Dow sank 391 (near session lows), decliners over advancers 5-2 & NAZ dropped 95. The MLP index lost 2+ to the 227s & the REIT index fell 1+ to the 395s. Junk bond funds drifted lower & Treasuries soared, taking the yield on the 10 year Treasury down 10 basis points to under 1.64%. Oil climbed higher in the 54s & gold gained 14 to 1523 (more below).
AMJ (Alerian MLP Index tracking fund)
The US budget deficit is up 27% and getting closer to $1 trillion
Gold futures finished higher, near a 6-year peak above $1500-an-ounce set last week, as the US-China trade battle showed few signs of letting up & as demonstrations in Hong Kong heightened fears about the health of global markets & economies. Dec rose $8.70 (0.6%) to $1517 an ounce. The yellow metal ended with a minor loss on Fri but logged a 3.5% weekly rise, the strongest since Jun 21. Stock-market volatility around US-China trade tensions were credited with lifting haven assets, including gold. The potential for early elections in Italy & continued worries over protests in Hong Kong, have also provided support. Chinese authorities condemned weekend protests as “the first signs of terrorism” canceled outgoing flights from the city's airport after it was thronged by protesters.
Pres Trump's national security adviser said he told British Prime Minister Boris Johnson the administration would strongly support the UK's exit from the EU in late Oct—deal or no deal. John Bolton was the highest level US official to meet with Johnson during a visit today. Bolton held meetings with the country's new gov looking to kick-start trade & defense talks & convey the administration's support amid uncertainty about what Britain's exit from the EU.
Stocks were sold in the AM. Then in the PM, more sellers drove prices much lower. These are tough times for China where GDP growth has been slowing, partially because of the trade war. Additionally, chaos in Hong Kong is making matter worse for the country. Stock market volatility (VIX) has been at elevated levels. It reached a high above 24 last week & then recovered. But today is was up 3+, taking it over 21. As recently as mid Jul, it was traditional levels, under 15. Frightened investors, & their numbers are growing, continue to sell stocks & put that money in gold & Treasuries. Dow is down 1.5K from mid Jul & back under 26K. The outlook remains bleak.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
![Live 24 hours gold chart [Kitco Inc.]](https://www.kitco.com/images/live/gold.gif?0.2180338269244485)
The US budget deficit widened another $119.7B, good for a 27% increase over a year ago, according to
gov figures. Total outlays increased by
22.8% over last Jul as receipts grew 11.6%. For the year, receipts were
up 3% in the Oct to Jul period, totaling $2.86T, while
expenditures were at $3.73T, an 8% rise. That
brings the fiscal year deficit thru Jul to $866.8B, a little
over 1½ years after the Trump administration ushered thru a
$1.5T tax cut that the White House has vowed would pay for
itself. At this point last year, the deficit was $684B. There are 2 months left in this fiscal year, & the Treasury Dept is projecting a deficit of just over $1T. The monthly rise was in line with estimates. The
deficit increase came largely due to increased spending on health care & the military. Medicare outlays rose 11% to $66B. Defense
spending also was up $10B year over year to $53B. A 2-year budget deal that Trump negotiated with Congress earlier in
Aug likely will only add to the red ink as the spending plan
authorized increased spending on defense & domestic programs. Though
the tax cut lowered the rate corps have to pay from 36% to 21%,
tax receipts actually are up 3.2% year to date. Individual income tax
receipts have risen just shy of 1%.
The US budget deficit is up 27% and getting closer to $1 trillion
Gold futures finished higher, near a 6-year peak above $1500-an-ounce set last week, as the US-China trade battle showed few signs of letting up & as demonstrations in Hong Kong heightened fears about the health of global markets & economies. Dec rose $8.70 (0.6%) to $1517 an ounce. The yellow metal ended with a minor loss on Fri but logged a 3.5% weekly rise, the strongest since Jun 21. Stock-market volatility around US-China trade tensions were credited with lifting haven assets, including gold. The potential for early elections in Italy & continued worries over protests in Hong Kong, have also provided support. Chinese authorities condemned weekend protests as “the first signs of terrorism” canceled outgoing flights from the city's airport after it was thronged by protesters.
Gold ends higher as global angst knocks stocks, bond yields down
Pres Trump's national security adviser said he told British Prime Minister Boris Johnson the administration would strongly support the UK's exit from the EU in late Oct—deal or no deal. John Bolton was the highest level US official to meet with Johnson during a visit today. Bolton held meetings with the country's new gov looking to kick-start trade & defense talks & convey the administration's support amid uncertainty about what Britain's exit from the EU.
Bolton Says U.S. Strongly Backs Brexit Even if No EU Deal Is Reached
Stocks were sold in the AM. Then in the PM, more sellers drove prices much lower. These are tough times for China where GDP growth has been slowing, partially because of the trade war. Additionally, chaos in Hong Kong is making matter worse for the country. Stock market volatility (VIX) has been at elevated levels. It reached a high above 24 last week & then recovered. But today is was up 3+, taking it over 21. As recently as mid Jul, it was traditional levels, under 15. Frightened investors, & their numbers are growing, continue to sell stocks & put that money in gold & Treasuries. Dow is down 1.5K from mid Jul & back under 26K. The outlook remains bleak.
Dow Jones Industrials
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