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Tumblin’ Tuesday – They Will PAY You to Take Their Oil

$38.50 per barrel.  

That's how much you get PAID at the NYMEX for agreeing to take a 1,000-barrel contract off their hands.  The problem is (and the reason it's so cheap) what are you going to do with 1,000 barrels of oil and $38,500?  The barrels are 42-gallon drums and weigh 300 pounds each and you have to pick them up in Cushing, OK no later than the end of the next month and picking up means from a pipeline – you have to bring your own barrels.

You can buy the barrels for about $20 each but they are 3 foot tall by 2 foot in diameter (12 cubic feet) and a standard semi truck has about 2,400 cubic feet of spaces so, if you were to fill up 1,000 barrels you'd need 5 semi trucks to take them to your storage facility and you'd have to pay 5 teams to load them and unload them and then pay for storage until you find a seller.

No fuel price reduction yet, despite 20% price drop in crude oil ...Still if you are doing the math, you might be able to make all that work for under $38,500 but then you still need to find someone who will buy the oil from you for less than zero and, while -$38.50 did not last long – oil is still trading at -$4 this morning.  Those are the contracts that expire today for May delivery as there is simply nowhere left to put the oil.  

Not only are the storage facilities full but the pipelines are full so you can't even transport the stuff and the oil tankers are being used for storage and good luck finding a tanker truck or tanker car on a train.  Go to your local gas station and he'll tell you he's full too – those tanks hold 12,000-24,000 gallons and that's just 250-500 barrels at a gas station but that is, of course, refined gasoline – you would be buying unrefined crude so your only potential buyer is a refinery and, guess what – they're FULL!!!

So the oil market is, currently, broken and will not magically get unbroken as long as no one is driving their cars.  Trump is talking about adding 75M barrels to the Strategic Petroleum Reserve and he should have done that yesterday, when he could have been PAID $2.88Bn to take it!  

75M barrels is 75,000 contracts and that's about all the storage that's left in America and that's a BIG problem for NYMEX traders, who place hundreds of thousands of fake, Fake, FAKE! orders – something we've discussed since oil was $100 per barrel, 13 years ago (see "Goldman’s Global Oil Scam Passes the 50 Madoff Mark!").  Well now the scam completely unravels as there is no longer anwhere to hide the fake orders and they can no longer be rolled but there are still 582,426 open contracts at the NYMEX, pretending they want delivery of 582 MILLION barrels by June 30th.  WTF are they going to do with those?

Click for
Chart
Current Session Prior Day Opt's
Open High Low Last Time Set Chg Vol Set Op Int
Cash - 18.12 18.12 18.12 18:00
Apr 20


18.12s*
-1.75


-
18.12


-
n/a
May'20 -14.00 2.54 -16.74 -5.15 07:29
Apr 21


-
32.48 3642 -37.63 15702 Call Put
Jun'20 21.32 22.58 11.79 15.55 07:29
Apr 21


-
-4.88 682504 20.43 582426 Call Put
Jul'20 27.18 28.14 19.80 23.10 07:29
Apr 21


-
-3.18 106750 26.28 367138 Call Put
Aug'20 28.85 30.08 22.30 25.58 07:29
Apr 21


-
-2.93 50458 28.51 149175 Call Put
Sep'20 30.01 31.10 23.64 27.06 07:29
Apr 21


-
-2.78 50075 29.84 163167 Call Put
Oct'20 30.94 32.00 24.88 28.13 07:27
Apr 21


-
-2.68 33389 30.81 101204 Call Put
Nov'20 31.90 32.60 26.05 29.17 07:27
Apr 21


-
-2.49 23075 31.66 87805 Call Put
Dec'20 32.42 33.47 27.17 30.20 07:29
Apr 21


-
-2.21 58325 32.41 297665 Call Put

We thought oil was going to bounce and we took some longs on USO for July and some June contracts but we gave up yesterday as the volatility got too crazy and now, looking at these open orders – I don't see how the June contracts are going to escape the same fate as the May ones just suffered.  75M barrels won't put a dent in those fake orders.  I suppose the NYMEX could declare a force majeure and cancel all contracts but, short of that – this is likely to be an ongoing catastrophe.

Fortunately, the energy sector is down to about 3.5% of the S&P 500 already so it can continue to collapse without taking the whole market with it but, unfortunately, it will constrain growth on the way back as capacity goes permanently off-line through bankruptcy and lack of investment in new wells as the old ones run dry.  In the future – assuming demand returns – there will be spot shortages for years to come.

None of that matters now though – the reality of the now is that every barrel of oil pumped out of the ground above our anemic 8.5Mb consumption (and that INCLUDES 3.5Mbd we refine for export) adds to the problems of a country that is already swimming in oil.  The US passes Saudi Arabia last year to become the World's Largest producer of oil and the Republicans have been running on a "Drill Baby Drill" platform since McCain in 2008 and now they have succeeded – yet another Conservative plan that ended up destroying a US Industry.  

Not only do reckless policy decisions destroy the long-term viablitiy of industries but the fossile fuel industry and their pollution is killing us slowly (with environmental damage and global warming) and now quickly as air pollution causes much higher death rates from Covid-19.  Who could have thought that the long-term damage to our lungs due to air pollution would make them vulnerable to disease?  It's one of those connections our President would say no one ever could have seen coming – so clearly not his fault...

Mercury In Your Home: Health EffectsTrump is, of course, hard at work – rolling back air quality controls and increasing the amount of mercury, arsenic and other heavy metals the Koch Brothers' plants can spew out into the atmosphere.  The EPA’s own in-house experts believe that the rules Trump’s team has gutted were saving 11,000 premature deaths per year - more bodies for the pile, I suppose…

Rolling back the regulations has allowed Trump to roll in the donations from our nation's largest polluters and they will keep paying as they need Trump to have 4 more years to poison the atmosphere.  The President is $189M ahead of Joe Biden, who can't campaign and is ignored by the media in the midst of the 2020 Presidential campaign.  Nonetheless, Biden is well ahead in the polls because that's how terrible Trump is… 

There will be more pressure on the May oil contact (/CLK20) as it terminates today at 2:35 and that should keep pressure on the June contract (/CLM20), which is currently $14.  Trump will officially announce filling the SPR at some point but not today as he needs Congressional approval – though that hasn't stopped him from announcing things he can't really do before.  

This morning's low on /CLM20 was $11.79 so I don't mind taking a poke there with a stop at $11.50 and then again at $10 with a stop at $9.75 but only playing for bounces because, as noted above, the contract pressure in June is tremendous.  

Be careful out there. 

 


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  1. /CL/Phil- Did you close june contracts?


  2. Phil/Oil

    Good Morning!

    so would it make sense to short the June contracts?


  3. Another question, how about going long USO calls with a 2022 spread? Can keep selling premium against it until this sorts itself out?  Stupid idea??


  4. Still not ready to go long!


  5. I wonder how long it will take before gas station pay us to take their gas… I have not filled up my car in over a month now.

    On the other hand, now might be a good time to raise the gas tax and impose other carbon taxes. I guess the bullish case for oil and that was the entire game from MBS and Putin (good friends of the USA) is that the entire shale industry in the US goes out of business and production will come down naturally. The hope will be then that even as prices go up, no one will want to touch that shale oil again and risk another price war with Saudi Arabia and Russia.


