for Everyone" is, simply, not on any legislative priorities.

The Earnings Calendar is extremely heavy with retail names and other consumer companies. JCPenney started closing 100 stores on May 27th, 2017. At the time, (soon to be ex-)CEO, Marvin Ellison, said activity in the stores slated for closure were going to remain open for a few weeks longer than originally planned, because the stores were so busy. Liquidation sales raised considerable revenues, that will make this quarter’s comparable store sales that much more difficult. I have not been a bull on Macy*s for a decade, and can’t stand the "John’s Bargain Store" look of its main floor, as shoes, handbags, and menswear host Backstage clearance sections, up to 80% off. Worse, traffic has picked up but so, too, has the amount of liquidation priced merchandise, much of it shopworn, missing buttons and belts, have pulls or runs, and half fallen hems, or suffering other indignities that make some of the inventory unappealing at almost any price. But, with Sears & JCPenney closing so many stores. Macy*s could well wind up the only lower end department store left for shoppers of a certain income level. In the short-term, Macy*s may well suffer uninspiring sales caused by the liquidation prices at JCP & SHLD, as they close stores but 2 or 3 years ago, SHLD and JCP may have so few stores that they’re no longer competition to Macy*s, at all, and out 7—10 years, may not be around, at all.

But, in addition to retailers, Booz Allen, Bank of Nova Scotia, Hewlett-Packard, Salesforce.com, Analog Devices, Ciena, Marvell Technology, Tech Data, and VMware will attract plenty of attention. Also worth noting are Microsoft’s InterOp DevDays in Asia, and Walmart’s Q&A with the Investment Community, as well as MSCI’s inclusion of Chinese A-Share listed companies in its emerging market index.

Likewise, there are few larger events than ASCO, and surely none that are more newsworthy, as a rule, for biotechs. It doesn’t open until Friday, so whatever hasn’t already been announced won’t be until the doors open. But that’s not all the Event Calendar offers; There are an insane number of I-bank events as the Street rushes in now that Earnings are largely done, and before the summer escape empties the caverns of lower Manhattan. Other than ASCO, Sanford C Bernstein’s Strategic Decisions CEO Conference is well respected though a mishmosh of sectors. Deutsche Bank’s Global Financial Services Conference (Tues.) should be full of positive news, as recent volatility is manna from heaven to trading facilitators. Cowen & Co’s 46th Annual Technology, Media & Telecom Conference is reliably newsworthy, as the calendar just entered the tail end of the quarter push.

Last week I was positive on FootLocker which worked out well. I don’t have a pick for this week, though. I base my preferences on the actual action I see in malls, and despite busy corridors, I’m not see as many shopping bags as I am people empty handed as my area (southern Florida) enters its 25th straight day of rain. American Eagle Outfitters? They’ve been closed, here, or rather, open in a temporary, new location outside, where one must get rained on to enter. Not a good move given all the rain we’ve had. It is rebuilding is usual spot, adding the leasehold next door, that used to American Apparel, probably to add more aerie and, possibly, kids. Adding kids is exactly what Abercrombir & Fitch has done, after closing the dedicated kids’ store, last year before back to school. Expanding the sizes available is probably a good way to curb piling up inventory of items that might not sell, while reducing the rent expense ANF suffered when it maintained 2 separate stores, one for kids, one for adults. Target, in what’s got to be record time, opened a dedicated "pick-up" are close to its entrance, for shoppers who either call in or order online, and want to be quick about picking up the order already paid for. Six spaces were cordoned off one Monday, and three weeks later the spots were market with large signs. Whether shoppers are respecting those "PICK—UP ONLY" signs or not is anyone’s guess. My 91 year old mother feels entitled to use the maternity parking spots near Talbot’s, where are too few handicap spaces. Is anyone going to argue with her? Probably not."

If there are any other events worth concentrating on, they’re probably those concentrating on sectors less traveled, like RayJay’s Defense & Government IT (Wed.). Is there anything that’s going to come out of Book Expo America, in NY (starting Wed.)? The only valuable intel I could scrounge up is that most of the author readings & signings will take place on June 1st. BEA has one of the most annoying websites I’ve ever encountered, that revs up the same video before disclosing any information, slowing down a researcher like me to maddening distraction—enough to elicit an email to the producer.

With that our digits are done. It’s just too painful to keep typing except to say that Trump knows he needs to actually meet with Kim Jung-on of North Korea to be in contention for a Nobel Prize for Peace, so expect him to push for that meeting to take place, no matter how little is likely to get done.

ECONOMIC:  (Highlights, only, below. Full International Economic Calendar here.)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, along, and should be just one factor in more complete due diligence.  

May 21—25, 2018  EVEN MORE CENTRAL BANKERS & RETAILERS GALORE   After a light week for debt issuance, last week, the US Treasury cranks it up this week, offering $231B in debt. Most worrisome is the $30B 7-year Notes being offered Thursday, the $36B 5-year notes perhaps needing a higher rate to attract sufficient buyers. How smart is it for the Treasury to offer $33B of 2-years Notes, on Tuesday, then, $16B of reopened 2-year Floating Rate Notes on Wed.? With the next rate hike all but promised for the June 12—13th Meeting, it doesn’t take a genius to expect FRN’s to do better than fixed rate debt of the same duration—even if that duration is short by central bank terms..

The FINRA Annual Meeting speakers list is filled with many lawyers and brokerage house members, along with the SEC’s Chairman Jay Clayton. Keynote from Robert Cook, Chair/CEO of FINRA, Wells Fargo Advisors represented by Ron Long, is an ironic panelist on "Working Together to Protect Senior Investors." I say ironic because I know, first hand, through my mom, that Wells employees thought nothing of opening unwanted accounts for seniors, that charged them monthly fees, even when the accounts held jumbo funds, and the money was transferred out from accounts that charged no such fee. There’s a bootcamp on Advertising Compliance, while WFC offers a panelist for "Emerging FinTech Trends." IMO Wells needs to do a better job of running the bank it has before getting into FinTech.

Take a look at Monday’s FedHead speakers: Bostic on Welfare Economics, Harker at the Chief Executives Organization CEO Financial Seminar 2018—Visionary Investment: Managing late cycle Risk & Opportunities. Tuesday, SEC chairman Jay Clayton keynotes at the FINRA Annual. FOMC May 1st—2nd Meeting Minutes are out Wednesday, along with April New Home Sales & Neel Kashkari At Next Energy Williston Basin Petroleum Conference in Bismarck, ND. In addition, Wednesday, the Treasury will ber auctioning 5-year Notes in addition to the aforementioned 2-year FRN, while overnight, NY Fed’s soon to be leaving President Wm Dudley, is a panelist at BoE’s Markets Forum 2018, the topic: "Reference Rate Reform" Improving the Culture of FICC Markets," a topic we’re pretty sure he won’t be asking his former firm about, since Goldman Sach’s FICC has badly lagged every other firm’s. Thursday, Fed’s Kaplan, Bostic & Harper are co-panelists on a "Policymaker" panel at the Dallas Fed TED: Technology Enabled Disruptgion: Implications for Businss, Labor Markets & Monetary Policy (Dallas thru 25th) And if that weren’t enough for Thursday, Harker will participate at a later Q&A at TED, at 2pm et. Meanwhile, Thursday also promises FHFA March & Q1 House Price Index (9am), & NAR April Existing Home Sales (10am). At 1pm the Treasury will try and auction off $30B in 7-year Notes, which worries me. Longer tenors have not gone well, of late.

Friday is expected to be challenging for Facebook, Google, Microsoft, and Verizon’s Yahoo & AOL due to EU’s GDPR—General Data Protection Regulation, effective on the 25th, which includes the "Right to Be Forgotten." Before the day is over, Fed Chief Powell will be a panelist with Boe’s Carney & Riksbank’s Liikanen at "Financial Stability & Central Bank Transparency," at Sveriges Riksbank Anniversary Conference: 350 Years of Central Banking—The Past, Present & the Future (Stockholm 9:20am et) Before the day is over, Fed’s Evans, Bostic & Kaplan will be co-policymaker panelists, again, at the Dallas Fed TED event that Kaplan will, also, close. But Friday could be a lost cause: It’s not T-3 for End of Month, and Treasuries, along with other SIFMA controlled markets close at 2pm. Equities, only, will remain open, because the NYSE doesn’t like to close no matter what Bonds do.

Which brings us to Earnings, Consumer Discretionary names dominant, from Auto Parts Stores Advance Auto Parts to AutoZone, plus discounters TJMaxx (Tues), Ross Stores +Target (Thurs), but also some tech firms like Hewlett-Packard Enterprise, Intuit (Tues), NetApp & Synopsys (Wed.), and Autodesk (Thurs), plus builder Toll Bros (Tues), apparel manufacturer & retailer Ralph Lauren, plus Tiffany & Williams-Sonoma, Canadian Banks RBC & TD, plus Spam (forever food) maker Hormel, McKesson & Medtronic. And if malls have improved, which they lately seem to have done, than the Street is too negative on Footlocker, reporting Friday.

Sunday, The Nat’l Restaurant Ass’n Meeting continues, as does ATS, AUA, the Int’l Trademark Ass’n Annual, along with Infusion Therapy. Starting Sunday, the ICSC (Int’l Council of Shopping Centers) REcon, a Global Retail Real Estate event, REITs that own Retail Real Estate out of favor has more store closures get announced monthly. Beyond REcon, AGA is the American Gas Association’s Financial Forum, a mass analyst meeting that, rightfully, attracts all the analysts that cover the group. Ditto, EPG is Electrical Products Group, holding its Spring Annual Meeting, like AGA, a mass analyst meeting at which companies like 3M, GE, & Honeywell will host analysts meetings in Longboat Key FL. Barron’s and other publications have talked up UBS Global Healthcare Conference in NY but that’s a subject overplayed since JPMorgan kicked off the year with its own Health Care Conference in January. The only thing one can say about biotechs & pharmaceutical companies is that there’s zero optimism in them, despite Trump offering little in the way of restraining their pricing on drugs, when he unveiled his plans. FDA Chief Gottlieb wants to do more to more generics along but he can’t really do any more than the Congress has allowed. So, yeah, drug makers may bounce this week but I wouldn’t bet the farm in that direction. In fact, I’d be putting the rest of the year under serious scrutiny by listening to some of the presentations at AGA & EPG. Raymond James is stepping out of the box to host meetings at the Wireless Infrastructure Show, which this year is taking the name "Connectivity Expo) in Charlotte NC. The Medicaid Managed Care Congress is in Baltimore.I even like the Licensing Expo (starts 22nd) better than many of the I-Bank Conferences, this week. This is where real TV, Toy, Apparel & Other Merchandising properties gets seen and licensed.

I do prefer UBS’ Global Oil & Gas Conference to its Healthcare one, and like that Argus has scheduled its North American Natural Gas Conference, and the New Texas Swing DUG Permian Basin Conference, not any of them in the same city in Texas. To top it off, Daiwa is hosting a Texas (Energy) Research Tour in Texas, thru the 25th. And we just looked at Sunday and Monday. Tuesday, Gas Shipping Americas takes place in Houston, one of several shows OPEC lists on its calendar. JPMorgan heads to London for its 45th Annual TMT CEO Conference, where Morgan Stanley will land, too, for ChemTech Day. Don’t overlook SEMICON Southeast Asia, in Kuala Lumpur, either. Or ConFab which started Sunday, since Semi’s have been sizzling places to invest, until last week’s report from Applied Materials. All could be on its way to recovery, if Micron Technology makes the right noises, Monday, when it hosts its analyst meeting. Int’l Display Week, starting Tuesday on the West Coast could also give a boost to LED semiconductor companies—CREE a name that’s held its own after its last 2 earnings reports.

