Below are press releases from company’s with preferred stock and baby bonds outstanding–or just news of general interest. News will be slow until early October when the 3rd quarter earnings start to hit.
The most important number of the day was the JOLTs (job openings and labor turnover) employment report showed softness is almost undoubtably here in the labor market. The softness was modest and in my mind supportive of a FOMC Fed Funds rate cut of 1/4%.
Employment is the most important piece of economic news (at least that is my opinion) –with strong employment recessions are held at bay and demand for goods and services remain high–so any softening starts to show cracks in the economy.
The JOLTs report for July shows that separations were up 336,000 with the largest layoffs in accommodations and food service which may show travel and dining out are softening.
The number of job openings at 7.7 million was about a million fewer openings than a year ago–actually a nice drift lower–Goldilocks?
So tomorrow we have ADP jobs and then on Friday the official government numbers of employment.
The 10 year treasury fell 3-4 basis points on release of the JOLTs numbers–now around 3.79%. Let’s see where this goes by the end of the week.
Below are press releases from company’s with preferred stock and baby bonds outstanding–or just news of general interest. News will be slow until early October when the 3rd quarter earnings start to hit.
I’ve been waiting all day for the ‘dead cat bounce’ in common shares but thus far no bounce is lasting more than 5 minutes—for the time being some serious profit taking has been taking place in tech shares (i.e. Nvidia).
Fortunately interest rates have set back 5 basis points which keeps all the income securities pretty flat on the day. While I have a little dry powder in the accounts I don’t plan to do anything today except watch–I am really anxious to get some employment numbers later this week. As I have mentioned I think (right or wrong) this will drive the September rate cut–Jay Powell has pretty much backed himself into a corner for a cut and so it is just a matter of whether it is 1/4 or 1/2%. Would the FOMC be brave enough to hold rates steady no matter the data? I don’t think so, but who knows for sure.
I have pondered selling a couple different issues in the near future–some I have tremendous gains in, but if I can’t replace the coupon don’t know whether it is wise to sell. For instance in 1 account I have a 24% capital gain in the Jackson Financial 8% fixed rate reset perpetual (JXN-A) and it is trading at $26.51. The issue becomes redeemable on 3/30/2028 so at some point in time it will max out the capital gain as it will trend (over time) back toward $25. Always a quandary. Maybe I will simply let go of 1/2 the position—we’ll see. Of note is the issue goes ex-dividend on Wednesday for 50 cents.
Well I see stocks are heading even lower–an unusual day to a trend one way or the other without even a modest countertrend move–but maybe today we go lower right into the close.
I hope everyone had a great labor day weekend. In Minnesota the weather was absolutely glorious at around 70 degrees with blue skies. The cool weather has done nothing to help the farmers as all the crops are way behind normal in many areas of the state and the combination of low prices and in this state, wet and cool weather is going to hurt. It is not often that low prices and poor crop conditions go hand in hand, but in this case Minnesota is an island of crops being way behind while the large producer states have bumper crops.
Last week the S&P500 closed at 5648 after trading in a range of 5560-5652. This less than 2 percent range was pretty tame given the debate over interest rates and the anticipation of, and discussion, surrounding interest rate cuts. Last weeks close was just a few basis points above the close the previous week. Looking at the futures this morning it looks like the September kickoff will be weak as the S&P500 is off over 1/2%–whether it holds is anyone’s quess.
The 10 year treasury traded up in yield last week at 3.91%–and it is at the same level this morning. This level is up 10 basis points from the close the previous week. This week we have what to me is the most important data points relative to the economy with the ADP employment number Thursday and the official government employment numbers on Friday. As I mentioned before these numbers will give us solid insight into whether the FOMC cuts 1/4% or 1/2% at the September 17-18 FOMC meeting.
The Fed balance sheet assets fell by $17 billion last week on the continual march down to $7 trillion.
The average $25 preferred and baby bond price was quiet last week with the average share price off 4 cents. Investment grade issues were down 6 cents, banks up 2 cents, mREIT preferreds up 7 cents and shippers off a dime.