  6. Good morning!

    /CL/Ravi – Yes, I said yesterday I was looking for a bounce to get 1/2 out and we got that and then I added on the big dip and got the rest out with a small loss – happy to be done with it.  As I told Tangled yesterday – it's just not playable the way it's going though I am willing to get in at about $12 with a tight stop and $10 with a tight stop in case OPEC or Trump announce something to bounce us. 

    Fortunately we had that /NG pop and now /RB is back at 0.55 and I would rather play that than /CL but they are all death traps at the moment.

    /YM 23,000 is roughly the -2.5% line so worth playing for a bounce with tight stops below – if it gets back over.   /NQ 8,600 also good and /ES 2,750 is good and watch 1,170 on /RTY to confirm.

    Shorting/Maya – It does make sense but it's so dangerous I don't recommend.  

    USO/Jeff – Same thing, makes perfect sense but so dangerous.  I will decide on our STP play soon.

    Big Chart – Now we have to hold those 20 dmas (if we fall that far).  Other than that – we're just consolidating in our expected channel – yawn…

    Gas/StJ – MPG = Months per Gallon now.  


  7. MPG / Phil – I am getting 1.5 MPG from my SUV now! 


  8. Nas taking a dive, loving our SQQQ's!  


  9. Good Morning.


  10. uso trading halted


  11. The problem with trading oil (and other stuff BTW) is that we are only one POTUS tweet away from a $10 move in any direction. Trump could tweet that he spoke to the DoD about using oil storage in military bases and the \CL contract goes up $10. It won't matter that it's true, people will latch on to any BS. Of course, Trump's buddy have probably been making bank of these sort of tweet.





  12. Coke volume plunges 25% in April; hopes for 2nd half rebound



  13. Hi Phil,

    New user here and looking at the SDS call options, Jan 15'21 and seeing that the open interest is very low, only in the hundreds of contracts.  Is my trading platform lying to me?  If not, wouldn't the liquidity become a serious issue?  Hope this is not too-stupid of a question!  Thanks!!!


  14. carbon worth more in the ground. Another consequence of the emerging knowledge economy.


  15. MIDD / Phil

    On 2nd March you wrote… "We have a pretty conservative spread and there are no longer options to roll to so I'm not inclined to make a move yet but, if we can buy back the short calls for less than $5 (up 50%), that's something we might do and wait for a bounce to sell more."

    The MIDD short calls can be bought back for .10c. Would now be a good time to Double down and make an adjustment?


  16. USO/Tommy – Maybe a reverse-split.

    Good point, StJ – That's why it's essentially untradeable. 

    Welcome Don!    Long options on ultra-ETFs tend not to be very liquid but, as long as you don't plan on day-trading it – it's not a big deal.  These are insurance policies, not trades but, if it makes you feel better, SDS is at $25 and $40 is 40% higher so we're protecting against a 20% drop in the S&P and SPY is at $276 so 0.8 x that is $220 so how do we make $100,000 on SPY at $220?  The Jan $220 puts are $14 and the $240 puts are $19 and the $260 puts are $25 and the $280 puts are $33.50 so I don't want to pay $8.50 for a $20 spread so net $6 for the $260/240 or net $5 for the $240/220 and I'd certainly pay an extra $1 to be $10 higher so $260/240 it is for net $25,000 for 50 of those.

    Still we can do better so we can sell May $250 puts for $4.50 and we can sell 30 of them for $13,500 and we can use that $13,500 ($2.70 per put spread) to roll our Jan $260 puts ($25) to the $270 puts ($29) so now we have 50 Jan $270/240 bear put spreads that pay $150,000 that we paid net $56,500 for but we have more months to sell so we can lower the basis or, if SPY drops and the May puts go in the money, the July $200 puts are $3.60 so that's our roll target (don't let it get away) and below $250 we would add another layer of long put spreads to pay us another $100,000 below $200.

    SPY bottomed out a $220 so hopefully that holds if we have another dip.  Clearly it's around the spot where Congress and the Fed step in to throw money at the problem.

    MIDD/Youngy – Our LTP play on MIDD looks like this:

    MIDD Long Call 2020 18-DEC 100.00 CALL [MIDD @ $48.53 $-0.03] 10 1/23/2020 (241) $17,700 $17.70 $-17.23 $64.20     $0.48 - $-17,225 -97.3% $475
    MIDD Short Put 2020 18-DEC 75.00 PUT [MIDD @ $48.53 $-0.03] -20 3/23/2020 (241) $-66,000 $33.00 $-3.95     $29.05 - $7,900 12.0% $-58,100
    MIDD Long Call 2020 18-DEC 30.00 CALL [MIDD @ $48.53 $-0.03] 20 3/24/2020 (241) $40,740 $20.37 $1.18     $21.55 $-1.55 $2,360 5.8% $43,100
    MIDD Short Call 2020 18-DEC 50.00 CALL [MIDD @ $48.53 $-0.03] -20 3/24/2020 (241) $-16,220 $8.11 $1.29     $9.40 $-0.85 $-2,580 -15.9% $-18,800

    On Friday I said this:

    MIDD – I'm very confident in this one coming back over time and the new spread is conservative. 

    Those Dec calls are LONG calls, not short calls – left over from our original spread in case they get lucky as there's no point in cashing them in for 0.10.

    As to doubling down – we did – that's how we have the $30/50 spread and MIDD is at $48 so it's "on track" to pay $40,000 and is currently a net $33,325 credit (because we stuck with the very high puts that are still questionable) but, if all goes well and MIDD goes back over $75 or we find some way to get the rolled puts to expire worthless, then we will make $73,325 from this trade.  

    I doubt we get to $75 in this short time-frame but I do believe we'll get $40,000 for the bull spread and then we'll just roll the short puts along until we don't have to pay them back and – WINNER!  

    In the meantime, we don't have unlimited buying power so we don't waste it fixing things that don't need to be fixed.  


  17. MIDD / Phil

    Thank you. I missed the adjustment. It looks like it's still not too late to make the changes. Thanks


  18. There is a fundamental misunderstanding as to what's really going on. For example:

    If the knowledge economy can produce energy for free, why would oil have value?

    Isn't that really the Occam's Razor here? I'm mystified that people are mystified.


  19. CYCC that's a stomach0churning 5-day chart.

    WATT: it's my second favorite scam stock (after ETHE). "Charge your phone by leaving the microwave door open while it's running" caught some a bid on news today. Hooray for scams!


  20. If Kim Jong Un dies will Trump take credit?  


  21. the situation you guys have in Georgia reminds me of the jaws movie I wonder if the governors kids will be the first in the water


  22. I am in Augusta and it's just astounding that he came out with this.  The blatant irresponsibility and disregard, when we have Governors like Cuomo and Beshear handling this crisis exponentially better, is inexcusable.   He literally had a press conference last week where he admitted that Georgia was "behind the curve", standing 6 feet away from the others at the press briefing, which was held outside, and refusing to talk about when Georgia would reopen, instead focusing on the present and not having enough testing.  Now, less than a week later, we are about to surpass 20,000 cases, and in my county (Columbia), there is doubt that the numbers are being counted correctly and there was a report that there exists thousands more actual positive cases than what is reported.  

