Hiring Count Remains Strong in the U.S. – Closing Bull June 3rd, 2022
In this week’s Closing Bull, the latest job report for the U.S. has come in showing strong numbers in hiring. Elon Musk emailed his employees to let them know he was cutting 10% of salaried workers. Big oil organizations to increase crude production to help offset the loss of sanctioned Russian oil. Russia’s plan to export oil to willing buyers like China and India has hit a snag. The UK and the EU could potentially cut off Russia from insuring their tankers. Last but not least, an interesting fact to cap off the week.
Let’s get into the news.
Key News This Week:
U.S. hiring remains strong.
Elon Musk cuts 10% of salaried workers.
Oil organizations increase crude production to offset the loss of sanctioned oil.
Russia’s plan of exporting oil to willing buyers hits a snag.
The UK and EU have the potential to cut off Russia from insuring their tankers.
Read the Transcript
Hi and welcome to my financial markets’ re-cap for the week.
We closed a nice trade this week, one of the biggest for the year, but saw the trade we closed today gave back most of its gain from yesterday. Still, a win is a win, big or small, and we have another forecast coming soon.
That was the system update, what is happening in the news?
The news this week was dominated by stories around energy prices and shipments, but before we get to that:
The big news today was the monthly job report from May. Hiring in the U.S. remained strong with the Nonfarm payrolls number showing an addition of 390,000 jobs last month. Economists expected 328,000 jobs, so better than expected.
But this wasn’t enough good news to cheer the market, as I suspect it got a little spooked by Elon Musk’s reported email to all employees at the electric vehicle maker this morning, stating that the company will cut 10% of salaried workers and will instead rely on more hourly workers. This was following statements from Elon about his concern for the economy recently.
Back to the major energy news, the oil cartel, AKA, OPEC pledged to increase crude production by 650K barrels a day in July and August. It is hoped that this will help offset the loss of sanctioned Russian oil on the worldwide market.
However, the release in the US of 1M barrels of oil a day from the strategic reserve hasn’t made a dent to temper the soaring pump prices as summer travel kicks off.
Speaking of travel, Delta said sales have snapped back to pre-pandemic levels, which is helping to offset soaring fuel costs. So, this is some good news for the economy at least.
But there was another major energy event at the beginning of this week regarding oil. There was a meeting by EU leaders regarding further sanctioning against the use of Russian Oil.
The outcome of that meeting is that there will be a ban on all Russian oil that comes into the EU by sea, that’s 90% of all Russian oil imports by the end of the year.
There is an exemption for oil coming in by pipeline (the remaining 10%), a concession made for landlocked Hungary, Slovakia, and the Czech Republic.
Refineries around the world are already running at full capacity and are still struggling to meet demand. That will not change anytime soon as China starts loosening its Covid lockdowns in cities like Shanghai.
Added to that, Russia’s plan on exporting oil to willing buyers like China and India at discounted prices could hit a snag. Russia may be cut off from the ability to insure tankers carrying the Russian crude.
Reports are that the UK and EU, which control much of the maritime-insurance industry, are about to do just that and if Moscow can’t insure its tankers, it’ll be effectively cut off from exporting oil by sea. Less oil on the market could mean gasoline prices are cheap right now!
What a world we live in…
Interesting fact this week:
Vegas chapels are “all shook up” after Authentic Brands, the licensing company that controls Elvis’ name and likeness, ordered them to stop using Elvis impersonators in ceremonies. A major hit to Sin City’s $2B/year wedding business…how bizarre! Vegas without Elvis, surely not!
That’s it from me, It’s Friday, time to down tools, thanks for watching, and bye for now.
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