For fun, Memorial Day weekend, there’s a host of Disney movies available. Think "Black Panther," "Avengers: Infinity war," & opening Thursday, "SOLO: A Star Wars Story," a prequel of sorts, which introduces Chewbacca, and his role as the co-pilot. For women, there’s Book Club, with women of a certain age who are stlll attractive & sexy to men of the same or more age. While Stocks could rise on low volume into week’s end, it won’t be anything to get too excited about, unless the news out of AGA & EPG are a lot better than either GE or 3M gave anyone to expect.

Drive safely! Enjoy the long Weekend next weekend. We will update the Economic Calendar but an Outlook is debatable.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

May 14—18, 2018  RETAILERS & I-BANK CONFERENCES DOMINATE, with a side of Central Bankers    The Consumer Discretionary space will dominate Earnings, this week, with reports from Macy*s, Nordstrom & Walmart, to name the 3 most notable names. WMT, of course, is not about current earnings for the moment but, rather, about the billions it’s spending for a majority stake in India’s Flipkart, the fact that it’s giving up on the UK, selling ASDA to J Sainsbury, jumping from one boiling pot to another, when it hasn’t really done a fantastic domestically, yet. But, also, we’ve gotten ahead of the way we lay out the weekly Outlook Calendars, so let’s circle back to the Economic Calendar, and take them in order.

The US Treasury won’t be offering a lot of debt, this week, just 4-week, 3-, & 6-month Bills, Monday, and $11B of reopened 10-year TIPS, on Thursday. Also Thursday, the Treasury will announce its refunding plans, even as it just announced the April budget surplus was at a record $214B. That would be thanks to Corporate fiscal taxes due March 15, and personal income taxes due April 15. Stocks often struggle less when Treasury auctions don’t disappoint. There’s nothing on offer this week capable of disappointing, short of a complete strike against US Debt.

Also this week, April Retail Sales & NAHB’s May Housing Market Index, both Tuesday. Wednesday promises April Housing Starts & Building Permits, April Industrial Production/Capacity Utilization, the latter likely strong, given shale oil drilling and a freak spring snow storm that kept utilities in overdrive to warm homes & businesses. Before markets open Monday, Fed’s Mester will speak in France, those from BoE Governor Carney & ECB’s Praet probably not earth-shattering, since their topic is Gender & Career Progression. More trembling is the opening of the new US Embassy in Jeruselum, which has enraged just about everyone but Trump and his family members, along with Israel’s government. The people of Israel may celebrate the move publicly but privately they bemoan that Arab hatred for both Israel and US are at near all time highs.

Fed’s Bullard presents at CoinDesk’s Consensus 2018, in NY, Monday, part of BlockChain Week New York. The Senate Banking Committee will hold hearings on the nominations of Richard Clarida & Michelle Bowman to the Federal Reserve’s Board of Governors. Neither should encounter big issues getting confirmed. Fed’s Williams, soon to move from the San Francisco Federal Reserve Bank to New York’s more prestigious one, conferring on him a permanent vote at FOMC meetings, will speak at the Economic Club of Minnesota, Thuesday. Fed’s Bostic will provide an Economic Update Wednesday, the same day Bullard opens the Homer Jones Memorial Lecture, not quite the venue for monetary policy proclamations. Thursday, Fed’s Kaplan & Kashkari are at separate events, Kashkari, a well-entrenched dove on rates, answering questions put to him by the Executive Director of the Minnesota Home Ownership Center. Many hours later, in Frankfurt, Mester, a hawk, will keynote the 2nd day of the 3rd ECB Macroprudential Policy & Research Conference, on "The Limits & Overlaps of Macroprudential & Monetary Policy." Mester is hawkish enough that she’d find a way to discuss her objection to the FOMC raising rates so slowly, no matter what the topic. The topic of this conference works, perfectly, to her leanings. Still, she probably would have been more comfortable speaking at the BoE/ESCoE/ONS Conference on Economic Measurement, which questions the value of statistics and their interpretation.

Which brings us to Earnings. In addition to the 3 names mentioned above, Dick’s Sporting Goods, Home Depot, VIPshop Holdings, Take-Two Interactive, Tencent, Children’s Place, and JCPenney, stand out. But the week isn’t, exclusively, the province of retailers or restaurants. Other notable reporters include Agilent, Invitation Homes, Applied Materials, Canadian Solar, Cisco Systems, and Deere. Deere, known more for agricultural machines than Caterpillar, and on a six month slide since the year began, seemed to rally on CAT’s strong earnings, last week but left room for additional gains if it reports a strong quarter and sees one ahead. Canadian Solar was a name I wouldn’t usually mention but California’s new law requiring builders to install solar panels on almost all new homes, starting in 2020, has opened my and other traders’ eyes to the Canadian solar name, given the hefty tariffs on Chinese solar panels. As always, filtering out the tickers to mention is very subjective. Feel free to disagree.

Last, the Events Calendar bucks up just as retailers begin dominating the Earnings Calendar. I try to sort the events by geographic region, first, then by what I think will be most influential on stocks. So US events, trump Canadian ones, and are listed prior to European ones, with Asia and Australia usually last. Within those parameters, I afford the most weight to the investment houses with the most influence, and sometimes place related events near the main one, to emphasize how many ancillary meetings spring up to capitalize on a particular event. For Monday and Tuesday especially, this week, I did the best I could. Rarely are days so filled with I-bank run conferences that they’re dizzying but that’s where I was this week. I’m partial to events that don’t follow a long string of similar ones, so JPMorgan’s 11th Annual Homebuilding & Building Products Conference, in NY, took the top spot Monday. With interest rates rising, even as home prices are rising strongly, and the calendar is at the height of the builders’ season, it struck me as an event that portfolio managers (PMs) will be eager to attend. But, really, any of the first 5 events that appear for Monday list could have been on top. And no fewer than 3 I-banks are hosting China Conferences, this week. And sometimes I have to scratch my head: while Tudor Pickering Holt’s Hotter ‘n Hell Energy Conference starts Tuesday, Citi’s hosting Energy & Utilities in Boston, Stephens is hosting energy in Little Rock Arkansas, and Deutsche Bank is hosting Clean Tech, Utilities & Power in NY. And while JPM is the top dog for this week’s homebuilding sector, Jefferies offers Residential Real Estate Housing Summit, also in NY, even as Morgan Stanley will host E&P & Oil Services in Houston. Instinet’s Gaming, Leisure, & Lodging Conference, Monday, has competition from Wells Fargo’s 9th Annual Gaming, Hospitality & Leisure Conference is nearly identical. Believe me, I don’t mean to sound like I’m criticizing any of the I-banks. Instead, I’m merely pointing out how I decide the hierarchy, and the schedule that results with so many similar conferences occurring bunched together, because all the I-banks observe a quiet period around the three weeks during which the most S&P companies report their earnings, and most suspend conferences during the summer, when many PMs are either at their summer homes or otherwise engaged with other activities.

Last week I discussed the potential for a post-earnings season rally that usually starts this week. Traders jumped the gun and fanned the flames burning in bulls’ hearts, reversing a long slide with a big rally. While I’m not expecting a rally similar to last week’s to occur this week, I do think that a period of backing and filling will be followed by more gains, before the pre-Q2 earnings season jitters grip stocks.

ECONOMIC: (Highlights only, below. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.   

May 07—11, 2018   EARNINGS TAKE BACK SEAT TO CENTRAL BANKERS plus Welcome Back I-Bank Conferences  The tide has shifted again, and though Wednesday is flooded with Earnings Reports, it’s really the central bankers on the Economic Calendar worth attention. In fact, I suspect the Richmond Fed’s Thomas Barkin may be set for his coming out party, Monday, when he’s scheduled to speak at George Mason University. If he’s spoken before it escaped my notice. He was installed on January 1st of this year. Given all the Fedheads speaking at the Federal Reserve Bank of Atlanta’s Machines Learning Finance Conference, it’s a bit surprising that he wasn’t on the schedule. But it’s not just the Federal Reserve Banks that are offering up speakers, the BoJ is set to release its March Meeting Minutes, before the US Markets open on Monday, the New Zealand central bank is holding a Monetary Policy Meeting, the MPC decision due out Wednesday, overnight, while the BoJ will also release its summary of Opinions from its April 26—27 Meeting the same night, while the BoE will hold a Monetary Policy Meeting, and release the results overnight Wednesday, also.

Outside the central bankers, there’s FTSE Russell Indexes’ Reconstitution Rank on Friday, with 2 more updates in June, before the reconstituted indexes make their debut after the close, on June 22nd.And it that wasn’t enough, there’s the Treasury intending to auction 30-year Bonds on Thursday, the 10-years meeting some resistance, so 30 could be a disaster—you never know. A softish April Employment Report last Friday has some thinking that, perhaps, Caterpillar’s CFO had it right—the high water mark was 18Q1.

I did my best to highlight the scheduled Earnings Releases I suspect will attract the most attention but it’s not always for their earnings, specifically. Taken Tyson, Monday. Are the Chinese pulling back from buying the chicken feet because of US Tariffs? Then, what are the odds that 3 big brewers would report on Wednesday? Who, you wonder? AmBev S.A., Anheuser-Busch, and Craft Brewing. All we’d need is Constellation Brands, which has already reported, and Sam Adams, and the entire industry would be reporting Wednesday. Likewise, there are a number of solar-related names reporting this week, and more than a few entertainment companies. Then, again, it should be interesting to hear how IAC’s chairman, Barry Diller, also chairman of Match Group, both reporting on Wednesday, downplay the risk of FaceBook’s entry into dating. Then, Thursday, Kelly Services is reporting, the company usually an early warning sign of economies slowing down, since the first thing they do is freeze hiring, before they even get to laying off some workers.

And it can’t be a coincidence that a Timeshare merger was announced, last week, just as ARDA World & Global Time Shares start their meeting in Las Vegas, today, Sunday, as I write. I-banks are back in the conference mix, though many of them are venturing to the Orient for their meetings and, in some cases, Tours, which both JPMorgan & Citibank plan, even as Macquarie plans a Greater China Conference on Thursday, even as UBS hosts China A-Shares in New York, Monday. Macquarie’s Business Services C-Suite Conference, in Boston, starting Thursday, sounds like a fresher topic—certainly less trod ground than Healthcare, which happens to be the biggest I-bank event of the week. It’s also the oldest, Deutsche Bank’s 43rd Annual Health Care Conference, starting Tuesday, in Boston. But then, Citi is hosting Consumer Staples on Monday, and Goldman is doing the same on Tuesday. Then, again, on Tuesday, both Wells Fargo & Oppenheimer are hosting Industrials, in NY.

All in, it will be a busy week, the hundred some odd companies reporting earnings a bit of a sideshow to the main events. Those start with Central Bankers yapping on both sides of the Atlantic, then move to I-bank conferences. But there is something to be said for this week’s earnings, they usually end a period of 3—4 weeks of market indigestion that typically accompanies both the earnings season and income tax season. By the week after this one, the bulls might be able to flex some muscle, as the Street decides the best earnings season in years thanks to a tax cut ushered in some optimism for the 3 quarters ahead. It wasn’t all bad.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.  

April 30—May 04, 2018    2nd DELUGE of EARNINGS + CENTRAL BANKERS   After last week’s $229B of issuance, the US Treasury provides a light week, with 4-week Bills, amount not yet announced, and both 3- & 6-month Bills Monday, and that’s it. Of course, the FOMC meets this week, post-Meeting Statement on Wednesday, at 2pm but virtually the entire FOMC will be speaking this week, albeit, not until the end of the week. The happy rate hikers speaking at the Hoover Institution (Stanford University), Friday and Saturday, before Gov Quarles does double duty next Sunday, at the 23rd Annual Financial Markets Conference on "Machines Learning Finance," a somewhat unexpected topic for the Federal Reserve’s Banking Supervision governor.

