Futures vs FV: SP -24.03; DJ -241.24; NASDAQ -115.12
Of course futures are lower on the AAPL revenue warning but they are well off the lows hit 3 hours back. APPL and its satellite companies (SWKS, QRVO, AVGO, QCOM, LITE, etc.) are down but others are holding their own, kind of.
Will the rest of the market be bought off an opening selloff a la WED? The losses today are less than WED morning. Will AAPL be bought? Warnings are bad news. Cramer says worst case AAPL is a buy at 120 because he says it is a consumer products company. DELL was a consumer products company, but when its revenues peaked, its price run was done. AAPL's problems started before its claim China was hurting it. Dan Niles made good points as to how will AAPL keep selling $1K phones in China where the average income is $10K, or India where the average income is less than that. I talked about AAPL hitting its limit when it launched the 8 just two months before the X. That is playing out it would appear and it makes sense because it is math: there is not enough income to buy its $1K phones in the countries it says it has to expand and sell in to keep its margins. Demographics aka math is, like gravity, a b**ch.
In any event, GS says AAPL will have to cut guidance more. Cramer says the communists don't like AAPL. Of course not: it is a free enterprise success, not an inferior state-run entity.
Jobless claims: +10K to 231K. They continue rising and construction jobs are one of the areas being hit.
ADP: +271K jobs, a 2 year high. Where did that come from?
M&A: BMY buying CELG
MTG Apps: -10% to end 2018
Fed: Kaplan says the Fed should wait "a couple of quarters" before thinking of hiking again. That is good counsel, but what that will show is the Fed went too far and the economy is contracting. That is too late to solve the problem of recession the Fed caused. Always, always, always behind the curve. Always. What an utter joke of an instiution, one we allow to set our level of wealth. How long will a purportedly free enterprise, indiviual-based country allow an unelected group of elites to control their wealth and retirements? Wake up investors.
Bonds: 2.650% vs 2.643% 10 year
EUR/USD: 1.1356 vs 1.1344
USD/JPY: 107.75 vs 108.99. Dollar is in a straight dive. Heading toward 100 yen?
Oil: 47.31, +0.77
Gold: 1289.00, +4.90
Futures continue their steady improvement off the 'oh no its AAPL' panic that gripped markets last night. As noted above, the question is whether investors view this as an opportunity to buy, even APPL. I think it might be just that, whether it is warranted or not.
Jon Johnson, Chief Market Strategist
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