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2017 EXCERPTS FROM PRIOR WEEKS BELOW:    
December 18—22, 2017  CONGRESS VOTES ON TAX PLAN    It would be (almost) funny if Congress voted to pass the Trump Tax Cuts and split from town before passing a new Continuing Resolution, to fund the US Federal Government, past Friday’s expiring CR. That’s right—The US Government is only funded through Friday, at midnight. And we all know Congress is as eager as any working stiff to get out of town to start its Christmas holiday. And that makes the coming week a really BIG week following what’s already been a big weekend.

E. Hunter Harrison, CEO of CSX, out on medical leave, it was announced, last Friday, died Saturday, probably restraining the stock from much of a rebound. Add to that Atlanta airport shut down on a busy pre-holiday weekend, and the Transports will struggle to start, Monday. Also losing its CEO, M&T Bank's (MTB). It’s chairman and CEO, Robert Wilmers, died on Saturday night at home. He led the Buffalo based bank for nearly 35 years. Wilmers, 83, was succeeded by Robert Brady, the bank's lead outside director who assumed the position of non-executive chairman, according to a statement from the bank Sunday.

Then, the week may hold another Deal Monday, with the rumored TPG, & Welsh, Carson Anderson, & Stowe take over of Kindred Healthcare’s (KND) long-term acute-care facilities & rehab centers, with Humana (HUM) taking over the rest—mainly homecare & hospice centers. The rumored value of $9 p/KND share isn’t all that far from where it closed Friday, at $8.60, which speaks to KND’s heavy debt.

Walt Disney Co says ‘Star Wars: The Last Jedi’ took in $220m in North American box office, opening weekend, #2 behind, only, its immediate predecessor, ‘Star Wars: The Force Awakens,’ ($248.8m). Disney also says it did similar but slightly better volume overseas, bringing the film’s opening weekend total to $450m. It’s late in the year but not too late for the year’s box office to get off the mat, after a terrible year.

Housing is an active topic this week, the Economic Calendar promising the NAHB Dec Housing Market Index, on Monday, hours after China’s Nov Property & House Prices are released. Tuesday, we’ll get Nov Housing Starts & Building Permits, though the focus may be on Congress, as the tax vote starts, probably in the Senate. Wednesday, the schedule promises Nov Existing Home Sales, along with EIA weekly Petroleum/Gasoline/Distillate status. Thursday, FHFA releases the Oct House Price Index, which may well be influenced by some catch-up after September’s hurricanes. Mortgages aren’t issued if insurance isn’t available, and insurance companies won’t issue policies if a hurricane or tropical storm are forecast. That could have pushed a number of September closings into October, even as the damage caused by the hurricanes could have pushed some to hurry up and buy a replacement abode, in October. Also Thursday, the final government releases the final take on Q3 GDP & Corporate Profits, plus PCE, Yellen’s favorite indicator though no word if her replacement, Jerome Powell, assigns equal credit to that, particular, data point. PCE will pop up again, Friday, as part of October’s Personal Income & Outlays, and, whaddya know? Nov New Home Sales. So, just as Republicans are limiting mortgage interest & real estate tax deductibility to $10K per annum, under the new tax law, the Street will be flooded with all new housing data, none of it as reliable as usual, thanks to Harvey, Irma & Maria.

The Earnings Calendar is slight but not without merit. Emboldened, as always, are those tickers I believe will attract the most attention. Some services show Lennar reporting this week but ignore them. It is going to report on January 10th, not even this year.

Stephens is about the only firm really pressing the flesh as if it was just another week. On Monday it starts a Broadcast TV Plane Trip, which seems propitiously timed, given Disney’s deal for Fox but Stephens has had the event on its calendar for months. On Tuesday, Stephens starts an Auto Investor Field Trip to Dallas, visiting the firms highlighted on the calendar, below. The Street, one can see, has all but wrapped the year. Except Stephens. But it won’t be off to vacation for analysts. On the contrary, as soon as the Republican tax plan is passed, analysts will be falling all over themselves to issue revised earnings estimates for companies whose tax rates will change the most. In fact, some of the biggest beneficiaries may be retailers, who’d be posting losses, if their tax rates didn’t fall. Given that all but regulated industries (Utes) will see their tax rates fall, analysts could be very busy indeed. And don’t forget, Europe starts MiFID next year, which means analysts comments must be purchased, rather than bundled with trading fees. Any analyst who hopes to take one last chance to prove her value will be issuing revised estimates as if the holidays weren’t nearby at all.

And it’s the revised estimates that make it unlikely that traders have bought the rumor will, now, sell the news. On the contrary: The last hurrah for this apparently interminable rally lies ahead, thanks to a lack of sellers, rather than a surfeit of buyers. The new tax scheme is keeping traders from booking profits until this year is over. That could make 2018’s opening weeks look a bit like 2016’s, and that’s what retail traders should worry about most, because they have no access to what the big portfolio managers plan.

A happy & healthy holiday to all. No idea if there’ll be another Outlook next week. Depends on how my week goes and what next week promises.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

December 11—15, 2017  THE BELL RINGS on the 14th   If you think there’s no bell that rings at inflection points, I’d direct you to 12/14. The FOMC decision, updated financial outlooks, and Yellen Press Conference all occur on the 13th. Then, on the 14th, Monetary Policy Committees meet at the Swiss National Bank, Norway's Norges Bank, the ECB & BoE, the latter two scheduled for post-Meeting press conferences that will run into the US pre-open noise on the 14th. None of these banks or their leaders intend to upset the apple cart—none will break from the party line—it’s the best of all worlds, and that provides the reason to gradually return to normalized policy, while continuing to fan the flames of a global economic recovery. Here! Here!

The WSJ has a new theory, that with Jerome Powell soon to replace Janet Yellen, atop the FOMC, economists within the Fed will vie to win Powell’s ear, since he’s a lawyer, not an economist. Does that really sell newspapers?

The Central Bankers from around the world are puzzled that inflation remains in hiding, when it’s obvious to me. The internet has sucked inflation out of global economies. Ask anyone who collects Llardro, stamps, coins, or even cookie jars and they’ll tell you eBay and Amazon have sucked the value out of all of them. A local stamp & coin shop told me to use my 70 & 80 year old postage because it’s not worth anything, these days. Coins? It’s all based on the value of the silver or gold from which they’re pressed. But inflation? Perhaps in some housing markets, now more than ever in places like California, which is literally aflame. Perhaps if the Central Bankers spent more time watching the collapse in prices on the web, the mystery of inflation missing in action will become self evident.

The Insurance Industry chose this week for 2018 Outlooks. Meanwhile, ASH—Society of Hematology continues its meeting Sunday, even as the CBOE kicks off trading in Bitcoin futures, Sunday. Outlook meetings start off with 3M on Tuesday, along with Principal Financial Group, the night Chanukah starts, at sundown. Wednesday, Eli Lilly, Graco Inc, Honeywell, & Rogers Corp host meetings, while Thursday, it’ll be Akamai, Axalta Coating Systems, Danaher, Express Scripts & Prudential Financial meet with analysts. Friday, it’ll be Met Life’s turn, even as Qtrly Options & Futures expire.

Then again, the comments out of the ECB & BoE will hold more sway than Yellen’s, since she’s not only losing the chairmanship but said she’d be resigning from the Board of Governors, letting Powell start anew. You might want to think about selling some winners into the 14th, since volume will get even thinner as the year wears on, and PM’s have no reason to squeeze the last drop out of the ketchup bottle.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

December 04—08, 2017  
ONE MORE WEEK BEFORE NERVES CAUSE SOME SELLING INTO YEAR END   Earnings tail off, we’re between holidays, so the Street cranks up its investment bank conferences on both sides of the Atlantic. The weirdest timing of all, is the Nov. Unemployment Report this Friday, instead of last Friday, the first of the month. Not that it’s going to make a difference, anyway—the Fed is raising rates in mid-December, and it doesn’t appear like anything is going to throw them off that plan. And it’s hard to believe Monetary Policy Meetings in Australia, India, or Canada are going to change the course of US history, this week.

The I-bank conferences likely to deliver the most commentary includes UBS’ 45th Media & Communications Conference, starting Monday, Cowen Energy & Natural Resources, Leerink 8th Annual Devices & DNA bus tour in California, all starting Monday. But if you carefully read down the list of events Monday, you can see how any one or two of them might be worthy of attention.

Tuesday, Goldman Sachs US Financial Services Conference will compete with Wells Fargo’s Pipeline, MLP & Utility Symposium, and Nasdaq’s 37th Annual Investor Conference, the latter in London. Tuesday is flush with I-bank conferences on both sides of the Atlantic, and out to Asia. The wonder is how MiFIID 2 will impact the I-bank conferences on the Continent.

Wednesday’s highlight is Barclays Global TMT, Technology, Media & Telecommunications Conference in San Francisco. Citi’s Global Healthcare comes at the end of a long list of Healthcare conferences, while Mexico’s Auto Industry Summit, in Guanajuato Mexico, showcases the problem Trump’s negotiators will have cutting out the Mexican manufactured parts that US OEMs need to build cars in the US.

As the FANGS were flying, one old line tech company was lumbering, unable to join the party until after its recent earnings report, released 11/15. And in proof of its suddenly filled up dance card, I refer you to
Cisco’s IR page where you’ll find the company planning on participating in:
12/04 Baird & Cisco to Host Tech Talk on Cisco’s Multi-Cloud Strategy
12/05 Nasdaq 37th Investor Program
12/06 Wells Fargo Tech Summit
12/07 Barclays Global Technology, Media & Telecommunications Conference
And farther out, on 12/13: Cowen Security & Networking Conference

On 12/06, the 6th Annual NYC Investor Summit is a self-organized meeting with leaders from AEHR, ACLS, BESI.AS, BRKS, CAMT, COHU, ESIO, FORM, ICHR, IMI, INTT, IVAC, KLIC, NANO, RTEC. Cowen is sponsoring the networking luncheon. Obviously, a group of companies that doesn’t think they get their Street due, without setting up their own IR Meeting, annually.

Ivy Zelman is the headline speaker at HIVE, in Los Angeles, on the 6th. One of the few former Street analysts who retained her influence. She remains the hammer on homebuilders, the subject of a Deutsche Bank Conference in NY, Thursday. Then, Friday, ASH, the Art of Hemotology Symposium opens in Atlanta, surely one of the biggest healthcare events of the 2H.

As for Earnings, Broadcom’s (AVGO) report (Wednesday) may determine how much room it has to increase its bid for Qualcomm—or how much it might need the deal. Otherwise, Toll Bros on Tuesday, and Hovnanian Enterprises, on Wednesday, could be the key reports mid-week. Asena, Monday, is the worst of conglomerate building, being fading retailers like Loft & Ann Taylor, just as shopping moved online. Lululemon has had a strong quarter, here but will have tougher comps in the future to top. Hudson’s Bay, owner of Saks 5th Avenue & Lord & Taylor is another empire builder whose timing stunk but whose assets have real estate value. Thursday, Ciena, Dell Technologies, United Natural Foods, and Vail Resorts all have aspects that tell a story—UNFI, perhaps, how quickly Amazon can chew away at supplier margins, at Whole Foods, its biggest customer now owned by AMZN. Likewise, Dollar General is a retailer I don’t know who can truly cover—since it opens in every kind of marketplace, and sometimes relies on scratch & dent cans of food to fill its registers. With thousands of stores, I don’t know how management can offer guidance, let alone an analyst look from outside and make a different estimate.

For all the events scheduled this week, think of it as a wind down that will begin after one last spurt of meetings, this week.

ECONOMIC:(Highlights, only, below. Full International Economic calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions are the author’s, alone, and should be just one factor in more complete due diligence.

November 27 –December 1st, 2017   
CARRY ON     Nov 28th could be a significant day for markets. the US Treasury, Board of Governors of the Fed Reserve, Fed Reserve Bank of NY, SEC, and CFTC sponsor their 3rd annual conference on the "Evolving Structure of the US Treasury Market: NY Fed’s William Dudley opens the event but, by the end of the day, the following will have spoken: US Treas. Sec’y Steven Mnuchin, SEC Chief Clayton, and CFTC Chair Giancarlo. Also on the 28th, Jerome Powell will be at the US Senate, for a confirmation hearing on his nomination to be Chief of the FOMC, replacing Janet Yellen, Feb 3rd, when her term is up, or sooner, if he’s sworn in earlier. Chicago Fed Reserve hosts its Annual Agriculture Conference in Chicago, also the 28th. Across the Atlantic, the Bk of England will publish results of its Bank Stress Tests, and also publish its Monthly Lending & Money Supply Stats, and its Financial Stability Report, just prior to the US Open. And if all that wasn’t enough for one day, FHFA will release its Sept House Price Index & S&P/CoreLogic Case/Shiller 20-City Price Index will be published, as well. And perhaps in answer to a recent conference that debated the wisdom of aging politicians and judges, the Philadelphia Fed hosts Aging, Cognition & Financial Health: Building a Robust System for Older Americans. Philly Fed Pres Harker will speak on "Financial Safety for the Aging Population." (Yes, many do spell it ageing but the Philly Fed didn’t.) Wondering how that 7-year Note Auction will do, also the 28th? At $28B, it’s not very big. And speaking of Treasuries, anyone else wonder whether the Federal deficit might be helped, longer term, by Treasury offering fewer short-term debt and more long term debt, as rates are rising?

Thursday, into Friday morning, all eyes will be on Vienna Austria, where OPEC & non-OPEC Oil producers meet to discuss more plans to control production, and extend what’s being done, now, through Q1 of 2018.

Friday, we’ll get November Motor Vehicle Sales but for the monthly Unemployment Report, the wait is until December 8th, seasonal hiring and hurricanes putting a question mark above the data, no matter what it reads. And at any rate, it’s not about to sway the FOMC’s intent to raise rates just 5 days after the Nov. Unemployment Report is released. Speaking of which, note all the Central Bank meetings bunched at the middle of the month. I don’t think I’ve ever seen anything quite like it, in my 28 years of following "events."

The Earnings Calendar is dominated by consumer names, and retailers, in particular. For all the dominance and invincibility ascribed to Amazon, it’s curious that Barnes & Noble still exists, and may in fact point the way to a balance that will someday settle the issue of what online sales dominance means to bricks & mortar stores. One thing is for sure, the crowds at the mall (Town Center in Boca Raton FL) for Black Friday was young, and spending. While Mall owners’ Aeropostale has been advertising "50—70% off entire store" for weeks, anyone who ever shopped there knows prices were boosted to allow such steep discounts. On the other hand, chains that worked to hold the line on discounts, like American Eagle Outfitters, finally succumbed to the one enticement that brings in shoppers—a minimum of 40% off across the board. By the time I got to Macy*s, a girl was pushing a cart of 70% and 60% off signs, replaced with 40% and 50% signs for any purchases after 1pm. How much less busy was Macy*s, on Black Friday? There was no wait for the ladies’ room, which is virtually unheard of, any day of the week. AEO reports Tuesday.

The Events Calendar picks up this week, with major I-banks holding the last of their 2017 Conferences, before the holidays interrupt the flow, again, by mid-dish December. Meanwhile, in the background, the Federal Reserve is unwinding its balance sheet, a process that will pick up next year. Meanwhile, it may be spreading out its rate hikes but it is no doubt raising rates fairly regularly, stocks not, yet, acknowledging that process, either. Sooner or later, stocks will have a comeuppance but I doubt if that’s a story that will unfold in the next 2 weeks. Therefore, stock investors need do little but carry on.

ECONOMIC (Economic Highlights, below. Full International Economic Calendar Here )

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

November 20—24, 2017 
PARADE, FOOTBALL, & FOOD   There was a time I’d lead with Black Friday, so named because there was a time that retailers became profitable for the year on the Friday after Thanksgiving—back before eCommerce & year round 40—70% off sales, when many bricks & mortar retailers booked 40% of their annual sales & 70% of profits from Black Friday through January. Now, there’s not a week of the year when 40% off isn’t available at most stores, and people can capitalize on Black Friday deals 24/7 for at least a week, online. There’s not only a dearth of exciting sales to line up for, but a dearth of products worth lining up for. One of the most sought after products will be Apple’s iPhone X, a $10 gift card with purchase at Target, possibly, the best deal available. I don’t really know because I want to be surprised on Thanksgiving Day, when I pour over the circulars while the Macy*s’ 91st Thanksgiving Day parade plays on my TV. Time was, my store on Columbus Ave was the biggest hangout for people who needed a bathroom break or to warm up as the parade balloons were being blown up across the street at the Museum of Natural History. But, then, those were the days when people would line up for hours to buy ski suits and jackets at 20% off. Today, 20% off doesn’t even warrant a pause.

The Economic Calendar is filled with European Central Bankers speaking, along with Janet Yellen at NYU (Tuesday night). But not much to concern investors. The FOMC Oct 31—11/01 Meeting Minutes were never going to rock the world but are even less valuable, now, with Jerome Powell teed up to replace Yellen. Powell’s Senate confirmation hearing, on 11/28, should be equally lacking in suspense. Already approved as a Fed governor, the Senate isn’t about to suddenly reject him as Federal Open Market Committee Chief. There was a time NAR (Realtors) Oct US Existing Home Sales (Tues.) & Oct Durable Goods Orders & Shipments (Wed.) might have drawn special interest but, after Hurricanes Harvey, Irma, & Maria, the question of how much of any strength is the bounce back will linger over housing & durable goods sales. Throw in the half million or more vehicles that need to be replaced after the floods resulting from those storms, and economists will be hard pressed to figure out what the underlying economy looks like, absent the storm-caused replacement cycle. For the record, for those who weren’t impacted and may not remember, Harvey hit mostly in August, Irma & Maria in September.

The Earnings Calendar is another story: Dominated by consumer names, there’s a little something for everyone: Agilent, Hewlett-Packard Enterprise, Intuit, Palo Alo Networks, Analog Devices, Copart, Cracker Barrel Old Country Store & Restaurant, Medtronic, Movado, Lowe’s, Salesforce.com, and Deere provide a fair representation of the range of earnings encompass, this week, even as retailers dominate in numbers. And truth be known, the company that could surprise to the upside, most, might just be Hormel, on Tuesday. You wouldn’t believe how many cans of Spam people buy when they’re facing hurricanes, which forces supermarkets to restock, immediately. Of course, cans of tuna, salmon, and even soup are often reached for but not in the numbers of Spam.

The Events Calendar is all about Europe & Asia, because it’s hard to attract portfolio managers to conferences, into what’s usually a long weekend over Thanksgiving. And the number of PM’s taking off could be especially large, this year, as the major indices have hit record high after record high. I don’t know about you but I am disappointed by the slate of films opening this week. Aside from "The Man Who Invented Christmas," about Charles Dickens’ creating of "A Christmas Carol," I could take or leave every movie opening this week, the Dickens story more an occupational interest, as a fellow writer, rather than a blockbuster movie. And, while US markets will be open Friday, they’ll trade only a partial day, with mostly amateurs and retail investors doing any trading.

So what does that mean for markets? Not much. More of the same, on even lower volume, with some PM’s cleaning up their books for the year, well before year’s end. That also means window dressing, which could bring even worse pain to investors in companies like CenturyLink Communications & AT&T. As for retail, it’s likely it’s approaching a bottom. The ICSC (Int’l Council of Shopping Centers) took out a full page ad in Barron’s, "The TRUTH claiming American consumers log 1.5 billion visits every month to shopping centers," in the same edition that contra-retail ETF’s are being advertised, like ProShares EMTY, "Decline of the Retail Store ETF," more info at proshares.com/retaildecline. Maybe it’s just me but when pros & cons of any sector are being fought in the press, at $70k per page, or some other ridiculously high fee, in something as specialized as Barron’s, I can’t help feeling the bottom may be near. We’re never going back to the days when thousands lined up at Walmart for its Black Friday sale opening, people trampled and occasionally killed as the doors opened. And even as the internet & ecommerce has enabled even the smallest store in the most remote locale to go global, apparel designers, particularly, have be bereft of ideas that interest consumers. That won’t continue forever. At some point a designer will try something new that hits big. Until then, it will be more of the same pain for retailers—and a reason to avoid investing in them, despite the advertising signal given off by ProShares & the ICSC.

Happy holiday, everyone!

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.
 

November 13—17, 2017  CENTRAL BANKERS & RETAILERS WILL DOMINATE THE NEWS    Central Bankers have rarely spoken at so many venues, and even less frequently, jointly, at single events but they willl this week, culminating in a panel that boasts FOMC Chief Yellen, ECB Chief Draghi, BoJ Chief Kuroda, and BoE Chief Carney, at 11am (Frankfurt time) panelists at the ECB's Conference on Central Banlk Communication. They'll all be at different stages of boasting that their central bank medicine is working, Yellen & BoE's Carney likely to espouse the view that their recent rate rises should be followed by more increases.

Meantime, the Earnings Calendar is dominated by Retailers reporting, and they won't put forward the positive spin the central bankers weave. Even with the worst performing department stores out of this week's picture, having reported previously, the schedule dominated by the better performing TJMaxx,  Ross Dress For Less, and Walmart, slow growth remains the watchword, with Target and Walmart spending small fortunes to boost comparable sales into positive territory. It's obvious to us, though not at all within central bank conversation, yet, that the rise in sales on the internet has tremendously reduced inflationary fluctuations and may, in fact, have spelled the end of inflation, altogether. There's no greater price suppression than the "net," which is why the IMF Statistical Forum on Measuring the Digital Economy, includes the  panel, "Could Corrected Measusres of the Digital Economy Help Us Find the Missing Growth?" Yes, I'd answer, along with the reason inflation has been AWOL for so long.

Last week, the wobble we foresaw arrived on schedule. With no big news until the next earnings cycle, unless Congress passes the Republican's Tax Cut measures, stocks are left with a near guaranteed rate hike in December, and end of year, and the selling concurrent with leveling the books before the holidays. All in, upside will be tougher to manage, without positive news on the tax cut front, and that won't be a smooth ride. It's not just that the cuts favor corporations, which most consumers see as the "fat cats," it's the fact that eliminating local and state taxes will cause many in the middle class to pay substantially higher federal taxes under the Republican plan. Furthermore, the whole fight about lower the deductibility of mortgage interest to "only" $500K strikes another blow at people who are shopping for houses that cost substantially less than that--harder as they are to find, now. Expect more distance to be put in below the highs. It's become the November thing, because it didn't happen in September & October, as it usually does.  

ECONOMIC: (Highlights, only, below. Full International Economic Calendar includes links, here)     

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s alone, and should be just one factor in more complete due diligence.

November 06—10, 2017   MARKETS COULD WOBBLE    Because Veteran’s Day falls on a Saturday, there is no bond market closures in observance—something SIFMA took a long time arriving at. This week, the Street sponsors VOWS, a celebration of Vets, with donations of partial commissions, a gala, and hiring but I won’t believe the NYSE gives a damn until it closes on Veterans Day, like the Bond Market does, when it falls during the week, rather than on a weekend, like it will next Saturday.

The large caps have been making new highs, even as the Russell 2000 has lagged. Makes sense: Small caps rarely make enough profits, while they remain small, for lower tax rates to impact their results. As their sales grow, their market caps get bigger, as do their profits, making lower rates more meaningful, later. And there have got to be a lot of fiscal conservatives wondering how the heck increasing the US debt by $1.5 Trillion dollars is good for the economy. The tax plan is one sausage that’s likely to look ugly while it’s being made.

The most interesting event of the week, in my mind, is the first speech by newly confirmed Fed Governor Randall Quarles, at The Clearing House Conference in NY, this week. The Bank of Japan’s chief, Kuroda, is everywhere this week, even as the BoJ’s minutes (summary of opinions) will be released overnight, Tuesday. Note, also, Treasury Sec’y Mnuchin is speaking this week, also, at the Economic Club of New York luncheon on Thursday. No doubt he’ll tout the tax bill as the second coming.

Earnings transition to consumer names, including Kohl’s, Macy*s, and Nordstrom report Thursday, & JC Penney Friday. I read an article whose premise was that Amazon could move from lockers at Kohl’s to buying Kohl’s which strikes me as ridiculous. Amazon doesn’t strike me as a company that wants to be saddled with thousands of large, cavernous retailers. Something more digestible like Dillard’s, maybe but not KSS. Dillard’s also reports this week and, no doubt, the controlling shareholders might look favorably on a exit from retail. It’s one of the most forgotten retailers in the country, reporting Wednesday. Monday, Michael Kors reports, as well as CVS Caremark which might not respond to questions about a bid for Aetna. While "selective leaks" are violations of security laws, it appears that either Reuters, The Wall Street Journal, or the Washington Post & San Hose Mercury News rarely blow smoke where there isn’t a fire. Tapestry, the former Coach, reports Tuesday, along with Marriott Hotels & Resorts, Royal Caribbean Cruise Lines, Take Two Interactive, Hain Celestial, Pilgrim’s Pride, and William Ackman nemesis, Valeant Pharmaceuticals. For the record, Humana reports Wednesday, Tenet Healthcare Monday. Even with the big department stores reporting Thursday, nVidia & Disney may get most of the press.

The Event Calendar gets interesting this week, with the National Ass’n of Realtors (NAR) meeting, the Edison Electric Institute (EEI) hosting its Financial Conference, which is one mass analyst meeting for Utilities analysts. In fact, Citi, Wolfe Research and others will host clients at the event, just days after Vistra announced a bid for Dynergy. If you happen to believe the discounters like TJMaxx & Ross Stores Dress for Less can escape the scourge of the internet, you might want to listen for comments out of RVCF, the Retail Value Chain Federation, hosting its fall conference in Phoenix, through the 8th. .I don’t think It’s the internet, or Amazon that’s responsible for all that’s wrong with retail. Instead, I believe the buyers have terrible taste, and are getting no help from "designers" who seem to be sticking to the "safe" side, rather than stage a revolution. As a former Retailer, I can say without equivocation that there’s not a garment in any store that I yearn for, and that’s most unusual because I’ve felt that way for almost 3 years, already. Haven’t bought a pair of shoes, sweater, dress, or anything else for 3 years, except an American Apparel tie-dye shift for $7.50, at its going out of business sale, and an Escada shirt whose color was irresistible. Unfortunately, now that it’s in my closet, I’m not sure what to pair it with because it has pointed lapels that drop inches below the waist and below the hem of the shirt, which is a gimmick I wish I’d noticed sooner—like before I bought it.

Just about every store in the mall offered 40% off, except for those touting 50—70% off (those property owners who bought and kept open some Aeropostale stores must be wondering what it’ll take to get someone into their stores). The most exciting thing I’ve seen in months is a product Bath & Body Works & White Barn refer to as bath "Fizzies," new to LB’s stores, but which I’ve known as bath bombs for at least 2 years before LB got hip to the fad and started selling them. (Best I can ascertain is that LUSH was first to offer them, about 3 years ago. And though, at best, you can cut one in half to get 2 tubs out of one bath bomb ball, they’ve been $7 each, everywhere, until LB broke price this week. Someone ought to investigate the collusion required to cause so many stores to price them at $7 each, as I await the next retailer to scoop LB but offering them for even less. It wasn’t long after LUSH introduced bath bombs that 2 kiosks popped up at the mall, last holiday season, selling them in all kinds of neat shapes like candy bars, icicles, pets, etc, the smell often matching the food or animal the bombs were shaped like. So here’s a scoop for dads with preteen and teen girls—get them a couple of bath bombs or "fizzies" and everyone will be both clean and happy.

SO, with retailers starting to report in mass, and restaurant chains like Wendy’s & DinEquity reporting, too, on top of Congress getting down to the nitty gritty of marking up the tax cut bill, I feel confident that daily new highs will give way to more wobbles. I-Bank conferences start to return, even though many are still concentrating on AsiaPac, instead of US. Credit Suisse’s Healthcare Conference is usually a notable event, while JPMorgan’s Global Oil & Gas Conference in London, could just as well be in Houston, because it is a global event. Tuesday appears to be a big day for I-bank conferences, though Deutsche Bank’s Gaming, Lodging & Leisure, starting Wednesday, could be one of the most optimistic event—which seems odd to say so soon after a mass murder incident happened in Las Vegas, the gambling capital of the US. ARDA, Resort Development, could well be an equally happy affair, based on the charts of Marriott, Hyatt, and other hoteliers.

Note, I’m not predicting a bout of selling, though there are some who will sell before mid-December, to take the rest of the year off. Instead, I think stocks will wobble and meander around, keeping one eye on Washington, the other on the local mall. Let it be said, that an entire generation grew up with parents being laid off, knowing someone who lost their house to foreclosure, and understood what their parents really wanted more than most other stuff was a huge SUV, perhaps with spinning wheels, and the baddest phone they could lay their hands on—be it Samsung or an iPhone. There’s a generation of kids who grew up with parents who actually said, "We really can’t afford that. Are you sure you absolutely need that?" And parents who may not get the concept of the best jeans being ripped to shreds before their kid ever even tries them on. What’s wrong with the mall is what’s wrong with department stores, from the get go—shoppers want to shop at stores that have a vision with which they can identify. Spending $240 on shredded jeans doesn’t make a lot of sense to anyone who isn’t Kim Kardashian. Don’t panic when stocks wobble—but that doesn’t mean be first to scoop of shares if something deeper occurs

ECONOMIC: (Highlights, only, below. Full International Economic Calendar is here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in complete due diligence.

October 30—November 3, 2017   BIGGEST WEEK FOR EARNINGS and an FOMC MEETING STATEMENT     If there ever was an FOMC meeting for which there is no anticipation or anxiety, the one upcoming would be it. And worse, the FOMC statement will be followed, rather quickly, by Trump’s pick for Yellen’s replacement. I give little credence to those who say Trump may reappoint Yellen, as many presidents have done to sitting chairs, even when they were from a different party than the president but Trump is not a conformist, so surely thinks he must put his own mark on the FOMC—in addition to the 4 vacancies he’ll be filling, one already approved: Randall Quarles. And he was quoted as saying he wanted to put his mark on the position.—just as he wants to do with everything else. So Trump’s announcement, and Friday’s October Jobs report will be the big events of the week. Given automakers have just announced their Q3 earnings, there are few surprises to anticipate out of the October Vehicle Sales data, as well. And anyway, the problem with all the data coming will be the asterisk for hurricane disruption that will appear beside every number released. Monetary Policy Committee decisions from the Bk of Japan & the Bk of England may not be more interesting than the FOMC decision though, clearly, the BoE is maneuvering towards a pullback in its easy ways. On Thursday, the 9 retailer who still divulge their monthly sales (COST, ZUMZ, FRED, & LB most prominently) will be out with October sales, even as a retailer or two will offer up preliminary quarterly sales, as JCPenney did last week.

The ARRC Roundtable (11/02) has already recommended to the FSOC (Financial Stability Oversight Council) that LIBOR be dropped in favor of the "Secured Overnight Financing Rate (SOFR)" in response to recent rigging of LIBOR & the UK Financial Conduct Authority’s CEO Andrew Bailey’s speech on the risks around LIBOR, and they may impact not only the interest rate derivatives market but, also, a wide range of financial products which use LIBOR in setting their rates—including US HELOCs (Home Equity Lines of Credit). Now, all they need is to identify a transitional rate upon which LIBOR can be dropped and moved to SOFR, to "support financial stability in the United States. This group has been meeting since 2014, and it doesn’t appear their resolution is any closer to adoption than it was 3 years ago. After some end of month maneuvers —possibly selling, to book profits, there’s little reason to expect the bulls to suddenly vanish. Even if you know this, too, shall end badly, it doesn’t mean it’s time to sell right now.

Anyone who said the Earnings Calendar peaked with the most reports, last week, doesn’t know what they’re talking about. The peak in number of reports is this week, even if none have the power to take down a index or sector, except Facebook & Apple, reporting Wednesday & Thursday respectively. I’ll say this about Apple: It’s mall based store hasn’t been busier since last Valentine’s Day (02/14), and that applies to the shopping bag count coming out of its store, as well. And that’s before the X is available to even see, which will occur on Friday, when it starts shipping. So there’s the rub: Amazon can put on 125 bucks to an already dizzying high price after earning 52c in Q3 but Apple can take down the S&P and Nasdaq, if it disappoints. The sales volume this past weekend at its store was the first time I found myself impressed—even as I realize most Apple customers long ago started shopping for its devices online, rather than in its stores. If you can skim through the Earnings Calendar to single out the emboldened tickers, I think you’ll be quite surprised at the tickers that haven’t, yet, reported. Mall REITs, Hotels, foreign oils, restaurants, media companies, and large insurers stood out for me, along with some other higher profile names like Alibaba, AIG, Activision, Ferrari, Intercontinental Exchange, DowDuPont, AutoNation, and many more, all scheduled for Thursday, when Apple will be the headliner. But, also, Allstate, MetLife, Prudential Insurance all Wednesday, & Berkshire Hathaway, Friday, appear on the schedule. Media makes a firm appearance, too, with CBS, and its radio merger partner, Entercom Media, Gannett, New York Times, and Scripps. I mentioned restaurants, but didn’t specify Starbucks & Yum Brands on Thursday, did I? Or MasterCard Tuesday, when Aetna, ADM, and Electronic Arts are among those reporting. Again, please skim those tickers emboldened, to dispel any notion that the important companies reported with the banks, or last week, and there’s nothing to see, this week.

I-Bank events are still MIA, because the Earnings Calendar is so voluminous. Actually, that’s not strictly true. They’re MIA in the US but all heading for China, evidently. Citi & Jefferies are there on Monday, then Nomura hosts Japanese REITs on Wednesday, when Credit Suisse hosts its Annual China Investment Conference, and Jefferies pops up in Hong Kong, after being in Macau, Monday. Even Euromoney is hosting an Asia Pacific event in Hong kong, Wednesday—AirFinance, specifically. Thursday, Jefferies back in Macau for a Gaming Tour, while Citi hosts China Investor, in Shenzhen, this time. Why all the I-banks are drawn to China this week is beyond me but let’s not forget the 19th National Conference only ended in China, last Tuesday, so perhaps the rush to Asia by investment banks are strategic intelligence gathering events timed to get the news fast and first.

Once, again, healthcare-related events are numerous, including Brain Tumors, Obesity Week, Chest Annual Meeting, Gastroenterology Week, but, for once, healthcare doesn’t have the week all to itself. AAPEX, SEMA, and CARS open their doors right after Gabelli wraps its 41st Annual Automotive Aftermarket Symposium, in Las Vegas. And while it’s Apple’s iPhone X that’s getting all the jawboning, Amazon will start shipping its new Kindle Oasis, Tuesday, the larger screen not nearly as interesting as its ability to read audio books aloud. And it’s not that financials are taking a breather either. Stephens is hosting a Mid-Atlantic-Northeast Regional Banks Investor Plane Trip (the banks to be visited listed on Monday’s calendar), even as BancAnalyst Association of Boston hosts their Fall Financial Conference, starting Thursday. Every big name will be there, perhaps able to comment on Trump’s FOMC Chair pick before the meeting ends, Friday. Coincidentally, The NAR—National Association of Realtors host their Conference & Expo, starting Friday, even as all 3 public real estate brokerage firms (4 if you include Berkshire) report this week. And there’s a preview to the following week’s big events, as EEI & AGA host their joint Financial Conference, starting next Sunday, a mass analyst meeting which, unofficially, ends the earnings season for all but retailers.

So, all in, and despite central bank meetings in Japan, UK, and here, it’s Trump who’ll once again dominate conversation, until he gets on Air Force One, Friday, for his trip to Japan. Given 3 still open vacancies on the FOMC Board of Governors, and a new Chair, almost certain, perhaps the most interesting event of the week will be the Federal Reserve’s Balance sheet, disclosed every Thursday, right after the close.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

October 23—27, 2017   EARNINGS & OVERSEAS CENTRAL BANK ACTIONS     Much as I often hate the research that’s needed to prepare each Outlook, being the one to prepare it—to embolden selected items on the Economic or Events Calendar, and selected tickers on the Earnings Calendar, the advantage is how easily my comments write themselves, once I’m done. It’s both the broad view, and the 10x magnification by the time I’ve finished that makes the comments come so effortlessly.

While Housing stats will be the Economic Calendar’s prime US gift, this week, skewed though the numbers may be by hurricane season. In places like Texas, Louisiana & Florida, insurance companies will not issue policies, once NOAA declares a storm watch. No home sale involving a mortgage can close without insurance, so any closings scheduled in advance of a storm are postponed until after the storm. In the case of southern Texas & Florida’s Keys, that was a tremendous load off buyers, given the condition Harvey & Irma left as they passed through each, respectively. Overseas Central Banks will be very busy, this week. The respective Monetary Policy Committees of the Swedish & Norwegian Central Banks will meet, this week, along with the Bank of Canada, as well as the ECB, ending with Mario Draghi’s early, pre-market press conference, hours before the US trading day gets underway, on Thursday (Bloomberg is superior to CNBC for coverage of Draghi’s comments, live.) Unlike the last few weeks, the US Treasury will be busily issuing debt this week, too, the impact of the Fed starting to unwind its balance sheet too small to pin point as a cause of the rise in US rates. ON the contrary, the growing confidence that December will bring another rate hike seems to be responsible for rates backing up, even as the BoE and ECB might be easing off their gas pedals—even if they aren’t ready to start breaking like the FOMC. Then, again, the FOMC make-up may soon be drastically different. Trump already won Senate approval for the appointee he selected for Bank Supervision. It’s possible Trump will appoint a new FOMC Chief, even as Stanley Fischer resigned, leaving, yet, another opening on an FOMC that already had 2 openings. Does anyone else find it just a bit odd that William Dudley was not interviewed for the position of Chief of the FOMC/Federal Reserve Bank? Bernanke came up through the ranks. So, did Yellen, too. Why not a promotion for Dudley, whose proved a loyal vassal? And honestly, as I’ve said privately, for a few years, Yellen seems to have a touch of Parkinson’s. If her disease progresses like so many others’, Yellen may not want another 4 years or more at the top. Her Friday meeting with Trump lasted about half an hour. I can imagine her entering the oval office and simply saying, "I won’t interview for the job I already have. I’ve provided a steady hand, that’s done nothing to hurt stocks or the economy. Replace me, and you may not get what you think you want." Cause that’s what I’d have done.

As for Earnings, it’s a large calendar with many names whose reports will merely flush done the sink without much notice. I’ve tried to highlight the names I expect the media & analysts to concentrate on—names that could have some ripples in their sector. Monday’s small schedule left me with a few names that were highlighted because they’ll attract, relatively, more attention, only because the day is so slim. And, as I always say, highlighting tickers is a very subjective game, so feel free to disagree. We can, though, pick out some names that shouldn’t be overlooked. Haliburton, Hasbro, Illinois Tool Works, Kimberly Clark, Restaurant Brands, Seagate Tech, State Street, and T-Mobile, VF Corp, Whirlpool, & Zions Bank all made the cut, Monday.

Tuesday, I think we can all agree 3M, Advanced Micro Devices, Akamai, Biogen Idec, Canadian National Railroad, Capital One Financial, Caterpillar, Centene, Chipotle Mexican Grill, Discover Financial Services, Equifax, Express Script, Fiat Chrysler, General Motors, Jet Blue, Lockheed Martin, McDonald’s, Paccar, Pulte Homes, Regions Financial, Robert Half Int’l Ryder, Sherwin-Williams, Stanley-Works Black & Decker, TDX Ameritrade, Tesla, & XL Group would probably be on almost everyone’s list. Edwards LifeSciences is on there, also, because I’ve noticed that device companies often wait to announce recalls until after they’ve delivered a strong earnings report. With one of its aortic valves keeping my 90 year old mum alive, it will always make my list. Centene is one many have never heard of because its premiums are mainly paid for by state & the US Government. It holds a position in the healthcare sector that other insurers don’t really want.

Wednesday, top reports will come from Ally Financial, Amgen, Anthem, Barrick Gold, Boeing, Buffalo Wild Wings (they’re wings are larger than those served at the local B-B-Q joint, I’m told), CA Corp, Cemex, Chicago Bridge & Iron, Citrix Services, Coca-Cola, Digital Realty, Doctor Pepper Snapple, Ethan Allen, Freeport McMoRan, General Dynamics, GlaxoSmithKline, Gold Corp, Kimco Realty Trust, Lab Corp, Las Vegas Sands, Lear Corp, M/I Homes, MSCI, Nasdaq, Norfolk Southern Corp, Northrup Grumman, NutriSystems, NXP Semiconductors, Penske Automotive Group, serviceNow, Six Flags Entertainment, Thermo Fisher Scientific, Visa, Walgreen Boots Alliance, Wyndham Resorts. Got a beef with any other those? I didn’t think so.

Which brings us to Thursday, with another Builder, AVHI, Alphabet (anyone else which they’d spin off Google so we can go back to talking about Google earnings, which is all Alphabet really has?) & Amazon, AmBev, Budweiser, American Airlines, Baidu, Borg Warner, Boston Beer (what were the odds all 3 breweries would schedule their reports on the same day? Do their analysts merely take off the rest of the earnings season?), Boston Scientific, Bristol Myers Squibb, Brunswick Corp, Celgene, Chubb, CME, Columbia Sportswear Co, Comcast, ConocoPhillips, Deckers Outdoor, Deutsche Bank, Expedia, First Solar, Hershey Chocolates, Hilton, Intel, Invesco, KKR, LogMeIn (the most overlooked internet star in the universe), Marathon Petroleum, Mattel, Microsoft, Mohawk Industries, Newmont Mining, Nokia, Potash, Royal Caribbean, Southwest Airlines, Spirit Airlines, STM Micro, Twitter, Union Pacific, UPS, Valero, Waste Management, Western Digital. The list, even in this abbreviated form, makes Thursday a pivot day, upon which stocks could either turn its attention to the tax cut plan or worry about what the economy brings next. Come Friday, Abbvie, Chevron, ExxonMobil, Goodyear Tire, Merck, Mertage Homes Corp, Phillips 66, Shire Plc, Simon Property, Sohu.com, Total, TransUnion, UBS, and Weyerhaeuser. No matter what the next 2 weeks bring, once this week is over, the earnings story will be completely laid out enough for traders to relax and look ahead to year end, and the tax bill the Senate plans on ramming through Congress—assuming they can get Trump to agree to sign it. He’s just obstinate enough to reject the bill because it includes a corporate tax rate that would be lowered to 20%, instead of the 15% he promised on the campaign trail.

Note, there are almost no I-bank conferences, because it’s the "height" of Earnings season. Can it be mere coincidence that so many defense companies are reporting this week, when Precision Strike Technology Symposium & Homeland Security Conference & Expo also meet? For what it’s worth, I believe financials, like JPMorgan, Bk of America, et al, could use a rest. GE may have hit an inflection point, after last week’s Earnings release, while, perhaps, Minds & Machines will lift the mood around its outlook, Wednesday. Some of the cord-cutting pressure could be put to rest by Comcast’s report—it’s recent entry into wireless services not much of a big push, yet but around here, it’s been picking up home phone customers by the hundreds, as AT&T is still working on restoring services 6 weeks after Irma passed through. I’m one of its customers who got service back around 7 days after the storm, then lost it on the 11th, and haven’t been able to rely on a dial tone since. At first, I was told service would be restored on the 11th, by 6pm. By 8pm, that night, I was told the 25th. Of course people are fleeing AT&T in droves.

At the end of the week, Apple starts taking pre-orders for the iPhone X but note, it doesn’t report the Quarter just ended until 11/02, so don’t expect much help there. The iPhone X won’t be in stores or ship to pre-orders until the 3rd. And that brings us to the biggest wild card—Trump, himself, and the rumblings around Washington that he is a moron, when it comes to diplomacy, and the Veep & his cabinet should work on removing him from office before he blows all of us up.

ECONOMIC: (Highlights, only, below. The Full International Economic Calendar is here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed is the author’s, alone, and should be just one factor in more complete due diligence.  

October 16—20, 2017   SHIFT INTO 2nd GEAR     Like a car with a manual transmission, the Earnings Season made it through 1st gear, with only Wells Fargo noticeably disappointing. This week, the Earnings Calendar shifts into 2nd gear, with more banks, 3 rails, a couple of airlines, and some triple digit DJIA stocks, including Goldman Sachs, IBM, J&J, and UnitedHealth Group on Tuesday, alone. And it doesn’t stop there; Thursday there’s Honeywell, Travelers, and Verizon, to name just a few. So what the Earnings Calendar lacks in volume it more than makes up for with some influential heavyweights. As always, we didn’t include dozens of regional banks but did highlight the tickers we expect to attract the most attention from traders, analysts, and the media. Feel free to disagree.

After last week’s heavy central bank speaker schedule, while the IMF & World Bank Group met, their joint meeting doesn’t really end until Sunday, 10/15, when the G30 International Banking Seminar draws Janet Yellen, People’s Bank of China’s Zhou, BoJ’s Kuroda, chief White House Economist, Gary Cohn, and ECB’s Draghi. For that matter, there are not only another near dozen central bankers from around the world at G30 but even the still young Asia Infrastructrure Investment Bank, who’s President, Jin Liqun, is a panelist. Maybe it’s just me but I can’t really remember a sitting president so prominently interviewing replacements for a sitting FOMC chief, who hasn’t announced an intention to retire. Seems to me, Trump is treating the FOMC chief’s position as just another version of The Apprentice, with weekly, if not daily episodes with different contestants.

No sooner does the IMF, World Bank & G30 pack it up then the NY Federal Reserve opens its 41st Central Banking Seminar (CBS). Many of the same players who were speakers and/or panelists at IMF/WBG are prominently scheduled for the CBS, which promises NY Fed’s William Dudley, Fed Gov. Jerome Powell, RBI’s Patel, BoJ’s Nakaso, and many more central banking luminaries from around the world. It also promises former Treas. Sec’y Timothy Geithner, Paul Tudor Jones II, the Saudi Monetary Authority and, once again, the People’s Bank of China. That’s why there are so many more junior level economists and bankers speaking at SIBOS, the SWIFT system Financial Forum--the central clearing house for central banks, an $80m hack still unsolved, a few years later. And, goodness sakes, as if all the central bank meetings weren’t enough, the Bk of England is hosting its Inaugural CEBRA—Central Bank Research Association International Finance & Macroeconomics Programme. And Fed Chief Yellen gets another chance, Friday, to reinforce her confidence in the economy, and another rate hike in Dec. that she still believes will be needed. She’ll be at the National Economists Club (NEC) delivering the Herbert Stein Memorial Lecture, hosted by the British Embassy in D.C., at 7:15pm, Eastern time.

Housing Data out this week could well be skewed by the hurricanes. So, too, Sept Industrial Manufacturing & Capacity Utilization, the weather, no doubt, worth mention in the Beige Book, out Wednesday afternoon, at 2pm et. Friday, Sept Existing Home sales were surely skewed by storms, Florida insurers blocking issuance of policies as much as 10 days prior to its arrival on 09/10, and for days afterwards. Yet, activity here, in South Florida has been so active that 7 neighbors have sold their homes in the past 2 months. Three already closed, and 4 more are closing before October is over. Typically, summer through September are the slowest months of the year for existing home sales but not this year. There’s been a feeding frenzy, the early buyers getting much better deals than the late comers, making the activity feel a little like what resembled a short squeeze in 2006 & 2007, in the lead up to the housing market collapse.

There are not a lot of investment bank conferences, this week, and probably won’t be many next week, either, in deference to a more crowded Earnings Calendar. It may be a light week for I-bank events but there are plenty of industry events scheduled, that won’t lack news. Analysts can’t be listening to I-bank conference presentations when their days are filled with post-earnings release conference calls and webcasts. Some large industry events include High Point, the Semi-Annual Furniture Market, that attracts lots of newsprint. Healthcare is prominent, as it seems to be weekly, with Dermatology, Gastroenterology, Laboratory Science, HomeCare & Hospice, Lung Cancer, Human Genetics, Pharmaceutical Distribution, BIO Investor, Thyroid, Orphan Drugs & Rare Disease, Drug Delivery, AIDS, and even Itch (started Sunday). But there are also a number of large events that have nothing to do with healthcare. AES for Audio, Air Traffic Control, American Bankers Ass’n, Recruiting, North American Forests, Electronic Payments, WSJ’s D.Luxe & D.Live, FIA Futures & Options, and NAB, for Broadcasters, meeting in NY starting Wednesday, the day AdWeek will hand out the Brand Genius Awards. A Housing Giants Leadership Conference is in Arizona, while ALM RealShare hosts Apartments in Los Angeles.

So how does it all add up? Typically, this week and next are the Earnings Season weeks that see stocks slip, as more disappointing results get through the crowd of results. In a typical Earnings Season, after a couple or 3 weeks of stock slippage, usually sees a rip roaring rally that can, often, last into the year’s end. However, given how atypical this market has been, and how long it’s been since we’ve seen a 5% correction, I don’t think anyone can expect a "typical" earnings season—not even the profit taking and tax loss selling mutual funds usually execute before their fiscal year ends on 10/31.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.
  

October 09—13, 2017
BANKS HOLD THE KEY      It’ll be a slow start for the week, with the Bond Market closed Monday, which may mean that stocks will churn waiting for direction. Fed speakers are out in force, again, with the Joint World Bank Group/IMF meetings not gaining impetus until the 12th. With FOMC Minutes of the Sept meeting out Wednesday, and the fewest Fed speakers that day, though IMF Managing Director Lagarde & World Bank head Kim will fill in the pause. Thursday, Fed Gov. Brainard and the ECB’s Draghi among the speakers at the Peterson Institute, at which former Fed Chief Bernanke will present a paper—likely to be seen as a surrogate for the current Fed, since the theme is "Rethinking MacroPolicy." Thursday PPI, Friday CPI and Advance Sept Retail Sales round out the highlights of the Economic Calendar.

Wednesday, BlackRock & Delta Airlines report results. Thursday, Domino’s Pizza & JPMorgan Chase. Friday, Bk of America, PNC Financial & Wells Fargo report, which should set the tone for earnings season. Financials resumed their trot to new highs, again, after a more detailed tax scheme was released. The questions is whether banks like Bk of America & JPMorgan have galloped too far ahead of their results, baking in too much in tax savings that may be farther off in arriving than assumed.

On Sunday, as I started formulating my view of the week, both the Edison Electric Institute & American Gas Association started fall meetings, the National Key Accounts Workshop for EEI, which means most major utilities will be speaking, either individually or as part of panels. AGA, on the other hand, is the State Affairs Fall Committee Meeting, in short, state legislative & regulatory policymakers, so in addition to the various public service regulatory commissioners, there’s, also, Dominion Energy, Enbridge, Atmos Energy, Avista Corp, National Grid, SoCal Gas, ConEd, Itron, and more. Both Meetings are over on the 11th

American Solar Forum starting Monday, is in Denver, which strikes me as off the beat and path, compared to past high profiled events. Tuesday, RBC Global Towers Investor Day will be small but influential, just as Digital Hollywood Experience is the opposite—filled with a massive number of people. Brand Licensing Europe is likely to bring another BBC show to US shores. It’s rare that it goes the other way, from the US to the UK. Note Box, IBM, nVidia, Oracle, Tech Data, Walmart & Workday events on Tuesday, the 10th, in addition to the P&G shareholder meeting at which Peltz hopes to be elected to the board. Thursday, Jefferies hosts Gene Therapy, Gene Editing & Novel Technologies, in NY, plus Automotive News Retail Forum are some of the highlights, before Box, Hewlett-Packard & Lattice Semiconductor meet with analysts. So, too, do Macquarie, Spark Therapeutics, and Spartan Motors. Friday, an Interdisciplinary Conference on Supportive Care, Hospice & Palliatives Medicine, in Houston, plus the American College of Gastroenterology Annual Scientific Meeting are the twin heavyweights. Saturday’s High Point Furniture Market is cause for the leisure sections of newspapers to preview what’s coming next spring. The better house sales, as a rule, the better furniture sales, too.

But in the end, it’s the bank earnings that are going to decide the market’s fate, so fiddle with some numbers to figure out if the good news is already baked in for all but Wells Fargo, still suffering from the sins of a too aggressive workforce. You might recall JPM pulled back rather deeply after July earnings. So did BAC, which hasn’t been able to hold atop $25, and suddenly above $26, breaking out.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone and should be just one factor in more complete due diligence.
  

October 02—06, 2017  ANOTHER WEEK OF FED SPEAKERS + SEPT UNEMPLOYMENT REPORT    China’s markets & factories are closed for the week, Golden Week which started today (10/01) with National Day. That applies to Hong Kong, as well, and even a couple of days of holiday in South Korea, as well. Add in the Supreme Court back in session, and the September Motor Vehicle Sales, Tuesday, & Friday’s Unemployment Report, and a slim Earnings Calendar is just what the doctor ordered. As for Friday’s Unemployment, the impacts from Hurricanes Harvey & Irma remain large unknowns but, surely, aren’t likely to push the Unemployment Rate any lower than it got at this year’s best—4.3%. Likewise, just as Floridians were battening down the hatches to minimize Irma’s damage, at least some in Houston and environs must have been replacing the cars Harvey flooded out. Therefore, no matter how disappointing the September Motor Vehicle sales, there should be plenty of optimism about October, when the last of Harvey insurance funds join Irma’s farther East, to boost future sales. Consumers with money to spend are the answer to Detroit’s prayers.

On the other hand, this is the first week of EIA petroleum, gasoline & distillate stats that should be free of hurricane influence. I was quite surprised to see my new next door neighbor so swiftly pour the extra gasoline he bought pre-Irma into his auto tank. Granted, Irma had passed, gas was, again, easy to obtain and he has 3 cars to fuel but, honestly, those of us who’ve lived her longer know that hurricane season continues into the end of November, while the worst storms we’ve suffered have come all too often in October—Halloween storms, on several occasions. That gasoline stockpile may still be necessary during this month. While we’re talking about storm effects, I suppose we can’t ignore the risk to mortgage holders, of "owners" walking away from the pick-up sticks storms left in place of their former homes. To date, delinquencies have continued to fall to record lows but expect that to start reversing, now. Even if owners don’t walk away, someone who lost their home and everything in it, may not have, yet, collected their insurance settlement, so perhaps too busy buying the bare necessities to pay their mortgage, especially when many either couldn’t get to work, or found their workplace closed in the wake of Harvey’s floods. And in Puerto Rico? An island that barely functions under the best of circumstances; right now? OMG, it’s heart breaking. We all know Trump loves to pat himself on the back but in San Juan, there’s no doubt that the Mayor’s accusations of a slow response from FEMA is well deserved. The President planning on showing up 2 weeks after the storm? Inexcusable, especially when the President was, instead, preening on the greens of The President’s Cup golf tournament. I lived in Isla Verde for 3 years, so I can speak from first hand experience about how poorly P.R. often functioned without an apocalyptic storm destroying most of the buildings and the entire electrical transmission grid.

I’ll leave the Fed speakers to the Economic Calendar, which details them better than I could here. It appears, the Balance Sheet unwinding starts this month, and a December rate hike remains on the table, even in the presence of 3 Fedheads who think the FOMC should back up until inflation gets closer to its 2.0% target. But speaking of the FOMC, the market was remarkable in its digesting the fact that Trump is interviewing possible new FOMC chiefs. Perhaps that’s because the people named by the Journal are either FOMC members or Cohn, head of the Council of Economic Advisors, and considered a known quantity. Should Trump allegedly interview some hawk, or other person with theories anathema to the Street, the reaction could be very different. Much as we know Trump likes to claim credit for rising stocks, we don’t put past him at least one outlier being interviewed to shake up the status quo. What Trump seems to love, best, is causing a stir. Last of the Economic events to watch is US August Consumer Credit (debt, really). Again, we have Harvey to blame for any weird number, and will have Irma to blame when September is released, in another month. Nothing anyone can do about that.

Earnings are short and sweet, Lennar & Paychex on Tuesday, Monsanto & Pepsi on Wednesday, Constellation Brands, CostCo & Yum China on Thursday. Note, I did not separate earnings reports into pre- or post-market releases. It’s just too incredibly time consuming to provide that info. And presumably, anyone who needs to know that info can look it up themselves. We need the Weekly Outlook to be less time consuming, so have looked for features that strike us as disposable.

The Events Calendar isn’t as busy as it’s been for most of September. EEI (Edison Electric Institute) and AGA (American Gas Association) don’t usually both meet starting the same day but they do as I post. First, note China is on Golden Week holiday all week, which closes its markets & factories but are a boon, as a rule, to Macau casinos & hotels. There’s little reason to expect this year to be different. Chinese stocks often bounce big the day Golden Week ends and there’s little reason to expect a departure this time either, no matter if FXI rises or falls, during the holiday close. Monday’s big events should be Deutsche Bank’s Leveraged Finance Conference, and the Solar-related events. With so much rebuilding needed in Texas, Florida and the Caribbean, along with the President’s intent to ramp up infrastructure, as well as build his wall on the Mexican border, North American Steel should be well attended, too.

Tuesday, G2E for Global Gaming could be tops. Note Gildead’s takeover of Kite Pharmaceuticals could close Tuesday, too, a rare speedy closing. Sherwin-Williams among the companies planning analyst meetings but already warned on hurricane disruptions, so likely to pop in association with its analyst meeting Tuesday, in New York. We3dnesday, I’ll call out Cowen’s MedTools, ARM (Regenerative Medicine) Cell & Gene Meeting on the Mesa, the 12th Annual Emerging Infectious Disease Week, AARC’s Respiratory Congress, World Cardiometabolic Health Congress, along with the FDA Vaccines & Related Biological Products AdCom, and Madrid’s vb2017 (digital) Virus Bulletin Int’l Conference, add up to a lot of healthcare-related events starting that day, even as Mallinckrodt (MNK) Specialty Brands Investor Briefing is planned for Wednesday, too. It’s very hard to expect a different event outside healthcare to dominate, except, possibly, the Senate hearing on the Equifax (EFX) breach.

Thursday, on the other hand, promises a spotlight on Energy, with both Raymond James & CanaccordGenuity planning Energy event--even before ESNA, Friday’s Energy Storage North America, which starts Friday. IPAA’s OGIS meets this week, too, but may not lead to much noise. Energy companies have been disposing of assets and buying smaller names without waiting for a specific conference for the independents. If Allergan and Valeant are in your pocket, then perhaps, Thursday’s Retina Society Annual meeting are more important. Also Friday, the Nobel Prize for Peace, and the opening of "Blade Runner 2049," which might be the best thing to happen to movie theaters since "Wonder Woman." Pre-sales of tickets are off the charts with another week of pre-sales to go.

The market might go back and forth between gains and losses, farther into the month, depending on what pre-announcements look like. Companies that have warned have been slammed to the mat, even if what caused the warning was temporary and unique, as Sherwin-Williams’s warning due to hurricanes. Of course, that sell off has opened the door to gains, at Tuesday’s analyst meeting. Oracle could also rise, at its analyst meeting concurrent with OpenWorld, given that its recent earnings report was good enough. All things considered, the Russell 2000 breaking out last week could be a good reason for the senior indexes to consolidate their YTD gains, as it appears FANGs have been doing for a couple of weeks. Stocks taking a rest, about now, may be just what the doctor ordered in front of Q3 Earnings Reports that, like SHW, may have been disrupted by the hurricanes.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar, here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

September 25—29, 2017   CENTRAL BANKERS EVERYWHERE!    Central Bankers will be out in force, around the world, this week. US Federal Reserve presidents & governors will be everywhere, including the Atlanta Fed’s new chief, Bostic, on Tuesday. BoE’s Carney & ECB’s Draghi will be together, in "conversation," well before the open on Friday, 9/29. They’ll be at BoE’s "independence 20 year on," which h also features the IMF Managing Director Christine Lagarde, and the heads of central banks in Israel, South Africa & Mexico.

A few of the US Fed speakers will make their appearance at NABE, which kicks off on 9/23, with a welcome reception hosted by Macroeconomic Advisers, after an address by HSBC Sr Eco Adviser--the author of "Grave New World," Stephen D. King. On the 24th, speakers are expected from UPS, IBM, Walmart Stores, Nat’l Rita Federation, Austan Goolsbee (UChicago Booth School of Bizz), Redfin chief economist, and speakers from Harvard Grad School of Ed, MIT Sloan School of Mnfmnt, & NRF’s chief Economist, Jack Kleinhenz. More 2nd day speakers include reps from Intel, Airbnb, UC Berkeley, & BuildZoom, NCREIF, Real capital Analytics, Internet Association, Wells Fargo, MacroPolicy Perspectives, The Group of Thirty/NABE President, Greater Houston Partnership, plus a KPMG Rock & Roll Hall of Fame Reception. On the 3rd day, 09/25, Lord Adair Turner (former chair of UK FSA), FDIC Assoc. Dir Rich Brown, Yale Prof, Chicago Booth School of Biz, and VP of Fed Reserve Bank of Dallas. More speeches from IMF, Dpty Mng Dir Tao Zhang, CEMEX, Altarum, and the presentation of the 2017 Adam Smith Award, involving former Bank of India chief, Raghuram Rajan, Nat’l Ass’n of Realtors’ (NAR) Lawrence Yun, Institute for Supply Mngmnt, Original Equipment Suppliers Ass’n, Case Western Reserve U, and American Chemistry Council, Wells Fargo, Taussig Cancer Institute of Cleveland Clinic & Case Western U School of Medicine, UBS’ Seth Carpenter, a sr VP of Fed Reserve Bk of NY, Morgan Stanely’s chief US Economist, Ellen Zentner, the Congressional CBO’s Chad Shirley—whose scoring of Graham/Cassidy healthcare revision may arrive after a Congressional vote on it—RHB Banking Group, Macronbond, Export Development Canada, Marathon Petroleum, J.M. Smucker, Sr VP of Fed Reserve Bk of Cleveland, who’ll host the reception 2 hours later, M.I.T. Prof of IT, Orbital Insight, Indeed. On the 26th, speakers include Chair/CEO of KeyCorp Beth Mooney, KPMG chief Economist, Martin Feldstein (Harvard U), PNC Financial Services sr Economic Advisor, IHS Markit Exec Dir of Economics, ECB’s Masuch, Loretta Mester, Pres/CEO of Fed Reserve Bk of Cleveland, Trammell Venture Ptnrs, Votem, Fidelity Investments, Columbia Univ, Rice U’s Baker Institute for Public Policy, McKinsey, ConocoPhilips, Mitchell & Best Homes, NFIB (Nat’l Federation of Independent Business), and Janet Yellen from 11:50am –1:30pm, head of US OMB (Office of Mngmnt & Budget)’s Mick Mulvaney, Caterpillar, Boeing Commercial Airplanes, Ford Motor, Eaton Corp, to finish off the day and the event. To call Yellen the keynote, speaking on the last day of the event, in the 2nd to last slot for all events, is a stretch. You might think the National Association of Business Economics, big deal but don’t sell it short. The event has been a big noisemaker since its 1997 Annual Meeting, business economists, for the most part, missing the tech bubble and, later, the housing bubble, just as central bankers did though, perhaps, not quite as completely as the central bank heads. There were a few Cassandras trying to warn the world that "this time was no different."

Topics at the ECB Research Workshop include "Exit from non-Standard Monetary Policy," "Life Below Zero: bank lending under negative policy rates," Payments, credit & asset prices," to highlight a few. Just the discussion topic could rile investors, because Draghi insisted the ECB is not exiting QE before the year ends.

I’ve tried not to overlook any Fed speakers, including Janet Yellen 2nd to last at NABE, and via video conference at a K.C. Fed event, even though the Economic Calendar below, is just highlights, heavily weighted towards US Economic Data. For the US, besides Central Bank speakers, this week promises housing data like July’s 20-city Case Shiller Home Price Index (HPI) and NAHB’s Aug New Home Sales on Tuesday. Also notable, Aug Durable Goods Orders/Shipments, and the final look at Q2 GDP, PCE, and Aug Wholesale & Retail Inventories.

The Earnings Calendar is exceptionally slim, with just a few names highlighted, and another few not. That slender list that opened the door to another flood of Events, topping last week’s deluge. Even so, there aren’t a tremendous number of events I can endorse as a trade but a few caught my eye. Targeting Ocular Disorders, part of Discovery on Target, in Boston, is so narrowly focused it might well open a trade opportunity. Likewise, HCV-Hep C & Related Viruses, in Cape Cod, might be worthy, too, for its tight focus. . Deutsche Bank is hosting Insurtech in London but anything that brings insurance execs together probably draws attention after hurricanes hit the islands & Florida, as well as Texas & Louisiana, even as the Mexico’s earthquake disasters will be costly as well. Unfortunately, insurers may find out which buyers of catastrophe bonds have too little capital to back up their bets. For the same reason, BAC/MER’s Financials CEO Conference in London may, also, yield news.

Oil, Gas, MLP’s and, just plain energy conferences deserve more attention since Harvey disrupted refining flows. It’s a sector that might be worthwhile to examine. While Chevron has made an impressive recovery, since returning to $100 p/share, there are others that still offer more value, waiting for a buy. Monday, Johnson Rice hosts an Energy Summit, while Wolfe Research is webcasting a Utilities & Midstream Conference Preview. Tuesday, Credit Suisse is on an Annual Oilfield Services non-Bus Tour, while Wolfe Research hosts a Utilities & Power Leaders Conference in NY. Also Tuesday, Platts is hosting the 40th Coal Marketing Days which doesn’t make me any more interested in coal. Wed. Deutsche Bank hosts an Energy Summit in Boston, while the World Energy Engineering Congress opens its 40th meet. Wolfe Research, again, on Thursday, hosts an Oil & Gas Leaders Conference, while MLP: Publicly Traded Master Limited Partnerships Annual Meeting will convene in D.C. Chevron has always been my favorite major but is hard to buy where the stock closed last week. However, in general, it pays to think about how many major projects were shelved, over the last 2 years. Given how long the lead times are for some big projects, like CVX’’s LNG plant in Australia, you either have to believe electric cars take over or feel certain that the lack of spending on major new finds will make oil and, therefore, gasoline, some of the most expensive they’ve ever been. With budgets slashed to the core, over the last 3 years, it’s not hard to imagine a time in the near future when oil is in shortage and, therefore, a lot more expensive.

I caution that this is the first month to end under T-2, and what will make Friday’s trade even more thin is Yom Kippur starting at Sundown. That’s the Holiest day in Judaism, the Day of Atonement. Even Jews who don’t observe much else about their religion, at least take note o Yom Kippur, and could look for excuses to avoid spending any money on Saturday. Luckily, it’s a one-day holiday, no matter which flavor of Judaism is practiced, and there are only so many new pairs of jeans one can need at half price—especially when the vast majority of jeans look like they’re decades old, run though the washer & dryer way too many time. Last time I had a pair of jeans as ripped up as the ones teen retailers are selling as new, I ripped them around the knee and turned them into shorts.

Ameren Corp, (AEE) Senior Management is supposed to meet with Wolfe Research clients on either Thursday, the 28th, or Friday, the 29th, in Boston. Where the "either or" comes in is that the blurb announcing the event with the Pres/CEO, CFO, & IR, says "in Boston, on Friday, September 28th, when the 28th is Thursday. You’d think a client would have mentioned the mix-up when RSVPing to Wolfe but, evidently, no one did, or notice hasn’t results in a correction.

It’s football season and the tail end of September, which means the networks roll out their premiers of both returning and new shows. Star Trek Discovery debuts on Sunday, the 24th,but then, moves to "CBS All Access," a streaming service, which means couch potatoes have to pay to watch the following episodes. "This is Us," a rare NBC (CMCSA) megahit, returns on the 26th. A former "Saturday Night Live" alumn, Bobby Moynihan debuts in prime time on "Me, Myself, and I," Monday, the 25th, with other actors playing both his young and grown up self—veteran sitcom star John Larroquette playing the all grown up character. On the 28th, NBC debuts the returning "Will & Grace," which has the network and public so excited, NBC has already signed on for a 2nd season.

As we slide out of Q3, and enter Q4, be very worried about earnings warnings. There have been enough natural disasters to upset many well planned quarters, perhaps for no one more than the airlines. Whether it was Harvey trashing Texas & Louisiana, or Irma trashing the Caribbean & Florida, airlines scrambled more to get their aircraft out of harms way than they did to pick up extra passengers looking to flee. In Florida, when Irma wasn’t expected before Sunday, airlines were canceling flights on the Friday before, as soon as the Tuesday prior. Even today, the Keys look like a bombed out wasteland that isn’t likely to be ready for tourist season, no matter how hard they try. Having been in a 9.1 quake in Mexico, in the 70’s, I know how badly the country suffers after a quake. While both quakes that were recorded, so far, were less severe, that doesn’t change the economics of rebuilding.

To everyone who celebrated Rosh Hashana last week, and will observe Yom Kippur this week, L’Shona Tova. May you have a happy, healthy and sweet year.

ECONOMIC: (Highlights, only, below. The complete International Economic Calendar is here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

September 18—22nd, 2017  
NOTHING LIKE A NATURAL DISASTER to MAKE WORK LOOK GOOD    The past week was a week of horrors. A whirlwind of pre-Hurricane Irma activity—especially stocking up on regular gas to run my whole house generator—ended with Irma’s arrival on Sunday, 09/10, ended electric power for 5 days. But that wasn’t the end of it—after 36 hours of electricity, during which neighbors in one direction continued to suffer without power, we then lost power again, and watched those previously deprived get light and A/C back, as ours disappeared again. In 2006, after Wilma & Jean in 2005, I had my house wired for what’s termed a "whole house generator" but, in truth, powers anything but extreme heating elements, like my clothes dryer & oven. Not a problem given microwave ovens & the Swiss Army knife of kitchen appliances, a table top toaster, oven, rotisserie, convection oven, and a two-burner stove, and Sterno set up that assures me safely heated food. Well, that’s if your generator doesn’t catch fire on start-up, which mine did.

So, no power, no internet, and no way to either post new dates and/or additional events, and no way to pull down all the information already posted to the website database—at least not for hundreds of miles. Ninety-one degrees? Not really a problem while the battery operated fan worked but getting hands on D batteries was an even bigger challenge than obtaining gasoline. I started an order on Target, promised delivery the following day but by the time I answered my doorbell, for someone checking up on my health, and returned to the PC, the TGT delivery had changed from the next day to "unavailable—out of stock." And that was the case for the following 6 days, which assured I was able to buy "D" batteries just in time for the power to return—at least until the next storm. Hundreds of dollars worth of food lost—that’s the way the cookie crumbles. And the weekly Outlook? Well, I’ve done the best I could. At one time, NABE, the Nat’l Association of Business Economists showed Janet Yellen "invited" to speak. Today, I couldn’t get into the site, at all, my security software not allowing a connection to the website it termed "not secure." So I couldn’t learn if Yellen is on the schedule or not. The Fed Reserve’s What’s Next calendar give no indication that Yellen is speaking next weekend at NABE but that isn’t necessarily required, either. When FOMC members speak at NYU Money Marketeers or other private organizations, their pending speech doesn’t make it onto the official calendar—only official events do.

Transferring the Economic Calendar to the space below is not happening. I’m all worn out and watching Maria approach, the likely next hurricane in what’s already been a deadly season. For a week, I’ve been thinking about breaking up with Florida. Sure, it was nice, last winter, enjoying temps in the low 70’s, when much of the country was frozen solid but that was the most picture perfect winter we’ve had in 23 years—too infrequent to wait around through another hurricane season to taste. Usually, we’re lucky if we get 5 days a year to remind us why we put up with 6 months of a sweltering environment, annually. My mom, 8 miles away, has done nothing but encourage me to move away. She simply doesn’t give a damn whether I’m around or not, as long as her aide shows up daily. I’m sure other devoted children have experienced the same indifference and rejection but I’d rather she had Alzheimer’s, so her lack of warmth and nurturing has a good excuse. No such luck. Instead, I have to face the fact that my mom simply doesn’t give a damn.