    Places like Tybee Island have said no way, we are not opening up and playing with people's lives, as has Hilton Head in South Carolina, where we have a condo.  

    This whole thing is a complete government debacle.  We might as well be 50 different countries.


  23. MIDD/Youngy – See you are learning then, your instincts to DD from 10 were correct.  

    Energy for free/BDC – Well we're not there yet but one day.  

    The Matrix: Using humans as a power source wouldn't work in the ...

    How about if we put the phone IN the microwave, BDC?  It could work!!!

    It could WORK! - young frankenstein | Meme Generator

    Georgia/Tommy – As long as they watch where they step:

    Greater than 200 cases per 100,000 is 1/500 around Atlanta and the Governor wants them to go out and mingle.   

    COVID-19 Confirmed Cases: No. Cases (%)
    Total 19881 (100%)
    Hospitalized 3779 (19.01%)
    Deaths 799 (4.02%)





     

    COVID-19 Confirmed Cases By County: No. Cases No. Deaths
    Fulton 2208 82
    Dekalb 1534 29
    Dougherty 1446 103
    Gwinnett 1222 42
    Cobb 1215 59

    I don't see Augusta listed, Rperi.


  24. tangledweb

     

    Yes he will


  25. Short-Term Portfolio (STP) Review:  Yes, we have to do them every other day in a crisis…   STP at $550,796 and LTP flat so $1,050,000 is holding up pretty even in this little dip – BALANCE!  That TSLA trade is working too.

    • CANE – Frustrating as it's back flat.
    • AAPL – Not worried 
    • JPM – Not worried.  

    • SDS – $60,000 in the money and it's a $200,000 spread, not a $100,000 spread.  We bought it for $28,500 so I'd say it's a good deal, now $50,000 so $150,000 upside potential. 
    • SQQQ #1 – Short-term protection on this one and it's a $120,000 spread currently net $33,075 so $85,000 upside potential.  
    • SQQQ #2 – $46,515 in the money at net $33,075 and it's a $105,000 spread at $25 so $71,925 upside potential.  
    • TSLA – On track.  Both $800 puts losing about the same but the June premium only has 59 days left while the 2021s have 269 days so we should have some kind of premium left in those when the Junes run dry at whatever price.  Since the spread was net $3,384 and the Jan $800 puts are currently $49,710 – I think we'll be very happy with any finish below $800.

    • UNG – Surprisingly on track.  

    • USO – July is not going to happen and they are likely to reverse-split this ETF at this rate.   Still, we only paid net $2.10 for the spread and the July $3s are $1 and the 2022 $1 ($2.05)/$4 ($21.10) bull call spread is down to 0.90 so let's roll to 200 of those as it's the same width but a lower strike and we'll leave the puts but we will buy back the short calls because what a nightmare if USO popped and we had to pay them – not worth saving $2,000 over that risk.  It's a gamble and we're down $15,000 and spending $10,000 more but it's a $60,000 spread so all will be well if USO gets back to $4 one day. 


  26. Oh, that's $300,000 of downside protection by the way (the longs are hedges of the hedges so they don't count) so as long as we don't see an alarming bleed in the LTP – we're good.  

    Of course, I don't consider going from $1,102,871 on Friday to $1,050,000 this afternoon alarming – keep that in mind….

    That's because we know the STP is slow to respond to changes (because we have bull call spreads) while the LTP suffers quickly from a rising VIX so we take our portfolio balances with a grain of salt.  

    Also, in a volatile market, the bid/ask spreads tend to widen and our brokers give us the worst-case scenario for each spread so we can usually do a lot better than that in reality.  

    All that stuff is great in theory but that means you have to have PLENTY of margin on the sides so you can ignore your broker's opinion of the value of your positions during a downturn.  Cash on the side is one of the most valuable forms of insurance you can have.  



  27. Now the rollover from /CLK20 ($7.68) to /CLM20 ($11.48) is less than $4.  Not many people could have ridden that out though.

    Now WE are being cut off:

    • Due to the pandemic, Air Canada (OTCQX:ACDVF) says it will suspend flights between Canada and the U.S. after April 26.
    • The Canadian carrier plans to resume service to the U.S. on May 22.
    • Air Canada has been operating some cargo-only flights over the last few weeks.
    • Canada has seen fewer deaths per capita related to COVID-19 than the U.S. and major European nations, which could see it return to a normal pace of business activity quicker.

    How long before we obtain "Rogue Nation" status?  

     

    • A new big-movie delay comes as Sony (SNE -2.5%postpones the sequel to its 2018 hit Venom.
    • Venom: Let There Be Carnage will now debut June 25, 2021, a pushback from its original scheduled opening of Oct. 2, 2020.
    • The first film drew $856M in worldwide grosses, with $642.6M of that coming outside North America. It opened domestically to a strong $80.3M in October 2018.
    • House Minority Leader Kevin McCarthy and Senate Minority Leader Chuck Schumer confirm that the White House and Congress have reached an agreement on replenishing the small-business payroll loan program and providing aid for COVID-19 testing and hospitals.
    • The Senate is expected to pass the package Tuesday afternoon. If that occurs, the House vote could take place as early as Thursday.
    • Update at 1:22 PM ET: President Trump, via Twitter, urges the Senate and House to pass the Paycheck Protection Program and Health Care Enhancement Act.
    • After signing the bill, Trump intends to start talks to tackle relief for states and local governments; infrastructure investment; tax incentives for restaurants entertainment, and sports; and payroll tax cuts, he said.
    • Previously: Senate may vote on SBA loan program tomorrow: coronavirus briefing (April 20)
    • BTIG starts off coverage on Shake Shack (SHAK -1.1%) with a Neutral rating on concerns over sales trends, new unit returns and persistent margin pressure amid the pandemic.
    • "We recognize that shares and investor sentiment are close to recent lows, but so are comparable sales and EBITDA growth trends, and we struggle to envision how the company can return to its prior form amid the current environment," warns analyst Peter Saleh.
    • Saleh also points out that SHAK could trade at a more modest valuation multiple if management slows the pace of new unit growth. The vibrant growth story at Shake Shack has led to a frothy earnings multiple over the last few years.
    • On YTD return comparison, Shake Shack ranks 16th out of 51 publicly-traded stocks. Shares are 57% off their 52-week high.
    • Barry Sternlicht, founder of Starwood Hotels and Starwood Property Trust (STWD -1.6%), said he's working with other property executives to develop "best practices" for re-opening hotels and retail stores at the request of the White House.
    • Such protocols would include deep cleaning and possibly temperature checks at the entrances to hotels and stores, he said. Having guests or customers sign waivers is another possibility, he added.
    • He emphasizes the importance of restarting the economy. "We have to get going," he said on CNBC. "The cost is too great. The government can't carry a $23T economy."
    • He's still bullish that the economy will rebound once businesses re-open but can't specify how fast that will occur.
    • “What does the slope look like? It depends on how we reopen the economy,” he said.
    • The Texas Railroad Commission defers a decision on whether to mandate production cutbacks in the state and will revisit the issue on May 5.
    • The regulator instead is forming a task force with an aim to research what can be done to help the industry, TRRC Chairman Wayne Christian says.
    • The debate on whether to cut production was in response to a proposal by shale drillers Pioneer Natural Resources (PXD -2%) and Parsley Energy (PE -1.1%).
    • Commissioner Ryan Sitton reiterated his desire to require output cuts of 20%, or ~1M bbl/day, from late-2019 production levels if other states or countries agree to cut an additional 4M bbl/day.
    • But Christian and one other commissioner on the three-member panel said the TRRC must make sure that any ruling fits legal requirements and does not get stuck in court.

