Great Hill Capital Chairman Thomas Hayes joins Seana Smith on The Ticker to discuss how the coronavirus could impact the U.S. economy moving forward.
Oil prices rocketed Thursday after US President Donald Trump said Russia and Saudi Arabia planned to end their price war by slashing output. But gains for Brent North Sea crude of nearly 46 percent cooled to around 20 percent as Russia denied it had spoken with Saudi Arabia, the world's biggest exporter of crude. After Trump tweeted that Saudi and Russia could slash production by up to 15 million barrels, Brent hit $36.29 per barrel, up almost 46 percent.
It seems President Trump is as deluded as ever with his grand statements -- perhaps not reckoning the sheer stroke of genius on the part of Saudi Arabia and Russia to actually corner the U.S. via crippling its shale oil industry. Oil prices are down 60% from the highs in February 2020 as price has been hit not only by around 25 million barrels per day of demand lost but also by the surge of around 3 mbpd, as Saudi Arabia finally gave up on being the lone player supporting this market to help U.S. shale and other players grab their lost market share. The oil market has been in perennial oversupply for the past two years, with only Saudi Arabia and Russia supporting the price by taking about 2 mbpd out of the market, helping the U.S. shale companies to keep pumping and raking in more revenue.
At times like this it must be a relief to have some of your retirement portfolio managed by Warren Buffett. Granted, Buffett and Berkshire Hathaway Vice Chairman Charlie Munger aren't the spring chickens they were during the dot-com crash or the global financial crisis, when they were spry youngsters in their 70s and early 80s. The company press office says Buffett is not planning to speak in public before May.
U.S President Donald Trump said on Thursday he had brokered a deal with top oil producers Russia and Saudi Arabia to cut output and arrest an oil price rout amid a global coronavirus pandemic, sending crude prices up by 45%. Trump said he spoke with Russian President Vladimir Putin and Saudi Crown Prince Mohammed bin Salman, and now expected the two nations to cut output by 10 million barrels per day (bpd) - an unprecedented number representing 10% of global supply. Trump said cuts could amount to as much as 15 million bpd but didn't say whether the United States, the world's largest oil producer, would contribute to reductions, a move which is forbidden by U.S. antitrust legislation.
There aren't a lot of investors who can say they warned clients about the coronavirus crisis and eventual 30% stock market collapse, but hedge fund founder Dan Niles is certainly one of them. In a February letter obtained by Yahoo Finance sent to clients of his long-short Satori Fund, Niles warned he was becoming “increasingly worried” that central bank accommodativeness was overshadowing the impact that COVID-19 would have on the global economy. After adjusting his position before the S&P 500 fell by more than 30%, his Satori Fund finished the first quarter in the green.
Shares plummet 80% for China's coffee giant Luckin Coffee after an investigation found that the company's COO fabricated sales. Yahoo Finance's On The Move panel discusses.
Like the big cats on the Netflix sensation Tiger King, refinances are roaring — while mortgage rates slink back near their lowest levels in history. As homeowners grab low rates by the tail to cut their monthly house payments, mortgage refinances have rebounded, a trade group says. For every $100,000 borrowed through a 30-year mortgage in 2020, you pay about $60 a month less than you would with a loan that was taken out 2019 when rates were higher, LendingTree chief economist Tendayi Kapfidze said recently.
The CEO of the Boeing Co. said Thursday that its commercial jet production will be impacted for years due to the aerospace fallout from COVID-19. The memo included the announcement of Boeing's (NYSE: BA) rollout of a voluntary layoff program that would enable eligible employees to leave the company with a pay and benefits package. A voluntary layoff program was initiated at Spirit AeroSystems Inc. in Wichita on Jan. 6 following Boeing's announced plan to temporarily halt production on the 737 MAX narrow-body jet.
Stock markets fell 4.4% yesterday, marking the third session in a row of losses. There's a feeling of gloom; President Trump has said that the country and economy are in for a hard two weeks in the first half of April as the coronavirus epidemic peaks in the States, and he walked back his previously stated hope to see the country 'get back to work' by mid-month. It's in times like these that investors, when they buy, start looking that much harder at dividend stocks.
In late February, when the U.S. stock market was in the early stages of slipping on news of the coronavirus outbreak, House Speaker Nancy Pelosi's husband, Paul, began buying up tech stocks and stock options. Paul Pelosi, a businessman and investor, paid up to $3.3 million in total to buy (GOOGL) (ticker: GOOGL) and (MSFT) (MSFT) stock options, and (WORK) stock (WORK), an April 1 regulatory filing from Speaker Pelosi shows. All three stocks have been outperforming the broader market, as measured by the S&P 500 index, although only Slack stock sports a year-to-date gain.
Tesla (NASDAQ: TSLA) CEO Elon Musk's rocket company SpaceX is banning employees from using video conferencing app Zoom Video Communications (NASDAQ: ZM), citing "significant privacy and security concerns," Reuters reported Wednesday. On Monday, the New York Times reported that the office of the New York Attorney General is probing Zoom's data privacy and security practices. In a letter to Zoom, the AG's office asked the telecommunications company what security measures it has taken in light of the increased traffic on its network, according to the Times.
As dozens of companies have cut or suspended dividends in recent weeks to preserve cash amid the uncertain impact of the coronavirus pandemic on the economy, the deteriorating payout picture has become a familiar refrain in this column. Barron's started with the S&P 500 Dividend Aristocrats, which have raised their dividends for at least 25 straight years, for ideas. The group has 64 members, and with the help of FactSet data, we whittled it down to eight that appear to have some bulwark to maintain their dividends, as the accompanying table shows.
