Author: BlackMask Financial

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US service sector activity expands at record pace in April

Activity in the service sector in the United States expanded at a record pace in April, according to the latest release from IHS Markit published on Wednesday.

The seasonally adjusted final IHS Markit US Services PMI Business Activity Index was reported at 64.7 in April, up from the 60.4 registered in March and above the previously announced flash estimated.

Commenting on the latest survey results, Chief Business Economist at IHS Markit Chris Williamson said that vaccine rollouts coupled with accommodative monetary policy and fiscal stimulus have led to the “strongest surge in demand seen for at least a decade.” However, the biggest threat to the outlook remain new strains of the coronavirus which could hinder growth “for some time to come,” according to Williamson.

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Fed’s Williams: US GDP to grow 7% in 2021

US To Grow 7% This Year, Fastest Since 1980s: Fed’s Williams

The US economy is likely to expand by seven percent this year as it bounces back from the Covid-19 pandemic, its fastest rate since the early 1980s, a top Federal Reserve official said on Monday. However, the world’s largest economy still “has a long way to go” and needs to see several months of strong employment growth to achieve a full recovery, said John Williams, president of the Fed’s New York branch. Williams also joined Fed Chair Jerome Powell’s efforts to fend off concerns about rising prices leading to an inflationary spiral, and cautioned against reading too much into short-term data. He said he expects to see “real GDP increasing around seven percent this year,” calling it “welcome progress after the toughest period for the economy in living memory.” “While I am optimistic that the economy is now headed in the right direction, we still have a long way to go to achieve a robust and full economic recovery,” Williams said in a speech to be delivered to the Women in Housing and Finance annual conference, noting stronger employment growth would be needed to make the bounceback complete. He credited the Fed’s stimulative policies, including interest rates near zero, with having “positive effects” on the economy, enabling Americans to purchase homes and big-ticket goods. “In fact, with accommodative financial conditions, strong fiscal support and widespread vaccinations, I expect that the rate of economic growth this year will be the fastest that we’ve experienced since the early 1980s,” he said. Rising energy prices and the rebound from the pandemic downturn are pushing prices higher, but “it’s important not to overreact to this volatility in prices resulting from the unique circumstances of the pandemic,” Williams said. He projected inflation will fall back to the central bank’s two percent target in 2022 “once the price reversals and short-run imbalances from the economy reopening have played out.” Powell last week made the same point as he tried again to quell rising concern among investors and some economists, saying there is a difference between “one-time price increases” and a persistent rise in inflation. In a speech Monday, Powell also noted that the US economic outlook had “clearly brightened” but cautioned that “we’re not out of the woods yet.” He stressed that the pain of the economic crisis has hurt lower income workers most, and Black and Hispanic workers suffered larger job losses. “The Fed is focused on these long-standing disparities because they weigh on the productive capacity of our economy,” Powell said in a speech to a community development group. “We will only reach our full potential when everyone can contribute to, and share in, the benefits of prosperity.” Williams noted that the economy added 900,000 jobs in March, and said, “I am hopeful that we will see very strong job gains over coming months as the economy continues to reopen.” The Labor Department is due to release the jobs report for April on Friday, and the median forecast is for the United States to add one million jobs. “But, even with the gains that have occurred, let’s not forget that there are about eight and a half million fewer jobs today than before the pandemic,” Williams said. Meanwhile, conditions so far are not enough for the Fed to alter policy, he said, echoing the decision of the central bank’s policy-setting Federal Open Markets Committee last week. Nick Note: This is the START of the greatest recovery ever!

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US and European stocks reverse losses as Yellen signals inflation won’t hurt recovery and commodities rally

  • US and European stocks recovered on Tuesday after a switch in Janet Yellen’s tone.
  • She assured markets a rate hike is neither something she was predicting nor recommending.
  • Surging commodity prices pushed UK mining stocks higher, lifted by recovery sentiment.