It’s not just US central bankers speaking. Tuesday’s Bk of Canada’s Poloz speaks, Wednesday, in addition to the FOMC statement, the Norges Bank (Norway) monetary policy committee meets on rates, while the ECB’s Constancio & Coeure speak on "Fostering Banking Union & Capital Markets," and the Bk of France’s Galhau speaks, at the Bank of France/European Investment Bank jointly host a conference on Investment in France: Gearing up for momentum, in Paris, while, by Thursday, the St Louis Federal Reserve s hosting its Advances in Research Conference, with a surprising lack of FOMC leaders in attendance. But feat not, the Swiss National Bank’s Gov Jordan will be speaking, on the Vollgeld Initiative—a movement that wants to see every penny lent by financial institutions backed by cash or gold. (No, I didn’t see Rand Paul or his father on their Agenda). Then, Friday, the Hoover Institution hosts a smorgasbord of FOMC members for its "Currencies, Capital & Central Bank Balances: A Policy Conference." Fed Gov Quarles & San Francisco (soon to be NY Fed) Pres Williams present on "Financial Stability, Regulations & the Balance Sheet." Before the day is out, the Fed’s Bostic, George & Kaplan will, also speak. And even so, the highlight of the week may well be next Saturday’s Yahoo stream of Warren Buffett & Charlie Munger’s Q&A with shareholders at the Berkshire Hathaway Annual Meeting, a weekend event known, also, as Woodstock for Capitalists.

Which brings us to Earnings, this week’s volume of reports only slightly smaller than last week’s. And though it may feel like every important company has reported, already, let me point out a few you might be overlooking: Monday, Akamai, Allergan, McDonald’s, & Vornado Realty Trust, to name just 4 out of a larger group highlighted. Tuesday, Aetna, Allstate, American Tower, Anadarko Petroleum, Apple, ADM, AutoNation, BP, Eaton, Gilead, HCA Healthcare, Kindred Health, Merck, Mondelez, Pfizer, Sabre, Scotts-Miracle-Gro, Seagate Technology, Tapestry (formerly Coach), Under Armour, Wellcare Group, & Yum China are just a few of the names highlighted.

Wednesday, reports are scheduled from AIG, AmerisourceBergen Brunswick, Apache, Automatic Data Processing, Avis Car Rental, Beazer Homes, CDW, Cerner Corp, CF Corp, Clorox, CVS Caremark, DinEquity, Energizer, Equinix, Estee Lauder, Express Scripts, FireEye, Host Hotels & Resorts, Humana, Hyatt Hotels, Kraft Heinz, Madison Square Garden, MasterCard, MetLife, Molson Coors Brewing, Murphy Oil, Norwegian Cruise Lines (2 days before its analyst meeting), Novo Nordisk, NXP Semiconductor, Prudential Financial, Republic Services, Scientific Games, newly public Spotify, Square, Tableau Software, Taylor Morrison Homes, Tesla, Wayfair, Wyndham Hotels, YUM! Brands, and Zoetis. I won’t even try and pull out just a few names for Thursday, given how many significant reports have been highlighted, already. Skim the last two days of the week yourself, and then look deeper into the daily lists, if you wish. It’s simply another ridiculous week for earnings, no ifs and or buts about it. Why does the entire public vacation-ownership segment seem to be scheduled to report on Thursday? Beats me but most are somewhat recently spun out of their original, hotel parent. And Alibaba stands out for me, Friday, just as Berkshire Hathaway’s Annual Meeting does for others, Saturday, competition for the Kentucky Derby, the Triple Crown’s opening leg. For the record, my naming some of these companies I’m not endorsing them or, sometimes, not even interested in them but either the Street, traders or the media must be, for me to embolden them.

Which brings us to Events, where the number of I-bank meetings remain slight, because the Earnings calendar is so heavy. Which makes it ironic that so many oil companies are scheduled to report, even as Offshore Technology starts Monday, Credit Suisse an exception, hosting a concurrent meeting & tour. The Interactive Ad Bureau’s week-long schedule of NewFronts, this week, starts on Monday, with FaceBook, New York Times, and Viacom. A day later, FaceBook’s F8 Developer Conference could shine the brightest, Tuesday, as developers surely await the changes they should expect after the Cambridge Analytica disaster. NewFronts, fo those who vaguely recall the term are the digital equivalents to the major networks’ UpFronts—it’s when companies try and pre-sell ad space on their digital (internet) websites.

All in, it will be another insane week, the spotlight, thanks to NewFronts, still on the internet companies that have already reported, even as the rest of the big names are scheduled for this week, BABA included. Plus, the schedule promises a surfeit of energy names, hotels, hospitals, insurers, and large biotechs, plus cult names like Tesla, who Whitney Tilson may well mention during his "Art, Pain & Opportunity of Short Selling " presentation, Thursday, an event CNBC will definitely cover, since it’s the sponsor. And much as this week will, for some, be all about waiting to hear the Q&A from Buffett & Munger next Saturday, for most of the Street, the biggie will be this Friday’s Unemployment Report. (You know I’m waiting to see the final revisions to February, the shortest month of the year which has, so far, delivered the largest number of jobs added in years—over 300K.) The FOMC meeting statement, Wednesday, will be Jerome Powell’s 2nd, so his emphasis is still evolving in the Street’s eyes. The Minutes for his first meeting as chief was filled with uncertainty, especially about what the tax cuts & budget passed means for the economic outlook. For all the central bankers speaking this week, Powell is not among them. That seems odd, unless he’s trying to develop his voice in private, before taking his place more prominently, at some of the events his underlings are populating. And that’s odd, given that his first duty as FOMC Chief was the semi-annual testimony before Congress, in February. You can’t make your grand entrance twice!.

Historically, this is the last week of earning-related hesitation before a post-earnings relief rally, celebrating getting through earning season without getting bludgeoned to death by huge misses. No need to jump the gun before later in the week, unless you have a particularly strong opinion about where the Unemployment Report will come out. .

(Highlights, only, below. Full International Economic Calendar here

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be only one factor in more complete due diligence.  

April 23—27, 2018  EARNINGS SLAM    IMF and orld Bank Group Meetings? Who cares? G7 & G20 meetings on the sidelines? No one cares. A slug of US Housing Data? Unlikely to change the trajectory of interest rates, the Treasury making up for lost time, this week, by auctioning off $229B of debt, the 5 & 7-year Debt not going as smoothly as some might hope, of late, higher rates not a cure-all and starting to ding stocks. .

This week’s Sohn Conference might make things worse, since its value investing speakers are likely to point out a lack of value available in stocks at current levels. Also this week, March Durable Goods Orders & Shipments, and the first crack at Q1 GDP. One facet of GDP is the Personal Consumption Expenditures—PCE, upon which the FOMC bases its inflation snapshot. Of course, the first estimate of GDP isn’t often close to the final, 3 months later but the initial guess is often the one that attracts the biggest reaction. The Blue Chip Consensus ranges around 2.5% but the Atlanta Fed shows GDP far from the 3.0—4.0% Trump and his team promised. In fact, there’s a chance GDP will barely make it to 2.0%, at least in the first pass. The Feb GDP estimate of nearly 5.0% a mystery to one and all. Then, again, harsh snowstorms, right into April, must cut into productivity, just as Sunday’s southern deluge of rain kept everyone inside.

There are, also, central bank rate decisions expected from Sweden’s Riksbank, the ECB, and the BoJ. Mario Draghi has promised that European rates would go nowhere until, at least, past September, though some are betting the ECB will withdraw some of its stimulus before the year ends.

The week will be flooded by the sheer number of companies scheduled to report earnings this week. It can only be considered a slam. Sheer volume, as well as some of the biggest FANGs will influence what tech does this week and, possibly, beyond, as Alphabet (Google) (Monday), Amazon (Thursday), Facebook (Wednesday), and Microsoft (Thursday) report, as do Comcast (Wednesday), Charter Communications (Friday),, & Time Warner (Thursday), not to mention Royal Dutch Shell (Thursday), and on Friday, both Chevron, & ExxonMobil. But that doesn’t even scratch the surface of the number of companies scheduled to report, which should make this THE week for earnings. The volume will drown out almost everything else but equity investors should not overlook what’s happening with interest rates because rates are starting to reach damaging levels, that will make everything from cars to mortgages more expensive. Higher rates have the power to lower company earnings, and lower consumption. While credit card companies haven’t yet raised their rates on the best customers, that can only be around the corner, crimping consumption even more.

Surviving the week won’t be easy but if you do, perhaps you’ll end the week at the movies, seeing Disney’s "Avengers: Infinity War," which it turns out, is debuting before Black Panther has finished its run in theaters.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the authors, alone, and should be just one factor in more complete due diligence. 

April 15—20, 2018  FOMC RARELY AS UNCERTAIN AS IT SOUNDS NOW     The following 3 paragraphs excerpted from the much longer FOMC Minutes of March 20th—21st Meeting stood out for me. First, they don’t know how tariffs, retaliation, or tax cuts will impact the economy, yet, they didn’t shy from raising rates at the meeting, or forecasting more rate hikes to come. So whether Street economists see 3 or 4 more rate hikes coming, they know no more or less than the members of the FOMC, who aren’t really sure how anything will pan out.

Participants did not see the steel and aluminum tariffs, by themselves, as likely to have a significant effect on the national economic outlook, but a strong majority of participants viewed the prospect of retaliatory trade actions by other countries, as well as other issues and uncertainties associated with trade policies, as downside risks for the U.S. economy. Contacts in the agricultural sector reported feeling particularly vulnerable to retaliation.

Tax changes enacted late last year and the recent federal budget agreement, taken together, were expected to provide a significant boost to output over the next few years. However, participants generally regarded the magnitude and timing of the economic effects of the fiscal policy changes as uncertain, partly because there have been few historical examples of expansionary fiscal policy being implemented when the economy was operating at a high level of resource utilization.

Participants agreed that the longer-run normal federal funds rate was likely lower than in the past, in part because of secular forces that had put downward pressure on real interest rates. Several participants expressed the judgment that it would likely become appropriate at some point for the Committee to set the federal funds rate above its longer-run normal value for a time. Some participants suggested that, at some point, it might become necessary to revise statement language to acknowledge that, in pursuit of the Committee's statutory mandate and consistent with the median of participants' policy rate projections in the SEP, monetary policy eventually would likely gradually move from an accommodative stance to being a neutral or restraining factor for economic activity.

The Economic schedule is filled with FOMC speakers, as well as central bankers from other countries, given the joint Spring meetings of the World Bank Group & IMF. That Joint Meeting is always accompanied by meetings of other groups timed to take advantage of the central bankers from around the world who intend to participate in the schedule. In truth, both the World Bank & IMF host their own, individual, spring meetings starting the 17th, then join for the Joint meetings on the 19th—22nd.

Speaking of meetings, future meetings of the House of Representatives will look drastically different, a year from now. Republican members are planning to retire in record numbers, the Speaker of the House, as well. So I wondered how much a representative makes for living away from home, for months at a time, aside from the perks like staff salary allowances, and housing allowances. What’s it worth in pensions to have put up with all the muck and dirt slung at the House. Paul Ryan’s pending retirement income is quite modest, after 20 years, and explains why a former House or Senate member would set out on the speaker circuit, and write a book.

