Weekly Data check

The New York Fed Weekly Economic Index:

Still waiting to form a bottom I believe
Weekly Johnson Redbook retail store index covering 9000 US general Merchandise stores,no online sales used

Not all bad news Atlanta GDPNow model reporting;

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the second quarter of 2020 is -41.9 percent May 19, up from -42.8 percent on May 15. After this morning’s new residential construction report from the U.S. Census Bureau, the nowcast of second-quarter real gross private domestic investment growth increased from -69.4 percent to -66.0 percent.

Morning 5-19

Let us Start with Some earnings…

    Walmart shares rose nearly 4% after the retailer said its e-commerce sales grew significantly as customers bought groceries, cleaning items and other essentials online during the pandemic.    The big-box retailer’s e-commerce sales in the U.S. shot up by 74% and its same-store sales grew by 10% in the first quarter. (CNBC)… To keep up with demand, it hired 200,000 employees to help clean stores, stock shelves and fulfill online orders

   Shares of Home Depot fell about 2% during Tuesday’s premarket trading after the company missed earnings expectations in the first quarter thanks to higher coronavirus-related costs. For the quarter, the company earned $2.08 per share, which was below the $2.27 analysts had been expecting. Same-store sales jumped 6.4%, beating consensus estimates of a 4.4% rise. Revenue came in at $28.26 billion, which was also higher than the expected $27.54 billion. The company said that coronavirus-related expenses – such as increasing paid time off for hourly employees – totaled $640 million, or 60 cents per share(CNBC)

News and headlines:

 the Franco/German push for a €500bn recovery fund sponsoring grants for regions hit hardest by the Covid-19 crisis. That looks set to cast a long shadow over European markets for the days to come, although more details, and more analysis, is required. (ITC markets) …. US President Trump’s threat to withdraw funding for the World Health Organization unless it commits to “major substantive improvements in the next 30 days”, The text of the Federal Reserve chairman’s testimony which he will present before the Senate Banking Committee today was released, with little impact on broader markets. (IFR News) …. U.S. businesses are doubling down on China… From Popeyes to Walmart, Tesla to Exxon Mobil, companies are betting that the country’s long-term growth potential still outweighs the mounting case against further expansion — including geopolitical tensions and slowing growth. While the pandemic has spurred businesses to rethink supply chains to reduce dependency on China, companies that are producing in China for Chinese customers are bulking up their local presence, the Wall Street Journal reports. (Pro Farmer) …. Corona virus overwhelming the Brazilian health Care system (WSJ)… Treasury has spent small portion of aid… The Treasury Department has spent only $37.5 billion thus far of a $500 billion pool of funds Congress provided to help struggling businesses, including airlines, during the pandemic, according to a congressional watchdog panel’s report. (WSJ)

Markets:

 Spoos did trade above the all important 2965 level overnight but since failed to maintain gains. A close above this level is all important for the bulls. Currently Spoos down 10 handles, Nasdaq, Stoxx 50 unchanged giving back most overnight gains, Bonds and bunds bouncing a bit after  yesterdays Collapse  and Run up to almost 2 month high in  yields Dollar continues to sag  but still inside a multi week range, we need to see a break out one way another  Yen trading a bit lower as the BOJ called an Emergency meeting for Thursday to discuss some new lending measures. Mnuchin and Powell not expected to cause much of a stir in markets, Tomorrow Treasury Auctions the 20-year bond for the first time in a few decades??  curious to see market reaction and pricing.

Virus news:

BN) Covid Patients Testing Positive After Recovery Aren’t Infectious                                                          
                                                                
Scientists from the Korean Centers for Disease Control and     
Prevention studied 285 Covid-19 survivors who had tested       
positive for the coronavirus after their illness had apparently
resolved, as indicated by a previous negative test result. The 
so-called re-positive patients were not found to have spread any
lingering infection, and virus samples collected from them could
not be grown in culture, indicating the patients were shedding 
non-infectious or dead virus particles.