    Energous (NASDAQ:WATT+215%.

    • Industry groups, including the U.S. Chamber of Commerce and National Association of Manufacturers, hope to get temporary, legal and regulatory safe harbor legislation to limit liabilities to businesses that follow official health guidelines in re-opening the economy.
    • In other words, Corporate America wants to make sure it's not held responsible for policy decisions by government authorities if employees or customers become infected with COVID-19 after businesses re-open.
    • Also, they want to be shielded from litigation that could result from virus-related disruptions to issues such as hours, leave, wages, and travel.
    • In yesterday's White House coronavirus task force briefing, President Trump said he was in favor of the idea of waiving liability for businesses that re-open after lockdowns ease.
    • Hyatt Hotels (H -2.6%reports Q1 revenue to be in the range of $980M to $1B vs. consensus of $1.05B and system-wide RevPAR declines of 28%.
    • The company withdrew FY2020 outlook due to COVID-19 impact.
    • The company expects to report cash and cash equivalents of ~$1.2B as of March 31, 2020.
    • To preserve cash, the company reduced adjusted capex by ~$125M for FY2020, reduced corporate SG&A expenses through furloughs and salary reductions, as well as eliminated all non-essential spending, which represents a reduction of ~40% in current monthly operating cost.
    • Citing recent checks, Nomura continues to believe Apple's (NASDAQ:AAPL) iPhone 12 "is running four to six weeks behind plan."
    • Jeffrey Kvaal thinks Apple has cut its Q3 iPhone 11 SE orders from around 46M to near Nomura's 37M estimate.
    • The analyst says the move modestly reduces Apple's CY20 build plans and provides "wiggle room" should the 5G models run behind schedule.
    • Nomura maintains a Neutral rating and $240 price target on Apple.
    • Related: Earlier today, NAR sources said Apple wanted to boost its iPhone production rate through next March by 4%, split evenly between the SE and 5G models.
    • In other AAPL news, the tech giant announces that its Services are now available in 20 more countries. The offerings include the App Store, Apple Arcade, and iCloud.
    • Apple Music adds 52 additional countries.
    • The California Public Utilities Commission has asked PG&E (PCG -7.1%) for governance and oversight changes in its reorganization plan, while a CPUC member proposes $1.9B in penalties for its role in causing the 2017-18 wildfires in the state.
    • The CPUC proposal "will require PG&E to modify its governance structure, submit to an enhanced oversight and enforcement process if it fails to improve safety, and create local operating regions."
    • Both proposals will be put to vote next month, CPUC says.
    • The company needs to exit bankruptcy by June 30 to participate in a state-backed wildfire fund that would help reduce the threat to utilities from wildfires.
    • CFRA keeps a Sell rating on Las Vegas Sands (NYSE:LVS) ahead of the casino operator's earnings report tomorrow.
    • Analyst Tuna Amobi says the results will likely be buffeted by the COVID-19 disruption given the limited operating duration of its casinos/resorts in Macao/China and Singapore as well as ongoing temporary closures of its U.S. casinos.
    • "We note gross gaming revenues in Macao/China plunged almost 88% and 80% in February and March (after an 11% decline in January), respectively, with continued challenges likely ahead of an eventual market recovery. Meanwhile, aiming to conserve its liquidity, LVS suspended its dividend last week, with buybacks under a $2B plan also seen as unlikely in the near term. In addition, LVS said Sands China (its 70%-owned subsidiary) suspended its final dividend for '19. Still, LVS reaffirmed its capital expansion plans for Macao and Singapore, with plans to spend $5B+ on incremental investments in Asia."
    • Heading into the print, shares of Las Vegas Sands are down 14% over the last week and are off 40% YTD.
    • Tanker stocks including North American Tankers (NAT +11.7%) and Teekay Corp. (TK +6.9%) continue their climb higher, as the oil supply glut and lack of coordinated efforts to slow the flow of crude have helped fuel one of the strongest-ever crude tanker markets.
    • Benchmark Middle East-China tanker rates surge 24% to WS 196.04, and other major VLCC rates also advanced, including those for routes from the Middle East to the U.S. Gulf and to Singapore, according to Baltic Exchange data.
    • The shipping spot market "is going to stratospheric levels," Euronav (EURN -0.7%) CEO Hugo de Stoop tells Bloomberg. "We think it will go higher and higher, simply because there are more and more ships which are being taken out of the fleet for storage purposes."
    • Recent bankruptcy filing by Ocean Tankers and parent company Hin Leong Trading could disrupt supply and keep rates elevated over the near term, Bloomberg Intelligence says.
    • Regarding the bankruptcies, Jefferies analyst Randy Giveans says "if these vessels are tied up for legal reasons, this could add fuel to the fire for VLCC rates."
    • Also: TNK +3.6%STNG +5.2%FRO +2.2%TNP +11.3%, NNA +7%INSW +2.8%.