US stocks rose slightly on Wednesday after Treasury Secretary Janet Yellen said she doesn’t expect inflation to be a problem, underplaying previous comments that it may be necessary to raise interest rates to prevent economic overheating. Futures on the Dow Jones, S&P 500, and Nasdaq rose 0.3%, suggesting a higher start to trading at the market open. Yellen’s remarks the previous day were likely about longer-term rates, rather than breaking historic convention and commenting on monetary policy, Deutsche Bank strategists said. She also seemed to project the Fed has the necessary tools to address inflation if it were to occur. But her initial comments prompted a sell-off in tech shares and sent longer-dated Treasury yields higher.”So it seems like a small matter-of-fact statement has been magnified around financial markets, which just shows how sensitive we all are to rates and inflation,” Deutsche’s strategists said. A decline in large-cap Wall Street tech darlings led the Nasdaq 1.6% lower at Tuesday’s close as investors dumped their shares on concerns of rising interest rates. With the S&P 500 around 1% away from record highs, UBS Global Wealth Management says plenty of good news is priced into the market, suggesting stocks are potentially vulnerable to disappointments.

Chief investment officer Mark Haefele said such worries can continue to be seen as a source of volatility rather than developments that are likely to end the equity rally.

“Investors can brace for future bouts of volatility through diversification, and use market swings as an opportunity to build long-term exposure,” he said “We believe the backdrop of accelerating growth and continuing policy support means that markets can advance further.” Investors in Europe initially took their cue from the weakness across the US market, but those losses reversed with another busy start to corporate earnings and a burst higher in the commodities complex. Results from car manufacturer Stellantis, insulin-maker Novo Nordisk, and Danish shipping company AP Moller-Maersk are due. Surging commodity prices pushed up mining stocks in the region, as recovery sentiment lifted. UK mining stocks including Rio Tinto, BHP, and Anglo American each rose about 2% alongside copper prices rising past $10,000 a tonne for the first time in years. London’s FTSE 100 rose 1%, the Euro Stoxx 50 rose 1.3%, and Frankfurt’s DAX gained 1.4%. Asian shares were largely muted as markets in China, Japan, and South Korea are still closed for public holidays. Hong Kong’s Hang Seng fell 0.5%, led by weakness in the tech sector. Oil prices climbed against the backdrop of easing lockdowns in the US and Europe. Brent crude futures rose 3%, to $69.70 per barrel, and West Texas Intermediate rose 1.1%, to $66.45 per barrel. Nick Note: screw these silly asshole. They cannot get into their pea brains how big these recovery WILL BE. Thats good more money for you and me,,,,,

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Despite Despite the sell-off, the markets are poised for new highs by summer

NB: Watch and learn. Theoretically the market should be a 50/50 propitiation. You make a trade to the upside or the downside. Their is no other possible outcome. The market either goes up or it goes down. So that begs the question is why do 80% of the people who trade are losers. And why is it its the same group of winners? The answer is so simple it makes you want to cry. Its the swings the market does not go straight up or straight down. And you are not going to be to successful trade the swings. To make money you have to understand in the course of a trade bases your OTE you will be making and losing money. You need to have enough of a cushion to survive the swings. As you are seeing we do a pretty good job of anticipating the swings and you need to adjust your positions so you can stand those swings. We anticipated yesterdays plunge and asked you to increase your cushion. We anticipated by whatever excuse the market would use a test the 100 day moving average line. I know its hell watching paper profits disappear but that is the game. You have to hold through the swings, Its impossible to trade them. If you push through and our fundamental analysis is right you should make money. And as we both know our analysis has been spot in. Bottom line yesterday was a speed bump and our analysis convinces us that new record highs in stocks will soon happen….

 

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Fed has “powerful tools” in case of high inflation – Kashkari

Neel Kashkari  head of the Federal Reserve Bank in Minneapolis puts out fire Janet Yellen started
  •  says Fed doesn’t want to cut off recovery prematurely
  • says if raise taxes to pay for new spending, that won’t be inflationary
  • not concerned that fiscal packages so far will create inflation
  • once the labour market is recovered, inflation back to target, will normalize monetary policy
  • full employment may take a few years