Luckin Coffee (LK) shares collapsed after the company suspended its COO Jian Liu and “several employees reporting to him” for misconduct related to “fabricated transactions.” “The information identified at this preliminary stage of the Internal Investigation indicates that the aggregate sales amount associated with the fabricated transactions from the second quarter of 2019 to the fourth quarter of 2019 amount to around RMB2.2 billion,” the company said in a statement. “Certain costs and expenses were also substantially inflated by fabricated transactions during this period,” the company added.
Market forces rained on the parade of Arconic Inc. (NYSE:ARNC) shareholders today, when the analysts downgraded their forecasts for this year. Revenue estimates were cut sharply as the analysts signalled a weaker outlook - perhaps a sign that investors should temper their expectations as well. Following the latest downgrade, the current consensus, from the six analysts covering Arconic, is for revenues of US$6.0b in 2020, which would reflect a concerning 58% reduction in Arconic's sales over the past 12 months.
Immediately following Trump's tweet, Saudi Arabia came out to say it had called an “urgent meeting” of the OPEC+ alliance that includes Russia and some other unnamed nations to discuss a “fair agreement,” signaling it would only cut output if others do so. One person familiar with the Trump administration's discussions with the Saudis said there was widespread internal confusion about what the president was referring to in his tweet and that the figures he posted may not be reliable.
Already, it looks as if the U.S. is moving towards a temporary moratorium on mortgage payments. Fannie Mae and Freddie Mac unveiled an emergency program which provides a two-month deferral of mortgage payments for any homeowner who claims to be facing a hardship because of the virus. Many of you may sense that the virus has undermined what you thought was still a fairly strong housing market around the country.
America's largest exporter is offering pay and benefits packages to eligible employees who want to leave the company. The buyout plan comes three weeks after the company said it would freeze hiring and overtime pay except in critical areas to preserve cash. The coronavirus pandemic struck Boeing just as it was dealing with the crisis surrounding the grounding of its 737 MAX planes following fatal crashes.
“When it was first shown, it was called a concept, which suggests changes are likely,” Benchmark analyst Mike Ward said in an interview. Ward, a longtime auto analyst, doesn't cover Tesla (ticker: TSLA), but covers other auto manufactures and parts suppliers. “Tesla will be keeping the core Mad Max design and blocky unique look, which is the focus of Tesla loyalists.”
The latest analyst coverage could presage a bad day for Valero Energy Corporation (NYSE:VLO), with the analysts making across-the-board cuts to their statutory estimates that might leave shareholders a little shell-shocked. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic. After the downgrade, the consensus from Valero Energy's twelve analysts is for revenues of US$82b in 2020, which would reflect an uncomfortable 20% decline in sales compared to the last year of performance.
The average rate for a 30-year loan was 3.33%, down from 3.5% last week, Freddie Mac said in a statement Thursday. Rates for 30-year mortgages have been on a roller coaster since tumbling to a record low of 3.29% in early March. While public showings vanish and sales slow, some buyers in contract are trying to renegotiate prices, according to Patrick Boyaggi, chief executive officer of online mortgage marketplace Own Up.
Carnival Corporation & Plc (CCL) announced a $1.25 billion secondary offering when the battered cruise ship line's stock was trading at $13.00 on Tuesday morning. Meanwhile, rival Royal Caribbean Cruises Cruises Ltd. (RCL) has notified lenders that it's drawing down the balance of revolving credit agreements that will now add nearly $3.5 billion in outstanding debt. The company has stopped all sailings until at least mid-May and ran into a stone wall of resistance in Congress about funding a bailout because it is domiciled in Liberia, not the United States.
Unfortunately for some shareholders, the Wells Fargo (NYSE:WFC) share price has dived 34% in the last thirty days. All else being equal, a share price drop should make a stock more attractive to potential investors. In the long term, share prices tend to follow earnings per share, but in the short term prices bounce around in response to short term factors (which are not always obvious).
The husband of Georgia Sen. Kelly Loeffler recently acquired as much as $415,000 in stock in DuPont de Nemours, a chemical company that manufactures protective equipment in exceedingly high demand because of the coronavirus pandemic. The transaction, detailed in a mandatory disclosure the Republican filed late Tuesday, comes as senators in both parties have faced questions about the stock transactions they made in the weeks before the coronavirus upended the U.S. economy, wiping out jobs and personal wealth. Senate Intelligence Committee Chairman Richard Burr, R-N.C., whose sales of as much as $1.7 million in stocks have come under the most scrutiny, requested an ethics review of his actions in the days before markets dropped in February.
While the company has yet to alter production plans, it's taking a closer look at manufacturing rates for wide-body jets amid plunging demand, said a person familiar with the matter. Boeing was already planning to make fewer 787 Dreamliners this year, and is still assessing the rapidly changing market and public health issues as the outbreak guts travel demand and batters airlines. “When the world emerges from the pandemic, the size of the commercial market and the types of products and services our customers want and need will likely be different,” Chief Executive Officer David Calhoun said in a message to Boeing's 161,000 employees Thursday.
Kicking off the second quarter of 2020, all three of the major U.S. stock indexes dropped more than 4% yesterday in response to an update from the Trump administration. Late on March 31, the President stated the next two weeks will be “painful," with health officials predicting a significant spike in COVID-19-related deaths. As U.S. stock futures tick up on April 2, investors are worried the volatility is here to stay, and new economic data hasn't calmed these fears.