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Coelacanth Energy Inc. (TSXV: CEI) (‘Coelacanth’ or the ‘Company’) is pleased to announce its financial and operating results for the three months ended March 30, 2025. All dollar figures are Canadian dollars unless otherwise noted.

FINANCIAL RESULTS Three Months Ended
  March 31
($000s, except per share amounts)  2025   2024   % Change   
       
Oil and natural gas sales 2,666 3,666 (27 )
       
Cash flow from operating activities 981 3,256 (70 )
Per share – basic and diluted (1) 0.01 (100 )
       
Adjusted funds flow (used) (1) (1,440 ) 1,078 (234 )
Per share – basic and diluted (- ) (- )
       
Net loss (3,617 ) (1,201 ) 201
Per share – basic and diluted (0.01 ) (- ) 100
       
Capital expenditures (1) 25,701 1,263 1,935
       
Adjusted working capital (deficiency) (1) (25,710 ) 67,139 (138 )
       
Common shares outstanding (000s)      
Weighted average – basic and diluted 531,445 529,196
       
End of period – basic 532,202 529,392 1
End of period – fully diluted 624,877 618,165 1​

 

(1) See ‘Non-GAAP and Other Financial Measures’ section.

  Three Months Ended
OPERATING RESULTS (1) March 31
   2025   2024   % Change   
       
Daily production (2)      
Oil and condensate (bbls/d) 184 300 (39 )
Other NGLs (bbls/d) 25 37 (32 )
Oil and NGLs (bbls/d) 209 337 (38 )
Natural gas (mcf/d) 3,311 3,934 (16 )
Oil equivalent (boe/d) 761 993 (23 )
       
Oil and natural gas sales      
Oil and condensate ($/bbl) 90.21 85.30 6
Other NGLs ($/bbl) 38.01 34.79 9
Oil and NGLs ($/bbl) 84.03 79.82 5
Natural gas ($/mcf) 3.65 3.40 7
Oil equivalent ($/boe) 38.94 40.57 (4 )
       
Royalties      
Oil and NGLs ($/bbl) 15.95 20.77 (23 )
Natural gas ($/mcf) 0.64 0.51 25
Oil equivalent ($/boe) 7.18 9.08 (21 )
       
Operating expenses      
Oil and NGLs ($/bbl) 10.63 9.89 7
     Natural gas ($/mcf) 1.77 1.65 7
     Oil equivalent ($/boe) 10.63 9.89 7
       
Net transportation expenses (3)      
Oil and NGLs ($/bbl) 2.27 2.45 (7 )
Natural gas ($/mcf) 0.78 0.68 15
Oil equivalent ($/boe) 4.00 3.54 13
       
Operating netback (3)      
Oil and NGLs ($/bbl) 55.18 46.71 18
Natural gas ($/mcf) 0.46 0.56 (18 )
Oil equivalent ($/boe) 17.13 18.06 (5 )
       
Depletion and depreciation ($/boe) (14.30 ) (14.42 ) (1 )
General and administrative expenses ($/boe) (21.76 ) (13.86 ) 57
Share based compensation ($/boe) (18.46 ) (10.11 ) 83
Finance expense ($/boe) (12.86 ) (1.06 ) 1,113
Finance income ($/boe) 1.46 10.60 (86 )
Unutilized transportation ($/boe) (4.05 ) (2.49 ) 63
Net loss ($/boe) (52.84 ) (13.28 ) 298

 

(1) See ‘Oil and Gas Terms’ section.
(2) See ‘Product Types’ section.
(3) See ‘Non-GAAP and Other Financial Measures’ section.

Selected financial and operational information outlined in this news release should be read in conjunction with Coelacanth’s unaudited condensed interim financial statements and related Management’s Discussion and Analysis (‘MD&A’) for the three months ended March 31, 2025, which are available for review under the Company’s profile on SEDAR+ at www.sedarplus.ca.

OPERATIONS UPDATE

Coelacanth has reached a major milestone in its development with the completion of the Two Rivers East facility (the ‘Facility’). The Facility was completed on budget and has moved to the testing and start-up phase. The capacity of the Facility is currently 8,000 boe/d but will be expanded in Q4 2025 to 16,000 boe/d with added compression. We expect production to start flowing imminently from the 5-19 pad and ramp up through the summer. As previously released, the 5-19 pad has 9 wells that tested over 11,000 boe/d (1) that will be brought on systematically to approach the phase I capacity of the plant prior to further drilling.

Over the next few years, Coelacanth will continue with its business plan that incorporates:

  1. Systematically developing the resource using pad development and horizontal multi-frac technology to increase production and maximize cash flow and investment returns.
  2. Delineating the lands with vertical and horizontal wells to help in quantifying and understanding the commerciality of its large Montney resource base that includes up to four Montney benches over its 150 contiguous sections of land.
  3. Developing and licensing a flexible infrastructure plan that will allow for the resource to be scaled to a much larger production base.

Coelacanth has licensed additional locations on the 5-19 pad, is in the process of licensing additional development pads, delineation locations and additional infrastructure to grow beyond current plant capacity. While commodity prices and available capital will dictate the pace of execution of the business plan, we are very pleased with the results to date and look forward to reporting on new developments as they arise.

(1) See ‘Test Results and Initial Production Rates’ section for more details.

OIL AND GAS TERMS

The Company uses the following frequently recurring oil and gas industry terms in the news release:

Liquids

Bbls Barrels
Bbls/d Barrels per day
NGLs Natural gas liquids (includes condensate, pentane, butane, propane, and ethane)
Condensate Pentane and heavier hydrocarbons 

 

Natural Gas

Mcf Thousands of cubic feet
Mcf/d Thousands of cubic feet per day
MMcf/d Millions of cubic feet per day
MMbtu Million of British thermal units
MMbtu/d Million of British thermal units per day

 

Oil Equivalent

Boe Barrels of oil equivalent
Boe/d Barrels of oil equivalent per day

 

Disclosure provided herein in respect of a boe may be misleading, particularly if used in isolation. A boe conversion rate of six thousand cubic feet of natural gas to one barrel of oil equivalent has been used for the calculation of boe amounts in the news release. This boe conversion rate is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

NON-GAAP AND OTHER FINANCIAL MEASURES

This news release refers to certain measures that are not determined in accordance with IFRS (or ‘GAAP’). These non-GAAP and other financial measures do not have any standardized meaning prescribed under IFRS and therefore may not be comparable to similar measures presented by other entities. The non-GAAP and other financial measures should not be considered alternatives to, or more meaningful than, financial measures that are determined in accordance with IFRS as indicators of the Company’s performance. Management believes that the presentation of these non-GAAP and other financial measures provides useful information to shareholders and investors in understanding and evaluating the Company’s ongoing operating performance, and the measures provide increased transparency to better analyze the Company’s performance against prior periods on a comparable basis.

