Notes You Need for May 15: TGT, NAFTA, Mexico election, China economy, 10-year Treasury yields at 3.06%, Korea summit, China Treasury holdings
In my daily trawling through the market I come upon lots of tidbits of knowledge that I think are important to investors but that don’t justify a full post. I’ve decided to start compiling these notes here each day in a kind of running mini blog that I’m calling Notes You Need. Today’s 10:20 post is a representative item: “10:20 a.m.: Target (TGT) has cut its next-day delivery fee nearly in half in one of the most visible efforts to capitalize on Amazon’s (AMZN) decision to raise the price of its annual Prime membership to $119 from $99. Target has dropped the delivery price for household essentials to $2.99 from $4.99 and waived it altogether for customers paying with a Target card. The Target Restock service lets shoppers get 35,000 everyday items like paper towels and baby food for a flat delivery fee. And as Target noted in announcing the cuts, “Membership fee? Nope.” Target has also teamed with Google Home to let customers restock with a voice command using Google’s Alexa.”
China actually seems to be deleveraging
China’s financial system certainly isn’t out of the woods yet, but the country has made substantial progress in moving away from a potential banking crisis, according to the Bank for International Settlements.
China plans for slightly slower growth in 2018
Meeting in Beijing today, the National People’s Congress approved plans laid out by President Xi Jinping and Premier Li Keqiang to set the target for economic growth at 6.5% for the next year and to reduce the government deficit to 2.6% of GDP from the 3% of the last two years.
Possibly meaningless Chinese economic data lead global markets down
Overnight numbers showed that China’s purchasing managers index for manufacturing fell to 50.3 in February. That was down from 51.3 in January. Economists surveyed by Bloomberg had expected a reading of 51.1 in the index. The services PMI declined to 54.4 for the month from 55.3 in January. Easy to understand why these index figures would make markets nervous. 50.3 is way too close to the level that signals contraction in this index
Notes You Need for January 17: China data, casino REITs, natural gas, target price increase for homebuilders, Bitcoin, MRK, U.S. dollar,
In my daily trawling through the market I come upon lots of tidbits of knowledge that I think are important to investors but that don’t justify a full post. I’ve decided to start compiling these notes here each day in a kind of running mini blog that I’m calling Notes You Need. A typical items resembles this from today: “4:20 p.m.: The U.S. Dollar Index gave up a morning gain to fall back to 90.32 before rallying again to close at 90.736, up 0.34 on the day. Some analysts think that the 90 level on the index might give support to the U.S. currency against other major currencies. Others think the dollar is on the verge of falling to a new thee-year low that could open the way to further declines.”
Trick or trend: Emerging markets recover on China news
For a couple of days this week it looked like emerging market stocks were about to either follow U.S. momentum stocks lower or take over downside leadership from a recovering U.S. market. Thanks to strong economic numbers from China today that looks much less likely. In November China’s exports jumped by a year over year 12.3%, according to the General Administration of Customs. That’s up from a 6.8% year over year growth rate in October. China’s imports surged by a year over year 17.7% in November.
China’s stocks fall on fears that government won’t intervene as vigorously now that the 19th Party Congress is over
Over night Chinese stocks fell the most since early August. Sovereign bonds led the way lower, extending a monthlong retreat on fears that the government will step up efforts to reduce leverage in the financial system. The Shanghai Composite was down by as much as 1.7% on Monday before closing down 0.77%. The ChiNext index of smaller stocks closed off 2.12%. Bond prices fell.
With Xi Jinping even more firmly in control, China drops its long-term growth target
Before the recently concluded 19th Congress of the Chinese Communist Party, President Xi Jinping had repeatedly stressed his goal of doubling China’s real GDP from its 2010 level by 2020. The goal was absent from Xi’s three-hour speech at the opening of the meeting.
Weaker than expected expansion in China’s economy–problem seems to be in private sector
The Caixin Service Sector Purchasing Managers Index fell to 50.6 in September. That’s the lowest level since December 2015 and 2.1 points below the August survey. In this index anything above 50 indicates that the economy or the sector is expanding so September’s survey still points to expansion in China’s economy.
Latest data say China’s economy slowed in July
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Notes You Need for June 30: China PMI, euro, dollar, GE, BHI, batteries, TSLA, MON
To subscribe to JAM you need to fill in some details below including, ahem, some info on how you'll pay us. A subscription is $199 (although if you're subscribing with one of our special offers it will be lower) for a year for ongoing and continuing access to the...Jim’s Stock Alerts
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