The president of the Federal Reserve Bank of Minneapolis, Neel Kashkari,said that the bank has “powerful tools” to push inflation down in case it surprises higher. Kashkari says he is not indicating hikes any time soon.  He told CNN that the bank will normalize its monetary policy once the labour market is recovered, adding that the Fed doesn’t want to cut off recovery prematurely which is in line with the bank’s goal to, not only restart the economy but also avoid the virus flaring back up and potentially taking back all the progress that was made. With the rescue packages approved by global economies and the pent-up consumer demand, which is expected to drive prices up, worries remain that the lack of policy adjustments could lead to halting the overall economic recovery from the health crisis. Nick Note: the fire storm MSSS Idiot started yesterday in the stock market will be quickly reversed…. Of course we saw this mini correction coming and so stated. AND WE HAD YOU PREPARED!  NEWS FLASH!!! NO MARKET GOES STRAIGHT UP NOR STRAIGHT DOWN. You have to be able to withstand the market swings against your positions

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T-Mobile’s Q1 revenue jumps 78% to $19.76B

American wireless network operator T-Mobile US, Inc. beat analyst expectations on Tuesday with the company’s first-quarter results, having reported its revenue jumped 78% on the year to $19.76 billion. Meanwhile, the company unveiled earnings per share of $0.74 during the same three-month period, down from the $1.10 reported in the first quarter of 2020. Net customer additions were reported at 1.4 million increasing T-Mobile’s total customer count to a record-high of 103.4 million. “We just keep pushing further ahead of the competition. Our network leadership is fueling customer momentum, delivering merger synergies and expanding our addressable markets for growth. We have so much confidence that we are raising 2021 guidance just one quarter into the year,” the company’s CEO Mike Sievert said. T-Mobile jumped 2.35% to $131.50 per share in after-hours trading following the update. Nick Note: Astonishing profits……..

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Yellen backing up she now says: Not predicting or recommending rates increase

US Treasury Secretary Janet Yellen at the WSJ CEO Council NOW says that she’s not predicting or recommending rates increase.

Clarifying her earlier comments, Yellen stated that she doesn’t “recommend nor predict” interest rate increases and that while she believes that “inflation will not be a problem” there are tools available, primarily by the Federal Reserve, to help mitigate any potential fallout. She also asserted that due to “structural reasons” interest rates will remain low in the future.  She doesn’t see the rescue package overheating the economy. Nick Note: What a fuck up. I guarantee you her cell phone lit up after her earlier prediction of rising interest rates. She roiled the markets….. Now its full ahead reverse and damage control. That is why the DOW went for a 300 point loss to close 20 points higher. Good thing we increased our cushion. Now this  has given us some bargains we can buy as the NASDAQ not only rallies but goes to new higher in fact much higher new record highs…..

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Yellen says interest rates may have to rise ‘somewhat’ to keep economy from overheating

https://youtu.be/3uj_3K3EaIE

Treasury Secretary Janet Yellen said interest rates may have to increase somewhat in order to keep the U.S. economy from overheating. In an interview with the Atlantic that was recorded Monday and aired Tuesday, the Treasury chief said, “It may be that interest rates will have to rise somewhat to make sure that our economy doesn’t overheat, even though the additional spending is relatively small relative to the size of the economy.” Yellen was discussing the Biden administration’s $2.3 trillion infrastructure proposal and its $1.8 trillion American Families Plan. She acknowledged that those proposals have “high price tags,” but stressed that they are long-term programs. If approved by Congress, those plans would come on top of the $1.9 trillion COVID relief bill President Joe Biden signed in March. On Monday, Senate Republican Leader Mitch McConnell said Democrats should expect “zero” support from his party for Biden’s new big-ticket infrastructure and social spending proposals. Biden’s party faces a variety of choices on how to proceed, including whether to use a process called budget reconciliation, which would allow Democrats to pass a bill without GOP votes in the Senate. On Sunday, Yellen said that Biden’s proposed spending on infrastructure and families would not fuel inflation, because the planswould be phased in gradually over 10 years. Last week, the Federal Reserve after its latest meeting stuck to its strategy of helping the U.S. economy with ultra-low interest rates even as it saw broad signs of faster growth. The central bank held a key short-term interest rate near zero and maintained monthly purchases of $120 billion in Treasury and mortgage-backed bonds. Nick Note: What a fucking idiot. One day she says interest rates will not go up. The next she says they will. Fortunately her opinion in this matter does not count. Powell the chairman of the Federal Reserve Board say interest rates will not be going up any time soon if at all. The Fed will NOT NOT NOT be raising rates.And will not be needing to. This is a reflation,,,,, It is settled business.