  28. I'd guess shorting /CL would have been a good move today…. 


    • The federal agency that oversees Fannie Mae (OTCQB:FNMA -5.0%) and Freddie Mac (OTCQB:FMCC -4.8%) limits mortgage servicers' advance obligations for loans in forbearance to four months.
    • Mortgage servicers New Residential (NRZ +1.9%), Mr. Cooper (COOP +3.2%) and Ocwen Financial (OCN +6.1%) rise.
    • While the CARES Act allows borrowers of government-backed loans to pause mortgage payments, mortgage servicers were still obligated to pay bondholders.
    • “The four-month servicer advance obligation limit for loans in forbearance provides stability and clarity to the $5T enterprise-backed housing finance market," said FHFA Director Mark Calabria.
    • The Federal Housing Finance Agency is also instructing Fannie and Freddie to maintain loans in COVID-19 payment forbearance plans in Mortgage Backed Security pools for at least the duration of the forbearance plan. Mortgage loans that are delinquent for more than four months, historically were purchased out of MBS pools by the GSEs.
    • The FHFA, Fannie and Freddie will continue to monitor the impact of the coronavirus crisis on the housing market and will update policies as necessary, FHFA said in a statement.
    • Calabria has been criticized his stance that servicers don't need a liquidity facility yet.
    • Mortgage REITs also appear to be stabilizing; (REM -0.2%).
    • Some big mREIT names on the rise include Annaly (NLY +2.3%), AGNC (AGNC +0.8%).
    • Update at 11:30 AM: The FHFA is also considering whether it will allow Fannie and Freddie to buy home loans that recently entered forbearance, the Wall Street Journal reports.
    • That would help mortgage companies that depend on their ability to sell mortgages to Fannie and Freddie soon after they're originated, allowing credit to flow to homebuyers.
    • Bank of America only sees a limited upside for GameStop (GME -12.8%) from the big pop in U.S. videogames software sales in March (+36% vs. -35% in February).
    • Analysts Curtis Nagle and Elizabeth Suzuki note many of the sales for GameStop were pulled forward ahead of the stay-at-home orders and online sales are expected to pick up in general across many titles.
    • The firm keeps an Underperform rating on GME based on its view for a weak slate title for the balance of the year, weakness in the pre-owned segment and the lack of a clear turnaround plan.
    • Videogame stocks are seeing more bullishness this morning (if not share price gains today), as stay-at-home orders soldier on nationwide.
    • "Higher multiples are justified" given some strong tailwinds, Morgan Stanley says in observing the stay-at-home effect. "Publishers continue to see increased player bases, engagement, and in-game monetization" during the duration of the pandemic crisis.
    • It's reiterated its Overweight rating on Activision Blizzard (ATVI -2%), Take-Two Interactive Software (TTWO -0.9%), Zynga (ZNGA -1.7%) and Glu Mobile (GLUU -3.8%). As for Electronic Arts (EA -1.8%), which it rates Equal Weight, it's bumped its price target to $105 from $100, cutting implied downside to 7%.
    • Meanwhile, Benchmark has given a small lift to its Activision target, to $74 from $72. That implies 14% upside.
    • Florida-based Kayne Anderson is having to turn investors away after raising $1.3B in two weeks for a fund targeting distressed property sales. The company says it would typically take 12-18 months to raise such an amount. According to Preqin, in early April there were 939 commercial funds globally looking to raise just shy of $300B.
    • Severe stress for commercial property is likely going nowhere even after the economy begins to reopen. It's hard to imagine hotels and shopping centers operating at anything close to full capacity for months, if not years. And if this work-from-home trend gets a foothold, demand for office space isn't looking good.
    • Among those who have made fortunes from a distressed property in the past and who will likely do so again are Sam Zell, Blackstone (NYSE:BX), and KKR (NYSE:KKR).
    • For those interested in investing alongside Zell, there's Equity Commonwealth (NYSE:EQC), where he's board chairman. It's market cap mostly in cash, the company is more or less a vehicle for Zell and team to buy distressed assets on the cheap.
    • Saudi Arabia and other OPEC members are considering cutting their oil production as soon as possible, rather than waiting until next month when the group's production agreement with the U.S. and Russia is set to begin, WSJ reports.
    • OPEC is rushing to organize a conference call for some ministers to discuss the oil market, according to the report, after WTI plunged into negative territory yesterday.
    • The damage from the Saudi-Russia price war remains: ~80 supertankers out of 750 worldwide are now used to store oil rather than transport it, according to Saudi officials, and the amount of oil in storage at sea rose by 21Mn barrels to 147.6M in the week to April 19, according to commodities data provider Kpler.
    • At least 18 Saudi-hired supertankers are due to arrive next month in the U.S. – which is experiencing lockdowns that did not exist when the oil was sold in March – so with the remaining 10M barrels of unused capacity at the Cushing, Okla., storage hub likely to fill up in the coming weeks, Saudi ships "are looking increasingly ripe to be rerouted and will likely park as floating storage until a buyer emerges" when they arrive in the U.S., RBC analysts say.
    • Analysts respond to IBM's (NYSE:IBMearnings report with some minor price target tweaks and a general "meh" sentiment.
    • Citi (Neutral, PT up $10 to $120) says near-term earnings and sales will shift lower due to the pandemic. Beyond 2020, the metrics "are likely to not move much."
    • The firm says IBM's valuation looks "pretty standard" and attributes the target raise to the overall market multiple expansion.
    • Morgan Stanley (Equal-Weight, PT from $107 to $111) notes that past management focused on earnings or FCF, while the new CEO is focused on revenue growth, "which better aligns with what drives investor sentiment and valuation multiples."
    • The firm thinks IBM remains "committed to both organic and inorganic investments while continuing the recent path of divestitures."
    • Wedbush (Neutral, target cut $15 to $140) cites the mixed results with the service revenue miss and Q/Q growth deceleration for Red Hat and Cloud/Cognitive.
    • Wedbush wasn't surprised by the pulled FY guidance.
    • IBM shares are down 5.1% to $114.27.
    • Prices of copper (HG1:COM) and other industrial metals are broadly lower, as the collapse in oil prices rattles investors and affirms the extent of global demand destruction caused by the coronavirus.
    • Also contributing to copper weakness is the possibility that Glencore will soon re-open its Mopani mines in Zambia.
    • Benchmark LME copper -3% at $5,029.50/metric ton in official trading, down from Monday's one-month high of $5,248/mt.
    • "It looks like a typical risk off day," Julius Baer analyst Carsten Menke tells Reuters. "After the recent rally, you don't need a big excuse to take profit."
    • LME copper inventories at 264,725 ton are near six-month highs, while the discount for cash copper vs. three-month metal at $36.50 is the highest since October, pointing to ample nearby supply.
    • Among relevant tickers: FCX -4.7%TECK -3.8%BHP -3.6%RIO -2.2%SCCO -2.1%HBM -1.4%.
    • Susquehanna turns constructive on Southwest Airlines (LUV -0.1%) even as it warns that it will take several years for travel to return to pre-pandemic levels.
    • "Our base-case view is that travel demand will return in waves as social distancing measures are eased, with pent-up demand driving initial volumes and fare cuts stimulating demand beyond that."
    • LUV stands out with its strong balance sheet and lower mix of international flights than some peers.
    • The firm upgrades to Positive from Neutral.
    • Channel checks from Credit Suisse indicate that most of the CarMax (KMX -2.8%) stores that were closed during the pandemic have reopened in some form, which the firm views as an incremental positive.
    • "We still expect near-term demand to remain weak, with plenty of risks ahead, including the likely decline in GPU, but we also see some opportunities with stores now open, including leveraging its new curbside pick-up that has now been rolled out, the opportunity to more quickly right size inventory, and potentially some benefits from stimulus as we have analyzed."
    • CS also points to aggressive cost actions by CarMax.
    • The firm keeps an Outperform rating on KMX and price target of $76, calling it one of the best stocks to own coming out of the down cycle.
    • HBO Max (T -2.9%) has set its official launch for May 27, adding the latest high-profile combatant to the streaming wars during a period with a somewhat captive stay-at-home audience.
    • The service promises HBO along with added content from the substantial WarnerMedia library, and is going with the tagline "Where HBO meets so much more."
    • It's priced at $14.99/month, the same as the current price for HBO Now, but offers about 10,000 hours of content at launch – along with HBO, it will have original series, third-party content like Friends, The Big Bang Theory and South Park, and movies from Warner Bros. New Line and DC.
    • Those HBO Now subscribers billed directly through HBO will get access to Max at launch for no extra cost; and HBO subscribers through one of AT&T's TV services, or through Charter, will be automatically upgraded.
    • Getting out ahead of Intel's (INTC -1.6%) Core i3 lineup, AMD (AMD -0.1%announces the quad-core, eight-thread Ryzen 3 3300X and 3100 processors.
    • Built with 7nm process tech and Zen 2 architecture, the $99 3100 has a 3.8 GHz base frequency and 3.9 GHz boost. The $120 3300X has 3.8 GHz and 4.3 GHz, respectively.
    • AMD also announces the B550 motherboards, which support the PCIe 4.0 interface on the new Ryzen models and will come from OEMs like Asus and MSI.
    • Availability: The Ryzen processors will start shipping next month, and the B550 will follow on June 16.
    • Kroger (NYSE:KR) discloses that it repaid $500M on a revolving credit facility.
    • The grocery store operator has borrowed $1B on March 18 as a proactive measure to preserve financial flexibility.
    • Shares of Kroger are up 0.09% in early trading to $31.96.
    • SEC Form 424B

