Good Morning all! Regional bank PacWest is up 34% premarket after rising 81% on Friday. They cut their dividend to conserve capital. With a short interest rate of 19% on the stock, short covering is definitely taking place.

market

Prices from 05/16/23

macro

Woodstock for Capitalists took place over the weekend as 30,000 supporters of the Oracle of Omaha watched two old men eat peanut brittle and talk about markets. Here are some takeaways:

• Buffett shut down speculation that Berkshire would make an offer for full control of Occidental Petroleum Corp. could make after the company spent months buying the energy producer’s shares.

• The recent turmoil in the banking industry has been fueled by a heady combination of contagious fears, distorted regulatory stimulus and bad news.

• The economic outlook will weigh on his companies’ profits as an “incredible” spell for the US economy eases.

Friday’s NFP numbers beat expectations

• The number was 253,000 versus estimates of 185,000 and 236,000 in the previous period

• Stronger labor market does not encourage rate cut go-ahead

• Take this number with caution – the last print in April was revised down by almost 100,000 and there have been large discrepancies in the last few revisions

More debt ceiling drama this week and Biden and McCarthy looking to break the stalemate.

• President Joe Biden and senior Republicans and Congressional Democrats will meet this week to try to resolve a three-month standoff over the US $31.4 trillion debt ceiling and avoid a default before the end of May.

• Biden wants to raise the credit limit unconditionally.

• Spokesman McCarthy said his chamber would not approve an agreement that did not cut spending to address a growing budget deficit.

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China Banks raise limit.

• Chinese investors are banking on Beijing’s commitment to give state-owned companies access to more capital and play a bigger role…