At 48, Paul Ryan can claim his pension in 2 years, collecting a Federal Employees’ Retirement System pension of nearly $85K p/annum, $76K of which is for his 20 years of service as Congressman, another $6,493 for toiling as a staffer in Congress. FERS contributions have been mandatory since 1984. When he’s older, Ryan will be able to collect Social Security, as well, plus whatever he’s put away in the Congressional equivalent of a 401(K) plan, a Thrift Savings Plan. Of course, Ryan will make real money once his one-year "cooling off" period ends, that period the Congressional equivalent of a non-compete. Afterwards, he can make 6-figures as a lobbyist, consultant, or any other job he may be offered. Evidently, Congress anticipated the pot at the end of the rainbow, as speakers, boards of directors, and other more lucrative possibilities, when setting such a small pension for members. How else to justify explain such a puny pension after 20 years of flying back & forth to Wisconsin, and 3 years as the leader of the US House?

The Economic Calendar also includes the typical monthly releases; Housing data Monday & Tuesday, as well as March Retail Sales Monday, which analysts expect to reverse weakness in Jan & Feb, tax-refund related delays to some spending. Canada’s monetary policy committee meets Wednesday, the country’s data expected to be released throughout the week, Friday March CPI & Feb Retail Sales. Most interesting, perhaps, Fed Gov Quarles testimony in Congress, Tuesday and Thursday, the first appointed point person on banking supervision and regulation in years—a position that never got filled under Obama.

The biggest week of earnings, so far, starts Monday, with Bank of America, Netflix, & Charles Schwab 3 highlights. In the past, Bank Earnings usually lifted markets that were, shortly thereafter, brought down by successive reports from the rest of industry. This time, banks reported strong earnings, last week, none of which seemed to please the street—not even when accompanied by strong outlooks.

Tuesday could prove another important day for earnings, with Goldman Sachs, CSX Railroad, Interactive Brokers, IBM, Johnson & Johnson, Kinder Morgan, Lam Research, Omnicon, United Airlines, and UnitedHealth set to report. Wednesday, note American Express, Morgan Stanley, Robert Half Associates, Steel Dynamics, Textron, & US Bank Corp.

On Thursday, note Alliance Data, Bk of NY Mellon, Blackstone, Keybanc, Philip Morris, PPG, Quest Diagnostics, & Taiwan Semiconductor, leading into Friday: Baker-Hughes a GE Company, GE, Honeywell, Kansas City Southern (Rail), Manpower, Procter & Gamble, Regions Financial, Schlumberger, Stanley Works, State Street, SunTrust, & Waste Management, a hefty cross section of every sector but Utilities & REITs, which are yet to come. The week, in short, will clear out the last of the most important financials to report, ex-insurers.

Former FBI director James Comey interview debuts Sunday, at 10pm on 20/20, with George Stephanopoulos lobbing the questions. Tuesday his book, "A Higher Loyalty" launches, and I sure hope it’s better than Wolfe’s "Fire & Fury," because that’s a terrible book, very poorly written.

What about Industry & I-bank Events? The schedule dries up during the heart of earnings season, and especially when the IMF & World Bank are set to take center stage. The biggest conference, AACR, the American Association of Cancer Research Annual Meeting is usually a highlight of the spring. It was surprising that analysts weren’t stepping out more, last week, bulling the biotechs & pharma companies scheduled to have research unveiled. Amgen sent a press release about studies to be revealed at AACR, while Gilead did the same on NASH, at HIV & Co-Infections in Whistler, the Liver Meeting in Paris France, and the British Society of Haematology in the UK. Also notable this week, the International Home Furnishings Market, in High Point. Cruise Lines should be in focus as Cruise3Sixty gets underway in Ft Lauderdale. Norwegian is the latest to provide a horrible experience to passengers, renovating a vessel were people were on a $10K cruise. Then, there are people who keep falling off cruise ships, usually because they were drunk as skunks, and trips where rape committed by cruise employees are hush-hushed. If you want to subject yourself to lawlessness, a cruise is an easy way to accomplish that, the noro and roto viruses often the least of passenger worries.

The Denver Gold Group is hosting the European Gold Forum in Zurich, just as gold is finding some favor. Bigger still, Business Aviation Asia, in Shanghai—which I’m typing just as "60 Minutes" is finishing its hack of AllegiantAir. Watch the Farm Equipment Manufacturers Supply Chain Summit, given Trump is working on offsets to tariffs & repercussions, which should be a highlight. HIDA, the healthcare distributors e-Commerce Conference strikes me as a rebuttal to the possibility that Amazon could enter the field, even though there’s never, before, been an eCommerce event for the healthcare distributors. Then, again, I can’t remember a world congress on Osteoporosis, Osteoarthritis & Musculoskeletal Diseases in Poland, before. Or, you could just sneak away to Indio California, and let loose at Coachella.

Meantime, if you’re still long, be looking for levels to get out. The Trump honeymoon is dead, and even a great earnings season won’t be sufficient to drive stocks up.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

April 09—13, 2018  
CONGRESS BACK IN SESSION    Congress back in session rarely good for sentiment though it was pretty low the last week, without Congress around. And FaceBook’s CEO/Founder Zuckerberg will be before the Senate Tuesday, and the House on Wednesday. Given the Trump market gains have been reversing, with a mid-term election ahead, expect members of Congress to posture Tuesday & Wednesday, perhaps chafé at the thought that Zuck could buy them all and have plenty of assets left over. Still, there’s been little said about Cambridge Analytics’ help to Trump & the Republican Party. Why’s that?

The other big even of the week is the Release of Minutes of the FOMC March 20—21st out Wednesday, at 2pm. Given how little is known about new Chair Powell’s positions on much of anything (aside from his comments in a speech, last Friday), there is much that might be learned from the minutes—including the rise in members to 7 out of 15, from 4 earlier, in favor of faster rate hikes. Then again, it’s a shame there’s been so much backlash against th4e appointment of San Francisco Fed’s leader, John Wiliams, to take over from retiring William Dudley in NY. Why wasn’t Dudley appointed to head up the entire FOMC? Surely, that’s why he’s leaving, because Powell was chosen over Dudley, when we don’t even know if Dudley was in contention. US PPI & CPI, Tues/Wed. not likely to attract much concern, no matter how much attention they might attract. Amazon is the most deflationary force in history. As long as it’s growth anything better than 25%, it will continue to exert downward pressure on US Prices. March Chain Store Sales, Thursday? Not only don’t enough companies report their monthly sales to glean any intelligence but Quarterly insight doesn’t arrive until May.

Earnings don’t become interesting until Thursday’s BlackRock & Delta Airlines, and even more so Friday, with JPMorgan, PNC & Wells Fargo. BIG things are expected—17% earnings growth, much of it from significantly lower corporate taxes but, also, from heightened trading activity in March, when stock market volatility picked up to the benefit of JPMorgan, and next week, Goldman Sachs & Morgan Stanley. It’s not equally important to PNC or Wells. On the other hand, BlackRock’s fund flows could suggest some institutions lightening up on investments in favor of cash.

Broadcasters are meeting in Las Vegas but the real battle remains in a Federal Court, where AT&T is fighting with the government to complete its merger with Time Warner.

Tuesday’s Events, including Jefferies Complement Therapeutics, Digital (Auto) Dealer Conference, Grant’s Interest Rate Observer Spring Conference, and the Nat’l Kidney Foundation Spring Clinical Meeting are evens worth noting, even though MIPTV Global TV & Digital Content Market will draw more media, in Cannes France, thanks to celebrity attendees. Stem Cell Research & Regenerative Medicine, Thursday, is probably more eagerly awaited than most. Then, again, EASL, an International Liver Conference will, no doubt, be market moving.

Don’t tell General Mills and Kellogg but it seems at least half of their high cost problems could be solved with the trade spat, since China will surely try to buy fewer soybeans, oats, and wheat from the US. Now, if transport costs could only come down, too, there’d be no reason to even try to raise consumer prices for their cereals. And, of course, there isn’t much that will help shareholders overcome their aversion to the price GIS is paying for Blue Buffalo Pet Products but, hey! You can’t have everything.

The downside momentum didn’t look as awful on the charts as one might have expected after Friday’s 572 decline in the DJIA on Friday. Democrats were filled with "woe is me" when Trump won the election. Now that their worst fears are being realized, in a trade spat with China—a spat that can’t hurt China as much as it could US farmers, in particular. The Trump momentum trade is over. Now, it’s time to sell the rips rather than buy the dips, unless reaction to this week’s earnings are a heck of a lot more bullish than I expect.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here.)

© Sandi Lynne 2018 Nothing Contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

April 01—06, 2018   MARKET WILL CONTINUE TO SEEK DIRECTION   If you think April will suddenly reverse the volatility and pressure of March, think again—at least until the due date for US Income taxes passes, on 04/17. That’s because procrastinators everywhere have until then to fund retirement accounts, whether at 401 K’s at work or IRAs, while older workers & retirees must complete their mandatory, annual retirement withdrawal, or to file their taxes or extension request but pay the taxes that are due—even if they take an automatic, 6-month extension. So, there’s a flood of money moving in and out of brokerage & mutual fund & retirement accounts, last minute funding, offsetting last minute withdrawals. April has often delivered the best gains for the DJIA but, often, those gains don’t start racking up until a week start until the later part of the month. That 2nd half of the month brings the start of Q1 earnings releases, most of that from financials. And that should be good for the bulls, since their taxes are falling significantly, and most—Deutsche Bank, HSBC, Barclays & Wells Fargo excepted—have shed the burden of fines and penalties. Along that line, note the CCAR & Dodd-Frank stress tests are due by the 5th, Thursday, the results to be announced in June.

One of the most interesting events, this week, may well be around the larger amounts of debt the Fed allows to roll off with reinvestment onto its balance sheet.. As of April, the New York Federal Reserve will be reinvesting in the same class of debt only amounts that are in excess of $18B in maturing Treasuries, and in excess of $12B of Agency MBS. When the Fed first started holding back some of the funds maturing, to leave the cash on its balance sheet until sent to the US Treasury, last October 2017, the amount of Treasuries allowed to roll off was at only $6B, and for Agencies, the amount was merely $4B. As Sen Dirkson once said, "a billion here and a billion there, and pretty soon you’re talking real money." Given that the amounts not reinvested will continue to increase, quarterly, for a couple of more years, the weekly release of the Federal Reserve’s balance sheet (Thursdays, after market close) will become a more closely inspected document than it appears to be, now.

And, of course, the March US Unemployment Rate will be released Friday. Given the outsized number reported for February--313,000 jobs added--expect revisions. Makes no sense that the shortest month of the year (Feb), and one that saw the middle of the country & east coast slammed with paralyzing snow storms, shows the best hiring in years. The Feb report at an incomprehensible.313,000, would surprise even more if there isn’t a large revision released with the March report.. The number of Motor Vehicles sold in March is the other item on the Economic calendar likely to be closely scrutinized. Again, a short month & snow storms that paralyzed a decent portion of the country weighs against record sales. And even if there was a record set, the size of incentives will surely be held up in dispute.

The Earnings schedule is for one of the lightest weeks of the year. Discretionary outfits that sell to consumers are the bulk of the slight report, CarMax, Fed’s, Lennar, and PriceSmart speak for themselves. Monsanto reports Thursday, and will not hold a post-release conference call because its take-out by Bayer is pending. I was sure that CFIUS would block this deal but it doesn’t appear to be in mortal danger, at all. Schnitzer is a steel company, so it ‘s first out of the gate to project how much the Trump tariffs on steel will mean to a US Company. Conn’s is scheduled to report, Thursday at 10am cdt on the 5th, Thursday. It was, not too long ago, bankrupt and closed a serious number of stores. However, in addition to any damage it might have suffered from Hurricane Harvey, there’s an equally tantalizing possibility that the damage wrought by Harvey spurred a serious surge in sales of appliances and other household goods. I wouldn’t buy a new dishwasher from a company I wasn’t sure would be a round in a few months,or in a year but other people wouldn’t care and buy from whomever’s price is best. For me, CONN is a pariah, for others a salvation, given how much of its business is built on credit extended to buyers, those borrowers, often, on shaky ground.