    • United States Oil Fund (NYSEARCA:USO) says it has issued all of its currently remaining registered shares-20.5% when halted earlier. Update at 9:25 AM ET: Shares are down 24.3% to $2.84.
    • USO says USCF management is suspending the ability of USO Authorized Purchasers to purchase new creation baskets until such time as the new USO registration statement for the additional shares has been declared effective by the SEC.
    • The ability of authorized purchasers to redeem redemption baskets during the suspension of the sale of creation baskets will remain unaffected, USO says.
    • Also, trading of USO shares on NYSE Arca will not be discontinued as a result of the suspension of sales of creation baskets.
    • Beyond Meat (NASDAQ:BYND) soars in premarket trading after striking a deal with Starbucks in China.
    • The company says the first Beyond Meat product to land in China is a plant-based ground beef product, while the new Good Good menu launching tomorrow at Starbucks in China will include Beyond Beef Classic Lasagna, Beyond Beef Pesto Pasta and Beyond Beef Spicy & Sour Wrap.
    • Shares of Beyond Meat are up 14.76% premarket to $90.96 vs. the 52-week trading range of $45.00 to $239.71.
    • Redbook Johnson reports chain store sales fell 6.9% Y/Y for the week ending April 18.
    • Home improvement store sales were one of the few categories to outperform during the week.

    That's all???  I'd call that good news.

    • In a sweeping look at the grocery sector, Oppenheimer says it expects revenue will stay strong across the industry through the pandemic.
    • The firm is picky within the sector due to the runup of share prices and some notable near-term labor and metered traffic headwinds. Oppenheimer says it sees risks to nearer-term estimates for Costco (NASDAQ:COST) and Dollar Tree (NASDAQ:DLTR), and upside potential for BJ's Wholesale Club (NYSE:BJ), Dollar General (NYSE:DG), Kroger (NYSE:KR) and United Natural Foods (NYSE:UNFI). Sprouts Farmers Market (NASDAQ:SFM) stands out on a valuation basis and earns an upgrade to an Outperform rating.
    • "Consistent with our views since late February/early March, we have viewed our food retailing/grocery coverage as an attractive place to hide shorter-term given potential benefits related to the coronavirus pandemic and the defensive nature of the group. However, clearly from our initial take, we did not anticipate widespread restaurant closures or the US economy to essentially shut down. The group has meaningfully outperformed lately…As we look forward, we see a stronger nearer-term fundamental outlook for the space and the potential for continued outperformance."
    • On a longer view, Oppenheimer has Dollar General, Walmart (NYSE:WMT) and Costco slotted as top picks.
    • Sources tell Nikkei Asian Review that Apple (NASDAQ:AAPL) wants to produce 213M iPhones in the 12 months ending next March, up 4% Y/Y.
    • Production will be split between the newly announced SE and the fall's 5G lineup.
    • Some suppliers expect lower demand for the devices due to the coronavirus pandemic.
    • An unnamed components executive says Apple's production goal is "pretty bullish," and actual production could come in 10-20% lower.
    • Apple is expected to produce 200M iPhones in 2020, about 10% lower than the estimate before the outbreak.

    Also not that bad.