And then, there’s this week: An FOMC meeting & Yellen press conference, likely to result in nothing more than a date certain to set on autopilot the unwinding of the Fed Reserve’s swollen balance sheet, and some statement affirming the Street’s expectation for a December rate hike, next! And here’s the thing: Harvey & Irma almost assure the higher inflation the Fed has for years seen as imminent. The price for various grades of gasoline has already jumped considerably (premium is up 90c a gallon or, more precisely, 9/10ths of a gallon), and is likely to remain elevated for awhile, as the Gulf Coast works its way back from Harvey & Irma. Fruit & Vegetable prices are likely to be much higher for the next several months if not quarters, as the Florida farm belt got whallopped by Irma, the annual orange season all but lost, many of the trees in the groves likely lost for good. Avocados, tomatos, cantaloupe, lettuce, grapefruit—you name it--if grown in Florida or Georgia, this season is lost, and so might be many future seasons. In Texas, a cotton crop was destroyed, and probably more I’m not conversant in. With those losses are thousands of lost migrant jobs, which will strain local governments, not used to letting its population go hungry—no even transient populations. You have to visit to understand what the winds did to trees and shrubs. My community was largely spared because, last year, when I was President of the Association, I contracted to have our oldest, largest trees thinned and their crowns reduced, at a cost of $250—400 more per tree than a regular, annual trim. But some of the fanciest country club communities didn’t go that route, and suffered this year, as a results. Old ficus & olive trees toppling over, wiping out palms and hedges that were in their paths. Not only is the amount of plant debris unimaginable, but it will take weeks if not months for it all to be picked up. In the meantime, collected in piles on the side of the road, the drying, dying vegetation is a tremendous fire risk, that only rain will prevent, and we haven’t had much of it since dearly June. Even Irma, for all her howling winds, brought only a little precipitation.

While the Outlook below may seem lacking it’s the best I could produce, under the circumstances—better than most would have managed under equal circumstances. But, then, I can’t go shopping to restock my fridge because our power is still not restored. Yes, I currently have electricity in my house (for as long as it lasts, evidently) but it’s not because the power grid has been restored. On the contrary, the entire area is being run on generators. For those who know Boca Raton, I’ll offer this example: The 4-way intersection of Glades Road at 441 (State Road 7, 4—6 lanes in each direction) had no traffic lights for 5 days. While radio & TV implored everyone to treat an intersection without working lights as a 4-way stop, an intersection like that could result in multiple car pile-ups if just one person is either inconsiderate, forgets, or didn’t get the memo. For the last 3 days the traffic lights all over town have been operating on generator power, with 2 workers assigned to each one, each worker sitting in his air conditioned car, making sure the generator keeps working, and gets gas & oil when needed. But, you know, such a complex intersection can’t be run by a single generator. No, it needs 2, and 2 more guys at the 2nd generator, to make sure the 2nd generator works like it’s supposed to. Ditto Glades & Lyons Road. Ditto hundreds of other intersections, including those at the Turnpike & Interstate 95.

My community, 703 homes, is being run by 5 generators. One of them blew up this morning, knocking out power to 261 homes. Luckily, it was only a few hours before another generator arrived and could be connected. One of our 5 generators says "Boca Winds," another, local community, though I don’t know exactly where. I’ve heard of it. My mom got her power back 28 hours after her community went dark. Why my community needed another 5 days remains an enduring mystery, because it’s always thus. Perhaps time to move to a 55 & over community, where the elderly are taken care of more quickly than my "all-ages" community. And who am I to complain? Eight elderly residents of a nursing home lost their lives, some to heat exhaustion, because the power went out and their generator failed. They called the governor’s office, and FPL several times and no one got back to them. Temps in the building rose into the high 90’s and higher—top floors here are killers, when attics heat up. And the night time temps are still in the 80’s, which assures the attic never cools, and neither does the upper floor. I was actually grateful to have a 2-story house, because downstairs was so much cooler, comparatively, and with a fan pointed at my face, I was able to sleep.

So let’s be honest, there are still plenty of other people without power—those in Key West can’t even begin to contemplate something as normal as A/C. The biggest winners of the storms are Energizer (ENR), making of EverReady flashlights & batteries-- Mom’s preference, Berkshire Hathaway’s Duracell (my preference), Briggs & Stratton (BGG), which makes the motors, no matter whose generator one buys, and the generator makers, themselves. Just as I wired my whole house in 2006, after Wilma & Jean in Oct. 2005 knocked out power to my home for 9 days, so too will many other people, over the next year, wire their homes and buy generators. But really, BRK.A is a bad choice. Duracell is a minor division that probably can’t move the needle. And then, when Florida ran a sales tax holiday for hurricane supplies, in 2006, we all bought so many batteries, it was years before we needed to buy batteries again—2017, to be precise, as Irma was bearing down on the keys, and most stores had only double & triple "A’s" not the D’s we really needed to run our portable fans. BGG, however, is a big winner, and so will be Energizer. I saw a lot of Rayovac (SPB) batteries at Walmart but I don’t favor them, at all. When Radio Shack went bankrupt, it lost 4,100 doors, and a few hundred more as Toys ‘R Us slimmed its bricks and mortar presence. The Auto Parts stores (won’t be reflected in AZO’s report this week) probably cleaned up, selling sport & car batteries for generators and proper gasoline carriers, once Walmart ran out of supplies. At WMT, a 5-gallon gas carrier like gardeners use costs $5.99. At Autozone, it’s $8.99. I have a couple of 30 gallon carriers on wheels with pumps, like those used dockside, when one rents a personal watercraft. I’m too worn out to go out to the garage and tell you who makes them. Maybe I’ll have the energy by tomorrow.

Much as I’ve thrown together a somewhat respectable Outlook with highlights of the coming week, I worry about the weeks to come. I lost a full week of posting events, so once a month ahead of where I needed to be, now barely treading water. Perhaps someone’s telling me it’s time to call it a day.

ECONOMIC:
FULL International Economic Calendar here

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence. 

WORK IN PROGRESS, Irma knocked out power & internet almost a minute after I posted the work in progress. It was a week before our power came back, and then we lost it, again, 46 hours later. offline. Our webhost is in Coral Springs, FL, with back-ups in Houston TX. Not the best cities for the promised uptime, thanks to Harvey, Irma &, even, Josie. Rather than withhold all I’ve worked on for days, I guessed partially finished is better than nothing at all. So here is the largely Unedited and Unfinished Outlook.

September 11—15, 2017 I’m preparing this, well aware my work may be for naught, even if the worst Hurricane Irma does is what happened here after Wilma & Jean—which tore off the roofs of most of the houses, including mine, knocked out cellphones for 7—9 days, sent wired phone lines offline for 11 days (67 in my mom’s case, just 8 miles away), and kept the power off for 9—11 days. Sum it up? Don’t know if a thing created here will ever see the light of day before a new Outlook is prepared a week from Sunday but I can only do what I can do, and that’s create one for this week, especially given a ridiculous # of events this week, again. And here’s the irony of preparing the schedule, as usual: there are so many events in the path of Irma, that a large number of events could be canceled, even if I post!

EIA weekly Crude Oil/Gasoline/Distillate Stats (Harvey & Irma skew #’s)

Won’t if be funny if the ABIA—American Bankers Insurance Ass’n—Annual has to be canceled due to Hurricane Irma? It’s scheduled to start on the 11th, Monday, and promised Flood Insurance/RESPA Official as one of the keynotes.

ISS World on the 11th, is highlighting the "Lawful Interception of VoIP & IP-Enabled Services, NSA Retention, Cyber Threat Detection & Information Sharing. This is a group the got involved with BlackBerry when some countries decided its e-mail system wads too secure, so its devices should be banned. ISS Represents the law’s point of view.

Delivering Alpha is co-hosted by CNBC & Institutional Investor, the former sure to have it dominate its schedule on the 12th. That’s also the day GS will explain why FICC collapsed by (-40.0)% last Qtr, y/o/y speaking at Barclays FinServices Conference, and also be the day Chipolte (CMG) Mexican Grill takes its Queso nationwide after a regional test just long enough to create the max buzz.

CAT Investor Day on the 12th, probably makes moot CAT’s appearance at Morgan Stanley’s 5th Annual Laguna (CA) Conference, the following day, as well as at RBC’s Global Industrials 2 days later, on the 14th.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

\September 04—08, 2017   HOUSTON’S RECOVERY WILL BE ON EVERYONE’S MIND   Harvey’s toll could be felt this week. Piper Jaffray European Energy, though scheduled for 8/29—31 in Perthshire Scotland was canceled because Texas airports were closed, keeping executives from flying out, if they weren’t out before Hurricane Harvey hit. And even when they were, they preferred to stay back to help with the recovery, and keep abreast of the restarts & recovery of pipelines, refineries, and chemical plants, if not the drilling rigs, themselves. That could happen, as well, to Platt’s Pipeline Development & Expansion planned for Houston on the 7th. Not that the waters won’t have receded but it’s hard to imagine the city getting back to business that fast, with a 3-day holiday between now and then.

Yet, it’s the recovery from Harvey we’ll all be watching. I tend to list events in the order of expected importance. I.e. BAC/MER will draw more people to a NY conference than, say, Wolfe Research does. But in the case of Sept 6th, I gave KBW Insurance Conference (Boston thru 7th) precedence over UBS Global Chemicals, Paper & Packaging Conference (NY thru 7th), because the question on everyone’s mind is how much Harvey is going to cost insurers—even if it seems the biggest cost will be for vehicles totaled in the floods. I happen to have a FEMA flood policy, and find myself extremely bothered by its habit of bailing out people who never, once, paid for a policy. We’ll see if that happens after Harvey, as well.

The Earnings Calendar winds down, while the Economic Calendar is decidedly light, leaving Events to star. And even with potential cancellations, the Event Calendar is simply insane this week—Wednesday and Thursday, in particular. Where firms could host conferences stateside they loaded the boat in the Far East & Europe.

One item to note, especially, is that T-3 settlement is, now, being replaced by T-2, which means paying for purchases one day sooner, or getting funds from a sale a day sooner, also. The change starts at of Tuesday, the first day back, when Congress will return from summer Recess, also. Wall Street consensus assumes raising the debt ceiling and passing billions in funds for Houston, post Harvey, will go more smoothly, because Congress needs to help the 4th largest city in the country recuperate. Other than that, I find the number of events scheduled for this week simply insane. No human can possibly absorb all the webcasts on tap, if they were to try. Then again, the crowds never return from summer vacation immediately after Labor Day, as the schedule presumes. In fact, more commonly, CNBC’s Pisani often bemoans the lack of volume during the week following Labor Day. Well, no one but him predicted busier markets before the holiday, so he’ll be most disappointed that it doesn’t materialize. I prefer a slow ramp up from a vacation weekend, getting my sea legs steadied with an eye on the US Open.

Welcome back!

ECONOMIC: (Highlights, only, below. The Full International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.  

August 28—Sept 1st, 2017 
SLOW CRAWL TO A HOLIDAY WEEKEND   This week could be the slowest crawl to a holiday weekend, with the August Unemployment Report worth about 10 minutes trade Friday morning. Before that several 2ndlooks of previously released data, and I-banks concentrating their conferences overseas, where this coming weekend isn’t a holiday. End of month data arriving on Friday, the first of the new month and in such a slow week, otherwise, doesn’t always occur. But the BLS is getting the data out, as are OEM’s, releasing the August sales of new vehicles, all Friday.

Because Janet Yellen referred to the financial crisis timeline being available at the St. Louis Fed, I became curious about when the timeline ends, if it did, and what it includes, or excluded. For other curious souls, it ends in 2011, and can be found here:
https://www.stlouisfed.org/financial-crisis/full-timeline

Fed Reserve of Chicago Large-Bank Directors Conference is flush with corporate board members, including from: BBT, CMA, CIT, Mitsubishi UFJ Financial, Fifth Third Financial Corp, SCHW, BNPP, DFS, SAN, STI, USB, HBAN, as of this post.

Of all the companies reporting this week, and there are few of them, to be sure, Best Buy could attract some of the most curious, since it’s defied expectations, holding stock gains, despite JCP moving into Appliances, and Amazon expected to do the same. Those analysts who tout the Geek Squad has, probably, never used it for anything, or they’d know how few of the Geeks know a thing about anything computer related. And while it is one of the retailers likely getting a fair share of Switch consoles from Nintendo. As GameStop’s Friday earnings proved, that’s not necessarily enough to hold up a stock.

OF the week’s events, Morgan Stanley’s Houston Energy Summit, obviously, won’t take place; that city is underwater. That leaves Jefferies’ Semis, Hardware & Communications Infrastructure summit to lead the pack stateside. But that’s also a group that hasn’t needed Jefferies help to rise. I’m notably disappointed by the new films offered at the movies, for the coming holiday weekend, making the US Open, in Flushing Meadow Park, the best alternative. If you grab a Broadway Show ticket at the TKTS booth in Times Square, don’t be disappointed if the leads are all substituted by stand-ins for the weekend. Just like you and me, stars of Broadway get invited to out of town weddings and take a few days off over holidays. If you pay $140 for a Broadway ticket and expect to see the regular stars, fhegheddaboudfit when it comes to Broadway Shows on both Labor Day & Memorial Day weekends

And with that, we’ll leave you with the slim schedule, and a warning that we may not post a regular Outlook next week because we have a tax return to complete, and because, the post-Labor Day schedule is so busy, it’s barely possible to list all the events, let alone anything else.

Have a happy, safe, holiday.

ECONOMIC:  (Highlights, only, below. Full Int'l Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s alone, and should be just one factor in more complete due diligence.

August 21—25, 2017  
VOLUME LIKELY TO DRY UP   While most of us would prefer to hear less of Pres. Trump, he’s scheduled a 9pm (et) Monday national address to tell us what he decided to do with Afghanistan—a long running war that Obama intended to end but never did. Let’s hope he doesn’t engage in a Q&A because that’s when he’s at his worst. Speaking of low volume, Monday should be the worst of all, as the solar eclipse becomes the most hyped event in history. Funny thing about it is I remember the last one, and can’t remember it being as hyped as this one is. If you miss this one, there’s another in 2024, anyway. Those who were expecting a correction coincident with the solar eclipse might, instead, find stocks making a bottom on Monday, though my view of the charts I’ve looked at suggests there’s likely to be more losses before a bottom is put in. In fact, it’s been a long time since so many charts looked so unappetizing to anyone but shorts.

US Data this week will includes, Tuesday, FHFA’s June & Q2 House Price Index, and July New Home Sales on Wednesday. Then Thursday, July Existing Home Sales will be released

The big Economic event of the week is the Kansas City Fed’s Annual Economic Symposium in Jackson Hole. Yellen speaks Friday at 10am et, and Draghi during lunch, Friday, too. Those anticipating Draghi signaling a coming end to the ECB’s QE may well be very disappointed. Why would he go to Jackson Hole to preview future ECB moves, when he could speak in any of the 28 EU countries, if he wanted to deliver that message. The symposium theme is "Fostering a Dynamic Global Economy," and that’s what he’ll stick to, even as Yellen plans to speak on financial stability. The full agenda will not be published until the 26th, so I can’t tell you who else is scheduled to speak or their topics. Yellen’s schedule is published by the Federal Reserve, and Draghi’s by the ECB. And even then, one has to convert GMT to local time, to figure it out. Assuming lunch is around noon or 12:30pm, then Draghi’s speech will be sometime after 2pm on the east coast.

The Earnings Calendar promises more retailers, not all of whom are emboldened, this week. But in addition to the retailers, Medtronic, Sanderson Farms, Autodesk, Broadcom, Intuit, JM Smucker and Hormel, in addition to Royal Bank of Canada and Salesforce.com --just some of the other names beyond Retailers, while Ulta Salon, on Thursday afternoon, is one I’ve been waiting to see fail to grow at the outstanding rates it’s posted over the last few years.

As for Events, note Interventional Cardiology finishing up as I type, Sunday, along with an Intensive Review of Cardiology that will run though Wednesday. Meanwhile, The European Society of Cardiology opens next Saturday, in Barcelona, which combined with Medtronic’s earnings release, Tuesday morning, is a plethora of cardiology discussions, for a single week. Hot Chips, starting Monday, and Autonomous Cars, Tuesday, caught my attention, Monday & Tuesday, respectively.

But note, I doubt any event this week will supplant the attention the K.C. Fed Symposium will attract. There will be at least a dozen economists from I-banks, and dozens more reporters who will discuss what they expect, and few of them will have more than speculation to back up their commentary. But the Fed is known to whisper in ears selectively, so it’s probably foolish to dismiss everything written, out of hand. The Fed speakers talking recently included one who’s comment made sense; when he said the debt ceiling is likely to influence when the FOMC begins to unwind its balance sheet--sooner rather than later. I can’t find in my daily notes who it was who said it but I think it was Kashkari, and that makes tremendous sense to me. Because the Fed turns over to the central government its excess earnings, and the cash it will receive from selling its treasuries & agency debt, it makes sense to me that the start of the unwind will begin in Oct., sooner after the FOMC meeting that ends 9/20. If you don’t think the Street is really properly prepared for unwind, then you probably want to buy some puts on the next rally—or maybe not even wait for the "next" rally.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence. 
  

August 14—18, 2017  
 NOT QUITE ALL, RETAIL ALL THE TIME      Because Retailers big and small dominate the Earnings Calendar, it may feel like All RETAIL, All the Time but that won’t really be the case. In fact, there are a few tech heavy hitters reporting earnings, this week, including NetApp, Synopsys, Cisco, Alibaba, Applied Materials, heavy equipment manufacturer Deere & Co, along with defense contractor Caci. Can Deere do what Caterpillar did with its recent Quarterly report? Run to the upside as if it was the last bargain stock in the world?

But Retail is not just a feature on the Earnings Calendar, because we’ll also hear about July US Retail Sales, on Tuesday, US Q2 (p) eCommerce Sales, on Thursday, and, even, UK July Retail Sales in the wee hours of Thursday morning, while we’ll hear about China’s July Retail Sales, overnight Sunday, shortly after I post. Other items of interest on the Economic Calendar, apart from global retail sales, includes a very light US Treasury issuance calendar, that ends on Tuesday, with $20B of 52-week bills offered. Housing peppers the Economic Calendar, with the NAHB (Homebuilders) Aug. Housing Market Index released Tuesday, US July Housing Starts/Building Permits, on Wednesday, China’s July Property & House Prices on Thursday, with Canada’s July Existing Home Sales, for that matter, out Tuesday, too. Some Canadian provinces have tightened requirements for home purchases, and/or enacted taxes on home sales, to slow the foreign—particularly Chinese—money that was looking to hide out in Canadian property, despite China’s attempt to clamp down on currency outflows. Chinese inflows to Canada were boosting home prices to sometimes overinflated heights, now cooled with new taxes, as Sunday nigh/early Monday’s Teranet/National Bank July Canada Home Price Index is likely to show for another consecutive month. .

In addition to Retailers big and small reporting earnings, this week, Target (Wed. a.m.) & Walmart (Thurs. a.m.), the largest of them, TJ Maxx (Tues. a.m.) & Ross Dress for Less Stores (Thurs. p.m.), the ones expected to please the most, there’s also L Brands (Wed. p.m.) the newest member of the naughty list, after discontinuing swim & apparel at Victoria’s Secret, last year, posting declining comp store sales this year, as a result. and GAP Stores (Thurs. p.m.), for some a newly designated "safe play" in retail, for outperformance at Old Navy, and its worst performing division—Banana Republic—also its smallest. Then, again, anyone who thinks of GAP Stores as safe, hasn’t noticed that shoppers no longer flood its namesake when merchandise is 40% off, or more, not even when there’s an added, Sales Tax Holiday, to reduce prices by another 5—8%, as there was in several states on August 4th—7th.

In addition to retail earnings, one of the largest events of the week will be MAGIC, the massive apparel expo so large it nudged World Shoe to join its show in Las Vegas, instead of holding its own, on other days. And while they were at it, MAGIC managed to get the PGA to move its merchandise show to concurrent dates with MAGIC, in Las Vegas, too, even as NSRA for shoe retailers moved its education conference to MAGIC, as did Apparel Sourcing Summit, and Off-Price Apparel Show, to some, thought of as the competitors. So, as long as so many manufacturers and retailers will be in Las Vegas, Citi, Wolfe Research and other investment houses will be setting up shop, hosting clients, and sometimes, manufacturers at dinners with clients. There’s one competitor that hasn’t, yet, caught the ‘join MAGIC’ bug: eTail East will take place this week but in Boston, not Las Vegas, ironically, starting the day Amazon hosts its AWS Summit, in New York—AWS, no doubt, a host for numerous eTail participants.

Aside from retail & apparel, EnerCom, The Oil & Gas Conference starts in Denver, Sunday, as I post. Like MAGIC, there are a few I-banks planning on doing hosting duties at EnerCom, including the 2 that will set up shop at MAGIC. The I-banks will host clients and Oil & Gas presenters, over drinks, coffee, dinner, and breakfast. Leerink will be busy with small healthcare events, Ribs ‘n Bones on Memphis, Monday, and on Tuesday, ‘Heart of Health Care Facilities" in Nashville. D.A. Davidson is hosting Technology, Tuesday, Wedbush PacGrow Healthcare, in NY.

Note ASRA, for Retina Specialists, which started Saturday, because Regeneron & Eylea, for wet age-related macular degeneration (AMD) could be the stars, again. What few casual observers and, even, some traders don’t know is that Eylea is, also, approved as a treatment for metastatic colorectal cancer, under the brand name Zaltrap—perhaps one of the strangest dual use drugs in medical history. .

Piper Jaffray’s Global Agriculture Symposium, Nomura/Instinet’s media, Internet & Telecom/Communications Conference, UBS’ Genomics 2.0 Summit, and Citi’s Insurance & Asset Managers Forum, all starting Monday, highlight a mini flurry of I-bank events, before the summer lull returns until right after Labor Day. Also notable, Citi’s 1-1 MLP/Midstream Infrastructure Conference, RBC’s Restaurants & Consumer Staples, Raymond James’ Park City TMT Summit, OpCo’s Boston Oncology Insight Summit, Stephens’ Southeast Bank Field Trip, and OpCo’s Midwest Corporate Access Day all start—and in some cases, also, end—Wednesday. Note how loosely RBC uses the term "consumer Staples;" Johnson & Johnson is presenting there. Agnico-Eagle Mines Ltd and Equifax, on the other hand, have scheduled traveling investor days, bringing their IR & other Execs to clients, instead of clients coming to their Hdqtrs or an I-bank auditorium.

Pebble Beach Concours d’Elegance, part of a weekend of classic car auctions, often offers a good read on how optimistic the 1.0% are. Then, again, LABACE, for Latin American Business Aviation probably won’t be as buoyant as similar Expos are in other areas of the world. Between Brazil’s recession and bribery trails, and Argentina’s political turmoil, that’s 2 big countries probably not ordering too many business jets, this year.

And if none of the above gets your attention, we have 2 other tidbits. Tuesday is the deadline to request a redemption from a hedge fund, whose Quarter ends September 30th, if the fund requires 45 days notice. Also, Wednesday, the FOMC will public the Minutes of its July 25—26th Meeting. Since there was no press conference after the July Meeting, and many expect the balance sheet unwind to begin next month, it’s quite possible the July Minutes will be more specific than FOMC members have been, Yellen included, hinting that "very soon" means September. Furthermore, NY Fed Pres. Dudley gave 2 speeches that led the Street to believe there won’t be any rate hikes while the balance sheet unwind gets underway, at least not initially. Should Yellen and other members of the FOMC have discussed that notion, and decided that the Street is misleading itself, that topic could, well, turn up in the minutes. Any suspicion that Yellen prefers waiting for meetings with press conferences to get more specific could well be unfounded, as we may find out Wednesday. On the other hand, Kashkari and a couple of other FOMC voters want inflation to get closer to the FOMC’s 2.0% target, before any more rate increases are announced. The Minutes are where support or dissent from that desire could well be a highlight of the minutes. Kashkari, of course, did NOT dissent against the June rate hike but has spoken explicitly against additional hikes while inflation remains so far below the FOMC target.

All in, with Retail so prominent on this week’s schedule, the problem children of the S&P are front and center, which may make it that much harder for stocks to recover the rest of the ground lost, last Thursday. In fact, while Target upsided, there’s a lot riding on Walmart and Home Depot (Tues.) to perform, and even some pressure on Target to deliver the upside promised, and probably a little more to really please. The bulls have their work cut out for them, this week. Some downside protection and cash couldn’t hurt, especially with a Pres. bullying a madman in North Korea, both of them used to getting their way. Trump’s pissing fight makes me extremely uncomfortable. How bout you?

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s alone, and should be just one factor in most complete due diligence.
 

August 07—11, 2017   RETAILERS’ EARNINGS FRONT & CENTER    Monday, the important data will be June Consumer Credit (Debt, really), not out until 3pm et. Even during the Sales Tax Holiday that was held on the just ending weekend the malls didn’t seem particularly popular. Then, in Florida, there wasn’t much expected. Clothing & shoes were capped at $60 in cost to qualify for the sales tax holiday, and it’s quite tough to find even sneakers for that little. Some retailers, like Journeys (GCO) and Nordstrom (JWN), offered discounts that allowed some sneakers to qualify by a penny but, even then, the selection was limited. So, if consumers didn’t boost their revolving credit, it won’t surprise me. The malls have become the setting for out of town visitors to scoop up bargains but sparse for locals.

Also this week, Q2 Productivity & Costs, AWOL productivity the mystery Bernanke & Yellen have puzzled over. Wed, the Treasury will auction off 10-year notes, then on Thursday, 30-year Bonds though NY Fed’s Dudley speaking that day probably will be key. Notable on Thursday, also, are earnings reports expected from Brinker & DinEquity, as well as Kohl’s, Macy*s, and Nordstrom, along with News Corp, nVidia, and Snap Inc, before JCPenney wraps up the bigger department store reports on Friday. Otherwise, a week heavy with the volume of reports promised few companies to highlight. And that’s because most of the heavy hitters have already weighed in, outside retailers, a reason for a flutter of investment bank events scheduled during this week, after a few weeks in which they were all but non-existent on our shores.

Because there haven’t been many investment bank sponsored conferences June, the large handful of I-bank events all stand out this week. KeyBanc started Sunday, with an event that began as a Pacific Crest Global Technology Leadership Forum that has survived Key’s takeover of PacCrest. Monday, Wells Fargo hosts Technology Services, Jefferies Industrials, and Cowen & Co Communications Infrastructure, though Inman’s Real Estate Connect, about online real estate services, even as Realogy has scheduled an analyst meeting.

Tuesday, UBS hosts Financial Services, and JPMorgan Auto, even as Avondale Partners is hosting its 5th Annual Healthcare Conference, and OpCo its 20th Technology, Internet & Communications Conference. Citi is hosting meeting at the Flash Memory Summit in Santa Clara, California. On Wednesday, Deutsche Bank is hosting an Internet Conference in Palo Alto, while CanaccordGenuity is hosting its 37th Annual Growth Conference, in Boston. Neither of those events will out shine STR’s Hotel Data Conference, in Nashville. STR is Smith’s Travel Research, exactly why I expect it to outshine the 2 I-bank events, especially given how hot data is, these days. If Goldman Sachs is repeating last years Power, Utilities, MLP & Pipeline Conference on the 10th, PS&G is the only company we could find participating.

So with I-banks hosting companies too early in the quarter for warnings, and probably too early for upside comments, either, that leaves data and the earnings calendar to sway stocks and bonds, with reports from the department stores, this week, leaving only one question: Are expectations low enough? And which names can surpass low expectations? Probably not Macy*s, new CEO or not. Kohl’s? Not a store I visit regularly, because no one asks. And that’s part of Kohl’s problem, PM’s aren’t particularly interested in retailers, at all, and not in KSS in particular. For my part, I don’t understand getting an extra 15% off purchases, plus $10 in Kohl’s cash for every $50 spent, albeit no redeemable at time of the purchase that generated the $10 coupon. And, then, if you open a Kohl’s charge card, you can get 30% off that day. L Brands is now touting discounts the day an Angel card is opened. And rather than get its wrist slapped for discounting Under Armour athleisure, KSS doesn’t advertise the brand, at all. And that’s a surprise because Dicks, which opened here recently, has no trouble advertising Under Armour at anywhere from 25—50% off. But, then, discounts are the ways of the mall, in general, with some as steep as 80% off, like Macy*s clearance shoes & "Last Cut" merchandise. As a former retailer who it pained to discount as much as 50%, to clear out winter season ski wear just as spring swim & tennis wear was arriving, 80% if a discount I don’t understand because it sounds dishonest. A retailer who can discount 80% probably is marking up their merchandise well above Keystone to begin with, allocating room for the first 20 or 30% off in the alleged "retail" price. And that’s why Macy*s is being sued in 3 states, JCP in at least one, and other department stores in many of the same states. Which begs the question: Are stocks jacked up to allow for the first pullback to hurt most traders not at all?

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s alone, and should be just one factor in more complete due diligence. 
     

July 31—August 04, 2017   A SLUG of EARNINGS REPORTS WON’T BE THE MAIN DRIVER   It’ll be another busy week for earnings but I don’t think they’ll drive the major averages to the extent such a large quantity might, otherwise, be expected to. With July ending Monday, and the July Unemployment Report out Friday, it’s the big picture, more than the granular that will drive stocks. For all the volume of earnings reports expected, there were just a handful of tickers that seemed worthy of emboldening, Apple on Tuesday afternoon, among them. There are times the market likes to see the sunshine and other times it doesn’t believe there’ll ever be another sun shining day. At the moment, the market prefers to believe there’s a near perfect world driving stocks to ever greater new all time highs, despite a totally dysfunctional White House, and a President who issues policy via Twitter.

With June Pending Home Sales out Monday, July Motor Vehicle sales out Tuesday, along wit5h June Personal Income & Outlays, and both the PMI & ISM July Manufacturing Index, before Wednesday’s ADP’s mostly useless monthly private sector Unemployment Report, and Thursday’s Challenger Lay-off Report, and Monthly & Quarterly sales reports from a few more than a handful of retailers. And it could be the BoE’s meeting, and Carney’s early Thursday morning press conference that provides more food fore thought to stocks than the earnings calendar.

As for the Events Calendar, there’s very little there. CAR, or the Center for Automotive Research Management Briefings started Sunday, in Traverse City Michigan. Tuesday, Wells Fargo hosts Biotech Access Day in Boston, before moving the shebang to San Francisco, on Thursday. BKW hosts Community Bank Investors, Tuesday, also. One of the bigger events will be Credit Suisse’s 11th Midsummer Annual LatAm Conference, in New York, starting Wednesday. Besides Wells, Thursday brings Needham & Co’s Annual Industrial Technologies 1x1 Conference, and UBS Transports, also Thursday, on the eve of some 14 states offering a weekend of Back to School sales tax holidays, over next weekend. The majority are from Friday through Sunday, the amount that’s tax free varying by each state, Florida, once again, one of the cheapest states, even as its 10 day holiday has been shortened to 3 days. And that’s probably for the better, since people are procrastinators and wait until the last minute, no matter how many days are set aside for the holiday.

It’s been crazy to bet against this market but equally crazy to keep making bets on more upside. Still, the latter has been the right side of the markets, with little reason to hold back now. Perhaps there’ll be something in the FOMC Minutes, mid-month but for now, the strength of the upside is powerful.

ECONOMIC: (Highlights, only, below. Complete International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.  

July 24—28, 2017   EARNINGS, NOT FOMC WILL SWAY    By the end of this week, the Wednesday FOMC statement may well be forgotten, as the deluge of Earnings reports dominate the conversation. While some big tech names will report, including Google parent Alphabet, and Facebook, each day of the week stands out for the smallish number of tickers highlighted, as a percentage of total reports. Wednesday and Thursday stand out for me, because of the disproportionate number of miners, homebuilders, airlines, and casinos slated to report. Then, again, Tuesday promises 3M, Biogen Idec, Caterpillar, Domino’s Pizza, McDonald’s, Newmont Mining, Pulte Homes, Seagate Tech, AMD, Akamai, Amgen, AT&T, Chipotle, Chubb Group, Juniper Networks, Robert Half, Texas Instruments, US Steel, United Technologies, and Wynn Resorts. And Friday, American Airlines, Baker Hughes--GE, Barclays, Chevron, ExxonMobile, Credit Suisse, Merck, Nomura, and Weyerhaeuser, and I haven’t even scratched the surface.

On July 24th, the oil Ministerial Monitoring Committee meeting, supposedly, will try to get Nigeria, Libya, & Iran to agree to some production cuts, after they were exempted since the Jan 1st start of the production suppression, and as Ecuador abandoned participation, claiming need for the funds the crude sales provide. Back in May, Saudi Oil Minister Khalid Al-Falih said the Saudis could cut deeper, to offset some production ceiling on the 3, currently exempted, countries. But it appears US Shale production has quickly offset Saudi/OPEC production cuts, not doing much for crude prices, after all. That’s one meeting that may offer a wild card but, even then, crude doesn’t, necessarily, respond in the way the Saudi’s hope. Most recently, the Saudi’s have been cutting exports to the US, not that we really need them.

A quick glance down the Events Calendar reveals how few investment bank events are scheduled. That’s deference to both summer and the earnings season, with this week and the next 2 the heaviest of the quarter. As for industry events, it’s once again, medical/healthcare related meetings that dominate a much smaller than usual calendar. Seeing lots of ads for Gardisil
? Thank the Int’l IAS—AIDS & HIV Prevention & Treatment 2017 Conference (starts Sunday, 7/23). It sounds crazy but parents choosing to inoculate their 10—12 year old kids, before they become sexually active, can protect them from ever falling victim to sexually transmitted diseases but, still, it’s a hard sell to parents who think their kids are too young. And it turns out, it’s newly single seniors who may need more convincing.

But let’s list the health-related events besides AIDS/HIV, which includes Dental, Orthopaedic Society for Sports Medicine, World Congress of Gerontology & Geriatrics, Veterinary Medical Ass’n, Molecular Biology, Molecular Biology in Clinical Oncology, MedAssets, Industrial Biotech, Echocardiographic symposium, Academy of Dermatology, Int’l Lung Cancer, Podiatrists, Best of ASCO, Laparoscopic Anatomy & Minimally Invasive Surgery, AACR/ASCO Methods in Clinical Cancer Research, Nat’l medical Association, Society of Nuclear Medicine & Molecular Imaging. Take out all of those, and we’re left with a couple of Automotive events, in Detroit.

Then, there’s the Economic Calendar. We acknowledge the testimony Jared Kushner & 1st son, Donald Trump Jr will offer to Congress but both will happen behind closed doors. What stands out, otherwise, is a surfeit of housing data, including Monday’s June Existing Home Sales, Tuesday’s FHFA May House Price Index, as well as the S&P/CoreLogic CaseShiller 20-city May House Price Index, before Wednesday’s June New Home Sales. Wednesday, at 2pm, the FOMC will release its post-meeting statement but, so what? The Street is on board with a September start to the balance sheet unwind, and feels fairly certain the FOMC will hold off on rate hikes until December, under that circumstance. At least 3 FOMC voters have come out, vocally, in favor of waiting to see whether inflation rises, again, before more hikes are added to those already passed. And whether it’s done automatically in the background or discussed ad nauseum, the unwinding of the balance sheet will be tightening credit, no matter how it’s intended. And at least one problem has arisen—a TIPS auction that was, for all intents and purposes, a fail, because there is no inflation in sight. That will focus more interest on Tuesday’s $26B 2-year Notes auction. Surely, floating rate notes are a better hedge against inflation that hasn’t made itself felt or seen. Not to diss the BoJ but its best attempts to boost the Japanese economy hasn’t worked since the 1990’s bubble burst. I can’t imagine there’s much to be gleaned from its Minutes of its June meeting, out overnight Monday, into our Tuesday morning.