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Pfizer’s revenue jumps 45% to $14.6B in Q1

The company said its vaccine generated $3.5 billion in revenue in the first three months of this year.

Last year, racing to develop a vaccine in record time, Pfizer made a big decision: Unlike several rival manufacturers, which vowed to forgo profits on their shots during the Covid-19 pandemic, Pfizer planned to profit on its vaccine. On Tuesday, the company announced just how much money the shot is generating. The vaccine brought in $3.5 billion in revenue in the first three months of this year, nearly a quarter of its total revenue, Pfizer reported. The vaccine was, far and away, Pfizer’s biggest source of revenue. The company did not disclose the profits it derived from the vaccine, but it reiterated its previous prediction that its profit margins on the vaccine would be in the high 20 percent range. That would translate into roughly $900 million in pretax vaccine profits in the first quarter. Pfizer has been widely credited with developing an unproven technology that has saved an untold number of lives. But the company’s vaccine is disproportionately reaching the world’s rich — an outcome, so far at least, at odds with its chief executive’s pledge to ensure that poorer countries “have the same access as the rest of the world” to a vaccine that is highly effective at preventing Covid-19. As of mid-April, wealthy countries had secured more than 87 percent of the more than 700 million doses of Covid-19 vaccines dispensed worldwide, while poor countries had received only 0.2 percent, according to the World Health Organization. In wealthy countries, roughly one in four people has received a vaccine. In poor countries, the figure is one in 500. Pfizer has said it is committed to making its vaccine accessible globally. It announced on Tuesday that it had shipped 430 million doses to 91 countries or territories. A Pfizer spokeswoman, Sharon Castillo, would not say how many of those doses have gone to poor countries, where Pfizer has said it is not profiting on vaccine sales. The World Health Organization figures make clear that Pfizer has provided minimal help to the world’s poorest countries. The company pledged to contribute up to 40 million doses to Covax, a multilateral partnership aimed at supplying vaccines to poor countries. That represents less than 2 percent of the 2.5 billion doses that Pfizer and its development partner, BioNTech, aim to produce this year. The doses that Pfizer pledged to Covax are “a drop in the ocean,” said Clare Wenham, a health policy expert at the London School of Economics. Johnson & Johnson and AstraZeneca both vowed to sell their vaccines on a nonprofit basis during the pandemic. Moderna, which has never made a profit and has no other products on the market, decided to sell its vaccine at a profit. Unlike Moderna’s vaccine, Pfizer’s shot is not crucial to the company’s bottom line. Last year, Pfizer earned $9.6 billion in profits, before the Covid vaccine had any discernible impact on its results.

Pfizer frequently points out that it opted not to take federal funds proffered by the Trump administration under Operation Warp Speed, the initiative that promoted the rapid development of Covid-19 vaccines.

But BioNTech received substantial support from the German government in developing their joint vaccine. And taxpayer-funded research aided both companies: The National Institutes of Health patented technology that helped make so-called messenger RNA vaccines possible. BioNTech has a licensing agreement with the N.I.H., and Pfizer is piggybacking on that license.

 

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Cummins raises 2021 revenue target on strong vehicle demand

https://youtu.be/FNfiEXO47m0

Reuters) -Strong commercial vehicle demand propelled U.S. truck engine maker Cummins Inc (NYSE:CMI) to raise its full-year revenue forecast, following economic recovery from easing pandemic-related border restrictions on goods movement. Cummins, which focuses on heavy-duty trucks, is expected to benefit from U.S. President Joe Biden’s massive $2 trillion infrastructure plan that includes building and repairing roads, bridges, mass transit, schools and other infrastructure. Chief Executive Officer Tom Linebarger, however, says “the shortage of key components such as semiconductor chips has been the primary challenge with adverse weather conditions impacting the United States, and bottlenecks in global logistics further adding to order backlogs”.

Cummins now expects 2021 revenue to be up between 20% and 24%, from its previous forecast of 8% to 12%.

Net income attributable to Cummins was $603 million, or $4.07 per share, in the first quarter ended April 4, compared with $511 million, or $3.41 per share, a year earlier. Sales in the engine business rose 14% to $2.46 billion, while net sales rose 21.5% to $6.09 billion. Nick Note: I am seeing more and more companies up their earnings estimates….