Markets Rally With Wall Street As Powell Eases Inflation Fears

Traders work on the floor of the New York Stock Exchange (NYSE) the morning after U.S. President Donald Trump was impeached by the House of Representatives on December 19, 2019 in New York City. Despite the events in Washington, markets were up sharply in morning trading. Spencer Platt/Getty Images/AFP


Asian and European equities rallied Wednesday, tracking a strong performance on Wall Street as Federal Reserve chief Jerome Powell said he was determined to rein in runaway inflation but pledged to maintain the healthy recovery in the world’s top economy.

Global markets have endured a torrid start to the year after minutes from the bank’s December meeting revealed a hawkish tilt by officials spooked by months of stubbornly high price rises that many fear could hit consumers and ruin the growth rebound.

They showed policymakers wanted to speed up their cycle of monetary tightening, including multiple interest rate hikes — some commentators saying four this year — and the shrinking of the bond holdings on its balance sheet, which help keep lending rates down.

Traders have been worried by the prospect of an end to the ultra-loose policies, which have helped power a two-year market rally and support the pandemic-hit economy.

But Powell managed to soothe some of those fears Tuesday during his Senate reconfirmation hearing.

He said the economy was on a strong footing, and with inflation rising and employment recovering, “the economy no longer needs or wants the very highly accommodative policy”.

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Inflation was “very near the top of the list” of risks to the economic outlook, he said, adding that the current rate is “very far above target”.

Prices are currently rising at their fastest pace in four decades owing to a number of pressures including surging wage growth, supply chain snarls and high energy costs.

The Fed expects a “return to normal supply conditions” in the coming months, Powell said, but “if we see inflation persisting at high levels longer than expected… we will use our tools to get inflation back”.

The comments were taken by traders to be less hardline than feared, suggesting recent fears about a swift removal of easy-money measures may have been overdone.

Michael Hewson of CMC Markets said Powell appeared “mindful of the dangers of going too quickly in draining liquidity, although he was clear to stress that the Fed was also alive to the risks of acting too slowly, in curbing inflation risks”.

– Music to the ears –

And Matt Simpson, of StoneX Financial, added: “Jerome Powell telling the congressional hearing that the US economy will be able to withstand the combination of Omicron and the Fed tightening was music to Wall Street’s ears.

“And with markets getting too used to the idea of inflation being rampant, perhaps expectations (for much higher inflation) are ahead of themselves.”

Simpson added that if US inflation figures came in below forecasts later Wednesday, that “could be enough to shake out some pre-emptive doom-mongers and further support equities, as part of the reason they sold off was the upward revision to Fed hikes, based upon inflationary fears”.

Wall Street cheered, with Nasdaq climbing more than one percent, having taken a severe hit recently as tech firms are more susceptible to higher borrowing rates.

The gains extended into Asia, with Hong Kong up 2.8 percent, thanks to a boost in tech firms, and Tokyo up a little shy of two percent.

Seoul and Manila were also up more than one percent, while Shanghai, Sydney, Taipei, Mumbai and Bangkok were up. London, Paris and Frankfurt were all well up at the open.

Data showing Chinese factory gate and consumer inflation grew slower than expected — and left room for the central bank to cut interest rates — provided extra support.

While most observers expect equities to endure some tough times in the near future, they remain broadly upbeat about the outlook for this year.

OANDA’s Edward Moya said he remained optimistic for three reasons.

“Household and corporate balance sheets remain very healthy, the upcoming earnings season should be strong, and the economy will still see above-trend growth even if the Fed raises rates three times and begins the balance sheet runoff in the summer.”

The upbeat vibe helped oil markets hold on to Tuesday’s more than three percent rally, which was fired by the Energy Information Administration lifting its 2022 price forecast by almost $5 from its December projection as worries ease about the Omicron coronavirus variant.