I would not be surprised if the market merely marks time, from here. Obviously, Alphabet & Facebook earnings will influence tech but, then, I could say that about Amgen & Celgene, as well, both reporting this week. Granted, stocks may avoid the dip they usually take in this, the third week of the earnings season, thanks to stronger the year ago reports, perhaps even a benefit from the post-Trump election sentiment that was a bit ebullient for awhile. Then, again, I have no reason to believe the next leg up in stocks will start this week. The Street has a problem processing the amount of information scheduled for release this week. But if you’re a bettor, perhaps bet for the next leg up after the next three weeks of earnings reports are done.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.
   

July 17—21, 2017 
EARNINGS SHIFT INTO 2nd GEAR     Both the BoJ & ECB meet this week, summing the global focus, just as US Earnings Season shifts into 2nd gear. The UK & EU Brexit negotiators hold their second meeting, Monday. Can’t imagine they’re going to continue to meet once a month, for a single day, and hammer out a divorce in the 2 years allotted for such discussions & deals. In the meantime, the Economic Calendar promises updated data from both China & the UK, the latter starting to suffer the effects of Brexit uncertainty, the former key to continued growth in economies around the world, including the US. China will release Q2 GDP before US markets open Monday, along with June Retail Sales, Industrial Production & Fixed Asset Investments.

In the US, the Economic Calendar is dominated by housing data, even as the builders broke out to new highs, last week. Tuesday, the Homebuilders July Housing Market Index is a sentiment index, that is predictive of very little. But Wednesday’s June Housing Starts & Building Permits, is hard data subject to revisions, of course. Wednesday will prove important for the BoJ Meeting, and Kuroda’s post-Meeting press conference, followed by hours with an ECB post-meeting statement, and Mario Draghi’s Press Conference late enough Thursday morning for US early birds to catch it before the market opens—before most of the earnings to be released will hit. The statements & press conferences will occur on the 20th, in local time, overnight Wednesday, into US Thursday morning. And then, anyone looking ahead will duly note the upcoming FOMC meeting, on July 25—26. Nothing is expected out of that meeting, except, perhaps, firmer guidance on the start of balance sheet unwinding.

The Earnings is still heavily populated by major financial companies. On Monday, BlackRock, on Tuesday Bk of America, Goldman Sachs, and TD Ameritrade. Wednesday, Morgan Stanley, American Express, and for that matter, if we drill beyond the tickers highlighted, Northern Trust, and US Bank, along with American Express, Bk of New York Mellon, Blackstone, Keybanc, Capital One Financial, Citizens Financial, Visa, Huntington Bank Corp, Regions Financial, SunTrust, Synchrony Financial, and insurers Travelers & Progressive, E Trade Financial, and one day this week, Charles Schwab, too. And that’s without the many other, smaller financial companies on a schedule we omit, because they’re not our universe of corporates—we concentrate on the major money center banks & largest regionals. .

No surprise, in deference to analysts keeping track of earnings and commentary on conference calls, there is a slowdown in investment bank events in the US. For the next 3 weeks, there’s a slowdown worldwide but that doesn’t stop certain industries from hosting their own general or annual meetings, or in the case of the AGA (American Gas Association), a meeting to plan the 2018 meeting. No doubt, the calendar matters not to the Alzheimer’s Association, or the World Congress on Heart Disease. For some, it’s not a convention or "congress" but Time Warner’s HBO launching the 7th season of "Game of Thrones" Sunday, as I write, that means the most, this week. Anyone wonder what Netflix streaming looked like as GoT season 7 streamed?

Healthcare dominates the events, this week, from Controlled Release Bioactive Materials, in Boston, to SMA Focus on the Female Patient, the Int’l Spine Intervention Society, Congress on Mucosal Immunology in Health & Disease, and AOSSM: the American Orthopaedic Society for Sports Medicine Annual Meeting, Congress on the Future of Breast Cancer, National Dental Association, Veterinary Medical Association, and Intelligent Systems for Molecular Biology, co-located with the Conference on Computational Biology, both in Prague, Czech Republic, the only one so far away. I quickly glanced at UBER Java, scratching my head before I read up on the "About" and FAQ and realized it means "SuperJava" and has nothing to do with ride sharing.

Strip away all those health-related events, and the Events Calendar collapses to barely a handful of events. NARUC, for Utilities Regulators, CHART, a Hospitality Training event, and GBTA—Global Business Travel Professionals. ASABE for Agricultural & Biological Engineering has, on occasion, brought negative press for Bayer, Pioneer and Monsanto. Typical, was a Friday Wall Street Journal article about chemical drift that farmers claim are destroying their crops. The PAYMENTS Institute has lost attendees to whatever Blockchain event is scheduled next. Casino Marketing & Technology Summit, a Vegas event, even as some analysts are calling a top in Macau. NAED, for Electrical Distributors has often brought news to companies like Arrow and Grainger but with Grainger reporting, after twice warning during the quarter, it’s earnings that will rule.

And it’s Earnings that traders need to focus on. With strong bank earnings failing to overcome more caution about the current Qtr, equities enter the 2nd week of Earnings on shaky ground, just as the deluge of reports buries everyone with information overload. Often, stocks back off or, at best, consolidate recent gains for the next few weeks, before rising again, on an earnings season not nearly as bad as some feared. Make no mistake: the next few weeks are, typically, more volatile than they’ve been for the past year. And often, a week or two of strength into August has sometimes been the opportunity to get out of longs, before a deeper pullback materializes. No one ever got fired for taking profits. What’s keeping a lot of traders from doing so is, first, hopes that tax reform gets passed, and not qualifying for the benefits if stocks are sold now. The other issue some have about taking profits is where to put the money they’ll get from selling. That is a particularly sticky wicket, because stocks are expensive.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone,’ and should be just one factor in more complete due diligence.
 
     

July 10—14, 2017  YELLEN & BANK EARNINGS    Expect bank earnings, Friday, to really determine the tone of Q2 earnings season. Some will be waiting for Yellen’s congressional testimony, Wednesday & Thursday but with the monetary report already released, last Friday, and the recent minutes of the last FOMC Meeting laying out in detail plans for unwinding the Fed’s balance sheet, I just don’t see what the suspense is about Yellen’s testimony. Worse, if she happens to misspeak on Wednesday, she can always shade her comments on Thursday. And, in line with the normalization of the Fed’s balance sheet, there’s a joint NY Fed/Columbia Univ. School of Int’l Public Affairs event, Tuesday, with Fed Gov. Brainard & the NY Fed’s chief trader, Simon Potter, on "Normalizing Central Banks’ Balance Sheets; What is the New Normal?"

I think we can all reasonably conclude that CPI Friday, and for that matter, PPI on Thursday, should offer few surprises, given the pressure oil has been exerting on the commodity complex, in recent months. And, while we’re at it, forget all the calendars that claim the ECB is meeting this week. That’s untrue. It meets on July 20th. End of discussion, no matter that Barron’s is among those that say something different.

Two interesting features outside Yellen’s testimony and the major money center bank earnings should be noted: The first is the FDA will be holding 3 days of meetings for advisory committees to discuss and decide on Biologic Licenses, all of them BioSimilars to existing drugs. While there’s been a one-off biosimilar approved, here and there, this week’s 3 days of meetings to determine the likely fate of several biosimilars may prove a watershed moment.

Also of note, on July 13th, just 2 days after Amazon Prime Day, all unauthorized sellers of Nike products must take their Nike listings down, or AMZN will remove them. I’m not a lawyer, but I come from a family of lawyers and, unless those unauthorized dealers are selling counterfeit or stolen products, AMZN has no right to restrain trade, and insist they remove the listings, to benefit the AMZN/NKE relationship. This issue, to me, is the most exciting development in what’s been, until now, the most one-sided, dominant and feared company on the planet for retailers & manufacturers, alike. Come 7/13, I say stay tuned!

Who’s big idea is it to run Back To School ads 3 days after July 4th? Even Florida, which used to start the school year earliest in the country isn’t starting until 2 weeks prior to Labor Day, as dictated by state law enacted about 4 years ago. But really, Office Depot, Office Max, Staples & Target? Back to School circulars on July 8th? Could the3y at least wait until Wimbledon finishes? Maybe this is contributing to slow traffic at the mall. Stores are so deeply out of synch with consumers, no one is paying attention at all. for Many northerners, especially, their kids have been away at camp all of a week before these foolish stores started pushing pens, paper, and back packs. They’ll do the same for Halloween, putting up stretched out gauzy webs by Labor Day, giving no one time to make the adjustment they must from one season to another. And especially since, I suspect, the motivation for the B-T-S ads is to combat Amazons Prime Day deals that will be offered from 10pm Monday through Tuesday. If it were me, I’d be advertising that it’s too early to think about BTS and, instead, invite shoppers in for great deals on swim wear, shorts, and B-B-Q Grills. Trying to match Prime Day deals 1-for-1 is simply foolhardy.

Lastly, next Friday’s World Congress of Heart Disease & the Alzheimer’s Ass’n Int’l Conference should draw a lot of comment in the lead up. Alzheimer’s is the heart break disease no one has been able to crack, yet. Now, some are using CRISPR to edit genes in an all new attempt to crack the code but even those researchers believe it’s probably several genes that come into play, and they don’t know which those are.

There’s another event on the calendar that I’m not as positive about: The Allen & Co annual Media Conference will be held before next weekend but the exact days are unknown to me, at this time. SEMICON West should be one of the biggest events of the week, starting Tuesday, if for no other reason than the number of I-banks lining up clients to host at the event. JPMorgan is hosting clients from Japan. I imagine the CIBC & Scotiabank Stampede Energy events in Calgary are somewhat similar: a place I-banks can lead clients around an expo.

For the first time, last week, many groups that were barely doing more than churning suddenly broke out. That action will extend the bull case for a few more weeks, assuming earnings don’t spoil the fun.

ECONOMIC: (Highlights, only, here. Full International Economic Calendar here)  

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.
 

July 03--07, 2017  
WEDNESDAY FOMC MINUTES, FRIDAY UNEMPLOYMENT REPORT. That’s a Wrap   Aside from waiting with baited breath to see if Pres. Trump embarrasses the country, at the G20 Meeting next weekend, the week pivots on the FOMC Minutes to be released Wed. at 2pm, then the June Unemployment Report—which can’t necessarily disappoint unless it’s a wildly large number, which seems unlikely.

June Motor Vehicle Sales no longer count, since both GM & Ford have already prepared the street for weak auto sales, and less strong pick-up trucks & SUVs than earlier this year. Were the June Unemployment to show zero jobs were added last month, the Street would celebrate the second thoughts Yellen & Co would have to entertain. Monday, as you’ve surely noticed, is a toss off day;. Both Equities & bonds close early, and no one will punch in, anyway.

The Earnings & Events Calendar are as slim as they ever get in the last week of the year. Yum China, alone, is the earnings report of interest, Wednesday afternoon. As for Events in the homeland, Macy*s Fireworks display on the East River Tuesday, and the Wimbledon Tennis Championships will dominate the early part of the week. Thursday, the NASH Symposium in Paris could be another chance for Gilead Sciences to flurry higher, for a brief a moment as that flurry may appear. ISPO, the Sports Business Expo used to be in Milan & Munich, Spring & Winter, respectively, but now it’s a Chinese Affair. Go Figure!

I’d sure like to know what fumes the Street is inhaling, that prompts buyers at every turn but I’m just not either smelling or buying it. Not with Earnings Warnings likely to sneak in during a slow week when all the large PM’s are out of town.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)  

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

June 19—23, 2017   BIG WEEK IN SOME UNUSUAL WAYS   Last week I mentioned the index rebalances that took place after the close, last Friday, coincident with Quarterly Futures & Options expiration as a possible contributor to the big tech sell-off a week ago Friday. This week will continue to drive into Friday’s close and the Russell index rebalances, even though FTSE Russell has already signaled changes being made.. But forget, for a moment, Monday’s first trades on the S&P & Nasdaq rebalanced indices, tech selling resuming last week, or even housing data due out this week. The big event of the week is Thursday’s after hours release of the Federal Reserve’s Stress Tests on the 11 biggest banks in the world. Every cycle, there’s been at least one bank singled out to "fail" the test. This year could well be the last annual test, or the last test, altogether. While current regulators would resist the Trump impulse to cancel every regulatory rule the Obama administration pushed through, over 8 years, in the wake of the great recession, they may have their hands tied by new leaders in every agency of government—even heading up the FOMC, if Trump picks someone other than Yellen to replace her when her term is up in February 2018.

Trump has actually been slow to fill all the appointed positions he’s supposed to fill but that doesn’t mean he won’t, ultimately, get down to business now, and appoint the other 1.7K positions he’s yet to fill. Some say the longer he’s in office, the tougher his job of attracting appointees who may not be comfortable with an administration undermined by defensive, middle of the nigh tweets, also beset with the Russia investigation. Forget such rationalizations: Hubris will win out, and Trump will find the appointees he seeks—if he concentrates on it.

Beyond the embarrassment of a single bank being chosen to fail each annual stress test, in the past, there’s a week’s lag before the Capital Adequacy tests—C-CAR—are released a week from Thursday. Those determine how large a dividend and stock buyback any particular bank can execute, so have more direct bearing on bank investors than the stress tests do. Because the results are discussed with the banks before they’re released after the close, a week from Thursday (06/28), some banks will jump the gun and announce how big an increase in the dividend or stock buybacks their board will be asked to bless, early next week. That’s removed a good proportion of the suspense of waiting for CCAR results at 4:30pm on the 28th, and no way to know in advance whether the Fed will have put a stop to the pre-announcements this cycle.

Either way, with reconstituted indices starting to trade on Monday, expect a flurry of activity at the markets’ open, and another wild flurry into Friday’s close. With Stress tests set for release at 4:30pm et, Thursday, there’s really a whole lot more for investors & traders to focus on, as the week wears on, especially given the sudden, renewed interest and inflows into financials, as money left tech. And not to take even more away from tech but the Paris Air Show is in full bloom and, so far, it sounds like business is brisk. It’s almost certain there’ll be nothing concrete out of the UK/EU Brexit talks, as early as this week, though litigating terms through the press is not beyond all possibilities.

What else? Well, the Earnings Calendar is slim, with only about 9 tickers highlighted, albeit, a large percentage of the total number of reports expected, given such a slender calendar. We know to expect some ugliness out of CarMax, given the slide in used car prices, the vast majority of its sales. I don’t have much hope of vast improvement out of Finish Line, Friday, because it’s tied its fate to Macy*s, and we all know how badly that chain is doing. RedHat often pleases more than Oracle, while Synnex has pulled off upside to sales, defying expectations for a number of quarters.

The Events Calendar is stuffed with I-bank events, many of them repeats of events held recently, others duplications within the week. Both Jefferies & Oppenheimer host Consumer Conferences, in Nantucket & Boston, respectively. More of Tuesday’s conferences are overseas, with London hosting Credit Suisse’s Global Chemicals & Agriculture, JPMorgan’s Technology CEO, and Citi’s European Healthcare Conference. Wednesday is one of the heaviest days of the Events Calendar, with SunTrust Robinson Humphreys weighing in with 3 conferences, that day, alone. Nevermind print media will focus on Men’s Couture Fashion Week, in Paris, France, once the Paris Air Show is over. Thursday promises to be busy again, with Wells Fargo’s 5G Forum, JMP Securities’ Financial Services & Real estate Conference, and JPMorgan’s European Healthcare Conference, in London—just one of the duplications cited.

But make no mistake: Rebalanced indices will rule early in the week, and again Thursday afternoon into Friday, even as the bank stress tests will trigger positioning in the banks, before the Fed releases the results at 4:30pm, Thursday. That’s an awful lot to game. The bank at biggest risk of failing the stress tests could be Wells Fargo, again. It’s a way for the Fed to punish it for its fraudulent opening of accounts customers never asked for. And unlike the charges of added services customers never requested that hit CenturyTelecom last week, Wells scandal hurt credit ratings of customers ensnared in Wells’ fraud, which could have lead them to pay higher mortgage, auto loan, or credit card interest rates. Trading volume has been awful, and volatility absent for long stretches, this year. Both will pick up considerably, this week—a week in which I suspect the decline in techs will have proven to be portfolio managers rebalancing their holdings in advance of the index rebalances, into a typically slow summer period which has often had a downside bias before July earnings reports are released.

ECONOMIC: (Full International Economic Calendar here

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.  
  

June 12—16, 2017  HIGH FLYERS USUALLY LAST TANK     Certain signals are developed over decades. One of those for me was always to look for a decline to bottom when the selling finally gets to the strongest, most resilient & reliable stocks. Friday, we saw the opposite, instead. The unrelenting rise in this era’s "Nifty 20," or so, had been so reliably strong it caused VIX to plumb new lows But that all changed Friday, when the biggest winners of the year were unceremoniously and suddenly dumped, wholesale. The weekend press concentrated on the losses in the FAANG stocks plus Microsoft but it was quite a bit more widespread than that. While financials, including property & life insurers, were seeing inflows, Friday, shareholders were dumping Visa & MasterCard. Also tossed overboard, the hoteliers who’d joined FAANG in a non-stoppable rise, Intercontinental (IHG) & Marriott (MAR), to name 2. Throw in Wynn Resorts & Boyd Gaming, plus Royal Caribbean cruises, and while we’re at it, Adobe, Maxim Integrated Devices, Lam Research (LRCX), Activision (ATVI) & Electronic Arts (EA), the latter 2 despite E3—The Electronic Entertainment Expo—opening its doors just hours later. nVdia (NVDA) also got slammed as did Applied Materials (AMAT) and Micron Technology (MU), and Texas Instruments (TXN). So, yes, in pure point terms Amazon (AMZN) & Alphabet’s Google (GOOGL) saw stunning declines, it was really all the big winners that got whacked at the knees. So what should we make of a signal that came at the beginning, rather than the end?

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.  

June 05—09, 2017  PROPS TO ARIANA GRANDE et al   Two weeks after a terror attack at her concert in Manchester UK, and despite another terror attack in London, Saturday night, Ariana Grande and her industry friends put on quite a show on Sunday, not letting terror in London deter the benefit she’d planned for Manchester. Only 21, and caught in immature scenes in the past, Ariana & the other musicians who ignored the threat and, surely, some fear, performed their hearts out, for the people of Manchester. Hats off to them, even as the UK goes to the polls, on Thursday, in what PM May had hoped would be a resounding affirmation of her plans for Brexit but may result in another surprise result.

The US Treasury plans on offering just $72B in short-term bills, this week, not counting the 4-week bills it auctions weekly, the amount of which for this week not yet announced. Otherwise, ISM & PMI non-Manufacturing indices due out, Other than that, the US Economic Calendatr includes some newer markers, like the LMCI—Labor Market Conditions Index, and the Fed’s JOLTS, a measure of workers who quit and job turnover. The thin schedule means the EIA Petroleum stats, and US April Consumer Credit, both on Wednesday, promise elevated attention, until April US Wholesale Trade & the Baker-Hughes Rig Count, both Friday. Overseas is another story, with data from UK, China May FX Reserves, the OECD Eurozone Economic Outlook, and Eurozone Q1 GDP will all be important. Likewise, Japan Q1 GDP, China’s May Trade Balance, and an ECB Monetary Policy Committee Rate Decision and QE Target, one day prior to the UK’s vote, and a week shy of France’s parliamentary elections. Draghi said the Eurozone still needs extraordinary support as recently as last week, so there’s no reason to expect a change of heart, this week. Draghi’s post-meeting press conference will occur prior to US Markets opening on Thursday. .

The Earnings Calendar remains dominated by consumer discretionary names, none of which can move the markets, overall. The Event Calendar, though, picks up considerably, as Investment Banks roll out their last mad rush of conferences before a summer recess. Major events include the NYU International Hospitality Industry Investment Conference, Goldman Sachs’ Lodging, Gaming, Restaurant & Leisure, and NAREIT REITWeek, at which Citi will hold meetings. REITs, you might recall, were granted a new industry category by S&P, last September. That was supposed to make them a hot investment commodity but, instead, REITs are struggled since, as rising rates hurt the attraction of REIT Yields which, at the time they were spun out into an 11th index, were far lower because the stocks had run so much. REITWeek is as much a mass analyst meeting for a single sector, as EPG & EEI were before it.

This week it’s hard to find a group that won’t be covered by an I-bank conference—here or abroad. China is a popular location for conferences, with JPMorgan hosting a China Summit, and several tours of Chinese sectors to round out the post-Summit stay there. BAC/MER hosts its Global Technology Conference in San Francisco, starting Tuesday but you’ll notice some doubling up of sector conferences, including 2 for Automotive related forums, 2 for Global Energy, and other duplications, sometimes on both sides of the Atlantic simultaneously. The puzzler for me is the Baird Global Consumer, Technology & Services. Note, especially, Goldman’s European Financials Conference, Thursday. Last week, US Multinationals pointed out that trading & FICC are slower this year than they were last year, which caused the financials to decline, especially the host of that conference. However, Bk of America, JPMorgan, and Citi have large credit card operations that should have benefited from rates raised in both Dec. 2016 & March of this year. They’ve got a lot more credit card holders whose rates were boosted after both FOMC moves, so the dip in trading tells only one part of a much bigger story for all but Goldman, which has always made its money skimming trades. Apple will host its Worldwide Developers Conference this week, too, though analysts have barely mentioned it, though it starts Monday. Usually, AAPL sticks to the iOS, rather than products at WWDC but Tim Cook has handled it his own way, and one never knows.

In less than two weeks, the FOMC is scheduled to raise rates again, and will likely discuss unwinding its balance sheet more concretely, even if that information doesn’t arrive until the minutes are out 3 weeks after the meeting. Yet, it’s fair to ask why they’re hiking rates, at all, as inflation has dipped over the last 2 months, oil is stuck in a rut that’s so low even high test gasoline is less than $2.90 p/gallon, again. Plus, the consumer is not doing his/her part at all, not at the mall and probably, not as much online, either, this time of year. Even Netflix could find fewer bingers as kids go off to summer camp. So, on the one hand, we have a president making all kinds of promises his party is not, yet, keeping, and his hoped for 3.5% growth clearly out of reach, as auto sales & housing slow—no matter the reason for the latter. Meanwhile, there can’t be any American who’s seen the carnage in London and Manchester and not worry about showing up for an NBA Basketball best of 7 final, or, later this summer, the US Open Tennis Championship.

I started by offering up props for Ariana Grande’s brave performance, and wonder how brave I’d be in the face of so much uncertainty and bloodshed. Someone please tell me what the bulls are smoking, cause I just don’t see it and know this, too, will end badly. But when? That’s the question at the heart of staying in or taking profits and sitting out what may be the last 1—2% of a long running rally. I can’t say I have the answer to the question of when it will be the optimum moment to cash out. I fell one thing very strongly, though: With Major Oil producers slashing their exploration budgets severely, over the last 2 years, there are few big projects under construction. Sooner or later, the lack of investment will make oil more precious than it is, at the moment. And on that score, I do have an opinion about when the deficit will start to dawn on the rest of the market—2019, at the latest. That makes the June Expiration important for something besides Russell Index rebalances—it’s when another out year will be added to LEAPs available—the moment I’m waiting for to capitalize on the imbalance in oil supply and demand I see ahead. Other than that, I’ve got nothing, mostly because I see a rally narrowing to a few, big cap stocks, while the rest of the market falls away in exhaustion. That’s often a sign of a near-term top closing in.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The 0pinions expressed are the author’s, alone, and should be just one factor in ore complete due diligence. 

May 29th—June 2nd, 2017 
RUSSIA PROBE CLOSING IN ON INNER CIRCLE    Short weeks, somehow, always feel like some of the longest weeks of the year, and I suspect this week won’t be any different. Tuesday, S&P Case Shiller’s March 20-City Home Price Index, April Personal Income, Expenditures, and PCE along with the sole Treasury auctions for the week. Also Tuesday, the Conference Board’s version of Consumer Confidence.

Wednesday, the Fed will release its latest Beige Book, which the FOMC is supposed to use to decide whether another rate hike is appropriate but it seems inevitable, no matter what the Beige says. Also Wednesday, NAR’s April Pending Home Sales. Thursday, US May Motor Vehicle Sales which it feels like a disappointment coming—despite tremendous incentives offered across the board—as the flood of TV commercials attest. Also Thursday, May Chain Store Sales, from the 9 that still report those numbers, Challenger’s May Job-cut Report, and ADP’s private sector Employment Report, the usefulness of which remains a big open questions. All of that is the build up to Friday’s May Unemployment Report which could bear some surprises, as interns from graduating classes start filling positions, temporarily, that won’t be filled more permanently, until the fall. In fact, that’s exactly what some colleges are warning their graduating class-to not lose hope for a job until late in the fall.

Other than quite a few of Canadian banks, the Earnings Calendar remains heavy with retailers, and some late reporting tech companies including Hewlett-Packard Enterprise, Palo Alto Networks, Ciena, Mobileye, Tech Data, VMware, & Workday, a richly valued cloud software company. The retailers reporting are second string, except for Lululemon, which will e the most closely watched name, once Michael Kors is done. LULU, for what it’s worth, is proof that a retailer with a strong concept, that sticks to its vision, can outperform the rest of the mall, no matter how slow overall traffic into the mall turns out.

Investment Bank conferences ramp up again for a last hoorah into July, when they all but dry up. Tuesday’s Deutsche Bank’s Global Financial Services Conference will be the scene of the first Q2 comments from the industry. Wednesday, Master Limited Partnerships will try to bolster their value proposition with oil back below $50 p/barrel, as the Association holds a semi-annual mass analyst meeting. Bernstein’s Strategic Decisions is a hodge podge of sectors, while Cowen’s 45th TMT Conference could star. The big meeting of the week is ASCO, for Clinical Oncologists, which may boost Merck more than some others, as the FDA gave approval to Keytruda for an extended number of cancers that are not site specific but, instead, tied to a particular DNA anomaly—which was a first of such approvals and, for now, the only one. Granted, the DNA linked anomaly isn’t very common—perhaps in 4% of cancer patients but that misses the point of the first approval of a "personalized" treatment that targets a specific DNA marker, no matter where the cancer occurred.

Last week’s break out while Trump was abroad was a bit of surprise, as the noose of the Russian investigation started tightening around his son-in-law and chief advisor, Jared Kushner. Sure, the "crime" he’s accused of—trying to set up direct communications with Russia outside the possible trace of the CIA, FBI or other US agency is probably a rookie error, rather than a criminal offense but it still begs the question of whether Trump needs to surround himself with experience operatives rather than his direct relatives. One upshot is, supposedly, curtailment of Trump’s Twitter stream though I find that hard to believe—it was his twitter stream that distinguished his campaign from the standard operating procedure of election campaigns, so it’s hard to imagine Trump being throttled—even if half the country prays for that. The persistent elevation in markets has more than a whiff of a movie we’ve seen before, that often ends very badly. I think it will this time, too, but there could be more lift to come before the day of reckoning. As long as that’s true, PM’s are not about to exit stocks wholesale—no matter the deterioration in the stocks that aren’t in the top 10 of money flows and size. As long as PM’s think they’ll be able to get out before the bottom falls out, stocks could continue to see higher prices, before the trap door underneath opens.

ECONOMIC:  (Highlights, only, below. Ful International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

May 22—26, 2017   AT LEAST TRUMP’S AWAY ALL WEEK!   There is a rising number of journalists willing to write opinion pieces on Trump’s lack of fitness for the presidency. "Trump Unfit" is quickly becoming a mantra of its own. And even those who didn’t vote for him, which he’d disappear, or otherwise evaporate, and go back to his gold bathroom fixtures on Trump Air, and to the gold faucets at Trump Tower hope against all hope Trump can get through ten days of travel without embarrassing the United States.

While Trump’s away, former FBI director Comey is expected to testify at Congress, even as Fed speakers are up and about not just the US but overseas, as well. There’s not a heck of a lot of data on the Economic Calendar that isn’t related to housing—Tuesday April New Home Sales, Wednesday the FHFA March House Price Index, and NAR’s April Existing Home Sales. Also Wednesday, the Bank of Canada is meeting on rates. Given a housing market that’s been getting out of control, foreign buyers like Chinese moving from city to city, as each puts through taxes or other measures to slow the pace of rising home prices that are pricing locals out of the market. The US Press has spoken repeatedly of the cities Trump will visit on his current 10 day tour, making it sound like a religious pilgrimage, winding up at the Vatican, in fact, there’s a NATO Heads of State Meeting, and a G7 Heads of State Meeting, all of which his agenda is scheduled around.

More important, Wednesday, will be the FOMC Minutes of the 2-day Meeting that wrapped May 3rd, with a Fed that stood pat. But as we’ve seen in several sets of minutes, the calm, do nothing attitude communicated by the FOMC Meeting Statement is only half the story. It’s quite possible that conversations about tapering the Fed’s $4.5 trillion book could be farther along than any of us realize. And if that’s the case, then what of NY Fed Pres. William Dudley’s one-time comment that it’s possible rates will remain static while unwinding the Fed’s book gets started. He seemed to back off that position just days later but the concept of not doing both at the same time is at the heart of questions many have asked about the future. Heck, Bullard last week flat out said weak data is a contradiction to the FOMC’s rate hike path which insists on 2 more hikes this year. One thing we may learn, as the year marches on is that Fedheads speak their own opinions, while the actions & minutes of FOMC meetings are a consensus not all that much concerned with anyone member’s personal position unless that’s the same position shared by Yellen, Fischer & Dudley—3 voting members who never rotate to non-voters.

OPEC’s regular meeting, this Thursday, is worth noting, as well. Though Saudi Arabia & Russia have come out in support of extending the production cuts through March of 2018, US shale production increases have offset almost half of the 1.2m barrels the OPEC & non-OPEC Members agreed to reduce production by, that’s been verified as cut from production.

The Earnings Calendar is filled with more consumer facing names, as well as 3 Canadian banks, and Toll Brothers, the builder least impacted by mortgage rates that rose to above 4.0% recently. Also reporting, besides a number of retailers? Agilent, Hewlett Packard, Lowe’s, Intuit, NetApp, Brocade, and Marvel Technology. There was one excellent shopping day before Mother’s Day, Saturday, the 13th, but before and since, the mall has been dying. JCP, proving some stores will do whatever it takes, a la Mario Draghi, to drum up sales, offered a coupon worth $10 off any $10 or higher purchase. Crazy as that deal sounds, I distinctly remember Office Depot once offering that deal, during Back to School shopping season, then complaining that people came in for pens and other supplies, but didn’t spend anything above the $10 offered free with the coupon. Trust me, marketing bed & bath stuff to lodging owners is a much sounder way to pick up incremental sales that don’t require consumers to come to a store.

The Events Calendar could well rule the week. And in a rare instance, two industry meetings could top the big I-bank conferences, this week, because the meetings are mass analysts meetings, in a single hotel, with every company that’s anyone in the industries involved, attending & setting up 1x1 meetings with analysts, even if they don’t present to a larger group The first is
AGA Financial Forum (05/21—23) is a mass analyst meeting for the power industry, the program linked here. However, because so many meetings are 1x1’s, in addition to starting on page 15 of the pdf linked, you might want to, instead, to any of the other company listings on the forum home page. I.e. "One-on-One Meetings," "Company Presentations," "Energy Utility Company Schedules," or even the "Registration List," are worth perusal. The 2nd biggie is EPG—the Electrical Products Group Spring Annual Meeting. another mass analyst meeting (05/21—24) that includes presentations and one-on-ones, at the URL provided. Everyone from 3M & Arrow to Textron, United Technologies, to Illinois Tool Works, and Parker-Hannifan are at EPG. Unlike healthcare conferences, which have been held at least 2x monthly, by investment banks, since JPMorgan kicked them off in January, both of these intend to make it easier for both companies & analysts to sit down face to face—or face-off at the golf tee, and actually talk to each other, and get questions answered. That makes both very well attended, with several I-banks hosting clients at each of those 2 big events.

Given those 2 high profile conferences, I’ll mention, only in passing, a couple of other events, emboldened and highlighted, because they have traditionally provided market-moving news. They are JPMorgan’s TMT, and UBS’ Healthcare conferences, starting Monday. Bear in mind, while we are halfway through Q2, there’s still enough of the Quarter remaining for companies to strike a more confident tone than they did before earnings were reported in April. And in some industries, particularly software, it’s well known that the deals crank up as the quarter ends, so everyone can make their numbers. A hat tip to UBS’ Global Oil & Gas Conference, Tuesday, and SunTrust RH’s Financial Services Conference, starting the same day. It can’t be coincidence that AutoZone reports earnings Tuesday, and Advanced Auto Parts on Wednesday, the same day Jefferies schedule an Automotive Aftermarket Summit, in NY. The Transportation Index has been the Debbie Downer of indices, even as other senior indices made new all time highs. For that reason, a nod to Wolfe Research’s 10th Annual Global Transportation Conference, also starting Wednesday. And whaddya know? UBS is hosting an Auto & Auto Supplier 1x1 Conference on Thursday. Barclays’ Pharmacy Benefit ManAGement & Drug Pricing Symposium, the same day, might attract bees to honey, though ExpresScript was the only confirmed company I found by last Thursday, and it’s AmeriSource Bergen Brunswick Barron’s touted in the latest edition. Was it just an oversight that Barron’s neglected to mention ABC still serving out a sentence imposed by the DEA, banning it from distributing narcotic drugs in the state of Florida, through the rest of the year. Why? ABC was found negligent for failing to get suspicious of the number of painkillers certain drug store customers were ordering, to fill prescriptions written by the 13 pill mills rounded up a few years ago, by the state & DEA, one of which was charged with murder. Given the number of older people in Florida, and the arthritis and cancer they suffer, shutting down ABC’s ability to full orders for narcotics has wound up creating quite a challenge to some of the most vulnerable citizens.

And even with such a jam packed week, bear in mind the month is ending, with a holiday weekend, Memorial Day falling on the 29th this year—as late as it’s been in years. That could well slow volume as the week wears on, and encourage less dip buying than usual. Granted, stocks often rise on the Friday before a holiday weekend, because shorts close their books just as retail investors try to position for bullish trade after the holiday—and the dip buyers have been right for months. But with Trump abroad, talking to world leaders throughout the trip to NATO & G7, I’d watch the dollar to gauge what the world is thinking about his performance. So far, of late, it doesn’t appear Trump has instilled much confidence. Seems worth keeping in mind. That’s one reason I read Barbara
Rockefeller’s Treasury Report daily, and suggest you get in touch & request a free trial—though she’ll be away this week.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions are the author’s, alone, and should be just one factor in more complete due diligence. 

May 15—19, 2017  
MOST of THE REST of RETAIL REPORTS THIS WEEK--- NOT MUCH TO WARM THE HEART IN THAT   Given what earnings from department stores Macy*s, Kohl’s & JCPenney looked like, last week, a week of even smaller retailers reporting Q1 could be a scary prospect. While Saturday, May 6th was the slowest week I’ve ever seen at the local Simon Property Mall, Town Center, the 13th was devoted to Mother’s Day, and hopping. You know shoppers are all about Mother’s Day when the busiest stores are Godiva & Palm Beach Confections, Papyrus, which opened 2 weeks is commonly sighted around the mall, and more men are carrying Victoria’s Secret bags than women (though I find that very sad, given the polyester nightgowns on offer.) But a single week does not a season or quarter make, and the quarter just finished was painful, with few exceptions. Unfortunately, two of the exceptions—Lululemon & Pandora Jewelry—have a lot of good news built into their shares. Pandora, so it’s said, moved across the hall to a bigger location which is unbelievably white, bright, and sparkling, and was packed with shoppers for Mother’s Day, a special bracelet on offer for Mom.

