Deere Beats! Shares Jump 13%; The Ethane Story Simply Won't Quit -- RBN Energy -- August 19, 2016

Unemployment rate rises in seven states, as reported at The Hill. The questions:

a) whether the states are "swing states"
b) whether the states "matter"
c) whether there are any "surprises"
d) whether the increases are even "significant"
e) whether they are related to "energy"
f) a "blue" state

So, let's see. Here are the seven states reporting a rise in unemployment:

• Iowa (f; b, maybe)
• Kansas
• Maine (f)
• Missouri 
• New Mexico (f)
• Oregon (f)
• South Dakota - has the lowest unemployment at 2.8%.

Other data points:

• not one "energy" state was on the list, although Alaska was noted to have the highest unemployment rate at 6.7%.
• North Dakota was mentioned with an unemploment rate of 3.1%, much lower than the national average.
• California added 374,000 jobs over the last year, but its 5.5% unemployment rate still remains higher than the national average of 4.9%.
• finally, since October, 2009, when the US unemployment rate peaked at 10%:
• California has added 800,000 jobs
• Texas has added the most jobs of any state: 1.2 million jobs
• Florida has added 625,000 jobs

 

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Active rigs:

	8/19/2016	08/19/2015	08/19/2014	08/19/2013	08/19/2012
Active Rigs	33	74	192	183	199

RBN Energy: US ethane squeezing out Canadian propane/butane in Sarnia.

The availability of vast amounts of ethane from the nearby “wet” Marcellus and Utica plays is spurring a petrochemical rejuvenation in Sarnia, ON. Two years ago NOVA Chemicals stopped using naphtha as a feedstock at its 1.8 million pound/year ethylene plant in Sarnia’s Chemical Valley and now relies on a combination of ethane, propane and butane. Next year the company is planning to complete the plant’s conversion to 100% ethane and is considering the possibility of building a big polyethylene plant nearby. Today, we continue our comprehensive review of southwestern Ontario’s NGL, petchem and refining infrastructure, including Sarnia’s NGL fractionation, storage and end-use markets.  

Sarnia has been a major player in crude oil, refining and petrochemicals for well over a century. An 1858 oil well in nearby Oil Springs, ON is said to have been the first on the continent, and over time, oil-production, refining and petchem infrastructure was developed in southwestern Ontario (as were pipelines and railroads). Sarnia’s role as a major refining/petchem player continues to this day, decades after most oil production in southwestern Ontario dried up.

Previously we looked at the crude oil side of things, describing the three refineries in Chemical Valley, the oil pipelines that supply them, and the petroleum-products pipelines that help move the refineries’ output to market. In today’s episode, we turn to Sarnia’s important NGL sector: the pipelines that transport purity ethane and mixed propane/butane to Chemical Valley, the fractionator that separates mixed NGLs into purity products, the NGL storage facilities, and the big ethylene plant that “cracks” ethane, propane and butane into ethylene –– a critically important petchem building block.

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The Market

Closing:  down 45 points at the end of the day. NYSE:

• new highs: 115, add, CLR (a big whoop); HAL; ONEOK.
• new lows: 9

Mid-day: not much change, though the market has recovered significantly from the open; now down only 34 points. NYSE:

• new highs: 82, included Edwards Lifesciences (a huge whoop); Encana; Pioneer Natural Resources (has been on a huge roll this past week); WPX; XLNX (not on the NYSE)
• new lows: 9

Opening: down 100 points; Fed rate increase back on the table. Yawn. Buying opportunity.

I completely missed this yesterday: Edwards Heart valve wins expanded FDA approval; stock hits record close.

Wow: Deere beats 3Q16 earnings expectations! Shares jump 13%. 

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WSJ Headlines

Lyin' Ryan: Lochte's teammates, USOC "discredit" robbery story.
Comey's FBI double standard, an op-ed. Great role model. Not.
President used "leverage" -- not a ransom -- to obtain prisoner release. Leverage, contingent, but not a ransom.
Russia builds up army near Ukraine border: October surprise?

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Speaking of Double Standard

Like Father, Like Daughter

Do you remember that "leaked" video of Malia Obama toking? It turns out that she was alerted, and "removed" from the party moments before the party was raided by cops. Double standard?  

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Good Intentions. Good Outcome?

This is a big, big story. It will gain traction as we go into 2017: watch out retirement savers. Your choices are poised to shrink. This is the "ObamaCare" equivalent for the mutual fund industry. The comments help put the story into perspective.

Brokerage Edward Jones, anticipating the fiduciary rule that will require brokers to put the interests of retirement savers ahead of their own, said on Wednesday that it would stop offering mutual funds and exchange-traded funds in retirement accounts that charge investors a commission. The move makes the St. Louis firm the first big player to disclose detailed plans on retirement accounts that charge a commission.