– Key figures around 0820 GMT –

Tokyo – Nikkei 225: UP 1.9 percent at 28,765.66 (close)

Hong Kong – Hang Seng Index: UP 2.8 percent at 24,402.17 (close)

Shanghai – Composite: UP 0.8 percent at 3,597.43 (close)

London – FTSE 100: UP 0.5 percent at 7,527.89

Dollar/yen: UP at 115.43 yen from 115.28 yen late Tuesday

Euro/dollar: DOWN at $1.1366 from $1.1371

Pound/dollar: DOWN at $1.3633 from $1.3637

Euro/pound: DOWN at 83.35 pence from 83.38 pence

West Texas Intermediate: UP 0.2 percent at $81.40 per barrel

Brent North Sea crude: UP 0.1 percent at $83.77 per barrel

New York – DOW: UP 0.5 percent at 36,252.02 (close)

Global Stocks Rise As Recovery Signs Offset New Lockdowns

In this file photo Traders work during the opening bell at the New York Stock Exchange (NYSE) on March 19, 2020, at Wall Street in New York City. Johannes EISELE / AFP
In this file photo Traders work during the opening bell at the New York Stock Exchange (NYSE) on March 19, 2020, at Wall Street in New York City. Johannes EISELE / AFP



Equities rose Thursday following a record lead from Wall Street, with investors cheered by hopes for a vaccine, more positive economic data and further lockdown easing in Europe.

The developments helped offset a worrying spike in infections in the United States, which has led to the reimposition of containment measures that could slow recovery in the world’s top economy, and warnings of worse to come.

Hong Kong led the gains on reopening after a one-day break, despite concerns about a new security law imposed on the city by China that observers said was more draconian than feared and could impact its future as an attractive business hub.

And while there are worries about the issue causing further friction between Beijing and the West, markets remain positive for now.

The Hang Seng Index rose more than two percent, while Shanghai ended up 2.1 percent.

Sydney, Mumbai, Seoul, Wellington and Bangkok were all up more than one percent, while Manila also chalked up more than two percent gains.

Taipei, Singapore and Jakarta were all in positive territory.

Tokyo ended up 0.1 percent with signs of a flare-up in new cases in the Japanese capital weighing on sentiment.

London and Paris opened 0.7 percent higher, while Frankfurt piled on one percent.

The gains came after another all-time high for the tech-heavy Nasdaq on Wall Street, with investors now awaiting the release of key US June jobs data later in the day for a better grip on the economy following May’s surprise jump in employment.

There was some cheer as figures from payroll services firm ADP showed a 2.37 million increase in private jobs — slightly below forecasts — though it added that 3.06 million posts were created in May, a revision from its initial report of 2.76 million lost.

Adding to signs that the worst of the economic hit may have passed, US factory activity began growing again, while the rise in German retail sales was four times more than expected in May.

Meanwhile, hopes for a vaccine were given a boost after Germany’s BioNTech and US pharmaceutical giant Pfizer reported positive preliminary results from a joint project, which showed positive antibody responses.

Europe continued with its lockdown easing, with the EU reopening its borders to visitors from 15 countries, while Spain and Portugal held a ceremony to free up their land border.

And the Netherlands confirmed the lifting of measures imposed on its brothels and red light districts.

Europe opens, US closes

“It’s been a risk-positive start to the new quarter, starting as the old one went out, with more positive data surprises out of the US and encouraging news regarding potential coronavirus vaccine development,” said National Australia Bank’s Ray Attrill.

But he warned of a “need to be on guard for the recent stalling or even reversal of social distancing restrictions in many US states prompting setbacks in some of these readings in coming months.”

There are increasing worries over a second wave of infections elsewhere, led by the United States, which on Wednesday reported more than 50,000 new cases for the first time and several US states imposed 14-day quarantines on visitors ahead of the July 4 weekend celebrations.

California suspended indoor dining at restaurants in Los Angeles and several counties, while New York scrapped plans to allow restaurants to seat customers inside from next week.

Apple announced it would close another 30 US stores on Thursday, half of them in California.

And the World Health Organization warned that with more than 10 million known infections worldwide and more than 500,000 deaths, the pandemic is “not even close to being over”.

“There’s this inherent tension between health of the economy and health of the population,” said David Lebovitz, a strategist at JPMorgan Asset Management.

“It’s going to be the way to think about what drives markets over the next couple of weeks or months.”

– Key figures around 0720 GMT –
Hong Kong – Hang Seng: UP 2.2 percent at 24,955.55

Tokyo – Nikkei 225: UP 0.1 percent at 22,145.96 (close)

Shanghai – Composite: UP 2.1 percent at 3,090.57 (close)

London – FTSE 100: UP 0.7 percent at 6,201.10

West Texas Intermediate: UP 0.6 percent at $40.06 per barrel

Brent North Sea crude: UP 0.6 percent at $42.30 per barrel

Euro/dollar: UP at $1.1272 from $1.1249 at 2100 GMT

Dollar/yen: UP at 107.51 yen from 107.43 yen

Pound/dollar: UP at $1.2492 from $1.2468

Euro/pound: UP at 90.23 pence from 90.19 yen

New York – Dow: DOWN 0.3 percent at 25,734.97 (close)





COVID-19: From Wall Street To Bethlehem, Iconic Sites Reopen Across The World

A trader walks in front of the New York Stock Exchange (NYSE) on May 26, 2020 at Wall Street in New York City. Johannes EISELE / AFP
A trader walks in front of the New York Stock Exchange (NYSE) on May 26, 2020 at Wall Street in New York City. Johannes EISELE / AFP


Iconic world sites from the New York Stock Exchange to the Church of the Nativity reopened their doors Tuesday from the coronavirus pandemic, but new alarm bells rang in Latin America over a spike of infections.

In a symbolic return of a high altar of capitalism, the New York Stock Exchange — which had gone exclusively virtual for two months — allowed a limited number of traders to return to the trading floor, wearing masks to reduce the risk of infection.

The reopening boosted the mood as the benchmark Dow Jones index surged more than 2.2 percent, casting aside grim predictions that the world could be entering a new Great Depression after millions of job losses.

Visiting Wall Street, New York Governor Andrew Cuomo called for swift work on long-mulled mega-infrastructure projects such as subway extensions in the hard-hit metropolis.

“Let’s do something creative, let’s do it fast. Let’s put Americans back to work,” Cuomo told reporters.

There were also signs of hope at some of the world’s best-known destinations including the Church of the Nativity in Bethlehem, built on the spot where Christians believe their saviour Jesus was born.

The church’s opening “gives hope to the world that this pandemic will end,” said Rula Maaya, the Palestinian tourism minister.

The illness has killed more than 346,000 people worldwide and forced most countries to mothball their tourism industries, a crucial source of revenue.

‘Sense of emptiness’

In Italy, the global epicenter of infections after the virus spread to Europe from China, the site of a previous natural disaster also reopened to visitors — the ruins of the Roman city of Pompeii, destroyed by a volcanic eruption in 79 AD.

But the site, which attracted four million visitors last year, was largely deserted as foreign visitors are still banned from travel to Italy until next month.

“It’s only us guides, and journalists,” sighed 48-year-old Valentina Raffone, noting a “sense of emptiness, of sadness” as if after a disaster on the scale of the city’s end.

Italian Foreign Minister Luigi di Maio said he was working with EU colleagues to agree on June 15 as a coordinated day for member states to reopen their borders.

“We should save what we can save of the summer, to aid our entrepreneurs,” he said.

The Vatican too has relaxed its lockdown, announcing that Pope Francis will address the faithful once more from his window overlooking Saint Peter’s Square on Sunday.

And Russia said it had passed its peak of infections, promising to hold postponed World War II victory celebrations next month.

“The risks for all participants should be minimized, or even better, eliminated,” President Vladimir Putin said.

His announcement came as Russia recorded its highest daily coronavirus death toll of 174, with a caseload of 362,342, the third-highest number of infections in the world after the United States and Brazil.

Latin America epicenter

There was no mistaking that the coronavirus was taking a growing toll in South America.

With about 730,000 cases — out of 5.5 million globally — Latin America has outpaced Europe and the United States in the number of daily infections.

“In South America, we are particularly concerned that the number of new cases reported last week in Brazil was the highest for a seven-day period, since the outbreak began,” said Carissa Etienne, director of the Washington-based Pan American Health Organization.

“Both Peru and Chile are also reporting a high incidence, a sign that transmission is still accelerating in these countries,” she said at a weekly briefing.

Latin America’s largest airline LATAM, which has more than 42,000 employees, became the latest carrier to file for bankruptcy as COVID-19 devastates aviation.

Virus countermeasures have been especially politicized in Brazil, whose right-wing president, Jair Bolsonaro, has downplayed the illness and lashed out at state governors who have asked people to stay at home.

Police on Tuesday raided the official residence of one of Bolsonaro’s leading critics over the coronavirus response, Rio de Janeiro Governor Wilson Witzel, alleging that he embezzled public funds for the virus.

Witzel called the raid “political persecution” and warned: “What happened to me is going to happen to other governors who are considered enemies.”

Political controversies

Controversies surrounding the coronavirus have intensified around the world. In Britain, Prime Minister Boris Johnson is in crisis mode after his top aide, Dominic Cummings, flouted the government’s lockdown by taking a cross-country trip during the lockdown.

Douglas Ross, a minister for Scotland, resigned in protest, saying of families who could not mourn loved ones during the lockdown: “I cannot in good faith tell them they were all wrong and one senior advisor to the government was right.”

US President Donald Trump, an ally of both Johnson and Bolsonaro, has weathered a torrent of criticism for playing golf as the death toll in his country neared 100,000 on the weekend and for not wearing a mask in public.

Trump responded by retweeting criticism of his presumptive election rival, Joe Biden, for following health guidelines by wearing a mask during Memorial Day commemorations.

With barely five months before elections, Trump is eager to show a return to normal in the United States and tweeted Tuesday of the surge on Wall Street that the “Transition to Greatness has started.”

European Commission President Ursula von der Leyen is set on Wednesday to unveil her own trillion-euro proposal to revive the economy of the bloc, whose leaders are likely to argue over its details.

With the search for a vaccine potentially still in its infancy, the World Health Organization was left to ponder a very different development on Tuesday.

Two Dutch workers seem to have caught the disease from minks, which “would be the first known cases of animal-to-human transmission,” the UN health agency said.

The agency said pet owners should take precautions but there was “no reason or justification to take measures against companion animals.”

Wall Street Problems Grow As Oil Prices Tumble

Traders work during the opening bell at the New York Stock Exchange (NYSE) on March 5, 2020 at Wall Street in New York City. Johannes EISELE / AFP
Traders work during the opening bell at the New York Stock Exchange (NYSE) on March 5, 2020 at Wall Street in New York City. Johannes EISELE / AFP


Wall Street stocks fell sharply Friday afternoon and oil prices tumbled around 10 percent as markets headed to another ugly finale on worries the coronavirus will lead to a global recession.

Near 2025 GMT, the Dow Jones Industrial Average was down 2.7 percent at 25,415.78.

The broad-based S&P 500 sank 3.4 percent to 2,921.19, while the tech-rich Nasdaq Composite Index tumbled 3.5 percent to 8,378.03.

Traders essentially ignored strong US jobs data for February, viewing the report as outdated and not representative of an economy now pressured by worries that include supply chain disruption in China, a contraction of global travel and anxiety that fear of illness will stifle the consumer-driven US economy.

Demand remained elevated for secure assets such as bonds, with the yield on the 10-year US Treasury note falling to a fresh all-time low.

The rout in the equity market has wiped out roughly $4 trillion of household worth in the last two weeks, according to IHS.

“Unless reversed fully and quickly, this will weigh on consumer spending over the next few years,” IHS said in a report. “More immediately, weakening consumer attitudes will likely slow consumer spending in the second quarter, and businesses are likely to put some investment plans on hold until the outlook clears up.”

In the oil market, the US benchmark futures contract, West Texas Intermediate for delivery in April, ended at $41.28 a barrel, down 10.1 percent.

In London, Brent oil futures for delivery in May finished down 9.4 percent at $45.27 per barrel. Both WTI and Brent ended at their lowest levels since April 2016.

The big drop came after major producers failed to agree to production cuts after Russia balked at a proposal by the Organization of the Petroleum Exporting Countries to trim crude output by 1.5 million barrels per day in face of the lower demand due to the epidemic.

Andrew Lebow of Commodity Research Group said oil prices were getting low enough to threaten some US producers, raising the prospect of loan defaults, or even bankruptcy.

“At the very least, there will be some negotiating on the loans, capital is already tight,” Lebow told AFP. “If we’re here for a while, that’s problematic.”



Boeing To Halt Production Of Grounded 737 Max In January

(FILES) In this file photo taken on March 27, 2019 Employees work on Boeing 737 MAX airplanes at the Boeing Renton Factory in Renton, Washington. 
Jason Redmond / AFP


Boeing said Monday it would temporarily suspend production of its globally grounded 737 MAX jets next month as safety regulators delay the aircraft’s return to the skies after two crashes.

The decision confirmed investor fears that the company’s recovery from the crisis is dragging on longer and creating more uncertainty for Boeing than executives anticipated.

Boeing’s travails since March have weighed on the US economy, holding down American manufacturing output, trade, and sales of durable goods while damaging the company’s performance on Wall Street’s benchmark Dow Jones Industrial Average.

In a statement, the company said it would continue to pay its workers despite the temporary production stoppage, but the decision immediately raised questions for the future of parts suppliers that contribute to the jets’ manufacture.

“We have previously stated that we would continually evaluate our production plans should the MAX grounding continue longer than we expected,” the company said in a statement.

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“As a result of this ongoing evaluation, we have decided to prioritize the delivery of stored aircraft and temporarily suspend production on the 737 program beginning next month.”

The company said it would focus on delivering 400 jets it has kept in storage.

Though the jets have been grounded worldwide since March following deadly crashes in Indonesia and Ethiopia, which left 346 people dead, Boeing had continued to produce 40 of the planes per month at a Renton, Washington facility.

Shares Tumble On Wall Street

Last week, US aviation regulators issued the company an unusually sharp rebuke, accusing it of pursuing an “unrealistic” timeline for the MAX’s return to service and of making public statements intended to put pressure on federal authorities.

The Federal Aviation Administration said Wednesday it could not approve the jets’ return to service before 2020, even though Boeing had long said it planned to get officials’ green light before the end of this year.

Boeing and the FAA have been under intense scrutiny for their responses to issues with the aircraft, including the flight-handling system involved in both accidents, the Maneuvering Characteristics Augmentation System, or MCAS.

“Boeing seems to have finally come to terms with the new reality that international safety regulators will not be bent to their whim, and the process of returning these planes to service is not as simple as a quick software fix,” Senator Richard Blumenthal said in a statement.

Analysts say Boeing’s prospects will remain clouded until Boeing can get the all-clear for the MAX to fly again.

“As we have throughout the 737 MAX grounding, we will keep our customers, employees and supply chain top of mind as we continue to assess appropriate actions,” the company said, adding that it will disclose financial information tied to the suspension when it releases quarterly results late next month.

Major air carriers that had purchased 737 MAX jets have repeatedly pushed back the dates on which they anticipate a return to service.

Southwest said Thursday it had reached a confidential agreement with Boeing partially compensating the airline for costs related to the grounding of the jets.

Nevertheless, the manufacturer in November unveiled an updated version of the jet, the 737 MAX 10.

Shares in Boeing fall 4.3 percent as investors anticipated Monday’s decision. They were down another 0.4 percent in after-hours trading at 2300 GMT.


Oil Prices Shoot After Saudi Drone Attack


Crude prices shoot higher, Wall Street sank into the red on Monday, after weekend drone attacks knocked out much of Saudi Arabia’s oil production.

The lower open threatened to break an eight-day winning streak for the benchmark Dow Jones Industrial Average, with the major US stock indices just below fresh record highs.

Markets were also digesting a batch of poor economic data out of China and awaiting Wednesday’s Federal Reserve announcement on monetary policy.

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Ten minutes into the day’s trading, the Dow and broader S&P 500 were both down 0.4 percent at 27,112.32 and 2,996.52 respectively.

The tech-heavy Nasdaq was 0.5 percent lower at 8,139.64.

While the spike in oil prices — WTI benchmark crude was up a towering $5.32 at $60.17 per barrel — sent oil stocks higher, investors may fear more expensive oil could further slow an already waning global economy.

Oil supermajors Exxon Mobil and Chevron were up 2.6 percent and 2.7 percent respectively.

Fresh economic data on Monday showed activity in China slowed last month across the board, with the pace of industrial production, retail sales and investment in fixed assets all lower.

In the United States, automaker General Motors was down 2.9 percent after unionized autoworkers began a nationwide strike over disagreements on wages, health care benefits and job security.

The Federal Reserve is widely expected to announced an interest rate cut on Wednesday, the second of the year, as the American economy slows with the rest of the world and President Donald Trump’s trade conflicts drag on.


Apple Reaches New Landmark With $1 Trillion Valuation

(FILES) In this file photo taken on September 14, 2016, the Apple logo is seen at the entrance to the Fifth Avenue Apple store in New York.  PHOTO: Don EMMERT / AFP


Apple — the culture-changing company behind the iPod, iPhone and iPad — hit another milestone on Thursday, becoming the first private-sector company to surpass $1 trillion in market value.

Shares of Apple finished the formal Wall Street trading day at $207.39, topping the magic number, two days after the California tech giant reported strong quarterly earnings.

The landmark is the latest victory for Tim Cook, who faced scepticism when he took over as chief executive in 2011 from ailing iconic co-founder Steve Jobs.

Jobs, who founded Apple in a Silicon Valley garage in 1976 with Steve Wozniak and built it into a global powerhouse, died in October 2011.

After his death, analysts and other industry watchers wondered whether the company would lose its ability to wow the world with “the next big thing.”

But Cook has gradually won accolades from investors by pumping out a series of solid financial results and spreading Apple’s products to China and other foreign markets.

Apple is the first private sector company to reach this level. State oil company PetroChina briefly broke the $1 trillion barriers in 2007 during its initial public offering but has since dropped back down.

“Of course I’m proud of Apple, but I don’t measure the world by human simplifications like round numbers,” co-founder Wozniak was quoted as telling Yahoo Finance.

US tech companies have cemented their position in the broader market, now making up the top five most valuable enterprises based on share prices.

Behind Apple are Amazon, Google parent Alphabet, Microsoft and Facebook.

A trillion dollars is roughly the annual gross domestic product of Indonesia, and more than twice that of Belgium, according to World Bank data from 2016.

As with other landmarks — such as the Dow crossing 25,000 points for the first time — the Apple record is significant because of its resonance beyond the financial universe.

“The $1 trillion mark is more psychological, and sends a message of growth and size into the market,” said Howard Silverblatt, senior index analyst at S&P Dow Jones Indices.

But many financial insiders view the record as a non-event.

“There’s no real excitement on the trading desk,” said Karl Haeling of LBBW. “It’s one of those things that does not mean anything by itself… it’s more a testimony of the importance of Apple on the market.”

Focus on digital content

Apple has sold more than a billion iPhones since the first model was unveiled by Jobs in 2007.

Billions of dollars that Apple has been spending to buy back shares was thought to have helped propel the company past the one-trillion-dollar mark for market value.

The company is in the unique situation of controlling the hardware and software in its mobile devices, with content for users required to go through its App Store that takes a percentage of revenue.

Apple also released a kit for developers to create augmented-reality experiences on iPhones or iPads, saying that “overnight iOS became the biggest AR platform in the world.”

It has moved to keep up with trends in artificial intelligence and voice-commanded smart speakers.

Virtual assistant Siri is built into Apple devices, and the company boasts the most popular smartwatch on the market.

Cook has consistently touted innovations in the pipeline at the famously secretive company.

Last month, an ex-Apple engineer was charged in California with stealing trade secrets from a hush-hush self-driving car technology project days before he quit to go to a Chinese start-up.

‘Making technology simple’

Apple has been credited with giving rise to lifestyles centred around mobile apps for seemingly everything from games and messaging to ordering food or summoning car rides.

“At the core, I think Apple’s biggest revolution has been putting consumer experience first and making technology simple,” said Creative Strategies analyst Carolina Milanesi.

But the phenomenal success of the iPhone led competitors to mirror certain features like touch-screens featuring rows of colourful icons — and prompted Apple to pursue those competitors in court.

Apple has fought myriad patent battles with rivals, particularly South Korean consumer electronics colossus Samsung, arguing that its product design is as much its intellectual property as the hardware and software.

In a US regulatory filing this week, Cook warned tariffs being imposed in a US-China trade war could result in Apple paying more to make its products, eating into profit or forcing up prices for consumers.

“Our view on tariffs is they show up as a tax on the consumer and wind up resulting in lower economic growth, and sometimes can bring about the significant risk of unintended consequence,” Cook said during an earnings call.

Independent technology analyst Rob Enderle said Apple’s trillion-dollar valuation defied financial trends in recent quarters and potential defeat in a legal battle with Qualcomm over mobile chips.

“My view is they are on a bubble, and it is a big bubble,” Enderle said.

“I am expecting to see a correction. Basically, it is still the iPhone company.”

China-based Huawei took the second-place spot from Apple in a tightening global smartphone market during the second quarter of this year, according to the International Data Corporation.