Among the retailers reporting earnings this week, which range from tiny CitiTrends (Wed) & The Buckle (Thurs), to Home Depot (Tues), TJMaxx (Tues.), Target (Wed.), Walmart (Thurs.), & Ross Stores (Thurs.), along with Gap Stores, Ralph Lauren, FootLocker (a strong retailer staying strong), along with a couple of tech names, and Chinese ADRs, along with Deere on Friday.

As often happens, when the Earnings Calendar is winding down, I-bank events crank up, even as media companies will be hosting the Fall TV Season Upfronts, throughout the week. Nomura Instinet’s Gaming, Leisure & Lodging Conference in New York should be well attended. Gaming & lodging companies have been strong, none stronger than Marriott since it closed on Starwood. Tuesday, alone, Bk of America Merrill Lynch hosts Health Care, also in Vegas, Deutscher Bank Clean Tech, Utilities & Power, Goldman Sachs Basic Materials, Citi Car of the Future, Credit Suisse Shale, Stephens an inaugural Energy Executive Summit, D.A. Davidson a Financial Institutions Conference Recap—recapping its Financial Institutions Conference held last week, JPMorgan Global Consumer & Retail, Barclays Americas Select Franchise Conference, KBW European Financials, Needham Emerging Technology, OpCo Emerging Growth, Citi Chemical Conference, BAC/MER Global Metals, Mining & Steel, UBS a Pan-European Small & Mid-Cap Conference, RBC Canadian Automotive, Transportation & Industrials, & CIBC Technology & Innovation 5.0. If that isn’t a s—t load of I-bank meetings starting on a single day this week, I don’t know what would be. And, ironically, it’s Variety’s Webby Awards (Streamed on YouTube) and Square’s Analyst Meeting that could occupy the media. Wednesday, the I-bank Conference schedule is only a little lighter than Tuesday’s.

As for Industry Events, a big Whoops! A Booboo! Interop ITX & 5G Forum USA to be scheduled concurrently---not just in different cities but different states, altogether. Interop & InformationWeek return to Vegas, while the 5G Communications conferences are in Austin TX. And if they weren’t enough there’s a telecom & media event, tmForum Live Digital Disruption, in Nice France, just in time for the Cannes Film Festival which will run through the 20th. .

If the financials don’t pick up, I’ll get a lot more negative on the market. While PM’s are piling into the FANG stocks, there’s not much else going up—or not enough of the soldiers to sustain the market averages, even if the FANG stocks continue outpacing all others. The charts I see, nightly, don’t look particularly healthy to me. Stalled at best, while at worst, hanging on by their fingernails.

ECONOMIC: (Highlights only below. Full
International Economic Calendar here Full ECB Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence. 

May 08—12, 2017  HAVE US STOCKS ALREADY CELEBRATED MACRON’S WIN?   We have the French election to thank for such poor coverage of many of last week’s conferences, especially "Reforming the Fed & Government Sponsored Enterprises," which boasted San Francisco Fed Pres. Williams keynote at the Shadow Open Market Committee Spring Meeting. Williams’ speech "Now is Ideal Time to Consider Alternative Monetary Policy Frameworks" wasn’t even a footnote, last week. And the SEC’s new commissioner sworn in was either mentioned too briefly for me to catch it or ignored, altogether. That’s because Warren Buffett & Berkshire Hathaway’s Annual Meeting made for better visuals with characters like Mr. Peanut. And for all the cut-aways to Paris, the election was barely even a contest. Marcon won the French Presidency with 65% of the vote—polling, finally, scoring a win.

Fed speakers will be everywhere this week, again. And I do mean everywhere since NY Fed Pres. Dudley is speaking in India. And it’s not just US policy makers, either. Mario Draghi will be speaking at the Dutch Parliament, in the wee hours of Tuesday morning, US East Coast time. And Chicago Fed’s Evans is in Dublin. I won’t recap the entire Economic Calendar, here, because the highlights, and even some lowlights, are below but I’d be watching Wednesday’s 10-year Notes Auction, and Thursday’s 30-year Bond auction. Both feel like a tough sell, while the FOMC seems hellbent on raising rates, again, in June, and after rates have slid down from this year’s highs. And it’s hard to get too concerned about Friday’s April CPI, when Oil has collapsed, recently, even if that doesn’t show up until May’s report.

It’s hard to put together such a large Earnings Calendar that appears to amount to a small hill of beans. The number of tickers emboldened are a small fraction compared to the number reporting because, for many sectors, like financials, the gig is already up. Tuesday, someone should declare Liberty Media day, because of the plentiful tracking stocks reporting in the morning. Other media companies reporting this week include Discovery, News Corp, 21st Century Fox, and Walt Disney (no"the" because it's not intregral to the ticker) but it’s the retailers likely to draw even more attention, given how much we, already, think we know about Fox’s payoffs to women who alleged sexual harassment. Come Thursday morning, Macy*s and Kohl’s report earnings, while that afternoon Nordstrom is at bat. Friday, J C Penney reports. We might also hear from Dillard’s on Thursday morning but it doesn’t go out of its way to keep non-Dillard shareholders informed of its plans, so that’s only speculation based on history, without any basis in fact.

A week prior to Mother’s Day, the local, Simon Property owned Town Center Mall was the least busy it’s been in months. Someone could have taken a bow and arrow and shot it down any corridor without hitting a visitor. The quiet shook even me up, since I thought I’d seen it all until the new low in foot traffic hit on Saturday. Even Starbucks stores didn’t have lines to order or pick up—and that’s unheard of, since mall workers are as likely to be those waiting on line as shoppers/visitors. Anyone hoping for an improvement in retail, or some optimism from CEOs could be sorely disappointed on the coming post-Eps conference calls—assuming our mall was representative of other malls around the country, which it usually is. In fact, the only time we lead the rest of the country is during Back to School shopping, since our schools start their fall session the 2nd week in August, which tends to pull BTS shopping into early August. And for all the analysts’ talk about athleisure winding down and denim making a comeback, I’d posit the only thing driving denim sales is the offer of 50% --70% discounts on denim jeans & shorts.

And you know the Earnings Calendar is larger than it is important because investment bank conferences are ramping up for a last fling before summer becomes too big a distraction and the ranks in New York thin. The one house at which we’re weak is BAC/Merrill Lynch which has finally cut off our access, 17 years after we took our account elsewhere. But Tuesday is fairly representative of what I mean, with Wells Fargo hosting 2 big conferences, while others are offered from Jefferies, Goldman Sachs, Deutsche Bank, D. A. Davison, Oppenheimer, Citi, and Imperial Capital, hosting events in the US, while Nomura Instinet is in Hong Kong. Wednesday, Citi, BAC/MER, JPMorgan, Credit Suisse, and Citi host conferences, while on Thursday, it’s 2 from Deutsche Bank, Credit Suisse, Instinet, HSBC, and 2 from Citi, even as Wells Fargo hosts its Investor Day, which probably won’t be a sleepy event. And if you’re looking ahead to Russell’s annual rebalancing, the close this Friday informs it’s 6/23 decisions.

It was a bit surprising to see the major indices finish last week to the upside. The number of stocks with strong charts are thinning, which is usually indicative of either consolidation or a waning rally. Given we’re well into May, and stocks could barely muster energy after the House finally passed the healthcare bill that is supposed to set up the conditions for a sweeping tax reform bill suggests all’s not well. Repeal of the $900B in costs (over ten years) Obamacare (the ACA) swept into law was supposed to be the linchpin upon which tax cuts can be instituted. Obviously, stocks didn’t overlook the hurdle the House bill faces in the Senate but Trump finally pulling his party together to pass reform of Obamacare should have elicited more enthusiasm. The fact that it didn’t should be a warning that a period of more skepticism has arrived, which should lead to consolidation, at the very least, and perhaps something more painful for the bulls. Let’s not overlook how badly the DJIA is lagging, for 46 days straight. Granted, IBM was the biggest problem, last week, after Buffett said he’d sold about a 1/3 of his position but it wasn’t alone. The banks which led to the upside after the election have been struggling after 20%, or worse, declines off their highs. I’m not going to endorse "sell in May and go away" because the track record of that maxim has been damaged since the 2009 bottom was put in early March, or that year. But reject the notion that you can buy willy nilly, here. With so many charts breaking down or, at a minimum, backing off more than one would expect when the other indices are making new all time highs. The number of stocks leading to the upside are narrowing, and they’ve become remarkably crowded trades. And perhaps, Macron’s win in France, as expected, is news to sell.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.  

May 01—05, 2017   EQUITIES HAVE BEEN FULL OF SURPRISES!   That wasn’t the week I expected, last week. The celebration of the results of the French Election was a lot more enthusiastic than I expected, and then, earnings reinforced the optimism, almost across the board. The FOMC may have rate rises on its mind but it appears a foregone conclusion that they won’t make a change during this week’s meeting, if for no other reason than they haven’t prepared the markets for it. For the March hike, they started driving their intent home only 2 weeks before the meeting started but they got the point across as well as if they’d stood in town squares across America with megaphones. They haven’t done that this week, though surely have Trump’s tax intentions to add to their thoughts on future hikes and unwinding the balance sheet. The problem, that for all the enthusiasm for Trump and his tax cut intentions, GDP grew just 0.7% in Q1, and that’s despite a market rallying since early Nov.

And let’s not even discuss how much of Trump’s tax plan will actually make it through Congress because we’d be here all night. I’d rather look at the week ahead, anyway. On the West Coast, the biggest event will be the Milken Institute Annual Spring Meeting, (Los Angeles CA thru 05/03). I could write an entire outlook on just the biographies of the hundreds of speakers but, instead, will list some of the megawatt ones who often need no introduction: Jamie Dimon (JPM), Treas. Sec’y Mnuchin, Sec’y of Commerce Wilbur Ross, Stephen Ross (Related), Nouriel Roubini, Softbank’s Masayoshi Son, Chevron CEO Watson, World Bank Pres Jim Yong Kim, Sam Zell, Angela Ahrendts (AAPL), Prince Fahade Al Saud, Celgene CEO, IBM, Thomas Barack (Colony Capital), Salesforce.com, Henry Blodget, Julia Boorstein (CNBC), David Bonderman (TPG), SoFi, FaceBook, former Pres. George W Bush, former Florida Gov. Jeb Bush, Eric Cantor, WalMart, Apollo Global, Cisco Chairman Chambers, Blackberry’s John Chen, Airbnb, Michael Eisner, Mohamed El-Erian, CNBC’s David Faber, and hundreds more. On air personalities from CNBC, Bloomberg & Fox are invited to assure the conference gets media coverage. And despite his former time in jail, Milken devotes the organization and funds raised for cancer research, a disease Mike Milken personally overcame.

On the East Coast, in addition to an 2-day FOMC Meeting with the statement due at 2pm on Tuesday, there’s Deutsche Bank’s 42nd Annual Health Care Conference in Boston, starting Wednesday. Think about that a moment: DB has hosted this conference for 42 years, when many of the portfolio managers running billions are younger than that. Deutsche includes biotechs, pharma, and even the providers and some insurers. For some reason, Deutsche is exceptionally busy hosting, also, Extreme Services One-on-One in NY, the same day, along with an Andean Region Conference, also starting the same day.

On the Gulf Coast, starting Monday, OTC—Offshore Technology Conference is a mass meeting in Houston for the oil industry which, ironically, is doing less offshore and more onshore, in shale regions. Credit Suisse holds its 20th conference alongside the event, but other I-banks will host clients & companies during OTC, to capitalize on so many explorers & drilling CEO’s being in one place at one time. So, it’s quite ironic that the US Energy Association Annual Membership Meeting & Public Policy Forum should take starting Thursday, in D.C. Did they charter a plane to get execs from Houston to the nation’s capital?

Whatever you thought of last week’s Earnings Calendar, hasn’t prepared you for this week’s. There’s not only a larger number of companies reporting this week but possibly, less substance to the Earnings Calendar than the ticker count belies. I had to struggle to fine tickers to embolden, and even then, realized that some that qualified won’t move the market or, even, their own sector, whether they win or lose. For the size of the list, there are very few emboldened, at all, a quick scan of those a map to the sectors heavily represented. Aside from Apple on Tuesday afternoon, and Facebook Wednesday afternoon, it’s easy to spot a number of oil companies, like Royal Dutch Shell, Occidental Petroleum, Anandarko, Apache, and more. But didn’t Chevron & ExxonMobil already break the ice and roll out the carpet, last Friday? Heck, running through the charts, tonight, I was shocked at where Schlumberger is trading—and the angle of decline, even as OPEC sends out a regular stream of production cut notices, as if talking about them can make the oil in storage shrink. Today, it was Abu Dahbi’s National Oil Co cutting by (-10.0)% the amount of oil it will sell in May, after cutting (-7.0)% for April

I also noticed a number of media companies reporting this week, even as the Digital NewFronts will take place. For those who haven’t encountered NewFronts before, it’s the term the IAB (Interactive Ad Bureau) is using to describe digital "Upfronts" that seek to sell ad time and space for the future, now. The IAB, seeing how much money has moved to online ads, has managed to make NewFronts an organized event that involves selling space in the ether to traditional advertisers like Chevy (GM), Gillette (PG), and the like. OF course, we’ve all read about the problems of in appropriate web content attracting ads from companies that wouldn’t want to be associated with the content but I can’t figure out why the advertisers think online ads shape buying behavior at all. Even when I use Google for Search, I usually page to the 2nd or 3rd page of results, where I’m more likely to get results that Google isn’t being paid for me to see. But that’s just me. Media companies reporting this week range from Gray TV to Time Warner, with Scripps & others in between. If restaurants are your thing, Texas Roadhouse Grill reports Monday afternoon, Yum! Wednesday morning, Cheesecake Factory that afternoon, but they’re not alone. If drinks are more your thing Bud & AmBev both report this week, as do Altria & Reynolds America. I could go on playing this game but you’ll catch on quickly by just skimming the emboldened tickers.

Which brings us to the rest of the Economic Calendar, because the April Unemployment Report will be released Friday, Chain Store Sales from the 9 that still report monthly are expected on Thursday, while the BoJ releases minutes from its 3/15—16 meeting overnight Monday, when the Royal Bank of Australia is set to announce it’s rate decision (05/02 local time), into our Tuesday morning, while the Norges Bank (Norway’s central bank) meets overnight Wednesday (east coast time). So that’s quite a bit of Central Bank activity, even before the FOMC is let loose to roam with its latest message, which it will do en masse by the end of the week. The Hoover Institution’s "Structural Foundation of Monetary Policy: A Policy Conference" boasts Fed Vice Chair Stanley Fischer opening Friday, at 11:30am, and Bullard, Evans & Rosengren panelists at 1pm, out at Stanford California. FOMC Chief Yellen is speaking later in the day but probably won’t talk policy, since her speech is "125 Years of Women’s Participation in the Economy.," which doesn’t easily lend itself to policy discussions. Fed’s Williams keynotes at the Shadow Open Market Committee (SOMC) Spring Meeting, on "Reforming the Fed & Government-Sponsored Enterprises," which might lend itself to policy more than Yellen’s speech will. Ditto Fischer, Bullard, Evans & Rosengren. On Saturday, the Hoover Institution joins the Stanford Institute for Economic Policy (SiEPR) to debate "Has the ‘Neutral’ Interest Rate Declined and How Does that Affect Fed Decisions?" Sounds like a more promising topic to discuss rate hikes and unwinding the balance sheet, and whether those two should alternate or happen simultaneously, which is what the Street has been asking.

Also Saturday, Chinese & Japan’s FinMins & central bankers are slated to hold a summit, on the sidelines of the ASEAN FinMins & Central Bank Governors/Deputies Joint Meeting in Tokyo, shortly after the end of the Asian Development Bank 50th Anniversary Celebrations, Monday’s meeting jointly with U of P, at a Joint Global Think Tank Summit, in Yokohama Japan. Mario Draghi has a speech scheduled this week at an awards ceremony, in Lausanne Switzerland, so he might not comment on policy, either. And what’s especially odd about the flood of central banker activity is that, in many countries, Monday is a holiday—May Day or Labour Day, almost everywhere but here, yet not slowing any bankers down.

By now, you’re probably curious about seeing the Calorie Counts on menus, that starting Monday must be provided by any organization with 20 or more locations. What many don’t know is that the rule doesn’t apply to restaurants, alone, but to bowling allies, movie theaters or any other place serving food that has more than 20 locations. Whether that information will change anyone’s eating habits remains to be seen but that was the hope in making that information mandatory, as of Monday.

All in, I’ve been surprised at the continuing enthusiasm for stocks, even as I’ll admit earnings sound better than expected by most. Still, I don’t believe Trump will get his tax cut wish list through Congress intact, not when it will, unquestionably, raise the National Debt, and set up the Trump Organization to benefit more than most. A billionaire who wants to eliminate the Estate Tax? Tax "S" Corps at 15%, like large corporations? Trump has no idea how to mid-wife legislation through Congress, and won’t have much patience waiting for McConnell & Ryan to do it for him. Sooner or later, stocks will wake to realities but, until then, enjoy the ride.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

April 24—28, 2017  
GLOBAL CELEBRATION AFTER FRENCH 1st ROUND VOTES    Global Markets are set to celebrate the fact that a moderate and pro-EU candidate will face off against Marine LePen, as a result of the first round of French votes in National Elections. With the other candidates—mostly throwing their support towards the moderate, Emmanuel Marchon, the Euro will rally as well. Why US Futures are up so much is a bit of a mystery; Trump's still president here, and that means continuing whiplash and big promises that aren’t backed by action—not to mention the occasional misdirection, as well, like an aircraft carrier near Australia claimed on its way to Korea.

If the French election results weren’t enough to celebrate, when markets open Monday morning, then Becton Dickinson (BDX) agreeing to acquire C.R. Bard (BCR) for $24B, at a 25% premium to Friday’s close, should do it. That’s $317 per share for Bard holders, consisting of $222.93 in cash, the rest in BDX stock. For all the fear of legislative controls on pricing, the healthcare industry remains a hotbed of activity. How will Congress ever come to an agreement on price controls for drugs, if it can’t agree on anything else? The fears that sent pharma stocks down are overblown.

Of course, with one of the heaviest weeks of Earnings on tap, there’s plenty of time for more sobering news to cool animal spirits before the week’s out. And if Earnings results don’t do it, there’s always the possibility of a partial shut down of the Federal Government, if Congress can’t manage to pass another Continuing Resolution (CR) to fund the government past Friday at midnight, when the current funding runs out.

The Economic Calendar is replete with housing related data and $195 billion of government debt to auction, the heaviest week in quite a long time—ironic given that it’s money to fund past debts incurred, and won’t help keep the government operating, if an CR isn’t passed. And while we’re at it, the debt ceiling came back into play, a couple of weeks ago, and there’s been no movement to lift that either, despite Trump’s plans to spend billions more on defense, new billions on infrastructure, and more billions to build a southern border wall that plenty of people are dead set against. All that as Trump talks up big tax cuts to come, which will put the US into deeper hock. Go Figure! At least Congress is back from a 2-week Easter recess, Monday, which means there’ll be legislators in the Capitol to vote on measures that may be put to the floor.

So a little of the nitty gritty is in order, after presenting the Big Picture. Tuesday S&P Case Shiller releases its Feb. House Price Index, even as the FHFA does the same, also for Feb. US March New Home Sales will be reported Tuesday, as well, even as the Treasury auctions $25B 2-year notes the same day. On Wednesday, the Treasury plans to auction $15B of 2-year Floating Rate Notes (FRN), which should be an easier sell than fixed rate 2’s the day earlier. And wait, there’s more: Also Wednesday, the Treasury will auction $34B of 5-year Notes. Wednesday brings the usual weekly release of EIA’s Petroleum, Gasoline & Distillate stockpiles, but it’s Congress to watch because that’s when the House Financial Services Committee will discuss a 600-page Dodd-Frank Replacement Bill. Also Thursday, T-3 for end of month, and end of the best 6 months of the year for equities, which is why "Sell in May and Go Away" is bound to be a hotter topic as the week wears on. Then, overnight, into Thursday in the U.S., the BoJ, Riksbank, & ECB are all out with post Monetary Policy Committee statements, and any changes in rates or QE that may be decided or discussed. Thursday, more housing data, in the form of the National Ass’n of Realtors’ March Pending Home Sales, the indicator of future activity that should erase any lingering concerns about March housing starts which slumped (-6.8)%. Then, we’ll also see how hard it is for the Treasury to sell $28B of 7-year Notes, at the auction scheduled for 1pm est, at the end of a heavy week of issuance.

Just as the Street is cruising towards the end of the week, and hopefully, not still facing a potential government shutdown, US 17Q1 (advance) GDP will be released, the first look at a quarter that again severely disappointed, according to the Atlanta Fed’s GDPNow, which has it at 0.5%, despite the NY Fed estimate still comfortably above 2.0%--at 2.7%, to be precise, according to the FRBNY Staff Nowcast found
here. It’s a head scratcher that even their different methodologies doesn’t sufficiently explain. I don’t think either of the Fed speakers Friday will touch on monetary policy, unless forced to during the Q&As.

It’s hard to even sum up the Earnings Calendar for this week but you know I’ll try. Just about every homebuilder that hasn’t reported to date will do so this week. Also reporting, MGM, Las Vegas Sands, Penn National, & Wynn Resorts, so pretty much that entire industry, as well. Precious metal miners also pretty much wrap it up this week, with close to a dozen miners, including Barrick Gold, Newmont Mining, and even tiny Eldorado Gold, well known mostly because of its ticker: EGO. Some large Biotechs are on the agenda, as well, including Amgen, Biogen, and Celgene, along with quite a few drillers, half the defense industry, and most of the automakers—not just Ford, GM & Fiat Chrysler but Honda Motors & Volvo, as well, along with a number of large vehicle retailers, like Penske & AutoNation. And if you want to know how lower middle class borrowers are doing, you probably won’t find much in the mortgage industry’s numbers but could from Discover Financial, Capital One, Synchrony, and Ally. They all report this week, too. Then, there are airlines, including American, Alaska, Spirit, and more, along with beverage companies that compete to be served by them, Coke, Pepsi, Dr Pepper Snapple. And that’s before I point out reports due from Microsoft & Amazon on Thursday afternoon, or Chevron and ExxonMobil on Friday. The best way to handle the Earnings Calendar is to start with the tickers emboldened, then fan out from there. While the emboldened tickers are completely subjective, and would look radically different if someone else took on the task to embolden them, it’s my hope that the ones chosen are the ones that the media & analysts will focus on the most, which gives them the power to sway their sector or the market, overall.

Which brings us Events, though clearly, the most eagerly awaited of all is next Saturday night’s White House Correspondents Association dinner, which Trump declined to attend, making the possibilities for skewering him all the more tantalizing. Sunday evening I read of a planned Trump rally Saturday, in the capital, which may make navigating to the dinner more challenging than most years. Before then, some of the bigger events include NAB, the Broadcasters’ Convention & Expo, and the Int’l Home Furniture Market, better known as High Point, for the North Carolina city it takes place in. The European Society for the study of the Liver Congress would normally be as impactful as any Liver event in the US, were it not for earnings that will likely drown out news from Amsterdam. Ditto the Congress of Clinical Micro Biology In Infectious Diseases, in Vienna. Healthtech’s Drug Discovery Chemistry is an annual collection of conferences, in San Diego this year. Again, earnings noise will compete. Beverage Forum Wednesday? AFCEA Spring Intelligence Symposium? GiGse (iGaming)? Alliance for Regenerative Medicine Cell & Gene Investor Day? It’s pretty much the same no matter which conferences I pull out—no matter how big they’re slated to be. Earnings keep looking likely to crowd out news feeds. And surely by Thursday’s T-3 for End of Month, government funding will be weighing most heavily, if Congress hasn’t hammered out and passed a CR by then.

There are a couple of annual conferences, that most don’t follow but kick themselves for forgetting about when they come around, again. One is Rutberg’s Summit in London, the other Burkenroad Reports, this year the 20th Annual Investment Conference in New Orleans. Rutberg can’t be described in a few words. Its presenters include names as diverse as Axiata, British Telecom, Stanley Works, FedEx, Google, Turkcell, Citi, IAG’s British Airways, L’Oreal, ING Group, Godiva Chocolate, 21st Century Fox, Expedia, RioTinto, Tesco, AXA, Hershey, Wyndham Hotels, Volvo Cars & Trucks, Facebook, Autozone, Vivendi, and John Lewis, to name just a few that demonstrate the speakers list is from everywhere, with no sector excluded. It starts Monday. Burkenroad Reports is a Tulane University conference outgrowth of an investment newsletter that also can’t be summarized in a few words, except to say that all the presenters meet the investment criteria of Burkenroad Reports. This year’s presenters are as diverse as Crown Crafts, Pool Corp, Cal-Maine Foods, Sanderson Farms, Sharps Compliance, Sunoco LP, and MidSouth Bancorp.

So, with all this on tap, there is bound to be cross-currents tossing the markets every which way. And it doesn’t get easier for the next two weeks, either, as the flood of S&P 500 companies reporting their earnings during the coming 3 weeks will continually mix the good, the bad, and the ugly, even as Congress will need to do the right thing for the country, and the world, and that’s not a given, as the march to a government shut down could prove relentless without some legislators swallowing their pride and voting for what they must, rather than what they’d rather or prefer. Just as Donald Trump couldn’t get his own party behind the Obamacare repeal & replacement bill, he needs even more now—not just his party but some democrats, as well. And I long ago gave up counting on the nearly impossible. Volatility is sure to return, Monday’s French election celebration a great opportunity to protect the downside.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

©
Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.   

     
April 17—21, 2017   WHAT PART of LAST WEEK’S DECLINE WAS TIED TO 3-DAY WEEKEND, ALONE?    A heavy Earnings Calendar ahead will compete with the many meetings tied to the World Bank/IMF Joint Spring Meeting. While the meeting doesn’t officially start until the 21st, the "pre-conferences" and tied in conferences start lifting off on Tuesday. I have provided links to the schedules where applicable, overwhelmed by the surfeit of US officials, especially, planning on speaking—sometimes 2x in one day. Even U.S. Treasury Secretary Mnuchin is scheduled to speak twice, this week.

While most of the US Data released this week will revolve around housing, for some, a late Personal Tax Due Date, on 4/18, pushes out when the last of the great procrastinators could have funded their 401K’s and other retirement accounts. The usual tax day, the 15th, is a Saturday, and Monday, the 17th, is Founders’ Day in D.C., another holiday, pushing the tax due date out to Tuesday, this week. Any early in the month outflows from funds in the first half of the month, is often made up in the 2nd half, as those funds are taken out of personal accounts & ETFs and find their way into retirement accounts, for professional managers to invest.

And then, there’s the Earnings Calendar cranking up, the number of banks reporting reason enough to break our usual habit of sticking to only the money center banks & largest regionals, to emphasize the point that banks still dominate. Last week’s good earnings from JPMorgan and Citi weren’t greeted with celebration. Some of it may have been the fear of staying long in advance of a 3-day weekend, in the face of a newly aggressive US military, bombing Afghanistan & Syria, with unveiled threats about taking care of North Korea if China doesn’t.

I’ve emboldened more tickers of reporting companies than usual, this week, because a more diverse group of companies reporting represent a larger number of sectors than usual. For instance, with Charles Schwab, Morgan Stanley, InterActive Brokers, TD Ameritrade & E-Trade Financial reporting this week, in addition to Goldman Sachs, on top of the reports from last week, is a full sweep of retail and Investment Bank earnings, completing the group. A smattering of drug companies report, including Abbot and JNJ. If you watch no other reports than the ones highlighted in bold, you’d get a full sense of the state of the economy. With all the reports ahead this week, and two weeks following of even more reports, it’s hard to see exactly when the Street will celebrate improved earnings—or if Trump’s flip-flopping policies will continue to weigh on the major averages.

Events? Not much in the way of those, either, beyond the World Bank Group & IMF Joint Spring Meetings in D.C., and other events timed to coincide with those. That has as much to do with Earnings season in full bloom, as it does with that Joint Meetings.

My guess is that Trump proved he doesn’t walk on water when the House had to table a vote on the repeal & replace Obamacare bill. He reinforced the fact that he’s no savior when the Senate had to take the nuclear option—change the Senate rules to confirm Gorsuch to the Supreme Court with a simple majority, instead of the long-standing 60 votes needed in the past. Then last week, Trump’s flip-flopping on Chinese currency manipulation, NATO’s usefulness, and the Import/Export Bank put even more of Trump’s plans in doubt. The fact that Trump is moderating his positions should be cause for some to celebrate but, at the moment, that’s not what happened. Proving more flexible than he was on the campaign trail, is something else to celebrate but for now, that’s not what the Street has done. Instead, the Street sees only the uncertainty he generates on every topic, and we all know how much the Street hates Uncertainty. For now, that may keep stocks in check and trigger more selling if Earnings don’t deliver to expectations. That could make long the hardest place to be.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions are the author’s, alone, and should be just one factor in more complete due diligence.    
   
April 10—14, 2017  SHORT WEEK WON’T LACK ACTION   Friday is a holiday, Good Friday, which is why the major banks are reporting Thursday. That includes JPMorgan, Citigroup, PNC Financial, & Wells Fargo. Before Thursday, the Earnings Calendar is slim, with only Delta Airlines, Wednesday morning, as the appetizer prior to the banks the following day.

The biggest curiosity of the week revolves around major, long term debt issuance, this week, from the US, UK, Japan & Germany. The US 30-year reopening isn’t until Wednesday. Before that, Japan will issue 30-year JGB’s, Germany 10-year Bunds, and UK 30-year GILTs, all of those overnight Tuesday, into Wednesday morning in the US east. For the UK, it’s the first long dated debt offered since the country invoked Article 50 of the Lisbon Treaty, triggering Brexit. If the yield is the only consideration, the US should come out on top, since 30-years pay more than all the others, by a mile.

G7 Foreign Ministers meet starting Monday. One can only regret that the meeting didn’t take place before Trump sent 59 Tomahawks into Syria but, alas, Trump’s team probably felt he needed to act expeditiously, and forcefully, to make his point, so no time to wait for diplomatic channels. No doubt, the phone lines were burning up. It’s unimaginable that the Trump White House warned the Soviets without, also, notifying the US NATO allies, as well.

Friday is a holiday, the Bond Market closes early on Thursday, in advance of the Friday holiday but the BLS schedule still shows CPI being released at 8:30am, on Friday. If a tree falls in the forest and no one is around to hear it, has it really fallen? Oil prices pulled back in March, as did prices at the pump, even as retailers were offering up to 70% off, to clear winter and early Spring deliveries. So that should have kept inflation down, except in the supermarket where fruits and vegetables for the holiday are silly pricey—especially for "organic" products, where the news is not good. Sunday, Walmart was forced to recall Fresh Express Organic salad after 2 bats were found in packages. Ugh!

It’s possible China’s March CPI & PPI will get a bigger reaction that the US versions, March PPI out Thursday in the US. While the Fed’s Labor Market Conditions Index is out Monday, and Feb JOLTs, which measures quits and job turnover out Tuesday, along with the NFIB, the two Labor market indicators have been a big shrug, on days when they’ve been released in the past. With the Atlanta Fed’s GDPNow now showing a sub-1.0% Q1, my reaction to both JOLTS & LMCI is, "So what?" If anything, the Street reacts more to the U.M. Consumer Sentiment Surveys, even the preliminary ones mid-month, that survey all of 250 people, another "So what?" in my book, since consumers don’t often spend when they’re most upbeat. On the contrary, the more down they are the more they’re likely to spend. See fall 2008, when consumers spent money like there’d be no tomorrow.

As for the Events Calendar, the Bk of America Merrill Lynch Auto Show coincides with the preview days of the New York International Auto Show, graced, as well, by a J D Power AutoForum. For some reason, Digital Dealer, for auto dealers is, instead, in Tampa the same days. The Edison Electric Institute hosts Key Accounts Workshops, starting Sunday, but other than that, most of the events are healthcare related, including Addiction Medicine, Laser Surgery, Immune Profiling, World Vaccine Congress, to name a few. The healthcare sideshow is Anthem’s day in a Delaware court, in its quest to undo the block regulators put on its planned takeover of Cigna. Cigna doesn’t even want to merge with Anthem, and is suing Anthem for $13B in damages, so it’s hard to figure out what Anthem intends to accomplish with its suit.

Other than those events, NAIC, the State Insurance Commissioners, and NAPCP for the Commercial Card & Payment Industry starting Sunday & Monday respectively. The 15th is Saturday, and Monday Founders Day in D.C., so taxes are allowed to arrive later than usual. Patriot’s Day is Monday, in Boston, and the day the Boston Marathon is run, the festivities a weekend event, despite the Christian holiday. But then, Easter & Passover move around like the Chinese New Year, as a couple of retailers pointed out when delivering March data, or forecasting it. That means many retailers are counting on April making up for a weak March, though I wouldn’t get my hopes up too high, given the steep discounts offered throughout the mall.

So the week really could come down to Thursday’s earnings from the banks. While none have guided down, a couple did say that equity trading was soft, a result, no doubt, of markets that into March ran in what seemed like only one direction—up. But that’s not been the story since March 1st, or so, with Bank’s down considerably from the highs set last month. That could mean there’s plenty or room for a rebound but the question is, for how long? I suspect not that long, at all. The next big bounce in banks is probably one to sell, and ditto the rest of the market as earnings season progresses. There’s a reason Sell in May and Go Away has been a long-standing mantra on Wall Street. May through October are some of the weakest months of the year, except for a bounce when Q2 earnings start getting reported in July. Plenty of time to sell the April rally, and nibble new positions before the July one. No reason to stand pat, unless you plan on selling calls against your positions, and using the premium to buy puts underneath the market.

ECONOMIC: (Highlights below, only. Full International Economic Calendar is here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence. 
 

April 03 –07, 2017  
DON'T EXPECT MUCH OUT OF STOCKS THIS WEEK    Federal Reserve speakers are prominent, again, this week, though a couple will be speaking overseas, Fed Gov. Daniel Tarullo, leaving the Fed this week, out for one last speaking engagement before he goes. And more important than Fed speakers could be how Pres. Trump relates to China’s Xi Jingping, when they meet at Mar-a-Lago, Friday

A new month means the usual PMIs, ISMs, and Unemployment Reports, the latter on Friday in the US, some not expecting the kind of blow-out February delivered, partially credited to a warm month and pent up demand unleashed after the election. March, unlike February, featured a couple of really wicked snow storms that engulfed the middle of the country, straight up the East Coast. How odd is the weather, this year? Down here in Boca Raton, the temp was just shy of 90 degrees, Saturday and, by Sunday, the humidity was so thick you could cut it with a knife, even as the northeast was receiving another dose of snow that could accumulate up to a foot before its done. March Motor Vehicle Sales, out Tuesday, may not be as weak as some suspect, thanks to a month with 31 days, after one that had only 28, and with incentives as deep as they were—including one dealer advertising Buicks reduced by $10K—sales may be perky again. But, then, take the snow states out of the month, and there wasn’t a full 31 days of selling, either.

One thing that won’t be a problem is the US Treasury. Other than the, as yet, unannounced 4-week bills issued weekly, there’s no activity after Monday’s 3- and 6-month Bill offerings. On the week, ex-the 4-week issue, $72B of Treasury offerings vs $193B on the same basis, last week. FOMC Minutes of the March 14—15 meeting, on Wednesday, could reveal more discussion of unwinding the Fed’s enormous balance sheet than the bond market is prepared to hear.

The Earnings Calendar has little to offer. Tuesday, A. Shulman & Canada’s Hudson Bay, rumored bidder for Neiman Marcus, after supposedly holding discussions with Macy*s. Wednesday, Monsanto & Walgreens Boots Alliance, the latter’s plan to take over Rite-Aid still stalled awaiting anti-trust approval. I think CVS & WBA have sufficiently consolidated the retail pharmacy industry, and Rite-Aid should remain the odd man out, after Duane Reed fell. And worse, the thought of Fred’s picking up what WBA/RAD have already agreed to divest is frightful—it’s just not big enough to handle that kind of acquisition, and the debt that will come with it.