Retirement savers could be forced to make decisions in the months ahead as other firms determine how they plan to operate under the Obama administration’s new rule, which starts to take effect in April. The rule doesn’t extend to nonretirement accounts.
Among the requirements in the rule, brokers have to justify the varying compensation they can receive for recommending one investment product over another to a retirement saver. Brokers said that rule makes sales fees on some mutual funds, known as sales loads, and some funds’ differing share-class prices problematic for accounts that charge investors for each transaction made.

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Movies

Updates

August 20, 2016: in the original post I noted that I wouldn't even think of going to Ben-Hur; Morgan Freeman's hair-do was not one of his best choices. Well, the numbers are in, and .... "Ben-Hur bombs -- Hollywood Deadline:

With an estimated production cost that’s in the vicinity of $100M, MGM and Paramount certainly didn’t build Ben-Hur to fail this weekend.

But if there’s one Come-to-Jesus from this remake’s estimated disastrous $11M opening: It’s still a challenge for Hollywood to cross over a faith-based film to the masses 12 years after the $370M ($612M global) success of Mel Gibson’s The Passion of the Christ.

Original Post

 

Apparently Woody Allen's Cafe Society" opened to very limited release and due to family conflicts we did not make any of the showings -- in the local area, the movie was showing at only one theater for three days. Now we will wait until wide opening.

However, The WSJ has a great review of Hell or High Water. Sounds like a nice alternative sometime this weekend.

Ben-Hur: we saw the trailer. It's a laugher. Wouldn't even think about going. Morgan Freeman's hair-do probably not one of his best choices.

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The Apple Page

Apple will drop "Store" from "Apple Store." It's no longer the Apple Store in Southlake, it's "Apple Southlake." "Apple Fifth Avenue" sounds great, but some names just don't work, like "Apple The Grove" -- the Apple store at the Grove in west Los Angeles.

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For The Granddaughters

The Olfactory Page
Why Dogs Sniff

From the NIH.gov:

Olfactory receptors (ORs), the first dedicated molecules with which odorants physically interact to arouse an olfactory sensation, constitute the largest gene family in vertebrates, including around 900 genes in human and 1,500 in the mouse. Whereas dogs, like many other mammals, have a much keener olfactory potential than humans, only 21 canine OR genes have been described to date.

In this study, 817 novel canine OR sequences were identified, and 640 have been characterized. Of the 661 characterized OR sequences, representing half of the canine repertoire, 18% are predicted to be pseudogenes, compared with 63% in human and 20% in mouse. Phylogenetic analysis of 403 canine OR sequences identified 51 families, and radiation-hybrid mapping of 562 showed that they are distributed on 24 dog chromosomes, in 37 distinct regions.

Most of these regions constitute clusters of 2 to 124 closely linked genes. The two largest clusters (124 and 109 OR genes) are located on canine chromosomes 18 and 21. They are orthologous to human clusters located on human chromosomes 11q11-q13 and HSA11p15, containing 174 and 115 ORs respectively.

This study shows a strongly conserved genomic distribution of OR genes between dog and human, suggesting that OR genes evolved from a common mammalian ancestral repertoire by successive duplications.

In addition, the dog repertoire appears to have expanded relative to that of humans, leading to the emergence of specific canine OR genes. Olfactory receptor (OR) genes were first discovered in Rattus norvegicus in 1991 by Buck and Axel. They belong to the G-protein-coupled receptor superfamily, which is characterized by seven hydrophobic transmembrane domains.

In mammalian genomes as many as 1,000 OR-encoding genes are predicted, comprising 3-5% of the total gene content. The OR repertoire thus forms the largest known gene superfamily, also known as the olfactory subgenome.

Each OR gene consists of a single coding exon of about 1 kilobase (kb). Conserved regions that encode transmembrane domains 3 (TM3) and 7 (TM7) have been used to design degenerate oligonucleotides that are specific for the OR gene superfamily. Using such primers, a number of OR gene sequences have been cloned from several other mammalian species such as human, mouse, dog (Canis familiaris) and pig, as well as fishes and amphibians.

The consensus sequence in Drosophila melanogaster is distinct, and the coding region can be split by introns. This is also the case in Caenorhabditis elegans, in which some 600 chemoreceptor sequences have been found by systematic searches of the complete genome sequence.

Key words (phrases) for the granddaughters:

• HSA
• introns
• pseudogenes

Three observations/findings jump out:

• in mammalian genomes as many as 1,000 OR-encoding genes are predicted, comprising 3-5% of the total gene content. The OR repertoire thus forms the largest known gene superfamily, also known as the olfactory subgenome
• this study shows a strongly conserved genomic distribution of OR genes between dog and human, suggesting that OR genes evolved from a common mammalian ancestral repertoire by successive duplications
• the dog repertoire appears to have expanded relative to that of humans, leading to the emergence of specific canine OR genes
• of the 661 characterized OR sequences, representing half of the canine repertoire, 18% are predicted to be pseudogenes, compared with 63% in human and 20% in mouse