News You Can Use From Phil’s Stock World

Financial Markets and Economy

Global stocks recover despite China downgrade; Fed minutes due (Reuters)

World stock markets recovered on Wednesday from initial losses after Moody's first credit downgrade of China in 30 years, with investors turning their attention to U.S. Federal Reserve minutes that could provide more certainty of a rate hike next month.

Goldman Sees OPEC Cut Dwarfing U.S. Oil Sale If It Occurs at All (Bloomberg)

OPEC can rest easy even on the off chance that Donald Trump’s plan to sell U.S. oil reserves comes to fruition, according to Goldman Sachs Group Inc.

ECB Warns of Dangers of `Ripple Effect' From House Price Boom (Bloomberg)

The European Central Bank warned there may be “excessive exuberance” in some European housing markets, driven in part by foreign buyers, that could spread to other areas in a “ripple effect.”

A Few Big Stocks Don't Tell the Whole Market Story (Bloomberg)

Investors are becoming increasingly worried that a few stocks seem to be driving the returns in the S&P 500 this year. Apple is up more than 33 percent in 2017. Facebook and Amazon shares are both up around 28 percent. 

Bidding Wars Turn to Homebuyers’ Remorse in Toronto (Bloomberg)

After a double whammy of government intervention and the near-collapse of Home Capital Group Inc., sellers are rushing to list their homes to avoid missing out on the recent price gains.

The rise of bitcoin, ethereum, and other cryptocurrencies shows just how weird markets are right now (Business Insider)

The market capitalization of Ethereum, the second largest “cryptocurrency,” has soared 88% in a week, from $8.4 billion, when I pooh-poohed it  on May 15, to $15.8 billion at the moment. 

Algos could trigger the next stock market crash (Wolf Street)

Quant-focused hedge funds – they specialize in algorithmic rather than human trading – gained $4.6 billion of net new assets in the first quarter, and now hold $932 billion, or about 30% to the $3.1 trillion in total hedge-fund assets. 

How Overvalued Is The S&P 500? (Jonathan Weber, Seeking Alpha)

The S&P 500 (NYSEARCA:SPY) index, the most widely used index to gauge the strength as well as the overall valuation of the US stock market, has been hitting a couple of new highs over the last year. According to many metrics the index could be overvalued, or is, at least, trading at a premium relative to how the index was valued in the past.

Another Rate Hike Will Put The Nail In The Housing Coffin (Eric Basmajian, Seeking Alpha)

New Home sales, a monthly report published by the Census Bureau, was released Tuesday morning. New Home Sales measures the number of newly constructed homes with a committed sale during the month.

How Much Money Stock Day Traders Make (The Balance)

Whether it's for lifestyle, thrill seeking or the challenge of it, the question of how much money stock market day traders make inevitably arises. How much stock day traders make will vary drastically, with some day traders losing their capital, and others utilizing their capital to produce a high monthly income.

2017-Q2's Dividend Cuts Suggest Return Of Recessionary Conditions (Ironman at Political Calculations, Seeking Alpha)

Although you wouldn't know it from the just completed earnings season for 2017-Q2, the number of dividend cuts announced to date in the current quarter indicate that recessionary conditions have returned in May 2017 after largely having been on hold in April 2017.

There Is One Big Problem With The Trump Budget (Zero Hedge)

On Tuesday, the White House revealed its proposed 2018 budget, which as discussed earlier, anticipates some draconian cuts to government spending amounting to a massive $3.6 trillion over the next 10 years.

Technically Speaking: Bulls Struggle With Bearish Internals (Real Investment Advise)

In this past weekend’s newsletter, I discussed the fact that despite the bullish “exuberance” of market participants, the underlying internal deterioration has continued.

Yuan Tumbles As Moody's Downgrades China To A1, Warns On Worsening Debt Outlook (Zero Hedge)

Offshore Yuan tumbled as Moody's cut China's credit rating to A1 from Aa3, saying that the outlook for the country’s financial strength will worsen, with debt rising and economic growth slowing. This leaves the world's hoped-for reflation engine rated below Estonia, Qatar, and South Korea and on par with Slovakia and Japan.

Why China's Strategic Petroleum Reserve Is All That Matters For OPEC (Zero Hedge)

When OPEC sits down on Thursday, keeping the price of Brent above $50 (to avoid a budget catastrophe and social upheaval in Saudi Arabia) and below $60 (to prevent US production from going exponential), will be just one problem the cartel nations and various hangers-on will be desperate to solve.

Companies

The EU is working on a new law to force Facebook and YouTube to take down hate speech (Reuters)

European Union ministers approved plans on Tuesday to make social media companies such as Facebook, Twitter and Google's YouTube tackle hate speech on their platforms, the first legislation at EU level on the issue.

Australian who runs $37 billion investment fund calls Uber a 'ponzi scheme,' claims it'll be broke in a decade (Business Insider Australia)

A cofounder of the Magellan Financial Group, which manages more than $37 billion, thinks the ride-hailing service Uber has a less than 1% chance of surviving the next decade.

