evening wrap
market vibes
April 29…)
“There comes a time in every man's life, and I've had plenty of them.” Casey Stengel
Stock indexes crept higher bit by bit on moderate volume and closed on the highs on Tuesday. However, ranges are a tenth of what they were 3 weeks ago. Did I say we’d miss them? You bet I did. Trading is like squeezing a dry lemon lately.
The Dow (chart below) is obviously less attractive than tech this earnings season. If you’re the adventurous type, META and MSFT report after the close tomorrow. They’re both cheap but cheap for a reason. More that in the vibe.
In oil today, June WTI closed on the lows. June was the weakest month front to back which is typical negative development.
Dec Red Dec closed at -1.14 contango, the lowest close for Dec 25/Dec 26 since October 2020. The back end is becoming a burden for the front.
Energy Secretary Chris Wright said the administration is working to refill America's Strategic Petroleum Reserve. The Biden administration has been refilling the SPR since 2022, adding 59 million barrels at an average price of $76/barrel (as of December 2024) or at the rate of approximately 3 million barrels a month.
If Wright wanted to, he could add 9 million a month or 300k a day; a nice little bone to throw MBS for helping out with the Mullahs…
Bonds continued to go up on light volume and utterly flat open interest but there is a nice 4 day up auction of higher highs and higherlows. Billy: “Do we care how he gets on base?” Peter: “We do not.”
In other markets, gold stayed close to its POC and settled ca $3330. Silver stayed in its range and settled $33.20ish. Platinum and copper were quiet and rangebound. Bitcoin held its gains, posting the smallest range in many months, which is fine. If the world is quiet, it’s ok for Bitcoin to be quiet, too.
my vibe
The Meta trial is important. Trump and Bessent are openly anti-monopoly. Karoline Leavitt roasted Amazon alive at a press briefing for planning to post tariff differentials on Prime. “This is a hostile act,” she said as she held up a testimonial document. “AMZN and China are partners in business.” Later in the day, An Amazon spokesperson said it would not display tariff costs next to product prices on its website and emphasized the idea was only briefly considered.
There are going to be more META-type anti-trust trials, in my opinion. Pick a sector: industrial ags, finance and banking, especially technology. If I worked on Wall Street and I were a good contingency planner ala Mr. Blankfein… I’d be dreaming of spin-offs instead of mergers for a few years. And it’s only been 100 days.
Bessent was at the same press conference with Leavitt and said he expected 15 trade deals with A-list countries to close within weeks. This is very bullish for stocks, but it’s very dangerous to buy S&Ps and NDX because those indexes are dominated by monopolies. Bondi is going to sue them all, I think, which is not bullish.
Bessent added, “China has been sidelined.” Ronnie would have been proud.
Night all…Good luck in Asia.
JJ
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Charts and data CQG and Bloomberg
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Note that Wright said in a recent interview (if I can find it I would have attached it) that Biden drew down the SPR so fast is damaged some of the infrastructure, which could slow the re-filling process. Not hard to believe...I visited the SPR facilities over 20 years ago and they looked like they were at least 20 years behind on maintenance spending. Just a thought.