    • Senate Minority Leader Chuck Schumer says a deal on a new stimulus plan aimed at small businesses has been reached, and he expects passage today.
    • Included in the bill is a national testing strategy. Not included is any money for state and local governments.
    • Chatter from the other side of the aisle suggests there's work to be done, however.
    • Developing …
    • Jefferies analyst Brent Thill raises Amazon's (NASDAQ:AMZN) price target from $2,300 to the Street-high $2,800, citing the "attractive growth- adjusted valuation and upside to forward profit estimates."
    • The analyst sees the coronavirus-related demand surge creating long-term operating income upside at high-margin businesses.
    • Thill writes that a sum-of-the-parts analysis shows a 70% upside over three years, and the analyst sees a path to AMZN trading at $4,000.
    • Jefferies maintains Amazon as its top large-cap pick.
    • Upcoming catalyst: Amazon will report earnings on April 30.
    • Cowen keeps a Market Perform rating on Grubhub (NYSE:GRUB) amid COVID-19 risk.
    • Analyst Andrew Charles notes that 80% of the normalized orders for Grubhub are derived from the SMB channel (small and medium businesses) at a higher average margin rate.
    • Charles also warns on Grubhub's exposure to New York City in particular and the loss of corporate business for the near term.
    • "Amid an uncertain and fluid backdrop from COVID-19, our 2020-21 adj. EBITDA are in-line with consensus, and we do not view FY20 valuation as discounted relative to history," writes Charles.
    • "Longer term, we believe GRUB's acquisition of LevelUp, Tapingo, as well as new opportunities such as Ultimate better position the company to compete in the higher margin take-out category. However, we do not underwrite this opportunity given this is unlikely to materially contribute to EBITDA in the near term, while GRUB must battle a new and entrenched competitive set."
    • Cowen keeps a Market Perform rating on GRUB and price target of $42.50.
    • Shares of Grubhub are down 1.18% premarket to $42.00.
    • Morgan Stanley lowers price targets on car rental stocks after accounting for the "extraordinary" business declines in the industry amid the pandemic.
    • Analyst Adam Jonas takes the PT on Hertz Global (NYSE:HTZ) down to $2 from $5, while the PT on Avis Budget (NASDAQ:CAR) is slashed to $7 from $11. Underlining the negative sentiment, sharp volume drops are expected in Q2 for the companies and pricing pressure is seen lasting for the balance of the year.
    • Shares of Hertz are down 1.93% premarket to $4.56 and Avis Budget is off 2.37% to $13.19.
    • Lockheed Martin (NYSE:LMT): Q1 GAAP EPS of $6.08 beats by $0.28.
    • Revenue of $15.65B (+9.4% Y/Y) beats by $580M.
    • Shares +0.9% PM.
    • Press Release
    • Net earnings of $1.7B, or $6.08 per share, up 1.5% versus prior year.
    • Sales by segment: Aeronautics +14%; Missiles and Fire Control +11%; Rotary and Missions Systems flat; Space +10%.
    • Quarterly cash deployment: Capex of $293M; Repurchased 1.7M shares; Paid cash dividends of $693M; Backlog of $144B.
    • The ultimate impact of COVID-19 on the 2020 outlook is uncertain, adds Lockheed, maintaining its guidance on operating profit, EPS and cash from operations (sales outlook was lowered to $62.25B-$64B, from $62.75B-$64,25B).
    • "The outbreak did not have a material impact on the corporation's operating results or business in the first quarter of 2020. However, the corporation is beginning to experience some issues in each of its business areas related to COVID-19, primarily in access to some locations and delays of supplier deliveries," reads a press release.
    • LMT +1.3% premarket
    • Q1 results
    • Travelers (NYSE:TRVQ1 core EPS of $2.62 fell from $2.83 in the year-ago quarter, mostly from higher catastrophe losses partly offset by a higher underlying underwriting gain.
    • Underlying underwriting gain benefited from higher business volumes but was hurt by net charges of $68M after-tax associated with  COVID-19 and related economic conditions.
    • Q1 pretax catastrophe losses were $333M vs. $193M a year ago.
    • Q1 net written premiums of $7.35B rose 4% Y/Y.
    • Net realized investment losses in the current quarter were -$98M pretax, driven by the mark-to-market impact on the company’s equity investments caused by the recent disruption in global financial markets, compared with net realized investment gains of $53M pretax.
    • Q1 underlying combined ratio of 91.3% vs. 91.6% a year ago.
    • TRV  falls 1.8% in premarket trading.
    • Adjusted book value per share of $92.63 at March 31, 2010 vs. $92.76 at Dec. 31, 2019.
    • Conference call at 9:00 AM ET.
    • Previously: The Travelers Companies EPS misses by $0.23, misses on net earned premium (April 21)
    • Ferrari (NYSE:RACE) is offering a voluntary COVID-19 program to employees that includes a blood screening for the virus and an app notification if they have been in close contact to somebody that tested positive.
    • Ferrari currently has the potential to test 800 employees a day. If a blood test indicates an employee might be infected, a COVID-19 swab test is used to confirm the result.
    • The program is reportedly being watched by manufacturers across Europe and North America to see if it is an effective tool in keeping production sites clear of COVID-19.
    • Shares of Ferrari are up 1.22% premarket to $158.92.
    • Philip Morris International (NYSE:PM) reports combined cigarette and heated tobacco unit shipment volume fell by 1.2% in Q1. Cigarette shipment volume was down by 4.4% during the quarter, while heated tobacco unit shipment volume rose by 45.5% to 16.7B units.
    • The quarter only included a limited impact from the pandemic, but adverse impacts are anticipated for Q2 and beyond. Philip Morris warns unemployment and related reductions in disposable income will have a temporary impact on market dynamics in certain markets or the ability of certain small retailers to operate.
    • Q2 EPS guidance is set at $1.00 to $1.10 vs. $1.41 consensus. Philip Morris withdraws full-year guidance due to the uncertainty around the pandemic.
    • Shares of PM are up 0.05% premarket to $76.90.
    • Previously: Philip Morris EPS beats by $0.08, beats on revenue (April 21)
    • Coca-Cola (NYSE:KO) reports organic sales were flat in Q1 to top the consensus estimate for a 2.2% drop. Organic sales were up 4% in North America to offset a 5% drop in the Asia Pacific region.
    • Operating margin improved to 30.7% of sales from 28.2% a year ago.
    • The company says it continued to gain value share in total nonalcoholic ready-to-drink beverages during the quarter.
    • Looking ahead, Coca-Cola warns on away-from-home sales volume. Since the beginning of April, the company has experienced a volume decline globally of approximately 25%, with nearly all of that decline coming in away-from-home channels. KO believes the pressure on the business is temporary and remains optimistic on seeing sequential improvement in the back half of 2020. Formal full-year guidance was not issued.
    • Shares of Coca-Cola are up 1.23% premarket to $47.10.
    • Previously: Coca-Cola EPS beats by $0.07, beats on revenue (April 21)
    • Cleveland-Cliffs (NYSE:CLFannounces additional offering of $555.2M of 9.875% senior secured notes due 2025 at 99% of their principal amount in an offering.
    • Net proceeds will be used to repurchase ~$736.4M of outstanding senior notes, which will result in debt reduction of ~$181.3M.
    • Closing date is April 24, 2020.
    • CLF -1.73% premarket.
    • Previously: Cleveland-Cliffs prices $400M senior secured notes due 2025 (April 16)
    • The U.S. Treasury Department has disbursed $2.9B in aid to U.S. passenger airlines, as part of $25B in funds earmarked for payroll costs.
    • Major airlines must repay 30% of the funds in low-interest loans and grant Treasury warrants equal to 10% of the loan amount, while airlines receiving $100M or less do not need to repay any funds or issue warrants to the government.
    • Finalized grant agreements: American Airlines (NASDAQ:AAL), Delta Air Lines (NYSE:DAL), Southwest Airlines (NYSE:LUV), Spirit Airlines (NYSE:SAVE), and United Airlines (NASDAQ:UAL) and Allegiant Travel (NASDAQ:ALGT).
    • Planning to participate: Alaska Air Group (NYSE:ALK), Frontier Airlines (FRNT), Hawaiian Holdings (NASDAQ:HA), JetBlue Airways (NASDAQ:JBLU) and SkyWest, Inc. (NASDAQ:SKYW).