Wednesday afternoon, Bed Bath & Beyond reports, along with Yum China, the still new spin off from Yum Brands! Many used to think BBBY was in a great position, because Linens ‘n Things went out of business but I never did understand it buying "The Christmas Store," a baby chain, or opening Harmon Face Values all over the place, often just yards from an existing BBBY, which already sold the HBA Face Values sell. And while BBBY has told analysts it will trim its 20% off coupons and catalogs, to boost profitability, that hasn’t happened, yet. I still get 6-page circulars monthly, the inevitable coupon printed on the back. Yet, when I decided I needed a new roasting pan, the one I liked was $49.99 at BBBY, and $13.99 at Target, the TGT one, actually, better for me, because it weighed about a pound less. That matters when cooking a turkey that weighs in at double digits, before the potatoes are placed around the outside edge of the pan.

Thursday morning, earnings reports are expected from CarMax, Constellation Brands, Lamb Weston-—the ConAgra spin-out—and Schnitzer Steel. To hear Barron’s tell it, KMX is suffering falling used car prices, and higher delinquencies in its finance unit. Constellation Brands, which owns rights to sell Mexican beers in the US, must be stressing Trumps renegotiation of NAFTA. Schnitzer Steel is in an industry targeted for large tariffs on foreign imports, said to be dumped in the US. That afternoon, PriceSmart has most of its stores in the islands & Latin America, where Amazon has not, yet, taken over retail. And as a warehouse club, with a sense of treasure hunting, it’s more like CostCo of BJ’s than any other retailer. CostCo, by the way, has the easiest comps in the US, in April, because that’s the month Amex was no longer accepted, last year, but before Citi’s Visa got its marketing to COST customers in full gear. In fact, COST could have a couple of months of easy comps ahead that might be an opportunity.

Which brings us to Events, where the Cancer Research Annual must be the least talked about AACR meeting in history. The Street is so obsessed with the Fed, Trump’s tweets, and Republican in-fighting, which defeated Obamacare repeal & replace, that AACR abstracts have hardly been discussed, at all. Then, again, the Congress on Alzheimer’s & Parkinson’s Disease hasn’t been much talked about, either, its Vienna Austria meeting perhaps too far away. ENDO, the 2017 meeting of the Endocrine Society has gotten more attention than AACR.

Monday, OGIS for Oil & Gas Independents, in NY, will be one of the better attended events. Ditto Bk of America/Merrill Lynch’s Oil & Gas Conference in London. But Europe also hosts MIPTV, for TV Programmers, so media will be a focus, as well. Never mind the Cannes France location; cross-border & ocean TV deals have been done all the time. How else did "Slumdog Millionaire" feature an American show?

SAE World Automotive Congress, in Detroit, will keep motor vehicles in the consciousness beyond March sales data. For those watching precious medals the Denver Gold Group European Gold Forum, in Zurich, should be noted. I suspect Aircraft Interiors, in Hamburg Germany, will make more noise. Despite an airline about to hit the public stage—Frontier—boasting some of the most interesting paint jobs on its aircraft, it is the interiors that customers experience most, and where JetBlue distinguished itself, initially, with back of seat TV screens, content provided by the always imperfectly transmitted DirecTV. Raymond James is hosting Commercial Aviation, this Wednesday, in NY. That surprised us a bit because Aircraft Interiors usually draws most of the industry to Germany. We admit to our failings, when we can’t find an event on an I-bank calendar and Barclays Generic Pharmaceuticals & Biosimilar Symposium in NY, is not on Barclay’s calendar but the particular source on that event is too reliable to doubt. Speaking of Healthcare, Needham & Co holds a Healthcare Conference Tuesday & Wednesday. Also in healthcare, Stem Cell Research & Regenerative Medicine starts Wednesday, with Diabetes the Pre-Conference, in Boston, Tuesday. In fact, no matter how much I try to give equal time to other sectors, it just seems like there are more healthcare-related events, always. Whether it’s I-bank Therapeutics days, or Anesthesiology & Acute Pain Medicine, Addiction Medicine, or ERS, European Congress of Sleep & Breathing Research, and those are all on Thursday, or start that day.

Hong Kong is where Sotheby’s chose to auction its 59+ carat flawless Pink Star Diamond, Tuesday. Landing something that unique creates a halo effect. Of less interest, perhaps, the Farm Equipment Manufacturers Supply Chain Summit in Little Rock AR, starting Wednesday. A friend of mine just told me how important tax reform would be for farmers, and then proceeded to tell me how his family lost their farm when they had to sell most of it to pay off estate taxes. One thing is for sure, farmers are hurting, this year, and that’s never good for the equipment manufacturers.

With Q1 put to bed, it’s just 10 days until some important earnings start coming out, which means it’s also time for earnings warnings. I was surprised that financials sold off so strongly, Friday, including JPMorgan which will be one of the first to report, on April 13th. Citigroup and Delta Airlines might report the same day, along with PNC Financial and Wells Fargo, which I haven’t confirmed, as yet; I’m just stating what should happen, based on historical precedent. Some if not all would normally report on the 14th, instead but that’s Good Friday and a holiday, before Easter Sunday, on the 16th. So brace for some warnings, and don’t expect the market to do much of anything. There are a lot of managers waiting for stocks to give them a chance to get in. That will limit the downside but don’t expect much to the upside until after this week is over. With end of quarter always comes some portfolio repositioning, which often provides a leg up to the finished quarter’s worst performers, and those expected to perform the best during earnings season. Unless you have an inside edge—a legal inside edge—pick your places very carefully.

ECONOMIC: (Highlights only below. Full International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

  
March 27—31, 2017   TRUMP DOES NOT WALK ON WATER, AFTERALL!   Former Pres. Obama and the Democrats must be jubilant about ACHA, the Republican repeal and replacement of ObamaCare went down in flames—without risk of a vote that even the Republicans knew would fail. OF course, stocks will get hit Monday morning, at least to start, because it puts the entire Trump agenda into question. Let’s not forget the $337B over 10 years the ACHA was supposed to save was, supposedly, essential to tax reform, and had to be enacted first, before tax reform could be attempted. Well, forget all that, which Trump never sounded convincing saying, anyway. Republicans are, now, going to attempt tax reform as if the Freedom Caucus, which was instrumental in shutting down the government, a few years ago, are going suddenly let the National Debt explode. And if the Dems are smart, they'll let the Republicans blow up all Trumps plans without any Democratic interference.

Speaking of the national debt, the US Treasury is offering $193B more of it, this week, more than twice last week’s offerings. How will that go? Well, perhaps, not that badly, until the $26B 7-year issue is encountered, Wednesday, a manageable amount, particularly given negative rates in much of the rest of the developed world. And don’t look now but Fed speakers will be crawling all over the world, this week, starting with Evans in the wee hours of Monday, in Madrid, and then later that day at a different conference. Data includes the Case/Shiller 20-city Jan Home Price Index, Tuesday, then Nat’l Association of Realtors offer Feb Pending Home Sales Wednesday, same day EIA releases weekly Petroleum stats, and a day before UK’s Prime Minister May will, finally, invoke Article 50 of the Lisbon Treaty, kicking off negotiations with the EU on the UK’s exit from the EU. As May said, after last week’s terrorist attacks at the Parliament, no matter what, there has to be a security pact, no matter what else they can’t agree on.

And make no mistake, despite the swarming Fed speakers this week, what May will trigger Wednesday, and her terms for post-Brexit regulation in the UK, is probably more important than anything else, in the coming week. And that may well be why money center banks were hit, last week. Most of them have their "European" headquarters in London, and it’s possible that won’t be acceptable to the Europeans, who don’t want see trades from the continent continued to be cleared in an island that was first defect. All last week there were articles about banks considering Ireland as an alternative, which sounds like anything but London, rather than a move to Europe. For what it’s worth, most of the Fed speakers probably won’t discuss their outlook for rates, but some will. Be afraid that some will join Evans in calling for, possibly, 3 more hikes this year, assuming the data holds up. And, at least, for the doves, the sole dissenter against the last rate hike, Neel Too Big To Fail Kashkari also speaks this week, if not until Friday.

There are also 2 consumer sentiment surveys out this week, the Conference Board’s on Tuesday, and Friday’s final U.M. March version, Recall the wicked snow storms and tornadoes that all but paralyzed different parts of the country, in March, and don’t be surprised if sentiment backs off some more. Recall, it was the first day of spring when New Englanders woke up to feet of snow outside. Consumers actually spend more when they’re most unhappy, so don’t be misled into thinking that worse sentiment is bad for restaurants, retailers, and "non-store" retailers—as the government bean counters like to call internet retailers. Then, again, as of April, the ECB starts trimming its QE to Euro60B from Euro80B, monthly, while recent strength in the yen may or may not have been related to end of year repatriation. Barbara Rockefeller of Rockefeller Treasury Services long questioned yen strength in March correlated with fiscal year end but this year said it doesn’t really seem to be a big influence. What if it was, the very year she threw in the towel on the observation? Wouldn’t the yen, now, back down, some?

The Earnings Calendar is finally slimming down, though not totally devoid of interest. I highlighted GIII on Monday morning, because Walmart is its biggest customer. WMT is, allegedly, making another big push into apparel, for which GIII is one of the companies it’ll turn to—especially for leather jackets for spring. Monday afternoon, RedHat & Synnex caught my eye, the latter one of the biggest VAR’s, more familiar to consumers when it operated Tiger & CompUSA, after the latter’s bankruptcy. It didn’t take either of those names when it discontinued its consumer push because it didn’t have to for its Enterprise customers. Tuesday, Carnival Cruiselines, Darden Restaurants, and spice distributor McCormick caught my eye, as well as FDS & INFO (IHS Markit), because Wall Street loves to navel gaze. Wednesday, Paychex in the morning, and Worthington, a steel company in the afternoon. Thursday, Dell Technologies, the stub for VMware was it, and newly public J.Jill, though how J. Jill pulled off an IPO given sentiment on retailers remains quite mysterious. Friday, Bank of China & Blackberry, neither emboldened because they don’t really mean squat for any other stocks or an index.

I’m underwhelmed by the Events planned this week, though Scotiabank’s Howard Weil Annual Energy Conference, in New Orleans, could be the star. I’m actually partial to buying multiple months out calls on Chevron, my favored play in the oil patch, since oil tends to rise into May’s air conditioning & summer driving season—even when the commodity is collapsing. And if you don’t mind paying the premium, calls out to Jan. are a possibility but I prefer to wait on those until after September. It takes a big hurricane heading for the Gulf of Mexico to raise oil prices, reliably, in summer months, after the driving season has already been discounted. Monday, CinemaCon for theater owners, and content purveyors is often one of the noisiest events of the season. Trailers and previews of summer blockbusters—even fall upcoming blockbusters—are shown to the National Association of Theater Owners, NATO, believe it of not.

I’ll throw some shade on Monday’s Payments, in Orlando, & IWCE-MRT Wireless Communications Expo in Las Vegas but Samsung’s release of Galaxy S8, Wednesday, could mean more. William Blair’s Cancer Immunotherapy Conference could benefit from the NY location, given how many analysts and hedge funds are based within 50 miles. If you enjoy trading tight sectors, the Jefferies Animal Health Summit, also in NY, Thursday, may be your cup of tea. RBC Capital is hosting a Forest Products Investor Day in Toronto, Wednesday but don’t be put off by the Canadian location. There’s a potential fight brewing between US & Canadian timber producers, just as the US homebuilding industry gears up full speed for the spring & summer building and buying season.

For Northeast events, it’s probably Thursday’s SEMI’s (Equipment) annual Wafers to Wall Street—Industry Cycles & the New Normal, albeit in Massachusetts but coming straight off Micron Tech’s blow-out earnings report, and with Cypress Semi hosting an analyst meeting, Tuesday afternoon, and Intel its "Leading at the Edge, a Technology & Manufacturing Day," also Tuesday, Semi’s should not be overlooked—they led to the upside and aren’t far from their all time highs but if stocks are going to suffer more damage after Trump’s failure on healthcare, the SOX may be the clue to how deep that pullback will be. Friday, SNAXPO for snack makers is the headline event, even though it appears only PepsiCo has managed to overcome any health kick the US goes on early every year. With March Madness well underway, it’s salty snacks, beer, soda, and pizza delivery that usually benefits most.

The big Kahuna of events starts next Saturday, AACR—the American Association of Cancer Research Annual Meeting, in the nation’s capital, just in time for cherry blossom blooms. That’s even as the FDA is expected to vote, Wednesday, on Genentech’s BLA 761064, for a duo of biologic drugs combined for injection, to fight follicular lymphoma, as a first line treatment. The bears have waited ever more anxiously for the Trump rally to break, and it seems it has. But don’t doubt the bulls intent to buy the dip–an undercut of 2300 in the S&P perhaps the signal they’re waiting for. For a tell, watch JNJ. That stock was one of the hottest in March, taking off even as 3 juries found against it for tens of millions of damages, in both metal hip and talcum powder cases. Of course, JNJ will appeal but the way it took off to the moon was quite surprising, given how poorly the stock performed after its last earnings report. When they cream JNJ, and it won’t go down more, that might be a signal to buy. Meantime, oil has lost a lot and oil stocks haven’t, this round. Buying June calls on Chevron appeal most, if oil dips to $46. Implied in that comment is a suspicion that oil has more gains to surrender, still, even if the Production Cut Monitoring Committee Meeting in Kuwait did end with a proposal to extend the OPEC & non-OPEC Production Cuts for another 6 months.

And just in case you missed it, the SEC voted to eliminate T-3 settlements by shortening them by one day to T-2, as of September 5th, of this year. Now, all they need to do is shortening the time for reporting short interest—eliminating the long lag before those are reported to the public.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© 2017 Sandi Lynne Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions are the author’s, alone, and should be just one factor in more complete due diligence.

March 20—24, 2017  CONSOLIDATION COULD CARRY TO THE END OF THE MONTH   The Fed may have lengthened the quiet period in advance of meetings but Fed heads are speaking everywhere, this week, in the aftermath of a quarter point hike that was widely telegraphed since early this month. Evans gets things started, Monday, George & Mester Tuesday, FOMC Chief & Neel Kashkari on Thursday, along with Kaplan at a separate event, plus on Friday NY’s Dudley, Evans, Bullard, and Williams. We’ll see if there’s a unified message to come out of them, ex-the dissenter, Kashkari. Also on deck, this week, FHFA Jan House Price Index & NAR Feb Existing Home Sales, Wednesday, then Feb New Home Sales on Thursday. The Senate Judiciary Cmte holds hearings on Supreme Court nominee Neil Gorsuch, Monday, along with a House Intelligence Cmte meeting that day, to query FBI director James Comey on Pres. Trump’s allegations of Trump Tower being bugged by the Obama administration, during the election season. The latter was roundly denied all around but the White House claims it will submit proof. "Alternate Facts," I suspect.

The Earnings Calendar winds down with mostly the 2nd string reporting. In fact, some of the most interesting of the reports won’t even be from American companies but instead from Chinese telecoms, BMW, Petrobras, CNOOC, and Tencent. But Francescas, General Mills, Land’s End, and Lennar will lead off Tuesday morning, with Fedex, Nike, and Silver Wheaton, in the afternoon. Thursday, I’d not ConAgra and Ping An Insurance. Thursday afternoon, GameStop, KBHome, Micron Technology, and Oxford Industries caught my eye, while Friday, it’s Finish Line, which has fairly consistently lags FootLocker.

Which brings us to the Event Calendar, if you can tear your eyes away from the NCAA Basketball game of the day. The first trades after the Quadruple Options & Futures Expirations are usually head fakes in the wrong direction. Once the Street can turns back to the Calendar, there’s no single defining event of the week. CAGE? Consumer Analyst Group of Europe? NYSSA Insurance? Tuesday’s a big day, with Wells Fargo’s Asset Managers, Brokers & Exchanges Forum, Goldman’s Houston Chemical Intensity, Telsey Advisory’s 9th Annual Consumer Conference, NAREIM for the Nat’l Ass’n of Real Estate Executive Leadership Retreat, and Solar Power Finance & Investment catch the eye, while both OpCo’s Annual Healthcare Conference and Morgan Stanley’s Healthcare Corporate Access seem too similar to a long list of healthcare conferences already completed. I’d rather trade the medical society meetings directly, especially Leerink Patners’ Biotech Mountain Meeting or Cancer Immunotherapy, or later in the week’s AAGP Geriatric Mental Health Care, depression at the root of much of the opioid addiction problem in this country, a fact few bother to acknowledge. Also notable Thursday’s Lung Science Conference and Hinman’s Dental Meeting, or European Biosimilar Medicines, and thr 15th Lung Scienve Conference.

On Wednesday, I’m particularly partial to the Hunter Hotel Investment Conference, an annual Atlanta event, not as big on the Nat’l Investment Center for Senior Housing & Care Industry, an event I think will grows in importance as boomers age but not yet. I have higher hopes for Gabelli’s Specialty Chemical Conference, that day, PIDA’s Global Pet Expo no longer a large enough public group to matter much.

As for stocks, I don’t see a catalyst to drive the major averages higher, still. Rather, with earnings warnings season creeping closer, I’d rather hedge the downside, and not expect too much to the upside. The last FOMC meeting and rate hike was so well telegraphed even I predicted it a week before the meeting. Markets still need a period of digestion. And that may be the story for the rest of the month.

ECONOMIC: (Highlights, only, here. Full International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

March 13—17, 2017  IS THIS TIME REALLY DIFFERENT?    Three steps and a stumble has always been the watchword on Fed rate hikes but it’s rare that the first two arrive a year apart, and rates haven’t started at zero, previously. It’s hard to argue the Fed hasn’t realized its stated goal of full employment and economic growth with price stability, even if the details behind that 4.7% Unemployment Rate aren’t nearly as bullish as the headlines. But it’s also was easy enough to guess has much the FOMC Chief Yellen & Co. want to get rates hikes in when they can, before Brexit’s Article 50 of the Lisbon Treaty is announced, and before French elections start in April. For all the hoopla about back to back strong employment numbers to start of 2017, GDPNow is suggesting the economy is growing at the same old, same old, pitiful sub-20% rate, despite all Trump’s promises and bluster. But the need to get hikes in when they could was exactly why I said, last week, that I expected the FOMC to raise rates this week, back when the odds of that happening was still in the neighborhood of 26%. What the Fed did wrong last year was wait until Brexit won out, in June, which eliminated hikes in the summer, while fall was eliminated by an ugly political season, that got even uglier as the election neared, last November.

Trump’s 2018 budget is due out any minute, as the CBO scoring of Ryan/Republicans/ Trump’s Obamacare replacement bill. Both could be out early this week though I suspect Trump isn’t submitting his 2018 budget until the CBO has scored the American Healthcare Act, which I think we should all call "Republicare." This one the Republicans will own, completely.

But the Fed isn’t the only central bank on the schedule. The BoJ meets Thursday (overnight Wednesday, in the US), as does the BoE, though Carney’s post-meeting press conference will take place just as CNBC opens the 7am hour. But that’s not all, there’s also the Swiss National Bank & Norway’s central bank meeting overnight Wednesday, into the US Thursday morning, the day after the FOMC has—we’re all sure—raised rates. And the Economic Calendar isn’t without some items of interest, including the Labor Market Conditions Index, Monday, Tuesday’s NFIB March Small Business Optimism Index and Feb PPI—Final Demand, Wednesday’s Feb CPI & Retail Sales, along with the NAHB March Housing Market Index. That should be a puzzle as weather in the north east ranged from high 60’s to preparing for a blizzard. It’s ironic that the G20 Finance Ministers & Central Bankers are supposed to meet in Germany, starting Friday, which just happens to be Saint Patrick’s Day, besides, one of the most bullish days of the year, historically. Of course, with a Quadruple Expiration that day, with quarterly futures & options settling, and S&P rebalancing, based on Friday’s closing prices, there are no assurances that St Pat will prevail. Also later in the week, Thursday’s Feb Housing Starts & Building Permits, plus JOLTS, a measure of job turnover & quits, quits seen as an optimistic sign from workers who have to be confident about obtaining a new job, to quit the one they’re already in.

Anyone who isn’t interested in the early rounds of March Madness—the NCAA men’s basketball championship, could always go to the movies and see "Betting on Zero," a documentary about Bill Ackman’s/Pershing Square’s bet against Herbalife (HLF), which opens next weekend. While Carl Icahn & HLF CEO Michael Johnson wouldn’t sit for interviews, for the film, there was plenty of archival footage the filmmaker could use, much of it from CNBC.

The Earnings Calendar is more voluminous than it should be, at this stage in the season but little of it will move markets. I’ve got Hostess (TWNK) highlighted because I’m its most devoted fan, and can’t have my morning coffee without a chocolate Hostess Cupcake—except when I’m in NY and one of the massive chocolate croissants will do, instead. HD Supply, caught my eye Tuesday morning, along with Jabil Circuit, Oracle & Williams-Sonoma Wednesday afternoon, along with Dollar General Thursday morning, and Adobe and Calares (formerly Brown Shoe), Thursday afternoon, along with Tiffany Friday morning. Aside from that, you have to be more familiar with small biotechs, than I am, to go fishing amongst those reporting.

The Events Calendar promises Dialysis, Gerontology, Diabetes/Hypertension & Metabolic Syndrome, Womeon’s Cancer, Next Gen Immuno-Oncology, a Japanese and Taiwanese Human Genome Meetings, AAOS Orthopaedic Surgeons hold an Annual meeting, along with Clinical Pharmacology Therapeutics, Pain Medicine, Thoracic Cancers, and the really big one, starting Friday, Cardiology. And that’s even as the ROTH Conference will include some healthcare, while Exane BNP Paribas hosts Healthcare in Paris, Barclays hosts Global Healthcare, starting Tuesday, with AAOS where the most companies will host analyst meetings. Oddly, Amgen, not known as a cardiology company, even as Repatha (AMGN) & Praluent (SNY/REGN) get off to a slow start, is hosting analysts at ACC, the Cardiology Annual Scientific Sessions, because its latest post-approval test results show its super statin, Repatha, does, indeed, prevent heart attacks and strokes.

Other events of interst include JPMorgan’s Aviation, Transportation & Industrials Conference, in NY, starting Monday, when Seatrade Cruise Global kicks off. Barron’s anticipated Seatrade by writing bullishly about Norwegian CruiseLines but with only 3 tickers to choose from, and prospects for them all looking up, terror attacks in Paris & Belgium get farther away in the rearview mirror, it’s the tight event that’s easier to trade than most. Bk of America Merrill Lynch’s Consumer & Retail Technology Conference, starting Tuesday, along with Barclays’ Global Healthcare, has competition from Longbow Research’s Construction, Basic Materials & Building Productions, and Barclays’ Emerging Payments Forum, while CanaccordGenuity hosts a Musculoskeletal Conference, in San Diego, to coincide with AAOS—the aforementioned Orthopaedic Surgeons’ Annual meeting.

Come Wednesday, it will be all about the FOMC Statement, and Yellen’s press conference, along with the SEPs--each member’s forecast for the economy & rates, with a possibility some will move from 3 hikes this year to four, though I don’t think Yellen will, yet. The Trump administration hasn’t done anything, yet but summon corporate CEOs to White House meetings, and bungle the first attempt to ban immigrants from Muslim countries for 90 days. The raw Ryan Republicare replacement for Obamacare doesn’t look like it’s going to fly—no matter how good a negotiator Trump thinks he is. Meanwhile, the Atlanta Fed’s GDPNow has come down dramatically, now at almost 1/3rd of where it started in its forecast for 17Q1 GDP. The NY Fed’s version is still up there at 3.2% (
FRBNY Staff Nowcast) but likely to come down significantly, also, this week, especially if the nor-easter dumps a blizzard on the north east, just as it was looking like spring had sprung, up there. The St Louis Fed cite the Atlanta Fed’s GDP very precisely, at 1.2457%. That’s barely better than the last 2 years, though GDP, admittedly, printed at 1.1% in 2016Q1, and in 2015Q1, fell at a rate of (-0.2)%. Even if the Atlanta Fed’s GDP Nowcast is accurate, it still beats the 2 prior years.

Get past the FOMC meeting, Wednesday, and the Quadruple Options & Futures Expiration will be controlling stocks, rather than any earnings, events, or economic data. St Patrick’s Day is, traditionally, a bullish holiday but occurring on a BIG Expiration, coinciding with S&P Rebalance & Qtrly Options & Futures Expiring, traditions could be upset. Historically, the bullish day is the Tuesday before the Quad expiration, sometimes even Wednesday but with the FOMC a major distraction until Yellen’s press conference ends—usually around 3:35pm—stocks won’t be driven by the rate hike that’s already anticipated, or even the fact that one of two SEP outliers could switch from 3 hikes this year, to 4. And if truth be known, it’s not the meeting statement but the forecasts and, even more so, the minutes out 3 weeks after the meeting that the Street will find most revealing.

I would normally cite chart levels, about here, after the consolidation I’d been expecting finally showed up, last week but, alas, my data provider has been off line since last Wednesday, and I simply don’t trust my back-up systems for making big calls. Believe or not, even as the Earnings Calendar remains busier than it should be, Q1 is drawing to a close and it won’t be long, now, before companies other than retailers start issuing warnings. Personally, I don’t see any urgency to buy this first dip, yet.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the authors, alone, and should be just one factor in more complete due diligence.

March 06—10, 2017  LONG WEEK WAITING FOR FOMC NEXT WEEK  This could feel like an exceptional long week, waiting for Friday’s February Unemployment Report, before the FOMC meeting, the week afterwards. That, also, means the ECB meeting, Thursday will take on added importance, especially after last week’s news that the Eurozone grew faster than expected. Meanwhile, Sunday’s press comments by China Premier Xi, before the NPC—National People’s Congress, held no surprises. None.

One of the highlights of the Economic Calendar, while waiting for the ECB & Friday’s US Unemployment Report may well be the US Jan. International Trade Deficit, on Tuesday, along with the Trade Balance released by Germany, well earlier than the US market’s open, on Friday morning. Germany, one should recall, has been accused of holding down the value of the Euro, to benefit from trade, according to US Pres. Trump. And it’ll probably pay to watch the Treasury Auctions, this week, whether the 3-year, on Tuesday, the 10-year on Wednesday, or Thursday’s 30-year. $12B of 30-year bonds shouldn’t be a challenge to sell but with rates set to rise, a week after the auction, it’s not a lay-up, either, and dealers could get stuck holding the bag.

There’s a fairly voluminous Earnings Calendar, even so late into the Earnings Season, which may not turn out as important as some of the analyst meetings scheduled for the week. In particular, Tuesday’s Chevron and IBM analyst meetings, Amex & GE Wednesday analyst meetings, before Friday’s United Technologies’ meets with Analysts, rounding out a handful of DJIA companies who’ve scheduled meetings with institutional investors and analysts. There isn’t a single company reporting earnings, this week, with equal clout—or even a fraction of the clout.

The Events Calendar cranks up, as is typical when Earnings season tails off. One of the biggest events of the week is AAAI, the American Academy of Allergy, Asthma & Immunology, taking place in Atlanta, and already underway. What’s curious about the event is how little it has been previewed, by analysts. Ditto the 75th American Academy of Dermatology, also underway, in Orlando. The lack of pre-event buzz is quite surprising, compared to past years. One wouldn’t think NABE—The National Association of Business Economists would be that big a deal but NABE, for years, has been a high profile event for top notch speakers, this year no exception. In some circles, the speakers are so well known their last name is all that’s necessary for identification. Hubbard, Furman, Levy, Stiglitz, Stockton, and Zandi, along with Neel Kashkari, the President of the Federal Reserve Bank of Minneapolis, who’ll be speaking Monday, at 3pm, though Too Big to Fail doesn’t seem to be in any way related to his planned speech, a rare departure from his usual thrust.

The biggest events of the week are likely a few core investment bank events, starting Monday, with Deutsche Bank’s 25th Annual Media, Internet & Telecom Conference, in Palm Beach, Florida. Getting there must not have been easy, with Pres. Trump popping in and out of Mar-a-Lago, and all the air restrictions in place each time he arrives or leaves. Also Monday, CERA Week, now an IHS Markit event is one of the bigger energy events of the winter. Cowen’s 27th Annual Health Care conference is, likewise, eagerly awaited. Tuesday, note RBC’s Financial Institutions Conference in NY, and Evercore ISI’s Energy/Power Summit, not accidentally in Houston, during CERA Week. Also Tuesday, the Digital Hollywood Media Summit, in NY, could be one of the biggest and best attended events of the season. Think of how easily Cannes attracts every celebrity, and that’s Digital Hollywood in NY, mosquito paper for media CEOs and programmers, with big wattage names all speakers. It appears Wells Fargo is the only I-bank setting up at Satellite 2017, which starts Monday, in D.C. When I saw the American Coal Council Spring Coal Forum on the schedule for Tuesday, I wondered how many attendees it might have drawn if not for Donald Trump’s decision to open coal markets by eliminating some of the costly scrubbing technology the Obama EPA had ordered mandatory on coal fired power plants, causing some to plan to mothball coal power plants. Raymond James' 38th Institutional Investor Conference starts Sunday, and runs through the 8th, with a hodgepodge of presenters that can't be pigeonholed. They range from Callaway Golf to CME, to Allergan, Mobileye, Moody's, MSC Industrial Supply, Delta Airlines, PulteGroup, Natus Medical, Aflac, Vocera, SS&C, Chegg, Malibu Boats, MAXIMUS, Alexion Pharmaceutical, Iridium, TD Ameritrade, IPG Photonics, Mobile Iron, Masco, Home Depot, Weyerhaewuser, Catalent, Union Pacific, Newtek Business Services, Impax Labs--you name it. There doesn't seem to be any particular sector or market cap either excluded or included. It covers the gamut, and runs for more days than most conferences. .

On Wednesday, the headline I-bank event is UBS’ Global Consumer & Retail Conference, in Boston, though don’t dismiss, out of hand, the Mitsubishi Tech Tour on the West Coast, starting Monday but running through Thursday, as it moves from Seattle to Silicon Valley, and involves Amazon, Microsoft, Zilloa, Ambarella, Google/Alphabet, Applied Materials, Broadcom, Cisco, Electronic Arts, facebook, Intel, Netflix, nVidia, Salesforce.com, Visa, VMware, Workday, and more, as the schedule below details. And that’s with Google holding Cloud Next, in San Francisco, starting Wednesday, as well. Likewise, not Thursday’s FirstEnergy East Coast Energy Symposium, in NY, plus Susquehanna’s Chemical Conference, in Boston, as well as its Annual Semi, Storage & Tech Summit, in NY.

And while we’re at it, even as Obamacare seems on death row, the 2017 Medicare Marketing & Sales Summit starts Monday, in Orlando, while AHIP, for American Health Insurance Plans starts their National Policy Conference & Health Insurance Exchanges Forum, in D.C. on Wednesday. There’s no other way to put it—both events strike me as awkward, for lack of a better word, at the moment. And that’s even in the face of a DoJ that blocked 2 healthcare mega mergers that the outspoken President hasn’t tweeted to reverse, as yet. Note the weekend’s Wall Street Journal article about the lack of appointees to the FTC and DoJ, which it concludes, is reason enough to suspect some mega mergers still awaiting approval, including AT&T’s takeover of Time Warner, must wait longer. Meanwhile, CenturyLink Telecom’s merger with Level3 seems poised to fly through, with the shareholders’ vote coincident with the FOMC’s mid-month meeting, ballots now in shareholder hands.

And with that, another week of consolidation should be ahead, with no good reason for stocks to add to recent gains, immediately. Trump doesn’t seem ready to submit his budget plan, imminently, while the replacement for Obamacare doesn’t appear ready to drop, either, at the moment. I’ll point out, though, that while most think the FOMC December rate hike was taken in stride, without any undo pressure on stocks, that’s not wholly true. Stocks, instead, spent weeks consolidating post-Election gains, before they took another step up in January, before really getting into orbit, last week, after Trump’s appearance before the Joint session of Congress. . Even though stocks seemed to all but ignore, last week, Yellen & Co’s plain spoken warning that rates are going to rise, at the March meeting, I expect another bout of consolidation around the March 15th meeting announcement and, perhaps, even a little more profit-taking than we’ve seen to date, since the post-Election rally got underway. Stocks seem set up perfectly for call overwrites, to take advantage of a rally that will rest for weeks, at least, in the most benign scenario. In a less benign scenario, profit-taking could finally pick up steam, especially as earnings warnings start creeping in towards the end of March.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar, here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.
  
            

February 27—March 03, 2017 
TUESDAY, Pres. Trump Addresses Joint Session of Congress (US Capitol). Yellen and FOMC Members Blanket Friday’s Inflation & Monetary Policy Forum, too!   Is there some irony that the most flamboyant and largest crewes wrap up Mardi Gras, Tuesday, as the entertainment President, Trump, takes the podium to address a joint session of Congress? Will there be Lent, thereafter, a fasting from Twitter and self-congratulations, until Trump, Mnuchin, Navarro, & Congressman Ryan can patch together a "replacement for Obamacare," required we’re told, for them to, then, proceed to tax cuts? In other words, will Trump use Twitter less and get down to real business, rather than the showy summons to the White House of powerful corporate chieftans and world leaders, alike?

One thing for sure; Wall Street wants substance from Trump, and not just more hyperbolic praise for everything he claims he’ll get to, while calling anything and everything related to past administrations a "disaster." The Street simply won’t be sucked in, anymore, by Trump’s claims to "phenomenal" or "the greatest" plans, rather than the plan, itself. And of course, one can’t think of the US biggest Mardi Gras celebration without thinking, too, of Santaria & voodoo, if for no other reason than those subjects are frequent fulcrums in TV crime shows, NCIS Nolo, in particular. Another connection to Trump? His voodoo plan to raise spending for illegal immigrant capture, better immigrant vetting, to put the US nuclear arsenal "on top," and wiser but still more spending on the military, yet simultaneously, lower the Federal Deficit & debt? No lesser economist than Larry Summers has called Trumps plan voodoo economics.

Why is the BLS releasing the February Employment Report on March 10th, instead of March 3rd? That’s quite unusual, unless it has something to do with the FY 2016 Annual Regional & State Unemployment Report at 10am on 2/28. Still, in an age of computers, the late release puzzles. .

FOMC members, now blacked out for an extra 3 days prior to meetings, obviously want to get in as many opportunities as possible, before the gag starts next Saturday. Kaplan kicks it off Monday, as a panelist with Q&A in Norman Oklahoma. Fed’s George, Billiams & Bullard speak Tuesday, though we know attention will be focused on Pres. Trump’s appearance before a Joint Session of Congress, that night—the night the Street wants to hear more details on tax cuts and his budget, rather than additional hyperbole.

Friday, is the big day, with three FOMC Members speaking--V Chair Fischer, plus Chicago Fed Pres Evans & Richmond Fed Pres Lacker, discussing the 2017 report on inflation expectations & dynamics, prepared by Stephen Cecchetti (Brandeis), Michael Feroli (JPMorgan), Peter Hooper (Deutsche Bank), Anil Kashyap (U of Chicago), Kermit Schoenholtz (NYU Stern School). Fischer keynotes, so speaks first. Evans & Lacker at 10:15am, in a discussion moderated by the Dallas Fed’s Kaplan, and clearly, an event at which the Fed could drive home the probability of a March rate hike, given the entire conference revolves around a discussion of a report on this year’s inflation expectations & inflation dynamics. The conference brings together academics, market economists & policy makers, just 11 days before the next FOMC meeting starts, at a time when Unemployment at 4.7% leaves only inflation below the FOMC’s target. Other speakers include the Bank for International Settlements (better known as BIS), and, as yet unconfirmed, BoJ’s Hiroshi Nakaso, #2 to Kuroda. (See Eco Calendar for link to the conference) And, then, Janet Yellen, herself, will speak on Friday, in Chicago, so more than a minor opportunity for March to be driven home as a "live" meeting.

