Jobless Report, This Is Not Good -- July 31, 2014; MPC Beats By $0.78; Other Energy Companies Blowing Away Expectation

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 JOBS REPORT

Well, This Isn't Good

Claims are in-line with expectations, but expectations would not have earned a smiley face emoticon.

Data points:

• expectations: 300,000 (after last week's "stellar" report -- only 284,000, revised downward to 279,000)
• actual: 302,000
• market reaction: the Dow tanks immediately after news; had been trending higher in pre-market futures; down "triple-digits"

Comments: this takes us back to the reported GDP of 4%, yesterday. The media reaction was muted, and the market was not impressed. It makes one wonder to what degree the GDP might have been massaged. Except for a few respondents to my poll, "no one" thought 2Q14 GDP was going to be above 3%; in fact, big-name analysts had lowered expectations from 3.1% to 3.0% the day before the report. And now, the jobs report today. Something feels fishy. Very fishy.

Now, the jobs report. I can understand the number of jobless claims being revised UPWARD but I don't understand (and have never seen [which doesn't mean it hasn't happened] jobless claims revised DOWNWARD. Jobless claims are simply counting the applications that come in. The number should be revised upward because a) some applications will be in the mail; b) some states are slow in reporting data; c) sometimes "they" conveniently miss a stack of applications [which often happens the week before important elections]. But I can't think of a reason why the numbers should be revised DOWNWARD. Did some states double-count applications last week for some reason, and then go back and re-count them? We know that the government has manipulated the jobless numbers [previously posted, citing an impeccable source] before. Something feels fishy. Very fishy.

But let's assume the numbers are right. Back up to 300,000 first time claims. Five years into the recovery and workers are getting nowhere.

For the record:

• four-week moving average, 297,250. Down 3,500
• continuing claims climb: 2,539,000, up from last week's revised 2,508,000.

UC Irvine? Really?

Los Angeles Trade-Technical College? Really?

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Reporting today: COP, EEP, HP (flex rigs), KOG, MPC, OXY -- according to Yahoo!Finance.

• APA: beats by 1 cent, misses on revs
• American Railcar: beats by 30 cents; nice
• COP: profit rises 1.5%; profit in-line
• XOM: beats by 19 cents; huge; revenues rise almost 5%; production declined y/y
• EEP: after market close
• HP: beats by 12 cents; wow! revs up 13%
• KOG: after market close
• MPC: beats by 78 cents; wow, what happened here; maybe more later; revs also rose almost 5%
• OXY: beats by 6 cents; profit rises 8%; on a triple-digit down day for the Dow, OXY is up very, very nicely

Enterprise Products executes additional agreement for ethane export terminal; evaluating expansion options: Co announced that it has executed an additional long-term contract to provide ethane storage, transportation, refrigeration and loading services from its new ethane export terminal that is currently under construction on the Houston Ship Channel.

• With this new agreement, the co now has long-term commitments for approximately 85 percent of the capacity of the ethane terminal

The Wall Street Journal

How GDP of 4% affects the Fed's thinking.

Current sanctions against Russia won't be enough.

Argentina ... going ... going ... gone....

Some US states, such as Colorado and Illinois, are overwhelmed by number of undocumented immigrants seeking licenses. At least in Colorado, they can smoke while waiting.

Biggest casualty of the Ukraine: Russian-German ties. Russia is Germany's #1 trading partner. Oh-oh.

Huge story: US oil exports ready to sail. Tanker of Texas oil heading to South Kore in first sale since 1970s embargo.

How that $40 million shipment avoided the nearly four-decade ban on exporting U.S. crude is a tale involving two determined energy companies, loophole-seeking lawyers, and an unprecedented boom in American drilling that could create a glut of ultralight oil.

The Singapore-flagged BW Zambesi is the first of many ships likely to carry U.S. oil abroad under a new interpretation of the federal law that bars most sales of American oil overseas.

Analysts say future exports appear wide open: as much as 800,000 barrels a day come from just one of the many U.S. oil fields pumping light oil. Though U.S. policy on oil exports hasn't changed, production of this kind of oil, known as condensate, is surging.

This early shipment "is the wedge that's pushing the door open" for more ultralight oil exports, said Daniel Yergin, vice chairman of consulting firm IHS. 

Cash-poor Venezuela weighs sale of Citgo. Warren Buffett is burning the midnight oil, as they say.

Boeing plans to build its flagship, the 787 Dreamliner jet, exclusively at its non-union factory in South Carolina.

XOM starts to sputter.

The Fed's latest statement raises the possibility that a rate increase will come sooner than many expect.