XmaX

What we find even more amazing is that despite their growing lack of faith in their models (models that the FT describes as fiendishly complicated), some central bankers still believe that forward guidance (aka simple jawboning) is an effective policy tool even when they are worried that their fiendishly complicated models are not up to scratch. Let’s just say we’re sceptical on this front. In fact, we’re pretty sceptical whenever a central banker speaks nowadays, as they are often self-serving, duplicitous and completely ignorant of the unintended consequences which we truly believe are yet to be seen from their audacious monetary policy experiments of the last decade. A number of central bankers were either speaking publicly or being interviewed by the media in Washington. Outgoing Fed vice chair Fischer said the US has room for more investment and consumption. Dallas Fed president Kaplan said that business activity was strong and the consumer was in good shape. St Louis Fed presi...

Data last week showed that the U.S. created 223,000  new jobs in May, pushing unemployment down to an 18-year low of 3.8%. That news reinforced expectations the Fed will raise interest rates at least two more times in 2018 following its March rate increase, possibly as soon as this month. Rising real interest rates impact the opportunity costs of holding gold because the metal provides no yield, and entices investors to rotate into riskier assets like stocks. Higher rates may also boost the value of the dollar, which usually moves in the opposite direction of the gold price. “Concerns over the path of protectionist policies that the U.S. is taking could resurface as the [Group of Seven] prepares to meet in Canada this week…” said Richard Perry, analyst at Hantec. “This is leading to a degree of consolidation across forex and commodities markets.” G-7 nations will hold talks in Canada on Friday and Saturday, where tariffs and trade are likely to be discussed. This weekend...

The bottom line, meanwhile, is, well, the bottom line. In other words, the market “correlates most directly to the direction of EPS,” or earnings per share, Dwyer said. And with EPS expected to grow over 20% in 2018 and keep growing in 2019, the stage is set, he said (see chart below). Why so confident on EPS, though? Dwyer said EPS moves with the direction of the economy, and while global growth is slowing, recent data show the U.S. picture remains very positive, with the Atlanta Fed’s gross domestic product tracker now signaling 5% annualized growth for the second quarter. It won’t necessarily be smooth sailing, Dwyer said, with geopolitical and midterm election worries likely to continue to make for volatile conditions, though such episodes should be viewed as buying opportunities. “Throughout this cycle, each intermediate-term correction feels like the fundamental and tactical backdrop is at risk, only to ultimately realize that positive influences that drive our core the...

The popularity of the Project Rock 1 could be a sign of improvements to come. “We believe that the limited availability (and subsequent restocking) is part of the company’s plan for managing the franchise to generate buzz and promote a ‘call to action’ and represents a positive for brand equity,” wrote Instinet analysts led by Simeon Siegel. On Monday, Stifel analysts raised their price target on Under Armour shares to $27 from $20 after discussions with the company. “We are particularly encouraged by opportunities for gross margin improvement from both elimination of the liquidation burden and improved sourcing (SKU [stock keeping unit] rationalization, materials planning, factory consolidation, capacity planning, etc.),” Stifel wrote. Stifel rates Under Armour shares buy. Other fashion brands, like Tapestry Inc.’s  TPR,  -0.86%  Coach brand and Michael Kors Holdings Ltd.  KORS,  +4.90%  have taken steps to  reduce distribution  in...