As for Events, there are barely any.. Here, kids were off from school for a week, starting March 19th. Other school districts were closed last week, and still more this week. So, given investment banks can’t send inquiries to every school district or portfolio manager, it appears the I-banks just avoided scheduling too many activities for this week. Starting with Morgan Stanley’s Healthcare Insight Panel, through Credit Suisse’s 4th Australian Corporate Day, in Boston, of all places, through Cowen’s Annual Future of the Consumer Conference, and Jefferies Immuno-Oncology/Cell Therapy Summit, in Boston, and its Healthcare REIT Summit in NY, there is I-bank activity each day this week but nothing like the typical, winter week.. And none of them likely to move the market or sector.

I don’t expect moves as large as we saw on several days in the past 2 weeks but also don’t expect the bulls to show they won the March war. On the contrary, I expect more swings up and down because traders aren’t sure which swing to bet on, and won’t know until the earnings from financials start arriving the week of April 9th, through the week of April 16th which coincides with IRS’ tax due date, on the 17th. (15th is a Sunday, the 16th is Founder’s Day, when some IRS offices are closed.) Just recall that even when financials please, and stocks run up in response, the reports scheduled for the last week of the month may not please as much as banks do but, benefiting from a lower tax rate, should still report big comparative upside versus last year’s Q1.

ECONOMIC: (Highlights, only, here. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The Opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

March 27—20, 2018  
MARCH’S END CAN'T COME SOON ENOUGH FOR BULLS    March’s end can’t come soon enough for the bulls but is coming fairly fast, with most Western Markets closed Friday, including US Markets, & Treasuries closing early on Thursday, to usher in the Easter Holiday. Passover, likewise, arrives on Good Friday, at sundown, a Sabbath start requiring a few extra prayers to push back dinner.

As is typical for the end of any month, housing data will dominate the releases, including the S&P Case/Shiller Jan 20-city Home Price Index Tuesday, NAR’s US Feb pending Home Sales Wednesday, and the final update on US 17Q4 GDP, also Wednesday. The US Treasury will auctions only $29B 7-year Notes but the longer durations have been shunned of late, and could put the kabbosh on Quarter’s end. And what a quarter it’s been, gains racked up in January given back, and then some, in March.

Spring seasonal clothing sales usually ramp into Easter. Not this year: Not only is Easter so early Good Friday falls in March but a Nor’easterner blanketed the East Coast with snow, which puts a chill on sales of spring fashions. Next year, comparisons will be tough since Good Friday isn’t until April 19th. Even those used to markets that serve up surprises, will be surprised by the comparisons.

Earnings are, again, dominated by discretionary companies, though the number of reports start slimming down until mid-April, when the banks report in quantity. And it might be mid-April’s bank earnings that it takes to reduce the extremes we’ve seen for 4 weeks or more. Before the next earnings cycle starts in mid-April, though, we’ll have to get through the FOMC Minutes, on the 11th, which may reveal more about where the Powell FOMC is headed than the 43 minute post-meeting press conference did. Powell did throw out the tidbit that PCE remains the FOMC’s favored assessment of consumer inflation but not much more.

As for Events, the NCAA’s March Madness will not be as big a distraction as it was last week, since the number of teams that remain in the hunt have been trimmed considerably. NVdia is one stock to watch, as it hosts its Investor Day on Tuesday. Jefferies’ Consumer IR Summit might be the star of Tuesday’s other events, since it’s rich with retailers & restaurants, while WWD’s Men’s Wear and Global Shop will add to the interest in discretionary names that came to life in Feb. JPMorgan’s Wednesday West Coast Energy Infrastructure/MLP 1x1 Forum couldn’t be more perfectly timed for those who want to know what the MLP tax ruling handed down last week means for the group and any specific names attending. Barclays Materials ROC Stars Conference is well timed because the Street has hosted one healthcare conference after another, since JPM’s in January, and it’s time for fresh topics. Needham does seem to bat cleanup on that topic, which probably won’t offer anything new.

The forces of end of month & quarter will compete with the Portfolio Managers who’ll be trying their best to salvage how the Quarter looks to their mutual fund investors. VIX isn’t as high as it should be given the steep decline seen last week. Stocks could go either way, this week but the downside conviction could be stronger than any upside impulse. What happened to 50 cents? Remember the guy or firm that was buying downside puts waiting for a pullback? None of the weekend press either mentioned him or the profits he made last week, though they did during the early February pullback. It would be a shame to learn there were so few short the market into last week’s massacre there are few who need to buy to close out their positions into the weekend holiday. That’s bad for the bulls, if there are still any.

ECONOMIC: (Highlights, only. Full International Economic Calendar, here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

March 19—23, 2018   POWELL the STAR    Some are talking up the FOMC going for a half point increase this week, instead of the quarter point hikes that started in Dec 2016. How could someone think Powell is going to disrupt the markets on what’s really his debut as the chief. Instead, I think anything new he’s contemplating adding to his Fed will be glimpsed in the minutes, due out on April 11th. I doubt that he’s thinking about half point increases but think Powell could cut a different path by adding a press conference after each meeting, instead of the quarterly ones that Bernanke & Yellen adhered to. In fact, it’s something he briefly touched on in his Senate confirmation hearing testimony—and something even Yellen dismissed by saying, "I suspect you folks will show up if we suddenly add a press conference to the schedule, at the end of the first day of out 2-day meetings. And that’s something I wonder about, also: Single day meetings were commonplace pre-2008 disaster but haven’t appeared in the past 11 years. With the unwinding of its balance sheet on automatic pilot (the amounts allowed to roll off rise on April 1st), and inflation still not close enough to 2.0% to satisfy the Fed doves, Neel Kashkari of the Minneapolis Fed would strenuously voice objection to a half point hike, especially with the Atlanta Fed’s GDPNow just lowered to less than 2.0%, the magic but illusive Fed goal. And trust me, Kashkari’s not one easily quieted by any chairman—no matter how new or long standing.

There are other central bank meetings this week, the 2nd most important the Bank of England, Carney’s press conference likely to attract some Financial TV attention on Thursday morning, before the open. RBA (Aussie) March Meeting Minutes will be out, overnight, Monday. Brazil’s Central Bank Rate will be set Wednesday, while the SNB (Swiss National Bank) releases its Annual Report on that night, even as the G20 Central Bankers & Finance Ministers are supposed to be in Buenos Aires (Argentina) for one of 4 meetings that segment of the G20 planned for this year.

The Earnings Calendar is surprisingly heavy with retailers, an apparel manufacturer, a couple of restaurants, and 3 solar firms. The only names reporting with the power to infect the market—or their sector, are homebuilders Lennar & KB Homes, database tech Oracle (Monday), FedEx (Tuesday), and Micron Technology (Thursday), along with consultant Accenture, that day, also. Nike and Finish Line report on Thursday, along with Micron Technology, while the one to watch may well be Lands’ End, as Sears tees up new lists of stores to be closed with virtually every press release. Lambert has people with signs standing on corners on the main drag through town, promising up to 80% and the fixtures for sale but that means he’s closing Lands’ End stores more quickly than LE could replace them. And maybe it won’t, given that catalog & online sales were its primary channels, for decades. Meanwhile, the Solar Companies reporting are likely to be key players at Solar Power Finance & Investment, in San Diego, starting Tuesday.

Now, with respect to 2 major tech companies reporting this week, ACN & ORCL, I have a point to make about IBM, should either of the two reporting give traders a reason to sell down IBM. The company Introduced a new mainframe in Sept 15th, 2017. As a rule, sales and signed maintenance contracts start adding to profits about 9—12 months after introduction—as machines at customers’ on beta test start converting to sales. If IBM doesn’t knock the cover off the ball in April, it probably will by its July report. Some of this might be reaching analysts’ ears at THINK & InterConnect, in Las Vegas, starting Monday. Ironically, Microsoft starts its Tech Summit the same day, in San Francisco but it’s AT&T’s Federal Trial to restore its deal with Time Warner that might catch a lot more press, at least for the first week of what the judge said is expected to take eight weeks. But, if you’re waiting with call options for MU to blow past analysts’ consensus, when it reports Thursday, take not of Wafers to Wall Street—changing Investor perceptions, growing trends in Semiconductors, then keep an eye on Qualcomm & nVidia, QCOM’s shareholders holding out for a higher bid undone by presidential decree, even as it appears that’s not top for NVDA anywhere in sight.

Macquarie Consumer Bright Ideas range from Hilton & IMAX to Las Vegas Sands, Ralph Lauren, Target, Tiffany, & Vail Resorts, and lots more. Many of the same companies will show up at Telsey Advisory Group’s 10th Annual Spring Consumer Conference (TAG born in the wake of Bear Stearns’ sale to JPM, and Lehman’s collapse). Dana Telsey is still widely respected by the Street, and a frequent CNBC guest. More retailers will appear at ShopTalk, which started Sunday.

It’s a little weird that Winnebego always seems to report earnings in the middle of a convention, the industry’s 97th started Sunday. GDC, for Game Developers & independents starts Monday but in recent years has been eclipsed by Licensing, usually in NY, in June. With Toys R Us liquidating, there’s going to be a lot IP looking to sign deals with new entities, so they can replace Toys’ share. Platts 14th Annual Steel Markets North America will be in Chicago, starting Tuesday, the day Morgan Stanley opens its European Financials Conference in London.

OpCo’s Healthcare Conference starting Tuesday feels like "yet, another healthcare conference," after 8 major ones that started back in January, with JPMorgan. Bk of America Merrill Lynch’s Global Industrials will get more attention in London, though it’s Thursday’s line up that’s most intriquing: ATD for Truck Dealers, NADA for the Auto Dealers Association, aided by J.D. Power’s Automotive Summit, And Automotive News’ Retail Forum @NADA. So how did MATS (Mid-America Trucking Show) wind up on the same dates, but instead of in Vegas, where ATD & Automotive Dealers meet, in Louisville KY. J.D. Power, for those curious, was bought by the Chinese.

And it all that wasn’t enough, S&P does some quarterly rebalancing, after the quarterly index options & futures expire. And you sure want that on your radar screen, as well, even if Jerome "Jay" Powell will be the star of the show. I expect him to be Yellen 2, early in his term.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be considered a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence..

March 12—16, 2018   WEEK BETWEEN    This week is the week between, notable, mostly, for the amount of debt the US Treasury is going to auction, in contrast to last week’s light schedule. Monday’s 10-year Notes & Tuesday’s 30-year Bonds are the most dangerous, based on recent auctions. The longer the terms, the worse the debt has fared, even with the rest of the world offering much lower rates on their sovereign debt. The Street will have its eye on next week, this entire week, in anticipation of Jerome Powell’s first post-meeting Press Conference, and the updated forecasts of FOMC members. Do any now see 4 rate hikes this year? Better put: How many now see 4 rate hikes this year, in anticipation of Trump’s tax reform juicing business earnings.

The 313K jobs added in Feb just doesn’t ring true for me. Not only was it a short month—not even a leap day to it—but a snow storm kept many from reaching jobs they might have otherwise. So, unless all those added jobs—say 113K of them in excess of Street’s assumptions—all were hired to plow snow, I expect that 313K print will be revised away over the next 2 years. And watch out if either US Feb CPI (Tues), PPI (Wed) or Retail Sales (Wed) suggest a whiff of inflation. It’s what got stocks down in early February, last week’s Employment Report backing off the bigger rise seen in Jan. As for NAHB’s March Housing Market Index, Thursday, now’s about the time for analysts to speak out in builders’ favor, in anticipation of a strong spring selling season before mortgage rates move even higher. .

