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  • phil

    Terrible drop from May but still expanding (anything over 50):

    Jul. 01, 2022 9:45 AM ET5 Comments
    • June PMI Manufacturing Index52.7 vs. 52.4 expected and 57 in May.
    • The headline PMI fell to its lowest since July 2020 in the wake of sluggish factory output and a drop in new orders at manufacturing firms.
    • Sales declined for the first time since May 2020 amid inflationary pressures.
    • “The PMI survey has fallen in June to a level indicative of the manufacturing sector acting as a drag on GDP, with that drag set to intensify as we move through the summer,” said Chris Williamson, chief business economist at S&P Global Market Intelligence.
    • Earlier this week, (June 30) June Chicago PMI missed consensus mark.

    Chicago was 56.

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    SHEL -0.59%Jul. 01, 2022 9:27 AM ET7 Comments

    Shell (NYSE:SHEL) said on Friday it is assessing the implications of a Russian decree that would allow its government to take charge of the Sakhalin-2 natural gas project, in which the company owns a 27.5% stake.

    Vladimir Putin signed a decree on Thursday that would transfer all rights and obligations of the consortium behind Sakhalin-2 to a new Russian entity, effectively giving the Kremlin a veto over which foreign investors will be allowed to keep their stake.

    Putin’s decree gives foreign investors one month to ask the Russian government for a stake in the new entity.

    After Russia invaded Ukraine, Shell (SHEL) said it would sell its 27.5% stake as part of plans to leave Russia altogether.

    Japan’s Mitsubishi (OTCPK:MSBHF) and Mitsui (OTCPK:MITSY) own respective 10% and 12.5% stakes in the project, while Russia’s Gazprom (OTCPK:OGZPY) owns 50%.

    Sakhalin-2, in Russia’s far east, is one of the world’s largest oil and gas projects, supplying ~4% of the global liquefied natural gas market.

    Reuters reported a few weeks ago that Shell (SHEL) was in talks to sell its investment in Sakhalin-2 to an Indian consortium.

    GM -5.05%Jul. 01, 2022 9:17 AM ET3 Comments
    • General Motors (GMsaid it expects Q2 net income to be in the range of $1.6B to $1.9B as vehicle wholesale volumes were impacted by the timing of certain semiconductor shipments and other supply chain disruptions.
    • Shares were trading -2.36% pre-market.
    • The automobile company expects adjusted EBIT to be between $2.3B and $2.6B.
    • For Q2, consensus EPS estimates are $1.60 and consensus revenue estimates are $36.66B.
    • For FY22, the company reaffirmed its net income guidance range of $9.6B to and $11.2B, adjusted EBIT guidance range of $13.0B to $15.0B, adjusted EPS guidance range of $6.50 and $7.50.
    • FY22 consensus EPS estimates are $6.99 and consensus revenue estimates are $151.89B.
    • GM is expected to announce its Q2 results on Jul. 26.
    GM -5.05%Jul. 01, 2022 9:25 AM ET2 Comments

    General Motors (NYSE:GM) struggles with the ongoing chip shortage overshadowed its reaffirmed guidance on Friday.

    In an SEC disclosure filed ahead of Friday’s open, the company reaffirmed full year net income guidance range of between $9.6B and $11.2B, EBIT-adjusted guidance range of between $13B and $15B, EPS-diluted guidance range of between $5.76 and $6.76, and adjusted automotive free cash flow guidance range of between $7B and $9B among other key metrics.For the quarter ended on June 30, the SEC filing containing the guidance update set the net income expectations to be in the range of between $1.6B and $1.9B.

    The automaker also beat expectations for the second quarter in sales, moving 582,401 vehicles to dealerships in the US to mark its third consecutive quarter of sequential growth. While the figure was still a stark 15% below the sales in the year prior, analysts had expected an over 17% drop.

    However, the company noted that its demand has far outstripped its supply and ability to deliver to dealers. As such, many of the sales it had expected to deliver in June were delayed into the back half of the year.

    “GM’s second quarter vehicle wholesale volumes were impacted by the ongoing semiconductor supply shortage and other supply chain disruptions mostly in June,” the release explained. “As a result, GM will hold about 95K vehicles manufactured without certain components in company inventory until they are completed and will recognize revenue when they are sold to dealers, which is expected to happen throughout the second half of 2022.”

    Shares of the automaker fell over 2% before Friday’s open on the indication of persistent supply chain problems.

    Read more on recent price hikes pursued by the auto manufacturer.

    SPY -0.81%Jul. 01, 2022 9:11 AM ET23 Comments

    This year is shaping up to be historic in terms of real asset performance, according to BofA Securities.

    In his weekly Flow Show note, strategist Michael Hartnett wrote Friday that in real terms, government bonds (TBT) (TLT) (SHY) are on course for their worst performance since 1865.

    The S&P 500 (SP500) (NYSEARCA:SPY) is looking at its worst year in real terms since 1872, Hartnett said.

    Meanwhile, commodities are on track for their best year since 1946.


    Fed expectations peaking

    Fed hike expectations are “peaking,” with the largest inflows into TIPS (TIP) in 12 weeks, Hartnett said. But inflation expectations are not peaking, with the 14th-consecutive week of outflows from Financials (XLF).

    Materials (XLB) and Energy (XLE) saw the largest outflow ever, while the largest inflow into emerging market equities (EEM) (VWO) in nine weeks indicated that recession odds are rising.

    See Wolfe Research’s stock market bottom checklist.

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