Non-GAAP Financial Measures

Adjusted funds flow (used)
Management uses adjusted funds flow (used) to analyze performance and considers it a key measure as it demonstrates the Company’s ability to generate the cash necessary to fund future capital investments and abandonment obligations and to repay debt, if any. Adjusted funds flow (used) is a non-GAAP financial measure and has been defined by the Company as cash flow from operating activities excluding the change in non-cash working capital related to operating activities, movements in restricted cash deposits and expenditures on decommissioning obligations. Management believes the timing of collection, payment or incurrence of these items involves a high degree of discretion and as such may not be useful for evaluating the Company’s cash flows. Adjusted funds flow (used) is reconciled from cash flow from operating activities as follows:

  Three Months Ended
  March 31
($000s)  2025   2024   % Change   
Cash flow from operating activities  981 3,256 (70 )
Add (deduct):      
Decommissioning expenditures 139 148 (6 )
Change in restricted cash deposits 424 (100 )
Change in non-cash working capital (2,560 ) (2,750 ) (7 )
Adjusted funds flow (used) (non-GAAP) (1,440 ) 1,078 (234 )

 

Net transportation expenses
Management considers net transportation expenses an important measure as it demonstrates the cost of utilized transportation related to the Company’s production. Net transportation expenses is calculated as transportation expenses less unutilized transportation and is calculated as follows:

  Three Months Ended
  March 31
($000s)  2025   2024 
Transportation expenses 551 545
Unutilized transportation (277 ) (225 )
Net transportation expenses (non-GAAP) 274 320

 

Operating netback
Management considers operating netback an important measure as it demonstrates its profitability relative to current commodity prices. Operating netback is calculated as oil and natural gas sales less royalties, operating expenses, and net transportation expenses and is calculated as follows:

  Three Months Ended
  March 31
($000s)  2025   2024 
Oil and natural gas sales 2,666 3,666
Royalties (491 ) (821 )
Operating expenses (728 ) (894 )
Net transportation expenses (274 ) (320 )
Operating netback (non-GAAP) 1,173 1,631

 

Capital expenditures
Coelacanth utilizes capital expenditures as a measure of capital investment on property, plant, and equipment, exploration and evaluation assets and property acquisitions compared to its annual budgeted capital expenditures. Capital expenditures are calculated as follows:

  Three Months Ended
  March 31
($000s)  2025   2024 
Capital expenditures – property, plant, and equipment 668 393
Capital expenditures – exploration and evaluation assets 25,033 870
Capital expenditures (non-GAAP) 25,701 1,263

 

Capital Management Measures

Adjusted working capital
Management uses adjusted working capital (deficiency) as a measure to assess the Company’s financial position. Adjusted working capital is calculated as current assets and restricted cash deposits less current liabilities, excluding the current portion of decommissioning obligations.

($000s) March 31,
2025 
  December 31, 2024   
Current assets 3,431 11,579
Less:     
Current liabilities  (36,009 ) (37,234 )
Working capital deficiency (32,578 ) (25,655 )
Add:     
Restricted cash deposits 4,900 4,900
Current portion of decommissioning obligations 1,968 2,118
Adjusted working capital deficiency (Capital management measure) (25,710 ) (18,637 )

 

Non-GAAP Financial Ratios

Adjusted Funds Flow (Used) per Share
Adjusted funds flow (used) per share is a non-GAAP financial ratio, calculated using adjusted funds flow (used) and the same weighted average basic and diluted shares used in calculating net loss per share.

Net transportation expenses per boe
The Company utilizes net transportation expenses per boe to assess the per unit cost of utilized transportation related to the Company’s production. Net transportation expenses per boe is calculated as net transportation expenses divided by total production for the applicable period.

Operating netback per boe
The Company utilizes operating netback per boe to assess the operating performance of its petroleum and natural gas assets on a per unit of production basis. Operating netback per boe is calculated as operating netback divided by total production for the applicable period.

Supplementary Financial Measures

The supplementary financial measures used in this news release (primarily average sales price per product type and certain per boe and per share figures) are either a per unit disclosure of a corresponding GAAP measure, or a component of a corresponding GAAP measure, presented in the financial statements. Supplementary financial measures that are disclosed on a per unit basis are calculated by dividing the aggregate GAAP measure (or component thereof) by the applicable unit for the period. Supplementary financial measures that are disclosed on a component basis of a corresponding GAAP measure are a granular representation of a financial statement line item and are determined in accordance with GAAP.

PRODUCT TYPES

The Company uses the following references to sales volumes in the news release:

Natural gas refers to shale gas
Oil and condensate refers to condensate and tight oil combined
Other NGLs refers to butane, propane and ethane combined
Oil and NGLs refers to tight oil and NGLs combined
Oil equivalent refers to the total oil equivalent of shale gas, tight oil, and NGLs combined, using the conversion rate of six thousand cubic feet of shale gas to one barrel of oil equivalent.

The following is a complete breakdown of sales volumes for applicable periods by specific product types of shale gas, tight oil, and NGLs:

  Three Months Ended
  March 31
Sales Volumes by Product Type  2025   2024 
     
Condensate (bbls/d)                      18                      19
Other NGLs (bbls/d)                      25                      37
NGLs (bbls/d)                      43                      56
     
Tight oil (bbls/d)                    166                    281
Condensate (bbls/d)                      18                      19
Oil and condensate (bbls/d)                    184                    300
Other NGLs (bbls/d)                      25                      37
Oil and NGLs (bbls/d)                    209                    337
     
Shale gas (mcf/d)                 3,311                 3,934
Natural gas (mcf/d)                 3,311                 3,934
     
Oil equivalent (boe/d)                    761                    993

 

TEST RESULTS AND INITIAL PRODUCTION RATES

The 5-19 Lower Montney well was production tested for 9.4 days and produced at an average rate of 377 bbl/d oil and 2,202 mcf/d gas (net of load fluid and energizing fluid) over that period which includes the initial cleanup where only load water was being recovered. At the end of the test, flowing wellhead pressure and production rates were stable.

The A5-19 Basal Montney well was production tested for 5.9 days and produced at an average rate of 117 bbl/d oil and 630 mcf/d gas (net of load fluid and energizing fluid) over that period which includes the initial cleanup where only load water was being recovered. At the end of the test, flowing wellhead pressure and production rates were stable.