So it’s said, I expect the FOMC to raise rates in March, if for no other reason than I believe it plans to raise when it can, since there are so many months when it may not be able to—like in May, and possibly June, after the French run-off election, a run-off a near certainty. I think they might have regretted not getting to it before last year’s Brexit vote upset their plans, keeping them on hold until December. But, of course, that overlooks, for the moment, PM May’s plan to invoke Article 50, in March, with the effects of that unknown, even though the time frame has been long telegraphed, the month if not the exact day, and as we saw after the Brexit vote, itself, last June, the immediate reaction may not be the lasting one. Not only did equity & currency markets recover fast but the UK economy doesn’t appear to have been dinged, since. So, barring an extreme reaction to Article 50 finally being put on the table, perhaps even earlier in March than the FOMC mid-month meeting, I still think the FOMC moves, despite how much it hates surprising markets, which currently price in slim chance of that. And know that I have a perfect record on the FOMC—perfectly and inarguably wrong, at every turn. The FOMC has never done what I thought they would, when a change or tweak to policy was on the table. All of these Feds speakers are just getting in their appearances before the newly initiated Black-Out period, of 2 Saturdays before the meeting, a full 10 days, instead of the week it used to be, so plenty of time for Yellen & Co to drive home a change in rates in March, if they so desire. Of course, if they do no such thing, markets could really rock to end the week, celebrating a Fed still on hold. And who knows? The markets could need some soothing, depending on how Trump handles his speaking turn on Tuesday. Note, also, Treasury Secretary Mnuchin’s first FSOC conference, Thursday. Discussion will center on setting out criteria for non-bank SIFI designations, the lack of criteria criticized by the court when MetLife was able to shake off the designation. That could tee up a rally for Friday, if the FOMC Members speaking to drive home a rate hike in March.

Other than the FOMC speakers & Trump, the other biggest events of the week will include February Motor Vehicle Sales, Wednesday, and the Fed’s Beige Book, later that day. Jan Personal Income & Expenditures includes a version of PCE, as well as the national savings rate. Curiously, Jan wages didn’t rise as much as one would have expected in a month that included bonuses & 18 states initiating minimum wage boosts. PI & E might fill the gap. Normally, we’d all expect the February Unemployment Report to be released Friday but for mysterious reasons, the BLS is holding that report until March 10th. Challenger, evidently, didn’t get the memo, since it’s still going to release its Feb. Lay-off report on Thursday. Perhaps the BLS will be too busy preparing the 2016 Annual Employment Revisions & Report to deal with Feb this week, Tuesday, along with the 2nd crack at 16Q4 GDP, and S&P Case/Shiller Dec 20-city Home Price Index. Monday, we’ll get Jan Durable Goods Orders & Shipments, as well as Jan Pending Home Sales but with half the country blanketed under feet of snow, there’ll be large portions of the country that weren’t holding open houses for shoppers. The Bank of Canada monetary policy committee will release its decision on rates, Wednesday, which is more side show than main event, for this week. The EIA weekly Petroleum Report is likely to trump BoC.

Big industry and investment bank events this week include the Mobile World Congress, already underway in Barcelona. Samsung isn’t releasing the Galaxy S8 until late in March, while Apple, of course, is not even there. Neither is Verizon, for that matter, because MWC is a GSM conference, and VZ, alone, doesn’t use GSM. Morgan Stanley hosts a European TMT even to coincide with MWC, even as it hosts another in San Francisco, starting Monday. Also already underway, NGA, the National Governors Winter Meeting, with Trump hosting them for a White House dinner Sunday night, the reason he won’t be able to watch the Oscars as intently as he usually does—how will Twitter survive?

Tuesday, Citi hosts an Asset management, Broker Dealer & Market Structure Conference, in NY, while JPMorgan is in London host "Investment Companies," which should overlap. Evercore ISI will host its annual Industrials Conference. On Wednesday, JPMorgan will host Gaming, Lodging, Restaurant & Leisure Management Access, just as hoteliers finish up reporting, this week, including LaQuinta & Extended Stay. Bk of America Merrill Lynch will host Global Agriculture & Chemicals, starting Wednesday, in Ft Lauderdale, a place that’s hot like summer, this week, after a short but pleasant winter that was gone too soon, down here. Piper is staying in New York for its Annual Energy Conference, where Morgan Stanley, likewise, is hosting MLP/Diversified Natural Gas, Utilities & Clean Tech. Let it be known the world of Clean Tech will be mostly in Tokyo, where Smart Energy week will take place. But otherwise, Energy will be heavily covered, not just in NY but in Dallas, where EnerCom is hosting its annual Investment Conference, while M.I.T. hosts an annual Energy Conference in Cambridge MA, starting Friday. M.I.T. covers everything from oil & gas, to solar & automobiles, including the IEA Secretary General, and execs from Nat’l Grid, Schneider Electric, General Motors, GE Ventures, Chevron Nigeria Ltd, EDF Renewable Energy, Ford Motor, Canadian Solar, and so much more. Also Wednesday, Wells Fargo is going to host its 20th Annual Real Estate Securities Conference, in NY,. NY will be home to Mitsubishi UFG’s Property REIT Corporate Access Day, even as NAREIM, for Real Estate management Executive Officers is schedule to begin a retreat, the same day, in San Diego.

One of the biggest events of the week is the Commodity Classic, which starts March 2nd, in San Antonio TX. It’s put on by several seed National Associations, i.e. for Corn & Soybeans, Wheat Growers, Nat’l Sorghum Producers, and many other farm crop products. The event includes just who’d expect:: Dow AgroScience, DuPont Pioneer, Syngenta, BASF, USDA, Bayer CropScience, Monsanto’s SmartStax Corn, John Deere, Penton Farm Progress, United Soybean Board/Soy Checkoff, Adm, FMC Corp, Am. Coalition for Ethanol, National Biodiesel Board, EMD Crop BioScience, Corn Growers Ass’n Awards Banquet, Genuity, StollerUSA, Egg Board, US Poultry & Egg Export Council, Kinze Manufacturing, and so many more. BIG farm event—perhaps the biggest of the year, "Farmer-led, farmer-focused."

Normally, the Street would be flooding the street with research notes in advance of Friday’s AAAI allergy, Asthma & Immunology but there’s not been as much as in some years past. Dermatologists also meet next weekend, starting with a Psoriasis specialty sub-meeting Thursday, before the Academy of Dermatologists opens their doors, Friday, for the full conference.

There are a few notable analysts meetings, this week, including JPMorgan Chase & Co Tuesday, along with Target that day, after it reports Q4 earnings. Wednesday, ExxonMobil, Hershey, Honeywell & McDonald’s meet with analysts. So does Mylan but there’s no reason to expect its CEO to have grown less tone-deaf since her Congressional testimony and the announcement of its own "generic" EpiPen at half the cost of it’s regular EpiPen, whose price was boosted from $50 for a pair of pre-filled syringes, to $900 for 2. And so it’s said, Nintendo’s new Switch debuts Friday, also. There hasn’t been much buzz about that, either though perhaps there will be, during GDC, which starts Monday. At the very least, Nintendo should have demo Switch’s around for gamers to test, at the event, given the global launch is dead ahead.

Which brings us to Earnings, about which we can start by saying Liberty Media/Interactive, SIRI XM Radio, QVC, and every other division will dominate, on Tuesday. I don’t know how investors or analysts keep all the Liberties straight. Malone, clearly, isn’t interested in streamlining. Monday, nods to American Wood Work, Armstrong Worldwide, and Sotheby’s pop n the morning, that afternoon a diverse group that ranges from Ensco, to FreightCar America, a couple of small restaurant chains, Kindred Healthcare, Priceline, and Western Refining. Tuesday, AutoZone, the Canadian banks BMO & Bk of Nova Scotia, Frontline Ltd, and Target, if they can get a word in edgewise, around Liberty, in the morning. That afternoon, Ambarella, AMC Entertainment, Big Five Sporting Goods, Chicago Bridge & Iron, Darling Ingredients, Palo Alto Networks, Ross Stores, and Salesforce.com, are just some of those reporting.

Wednesday morning, American Eagle Outfitters, Best Buy, Dollar Tree, Lowe’s, and suddenly popular Tribune report before the open, Luxottica mid-day, and that afternoon, Broadcom, MBIA, Monster Beverage, and Shake Shack are a few of the names that stood out. Thursday morning, Abercrombie & Fitch, Anheuser Busch, Barnes & Noble, Burlington Stores (No longer the "coat factory," evidently), Carol’s Restaurants, JD.com, Joy Global, Kroger, Noodles & Co, Stage Stores, and TD Bank. Thursday afternoon, expect AutoDesk, CostCo Warehouse Clubs, The Habit Restaurants, Marvel Technology, and Wingstop. Friday promises a slim schedule in which Big Lots and Revlon stood out for me, since consumer discretionary is my specialty. But I haven’t really done the Earnings Calendar justice. Perhaps because last week was a 4-day week, this week’s earnings calendar is far more voluminous than one would expect, this late in Earnings Season, when the vast majority of the S&P 500 has already reported.

So, with all that said, the bulls have to wonder whether they can depend on Trump saying something of substance, Tuesday, because if he doesn't, the market could struggle. If he disappoints, then add in the possibility that all those Fed speakers could talk up a March rate hike, and stocks could really get a rethink, and rediscover the downside. And one almost has to count on Trump disappointing, because he’s still campaigning—still trying to convince the world that he’s got what it takes, and he actually won the general ballot count (Hillary garnered 2.9m more votes than he did but not in the states that counted for Electoral College), if one disqualifies all the fraudulent votes that only he’s convinced occurred. Take a look at a chart of any of the major indices, and the moving averages that are far below current prices. That suggests a market vulnerable to disappointment, which I don’t think can be dismissed out of hand, this week.

ECONOMIC: (Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence. 

February 20—24, 2017 
CONSOLIDATION DUE     FOMC Minutes of the Jan 31—Feb 01 meeting would, normally, be the week’s highlight but I doubt that, this week. Unless the minutes include a lot more discussion about, possibly, raising rates in March, or beginning to unwind the Fed’s balance sheet, I doubt the minutes will offer much guidance or market moving details. Then, again, if the minutes raise the likelihood of a rate hike at next month’s meeting, or suggest members are itching to begin setting terms for unwinding some of the balance sheet holdings, the market should wake up from its complacency. In fact, the most remarkable facet of the current market is the utter complacency with which the Street is handling, or dare I say, cherry picking which Trump personality it chooses to ignore and which to notice. Whether one viewed Friday’s press conference, or caught snippets of his campaign rally, in Florida, Sunday, it’s fairly difficult to merely ignore Trump. He scares me to my core if for nothing else but his lack of impulse control, which allows him to shoot of his mouth as if he were in a locker room, rather than the world stage. Like Kellyanne Conway, just weeks ago, talking about Bowling Green, Sunday Trump referenced terrorism in Sweden that hasn’t occurred.

Of course, if Yellen wants a March rate hike to be taken more seriously, she has some troops out and about, this week, who can reinforce the point. Tuesday’s "Getting to Knew the Fed," at Boise State University, would be Williams’ chance, if Kashkari & Harker don’t beat him to it, earlier Tuesday. Wednesday, Kaplan is scheduled in Dallas, then Friday, Lockhart could look ahead as well as look back on his 10 years at the Federal Reserve Bank of Atlanta. And Fed Gov. Powell could get the job done, Wednesday, at the Forecasters Club of New York, where he’s scheduled to discuss his economic outlook & monetary policy, replete with a Q&A session, which is another feature of the earlier speakers’ schedule, as well. Wednesday, the National Association of Realtors will release January Existing Home Sales, then Friday, January’s New Home Sales. Thursday, the FHFA releases its December House Price Index, even as the EIA announces weekly Crude and Natural Gas stats, the former delayed by Monday’s President’s Day Holiday.

In fact it may not be data but Treasury auctions that attract attention, given that the schedule includes a nibble of 2-year Floating Rate Notes but, also, on Thursday, $28B of 7-year Notes. I wouldn’t commit to 7-year notes, this week, if I felt I had a better chance of obtaining a higher yield, shortly. All in, the US Treasury will be offering up $172B in various notes & bills, in a 4-day week, no less. Then, again, the UK’s auction of 10 year Gilts, before our market opens Thursday might be interesting, as well. How well the auction goes may hinge on Tuesday’s preliminary 16Q4 GDP, out that day. BoE’s Carney has admitted that the Brexit vote didn’t cause as much disruption as feared, so far, but there are some signs of uncertainty, particularly in housing.

The Earnings Calendar offers a fair weighting of lower tier energy names, including drillers, as well as hotels, restaurants, large & small retailers, foreign banks, homebuilders, and the realtors that sell their homes. But with Home Depot, Macy*s, and Walmart reporting Tuesday, I suspect they’ll attract the most camera time because most of the other groups named are sending in the second string, the starting line up already finished reporting. Wednesday, reports are expected from Chico’s Fas in the morning, L Brands in the afternoon, along with Sina, Tesla, Transocean, plus Weibo. Thursday morning, reports are expected from AMC Channels, Apache, Barclays, Repsol, Felcor Lodging, Glencore, Sanderson Farms, and representing retail, Gildan & Kohl’s. That afternoon, Baidu, Gap Stores, Herbalife, Hewlett-Packard Enterprise, IMAX, and Nordstrom stand out. Then, Friday, FootLocker, JCPenney, Magna International, Royal Bank of Canada, and the Scotland counterpart. For all intents and purposes, the Earnings season all but wraps, this week,

That brings us to the Events Calendar, where CAGNY (Consumer Analysts of New York) stands out, in particular. CAGNY always flashes like a neon sign on a back road motel but with Kraft Heinz already withdrawing the offer it made to Unilever, last week, and the most unusual Johnson & Johnson presenting there, as well, CAGNY promises added wattage this week. Out in Las Vegas, MAGIC is the headliner, with its many sub-shows, like Off-Price, Fashion Fabric & Sourcing, not to mention World Shoe the largest of the concurrent shows. Well, of course, the BAT—Border Adjustment Tax—gets a seminar out there but, as a former retailer, I think all the hand wringing about it is overdone. I’m not an advocate of the BAT but neither do I see it was the end of the world. Better retailers should find a way to make their retail prices stick, rather than triple the cost and offer 40% off a day after the merchandise arrives. For the record, Stephens & Citi have announced hosted meetings at MAGIC but even firms that haven’t announced formal events will be out there with clients, to walk the convention center.

International Petroleum Week will be held in London, starting Tuesday. Wednesday, Barclays Industrial Select Conference, Macquarie’s Gold Explorers Corporate Day, in Toronto, and RBC Capital’s Global Healthcare Conference will compete with the shiny new event—IQPC’s Autonomous Cars, in San Francisco, also starting Wednesday, while both NASS & ACTRIMS could outshine all but cars. NASS is for Spinal Surgeons, while ACTRIMS is for Multiple Sclerosis. Macquarie repeats Gold Explorers in New York, Thursday, with the US Dept of Agriculture will open the doors on its annual Agricultural Outlook Forum. That’s in Arlington VA, while INTL FCStone is also hosting Ag & Econ Outlook, in Vegas. Then, again, on that day, most healthcare could steal the show, with ASCO-SITC Clinical Immuno-Oncology, Houston hosting an annual Aortic Symposia, and the International Society for the Study of Women’s Sexual Health, all opening conferences. I didn’t bring up Healthtech’s Molecular Medicine Tri-Con, which started Sunday, only because it’s such a huge event, with so many tracks, it’s almost too big to handle. I’m partial to the more specific conferences, where it’s easier to identify a company, or two, that could stand out. And Thursday, the FDA’s meeting to consider approval for Claret Medical’s Sentinel Cerebral Protection System (CPS) adds some focus on the Aorta, because it’s meant to capture & extract any clots or other debris that might occur during TAVR—Transcather Aortic Valve Replacement—Surgery, which narrows the field to Edwards LifeSciences & Medtronic, the latter, as coincidence would have it, also reporting earnings, Tuesday. MDT pays EW a royalty, as a result of court judgment that found MDT did infringe on EW’s patented technology but did so with transcatheter devices that were different and necessary sizes. If Insurers are of interest, then note NYSSA’s Annual Insurance Company CIO Conference, because Aflac, Hanover Insurance Group, MetLife, Munich Re, and Prudential will be speaking. Even Goldman Sachs’ Asset Management division will be part of a CIO Roundtable, at NYSSA.

Maybe it was just the market doing what it does in advance of a 3-day weekend. Or, maybe it was something else but, after looking at the charts, tonight, I strongly suspect stocks are due for consolidation, if not some profit-taking. I am not ringing the bell at the top, by any means. There were many times, in the past month, it wouldn’t have been outlandish to call for a top but I didn’t have strong conviction, so didn’t mention it. This time feels different—the absurdity of stock indices ramping to new, successive, all time highs, simultaneously, on another of Trump’s hyperbolic promises, the most recent on tax cuts. With so much Treasury debt on offer, and the possibility that FOMC members will be out talking up a March rate hike, fresh off Trump’s latest alternate facts, on Sweden, it’s hard to believe the Street can remain so taken with promises on taxes, from a man who, often, sounds unhinged. And given that Trump’s promises are sure to increase the national debt, just as the FOMC seems intent on accelerating its pace of hikes, the bond "vigilantes" who’ll be pointing out the greater cost of larger deficits financed at higher rates are just one of the issues the Street will have to confront. Meanwhile, for traders wondering if retailers are cheap enough to buy in advance of earnings which are rarely as bad as the worst fears, I’d say don’t do it. The only chain with a strong presentation of spring merchandise is Forever 21, and that’s just sad. There is no reason for shoppers to come into malls, and they’ll be disappointed if they do.

ECONOMIC:
(Highlights, only, below. Full International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.    

February 13—17, 2017 
YELLEN VISITS THE HILL     It takes weeks to put together the 3 calendars we highlight, weekly, and this one is a little longer than usual. Yet, I could have saved myself the trouble and gone with the headline, and ended it there. Yes, Japan’s leader, P.M. Abe, will be departing, and Canada’s & Israel’s leaders arriving but, in the end, it’s Yellen’s testimony on the Hill that will determine how the week goes, and in particular, whether she emphasizes the fact that every meeting is a "live" meeting, which puts March on the table for a rate hike. Of course, a close reading of the most recent FOMC minutes and the last statement (The Feb 1st ending meeting minutes won’t be published until 2/22) makes clear that, aside from an uptick in sentiment, nothing about the economy had really changed, since election day. Yet, with a press conference attached to the March meeting, it’s already set up to be a "live" meeting.

Granted, the January Employment Report was stronger than anyone expected but, then, the recent snow storms will set back momentum. The biggest cities on the East coast came to a grinding halt, which is never good for the domestic economy. And corporate earnings are, surely, demonstrating better growth from sectors that lagged, even as energy companies should be ending their string of negative reports, with reports that will come in April, covering Jan. through March. And, if Yellen wants some support for positioning March as a "live" meeting, she has enough deputies speaking, this week, to help make the point.

Having established Yellen as the voice of the week, it’s worth noting that Jan PPI (Tues), CPI & Retail Sales (both Wed.) will be released, along with NAHB’s Feb Housing Market Index which, as I’ve already pointed out, could have ground to halt thanks to snow. Down here, in Florida, we’re benefiting from the bad weather up north, while enjoying the best "winter" weather in five years. We’re enjoying temps in the 70’s during the day, and very little humidity, and managing low to mid-60’s at night, the perfect conditions some move here to enjoy, though we rarely see it this good. For lower income consumers, the IRS starting to send out refunds for returns that included child & earned income credits, which are being subjected to closer scrutiny this year, in an effort to trip up fraudsters. The timing of tax refunds are often cited by retailers as an excuse for strength or weakness in late January and early February sales.

Away from the US, OPEC releases its Monthly Report, before markets open Monday, while that night, China will release Jan CPI & PPI. The Lunar holiday fell in late Jan., this year, which will skew the numbers, as it always does. Therefore, there won’t be any conclusions made about the early part of China’s year until February is, also, out because analysts & economists much prefer to use Jan/Feb blended data, to account for the annual differences in when the Lunar New Year actually arrives. This year it was Jan 28th but it’s been as late as today, in some years.

What popped out from assembling the Earnings Calendar was the number of hotels, miners, Retail Shopping REITs, shippers, and media, though in the latter category, Discovery and its many tickers, combined with Liberty, and its many publicly traded appendages, constitute an entire category of their own, scheduled to report Tuesday & Wednesday, respectively. I also noticed a few shippers on the calendar, along with some big names like T-Mobile, Applied Materials, Cisco, PepsiCo, along with competing beverage companies, Dr. Pepper Snapple, Heineken, and Molson Coors. Just pulling out some names, whose tickers are highlighted lead me to Rolls-Royce, Bunge & CF Industries, Denny’s & Wendy’s, along with Restaurant Brands International. Hotels include Wyndham, Choice Hotels, Hilton, Hyatt, and both Caesar’s & MGM. Friday, Fannie Mae is scheduled to report, though a decision on the fate of the GSE’s doesn’t appear to be a priority for the Trump administration.

New York Fashion week has kicked off, which will add gridlock to snow woes. Other big events include the Westminster Dog Show, through Wednesday though I insist to anyone planning on tuning in to the final judging that they rent "Best in Show," to view immediately after the top ribbon is draped around the winning dog. The two are so much more enjoyable together, than they are separately. Credit Suisse’s Annual Energy Summit in Vail, is always a favorite I-bank conference. The BIO CEO & Investor Conference, also starting Monday, is the nexus of a handful of other conferences built around it. Those will be hosted by SunTrust Robinson Humphrey, Roth Capital, Leerink, and more. Likewise, the RSA Conference, now a Dell event, starting Monday, is the basis for several "hosted meeting" events from I-banks, including IDC, Stephens, and Citi.

NASSCOM—Software & services Association India Leadership Forum, in Mumbai, India, starting Wednesday, as well as Outsourcing World, closer to home, in San Antonio Texas Saturday, are bound to have H1-B visas top of their mind. The tech industry can’t even imagine what outsourcing would look like without the mostly Indian tech workers that staff all the support positions outsourcing creates.

Goldman Sachs is hosting its annual Technology & Internet Conference, in San Francisco, starting Tuesday, though I’m skeptical about its impact, this year. Other major I-bank events include Bk of America Merrill Lynch’s 2017 Insurance Conference, in NY, starting Wednesday, as well as Leerink’s 6th Global Healthcare Conference, the same days, in the same city, while BB&T hosts its Annual Logistics & Transportation Conference, in Coral Gables FL, starting the same day.

Big healthcare medical society meetings includes DDI, or Digestive Disease Institute Week, and the associated sub-sections meeting concurrently, starting Tuesday, down here in Boca, NASS, from the North American Spine Society, in D.C., also starting Wednesday, and the AAAS, Association for the Advancement of Science, which has become more and more a biotech event, as the years have gone on. It starts Thursday. Friday, the TOTY, or Toy of the Year Awards open the NY Int’l Toy Fair, around which both Hasbro & Mattel will host analyst events, streamed live, to debut their upcoming back to school and holiday ’17 toys, more and more, dependent on the upcoming film calendar. Toy Fair doesn’t officially open until Saturday but with the TOTY’s on Friday, along with HAS & MAT’s events, the Toy world will overtake NY City, just as the fashion cogniscenti are exiting, assuming there are no additional snow events, like the one that caused cancellation of 3800 flights, last week.

Stocks got another tail wind thanks to Trump’s mere mention of tax reform to come in the weeks ahead. The reforms, of course, will be "phenomenal," as opposed to anything the Dems have ever done, which are all "disasters." That the Street is so willing to buy into his hyperbole, astounds. Anyone who does the math must realize the Government will have to ramp up its debt issuance, just as the biggest buyer—the Federal Reserve—is due to stop re-investing proceeds from maturing debt on its books. Of course, the thinking goes, the world will be more than willing to buy US debt, given the higher rates on offer here, compared to anywhere else in the Western world but I still don’t see how unwinding $4Trillion dollars of Fed holdings can meet up with greater issuance, even as rates continue to rise to unwind the extraordinary support the economy received in the throes of the "great recession." And while it’s true that stock usually rise early in a tightening cycle, there’s no saying when the multiples stocks will soon reach are mismatched with higher rates—or put another way, at what multiple will stocks stop rising, and at what rate will stocks stumble—perhaps in a ugly panic that’s clearly not built into current low levels of VIX? I don’t think that’s this week’s business but at the rate stocks are accelerating ever higher, it may not be that far away, either. Unlike her predecessors, Yellen may just take the punch bowl away, especially given her term as head of the Fed ends in about a year. It’s possible that puts stocks on a count down too few are thinking about, right now. .

ECONOMIC: (Highlights, only, below. Full
International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

February 06—10, 2017   STILL NO DOUBTS ABOUT PRESIDENT TRUMP?    Pres. Trump is proving the wild card that Wall Street is still ignoring. Sure, financials surged, Friday, on a strong Jan. Unemployment Report, whose details were not as good as the headline addition of 227K jobs in January. There was, to start, 39K job gains subtracted from the prior two months (Nov. revisions featured 40K fewer jobs added than announced but Dec. up by 1K), more evidence of stagnant wages, despite 17 states raising their minimum wage, on Jan. 1st, and U6 not making much progress, as part-time workers aren’t, either. There’ll be more on jobs, this week, with the Labor Market Conditions Index, on Monday, and JOLTS, Tuesday, which measures job turnover & people quitting, the latter a sign of confidence in the ability to obtain a different job.

Friday’s mixed job report followed Wednesday’s FOMC statement that revealed no surprises: The FOMC doesn’t see the economy much different than its been, except in measures of business & consumer confidence. Left unsaid was the confidence pinned to anticipation of what Trump says he’s going to do with taxes and regulations, rather than anything he’s done, so far. In the meantime, Trump is picking fights with allies, and defended Russia’s Putin after a reporter called him a murderer, Trump going on to say that the US isn’t innocent, either. Which court, do you think, is recipient of the first filing from someone whose family was collateral damage in a bombing in Iraq, Iran, or Afghanistan? What’s sad is that there’s really no one but Trump’s daughter or her husband to try to rein in Trump, his top advisor, Bannon, a probable wing nut on his own, and not much of a diplomat. Even if the Secret Service winds up taking away Trump’s ability to tweet at 3am, as they took away Obama’s Blackberry, in his early days in the White House, there’s really no way to stop Trump’s impulsive, instant responses to questions.

One other item on the Economic Calendar is, usually, worth noting—the Dec. Consumer Credit release, Tuesday afternoon, which is really an account of how much deeper into debt Americans dived, in December. However, even that report should lack punch, this time, given earnings reports already published by credit card issuers and banks that are conduits for student loans. The financial companies have already provided more detail than the monthly publication does. The Trade Deficit, out the same day, will surprise no one, and provide an excuse for Trump to pronounce the U.S. "A disaster," or exclaim "they’re killing us," perhaps both, yet another time. Can’t help but wonder what Japan’s Prime Minister will be thinking as his car approaches the White House for Friday’s meeting with Trump. Abe understands enough English to know what Trump is saying but, perhaps, will use the interpreter for cover to calm his anger before replying to any wild comment from the president.

The Earnings Calendar is long but lacks the headline reports that could take the markets down, or push them up. By Friday, I’d think, the UK’s NIESR (national statistics agency) GDP for Jan. would be more significant. As P.M. May advances towards triggering Article 50, with Parliament’s OK, now, the BoE has stopped thinking it will be as deeply negative for the UK as it did, originally but recent housing and consumption data suggest it still could. With regards to the tickers highlighted in this week’s Earnings Calendar, it’s all relative—the emboldened tickers should attract more attention than the rest, though some of them, clearly, wouldn’t, if scheduled for a different week. CVS, Humana and Wellcare Group stand out because of the approaching repeal of Obamacare, while media companies, major international oil companies, and food plus restaurants also caught my eye. By next week, retailers will start trickling out before their flood of reports, the rest of the month. This week, Michael Kors is a headliner, along with General Motors, Nissan & Toyota Motors. AGCO, ADM, Kellogg, Tyson & Pilgrim’s Pride are all highlighted, as is Sysco, which delivers a lot of food products to retailers. Throw in reports from Mondelez, Whole Foods Market, Coca-Cola, Buffalo Wild Wings, Panera Bread & YUM! Brands, along with the first ever report from recently separated Yum China, and there’ll be more information on consumers than just their debt, this week. In media, Gannett, Time Warner, Walt Disney, News Corp, & Viacom will cover the sector well.

The I-banks are seeping back onto the schedule, with Credit Suisse’s 18th Annual Financial Services Conference, starting Monday, CanaccordGenuity’s Rare Disease & Boipharma 1x1 Tuesday, and Cowen Group’s 38th Annual Aerospace/Defense & Industrials starting Wednesday. BMO Financial hosts Financial Services, also, Thursday, a few miles away from home, in Boca Raton. Personally, I imagine some would prefer to be a fly on the wall of HSBC’s Mexico CEO/CFO Roundtable, in Mexico City, starting Wednesday. Still others would rather take a front row seat at NY Fashion Week, starting Thursday, though attendance via live streams, on any computer, has been SOP, for most designers, for the past few years. What they added in the past 2 years was instant ordering—straight off the runway.

All in, it will be a busy week for news but the wild card—for the next four years—remains the very undiplomatic occupant of the White House. Sooner or later the Street has to realize that Trump is a loose canon, whose plan to reduce taxes & regulation comes with a lot of other baggage that could, seriously, hurt the economy. When that happens, stocks will not only stop their advance but could take a bad tumble, too. Even Friday’s big gains fail to impress—it was almost exclusively in the financials, which was strange because the FOMC statement didn’t put March on the table for the next rate hike, and that’s what’s been driving them higher, since the election. If it was Trump’s diss of Dodd-Frank that spurred animal spirits in the financials, then that’s not, necessarily, good news, either. SIFIs have spent a fortune staffing up for compliance with Dodd-Frank, and can’t be pleased to know it was all for naught, especially when some features of the law make their counter-parties stronger, so reduce risk. Is the President who campaigned on dismantling Wall Street going to hand them the keys to the kingdom, now, and disappoint the very base that elected him, some explicitly for the pain he’d inflict on Wall Street—as opposed to Clinton, who took hundreds of thousands in speaking fees from the Street, as he repeatedly brought up? Not to mention how many times Trump seems to change his mind. What if all his talk of dismantling Dodd-Frank is just bluster? What if Republicans finally revolt, and refuse to go along with Trump’s newly stated intent to undo Dodd-Frank? In at least one scenario I can imagine, Republicans start ring fencing Trump, and refuse to go along with his plan to defang Dodd-Frank, given their constituents blame Wall Street for the "great" recession.

ECONOMIC: (Highlights, only, below. Full
International Calendar is here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

January 30—February 03, 2017  EARNINGS, DATA & FOMC Oh Boy!    With China and most of the Orient, ex-Japan, closed for the week, it still won’t be a slow week. Data, a deluge of Earnings, and Central Bankers will assure no one misses China or Hong Kong, as Lunar Celebrations mean as little here, as Thanksgiving Day does, over there. Let’s start with the US Calendar because it’s chock a-block, with Dec. Personal Income/Spending, PCE & Savings Rate to start Monday, along with the Dec. Pending Home Sales Index, before the 2-day FOMC Meeting starts on Tuesday. Overnight, Monday, we’ll receive Japanese Data, the BoJ Meeting Statement and any Rate or QE changes, along with Eurozone 16Q4 GDP and the Dec. Unemployment Rate, along with Jan. CPI. , and European speakers that include EDB’s Draghi, along with EU Commission VP Dombrovskis, & ECB Board member Mersch, at the ECB/European Vcomission Joint Conference. At an "Innovation & Regulation in the World of Tomorrow" panel ECB’s Coeure, European Security Markets Authority leader Maijoor, & LSE CEO Rolet.are panelists.

Wednesday, automakers will release January Vehicle Sales, and ADP will update its Jan Private Sector Employment Report, before the EIA releases weekly Crude, Distillate & Gasoline stockpiles, and the FOMC Meeting statement is released, at 2pm eastern time. Wednesday, overnight, the BoE monetary policy committee will set rates, plus Bond & QE targets, and release its Inflation Report, the latter the subject of BoE Gov. Carney’s press conference that will occur, not long before markets open on Thursday. The nine Chain Stores that still report monthly sales will weigh in on Thursday morning, along with a few retailers that may feel compelled to report their preliminary quarterly numbers, as most retailers end their quarter at the end of January, then report earnings in February. The Bk of Japan will release Minutes of its Dec 19—20, 2016 Meeting, overnight Thursday, before Wall Street wakes up in anticipation of the January Unemployment Report, out Friday morning. The BLS will, also, release its benchmark revisions to the monthly Unemployment Reports for a full year. before the Fed’s Evans speaks on current economic conditions & monetary Policy, at the Prairie State College Economic Breakfast, in Olympia Fields IL.

Earnings start slowly on Monday, before reaching crescendo on Wednesday and Thursday. Let’s cut to the chase, Aetna, ExxonMobil, HCA, ManPower, Mastercard, Nasdaq, Ninetendo, Pfizer, Simon Property, Sprint, Thermo Fisher Scientific, UnderArmour, UPS, and Valero report Tuesday morning, while in the afternoon, Advanced Micro Devices, Apache, Apple, Arconic, Chubb, Deutsche Bank, Electronic Arts, and US Steel report. If Arconic doesn’t ring a bell, then you haven’t followed Alcoa’s split into 2 companies, and failed to notice it wasn’t first to report results, 2 weeks ago. There are more companies reporting Tuesday but, then, you can check the calendar yourself, and see which tickers are highlighted, based on what we think the media will talk most about, on any given day.

Wednesday morning could feel like a lull, with Anthem, Johnson Controls, Marathon Petroleum, Meritage Homes, Roche Holdings, and USG, among the reporters. In the afternnon, the names that caught our eye include Allstate, Avalon Bay Communities, Edwards LifeSciences, FaceBook, Metlife, Murphy USA, and NXP Semiconductors report. On Thursday morning, reports from Autoliv, Canadian media & telecom BCE, Cigna, CME, ConocoPhillips, Daimler, Deutsche Bank, Eaton, Estee Lauder, Group One Automotive, Kelly Services, M/I Homes, Ralph Lauren, Royal Dutch Shell, and Vodafone are just some of those expected. Thursday afternoon, the schedule is slimmer but includes Amazon, Amgen, Apartment Investment, Chipotle Mexican Grill, FireEye, Fortinet, Hanes Brands, The Hartford & Visa are expected to report. On Friday, AutoNation, Clorox, Hershey, Honda Motor, Madison Square Garden, Phillips 66, and Weyerhauser report, to end an active week that could see traders pulled this way and that.

The stock break-out I didn’t expect until the week after this week’s earnings releases, at the earliest, instead arrived last week, with the much talked about Dow 20K attained and held. A market that has been ahead of itself—and well ahead of earnings or legislative reforms—rushed ahead of fundamentals, again, to make new highs last week, ignoring the border wars Trump has been waging, the ban on immigrants from Muslim countries, over the weekend, creating chaos at airports nationwide, while at least 4 judges halted his ban. That didn’t take long, did it? Just 8 days in office and, already, the courts are blocking Trump’s most rash executive orders. While Paul Ryan pays lip service to being on the same page with the President, scuttlebutt has it they can’t stand each other, and I’d like to think many other Republican members of Congress are, privately, cringing in their seats. What Trump seems to want most of all is attention. His elevation to the leader of the free world doesn’t seem to be enough—he’s tweeting in every quiet moment to make sure no one forgets he’s in charge, and he’s going to kick Obama’s legacy out the door as fast as humanly possible. Living in the White House while wife Melania is in NY, one wonders how long it’s been since he’s slept in a bed alone.

