Dow went up 63, advancers over decliners 3-2 & NAZ crawled up 2. The MLP index lost 2+ to the 253s & the REIT index was flattish at 370 (near record highs in 2016). Junk bond funds were mixed & Treasuries hardly budged in price. Oil shot up to the high 56s & gold slid back 1 to 1343 (more below).
AMJ (Alerian MLP Index tracking fund)
![Live 24 hours gold chart [Kitco Inc.]](https://www.kitco.com/images/live/gold.gif?0.2180338269244485)
Gold futures climbed, scoring another settlement at a 10-month high, with US-China trade talks supporting haven demand for the metal & expectations for a positive outcome to the discussions also feeding the possibility of higher gold demand from China. In electronic trading, following minutes of the Federal Reserve's Jan meeting, gold futures edged lower from the settlement to $1342 an ounce. The minutes revealed that “several” officials saw the need for more interest-rate hikes if inflation came in above forecasts, while others said hikes would be needed if the economy evolved as expected. The Fed had surprised markets late last month when it abruptly put future rate moves on hold. Ahead of the Fed news, gold for Apr delivery rose $3 (0.2%) to settle at $1347 an ounce after touching a high of $1349. The most-active contract posted its highest finish in 10 mnths. US-China trade talks that resumed in DC this week after high-level discussions last week in Beijing. A deal on trade would be positive for the outlook for emerging markets, to gold's benefit, some analysts said.
Federal Reserve Vice Chair Richard Clarida said he was not even sure the economy is slowing down. “So far, we have to admit that we don’t have all the data we usually do right now. So its not even clear how much of a slowdown, if any, that we’re seeing in the economy,” Clarida said. The economic data has been delayed by the partial gov shutdown. The labor market data “is still strong” while the retail numbers have been softer, he noted. “We’re just putting that together right now,” he added. Clarida said the economy & interest-rate policy are both “in a good place.” “We can afford to be patient and decide on the next adjustment,” he said. Clarida said there are scenarios where the Fed may raise interest rates but there are other scenarios the central bank might not hike at all. Minutes of the Fed's Jan meeting show officials disagree about the future path of interest rates. Clarida said the outlook for the Chinese economy was more of a concern than the outcome of the Brexit negotiations.
The stock market showed only limited interest in the release of the Fed minutes, probably because there were no news bulletins. The message had already been absorbed by traders. The Dow is flirting with 26K & traders have their eyes on a new record less that 1K away. The success of Chinese trade talks will have a lot to do with reaching a new record.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
During their Jan meeting, Federal Reserve officials supported a patient approach to monetary policy, prompted by
concerns about the potential effects of geopolitical turmoil on the
global economy. Minutes from the Jan 29-30 meeting of the policy-setting FOMC revealed that committee members voted
to maintain the target range for the benchmark federal funds rate at
2.25-2.5%, while continuing to signal a dovish
approach to further policy moves in the year ahead, depending on the
outcome of some geopolitical concerns. Although some participants suggested that it was “not yet clear” what adjustments to
interest rates will need to be made moving forward, others argued that
rate increases “might prove necessary only if inflation outcomes were
higher than in their baseline outlook.” However,
policymakers noted that maintaining the current target range for the
federal funds rate posed “few risks” at this point. The
minutes offered a glimpse into the decision-making process from 3
weeks ago, when policymakers said they voted to keep interest rates
unchanged. Following the 2-day meeting, Fed Chair Jerome Powell said that despite relatively
strong economic data, the cumulative effect from the US-China trade
war, uncertainties surrounding Brexit & economic fallout from the
35-day partial gov shutdown in the US warranted a “patient
wait-and-see approach” regarding future rate decisions. "We
still see sustained expansion of economic activity, strong labor
conditions and inflation near 2 percent," Powell said. "But
the crosscurrents suggest a less favorable outlook.” That sentiment has been echoed by several other Fed presidents, who have
preached patience in their approach to interest rate hikes.
Fed minutes reveal uncertainty about future rate hikes
Gold futures climbed, scoring another settlement at a 10-month high, with US-China trade talks supporting haven demand for the metal & expectations for a positive outcome to the discussions also feeding the possibility of higher gold demand from China. In electronic trading, following minutes of the Federal Reserve's Jan meeting, gold futures edged lower from the settlement to $1342 an ounce. The minutes revealed that “several” officials saw the need for more interest-rate hikes if inflation came in above forecasts, while others said hikes would be needed if the economy evolved as expected. The Fed had surprised markets late last month when it abruptly put future rate moves on hold. Ahead of the Fed news, gold for Apr delivery rose $3 (0.2%) to settle at $1347 an ounce after touching a high of $1349. The most-active contract posted its highest finish in 10 mnths. US-China trade talks that resumed in DC this week after high-level discussions last week in Beijing. A deal on trade would be positive for the outlook for emerging markets, to gold's benefit, some analysts said.
Gold settles at highest since April on trade talk optimism — then retreats after Fed minutes
Federal Reserve Vice Chair Richard Clarida said he was not even sure the economy is slowing down. “So far, we have to admit that we don’t have all the data we usually do right now. So its not even clear how much of a slowdown, if any, that we’re seeing in the economy,” Clarida said. The economic data has been delayed by the partial gov shutdown. The labor market data “is still strong” while the retail numbers have been softer, he noted. “We’re just putting that together right now,” he added. Clarida said the economy & interest-rate policy are both “in a good place.” “We can afford to be patient and decide on the next adjustment,” he said. Clarida said there are scenarios where the Fed may raise interest rates but there are other scenarios the central bank might not hike at all. Minutes of the Fed's Jan meeting show officials disagree about the future path of interest rates. Clarida said the outlook for the Chinese economy was more of a concern than the outcome of the Brexit negotiations.
Fed’s Clarida says he’s not even sure the U.S. economy is slowing down
The stock market showed only limited interest in the release of the Fed minutes, probably because there were no news bulletins. The message had already been absorbed by traders. The Dow is flirting with 26K & traders have their eyes on a new record less that 1K away. The success of Chinese trade talks will have a lot to do with reaching a new record.
Dow Jones Industrials
No comments:
Post a Comment