The B5-19 Upper Montney well was production tested for 6.3 days and produced at an average rate of 92 bbl/d oil and 2,100 mcf/d gas (net of load fluid and energizing fluid) over that period which includes the initial cleanup where only load water was being recovered. At the end of the test, flowing wellhead pressure and production rates were stable.

The C5-19 Lower Montney well was production tested for 5.8 days and produced at an average rate of 736 bbl/d oil and 2,660 mcf/d gas (net of load fluid and energizing fluid) over that period which includes the initial cleanup where only load water was being recovered. At the end of the test, flowing wellhead pressure and production rates were stable.

The D5-19 Lower Montney well was production tested for 12.6 days and produced at an average rate of 170 bbl/d oil and 580 mcf/d gas (net of load fluid and energizing fluid) over that period which includes the initial cleanup where only load water was being recovered. At the end of the test, flowing wellhead pressure and production rates were stable.

The E5-19 Lower Montney well was production tested for 11.4 days and produced at an average rate of 312 bbl/d oil and 890 mcf/d gas (net of load fluid and energizing fluid) over that period which includes the initial cleanup where only load water was being recovered. At the end of the test, flowing wellhead pressure was stable, and production was starting to decline.

The F5-19 Lower Montney well was production tested for 4.9 days and produced at an average rate of 728 bbl/d oil and 1,607 mcf/d gas (net of load fluid and energizing fluid) over that period which includes the initial cleanup where only load water was being recovered. At the end of the test, flowing wellhead pressure and production rates were stable.

The G5-19 Lower Montney well was production tested for 7.1 days and produced at an average rate of 415 bbl/d oil and 1,489 mcf/d gas (net of load fluid and energizing fluid) over that period which includes the initial cleanup where only load water was being recovered. At the end of the test, flowing wellhead pressure and production rates were stable.

The H5-19 Lower Montney well was production tested for 8.1 days and produced at an average rate of 411 bbl/d oil and 1,166 mcf/d gas (net of load fluid and energizing fluid) over that period which includes the initial cleanup where only load water was being recovered. At the end of the test, flowing wellhead pressure was stable and production was starting to decline.

A pressure transient analysis or well-test interpretation has not been carried out on these nine wells and thus certain of the test results provided herein should be considered to be preliminary until such analysis or interpretation has been completed. Test results and initial production rates disclosed herein, particularly those short in duration, may not necessarily be indicative of long-term performance or of ultimate recovery.

Any references to peak rates, test rates, IP30, IP90, IP180 or initial production rates or declines are useful for confirming the presence of hydrocarbons, however, such rates and declines are not determinative of the rates at which such wells will continue production and decline thereafter and are not indicative of long-term performance or ultimate recovery. IP30 is defined as an average production rate over 30 consecutive days, IP90 is defined as an average production rate over 90 consecutive days and IP180 is defined as an average production rate over 180 consecutive days. Readers are cautioned not to place reliance on such rates in calculating aggregate production for the Company.

FORWARD-LOOKING INFORMATION

This document contains forward-looking statements and forward-looking information within the meaning of applicable securities laws. The use of any of the words ‘expect’, ‘anticipate’, ‘continue’, ‘estimate’, ‘may’, ‘will’, ‘should’, ‘believe’, ‘intends’, ‘forecast’, ‘plans’, ‘guidance’ and similar expressions are intended to identify forward-looking statements or information.

More particularly and without limitation, this news release contains forward-looking statements and information relating to the Company’s oil and condensate, other NGLs, and natural gas production, capital programs, and adjusted working capital. The forward-looking statements and information are based on certain key expectations and assumptions made by the Company, including expectations and assumptions relating to prevailing commodity prices and exchange rates, applicable royalty rates and tax laws, future well production rates, the performance of existing wells, the success of drilling new wells, the availability of capital to undertake planned activities, and the availability and cost of labour and services.

Although the Company believes that the expectations reflected in such forward-looking statements and information are reasonable, it can give no assurance that such expectations will prove to be correct. Since forward-looking statements and information address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, the risks associated with the oil and gas industry in general such as operational risks in development, exploration and production, delays or changes in plans with respect to exploration or development projects or capital expenditures, the uncertainty of estimates and projections relating to production rates, costs, and expenses, commodity price and exchange rate fluctuations, marketing and transportation, environmental risks, competition, the ability to access sufficient capital from internal and external sources and changes in tax, royalty, and environmental legislation. The forward-looking statements and information contained in this document are made as of the date hereof for the purpose of providing the readers with the Company’s expectations for the coming year. The forward-looking statements and information may not be appropriate for other purposes. The Company undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

Coelacanth is an oil and natural gas company, actively engaged in the acquisition, development, exploration, and production of oil and natural gas reserves in northeastern British Columbia, Canada.

Further Information

For additional information, please contact:

Coelacanth Energy Inc.
Suite 2110, 530 – 8th Avenue SW
Calgary, Alberta T2P 3S8
Phone: (403) 705-4525
www.coelacanth.ca

Mr. Robert J. Zakresky
President and Chief Executive Officer

Mr. Nolan Chicoine
Vice President, Finance and Chief Financial Officer

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/253761

News Provided by Newsfile via QuoteMedia

This post appeared first on investingnews.com

As the White House trims over 100 aides from its National Security Council staff, some former officials and analysts are asking if the smaller team can meet the demands of a fast-moving and dangerous global security environment.

Roughly half of the NSC’s 350-person team will depart in what the White House is calling a ‘right-sizing’ of a historically bureaucratic body composed largely of career diplomats – many of whom are seen as out of step with the president’s agenda.

Aides originally on loan from agencies like the State Department and the Pentagon are being sent back to their home departments. Political appointees placed on administrative leave have been told the White House will find other roles for them elsewhere in the administration.

Some former NSC officials told Fox News Digital it’s too early to tell whether the overhaul will result in a more efficient agency – or one ill-equipped to deliver timely intelligence for national security decisions.

Privately, national security sources questioned whether Secretary of State Marco Rubio, who is currently serving as interim national security advisor, might be paring back the agency to avoid internal power struggles once he returns to his original post.

Michael Allen, a former senior director at the NSC, said the staffing changes reflect President Donald Trump’s desire for direct control over key decisions.

‘I think he wants people to bring decisions to him earlier than previous presidents,’ Allen told Fox News Digital.

The NSC has charted rocky waters since it lost national security advisor Mike Waltz following the inadvertently publicized Signal chat. His deputy, Alex Wong, also recently departed the agency, and other aides who had a large impact on the administration’s early foreign policy decisions were pushed out in Friday’s restructuring.

