Janet Yellen spoke today and in her semiannual remarks to Congress she said the Fed is on track to continue lifting interest rates given the current strength in the U.S. labor markets. She noted however that weakness in commodities, China and the emerging markets, if they persist, could lead the Fed to moderate its policy decisions to maintain global stability. She also noted that a negative interest rate policy is not in the cards given that it might be illegal (not to mention highly devoid of intelligence aka “stupid”).
Stocks were mixed as the Dow fell and the NASDAQ traded higher. At the close the Dow was down 99 points to 15,914 on lighter volume. Stocks continue to trade at support but according to IBD, the markets are back in “correction” mode.
Disney reported record earnings yesterday and according to IBD, revenue was up 14% and net income was up 28%. Disney got a big bump from Star Wars and is also opening a theme park in Shanghai which could help drive future earnings. Both sales and profit numbers were record all-time highs but analysts bolted and sold shares because of concerns over ESPN (some call it “BSPN”) and the increasing cord cutting going on in the pay TV cable arena. You know people are in need of anxiety therapy when even Disney, home of the happiest place on earth, cannot make investors happy with record results.
Oil prices continue to seesaw back and forth as WTI crude lost 2% to trade near $27 per barrel and North Sea Brent gained 2% to $31 per barrel. Rumors of OPEC production cuts helped boost North Sea prices but WTI was off as stockpiles in the US have reached a point where oil representatives are now asking people with backyard swimming pools to rent them out for storage provided they get rid of the BBQ grill at the same time.
Gold eased back today falling $1.40 to $1,197 an ounce.