Amazon is starting to experience the headache of having an airline (Quartz)

Pilots for Amazon’s new cargo air service are planning to picket outside the retail giant’s annual meeting in Seattle May 23, demanding higher pay.

The Rise of the Fat Start-Up (NY Times)

In 2003, Keith Rabois, a longtime Silicon Valley investor and executive, had an ambitious idea: He wanted to start a website that would instantly offer a fair price for your home. If you accepted the offer, the site would agree to buy your house immediately, closing the deal in a matter of days.

Technology

Ikea’s smart light bulbs will work with Amazon Alexa, Apple Siri and Google Assistant (Tech Crunch)

Ikea’s smart light bulbs will answer to voice commands starting this summer. The company announced in a Swedish-language press release that its smart lighting product line, called Trådfri, will work with Amazon Alexa, Google Assistant, and Apple Siri and HomeKit.

Google's $5,000 4K digital whiteboard goes on sale (Engadget)

It only took half a year, but Google's first take on a digital whiteboard is finally available. Google has started selling the Jamboard in the US for $4,999 plus $600 per year for management and support ($300 if you buy one by the end of September).

?Researchers find 'smoking gun' in VW emissions cheat code (RoadShow)

It took them a year, but researchers have finally found the mechanism that Volkswagen used to cheat emissions tests, buried in lines of code published on the company's own website.

India's electric vehicles push likely to benefit Chinese car makers (Reuters)

India's ambitious plan to push electric vehicles at the expense of other technologies could benefit Chinese car makers seeking to enter the market, but is worrying established automakers in the country who have so far focused on making hybrid models.

World’s Biggest Aircraft Nails Critical Test Flight (NBC News)

A massive airship dubbed the Airlander 10 recently completed a successful test flight, bringing the helium-filled behemoth one step closer to commercial use.

One of the greatest chess players of all time, Garry Kasparov, talks about artificial intelligence and the interplay between machine learning and humans (Business Insider)

Most of the things we mention we understand. You know, if we say "white," we all see it's white. If we talk about elements of computer science or some general items, we are in agreement. There’s no need to go into definition.

Politics

Republicans Will Reject Trump’s Budget, but Still Try to Impose Austerity (NY Times)

Finally some good news for President Trump: His new budget stands absolutely no chance of being enacted by Congress.

Trump Praises Duterte for Philippine Drug Crackdown in Call Transcript (NY Times)

President Trump praised President Rodrigo Duterte of the Philippines in a phone call last month for doing an “unbelievable job on the drug problem” in the island nation where the government has sanctioned gunning down suspects in the streets.

Trump retains outside lawyer Marc Kasowitz to help with Russia investigations (The Washington Post)

President Trump has retained the services of a trusted lawyer, Marc E. Kasowitz, to help him navigate the investigations into his campaign and suspected Russian interference in last year’s election, according to people familiar with the decision.

Public Trust in Government Remains Near Historic Lows as Partisan Attitudes Shift (Pew Research Center)

The 2016 election ushered in a new era in Washington defined by unified Republican control of the White House and both chambers of Congress. The changes in the dynamics of power in Washington have registered with members of both political parties.

Health and Biotech

Cuts to AIDS Treatment Programs Could Cost a Million Lives (NY Times)

At least one million people will die in sub-Saharan Africa and elsewhere, researchers and advocates said on Tuesday, if funding cuts proposed by the Trump administration to global public health programs are enacted.

Life on the Home Planet

Greenpeace Shines Message For Trump On Vatican Before His Visit With The Pope (The Huffington Post)

The dome of St. Peter’s Basilica was cast in a remonstration early Wednesday aimed at President Donald Trump just hours before his visit to the Vatican.

Massive Rockslide Buries Stretch of California’s Highway 1 (NBC News)

A major new rockslide has buried a stretch of California's iconic Highway 1 in up to 40 feet of stone and dirt, the latest hit in a soggy winter of slides, floods and road closings along the winding Central California coast road, state transportation officials said Monday.

New Jersey Town Used Zoning to Discriminate Against Islam (NY Times)

This is the chronicle of how a founding principle of this country, the freedom to worship, crashed into a public bureaucracy in the venerable and prosperous New Jersey suburb of Bernards Township.

Do Doctors Get Worse as They Get Older? (Harvard Business Review)

A debate has erupted within medicine over how to ensure that physicians maintain their clinical skills throughout their careers. The American Board of Internal Medicine (ABIM) has long required internists to pass Maintenance of Certification exams every 10 years to keep their board-certified status.

Venezuela is sliding into anarchy (The Washington Post)

Venezuela’s crisis has taken a dark turn in the past few days.

Rioting and looting have exploded in the rural state of Barinas, leaving eight dead and dozens injured. In one of Caracas's main plazas on Saturday, a lynch mob doused a young man with gasoline and set him ablaze. 

9 Ways Organizations Sabotage Their Own Security: Lessons from the Verizon DBIR (Dark Reading)

Datasets from the recent Verizon 2017 Data Breach Investigations Report (DBIR) show that some security teams still may be operating under false assumptions regarding what it takes to keep their organizations secure.