Eric Trager, the senior director for Middle East issues who traveled with envoy Steve Witkoff for some of his Iran negotiations, is out. So is Andrew Peek, senior director for Europe and Eurasia, who helped coordinate the approach to the Russia-Ukraine conflict. 

Additionally, the restructuring will move Andy Barker, national security advisor to Vice President JD Vance, and Robert Gabriel, assistant to the president for policy, into roles serving as deputy national security advisors. 

‘This happens naturally on NSCs, the kind of stasis we saw in the Biden administration is highly untypical,’ said Victoria Coates, former deputy national security advisor to Trump. 

She noted that President Ronald Reagan had six national security advisors over two terms as president, in addition to two acting NSAs. 

‘For the president, he has legitimate concerns about the NSC from the first term, given what happened, and then, you know, there’s no sugar-coating it: the situation with Signalgate was a problem for NSA Waltz,’ Coates went on. ‘The president is taking actions to get the NSC into a condition that he would have complete confidence in it.’

With a slimmer NSC, the president is expected to lean more heavily on Rubio, CIA Director John Ratcliffe and Director of National Intelligence Tulsi Gabbard for his daily intelligence briefings.

‘One thing that makes this administration unique is that it’s the president himself and a small circle of advisors who truly matter and make decisions,’ said Brian Katulis, a former NSC official and fellow at the Middle East Institute. ‘They just don’t see the need for ongoing interagency meetings like in previous administrations.’

Katulis added that the biggest risk isn’t necessarily a lack of intelligence – but a lack of coordination.

‘Rather than gaps in intel or knowledge, what I’d worry more about is whether different agencies are singing from the same sheet of music,’ he said.

Fox News Digital has reached out to the White House for comment on Friday’s cuts and their intent. 

Others argue that the NSC has become bloated and is in need of a reset.

‘The NSC under Democratic presidents grows to 300, 400 people,’ said former Trump NSC official Alex Gray. ‘It becomes its own department.’

‘When I was there, we took it down to about 110 people doing policy – and it could probably go down another 50 and still be effective,’ he said.

‘Do you want an NSC that formulates and directs policy, or one that gives the president advice, lets him decide, and then implements it? You don’t need hundreds of people to do that.’

But the NSC is the primary agency tasked with making sure other agencies are in line with the president’s agenda. 

‘Rather than preparing options for him, they should take his direction and implement it,’ said Coates.  But, she added, ‘if you take it down too far, it’s not going to have the manpower to implement those directions from the White House into the departments and agencies which are always bigger and better funded than the NSC.’ 

‘How many heads do you have to bash together to get them to do what the president wants them to do? Our experience was in the first term that we needed a fair amount of heft on our end to get them to do stuff they didn’t want to do, like designate the IRGC as an FTO, for example,’ Coates added. 

Even with a leaner staff, the NSC remains responsible for managing critical global challenges – from Iran nuclear talks and the war in Ukraine to military competition with China.

That puts added pressure on Rubio, who will bear the blame if any crucial intelligence slips through the cracks.

‘The big issue is the national security advisor needs to make sure the president has all the information he needs to make a decision,’ Allen said.

Fox News’ Diana Stancy contributed to this report. 

This post appeared first on FOX NEWS

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Since his first day in office, President Donald Trump has mismanaged negotiations over an end to the war in Ukraine. More than 100 days later, innocent Ukrainians are still dying while the president gets played by Russian President Vladimir Putin – illustrated starkly by the barrages of drones and missiles continually aimed at Ukrainian cities as Trump posts online. 

It’s good to hear Trump finally express some frustration toward Putin and admit that his negotiating tactics aren’t working, that, as he says, Putin is ‘just tapping me along, and has to be dealt with differently.’ The reasons for this aren’t complicated. Instead of increasing his leverage over Russa, Trump offered concession after concession before talks even began. 

Getting U.S. policy right in Ukraine matters. If we allow Russia to end these negotiations as the victor, our NATO allies in Poland and the Baltics could be next. China’s President Xi Jinping will draw clear lessons from our capitulation as China plots a takeover of Taiwan. And would-be aggressors the world over will see that the international order that — while imperfect — has created stability and prosperity in much of the world has ended.  

Sadly, Trump is unlikely to listen to me, to our allies, or even to reasonable voices within his own White House and administration. My hope, though, is that he will be guided by the concepts from his own playbook — ‘The Art of the Deal’ — to secure a just peace and end this war. 

Fight back 

Donald Trump says never let yourself be pushed around — but that’s exactly what Putin is doing to him. When Trump proposed an unconditional ceasefire, Putin delayed and then shot a missile at a playground full of children. When Trump threatened additional sanctions if Putin didn’t agree to a ceasefire, Putin blew past Trump’s demands without consequence. 

Instead of continuing to get pushed around, the president should heed his own words: ‘You do your thing, you hold your ground, you stand up tall, and whatever happens, happens.’ Backing down now by threatening to walk away from talks is incentivizing Putin. This weakness invites Russian and Chinese aggression because an easy deal today undermines security for Europe, Taiwan and the United States tomorrow.  

Trump should increase sanctions — not just threaten them — and provide continued security assistance and intelligence sharing to Ukraine to sustain its war efforts against Russia. We should also reconsider Ukraine’s interest in NATO membership to apply all points of pressure on Putin.  

Use your leverage 

Russia’s economy is in real trouble with hundreds of thousands of Russians having been killed or wounded on the front lines. Putin needs this war to end. I couldn’t agree more with Trump when he wrote: ‘The worst thing you can possibly do in a deal is seem desperate to make it. That makes the other guy smell blood, and then you’re dead.’ 

Trump should not act as though Americans need this war to end more than the Russians do. While everyone wants to see an end to the bloodshed, America must approach these negotiations from a position of strength, so we can secure the best possible deal. Our economy and alliances dwarf those of Russia, which is poorer, more isolated and badly diminished by Putin’s war. 

Trump should also not give away our leverage for nothing and that includes the economic might and political unity of our European partners. Presenting a united front means implementing punishing collective sanctions that have damaged Russia’s economy and thrown sand in its war gears. Acting together with our allies undermines Putin’s agenda in Europe, inflicts the greatest pain on Russia’s economy and significantly limits Russia’s negotiating space. 

Deliver the goods 

Deeds matter more than words. As Trump wrote himself: ‘If you don’t deliver the goods, people will eventually catch on.’ He has deeply weakened decades of American leadership and credibility by abandoning our allies and the rules-based system that allowed for predictability, peace and prosperity for Americans and much of the world.  

The only way to fix America’s credibility is to be decisive and show American strength. An immediate ceasefire allows Trump to deliver on his commitment to the American people and test Russia’s willingness to seek peace. But he should make clear that a stiffer sanctions package, including secondary sanctions outlined in Republican Sen. Lindsey Graham and Democrat Sen. Richard Blumenthal’s legislation, will be imposed imminently. More than 80 senators of both parties have endorsed this bill. He must convince Putin — through bold and decisive action — that continued war is folly. Only then will there be a durable peace that restores deterrence in Europe and allows Ukraine to rebuild.  

Conclusion 

Ukraine’s signing of the mineral deal with the U.S. is a promising step, in contrast to Putin’s recent no-show in Ankara. Trump can re-start peace efforts on his own terms by imposing a stiffer sanctions package on Russia without delay. If he is indeed committed to securing Ukraine’s independent future, Trump must demonstrate that he is in the stronger position. 

But let me be clear: based on its history, the Kremlin is not interested in peace. Whether in Moldova, Georgia or Ukraine, Moscow has demonstrated strategic patience and abused others’ good faith to string out negotiations and then escalate when it sees fit. Simply put, when you give Putin an inch, he will take a mile. The only way to prevent this continued cycle is to secure a peace agreement that retains Ukraine’s national identity and that offers lasting security. Only then will President Trump prevent further aggression that threatens to draw America into future conflict.  

We are in a critical stage of negotiations and whether we get it right or wrong will reverberate for decades. 

This post appeared first on FOX NEWS

Secretary of State Marco Rubio announced Wednesday the U.S. will begin ‘aggressively’ revoking visas of Chinese students.

‘Under President Donald Trump’s leadership, the U.S. State Department will work with the Department of Homeland Security to aggressively revoke visas for Chinese students, including those with connections to the Chinese Communist Party or studying in critical fields,’ Rubio wrote in a statement. 

The State Department will also revise visa criteria to enhance scrutiny of all future visa applications from the People’s Republic of China and Hong Kong.

In March, House Republicans introduced the Stop Chinese Communist Prying by Vindicating Intellectual Safeguards in Academia Act, also known as the Stop CCP VISAs Act.

In an interview with FOX Business May 12, U.S. Sen. Ashley Moody, R-Fla., criticized providing student visas to Chinese nationals, citing a Stanford University report that uncovered the Chinese Communist Party’s alleged activity on U.S. college campuses.

The report, published by the Stanford Review, detailed an incident in which a man posing as a Stanford student targeted women at the university to gather intelligence for the Chinese Ministry of State Security.

‘How can we keep offering 300,000 student visas to Chinese nationals every year when we KNOW they are legally required to gather intelligence for the CCP? The answer is simple: we can’t,’ Moody wrote in a post on X. ‘@StanfordReview’s report on CCP espionage on campus should shock everyone and verify what I have been saying. We need to pass my STOP CCP Visas Act to protect our national security.’

Along with the new Chinese national policy, Rubio announced new visa restrictions Wednesday on foreigners ‘complicit’ in censoring Americans.

‘For too long, Americans have been fined, harassed, and even charged by foreign authorities for exercising their free speech rights,’ Rubio wrote in a post. ‘Today, I am announcing a new visa restriction policy that will apply to foreign officials and persons who are complicit in censoring Americans.

‘Free speech is essential to the American way of life – a birthright over which foreign governments have no authority.’

The White House did not immediately respond to Fox News Digital’s request for comment.

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House Republicans are mounting a push to start a new select committee focused on investigating the Biden administration for allegedly ‘covering up’ signs of the 82-year-old former president’s decline.

Rep. Buddy Carter, R-Ga., is introducing legislation Thursday that would establish a panel of congressional investigators to ‘investigate and report upon the facts of President Joseph Robinette Biden, Jr.’s cognitive and physical health decline and the potential concealment of information from the American public,’ according to bill text obtained by Fox News Digital.

As of Thursday morning, the resolution had four co-sponsors in addition to Carter: Reps. Mark Alford, R-Mo., John Rose, R-Tenn., Derrick Van Orden, R-Wis., and Barry Moore, R-Ala.

Republicans have unleashed a tidal wave of scrutiny on the previous Democrat White House as new reports – as well as old concerns previously dismissed by mainstream media – surface about Biden’s mental state while in office and what lengths those closest to him took to allegedly hide it from others. 

Carter’s text calls to investigate former Vice President Kamala Harris and former first lady Jill Biden as well as whoever took part in keeping the audio tapes of Special Counsel Robert Hur’s interview with Biden from the public.

The select committee would also focus on whether Biden allies ‘concealed’ his prostate cancer diagnosis before it was announced publicly last week. 

Biden’s spokesperson denied prior knowledge of the diagnosis in a statement to the New York Times.

The resolution also specifically called for a probe into the use of the autopen in Biden’s White House to sign meaningful legislation.

‘This is potentially the biggest political scandal of our lifetime, and the American people deserve to know the truth about who was really running the White House during Biden’s tenure as president,’ Carter told Fox News Digital of his legislation.

‘From using the autopen to pardon his own family members to likely concealing a cancer diagnosis, our government must restore trust with the public by fully investigating the former administration’s lies and getting to the bottom of one of the most consequential coverups in history.’

Carter, who is currently running for Senate in Georgia, was among several Republicans who demanded Biden take a cognitive test last year.

‘The American people can no longer be left to wonder about their safety and security because of the President’s deteriorating mental state,’ Carter wrote in a June 2024 letter to the White House.

His new resolution comes on the heels of House Oversight Committee Chair James Comer, R-Ky., opening his own investigation into revelations surrounding Biden’s cognitive decline.

Comer spent much of the last Congress investigating whether Biden and his family unjustly profited from foreign cash.

The House Oversight chair sent letters to former senior White House aides, including Biden’s doctor, Kevin O’Connor, announcing a probe into ‘the role of former senior Biden White House officials in possibly usurping authority from former President Joe Biden and the ramifications of a White House staff intent on hiding his rapidly worsening mental and physical faculties.’

Meanwhile, first-term Rep. Jimmy Patronis, R-Fla., called for a similar select committee on Wednesday.

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House Republicans are celebrating Medicaid reform in the One Big Beautiful Bill Act, which the House GOP says eliminates waste, fraud and abuse to deliver for Americans who need coverage most. 

Meanwhile, Democrats have railed against possible Medicaid cuts since President Donald Trump was elected in November. Now that his ‘big, beautiful bill’ has passed in the House of Representatives, Democrats are defining Medicaid cuts as a driving issue ahead of competitive midterm elections in 2026. 

Republicans say there is more to the story. 

‘The One, Big Beautiful Bill puts Americans first. We’re securing the border. We’re protecting benefits for the most vulnerable. We are investing in American manufacturing. We’re investing in our own energy production,’ Rep. Erin Houchin, R-Ind., told Fox News Digital in an exclusive interview. 

‘The Democrats have been focusing on this specific line of attack that 13.7 million Americans are going to lose their health care, and that’s just blatantly false.’

The Congressional Budget Office (CBO), a nonpartisan analysis for the U.S. Congress, estimates that 8.6 million people in the United States will lose health insurance by 2034 through the One Big Beautiful Bill Act’s Medicaid reform. 

‘Five million of those people are receiving a tax credit under the Affordable Care Act that was passed by the Democrats with a sunset date that was implemented by the Democrats. We’re simply allowing the sunset date to expire as the Democrats originally intended,’ Houchin said. 

CBO estimates that 13.7 million Americans will lose coverage by 2034, which also includes the 5 million Americans who were already set to lose coverage. A number of Democrats have already deployed the figure in campaign messages rejecting Trump’s ‘big, beautiful bill’ passing in the House.

‘I don’t trust the CBO score, nor should the American people, because it’s been proven again and again to be wildly off,’ added Houchin, who served on three major committees leading budget markup, including the House Rules, Budget and Energy and Commerce committees. 

The American Accountability Foundation, a conservative government research nonprofit, found that of the 32 staff members on CBO’s Health Analysis Division, 26 of them have ‘clearly’ verified liberal partisan biases, as a Democrat donor, registered Democrat or a Democratic primary voter, as Fox News Digital reported this month. 

The One Big Beautiful Bill Act does not cut Medicaid for the most vulnerable, according to Houchin. Instead, she says targeting waste, fraud and abuse in the Medicaid program cuts benefits to illegal immigrants, those ineligible to receive benefits who are currently receiving benefits, duplicate enrollees in one or more states and those who are able-bodied but are choosing not to work. 

‘If you have to think about the four things that we’re doing in Medicaid to strengthen it, we’re removing anybody that is illegal, ineligible or duplicate, and we’re ensuring that able-bodied adults, on the expansion population, have a very modest work requirement, in exchange for receiving benefits. Those things are overwhelmingly supported by the American people, yet the Democrats continue to lie about what this bill is actually doing,’ Houchin said. 

Republicans say they are cleaning up the program to ensure working families and the most vulnerable Americans can rely on the program for generations to come. 

‘What we’re trying to do is protect precious Medicaid dollars for those who need it most,’ Houchin said. ‘That’s what we’re doing. No one in the traditional Medicaid population needs to worry. And even if you’re in the able-body expansion population, there are many opportunities to comply to participate in Medicaid.’

However, Democrats have already designated Medicaid cuts as a defining issue in 2026. 

‘House Republicans’ giant tax scam will kick millions of people off their health insurance,’ Democratic Congressional Campaign Committee (DCCC) spokesperson Viet Shelton told Fox News Digital. ‘It is fact. Independent analysts say it. Health care professionals say it. Hell, even Republican senators say so. Their saying anything to the contrary is just them trying to protect their already in danger majority.’

After weeks of negotiating through budget reconciliation, House Republicans finally reached a consensus and passed the One Big Beautiful Bill Act last week. The bill passed just 215 to 214, and all Democrats voted against it. Republicans’ slim majority managed to deliver a legislative win for Trump. 

However, the ‘big, beautiful’ fight is far from over as the Senate is tasked with drafting their own version of the bill. Senate Republicans have indicated they do not support the bill in its current form. 

‘I don’t want to see rural hospitals close their doors because funding got cut. I also don’t like the idea of a hidden tax on the working poor. That’s why I’m a NO on this House bill in its current form,’ Sen. Josh Hawley, R-Mo., said. 

The sweeping, multitrillion-dollar legislation advances Trump’s agenda on taxes, immigration, energy, defense and the national debt. The bill includes Trump’s key campaign promises, including no tax on tips and overtime, and it seeks to permanently extend his 2017 Tax Cuts and Jobs Act. 

‘By passing the largest cut to Medicaid in history, Republicans are ripping away health care from millions of Americans and levying a de facto hidden tax on working-class families,’ DCCC Chair Suzan DelBene said in a statement after the bill passed. ‘Now that vulnerable Republicans are on the record voting for it, this betrayal of the American people will cost them their jobs in the midterms and Republicans the House Majority come 2026.’

While Democrats target vulnerable Republicans for supporting Medicaid reform in Trump’s ‘big, beautiful bill,’ Republicans are taking aim at Democrats for voting against the bill’s tax cuts.

‘House Democrats voted for the largest tax increase in generations while giving taxpayer-funded freebies to illegal immigrants. The NRCC will make sure voters don’t forget how they betrayed working families,’ National Republican Campaign Committee (NRCC) spokesman Mike Marinella said in a statement to Fox News Digital. 

As House members return to their home states and communicate with constituents during the congressional recess, the NRCC is encouraging House Republicans to go on the offense on Medicaid reform. 

‘We’re encouraging all of our caucus, our conference members to continue to communicate with the local and national media to reiterate what we know to be true about this One Big Beautiful Bill,’ Houchin said. 

‘It puts Americans first and will ensure that these programs will be around for the next generation, because we’re not wasting any tax dollars, any precious benefits on people who are illegal, ineligible, enrolled in multiple states or are able-bodied and could be working. These programs were designed for our most vulnerable Americans, and the One Big Beautiful Bill protects benefits for those people.’

Fox News Digital’s Elizabeth Elkind and Louis Casiano contributed to this report. 

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23andMe on Tuesday announced it will voluntarily delist from the Nasdaq and de-register with the U.S. Securities and Exchange Commission, according to a release.

The move comes after Regeneron Pharmaceuticals said earlier this month that it will acquire “substantially all” of 23andMe’s assets for $256 million.

The drugmaker came out on top following a bankruptcy auction for 23andMe, a once high-flying genetic testing company that filed for Chapter 11 bankruptcy protection in March.

23andMe said it will file a Form 25 Notification of Delisting with the SEC on or around June 6, which would subsequently remove the stock from listing and registering with the Nasdaq.

The company said the Nasdaq had originally informed the company that a Form 25 would be filed in March, but since the exchange has not yet submitted the filing, 23andMe is doing so voluntarily.