Yields

Less Fed QE,More Treasury Sales,Higher oil,Higher stocks all equate into lower Treasury prices.Yields coming up near 2 month highs is something to monitor,1.45% ish =2 month yield highs in bonds

10 year yields between .74 to .78% is a cluster of old daily highs yields currently .73%

Charts for Everyone

Boxed beef prices(choice) have peaked(I believe)

Weekly Hog Slaughter appears to have bottomed out as facilities come back on line, possibly bullish for hogs.
Natural Gas Demand spread ( demand minus production) highest in 2 months. EQT says it will curtail Appalachian Gas production until prices rise.
From Mizuho ” daily Tick data had a print of 2049 this mornings on open the highest ever” people in the mood to buy from the Get go.
Moderna has early success in Virus Vaccine trials, stock gaped higher this morning with great volume. This stock movement has a lot to do with today’s risk on Move, A name to watch

Morning 5-18

Buy’em Up Stocks worldwide higher Dax +3%,Cac +2.5%, Italy +1.45%,NKY closed +.5% even though Japan reported back to back negative Quarterly GDP prints, Spoos +2.24%,Nasdaq +1.8%,Russell +4.7%.Optimism that Virus lockdowns are  nearing an end a reason for the strength, from Trading Economics “ California Governor said about 75% of state businesses are open and more parts of New York State are now eligible to lift some restrictions” …. from WSJ “In Texas, gyms and movie theaters are set to reopen on Monday, despite a rise in infections and virus-related deaths there. Idaho on Saturday allowed dine-in restaurants to resume operations under social-distancing rules. New Jersey permitted chartered-boat services and watercraft rentals to resume on Sunday” …….  A piece of Chairman Powell’s interview being flagged as a  reason for some of the Strength as well “Fed chair Powell underscoring that the central bank has “no limit” to what they can do to support the economy and that they remain committed to do so.” (Forex live) …  Moderna says two vaccines are getting positive  testing results through the first  two phases of trials…China oil Demand back to pre-crisis levels Bloomberg reporting that gasoline  demand continues to move higher  CL +9.45% Brent +6%…China Preparing to boost inventories of corn and Soybeans(Pro Farmer)  soy beans +1%  Corn +.6%

U.S. treasury yields Lower ,Bunds steady  but Italian yields Lower by ~7bps, Risk On Move dictating the trade so far today  Silver +4.4%.Gold +.4% Dollar down a bit but it has been stuck in the range of 100.87- 98.81 for almost two months! It needs to pick a direction and go; I believe the best for markets would be a breakout to the downside. Reminder that Fed once again lowered the Weekly amount of QE purchases by $1B slow and steady decrease seems to be working well.Bitcoin traded above 10K over weekend.

The week ahead from pro farmer:

… “President Donald Trump will deliver remarks Tuesday regarding farmers, ranchers and the U.S. food supply chain. He will also hold a Cabinet meeting Tuesday. After Democrats passed its $3 trillion-plus stimulus measure Friday, House Majority Leader Steny Hoyer’s (D-Md.) office told members not to expect votes this week. The House is set to be in session on May 27 and 28. Hoyer said some members may return to Washington this week for committee meetings. Key economic data include Housing Starts Tuesday and Existing Home Sales Thursday, along with another snapshot of initial jobless claims. There are also earnings reports from big retailers, including from Walmart, Home Depot and Target — on the ag/food industry front, Hormel reports Thursday and Deere on Friday. Federal Reserve Chairman Jerome Powell and Treasury Secretary Steven Mnuchin testify before Senate Banking Committee on Tuesday at a hearing on the CARES Act. The Federal Open Market Committee will release the minutes from its monetary policy meeting in late April. On Thursday USDA will release its monthly Cold Storage Report and on Friday it will issue its monthly Cattle on Feed Report.