It’s a light earnings week, the biggest names in retail already out with reports, this week’s reports more curiosity than market movers, perhaps with the exception of Broadcom & Ulta Salon, (Thursday), and Tiffany Friday, with a quiet nod to Signet & Williams-Sonoma, both Wednesday. Still, with the exception of Broadcom (AVGO), better watched for its Qualcomm bid, interrupted by CFIUS, for now, there’s no earth shattering reports on their way this week.

Trust me, The Quadruple Witch Expiration Friday will be more significant than any of the Economic Data or Earnings. Still, the Events Calendar has some events worth pointing out. Cowen & Barclays host Healthcare, or Health Care & Healthcare respectively, Monday & Tuesday. Citi drops into Shipping Day at the Capital Link 12th Shipping Forum, while RayJay does the same at OFC & Satellite 2018. Stephens has some of the most narrow events planned, mostly on the West Coast, the participants named on the calendar. Ditto Deutsche Bank with Basic Materials, on Wednesday, even if Trump’s Infrastructure plans have gone nowhere, and probably won’t go far while Gary Cohn’s seat in the white House is vacant. So watch that Quad Witch, and remain prepared for S&P’s rebalancing, since it’s likely to result in financials & technology representing heavier weightings. And some give back after last week’s outsized gains seem in order, too.

ECONOMIC: (Highiights, only, below Full International Economic Calendar here)  

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author's, alone, and should be just one factor in more complete due diligence.

March 05—09, 2018  
TARIFFS NOT AS ORIGINALLY SHOT ACROSS THE BOW?  There seemed to be some back tracking on the severity of tariffs the Trump White house will levy on steel & aluminum, over the weekend. At a minimum, there was talk about exemptions, which is all well and good, but doesn’t solve the problem of the enhanced influence Peter Navarro may be having on the President.

Note how little debt the Treasury is planning on offering this week. Three-month, 6-month, and 4 week is It! That may help keep stocks from falling too much more, especially if the rumored exemptions become reality. But with so many central bankers speaking—our own, as well as the rate setting committees in Australia, Canada, at the ECB, and, finally, into Friday, the BoJ. The latter has dropped the taper bomb with no repercussions, as yet.

The Earnings Calendar is concentrated around consumer names, including many retailers & restaurants. Target & Ross Stores should lead on Tuesday, Costco Wholesale & Dollar Tree on Wednesday, Kroger on Thursday, though I also emboldened a few names that are less followed, because it might be time to give them more attention. In the same vein, note the analyst meetings, this week, Chevron, Lam Research & Target on Tuesday, when half the tech analysts will be focused on Qualcomm, and the nominees to its board that Broadcom is asking shareholders to approve. Given that QCOM basically told AVGO that it will take more money than what’s been offered, I suspect shareholders will hold their ground with current management. ExxonMobil is hosting its Analyst Day Wednesday, Cott on Thursday, while Bank of NY Mellon, CBRE, & USG on Friday.

Big Events include IHS Markit CERAWEEK, which starts on Monday, the 5th, include well known speakers Dr Daniel Yergin, DoE Sec’y Rick Perry, Saudi Armaco’s Amin Nasser, GM CEO Mary Barra, RDS.A CEO, OPEC Sec’y General Barkindo, Canada’s Minister of Natural Resources, the leaders of OXY, BP, IEA, UAE Minister of Industry & Energy, DUK, FCX’s LNG, Trafigura, Xcoal Energy, SLB, Siemens, Reliance Industries, Mitsubishi Heavy, DOW Chemical, FERC, Edison Int’l, PG&E, Exelon, EMR, Petronas, COP, CPN, HES, YPF, BHGE and more So one highlight of the week.

Also starting Monday, Deutsche Bank’s Media, Telecom & Business Services Conference in Palm Beach—if the NY area and other East Coast airports can reopen. There’s a break before JPMorgan opens Gaming, Lodging, Restaurant & Leisure Management Access Forum starting Thursday, a day on which Bank of America/Merrill Lynch hosts Refining.

A fantastic 16-month run up after the election doesn’t have the excesses wrung out of it by 3 or 5 days of selling. Still, should the White House include exemptions from the Steel & Aluminum tariffs, as rumored over the weekend, then a bounce would not surprise but it won’t solve the problem of Navarro’s growing clout, or the wild man elected President who loves to shock & awe.

ECONOMIC: (Highlights, below. Complete International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed is the author’s, alone, and should be just one factor in more complete due diligence.

February, 26th—March 2nd, 2018  
CAN POWELL TALK AND SAY SOMETHING?   FOMC chief Powell’s testimony at House Financial Services Cmte moved to Tuesday from Wednesday, due to a scheduling issue. He reprises his testimony in the Senate on Thursday. This will be his first solo testimony, at which we’re not likely to learn as much about his positions as the Street wants to know. For balance, ECB’s Draghi testifies at the EU Parliament, Sunday night (Monday European time). His days are numbered, since his term ends next year, and there’s already jockeying for his position. While we’re on the subject, other Central bankers speaking include Bullard, Vice chairman Quarles, even as Governors at NGA will split up, Monday, and meet with either Trump or Pence at the White House.

Big Economic Data is centered around housing, including Monday’s Jan New Home Sales, & Tuesday’s Case Shiller Dec Home Price Index & FHFA’s Dec Home Price Index. December? Why would the Street wait for that when Zillow and other sites are updated sooner? OK, Ok, FHFA I get because it compares sales of a specific house with its prior sale but S&P Case Shiller CoreLogix? They have time to add more titles but not to push out the data faster?

One big event, this week, is in Barcelona, rather than the US. It’s the GSM Mobile World Congress, Samsung supposed to debut its Galaxy S9 at the show, on Sunday, before the show officially opened. Sony’s Monday press conference presumably is to unveil a new smartphone, too, while Huawei is expected to launch its latest, even as HMD Global, holder of the Nokia licenses, is expected to debut at least one new smartphone.

Other big events this week, closer to home, include Morgan Stanley’s Tech, Media & Telecom Conference in San Francisco, JPMorgan’s Global Emerging Markets & Global High Yield & Leveraged Finance both meet in Miami Beach, and overlap. There’s, also, the 11th Annual Medicaid Managed care Summit, Citi’s Asset Management, Broker Dealers & Market Structure Conference, BAC/MER’s Global Agriculture & Materials Conference, KBW Cards, Payments & Financial Technology, in NY. The largest US corporate meeting is AAAI Jointly with the World Allergy Congress, starting Friday, in Orlando.

All in, a very busy week with much of what happens dependent on what Jay Powell says in 2-days of Congressional testimony. He may not have mastered the art of saying a lot without saying anything but, then, maybe he’ll be more like Janet Yellen, and not really look to do anything but honestly guide markets and rates. The questions is what’s his favorite indicator? For Yellen, it was PCE—Core Personal Consumption Expenditures. For Powell? That is the question.

Consumer names own Earnings, this week, including Macy*s, Nordstrom, JCPenney, TJX, Barnes & Noble, Best Buy, FootLocker, Lowe’s, Big lots, Gap Stores, Kohl’s, to name just a few. My bet is JPMorgan Chase’s analyst meeting will be more influential. Furthermore, I expect some of the air that’s was blown into retailers after holiday sales were not as devastating as in past years to leave the shares after they report. The wonder wasn’t that Walmart fell after it reported a miss but that the Street had fallen so in love with WMT, into its Q4 results. The two stores closest to me are still filthy, poorly stocked but distasteful locations that no one seems to care about.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

February 19—23, 2018   ANOTHER SHORT WEEK THAT COULD FEEL LONGER THAN IT IS   I thought about highlighting Walmart’s earnings, or maybe WMT & Home Depot earnings, and stopping there (both Tuesday) but, in the end, the volume of restaurants reporting weighed against that fleeting thought, suggesting more angles for consumer spending to be examined. Still, I think the week amounts to those 2 reports, because the FOMC Minutes, out Wednesday, will still reflect the Yellen Federal Reserve, not lead by Jay Powell. Put February 28th on your calendar for his starring role at Congress.

Otherwise, what stands out this week is China’s Lunar New Year celebrations, which means no guidance from the far east. And that’s unfortunate, in a week that includes so much Treasury Debt at Auction, including $55B worth of 4-week bills, an amount I can’t say I ever remember seeing. Add in larger than previous 3-, & 6-month Bills, plus 5- and 7-year Notes (Wed/Thurs), and the Asian absence could be felt, the longer the term, the more dampened interest, of late.

And it’s not like we’re not going to hear a lot from FOMC speakers, this week. It’s bonanza time, some on the Street fairly vocal in their wish that Powell would tamp down the competing viewpoints espoused intra-meetings.

The Conservative Political Action Committee meeting just outside D.C. promises Trump, VP Pence, Ed Sec’y Betsy DeVos, Sean Hannity, Ajit Pai, Mick Mulvaney, Sen. Ted Cruz, Pawn Stars’ Rick Harrison, UK’s Nigel Farage, and many others that aren’t equal bold-faced names. Still, that grumbling you hear during the week may just be liberals nursing stomach aches. NGA, the National Governors Winter Meeting is also in D.C, this week, a speaking invitation to the Pres. no doubt out months ago. If that’s happening, it’s impossible to say. The Event Website offers a skeletal Agenda, without details. It won’t be a repeat of CPAC, though.

In other Events, CAGNY(Consumer Analysts of NY) stands out, Monday, because the package foods industry, the dominant speakers, need some inflation to grow their earnings. One surprise invitee is JNJ. Wednesday also stands out because both Citi & Barclays are hosting separate Industrials Conferences that start that day, both in Miami. What were the odds? Thursday’s 94th USDA Ag Outlook Forum: The Roots of Prosperity is scheduled at a time when farmers are looking at some of their worst earnings, another group that could use some inflation to boost prices of commodities.

So, a market that’s a little directionless without Asia doesn’t mean stocks can’t continue their recovery, but does increase the odds that stocks may be looking up at nearby resistance, and feel a need to chop around consolidating the territory already recouped since the Fed Chief Powell swear-in sell off that started on 02/05.

I have 2 off-topic comments: Since when does flying down a mile-long ice structure at 60 mph, on a lunch tray with handles constitute sport? I realize some "sports" Ndate back to win men went out with guns & clubs to catch dinner but skeleton? Are you kidding me, calling it a sport?

And then, I have to say something about the Parkland massacre, which occurred less than 11 miles from where we live, and 2 years ago, might have trapped one of our god children in the madness. I get that the constitution allows for citizens to arm but nowhere in the constitution did the founding fathers either explicitly or by inferrence extend that right to automatic weapons which they could neither anticipate nor cite. It is time for automatic weapons to be left to law enforcement and the armed forces but kept out of citizens hands. Sandi

ECONOMIC: (Highlights, only below. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

February 12—16, 2018  
HOW DOES THE STREET REACT TO BLOWING UP THE DEFICIT BY ANOTHER $200B?   Whether the latest volatility runs its course by this week could depend on how the Street reacts to Trump proposing adding another $200B to the deficit on infrastructure spending. Recall, the problems started in the debt markets, so that’s what must be watched, still. Meanwhile, 3 weeks sick makes me wonder how deeply this year’s flu epidemic curtailed worker productivity.

ECONOMIC: (Full Int'l Economic Calendar here)

© 2018 Sandi Lynne Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.
February 05—09, 2018   CORRECTION COULD FIND A BOTTOM BY END OF WEEK      Sandi’s still very sick and doing as much as she can.