Samsung remained the top smartphone maker.


Dow Sheds 450 Points As US Stock Sell-Off Deepens

Traders work on the floor of the New York Stock Exchange (NYSE) on February 5, 2018 in New York City.  SPENCER PLATT / GETTY IMAGES NORTH AMERICA / AFP


Wall Street stocks fell sharply for a second straight session Monday with the Dow losing about 450 points amid worries over rising US interest rates.

Near 1840 GMT, the Dow Jones Industrial Average had lost 1.7 percent to 25,090.48.

The broad-based S&P 500 fell 1.5 percent to 2,721.58, while the tech-rich Nasdaq Composite Index sank 1.0 percent to 7,17052.

After streaking to numerous records in the first three weeks of the year, US stocks last week began to pull back. And Friday’s strong jobs report contributed to the sell-off amid rising concern the US Federal Reserve will accelerate the pace of interest rate hikes this year.

JJ Kinahan, chief market strategist of TD Ameritrade, said the key question as the pullback moved into its second week was whether investors would step in to purchase stocks at depressed values.

Investors have done this for than a year, each time a price decline offered bargain prices, preventing any major correction.

“We’re finally getting the (long-discussed) five percent drop,” Kinahan said. “Do the people who buy the dip come in again?”

A catalyst for the decline over the last week or so has been the rise in US Treasury bond yields.


Obama Officials Work Against Time To Wrap Banking Rules

obama-officialsU.S. officials are striving to put finishing touches on a slew of banking rules before President Barack Obama leaves office and hands regulatory power to Donald Trump who has vowed to rewrite the existing financial rule book.

President-elect Trump will take over on Jan. 20 and his fellow Republicans will have control of Congress and government agencies, allowing the new administration to block or roll back many of the last-minute changes.

But by completing far-advanced work on some banking standards in the next 10 weeks, Obama officials would raising the chances that some elements of the regulatory framework will survive.

Some rules are meant to flesh out the Dodd Frank Act of 2010 designed to prevent the next global financial crisis. Trump campaigned on a pledge to scrap the law but now he says only some provisions must go to lighten the regulatory burden.

The Federal Reserve is working on rules to govern matters such as executive pay, market stability and what investments Wall Street may hold.

Last month, Securities and Exchange Commission Chair Mary Jo White said her agency would “in the near term” finish a rule on one thorny issue: how mutual funds manage derivatives.

The SEC and bank regulators have also for years struggled to finalize a rule that would tie more banker pay to the long-term health of their firms rather than short-term performance of Wall Street firms.

With only about 40 working days until the handover, it is not clear which, if any, of those standards will get across the finishing line.

“Just look at the calendar,” said Tom Quaadman of the Chamber of Commerce. “These are intricate rules and there’s not much time.”

The executive pay rule exemplifies the challenge.

Six federal agencies have a say on the compensation standard meant as part of Dodd Frank and a final draft has not yet been offered, industry officials told Reuters.

It would be nearly impossible to circulate a final rule and get the agencies to endorse it while still satisfying standards for clearing such paperwork, several lobbyists who have opposed the rule said.

Banking regulators declined to comment on when the compensation rule might be complete

Hillary Clinton Gets Required Delegates For Democratic Nomination

Hillary ClintonReports say White House hopeful, Hillary Clinton may have clinched the democratic nomination for US President after reaching the required number of delegates.

An Associated Press (AP) count puts Mrs Clinton on 2,383 – the number needed to make her the presumptive nominee. If confirmed, she will become the first female nominee for a major US political party.

Clinton’s delegate count is expected to grow on Tuesday when six states, including California and New Jersey, hold contests.

Speaking in Long Beach, California, on Monday, Clinton said she was still focused on Tuesday and the votes that may come from those states.

“We are on the brink of a historic, historic unprecedented moment but we still have work to do, don’t we?” she said. “We have six elections tomorrow and are going to fight hard for every single vote, especially right here in California.”

Rival, Bernie Sanders, however, said that Mrs Clinton has not won as she is dependent on super delegates who cannot vote until the party’s July convention.

A Sanders campaign spokesman, Michael Briggs said that it was wrong to count the votes of super delegates before they cast ballots at the Democratic National Convention in July.