23andMe exploded into the mainstream because of its at-home DNA testing kits that allowed customers to examine their genetic profiles. At its peak, the company was valued at around $6 billion.

But after going public via a merger with a special purpose acquisition company in 2021, the company struggled to generate recurring revenue and stand up viable research or therapeutics businesses.

Regeneron’s deal is still subject to approval by the U.S. Bankruptcy Court for the Eastern District of Missouri. Pending approval, it’s expected to close in the third quarter of this year.

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Dick’s Sporting Goods said Wednesday it’s standing by its full-year guidance, which includes the expected impact from all tariffs currently in effect.

The sporting goods giant said it’s expecting earnings per share to be between $13.80 and $14.40 in fiscal 2025 — in line with the $14.29 that analysts had expected, according to LSEG.

It’s projecting revenue to be between $13.6 billion and $13.9 billion, which is also in line with expectations of $13.9 billion, according to LSEG.

“We are reaffirming our 2025 outlook, which reflects our strong start to the year and confidence in our strategies and operational strength while still acknowledging the dynamic macroeconomic environment,” CEO Lauren Hobart said in a news release. “Our performance demonstrates the momentum and strength of our long-term strategies and the consistency of our execution.”

Here’s how the company performed in its first fiscal quarter compared with what Wall Street was anticipating, based on a survey of analysts by LSEG:

The company’s reported net income for the three-month period that ended May 3 was $264 million, or $3.24 per share, compared with $275 million, or $3.30 per share, a year earlier. Excluding one-time items related to its acquisition of Foot Locker, Dick’s posted earnings per share of $3.37.

Sales rose to $3.17 billion, up about 5% from $3.02 billion a year earlier.

For most investors, Dick’s results won’t come as a surprise because it preannounced some of its numbers about two weeks ago when it unveiled plans to acquire its longtime rival Foot Locker for $2.4 billion. So far, Dick’s has seen a mix of reactions to the proposed acquisition.

On one hand, Dick’s deal for Foot Locker will allow it to enter international markets for the first time and reach a customer that’s crucial to the sneaker market and doesn’t typically shop in the retailer’s stores. On the other hand, Dick’s is acquiring a business that’s been struggling for years and some aren’t sure needs to exist due to its overlap with other wholesalers and the rise of brands selling directly to consumers.

While shares of Foot Locker initially soared more than 80% after the deal was announced, shares of Dick’s fell about 15%.

The transaction is expected to close in the second half of fiscal 2025 and, for now, Dick’s outlook doesn’t include acquisition-related costs or results from the acquisition.

In the first full fiscal year post-close, Dick’s expects the transaction to be accretive to earnings and deliver between $100 million and $125 million in cost synergies.

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Macy’s cut its full-year profit guidance on Wednesday even as it beat Wall Street’s quarterly earnings expectations, as the retailer’s CEO said it will hike prices of certain items to offset tariffs.

In a news release, the department store operator said it reduced its earnings outlook because of higher tariffs, more promotions and “some moderation” in discretionary spending. Macy’s stuck by its full-year sales forecast, however.

For fiscal 2025, Macy’s now expects adjusted earnings per share of $1.60 to $2, down from its previous forecast of $2.05 to $2.25. It reaffirmed its full-year sales guidance of between $21 billion and $21.4 billion, which would be a decline from $22.29 billion in the most recent full year.

In an interview with CNBC, CEO Tony Spring said about 15 cents to 40 cents per share of the guidance cut is due to tariffs. He said about 20% of the company’s merchandise comes from China.

Macy’s will raise some prices and stop carrying certain items to mitigate the hit from tariffs, he added.

“You’re dealing with it on both the demand side as well as the increased cost side,” he said. “And so navigating that, we have a series of different scenarios to try to figure out kind of what will be the reality, and we want our guidance to reflect the flexibility of that uncertainty, so that we can react in real time to how we serve or better serve the consumer.”

Spring said the company will be “surgical” with price changes.

“It’s not a one-size-fits-all kind of approach,” he said. “There are going to be items that are the same price as they were a year ago. There is going to be, selectively, items that may be more expensive, and there are items that we might not carry because the pricing doesn’t merit the quality or the perceived value by the consumer.”

Here’s how Macy’s did during its fiscal first quarter, compared with what Wall Street was anticipating, based on a survey of analysts by LSEG:

In the three-month period that ended May 3, the company’s net income was $38 million, or 13 cents per share, compared with $62 million, or 22 cents per share, in the year-ago period. Sales dropped from $4.85 billion in the year-ago quarter. Excluding some one-time charges including restructuring charges, adjusted earnings per share were 16 cents.

The company’s shares were down more than 2% in early trading on Wednesday.

Economic uncertainty — including President Donald Trump’s on-again, off-again tariff announcements — has complicated Macy’s turnaround plans. The New York City-based legacy retailer is more than a year into a three-year effort to become a smaller, but healthier business. It’s shuttering weaker stores and investing in stronger parts of the company, including luxury department store Bloomingdale’s and beauty chain Bluemercury. It has also tried to improve the customer experience, including by speeding up online deliveries and adding staff to stores.

Spring told analysts on the earnings call that the tariff impact on Macy’s outlook includes the additional costs of inventory previously imported under the 145% China tariffs, which have since dropped to 30%. He said the outlook does not include a potential increase in tariffs on the European Union or any other U.S. trading partner.

Trump recently threatened to implement, and then delayed, a 50% tariff on the EU.

Macy’s sells a mix of national band private brands, which are sold exclusively at its stores and on its website. Spring told CNBC that the company has reduced the share of its private brands that comes from China to about 27% — a drop from 32% last year and more than 50% before the Covid pandemic.

CFO Adrian Mitchell said on the company’s earnings call that Macy’s has taken action to blunt the impact of tariffs on national brands it sells, too. He said the company has renegotiated orders with vendors, canceled some orders and delayed others.

“We’ve been able to gain some vendor discounts, which has been helpful to us, but we’re absorbing some of that price as well,” he said.

And in some cases, Macy’s is keeping prices the same despite higher costs to appeal to value-conscious customers and gain market share from competitors, Mitchell added.

Spring said on the company’s earnings call on Wednesday that Macy’s sales were stronger in March and April compared to February, attributing some of that to improving weather. So far, sales trends in the second quarter have been above those in March and April, he added.

Macy’s plans to close about 150 underperforming namesake stores across the country by early 2027.

In the fiscal first quarter, Macy’s namesake brand remained its weakest. Comparable sales across Macy’s owned and licensed business, plus its online marketplace, declined 2.1% year over year.

