Equities and the Economy:

• Major indexes close at record high for third consecutive session.
• S&P 500 reaches market cap of $20 trillion for first time ever.

U.S. stocks extended gains yesterday with the three major indexes closing at record highs for the third consecutive session with financial and industrial stocks leading the way. Once again it’s optimism surrounding Trumponomics with the latest being his announcement that he’ll be releasing shortly a “phenomenal tax plan.” The Dow rose 143 points, 0.70%, to 20,412, the S&P 500 added 12, 0.52%, to 2,328 and the Nasdaq ended up 30 points, 0.52%, at 5,764. The S&P 500 passed a milestone with the market cap of the index reaching $20 trillion for the first time ever. The financial sector closed up 1% leading all sectors and notching its 14th record close since the election in November.

As I’ve been stating for a while, we’re in a bull market. How bullish is it? The S&P has gone 85 days without a daily decline of at least 1%. That is the longest streak since November 24, 2006 and is closing in on the 105 day streak set on December 15, 1986.

There were no economic reports of significance released yesterday. Today investors will be focusing on Fed Chairperson Janet Yellen as she testifies before the Senate Banking Committee. She’s required to do this periodically.

This morning it’s ho-hum with the Dow up 7 and the S&P down 3.

Oil

• Oil suffers first loss in 4 sessions.
• OPEC has to blame itself for the loss.

Yesterday WTI fell 93¢ closing at $52.93 and Brent fell $1.11 settling at $55.59 marking its first losing day in 4 sessions. The impetus of the move was OPEC itself. It released its February report yesterday stating it believes 2017 global oil demand will be 95.8 million bpd and non-OPEC supply to be 63.7 million bpd. The difference is what OPEC will supply which is 32.1 million bpd. The production limit agreement reached in November is for OPEC to produce 32.5-33.0 million bpd, and this assumes 100% compliance. As you can see, even with the quotas the world is amply supplied.

This morning WTI is bouncing back up 56¢ which is just chatter. Blame it on a weaker U.S. dollar.

Courtesy of MDA Information Systems LLC

Natural Gas

• Prices continue to drift lower on warm weather forecast.
• Break the $3 level for the first time in 11 weeks.

The east coast may be recovering from a major snow storm but it did nothing to help the bulls. Yesterday natty fell another 9.0¢ closing at $2.944 and for the first time in 11 weeks below $3.00. Yesterday’s morning forecast trended warmer killing another 40-50 Bcf of demand. Today’s forecast shows some cold in the west but a major ridge in the 6-15 day time frame in the Midwest and east will bring above normal temperatures to those regions. Today’s forecast takes us through the end of February with no indications of cold, and basically the end of winter. March average temperatures increase dramatically during the month bringing with it materially lower heating degree days. It may only be the middle of February but traders are shifting their focus from the winter to the summer.

Speaking of temperatures, this weekend Chicago will be 20 to 25 degrees above normal. Youza!

This morning natty is down 0.2¢. Complete chatter.

Elsewhere

It’s Valentine’s Day so I thought I’d share some interesting facts about it.

• The most popular theory about Valentine’s Day origin is that Emperor Claudius II didn’t want Roman men to marry during wartime. Bishop Valentine went against his wishes and performed secret weddings and was subsequently jailed and executed. While in jail he wrote a note to the jailer’s daughter signing it “from your Valentine.”

• In Victorian times it was considered bad luck to sign a Valentine’s Day card.

• About 1 billion Valentine’s Day cards are exchanged each year. This makes it the second largest seasonal card sending of the year.

• If you’re single don’t despair. You can celebrate Single Awareness Day (SAD).

• XOXO. Many believer the X symbol became synonymous with the kiss in medieval times. People who couldn’t write their name signed in front of a witness with an X. The X was then kissed to show their sincerity.

• In 1537, England’s King Henry VII officially declared February 14th the holiday of St. Valentine’s Day.

• More than 35 million heart shaped boxes of chocolate will be sold for Valentine’s Day.

• 73% of people who buy flowers for Valentine’s Day are men, 27% are women.

• 15% of U.S. women send themselves flowers on Valentine’s Day.

• The red rose was the favorite flower of Venus, the Roman goddess of love.

• 189 million stems of roses are sold in the U.S. on Valentine’s Day.

• There are an average of 220,000 wedding proposals on Valentine’s Day each year.