Dow sank 357 today, decliners over advancers 6-1 & NAZ inched up 1 (on bargain hunting buying into the close. The MLP index fell a relatively mild 2+ to the 168s & the REIT index dropped 13 to the 377s. Junk bond funds continued under selling pressure & Treasuries were purchased heavily again, bringing new record low yields. Oil dropped 2+ to 45 & gold suffered a massive decline of 58, falling to 1584 (more on both below).
AMJ (Alerian MLP Index tracking fund)
![Live 24 hours gold chart [Kitco Inc.]](https://www.kitco.com/images/live/gold.gif?0.2180338269244485)
Both the Centers for Disease Control & Prevention & the Food & Drug Administration are speeding up the approval process for experimental drugs in order to obtain a treatment for the COVID-19 as quickly as possible, Trump administration adviser Larry Kudlow said. "It’s the sort of deregulatory measure that will allow great American science& biotechnology to run as fast as it can to get engaged in this thing as much as needed," even though health experts believe the risks are low, Kudlow, director of the National Economic Council, continued.vbvbAs for the impact on the US economy, Kudlow says supply chain problems are "not yet surfacing" & real-time economic numbers are "holding up nicely." He noted that weekly jobless claims remain at "rock bottom" & that the Atlanta Fed's GDPNow forecast was indicating 2.7% Q1 growth. “The president acted early, making smart moves, travel bans, quarantines where necessary, convening meetings here in the White House twice a day for many, many weeks, an extended task force," Kudlow said. "We have been all over this," he added. "And again, there's nothing more serious or higher priority than protecting the health and safety and security of the American people.”
Federal Reserve Chair Jerome Powell said Friday the central bank is monitoring the coronavirus for risks it poses to the US economy & pledged action if necessary. “The fundamentals of the U.S. economy remain strong,” Powell said. “However, the coronavirus poses evolving risks to economic activity. The Federal Reserve is closely monitoring developments and their implications for the economic outlook. We will use our tools and act as appropriate to support the economy.” The actual language in the statement differs little from previous statements Powell & other Fed officials have made. However, it comes amid a vicious decline in the stock market & worries that the coronavirus spread could jeopardize global economic growth. The market recovered some of its losses after the Powell statement broke but the Dow remained down more than 500. Markets have been clamoring for the Fed to step in with rate cuts, but Powell’s statement offered no assurances. Current pricing is for a 50 basis point cut at the FOMC's Mar meeting, with a total cut of 100 basis points expected by yearend.
Fed’s Powell says coronavirus poses ‘evolving risks,’ pledges to ‘act as appropriate’ for economy
US oil prices experienced their steepest weekly fall since 2008 as the spread of the coronavirus stokes fears of slowing global demand. Investors are increasingly worried as the virus has spread beyond its epicenter in China to more than 40 other countries. West Texas Intermediate crude settled down 4.9%, to $44.76 per barrel. US crude has fallen 16% for the week, the biggest weekly decline since 2008. The most active Brent crude contract for May was down 3.2%, at $50.75 a barrel, a 14-month low. The front-month Apr contract will expire today. New infections of the coronavirus reported around the world were now surpassing those in mainland China, where more than 2700 have died. A further 57 deaths have been recorded in other countries. Benchmark Brent crude, which fell about 2% yesterday, has shed 13% this week, putting it on track for its steepest weekly decline since 2016. Oil markets are hoping for steep supply cuts by OPEC & allies including Russia, known as OPEC+.
Oil falls nearly 5% for biggest weekly drop since 2008
Gold futures dropped nearly 5%, suffering the sharpest daily slide since 2013. Investors rushed to sell the precious metal to generate cash to cover losses in the stock market, which continued to plunge on rampant worries about the spread of COVID-19 epidemic & its effect on the global economy. Gold for Apr dropped a massive $75.80 (4.6%) to settle at $1566 an ounce, for the biggest one-day percentage loss since 2013. The most-active contract also registered a weekly slide of about 5%, the sharpest decline since 2016. The moves erased what had been a gain for the month & it was down 1.3% from the end of Jan. It is worth noting that both gold & silver rallied in the lead-up to this week's stock market plunge, with gold trading near a 7-year high & silver also gaining as investors flocked to those perceived havens, but the rally in precious metals has collapsed this week.
Gold books biggest daily slide in nearly 7 years with nearly 5% drop
General Motors (GM) will add more than 1200 new jobs at plants in Michigan to produce crossovers & Cadillac cars. The automaker announced the increase as part of plans to add shifts of production at two assembly plants near Lansing, Michigan, by Q2. The new positions include almost 400 employees to support the launch of the Cadillac CT4 & CT5 at GM’s Lansing Grand River Assembly & about 800 to add a 3rd shift to support production of the Chevrolet Traverse & Buick Enclave crossovers at its Lansing Delta Township Assembly. “We are excited to provide these opportunities in Lansing,” Phil Kienle, VP of GM North American Manufacturing & Labor Relations, said. “Our team members have proven experience in building high-quality vehicles and are well-prepared to meet the needs of our customers. This is great news for our manufacturing sites as well as the Lansing community.” GM did not comment on how many of the positions are expected to be filled by new employees versus workers who are on layoff. GM said that since 2015, it has invested more than $1B into its Lansing manufacturing operations. The Lansing Grand River plant also produces the Chevrolet Camaro as well as performance variants of the Cadillac cars. The stock fell 21¢.
