Equities and the Economy:

• U.S. stocks closed mixed.
• Post small loss for the week.

Investors stayed on the sidelines on Friday waiting to see what Irma’s impact would be as well as whether North Korea was going to fire another missile. The Dow eked out a small gain of 13 points to finish at 21,798, the S&P 500 fell 4 points to 2,461 and the Nasdaq lost 38 points ending at 6,360. For the week all three indexes logged losses: the Dow 0.9%, the S&P 0.6% and the Nasdaq 1.2%.

There were no significant economic reports on Friday so let’s move on to today. And the week is beginning very well. While not making light of the damage Irma did over the weekend, it appears she’s not going to inflict as much damage as feared. Her hovering longer than expected on Cuba’s north coast helped to weaken her. Also, North Korea did not fire another missile. There was much speculation a missile would be fired in celebration of the country’s 69th anniversary of its founding. Both circumstances have calmed investors and with the two U.S. hurricanes for all intents and purposes forcing the Fed to delay monetary tightening and the ECB not ready to do so either, risk is being put on which this morning and is pushing world shares to record highs. The MSCI All Country World Index, which tracks about 2,400 stocks in 47 countries, hit a new high today. This is pulling our Dow up which is 121 points higher.

Oil

• Crude prices get whacked.
• Manage a weekly gain.

Crude oil prices got bludgeoned on Friday with WTI falling $1.61 settling at $47.48 and Brent losing 71¢ closing at $53.78. WTI’s Friday close was the lowest closing price for the week. However, WTI did manage to post a 0.4% weekly gain, the first weekly gain in 6 weeks. Brent rose 2% for the week. Brent prices held in better finding support from higher refinery demand in Europe and Asia.

WTI prices got hit on Friday on fears Irma might due damage to refineries along the eastern Gulf Coast. With respect to U.S. refining capacity, as of Thursday 12.8% was still down due to Harvey.

This morning WTI is up 14¢ finding minor support on the announcement by the Saudi Arabian energy minister stating he’s in talks with Venezuela and Kazakhstan to extend the current production cuts beyond March 2018.

Courtesy of MDA Information Systems LLC

Natural Gas

• Cash market weak into weekend.
• Prices get hit.

Friday’s cash market was weak on both very little demand in the Midwest and East as well as southeast markets cutting their requirements with Irma coming. On the day the October Nymex contract lost 9.1¢ closing at $2.890. The calendar 2019 through 2022 strips were little changed. For the week natty prices lost 5.9%. This morning weather forecasts have shifted materially warmer for the South, Midwest and East which will create some additional natural gas load for electric generation. This is bringing in some buyers with natty up 2.4¢. I don’t see a lot of downside for prices. Storage levels are 7% below last year at this time and are expected to be 5% below last year at the end of the injection season, which is the end of October.

Elsewhere

Audi, the car maker, announced recently they teamed up with Alta Devices, a subsidiary to build electric vehicles with a thin film of solar cells built into the overhead panoramic glass. The electricity the solar cells generate will flow into the car’s electrical system which can then be used for various needs including the air conditioning system or the seat heaters. This isn’t something that’s a decade into the future. The first prototypes of these vehicles will be built by the end of this year. In the future, almost the entire roof surface will be covered with solar cells.

Today is the 16th anniversary 9/11 attacks.