Time was, Super Bowl was a 4-day weekend of events for fans who’d spend $20--$45 to roam through football fandom. For 2018, the festivities have been going on since Jan 29th, and there was, even, a 19th Annual Super Bowl Gospel Celebration. This surprises me because I attended one of the Super Bowl weekends in Miami, maybe even more than 19 years ago, and this is the 1st time I’ve seen a "Gospel" celebration on the schedule. Tix were $20, and some were still available as of Thursday afternoon, 02/01. Here’s the other head scratcher I found on the NFL site: A location is listed for drop off and pick up of Uber, Taxi’s, & Lyft but no vehicles for hire—Limo, Sprinter, Mini Bus or Motor Coach--is allowed to drop off or pick up at US Bank Stadium. I realize Super Bowl moves around, so all NFL teams get a chance to host the game—and rake in all the bucks associated with the event but, really, given the early February scheduling, why wouldn’t the NFL pick a stadium in a warmer climate than Minneapolis? Even the covered stadium doesn’t spare anyone the inhuman sub-zero temps getting there and back

ECONOMIC: (See FULL International Economic Calendar Here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

January 22—26, 2018 
FLU GOT ME DOWN, Sandi  Sick as a dog this past 4 days, so the Full International Economic Calendar didn’t get made. Below the best we could do.

Full International Economic Calendar can be viewed, here)
SUNDAY, 01/21

MONDAY, 01/22
IMF World Economic Outlook Press Conference (Davos)

TUESDAY, 01/23
WEC: World Economic Forum
Annual Meeting (Davos-Klosters, Suisse thru 26tth)
Bloomberg Year Ahead & Smart Economic (Davos thru 24th)
NAFTA talks Resume (Montreal Canada)



FRIDAY, 01/26

EARNINGS: We know longer separate pre-market from after market earnings releases. We cover only the major money center banks, the largest regionals, and foreign banks traded in the US. We ignore "the" in a corporate name unless it’s integral ot the ticker.







1st Stock Trades After Options/formerly LEAPS Settle
Argus Media Americas Crude Summit @Petroleum Markets Week (Houston TX)
Winter Rheumatology Symposium (Snowmass Village CO thru 26th)
Int’l Headache Academy (Los Angeles CA thru 22nd)
Enigma: Emerging Threats & Novel Attacks (Santa Clara CA)
Men’s Haute Couture Week (Paris France)
Imprinted Sportswear (Long Beach CA)
CHA Crafts & Hobby MEGA Conference/Trade Show (Phoenix AZ thru 22nd)
DLD18 Digital Life Design (Munich Germany thru 22nd)
BioInformatics (Madeira Portugal)
AO—Australian Open Tennis Championship, 1st of 4 majors (Melbourne thru 28th)
Sundance Film & Arts Festival (Park City UT thru 28th)

Inside ETFs (Hollywood FL thru 24th)
VRC Vancouver Resource Investment Conference (Vancouver Canada thru 22nd)
RILA Retail CEO Forum (Tucson AZ thru 25th)
NDIA Winter Simulation Innovation Workshop (Orlando FL thru 26th)
Keystone Organ Crosstalk in Obesity & BioEnergetics + Metabolic Diseases Symposium (Keystone CO thru 25th)
PTC’18 Pacific Telecommunications Council (Honolulu HI thru 24th)
Fancy Foods Show (San Francisco thru 23rd)
24th Annual SAG (Screen Actors Guild) Awards (Los Angeles and TNT + TBS TV)

MONDAY, 01/22
Health Benefits
Conference/Expo (Clearwater Beach FL thru 24th)
Tour d’ALIS Americas Lodging Investment Summit (Los Angeles thru 24th)
Citi @ALIS Lodging Summit Meetings (Los Angeles)
DDP: Drug Delivery Partnerships (Palm Beach Gardens FL thru 24th)
PMWC Precision Medicine World Conference (Mountain View CA thru 24th)
World Stem Cell Summit (Miami FL thru 25th)
CleanTech Forum (San Francisco thru 24th)
Macquarie A-Share Corporate Day (NY thru 23rd)
Call Center Summit (New Orleans LA thru 25th)
SIA SnowSports Industries America (Denver CO thru 24th)
AHR (HV/AC) Expo (Chicago IL thru 24th)
FETC: Future of Education Technology Conference (Orlando thru 26th)
Women’s Haute Couture Week (Paris France thru 25th)
LSE SU Alternative Investments Conference (London thru 23rd)
Credit Suisse HK/China Analyst Relay II Showcase (Hong Kong)
European 3D Summit (Dresden Germany thru 24th)
Nike (NKE) hosting Macquarie clients at Hdqtrs (Beavertown OR)

TUESDAY, 01/23
IECI: Electric National Business Summit (Las Vegas NV thru 24th)
DistribuTECH (San Antonio TX thru 25th)
MPMC Motorsports Parts Manufacturers Media Trade Council (Santa Ana CA thru 25th)
PGA (Golf) Merchandise Show & Demo Day (Orlando FL thru 26th)
AHA (Heart) International Stroke Conference (Los Angeles thru 28th)
IC3 Int’l Capital & Cannabis Conference (Miami FL thru 24th)
World of Concrete (Las Vegas thru 26th)
Pool & Spa Show (Atlantic City NJ thru 25th)
Scotiabank Multi-Family Residential Panel (Toronto Canada)
Euromoney 20th Global Airfinance Conference (Dublin Ireland thru 25th)
Future WAN ’18, an SD-WAN
virtual summit (thru 26th)
EFI (EFII) Connect: Users Conference (Las Vegas thru 26th)
Progressive Insurance (PGR) New York Boat Show (NY thru 28th)

CFANY (formerly NYSSA) American Gas Ass’n Luncheon (NY)
CIBC 21st Annual Whistler Institutional Investor Conference (Whistler BC Canada thru 27th)
Int’l FCStone Coffee Futures, Options & Structured Products Risk Management Seminar (Miami FL thru 26th)
IREI VIP: Vision, Insights & Perspectives Americas (Dana Pt CA thru 28th)
Yankee Dental Congress (Boston MA thru 27th)
ASTD Tech Knowledge Conference/Expo (San Jose CA thru 26th)
Deutsche Bank dbAccess Retail Store Tour (Manchester UK thru 26th)
MGF Global Games Forum (London thru 25th)
BETT Education Technology (London thru 27th)
Citi A-Share & Connect Day (Shenzhen China thru 25th)
China Int’l Printed & Flexible Electronics + Emerging Technologies (Shanghai thru 26th)
ISPO Beijing (Beijing China thru 27th)
Microsoft (MSFT) Tech Summit (Birmingham UK thru 25th)
Philip Morris’ (PM) IQOS System with Marlboro Heatsticks, including menthol Heatsticks, (MRTPA-Modified Risk Tobacco Product Applications) before FDA Tobacco Products Scientific AdCom
OSCAR Nominees Announced (Hollywood CA)

ASCO-SITC Clinical Immuno-Oncology Symposium (San Francisco thru 27th)
SNMMI Society of Cancer Research-Nuclear Medicine & Molecular Imaging Mid-Winter Meeting (Orlando thru 27th)
SurfExpo (Orlando thru 27th)
Guelph Organic Conference (Ontario Canada thru 28th)
Citi GPS: Risk Launch 2018 (London)
4th Annual Future of Healthcare Investor Forum (London)
34th IHS Display Search Japan (Tokyo thru 26th)
EGA (European Generic Ass’n) 17th Regulatory & Scientific Affairs Conference (London thru 26th)
Taco Bell (YUM) beings offering $1 Nacho Fries in the US

FRIDAY, 01/26
Food Marketing Institute Mid-Winter Executive Conference (Miami thru 29th)
School Mental Health: Treating Students K to 12 (Boston thru 27th)
American Bus Association Marketplace (Charlotte NC thru 30th)
Altria (MO), Reynolds America (RAI), Philip Morris Int’l (PM): FDA lays out approach to evaluating nicotine replacement therapies (NRT)
"Maze Runner: The Death Cure" with Rosa Salazar, Thomas Brodie-Sangster, Dylan O’Brien, Kaya Scodelario, based on the novel "The Death Cure," it’s the finale of The Maze Runner Saga, from 20th Century Fox (FOXA). "Hostiles," with Rosamund Pike, Scott Shepherd, Christian Bale, Stella Cooper, a period Western. Originally distributed to a limited number of theaters, on 12/22/17, Entertainment Studios bought US rights and is taking it wide, now. "Kickboxer: Retaliation," with Alain Moussi, Christopher Lambert, Jean-Claude Van Damme, Mike Tyson, & Sara Malakul Lane, a follow-up to "Kickboxer: Vengeance," distributed by Our House Films.

SPIE Photonics West (San Francisco thru 02/01)
Society of Cardio-Thoracic Surgeons Annual +AATS Tech-Con (Ft Lauderdale FL thru 31st)
AACR Obesity & Cancer (Austin TX thru 30th)
ASTA 58th Annual Vegetable & Flower Seed Conference (San Diego thru 30th)    

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

January 15—19, 2018  HOLIDAY WEEK WON’T FEEL LIKE ONE BY FRIDAY  Throw a dart on any day the rest of the week and you’ll find an important entry on the Economic Calendar. Some of the most important data will seep out from China & the UK, China’s growth essential to the worldwide growth & stability, the UK’s plan to exit the EU intensifying, as the clock keeps ticking. Then, there’s $135B in shorter term debt a boatload that will be easily absorbed. In addition to Jerome Powell’s appointment to head the Federal Reserve, which will be voted on, again, Wednesday, there are Evans & Kaplan speaking to Reinsurance Executives, Bk of Canada Gov Poloz and his Deputy Wilkins speaking after their monetary policy committee wraps a meeting, and the Fed’s Evans & Kaplan speaking, too, to the Reinsurance Executive Roundtable, hosted by the ACLI (American Council of Life Insurers), in Palm Beach FL, along with the Fed’s Mester on monetary policy communications, hosted by ACLI (Am. Council of Life Insurers), in a brisker New Jersey.

Some of the Economic Calendar highlights are on housing, including China’s Dec. Property/House Prices, and the US’s NAHB Jan Housing Market Index, & Dec Housing Starts/Building Permits, along with the UK’s Dec RICS House Price balance. And, dare we say it, OPEC’s release of its monthly Oil Market Report, Thursday, when both Crude & Natural Gas will be released by the EIA, Monday’s holiday pushing crude stats out by one day. Also out Thursday, China’s 17Q4 GDP, Dec. Retail Sales, Fixed Asset Investment, and Industrial Production. Wed. we’ll get the US Dec Industrial Production & Capacity Utilization, snow storms likely to push up utility production, a large part of IP & CU every month.

And overhanging it all is the midnight, Friday, Jan 19th deadline for Congress to fund the government, or risk a government shutdown, which Trump said, at one time, might be good for the country. Really? They lock workers out of office buildings, send them home to nervously plot how to pay bills, without a paycheck coming in, all to collect back pay for days no one worked, once the "shut down" is over. And with a President as erratic as Trump, for all we know, he’ll make the funds for building the southern wall to block off Mexico a prerequisite for his signature on whatever continuing resolution or budget Congress sends to him. The Pope will be visiting South America this week, perhaps he’d like to put in a good word for hard working Americans, who fear the world is going to h—in a hand basket. Friday is notable for another deadline—the last day to trade January options that started as LEAPs up to 3 years ago. Those new to the market may not realize how recently weekly options were added, so not familiar with LEAPS that started trading as long ago as 2014.

The Earnings Calendar is, once again, dominated by financials, including Citigroup, Bk of America, Goldman Sachs, US Bank, American Express, Bk of New York Mellon, BB&T, KeyBanc, Morgan Stanley, Citizens Financial, Regions Financial, SunTrust, & Synchrony. A finance line up every bit as influential as last week’s. And if that weren’t enough, there’s CSX, Canadian Pacific & Kansas City Southern, teed up to report, along with UnitedHealth, Kinder Morgan, PPG, Taiwan Semiconductor, and Schlumberger, each a heavy weight in its sector.

