Week of June 9 2017 Weekly Recap & The Week Ahead
“Success if getting what you want. Happiness is wanting what you get.” — Dale Carnegie
1. Arab Nations Sever Ties with Qatar — four Arab states have cut off diplomatic ties with Qatar, as well as closing air and sea routes, pointing to Doha’s ties to terrorism. The coordinated move by Saudi Arabia, Egypt, the UAE and Bahrain marks a sharp escalation of a rift between the Persian Gulf states since late last month.
2. Global Market for Natural Gas Has Finally Arrived — the U.S. and China are working on a trade deal that could send vast quantities of gas pumped in Texas and Pennsylvania to factories in Shanghai and Guangdong. Improved access for U.S. exporters to China’s giant energy markets could boost overall global shipments. Thirty-nine countries now import LNG, up from 17 a decade ago, according to data and analytics firm IHS Markit. Several more, among them Uruguay, Bahrain and Bangladesh, are expected to lift the total to 46 in the next couple of years. The price differences also shrink. In 2012, Asia spot prices for LNG were $5.74 per million British thermal units higher than natural-gas prices in Europe, according to S&P Global Platts. This year so far, the difference has averaged less than $1.
3. S&P500 Brokeout to New All-time Highs — the S&P500 broke above the upper end of this consolidation from the past 3 months. Meanwhile, the list of stocks in the S&P500 also making new highs also broke out to the highest level since those March highs. According to to a research note by Sam Stovall of CFRA, “So far, 2017 has seen 17 new all-time closing highs for the S&P 500 and just 10 days where the index moved more than 1 percent in either direction. That kind of higher highs with low volatility always – yes, always – has been positive for the market, according to Sam Stovall, chief investment strategist at CFRA. The previous 17 times that has happened, the market has averaged a 19.4 percent gain, with advances happening 100 percent of the time.”
4. British PM Theresa May Looks to Form New Government — Prime Minister Theresa May will seek permission from the Queen to form a new government, according to a spokesperson, despite calls for her to resign after a bruising election. Her Conservative party lost its majority, with Labour gaining significant ground, resulting in a hung parliament. Furthermore, The U.K. could suffer another ratings downgrade after a general election led to a hung parliament, according to S&P Global. The country lost its AAA rating last June following its vote to leave the EU. S&P said at the time it was worried the decision would lead to a deterioration of Britain’s economic performance and institutional framework.
5. FDA Wants Endo’s Opana ER Off the Market Due to Abuse Potential — in an unprecedented move, the FDA has notified Endo International’s (NASDAQ:ENDP) Pharmaceuticals unit that it wants opioid pain med OPANA ER (oxymorphone HCl) removed from the market due to its abuse potential. It comes after a panel of advisers concluded in March that the drug’s benefits did not outweigh the risks – opioids were involved in more than 33,000 deaths in 2015.
6. Technology darlings Stocks Reversed Hard in the Last 2-day — most notable being the NASDAQ (-1.8%) and the Philadelphia Semiconductor Index (- 4.23%), as can be seen in the attendant chart below.
The week ahead — Economic data from Econoday.com:
