The Dow had a hiccup today amid the release of Jr.’s emails, but then quickly recovered and traded most of the second half of the day in the positive before posting a gain of half a point to close at 21,409. Amazon took “Prime Day” so seriously that they discounted their own stock price 2 points today. Not sure if these were also part of “Prime Day”, but Snapchat was on deep discount after analysts at Morgan Stanley (lead underwriter that took them IPO) downgraded the stock, and the U.S. Senate has decided to cut back their vacation from 5 weeks to 3 weeks so they can get things done…presumably. Crude oil on the other hand continued to rise, topping $45 today and was at $45.06 at the close.
After economic concern over the lack of jobs was alleviated with the news that 222,000 new jobs were created in June, market skeptics are now concerned over the high levels of debt being carried by nonfinancial corporations, citing debt is at its highest relative to GDP. In an article written by economist Brian Westbury he explains that debt levels are right in the average range relative to corporation’s assets for the last 10, 20, or even 30 year periods, and threw in some common sense by stating, “these companies don’t pay their debt with GDP. They hold debt against assets and incomes.”
President Trump has also nominated Randal K. Quarles to the Federal Reserve position of Vice Chairman for Supervision, the top position that oversees Wall Street. Mr. Quarles is a former Treasury Department official under the Bush administration from 2002 to 2006, and this nomination appears to be in line with the President’s pro-business stance and support for fewer regulations. Last year, Mr. Quarles wrote an op-ed article for the WSJ where he warned against “arbitrarily taking an ax to big banks and irreparably damaging the economy”.
In other news, Louis Winthorpe III and Billy Ray Valentine are still sticking it to the Duke brothers from “Trading Places” as orange juice futures have had the biggest decline in soft commodities since March.