When Macy’s took out the stores that it plans to shutter, however, trends looked slightly better. Comparable sales of its go-forward business, including its owned and licensed business and online marketplace, declined 1.9%

On the other hand, comparable sales at Bloomingdale’s rose 3.8% year over year, including its owned, licensed and marketplace businesses. Comparable sales at Bluemercury climbed 1.5% year over year.

To try to turn its namesake stores around, Macy’s has invested in 50 locations — dubbed the “First 50” — with more staffing, sharper displays and changes to its mix of merchandise. It has expanded that initiative to 75 additional stores, bringing the total to 125 locations that have gotten increased attention. That’s a little over a third of the 350 namesake locations that Macy’s plans to keep open.

Those 125 locations performed better than the overall Macy’s brand. Comparable sales among those revamped stores owned and licensed by Macy’s were down 0.8% compared with the year-ago period.

On Macy’s earnings call in March — before Trump made several sudden tariff moves that baffled companies and investors — Spring said the company’s guidance “assumes a certain level of uncertainty” about the economic outlook. He said even Macy’s affluent customer “is just as uncertain and as confused and concerned by what’s transpiring.”

Earlier this spring, Macy’s announced a few key leadership changes — including a new chief financial officer. Macy’s new CFO, Thomas Edwards, will begin on June 22. He previously served as the chief financial officer and chief operating officer of Capri Holdings, the parent company of Michael Kors. He will succeed Mitchell, who is leaving Macy’s.

As of Tuesday’s close, Macy’s shares are down about 29% so far this year. That trails the S&P 500′s nearly 1% gains during the same period. Macy’s stock closed on Tuesday at $12.04 per share, bringing the retailer’s market value to $3.35 billion.

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Technology Back in Top-5

Last week’s market decline of 2-2.5% (depending on the index) has led to some notable shifts in sector performance and rankings.

This pullback, coming after a strong rally, is changing the order of highs and lows on the weekly chart — a particularly significant development, at least for me.

Let’s dive into the details and see what’s flying around in the market.

The composition of the top five sectors has seen some notable changes. Here’s how it stands now:

The big surprise here is Technology making its way into the top five, displacing Consumer Staples (now at #6). This shift suggests a gradual move from a more defensive positioning to sectors that are more cyclical and economically sensitive.

Another eye-catching move comes from Consumer Discretionary, jumping from #10 to #7 — a significant leap, albeit still in the bottom half of the ranking. Real Estate and Materials saw minor shifts, while Energy dropped to #10 and Health Care remains at #11.

  1. (1) Industrials – (XLI)
  2. (4) Communication Services – (XLC)*
  3. (3) Utilities – (XLU)
  4. (2) Financials – (XLF)*
  5. (6) Technology – (XLK)*
  6. (5) Consumer Staples – (XLP)*
  7. (10) Consumer Discretionary – (XLY)*
  8. (7) Real-Estate – (XLRE)*
  9. (8) Materials – (XLB)*
  10. (9) Energy – (XLE)*
  11. (11) Healthcare – (XLV)

Weekly/Daily RRG Analysis

The weekly Relative Rotation Graph (RRG) provides some interesting insights:

  • Utilities maintains very high readings, but Consumer Staples (highest on RS-Ratio ranking) is likely to be pushed down by weak daily chart readings.
  • Industrials continues to push further into the leading quadrant with stable momentum.
  • Financials and Communication Services are inside the weakening quadrant but have room to curl back towards leading.
  • Technology, despite having the second-lowest RS-Ratio reading, is rapidly improving with a strong RS-Momentum heading over recent weeks.

Remember, the ranking combines daily and weekly readings.

Technology’s high daily chart reading is propelling it into the top five, while Consumer Staples’ weak daily reading is pushing it out.

Industrials: The Leader Holding Strong

XLI is now pushing against its all-time high, just below 145. After two weeks of attempts, last week’s slight market decline confirms that this resistance level has worked.

We’re now looking for where any potential decline might stop and form a new low. The gap area from two weeks ago seems to be a good support area to watch.

The relative strength line breaking out of its consolidation formation continues to drag the RRG lines higher. XLI, for good reason, remains the strongest sector at the moment.

Communication Services: Stable Relative Uptrend

XLC is continuing its move higher with remarkable stability. The uptrend in the RS line is still valid, currently testing the lower boundary of the rising channel.

Due to the lack of upward relative momentum in recent weeks, both RRG lines are now pointing lower.

However, the RS-Ratio line remains well above 100, keeping the XLC tail on the right-hand side of the RRG.

Utilities: Testing Resistance

XLU is pushing against overhead resistance but has yet to manage a decisive break higher.

With defensive sectors under pressure, it’s questionable whether this breakout will happen in the short term.

The RS line versus SPY is dropping back into its trading range, unable to break away decisively. This drop is causing the RS-Momentum line to roll over and start pointing lower.

It’s the recent strength in relative strength that’s keeping Utilities inside the leading quadrant for now.

Financials: At a Crossroads

The Financial sector seems to be respecting the old rising support line as resistance, with the market dropping off that line last week and now trading around $50.

This move is affecting the relative strength line, which has returned to the lower boundary of the rising channel — a level that needs to hold to maintain a positive outlook for XLF.

The RS-Ratio line is stable around 102.50, high enough to keep Financials on the right-hand side of the graph.

The RS-Momentum line has just dropped below 100, positioning the XLF tail inside the weakening quadrant, but with enough room to curl back up before hitting lagging.

Technology: The Week’s Winner

XLK saw a significant jump two weeks ago and has since returned to test the old resistance area as support. If last week’s decline continues, there’s a bit more room to the downside — $220 seems to be a good level to watch for support, marking the bottom of the gap range from two weeks ago.

The jump has pushed the relative strength line above its falling resistance line, a good sign that seems to be breaking the relative downtrend in place since mid-last year.

This is changing the characteristics of the relative strength move for the Technology sector.

For now, it has only pushed the RS-Momentum line above 100, moving XLK into the improving quadrant on the weekly RRG, but it’s already starting to drag the RS-Ratio line higher.

Portfolio Performance

We’re clawing back some of the losses from recent weeks. The underperformance of almost 6% last week has now shrunk to 4.6%. Still behind the benchmark, but closing in again and narrowing the gap.

It’s a long-term game, so we keep pushing forward. So far, nothing out of the ordinary. Let’s wait and see whether we’ve seen the low in underperformance and how long it will take to return to SPY’s performance since inception.

#StayAlert –Julius