A quick nod to the Events Calendar, again, mostly devoid of I-bank conferences, in deference to the heavy Earnings Calendar but plenty of industry events to offset. SPIE’s Photonics West, is already underway, as is the ASCO/ECCO Joint Cancer Congress, along with the 14th Review: Clinical Hematology & Oncology Congress. Starting Sunday, Hawaii Dermatology, itself an irony. Dermatologists want everyone out of the sun, nearly impossible in Hawaii, as it is, here, in Florida. A mere walk across a parking lot from grocery to car is a walk in the sun. ICSC (Shopping Centers) meeting in Whistler, British Columbia, with the Screen Actors Guild (SAG) Awards on Turner channels Sunday night.

Noble Financial hosts NobleCon, starting Monday, Described as an Annual Small Cap & Emerging Growth Investor Conference, small is a gross understatement. Stephens hosts a Bank Field Trip to Houston & Dallas, while the annual Health Benefits Conference & Expo will beheld in Clearwater, FL, even as Trump & his party’s determination to repeal Obamacare, meets up with the deadline to sign up, Tuesday. Also Monday, Enigma, for Emerging (Digital) Threats & Novel Attacks, just as companies like FireEye & Fortinet are scheduled to report earnings. Also meeting, starting the same day, Smart Data, Industrial Transportation League, AHR (for heating & airconditioning), Advanced Automotive & Stationary Battery, in Germany, and the Pet Industry.

Tuesday, ScotiaBank, which owns Howard Weil, starts a roadshow in Montreal, before moving to Toronto, then NY. DesignCon, one of the biggest chip & circuit board events of the year starts in Santa Clara, of course. Feed, Pork, and Pet Food are the subject of other Tuesday events, along with Energy Mexico, and 3D BioPrinting.

Come Wednesday, we’ll all hold are collective breath, waiting for the 2pm FOMC statement but no change in rates or the outlook for 3 rate hikes, this year, are expected. That doesn’t mean the FOMC statement has to be a snooze but, then, it probably won’t surprise too much. After briefly exceeding 3.0% in 16Q3, GDP was, again, back under 2.0% in the most recent update, last Friday, the first look at 16Q4. That’s the kind of slow growth that weighs against 3 rate hikes, this year, rather than supporting the Fed’s, dot.plot of most likely moves. And economists were well above where the initial read on GDP came in, just as retail sales, over the holidays, were not nearly as robust as assumed.

Other events scheduled for Wednesday include more animal-related events including Cattlemen’s Beef Association and Farming for the Future, in State College Pennsylvania. FIG Partners will host its 8th Annual West Coast CEO Forum but, again, it’s healthcare that dominates: There’s the 19th Int’l Conference on Dialysis: Advances in Kidney Disease (Las Vegas), SCMR Scientific Sessions: Cardiovascular Magnetic Resonance (D.C.), and Pri-Med South (Ft Lauderdale), and the European Society of Sexual Medicine (Nice, France). TD Ameritrade, on Wednesday, starts its LINC Conference, with advisors, in San Diego. By Saturday, a new crop of healthcare-related events crank open their doors, including Home Care 100 (Amelia Island FL), SLAS for Laboratory Automation & Screening (D.C.), as well as ISET, International Endovascular Symposium on Clinical Interventional Cardiology, even as School Mental Health begins this Friday, subtitled "Treating Students K-12 which, I hear, should really be ‘treating teachers of K-12," given the pressure teachers are under as more states eliminate tenure, and demand even more paperwork and standardized teaching, critical thinking falling by the wayside, as memorization replaces deductive reasoning.

At some point, Wall Street is going to take the "border tax" and scrapping of trade deals as negative for businesses that have become multi-national in the past 30 years. Why that has not, yet, become a sticking point for the Street puzzles me. How can the same group that believes in tax relief coming down the pike, despite no bill to launch that change, not see how serious Trump is about taxing imported parts and goods? Trump and his cadre believes that slightly higher prices will result for consumers but that will be offset by economic growth that will bring about higher wages. Ya think? As if retailers didn’t have enough pressuring them, now, with mall traffic disappearing, higher prices will only add to their woes and depress margins more, as consumers turn their noses up at anything that isn’t at least 40% off. The first 100 days? I would think, at the rate of outrage he’s doling out, Trump could blow the honeymoon that much faster than most new Presidents, maybe in 30 days?

ECONOMIC: (Highlights, below. The Full International Econonic Calendar is here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

January 23—27, 2017 
ALL ABOUT EARNINGS FOR THE NEXT TWO WEEKS    US Central bankers are taking some time off, while European Central Bank members are everywhere. And while it appears the next two weeks could be all about Earnings Season in the US, we may have to eat our words if the new President & Congress surprise the Street by getting something done this soon.

Data includes Dec Existing Home Sales Tuesday, FHFA Nov House Price Index Wednesday, Thursday the US International Trade Deficit, and Dec New Home Sales, all before Friday’s 16Q4 Advance GDP, and Dec Durable Goods Orders & Shipments. The Economic Calendar would be more important if it weren’t for Q4 Earnings and the forward looking nature of markets, that make pre-Trump data secondary, now.

By Friday, when UK Prime Minister May meets with Trump, we’ll be losing China for nearly a week, as the Lunar New Year, next Saturday, leads so a near East Asian cessation of nearly all other activities. And while both the BoE’s Carney (Tuesday), & ECB’s Draghi (tonight, Sunday) are scheduled speakers, there doesn’t appear to be any reason to expect either of them to comment on rates, given the nature of the events they’re appearing at.

Because of the heavy Earnings Calendar, I-bank Conferences on all but on hiatus, for this week and next. CIBC is an exception, hosting its Whistler Conference, starting Wednesday, even as Morningstar announces the US Fund Managers of the year 2016, that day, and BB&T hosts Senior Living, Housing & Charter School Investor Symposium, also the same day. NADA 100, the Auto Dealers will meet starting Thursday, which brings about the concurrent JD Power Automotive Summit, and "Automotive News" Retail Forum, all in New Orleans. Otherwise, the week’s events are heavily dominated by more healthcare related events, including Cardio-Thoracic Surgeons, Rheumatology, Critical Care, Cancer Research Nuclear Medicine and Molecular Imaging, Int’l Headache Academy, Pi3K Pahways in Immunology, Growth Disorders & Cancer, Diabetes, Obesity & Adipose Tissue Biology, Biobetters & NextGen Biologics, and all those are already underway as I write, on Sunday. Monday, Precision Medicine World Conference starts in California, while Wednesday, the Yankee Dental Congress starts in Boston. Then Thursday AAO Cataract Surgery, European Generic Ass’n, British Obesity & Metaboloic Surgery, and by next Friday, a 14th Review Clincial Hematology & Oncology Congress, the ASCO/ECCO Joint Cancer Congress (in Amsterdam), then Saturday, Highlights from ASH (Hematology), AGA Advances in Gastroenterology & Hepatology, a tremendous number of events for a single week.

Meanwhile, the Press will be more impressed with Men’s Haute Couture Week, wrapping up, and Women’s just getting underway in Paris, when it’s not following Trump’s every breadth. His war with the press has only intensified, his advisor, Maryanne Conway disputing the fact that Trump’s inauguration drew fewer on-site spectators than Obama's. She calls it "Alternate Facts," which is not what any parent wants to teach their kids. Had she said, it was cold and rainy, that would have been one thing but to discuss Trump’s "bigger crowds" in her "alternate facts," does nothing but assure that fact-checkers will have continued employment for the next 4 years, at least.

Two other events worth pointing out are IREI’s VIP—Vision, Insights & Perspective Americas (Tuesday), and before that, Tour d’Alis, the Americas Lodging Investment Summit, the latter in Los Angeles, the former in Carlsbad CA, so at least on the same coast. For all the touts of REITs as they gained their own, 11th, S&P index, in September, the sector has struggled, a bit, as rates have rocketed higher. Barron’s, this week, thinks some REITs deserve investment this week, in the print issue. RILA, retail leadership event points out one reason some mall REITs have not performed: Retailers are closing stores to shrink their base to the most profitable locations. And sports are somewhat prominent, as the Australian Open enters its 2nd & final week, when the PGA Me3rchandise Show & Demo Day start in Orlando, Wednesday, even as SIA Snow Sports & Demo, take place in Denver, both starting Wednesday. Surf Expo starts Thursday, while Imprinted Sportswear, which meshes well with all the sports expos, is already underway.

Which brings us to the Earnings Calendar, from which most of the regional and state banks have been removed, as is our way of doing things, because we cover, only, the big money center banks and biggest regionals, offering foreign banks with ADRs a bigger opportunity to land on the Calendar than any smaller US ones. Or even Bigger US ones. The Earnings Calendar is dominated by transportation, including Rails, Boeing, & Airlines, as well as defense companies, a few oil related names, and major tech companies, especially Alibaba, Alphabet (still better known as Google), Intel, eBay, Lam Research, Qualcomm, and PayPal. For the Dow Jones Industrials, 3M’s report, Tuesday morning, could have the biggest influence. But pharmaceutical companies are well represented, also, along with McDonald’s, Travelers, builders D R Horton & Pulte Homes, both Fiat Chrysler & Ford, before American Airlines, Chevron & Colgate-Palmolive join General Dynamics, Honeywell, and NextEra wrap up the week of Friday, with UBS.

Those tickers emboldened on the Earnings Calendar are totally subjective. Three other analysts would come up with different tickers to highlight, while another dozen would come up with still others. But I think we can all agree some, like Alphabet, Microsof,t & Starbucks on Thursday afternoon, simultaneous with Caterpillar, Celgene, Comcast, Dow Chemical, Mead Johnson, Raytheon, Royal Caribbean Cruiselines, Sherwin-Williams, Southwest Airlines, Stanley Works, ST Microelectronics, and Whirlpool would make for a big afternoon, even if there weren’t dozens of other companies expected to report after hours the same day. The Martin Luther King Jr holiday, last week, seemed to push out some earnings reports to this week but the deluge is yet to come next week, even as the Street has one eye on Washington, awaiting something big from either Congress or the White House.

All in, the markets have been consolidating the big post-election rally, and should be trapped not very far away for another 2 weeks, at least. Generally, stocks do little to nothing during the first 3 weeks of earnings season, then celebrate between the 4th & 5th week, as reported earnings were neither as bad as feared, and the outlooks prove less negative than worries had it. The problem, right now, is the strength of the dollar, that has to trip up multinationals’ outlooks, a little, even as no company can, yet, price in a lower tax rate. About the only thing we can say for sure, right now, is that it looks like estimates have come down far enough for few companies to disappoint. But it doesn’t appear, either, than the outlooks are going to be strong enough for estimates for 2017 to rise enough to spark a new leg of the rally, yet. And don’t overlook the fact that end of month will play a roll in trading, as well, as the week wears on.

ECONOMIC: (Highlights, only, below. Full
International Calendar here)   

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

January 16—20, 2017  ANOTHER WEEK OF FINANCIALS DOMINATING EARNINGS     There are Fed speakers out and about, including NY Fed’s William Dudley at the National Retail Federation (NRF) Big Show, at the Javits Center, Lael Brainard at Brookings, Fed’s Williams at the Sacramento Business Review Economic Forecast meeting, FOMC Chief Yellen at the Commonwealth Club of San Francisco, in addition to a Town Hall meeting with Educators, the 2nd in a series, and late Thursday, delivers a speech, "The Economic Outlook and the Conduct of Monetary Policy," at the Stanford insgtitute for Economic Policy research, at Stanford University. The Fed will release its New Beige Book, Wednesday. It keeps the region-specific input but seeks to raise the standardization of anecdotal data across districts, especially in areas of Employment & Wages, Prices & Overall Activity. Dec CPI Thursday, along with NAHB’s Jan Housing Market Index and Dec. Industrial Production/Capacity Utilization.

More important, perhaps, will be UK Prime Minister’s first major speech on Brexit plans, Tuesday. Since the reaction to Brexit was expected to be cataclysmic for the UK, setting off the BoE rate cut in July, but the economy has hummed along quite nicely, outside house sales in London. The abstract idea of Brexit, with May’s speech, may be moving towards to reality, with all the implications once feared. She leaves for the World Economic Forum, after her UK speech. Likewise, the Bank of Canada is hosting a monetary policy meeting, Wednesday, which will be followed by BoC Chief Poloz’s press conference, to be followed by the ECB’s MPC meeting overnight Thursday, with Draghi’s press conference just 90 minutes before the US markets open, later that day.

"Too Big To Fail" Neel Kashkari is speaking on Wednesday but not on the banks, for a change up. Fed’s Harker will discuss the Economic Outlook Friday, at the New Jersey Bankers Ass’n 6th Annual New Jersey Economic Leadership Forum, all the US central bankers hosting Q&A’s with media present, except Yellen’s Town Hall with educators. Therefore, there’s opportunity for wild cards from any of them. Of course, truth be known, Trump is being inaugurated as the 45th President of the United States, Friday morning, the shock of his election win still a sore spot for many voters, and Congresspeople, as well. At least some us await the Secret Service either shutting down or filtering his tweets, if he can’t make that decision, himself. Surely, even his most ardent supporters must wish, occasionally, that he’ll start acting more "presidential" in the future. Then, again, OPEC & non-OPEC Crude producers’ monitors meet for the 1st time, next Saturday, with media talk this past weekend filled with rumors that the Saudi’s are ready to give up the embargo, either in May, when it’s set to end, or sooner.

Of course, rich folk who aren’t at Trump’s Inauguration will probably be found still hanging around Davos-Klosers, for the last day of the World Economic Forum. For those who want more on the WEF, see the
Agenda. As you’ve probably heard, China’s Pres. Xi Jinping, is speaking, a first for a Chinese Leader. The Pre-Meeting Press Conferences have already taken place, by the time we’ve posted. US VP Joe Biden spoke on MLK Jr day, also pre-conference. For a look at just the speakers, you’ll be taken to a page of photographs with just each name underneath. Each photo has to be opened, individually, to get bio on a speaker. I.e. Stephen J. Adler, the Pres. & Editor-in-Chief of Thomson Reuters. A few you’ll know (or should) almost immediately, like GM’s CEO Mary Barra, Dow Jones/WSJ’s Gerard Baker, Henry Blodget, Sergey Brin (Google/ Alphabet), Lonnie Bunch (founding Dir. of Smithsonian’s Nat’l Museum of African American History & Culture), Eric Canter, cartoonist Patrick Chappatte, Erik Brynjolfsson (Dir. Of MIT Inititiative on the Digital Economy/Prof. MIT Sloan School), David Cote (HON), Ray Dalio, Matt Damon, Angus Deaton (2015 Nobel Laureate in economics), CNBC’s Sara Eisen, JPM’s Asset Mngmnt CEO Mary Callahan Erdoes, former CEO/Pres of Saudi Aramco Khalid Al-Falih, BLK’s Laurence Fink, Pulitzer Prize winning journalist Thomas Friedman, Bill Gates III, Carolos Ghosn, TIME Editor-in-Chief Nancy Gibbs, National Geographic Magazine & News editor-in-chief Susan Goldberg, UK Chancellor of the Exchequer Philip Hammond, Mio founder Jake Horowitz, Arianna Huffington, QCOM’s Paul E Jacobs, Ant Financial Services Group’s CEO Eric Jing, former Swiss Nat’l Bank head Thomas J Jordan, Saudi Arabian Minister of Foreign Affairs Adel bin Ahmed Al jubeir, Bloomberg’s Tom Keene, US Sec’y of State John F. Kerry, IMF Dir. Christine Lagarde, Publicis Groupe SA’s Maruice Levy, DOW CEO/Pres/CB Andrew N Liveris, BABA’s Jack Ma, Pres. Int’l Cmte of the Red cross Peter Maurer, UK PM Theresa May, SAP’s Bill McDermott, WMT CEO Doug McMillon, songstress Shakira, BAC’s Brian Moynihan, Exec Dir of Greenpeace Int’l Jennifer Morgan, TIME’s Alan Murray, Malaysia’s Minster of Int’l Trade & Industry Mustapa Mohamed, MSFT’s Satya Nadella, Hitachi Exec CB Hiroaki Nakanishi, Saudi Aramco Pres/CEO Amin Nasser, Centene Corp CEO/CB Michael F. Neidorff, CNBC Africa Editor-in-Chief Bronwyn Nielsen, BLK Vice Chair Barbara Novick, and that’s just scratching the surface through the "n’s." I haven’t even gotten to Carmen M Reinhart, Chuck Robbins, Kenneth Rogoff, Ginni Rometty, Nouriel Roubini, David M .Rubenstein, Netherlands PM Mark Rutte, Sheryl Sandberg, Anthony Scramucci, Wolfgang Schauble, Sir Martin Sorrell, BCS’ Jes Staley, Joseph E Stiglitz, Laura D’Andrea Tyson, Axel a Weber, actor Forest Whitaker, Meg Whitman, or so many others, too many others to do the list justice.

Cambridge House CanTech Conference features a keynote by Edward Snowden, on the 18th. His still a wanted man in the US, for stealing records from the NSA, so it strikes me as quite brazen for Canadian Cambridge House to invite him to keynote. I tried to identify when he was invited to speak, to see if it was an anti-American ploy in reaction to Trump’s desire to tear up NAFTA—the North American Free Trade Agreement that allows Mexican & Canadian goods to flow freely into and through the US on their way elsewhere in North America. Then, again, perhaps it was prescient that Snowden took up residence in Moscow. Trump seems determined to befriend Putin. .

The Earnings Calendar is filled with financials, again, most notably Morgan Stanley, Goldman Sachs, Northern Trust, TD Ameritrade, US Bank, Sallie Mae, Bk of New York Mellon, BB&T, KeyCorp, Citizens Financial Group, SunTrust & Synchrony Financial, along with many smaller and more regional banks we don’t cover. Also Reporting, United Health, rail CSX, Canadian Pacific Railroad, Kinder Morgan, Netflix, Check Point Systems, PPG, Union Pacific rail, American Express, IBM, GE, Kansas City Southern (rail), and Schlumberger. All in, a light calendar with a powerful punch, especially for those dreaming of Dow 20K.

The Event calendar promises a lighter investment bank schedule, in deference to the Earnings season cranking up. Healthcare related meetings, mostly the medical society persuasion, includes State of the Brain, underway in Keystone CO, Winter Clinical Dermatology, also underway but in Hawaii, which is ironic if you think of how many times dermatologists council to stay out of the sun, Oncology Update: Advances & Controversies, Plant & Animal Genome, and that’s just the ones still meeting Sunday. Retina starts Monday, when Jefferies will host a Dental Summit. ASCO’s Gastrointestinal Cancers Symposium starts Thursday, along with Society of Cancer Research Nuclear Medicine & Molecular Imaging Mid-Winter Meeting, and NADL for Dental Labs Vision 21, along with Pi3K Pathways in Immunology, Growth Disorders & Cancer, the Cardiovascular Research Foundation CHIP—Complex High-Risk Patients and the International Headache Academy, the last 2 starting Friday, before next Saturday’s Society of Cardio-Thoracic Surgeons Annual Meeting, concurrent with AATS Tech-Con, plus SCCM for Critical Care & the Winter Rheumatology Symposium.

In addition to the usual abundance of medical society meetings, energy is notable, including Seaport Securities (formerly Global Hunter Securities) SoCal Energy 1x1, Argus Media’s Americas Crude Summit, both starting Tuesday, Peters & Co Winter Energy Conference (Alberta Canada), RBC Capital Markets’ Private Company Energy Conference, Of course, the biggest conference, outside Davos Switzerland, may be the NRF’s Big Show in NY, though NATPE for TV Programming Execs occurs on the tail end of the TV Critics Winter Tour, while A3 Robotics Industry Business Forum, even as both Raymond James & TD Securities host Metals & Mining events, respectively, both starting Wednesday. There are a few AirFinance events in Dublin Ireland, with different sponsors but purposely held concurrently and/or sequentially. For those worried about the message from last week’s Dec. Retail Sales & retailers’ updates, they’re not done yet: Tiffany releases a holiday sales update on Tuesday, while Ascena Retail Group hosts an Investor Day in NY. I used to call Ascena one of the billion dollar retailers that no one follows but, now, I kind of which it was the billion dollar retailer I no longer have to follow. Grown through acquisitions, it’s last acquisition, of Ann Inc (Ann Taylor & LOFT by Ann Taylor) seems like the worst timed acquisition since ExxonMobil bought XTO, a natural gas company. Worse, a year on after the deal, Ann Taylor’s offerings look worse than ever, the mustard chosen for what we retailers used to call Cruise (late Jan into Feb), just horrific. I bought my mom a few cardigans Saturday, reduced by 50% and more, then 60% off the lowest price marked, taking home supposedly $176 worth of sweaters, at retail, for $40 altogether. One even had a frill alongside the button placket, which got mom’s hoped for response: "fancy." The mall, though, soft, an art festival in the parking lot surely just one of the distractions that kept consumers out of stores, temps near 76, with sun and a nice breeze, plus rare light humidity, surely another.

Then, again, why go into a store if you’re had an experience like I did at Best Buy, selling me an $8.50 cable for $42, and it wasn’t even the correct cable? In fact, instead, they tried to sell me a $199 box, when all I needed was a Display Port to DVI cable, obtained from CableWarehouse.com, for $8.47 plus $3.29 for mailing. Both the Geek Squad member and chief tech in computers ignoring the fact that I stated I’d just bought a new laptop, with Win10 Pro, never asking if it has a display port (they all do now, with Win10 Pro). I didn’t intend to go on line for the cable but didn’t, either, expect the Geek Squad to try and sell me something for $199 I knew I didn’t need, and for 4x what I could have paid for it online. Without the Geek Squad knowing anything, there’s little to no reason to enter a Best Buy ever again.

So, unless the Beige Book is a lot more uniformly bullish than the district by district flip flops between descriptions of districts as better or worse, the consolidation of the post-election rally should continue. In fact, historically, stocks mark time or pull back a bit, during the first few weeks of earnings season, before celebrating, in February, the earnings releases that weren’t as bad as feared. What may disappoint is outlooks, because it’s really hard to know what the future holds, with Trump making some truly outrageous promises of corporate & middle class tax cuts, as well as medical insurance for everyone, to replace Obamacare, but also boosting the dollar along with stocks, while threatening a border tax on imported parts and goods as big as vehicles, that will crush most retailers. In fact, one wonders how Gildan made the decision to pay $88m for American Apparel’s brand (up from the $66m stalking horse bid) but abandon its factories, when the US is such a big market for its tees and fleece, and American Apparel manufactured in California. Granted, Gildan is a Canadian company but given the importance of US sales, I wondered why Trump wasn’t all over the company, after the bankruptcy judge approved GIL’s bid and the notice to employees that they’re losing their jobs, except for 300 workers in one of AA’s factories which was bought by Broncs Inc.

I usually say "fasten your seatbelts" in advance of Earnings Season but this year, instead, you need to buckle up and wear a neck brace in advance of four years of Trump heckling CEOs, and telling the world how successful and rich he is. Meantime, expect Dow 20K to remain elusive unless IBM has done the remarkable—and actually grown revenues for the first Quarter in years.

ECONOMIC: (Highlights, only, below. Full
International Economic Calendar here)

© Sandi Lynne 2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence

January 09—13, 2017   THE RUBBER FINALLY HITS THE ROAD  The Economic Calendar is filled with Fed speakers, who it appears, are in synch either agreeing that the dot.plot’s 3 projected rate hikes for this year sounds about right, or is possible. Like everyone else, the Fed is waiting to see which of Trump’s plans get put into law. Big Data, though, waits for Friday, with Dec PPI & Retail Sales are announced. As if there wasn’t, already, some difficulty getting the market pace back on plan, this week is the lead up to yet, another, 3-day weekend, as Martin Luther King Jr’s birthday will be celebrated on the 16th.

Markets will have much more than a 3-day weekend on its mind, by Friday. Early Thursday morning, prior to US Markets opening, the ECB will release minutes of its last meeting, while the BoE will release its meeting statement, prior to Gov. Carney’s press conference. Then, Friday, markets are blessed with earnings releases from Bk of America, BlackRock, JPMorgan, PNC Financial, & Wells Fargo. While the money center banks had good things to say about equity & other trading, at a Dec. Financials Conference, the surge in US rates is a mixed blessing for banks, even as Wells Fargo will be weighed down by the upshot of its phony account scandal—fines paid, as well as business lost since the settlement with Justice was announced. For the rest, trading has picked up but there will, surely, be negative adjustments to loans on their books, relative to current rates, plus pressure from the debt they issued, much of it with floating rates. Yet, if there’s any group I’d like to see kick off earnings, this Quarter it’s banks, for sure, since they’ve seen the most instantaneous repercussions to the revival of animal spirits in stock markets. From Infosys, Friday, we should also hear comments on how an outsource company based in India plans on dealing with Trump’s move it to America tactics, even as there is an expected tightening of the visa its workers need to come stateside

The Events Calendar promises a events so big that investment banks are hosting events at them, to take advantage of the convenience of so many industry CEO’s in one place. Start, Monday, with JPMorgan’s renowned Healthcare Conference, to which Leerink & EBD Group tie their fortunes. Also Monday, the ICR Conference—formerly ICRxChange—is so big, Citi & Stephens host parallel meetings during the event, which includes presentations by several dozen retailers, several dozen restaurants, and some apparel manufacturers. Given last week’s retail warnings, close-ups are just what the analysts want. And let’s not forget that disappointing holiday sales is the set up for estimates lowered so much that by February, when retailers report their results, they’re rarely as bad as worst fears. How is that possible, you might ask? Take Best Buy, which no longer announces Holiday Sales, in deference to how important January is to its business, the company announced with its Dec. earnings release. (Signet, owner of Zales & Kay Jewelers will provide a holiday sales update, this week, on Wednesday. Tiffany won’t get around to its holiday sales update until the 17th.) I don’t know what BBY is expecting out of January but the store was dead, today (Sunday), with only one register open, and yet, they made me snake through a gauntlet of hanging merchandise and ropes, to get my small purchase paid for. And the mall was quiet, over the weekend, despite storms in the morning, Saturday, and unusually cold weather, for here, on Sunday, even as parts of the East Coast was snowed in. But what seems to satisfy analysts in Feb. when Q4 earnings are released, is retailers who managed to clear out winter inventory, to start the spring clean. If they can’t get earnings, then a fresh start for the new quarter will suffice, more store closures a sure winning strategy, too.

Monday, The Commercial Real Estate Finance Council Conference (CREFC), meets in Miami, which, also, brought about UBS’s reception, and other, quieter events from Citi & Bk of America Merrill Lynch. UBS’ MLP conference may not be as impactful as JPM’s Healthcare or ICR but surely of interest, given the renewed interest in energy, after a monster run, last year, from the February ’16 lows. Energy, however, is a theme that runs through the week, with TD Securities hosting Global Energy in London, Monday, Seaport Global’s SoCal Energy 1x1, US Capital Advisors E&P Corporate Access Day in Houston, Thursday, when Platts hosts its 15th Annual natural Gas Storage Outlook, in Houston, also, and Evercore ISI hosts Utility CEO Retreat, even as the Street will await EIA’s Wednesday crude status release, and Baker-Hughes’ Rig Count on Friday. Just as crude prices are pressuring gasoline higher, many drivers encountered even higher prices at the pump, thanks to higher state gasoline sales taxes. Pity the homeowners in the Northeast who still heat their homes with oil, instead of natural gas, though the latter has put up quite a run, itself, in the past year.

Tuesday, Deutsche Bank hosts its Global Auto Industry Conference, coincident with NAIAS, better known as the Detroit International Auto Show. IHS, Automotive News, and other events are planned around the main event, though IHS is not until Wednesday. The National Association of Home Builders, NAHB, openings the International Builders Show, Tuesday, around which many other shows pivot, including Kitchen/Bath Industry, Flooring, and man other specialty sub-shows.

Fresh off another boring Golden Globes Awards show, the TV Critics Winter Press Tour gets to the bigger names, this week, Disney’s ABC on Tuesday, when the disappointing opening of
"Rogue One: A Star Wars Story" in China, the last country to be able to see the monstrously popular film. Lions Gate Entertainment (LGF.A) hosts an Investor Day, at Starz offices, in Englewood Colorado, Tuesday, while Fox hosts the critics winter tour Wednesday, FX Thursday.

And if all this weren’t enough, there’s data out of China this week, including Dec. Foreign Direct Investment, out before markets open Monday, Dec CPI & PPI, either overnight Monday or Tuesday, plus China’s Trade Balance overnight into Thursday or Friday,, in the U.S.

But then, as I mentioned, Friday, despite all the banks reporting, could be a short day for markets--not because any US market is closing early, none are but because it’s attached to another 3 day weekend, and the earnings reports expected will all be out before the market opens. Some are predicting a pullback after Trump’s inauguration but, really, jump ahead to the earnings reports expected that week, and the inauguration just happens to fall in one of the biggest weeks for earnings of the quarter—despite the 4-day week. Watch, also, what gold has been doing, suddenly hot again, perhaps foretelling inflation catching up after years in hiding. Markets can add to recent gains into the bank earnings, Friday but after that, a dose of reality is bound to hit. If it doesn’t come from earnings, it could from a Republican Congress so hellbent on "sticking it to Obama," it took the President Elect to point out how poorly defanging the House Ethics watchdog would be perceived. Then, of course, keep an eye on the Senate confirmation hearings, because the coming President promised to drain the swamp and, instead, has added more of the same, with his appointees. Just another reason reality could soon hit home, if another tweet doesn’t do it. By week’s end, it might be wise to protect the downside.

ECONOMIC: (Highlights, only, below.
Full International Economic Calendar here)

© 2017 Sandi Lynne Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should be just one factor in more complete due diligence.

January 02—06, 2017   MORE CONSOLIDATION WHILE THE DATA STREAMS OUT  The week may consist of only 4 business days but it will be filled with more than a week’s worth of events. Tuesday, the US Treasury Auctions $127B in various short term maturities, then sits out the rest of the week. That doesn’t happen often, if at all, as a rule. Friday brings the December Unemployment Report which could be upset by snow storms that might have closed some state Unemployment Offices, even as the reporting week led into Christmas week, a time when people put off applying until the New Year. As with any first week of the month, there’s, also, Wednesday’s Dec. US Motor Vehicle Sales, Thursday’s Chain Stores Sales & Challenger Job Cut announcement, and the EIA weekly Petroleum Stats, delayed by Monday’s Holiday. Friday’s also the day for the AEA/NABE Joint Annual Meeting sessions that includes some US Regional Fed Reserve presidents. It’s worth mentioning that only nine chain retailers still report monthly sales but more than that will report Holiday Sales, over the next 2 weeks. Those are variously defined as Black Friday through New Year’s Eve, or the week of Black Friday through New Year’s Eve, depending on the company. On, yeah! If the Electoral College wasn’t enough to convince Americans that the Tweeter in Chief is about to become the next US President, then Congress will convene a joint session Friday to affirm that vote. Minutes of the FOMC December meeting should have no impact.

The EVENT Calendar is a handful of truly large events, even though some are organized by industry, rather than I-banks. CES is a case in point, and starts on the 5th. CES Unveiled previews the Consumer Electronics Show for media & industry analysts from 150 countries. Among the early press conferences, after Fiat Chrysler kicks it off, includes the launch of "Honor" brand smartphones, Qualcomm product launches (by invitation only), Tech Trends to Watch, Exploring the Global Tech Industry, and more. From the 3rd, until the doors open on the 5th, CES will be a massive series of press conferences. Pre-CES day #2 of press conferences from LG Electronics, Luraco Tech (Massage Chairs), Monster music Products, Intelligent Transportation Sysrems, Bing TV-Internet TV, Media & The Hollywood Connection, AI & Audience Intelligence, Analytics & Ads, Insider View of Mobility, Trends to Watch, Panasonic News conference, Ultra D "Glasses-free 3D," Exploring Mobility choices, Home Entertainment Landscape, Multi-Screen Strategies for InternetTV-Tech & Content, Fiber Broadband, Connected Health, VR-AR Think Tank, Hisense News Conference, Toyota News Conference, Pokemon GO—the Phenomenon of AR Gets Real, WAZE Exec 1-1, Google Shopping=High Quality Content Counts, Casio America News Conference, Narrowing the distance between Silicon Valley & Detroit, and more.

The most unexpected press event @CES is, probably, AIG Presents, to "announce the findings of its latest Internet of Things Study, which looks at the sharing economy and building digital trust to facilitate the data sharing necessary to drive it," at 3:30pm pac, on the 4th.

AEA: The American Economic Ass’n Annual Meeting (Chicago on the 6th—8th) is jointly held with 56 other organizations, the biggest one of which is NABE. It’s usually a newsworthy event though, this year, there are fewer heads of central banks than in many past years. As of my last check, the most high profile of the session chairs is Olivier Blanchard, now at the Peterson institute. Altogether, so many related disciplines (or feeder universities) attend and host meetings at this, many holding, exclusively, receptions, as does the Harvard University Dept of Economics & its business school, along with other heavyweight universities and business schools, as well as the ECB & the Nat’l Central Banks of the Eurosystem. With World Bank keynotes, followed by a session on Ag & Applied Economics, from the USDA, see the Economic Calendar for who’s speaking which day.

The other major industry event is NAIAS North American International Auto Show, aka the Detroit Auto Show, runs through the 22nd, but it’s the press conferences and media events that take place the 1st 2 days, before it opens to the public, that make all the news. More and more, the overlap between Detroit & CES has become apparent, with Fiat Chrysler leading off the CES pre-even keynotes, with many other automakers vying for technological cred, and autonomous vehicles. The I-Banks will be crawling all over CES with clients, even as tech firms will be prowling NAIAS. Citi, taking advantage of the presence of tech firms in Vegas, that firm hosts Global Internet, Media & Telecommunications, starting Tuesday. Wolfe Research is hosting Refiners, in Boston, with ALJ, DK, HFC, MPC, PARR PBF, PSX, WNR, and VLO.

Thursday, Goldman Sachs hosts Healthcare CEOs Unscripted: A view from the top, in Boston. Goldman’s also in Orlando for Global Energy. TV Critics start their Winter Press Tour, hosted by DirecTV, now an AT&T (T) division. Finally, on Friday, the American Farm Bureau Federation kicks off its Annual meeting, in Phoenix, though some of the USDA will be speaking at AEA/NABE.

Let’s acknowledge the probability of the appearance of the sellers, who held off executing exits last year, in anticipation of a, possibly, lower tax rate in 2017, under Trump. The first couple of days of the year are not often off to the races. Instead, a couple of days of selling that finally reverses on the 5th or 6th would be more typical. But the data will count. Until now, the post-Election rally was all about what a Republican White House & Congress could do, with a tax cutting President in office. Back to business after an extra day off, the data has to support the growth assumptions being made, until now. Then, the experts have gotten remarkably bullish about holiday sales, predicting an increase of 4.9%. The problem with that theory is the number of stores that went to 50%, 60%, & 70% off before Christmas, leaving nothing but margin crushing promotions to bring customers in the door, who were, then, a hard sale. If there wasn’t an extra 30% off merchandise already half off, no sales took place. 50% of 60% off merchandise already half price were commonplace. We all know a number of retailers started building into "original" retail prices the first 20% off but 50% or 60% off still eliminates profits—and, so it’s said, suppresses top line sales and, therefore, growth. The consolidation that began the last year of last year should continue in the early days of this year, but could end by week’s end. Then again, Congress shows up on Wednesday, and if the Republican leadership submits any business favorable bill for approval and mark up, thta would end the consolidation, sooner.

ECONOMIC: (Highlights, only, below. Full
International Economic Calendar here)  EXCERPTS OF PRIOR, 2016 OUTLOOKS HERE

© Sandi Lynne 2016—2017 Nothing contained in this commentary should be construed as a recommendation to buy or sell any security. The opinions expressed are the author’s, alone, and should just one factor in more complete due diligence.
    

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