Week of Apr 28 2017 Weekly Recap & The Week Ahead
“Know what you own, and know why you own it.” – Peter Lynch
1. U.S. Moves to Impose 20% Tariff on Canadian Lumber — the Trump administration has taken a first step toward imposing a 20% tariff on Canadian softwood timber – the type of wood used for residential home construction. About $5B of Canadian exports to the U.S. will be subject to the tax. The decision is preliminary and still has to go through a couple of bureaucracies before any tariff is collected.
2. East Coast Refiners Eye Texas Oil Delivery Via Ship — U.S. East Coast refiners, including Phillips 66 (NYSE:PSX) and Monroe Energy (NYSE:DAL), are looking to move more crude by ship from Texas into the Philadelphia area. It’s the latest twist in a trade flow upheaval resulting from the opening of more pipelines in North Dakota; as the discounts of Bakken crude disappeared, so did the rail cars that transported the commodity.
3. Retail Store “Brick-and-Mortar” Closings at Record Pace — american retailers are closing stores at a record pace, with 2,880 retail closing announcements this year, more than double the number from the same period in 2016. Just last week, Bebe Stores (NASDAQ:BEBE) said it would close its remaining 170 shops and sell only online, while Rue21 announced plans to close about 400 of its 1,100 locations. If the pace continues, more retailers will close shop than during the 2008 recession.
4. South Korea Deploys Parts of THAAD System in a Deterrent of N. Korea — amid high tensions on the Peninsula, the U.S. military has started moving key parts of its controversial THAAD anti-missile defense system to a deployment site in South Korea. The move, which has angered North Korea, China and Russia, prompted protests by hundreds of local residents and was denounced by the frontrunner in South Korea’s presidential election.
5. China Concerned by U.S. Aluminum Probe — China is concerned by the second U.S. national security trade probe into imports of aluminum and hopes to resolve the dispute through talks, according to Commerce Ministry spokesman Sun Jiwen. “It’s very, very dangerous, obviously, from a national defense point of view” only to have one producer of a material needed for defense, U.S. Commerce Secretary Wilbur Ross declared, citing applications in armor and advanced aircraft.
6. 1Q GDP Weakest in Three Years, as Consumer Spending Falters — gross domestic product increased at a 0.7 percent annual rate also as the government cut back on defense spending. A measure of private domestic demand increased at a 2.2 percent rate last quarter. First-quarter GDP tends to under-perform because of difficulties with the calculation of data that the government has acknowledged regarding the seasonal quirk and temporary restraints.
The week ahead — Economic data from Econoday.com:
