Welcome to H2. In theory, if markets did well in H1 they tend to close the year up. The risks are now pretty clear: inflation taking off; new virus variants and mutations; a crackdown on internet monopolies; Chinese aggression in Asia; Putin's taste for hacks; and the Republicans sticking with Trump and blockage of Presidential New Deal-like programs. Already today, rock star economist Mohammed El-Erian has penned an inflation warning in the Financial Times to start Q3 right.

The new jobless levels of last week were very reassuring as they hit a post-covid and post 2001 low of 20,476.

However, the price of oil continues to worry analysts. Today Goering & Rozencwayg, an oil prediction firm, said that low inventories for non-OPEC non-US oil mean there will be a price rise. There were predictions both ways on the future price of gold, in part because of a rally in the Greenback this week. Since gold is priced in dollars a higher dollar means a higher oil price if you use a foreign currency.

Photo by Adeolu Eletu on Unsplash

A stock we used to own, sold because of my premature fear of Chinese interference with private enterprise companies, was Hollysys, which we sold preemptively. Today I got a notice from the company telling me not to support an East Caribbean Supreme Court case brought against the rail transport automation group which is registered in the Cayman Islands but chartered of course in the PRC. As I don't any longer own HOLI I have no vote but I think we are seeing the long hand of Beijing in this mailing.

Robinhood, after being fined for misleading retail investors by allowing them to do unsuitable options trading (resulting in one known suicide) today announced that it will allocate 35% of shares it gets from initial public offerings to retail investors. That means, I think, 65% of the IPO shares will go to pros or Robinhood itself. It is filing to do its own IPO which presumably will also favor retain investors

Ecowave Power Global did a $8 mn IPO. More energy news below.

The June Purchasing Managers Index was flat from that of May.

After its upmbeat results yesterday, Alimentation Couche-Tard of Quebec got a rating rise from analysts who estimate its July Q2 data will hit C$0.608, up 0.028. ANCUF runs highway convenience stores and did surprisingly well in the early months this year. We own the share which fell after its bid to buy the Carrefour chain in France was vetoed by the Paris government, despite its being francophone.

Once it was language which led to French protectionism. Now it is endemic.

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*To be frank, some of boosterism of ANCUF CEO Claude Tessier came on too strong like its expectation to double its EBITDA cash flow from 2018 by 2023 and its plans to get into dollar stores, travel retail, grocery, and quick service retail. It managed to get higher sales during the virus period but its net fell fractionally from C$563.9 mn from $575.3 mn. That is why Quebec French are unlike French French.

*Bombardier, another one, today reported that it did a $452 mn deal for 10 business jets ordered by a company it did not name. I am not sure if the money is the US or Canadian $s. BDRBF.

*Magal Security is changing its name to Senstar Tech. I can't imagine why except to not seem Israeli.

*Nutrien's target price was raised .012¢ (US) to $2.025 by the consensus today. It will do well because people need food. NTR.

Pharma news

*Elliott Mangement called for new directors at Glaxo today including a new CEO. It claimed there have been “years of disappointing performance.” GSK stock is up 1% in part because Elliott seems to be acting out of turn being a bunch of male Americans lecturing a female-headed British firm.

*Dr. Reddy's in India hit a new 52-wk high at $74.49, up 1.33%. Now it is up 2.2%. RDY.

*Swiss Roche, will seek FDA ok for its Alzheimer drug gantenerwenab a year early, this half, according to Jefferies brokerage which claims this is based on internal discussions and its H2 results. It also said RHHBY has no estimate of the bottom line cost of this move, which doesn't sound very Swiss. Roche is up 1.13% today at the open, at $47.51. RHHBY.

*Spanish Grifols was downgraded .032 eurocent for the current quarter, to eurocemts 22.8 for the current qaurter. GRFS specializes in blood plasma jabs and is big in the USA.

*Bausch Health Care cut its debt by $150 mn using funds from operations. BHC.

*Zymeworks of British Columbia is at $38.06 on renewed takeover speculation. It was picked by Martin Ferrera who lives in BC. ZYME.

*NovaCure fell 11.65%, a huge drop at the opening, to $195.98 after it revealed early data as it moved to phase II trials of its TTFields. The system uses electricity to prevent cancer cells replicating by displacing tubulin and septin which malignant cells need to grow. This is a new hope based on Israeli engineering which the Channel Islands company is pursuing. The early Hepanove trials against liver cancxer showed control over cancer cells at 76% higher with TTF than the control group, and at 91% over the control\ group at 12 weeks. The median progression-free survival time was 8.9 months The TTF system was used with sorafenib and without it. Unsectionable liver cancer is a killer and NVCR is aiming to find a way to halt its growth, a high-risk strategy.

The price drop may reflect a theory that only one cancer drug discovery company in the world can be a bid candidate. It is now down 15.61%, Being Israeli-owned it is hard to trade on Fridays and our market will be closed Monday for July 4 but I have no idea what is wrong here.

Energy

*NIO rose another 1.5% to $53.99 at the opening, again because of the risks at Tesla. It delivered a record 21,896 vehicles in China in Q2. It has now assembled its first e-drive system C vehicle last week. It is now being tested. BofA-Merrill reiterated NIO's Buy rating. Unlike most Chinese carmakers, NIO doesn't own a factory, getting one from the municipality where it is HQ'd and has only a minority shareholding. However, later on, it lost nearly 5%. China is on holiday and we are on hold next Monday.

*Cameco gained 0.31% to $19.24 after evacuating its Cigar Lake uranium mine because of fire risks. CCJ.

*Schlumberger Ltd rose 3.28% today on higher oil forecasts, hitting $33.06 at the open. SLB.

*Earthstone Energy was given a higher price by Truist analysts, $15, up from $12, ESTE.

*BP plc is up 2.6% on oil price hikes. Royal Dutch Shell B is up 2%, RDS-B.