“Our job from now until the convention is to convince those super delegates that Bernie is by far the strongest candidate against Donald Trump,” Briggs said in a statement

But the AP said Mrs Clinton reached the threshold with a big win in Puerto-Rico and a burst of last-minute support from super delegates.

Clinton has 1,812 pledged delegates won in primaries and caucuses, and Sanders has 1,521. She also has the support of 571 super delegates, according to an AP count, compared to 48 for Sanders.

Clinton, Sanders In Angry Combative Debate

Bernie SandersDemocratic front-runner Hillary Clinton and rival Bernie Sanders challenged each other’s judgment and experience in a combative U.S. presidential debate ahead of Tuesday’s crucial nominating contest in New York.

Clinton and Sanders attacked each other over Wall Street, gun control and other issues on Thursday in a series of exchanges that laid bare the mounting pressures on them both but seemed unlikely to change the dynamics of the race, Reuters reports.

While far short of the brawls that have characterised Republican debates, the tone reflected a contentious turn in the Democratic contest.

Clinton and Sanders out-shouted each other while a split crowd roared its approval.

“If you’re both screaming at each other, the viewers won’t be able to hear either of you,” moderator Wolf Blitzer of CNN warned during the debate at the historic Navy Yard in the New York borough of Brooklyn.

As the two-hour debate ended, social media analyst Brandwatch said Sanders had more than 173,000 mentions on Twitter, 55 per cent of them positive, while Clinton had more than 191,000 mentions, 54 percent of them negative.

Clinton mentions were more negative than positive in two out of the three previous debates.

Sanders, 74, will take a quick break from the campaign trail on Friday to fly to the Vatican, where he will give a brief speech at a conference on the world economy and social justice.

Sanders, who will be back in New York to campaign on Sunday, has said the trip is not a political appeal for the Catholic vote but a testament to his admiration for Pope Francis.

U.S. Democratic Candidates Debate Gun Control, Healthcare Policies

SandersUS democratic presidential contenders, Bernie Sanders and Hillary Clinton have clashed on gun control and healthcare in a live television debate.

Clinton raised questions about the self-styled democratic socialist’s positions on Wall Street reform, healthcare and gun control.

Sanders pushed back painting Clinton as a defender of the status quo who accepted hundreds of thousands of dollars in speaking fees as a former secretary of state from Wall Street backers.

“I don’t take money from big banks. I don’t get personal speaking fees from Goldman Sachs,” the U.S. senator from Vermont said, adding, “I have huge doubts when people receive money from Wall Street.”

Clinton accused Sanders of voting to deregulate the financial market in 2000 in a way that led to the central causes of the financial collapse of 2008 that pitched the U.S. economy into a deep recession.

Clinton tried to undercut Sanders’ support among supporters of Obama, who remains a popular figure in the Democratic Party.

“He’s criticized President Obama for taking donations from Wall Street. And President Obama has led our country out of the Great Recession,” she said.

“Senator Sanders called him weak, disappointing, he even in 2011 publicly sought someone to run in a primary against President Obama.”

Before the debate in South Carolina, Mr Sanders unveiled a healthcare plan for all American citizens.

Mr Sanders’ universal healthcare plan, announced two hours before the debate started, would see citizens pay what he called “a 2.2% income-based premium”.

Towards healthcare, companies would pay an extra 6.2% of an employee’s income towards the plan.

But Mrs Clinton attacked him saying the move risks derailing healthcare legislation introduced under President Obama.

The debate was held across the street from the Charleston church where a white gunman killed nine black worshippers in June, and Clinton made reference to the incident while accusing Sanders of being weak on gun control.

She welcomed his decision on Saturday night to back a bill in Congress rescinding portions of a law giving gunmakers immunity from lawsuits, but said his record showed a more lenient attitude toward the demands of the powerful National Rifle Association (NRA) gun lobby.

Sanders defended himself, saying he has a strong record on trying to prevent guns from getting into the wrong hands and standing up to the NRA.

While Hillary Clinton leads the polls nationwide, she is facing a threat from Vermont senator Bernie Sanders in key states.

Sanders cast himself as the outsider who would lead a political revolution, while Clinton touted her experience and embraced President Barack Obama’s legacy.

This was the final democratic debate before Iowa caucuses launch the nominating race on February 1.

The debate followed a week of rising tension between the two leading candidates.