    • Apple (NASDAQ:AAPL) is launching its App Store, iCloud, Apple Podcasts, Apple Arcade and Apple Music – watch out Spotify (NYSE:SPOT) – to dozens of new markets in Africa, the Middle East and beyond.
    • It's an important expansion for Apple, which is seeking to grow more revenue from selling services as customers have slowed in upgrading their phones.
    • In fact, Apple's services segment set an all-time revenue record last quarter and totaled 17.8% of $260.1B in sales during the most recent fiscal year.
    • Australia's second largest airline, Virgin Australia (OTC:VBHLY), is entering voluntary administration, after failing to secure the required financial assistance from state and federal governments.
    • It's one of the first big airlines to seek bankruptcy protection, with more than 10,000 employees and a roughly 31% market share on domestic routes.
    • "If Virgin Australia disappears, Qantas (OTCPK:QABSY) would effectively have a monopoly of the Australian skies," wrote British billionaire Richard Branson, whose Virgin Group owns a 10% stake in the airline. "We all know what that would lead to."
    • The latest retail casualty from the coronavirus pandemic may be Lord & Taylor, which is exploring bankruptcy protection after temporarily shutting all of its 38 U.S. department stores, Reuters reports.
    • Neiman Marcus also plans to file for bankruptcy as soon as this week, while J.C. Penney is considering a similar move.
    • Fashion startup Le Tote acquired Lord & Taylor last year from Saks Fifth Avenue owner Hudson's Bay (OTCPK:HBAYF), in a C$100M deal that also included real estate, ownership stakes and board seats.
    • Pres. Trump says he will consider a proposal to prevent Saudi Arabian oil from unloading in the U.S. and that he wants to fill the Strategic Petroleum Reserve's 75M barrels of spare capacity to store crude, after U.S. front-month crude prices turned negative today.
    • Trump today called the unprecedented slump below zero "more of a financial thing than an oil situation," adding that it will be "very short term."
    • But it depends on the meaning of "short term," as it likely will take months before oil production cuts fall enough to come in-line with reduced demand – even if world economies rebound somewhat as people recover from the coronavirus pandemic – and with storage soon to be completely full in the U.S., crude will have no place to go.
    • "It's clear that Cushing is going to fill and it will stay full for the next several months," says Andy Lipow of Lipow Oil Associates.
    • "We're probably unfortunately going to see this dislocation in these energy contracts remain in place for next month as well," says OANDA analyst Edward Moya. "You're going to see this remain in place until we really start to see the oil giants… just be forced to stop production.”
    • "At the least, the craziness in oil… underscores how the problems facing the global economy from the coronavirus pandemic won't soon go away despite the recent rebound in equities," writes Bloomberg's Robert Burgess.
    • Nuclear power plants are now able to require longer shifts for their workers and delay some inspections, the Nuclear Regulatory Commission says, as operators cope with fewer available workers and social distancing worries amid the coronavirus outbreak.
    • At least 42 construction workers recently tested positive for the coronavirus at a nuclear plant in Georgia where Southern Co. (NYSE:SO) is building two new reactors, and the utility and its partners said they would reduce the 9,000-person workforce by 20% to slow the spread of the virus.
    • Exelon (NASDAQ:EXC), operator of the biggest U.S. nuclear fleet, says it "can no longer meet the work-hour controls" at four of its reactors, including the Braidwood plant in Illinois, and NextEra Energy (NYSE:NEE) has made the same claim about its Seabrook power plant in New Hampshire.
    • Pinnacle West Capital (NYSE:PNW) also has been approved for longer hours and is postponing an inspection at its Palo Verde nuclear plant in Arizona, the biggest U.S. nuclear plant.
    • "The work-hour rule exemption is an important contingency that may be implemented to allow healthy workers to remain on site for more hours, reducing the need to bring in outside travelers and vendors," says an Exelon spokesperson.
    • Watchdog groups are concerned that employees may be overworked, leading to fatigue and potential errors.
    • Robinhood's Co-CEO, in an interview on Jim Cramer's Mad Money, noted that they saw increased buying activity in March, rising 60% over the prior month. That compares with other platforms, like Interactive Brokers, which disclosed DARTs up 46% m/m.
    • The executive in the interview said that despite the technical difficulties seen at the beginning of the month, the application remained among the most downloaded in the trading sector.
    • He also named the top 10 stocks that were most bought on the platform during the month, including: Inovio (NASDAQ:INO), Ford (NYSE:F), American Airlines (NASDAQ:AAL), Boeing (NYSE:BA), Carnival Corp. (NYSE:CCL), General Electric (NYSE:GE), Microsoft (NASDAQ:MSFT), Disney (NYSE:DIS), Aurora Cannabis (NYSE:ACB) and Tesla (NASDAQ:TSLA).

  29. /CL/1020 – Well if you had shorted June yes, but not May, which is back to $8.  So I guess any day you pick the right direction on the day something moved a lot was a good day to play it….  cheeky


  30. any brave souls tempted by USO?


  31. it can't be called a "political ploy" when you're dead. So there's that.


  32. /CL – I do have June on my TOS and it requires $4500 per contract.

     

    I am working with some UCO in the thirteens….


  33. Ploy/BDC – That certainly gets him nominated for "Ironic Death of the Year".  

    Well, 10% of the people who had the virus have recovered in the US so let's declare victory, right?  And only 36% of the outcomes have been death – that's 64% not dead. 

    /CL/1020 – When it's negative the broker should give you $4,500 in margin for trading it!


  34. BDC / USO

    i got in heavy(ish) and short this morning.  On a nice gain but have been locked out for a while.. /CL shot up $3 during the halt.  Where do i find up to date info on the status of trading?


  35. This is fine:

    Back to work you lazy people!  

    Here's the US:

    That's impressive.  We got a late start but we're catching up!


  36. sounds like they're restructuring their contracts?! can they do that .. haha this is nerve wracking 


  37. BDC – It sucks for "prove me wrong" guy when he's been proven 'wrong'…. ;)


  38. This is what flattening looks like – you'll know it when you see it and it sure isn't what we have now….

    SoKo:

    China:

    Iceland:

    Unfortunately, those are the only 3 countries that are really flattening.  All this talk about giving up quarantine this early in the process scares me more than anything else so far.  I think it's a massive mistake that can make things so much worse.

    Oil $12.25/13.40 – See, easy roll if you just wait patiently!  cool


  39. USO. wow. they really pulled the rug out.  Halted and shifted contracts and the price bounced and caused me some pain. Lesson learned i suppose but damn. 


  40. USO – I'm thinking about going into some OTM spreads for Dec 2022. For example the 3/5 spreads are about 47 cents 325% profit at 5. The 4/8 is 67 cents, 497% profit at $8. The 6/8 is 25 cents 700% profit at 8. I know they're not PSW-type plays but I can't imagine oil staying at these prices to the end of 2022. Obviously not for the faint-hearted, and not a place to put all of one's eggs, but thinking it might be worth a shot.


  41. Or perhaps buy the long side for Dec 2022 ITM, and then sell short term calls against it along the way. I don't know, I've got to ponder this a bit.


  42. Dawg

    I thought of this too. I think its a fun play for a small amount of money.  I may wait and see how things settle out in a couple days and reconsider. 


  43. USO could go the way of OIL so be careful on anything long term


  44. Is there a good way to short Credit Acceptance Corp CACC, on the potential they have serious non-payment issues.


  45. What happened to OIL, looks like it's still trading…


  46. 1020 – that sounds like my investment premise since March 23rd…


  47. dawg – https://finance.yahoo.com/news/barclays-announces-redemption-ipath-series-001100135.html

    adds a wild card to options past April 23rd (if USO can do this same mechanism)


  48. Oh those crooks at Barclay's. That's one way to sell high and buy low.


  49. I do not like the ETN structures in falling markets, I kind of learned my lesson when Lehman went BK and brought down some of their schemes. MLPQ was too good as well, until it was not.


  50. CACC/Dawg – They are already down 1/3 and you have to be careful as the Government might bail them out.  I would go with the July $200 puts at $20 with a stop at $10 and 1/2 off if you get to $40 – to limit the losses.   As to oil – it's completely broken, probably just catching up on orders after the close.  

    Well, that was not a pretty day at all.  

    Done with /ES shorts (those were my main ones).  2,725 was plenty! 




  51. Pandemic’s Costs Stagger the Nursing Home Industry



  52. never gambled on USO. The 3's were 33 cents and 3.50's were $0.16 to $0.17. Felt like too much of  apop was needed and USO owns front month contracts only, I believe.


  53. I wish I had the stomach for TSLA weeklies. 747 to 679 in 90 minutes (-9.2%)

    that's spectacular for traders




  54. Trump (the Company) Asks Trump (the Administration) for Hotel Relief



  55. 11 words from John Oliver that expose Fox News’ fundamental hypocrisy


  56. Here is a study out of China (take it for what its worth) that took samples from Wuhan in the relatively early stages of the pandemic and found 30 different mutations of the virus, 19 of which were considered novel.  

    "In short, our study provides direct evidence that mutations currently occurring in the 348 SARS-CoV-2 genome have the functional potential to impact the viral pathogenicity. "

    https://www.medrxiv.org/content/10.1101/2020.04.14.20060160v1

    So the virus IS found to be mutating which could pose obvious issues in vaccine development.