Highlights

Wall Street Breakfast

Author: bmotrader   |   Latest post: Mon, 3 Aug 2020, 9:54 AM

 

Wall Street Breakfast: Negotiations Begin Over Next Coronavirus Relief Package

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Republicans have unveiled major parts of their coronavirus relief plan with just days to go before expanded federal jobless benefits are set to expire. Highlights: The $600 weekly federal unemployment supplement would be cut to $200 a week through September, when the payment will then combine with state benefits to replace 70% of previous wages. It also includes stimulus checks, $105B to help schools reopen in the fall and more PPP loans, among other provisions. The bill is the first step toward negotiating a compromise plan with Democrats, though Nancy Pelosi called it a "pathetic" piecemeal approach. "Having said that, we are going to see if we can find some common ground," she added. "But we are not there yet."

Big earnings week

"You need to understand that this week is about one thing and one thing only: It's about earnings. First time it's been like that in a while," CNBC's Jim Cramer declared, with Q2 results set to pour in. Today investors will hear how McDonald's (NYSE:MCD), Pfizer (NYSE:PFE), 3M (NYSE:MMM), Raytheon (NYSE:RTX), Starbucks (NASDAQ:SBUX) and AMD (NASDAQ:AMD) fared during the coronavirus pandemic and their expectations for the future. U.S. stock index futures are 0.3% lower ahead of the big earnings announcements, which will include Amazon (NASDAQ:AMZN), Apple (NASDAQ:AAPL) and Alphabet (GOOG, GOOGL) in the coming days.

Precious metals rally loses some steam

Spot gold fell more than 1% overnight to $1,920/oz, while silver tumbled 4.5% to $23.62/oz, as the FOMC gathers today for a meeting that may provide more direction for traders. While prices waver, most market watchers are still predicting more gains ahead for the precious metals. "The message from the Fed meeting is expected to be dovish, reiterating the need for more fiscal measures, which is likely to be supportive of gold," said Nicholas Frappell, global general manager at Sydney-based ABC Bullion. "With real interest rates deep in negative territory and the coronavirus resurgence hitting the dollar index hard, that’s good for gold."

Chances of a Shelton nomination?

Sen. Susan Collins (R., Maine) is joining Sen. Mitt Romney (R., Utah) in opposing the nomination of controversial pick Judy Shelton to the Federal Reserve's board of governors. "In her past statements, Ms. Shelton has openly called for the Federal Reserve to be less independent of the political branches, and has even questioned the need for a central bank," Collins said in a statement. The nominee has also been a longtime proponent of a return to the gold standard, which would limit the Fed's ability to influence inflation and employment. Republicans have a 53-47 vote advantage in the Senate, meaning Shelton can't afford to lose more than three Republicans if all Democrats oppose her candidacy.

European bank dividends on hold

Billions of euros are at stake for investors as the ECB extended a request that banks hold off on returning capital until January 2021. The central bank first asked lenders in March to not make dividend payments until October in an effort to conserve capital as lockdowns to combat the pandemic brought the economy to a standstill. While the move was painful for shareholders, the ECB indicated it was a trade-off for unprecedented regulatory relief it had granted them to weather the crisis.

Navigating online dating during the pandemic

Match Group (NASDAQ:MTCH) has named Jim Lanzone, previous chief executive of CBS Interactive, as the new CEO of its flagship dating app Tinder. He definitely has his work cut out for him as the coronavirus pandemic redefines the online dating industry. Lanzone will join the company on Aug. 3, succeeding current Tinder CEO Elie Seidman, who is stepping down and returning to work with early-stage, venture-backed companies. Match Group controls much of the Internet dating scene, with other properties like OkCupid, Hinge and Plenty of Fish.

Upcoming Apple product launch dates

It's going to be a busy fall season for Apple (AAPL), according to well-known leakers iHacktu Pro and Komiya, who published the launch dates for every upcoming company product. The late 2020 updates will begin on August 19 with a new iMac, AirPods Studio, HomePod 2 and HomePod Mini, followed by an event on September 8 that will unveil the iPhone 12 line, iPad, Apple Watch Series 6 and AirTags. Another special event on October 27 will show off the Apple Silicon MacBook and MacBook Pro 13", iPad Pro and Apple TV 4K. There are also big expectations for a renewed AirPower charging mat, and smaller wireless charger AirPower Mini, as well as Apple Glass - the reported augmented reality smart glasses.

Court showdown over mask mandates

A Georgia judge hears arguments today in a case brought by Governor Brian Kemp to stop the city of Atlanta from enforcing a mask mandate that is punishable by a fine or up to six months in jail. Shares of mask makers like Alpha Pro Tech (NYSEMKT:APT), Allied Healthcare Products (NASDAQ:AHPI) and Lakeland Industries (NASDAQ:LAKE) are on watch as the emergency motion asks the judge to halt Atlanta's enforcement efforts while a lawsuit works its way through the courts. Kemp, one of the first governors to ease statewide stay-at-home orders and business closures, claims that Atlanta's measure is more restrictive than a state order which "strongly encourages face coverings" but does not require them.

Monday's Key Earnings

Hasbro (NASDAQ:HAS) -7.4% hit by movie theater closures.
NXP Semiconductors (NASDAQ:NXPI) -3.7% AH as weaker auto sales weighed on Q2 beats.

Today's Markets

In Asia, Japan -0.3%. Hong Kong +0.7%. China +0.7%. India +1.5%.
In Europe, at midday, London flat. Paris -0.6%. Frankfurt -0.3%.
Futures at 6:20, Dow -0.3%. S&P -0.3%. Nasdaq -0.3%. Crude -0.5% to $41.40. Gold -0.4% to $1922.90. Bitcoin -4.3% to $10795.
Ten-year Treasury Yield flat at 0.61%

Today's Economic Calendar

FOMC meeting begins
8:55 Redbook Chain Store Sales
9:00 S&P Corelogic Case-Shiller Home Price Index
10:00 Consumer Confidence
10:00 Richmond Fed Mfg.
11:30 Results of $24B, 2-Year FRN Auction
1:00 PM Results of $44B, 5-Year Note Auction

 

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