Which brings us to the Events Calendar, well stocked this week, too. Start with NAIAS, the North American International Auto Show, put on by the Auto Industry, with related events from IEEE (Electrical Engineers), Automotive News World Congress at NAIAS, Deutsche Bank 2018 Global Auto Industry Conference, and IHS Markit Annual Briefing @NAIAS. Markit owns J D Power but the Power auto event is not concurrent with this week’s. However, the European Auto Salon takes place in Brussels, Belgium, starting Sunday, putting autos at the center of 2 continents.

Another, literally big show is the NRF BIG Show, in NY, which is more about the physical shop and processes than a fashion show. At BIG Show, one can order hangers and price tickets but not the clothes on which they’ll hang. Jefferies Winter Consumer Summit includes apparel manufacturers & sellers along with hotels & restaurants. Oddly enough, news out of SIHH Luxury Watch—Haute Horlogerie could trump some bigger events because the state of the high end watch industry has become a serious datapoint for deciphering the penetration of smart watches & other wearable technology, even as what’s going on at the very top of the luxury watch market says a lot about the spending by wealthy people, as well as those who must answer to the state, like wealthy Chinese buyers.

Also Sunday, Southern Seed, Plant & Animal Genome XXVI, Clinical Dermatology, and an S&P Global Platts Aluminum Symposium, along with Heart Failure, Retina, and State of the Brain. Monday, while markets were closed, Jefferies opened its 7th Winter Consumer Summit, Sunday, while ISS runs Semi Strategy Symposium, and ISS Strategic Materials Conference. Both meet at Half Moon Bay CA. NATPE (Nat’l Ass’n of TV Programming Execs) gets a lot of attention, as billions of advertising moves from TV to the small screen of mobile phones. MoffetNathanson is just one I-bank hosting clients at NATPE.

Another multi-leg event is Argus Media’s Petroleum Week which includes Americas Crude Summit, America’s LPG Summit, and America’s Motor Fuels Summit, all in Houston TX. Wolfe Research is hosting a "Thunder & Lightning" tour around Tulsa & Oklahoma City, visiting WPX energy, Devon Energy, Gulfport Energy, and Continental Resources. Wednesday, Peters & Co starts its Winter Energy Conference, in Alberta, while RBC is just one of 2 I-banks hosting Private Company Energy Conferences. The other is Credit Suisse. Wolfe also hosts an Oil & Gas Earnings Preview Lunch, Thursday.

It’ll be a busy week that won’t feel "shortened," by any stretch of the imagination. The fact that financials, again, dominate the Earning Calendar takes the spotlight off the reported earnings, to shine brightly on the out quarters. Based on last week’s reports, expect near term write downs and charges required by the tax cut bill, though reserves for taxes will be far lower, going forward, sprucing up the future bottom line. Rails, PPG, and Taiwan Semiconductor offer less history, since last week wasn’t populated by peers. Still, with companies benefiting the most from the tax cut bill passed, there’s reason to expect forecasts that won’t upset anyone. (We won’t discuss how hard hit the same companies may look next year, when they’re comping against one time adjustments from this year, because there’ll be plenty of time for that. Bear in mind, the $1k employee bonuses announced recently are all one-off, which leaves workers with lower income, next year. When reality catches up with the calendar, employees will look shafted, while companies will look like the big beneficiaries they are, indeed.) What might start upsetting the market is the cost of gasoline at the pump, which is rising everywhere, not nearly caught up with the price of a barrel of crude, at recent times. Some retailers will complain about refunds arriving late, the IRS not even accepting tax filings until Jan 29th.

Last week’s huge gains were surprising. Expect a period of consolidation, at the least. I will personally being going farther, by looking for ways I can actively protect my gains.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)  

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the authors, alone, and should be just one factor in more complete due diligence.

January 08—12, 2018  
EARNINGS SEASON SNUCK UP ON US    For all the hooplah around "Fire & Fury: Inside the Trump White House," Michael Wolff’s book on the Trump White House, neither the book nor the New York Magazine with an excerpt were available at the local Barnes & Noble. And that’s why the chain is likely to go 6 feet under—even the one here, directly across the street from the entrance to FAU. And there was no help to help, so when I looked up the book on the "help desk" computer, I was mistaken for an employee, and asked to look up Fire & Fury, about seven times before the computer return the message that it won’t be in until 01/09, the disk 3 days later.

There are 3 major events, this week, that will dominate the newsfeed: CES (Consumer Electronics Show), JPMorgan Healthcare, and ICR Conference, the latter with separate schedules for public and non-public companies. What’s remarkable is the number of I-bank events scheduled around all 3 events, in a last throwback to the mid-90’s, and COMDEX, when those in-the-know could time options purchases on Microsoft and, (back then), Compaq, timed to capitalize on the dinners Goldman Sachs would host on successive days, and the upgrades for each of them that arrived like clock work the day after the dinner at which each starred. And back then, it was not only Goldie’s dinners, cocktail parties, and morning after upgrades that made COMDEX such a tradable event, but the dates of COMDEX itself, when there was no internet to search. In fact, Wall Street In Advance began as a full year’s printed calendar, the top events neatly featured on the days those events started. At one time, COMDEX was bigger than everything.

CES Intel CEO Krzanich delivers the Keynote on Monday, while nVidia keynotes Sunday night, before Intel. NVDA wowed in 2017, talking about its autonomous cars & AI that needs its chips. INTC can no longer pretend it has nothing to fear from NVDA, as the latter has successfully convinced investors and analysts that it moved from graphics chips to chips that power servers, autonomous vehicles and AI. Ironically, Intel is expected to roll out lots of new chips, at CES, especially high end ones for laptops & gaming but including a chipset that includes an AMD graphics chip—a rare collaboration between the two, on the I7 CPU that incorporates an AMD Radeon GPU chip, suggesting how serious INTC is about matching and surpassing NVDA. Some are eager to hear what CEO Krzanich plans in AR/VR after it shut down Project Alloy, its VR headset project. INTC does have a project to stream MLB games in VR. FCC Chairman Ajit Pai canceled his scheduled appearance at CES, citing death threats. JPM & Citi host events at CES.

Many retailers & apparel/shoe manufacturers, restaurants & leisure parks will be updating their Qtr outlook at the 20th ICR, this week. I.e. Kohl’s CEO Kevin Mansell is scheduled to keynote at noon, on the 9th, updating its holiday sales guidance. It won’t be alone, Others not appearing at ICR, like Tiffany, schedule a separate holiday (November/ December) sales update, for TIF, on Jan 17th. (While the timing for TIF’s call hasn’t been announced, yet, 8:30am is when it hosts earnings conference calls.) The best way to gauge when holiday sales updates will arrive, short of looking up every company individually, would be to load the ICR Conference
presentation schedule, and assume every company on the agenda plans to update holiday sales, on the 8th or 9th. Private companies present on the 10th. There’s one track for retailers, on the 8th, in the morning, that starts with SEAS, moves to ASNA, CROX, LE, LULU, CHS, before the luncheon keynote. On a separate track, it’s restaurants: RUTH, CHUY, FOGO, RRGB, TACO. I-banks like Citi are hosting clients here, too. ICR is the meeting that has the most satellite meetings of I-banks and their clients, including Wells Fargo, Citi, Raymond James, and more

And then, there’s the JPMorgan Healthcare Conference, that attracts more "satellite" events than any other, throughout the year. Even Leerink, one of the most respected Biotech I-banks schedules events to coincide with JPM.

Normally, I’d be pointing out all the Fed Reserve speakers, this week but with a new sheriff coming to town, I feel about those events the way I did about last week’s Fed minutes from its Dec meeting—new voters and a new chief made the minutes of little interest. But, with the two doves who dissented against the rate rise in Dec leaving the voting panel, and at least one emphatic hawk getting a vote in 2018—Loretta Mester—we’re all in the dark until we’ve seen a couple of meetings, and the minutes that result. John Williams, also joining the voting in Feb., is more hawkish than the rest of the FOMC except Mester. Mester spoke of 3, or even 4 hikes this year, while Williams seemed to endorse the 3 already planned by the SEP (Member projections last released in Dec.) And let’s not forget that NY Fed Pres/CEO William Dudley is leaving this year, probably by the summer, which might be additional discomfort, as the Powell/ Quarles FOMC unfolds. Then again, Bostic is a newbie, speaking on Monday but talks to Rotary Clubs rarely are a setting for policy position speeches. And so it’s said, Yellen has said she’ll leave when her successor is sworn in. Everyone assumes that will be AFTER the Jan 30—31 meeting, on Feb 3rd, when her first and only term will end. But who’s to say Trump won’t see to Powell’s swearing in, sooner, ending Yellen’s term faster than expected—fast enough to put Powell in the chair at the head of the table, by the late January meeting.

Bits & Pieces: NAHB, the Nat’l Association of Homebuilders assembles for its annual show, starting Tuesday, which is the day Goldman Sachs is hosting a Global Energy Conference, both, coincidentally, in Florida which makes them attractive getaways after last week’s Bombcyclone. Pfizer said, Saturday, it will stop searching for drugs to treat Alzheimer’s and Parkinson’s Disease, giving up a fight that has cost so much and delivered so little. If Disney looks soft, that might be because "Star War: The Last Jedi" opened to very underwhelming ticket sales, in China ($28.7m over the weekend). The two Koreas are meeting this week, though I can’t imagine what will come of it: A promise not to bomb each other, when the North Korean midget wants to bomb the US? The Treasury is offering a boatload of debt, this week, and what bothers me is the amount of 3-, & 6-month debt on offer, every month, even as rates are rising and being pushed higher by the FOMC, elevating the costs to service that debt. At one time, Treas Sec’y Mnuchin seemed to favor really, really, long term debt, of the 50-year & 100 year really long but, instead, $90B of debt on offer this week will mature by summer, while 3-year Notes will amount to just $24B, 10-year $20B, and 30-year a mere $12B, the latter 2 reopenings.

And then, Earnings Season begins this week, Friday a huge day because BlackRock, JPMorgan, PNC, and Wells Fargo reporting, at the end of a week that will have, also, included Delta Airlines, K B Homes, and Lennar. And watch out for CY17 Economic Data, because the Dec. Employment Report was soft.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2018 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

January 01—05, 2018
MORE PROFIT-TAKING TO START? Typically, the first few days of a new year start with some selling, as gains or losses were delayed until the new year. The balance switches after the December Employment Report is issues, late in the week, which also coincides with retail investors sending more funds to their mutual funds, which helps offset the selling.

Watch also the amount of principal the Federal Reserve allows to run-off without reimbursement because it doubles, as of this month, through Q1. For this Quarter, the amount that will be allowed to run off without reinvestment is double the amount of Treasuries & Agency MBS run off since the bank first started to hold back some reinvestment, in October. $12B in Treasuries & $8B in Agency MBS.
Addendum here.)

Daiwa P.U.R.E. Energy stands for Power, Utilities, Renewables & Environment., the first conference of the year (Hong Kong thru 5th). The one to watch, however, is the American Economic Association’s Annual Meeting, at which central bankers are the stars. In fact, time was the first week after the New Year was flush with major I-bank events but that’s not true this year. The Biggie is AEA, concurrent with ASSA (Allied Social Science Association) Annual. Rarely have central bankers been out in such a heavy presence so soon after the New Year celebration, and they’ll remain out through next weekend.

The call for this week, more selling than seen to end the year, which won’t be nearly offset by fresh funds flooding into the market & mutual funds, at least not until late in the week, coincident with the December Unemployment Report.

ECONOMIC:  (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

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