If you would like to learn more about GM, click on this link:
club.ino.com/trend/analysis/stock/GM?a_aid=CD3289&a_bid=6ae5b6f7
GM adding more than 1,200 jobs at Michigan plants
This was an unusually horrible week & month. The Dow plunged (never used that word so much) 3½K this week & about 3K this month. Buying at the close trimmed the damage. It's difficult to imagine much worse. A cut in interest rates by the Fed won't be needed. The bond market has already done that work, taking Treasury yields to record lows. Try to have a good & restful week, hoping for improved conditions next week.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
Both the Centers for Disease Control & Prevention & the Food & Drug Administration are speeding up the approval process for experimental drugs in order to obtain a treatment for the COVID-19 as quickly as possible, Trump administration adviser Larry Kudlow said. "It’s the sort of deregulatory measure that will allow great American science& biotechnology to run as fast as it can to get engaged in this thing as much as needed," even though health experts believe the risks are low, Kudlow, director of the National Economic Council, continued.vbvbAs for the impact on the US economy, Kudlow says supply chain problems are "not yet surfacing" & real-time economic numbers are "holding up nicely." He noted that weekly jobless claims remain at "rock bottom" & that the Atlanta Fed's GDPNow forecast was indicating 2.7% Q1 growth. “The president acted early, making smart moves, travel bans, quarantines where necessary, convening meetings here in the White House twice a day for many, many weeks, an extended task force," Kudlow said. "We have been all over this," he added. "And again, there's nothing more serious or higher priority than protecting the health and safety and security of the American people.”
Larry Kudlow: CDC, FDA speeding up coronavirus treatment approvals
Federal Reserve Chair Jerome Powell said Friday the central bank is monitoring the coronavirus for risks it poses to the US economy & pledged action if necessary. “The fundamentals of the U.S. economy remain strong,” Powell said. “However, the coronavirus poses evolving risks to economic activity. The Federal Reserve is closely monitoring developments and their implications for the economic outlook. We will use our tools and act as appropriate to support the economy.” The actual language in the statement differs little from previous statements Powell & other Fed officials have made. However, it comes amid a vicious decline in the stock market & worries that the coronavirus spread could jeopardize global economic growth. The market recovered some of its losses after the Powell statement broke but the Dow remained down more than 500. Markets have been clamoring for the Fed to step in with rate cuts, but Powell’s statement offered no assurances. Current pricing is for a 50 basis point cut at the FOMC's Mar meeting, with a total cut of 100 basis points expected by yearend.
Fed’s Powell says coronavirus poses ‘evolving risks,’ pledges to ‘act as appropriate’ for economy
US oil prices experienced their steepest weekly fall since 2008 as the spread of the coronavirus stokes fears of slowing global demand. Investors are increasingly worried as the virus has spread beyond its epicenter in China to more than 40 other countries. West Texas Intermediate crude settled down 4.9%, to $44.76 per barrel. US crude has fallen 16% for the week, the biggest weekly decline since 2008. The most active Brent crude contract for May was down 3.2%, at $50.75 a barrel, a 14-month low. The front-month Apr contract will expire today. New infections of the coronavirus reported around the world were now surpassing those in mainland China, where more than 2700 have died. A further 57 deaths have been recorded in other countries. Benchmark Brent crude, which fell about 2% yesterday, has shed 13% this week, putting it on track for its steepest weekly decline since 2016. Oil markets are hoping for steep supply cuts by OPEC & allies including Russia, known as OPEC+.
Oil falls nearly 5% for biggest weekly drop since 2008
Gold futures dropped nearly 5%, suffering the sharpest daily slide since 2013. Investors rushed to sell the precious metal to generate cash to cover losses in the stock market, which continued to plunge on rampant worries about the spread of COVID-19 epidemic & its effect on the global economy. Gold for Apr dropped a massive $75.80 (4.6%) to settle at $1566 an ounce, for the biggest one-day percentage loss since 2013. The most-active contract also registered a weekly slide of about 5%, the sharpest decline since 2016. The moves erased what had been a gain for the month & it was down 1.3% from the end of Jan. It is worth noting that both gold & silver rallied in the lead-up to this week's stock market plunge, with gold trading near a 7-year high & silver also gaining as investors flocked to those perceived havens, but the rally in precious metals has collapsed this week.
Gold books biggest daily slide in nearly 7 years with nearly 5% drop
General Motors (GM) will add more than 1200 new jobs at plants in Michigan to produce crossovers & Cadillac cars. The automaker announced the increase as part of plans to add shifts of production at two assembly plants near Lansing, Michigan, by Q2. The new positions include almost 400 employees to support the launch of the Cadillac CT4 & CT5 at GM’s Lansing Grand River Assembly & about 800 to add a 3rd shift to support production of the Chevrolet Traverse & Buick Enclave crossovers at its Lansing Delta Township Assembly. “We are excited to provide these opportunities in Lansing,” Phil Kienle, VP of GM North American Manufacturing & Labor Relations, said. “Our team members have proven experience in building high-quality vehicles and are well-prepared to meet the needs of our customers. This is great news for our manufacturing sites as well as the Lansing community.” GM did not comment on how many of the positions are expected to be filled by new employees versus workers who are on layoff. GM said that since 2015, it has invested more than $1B into its Lansing manufacturing operations. The Lansing Grand River plant also produces the Chevrolet Camaro as well as performance variants of the Cadillac cars. The stock fell 21¢.
If you would like to learn more about GM, click on this link:
club.ino.com/trend/analysis/stock/GM?a_aid=CD3289&a_bid=6ae5b6f7
GM adding more than 1,200 jobs at Michigan plants
This was an unusually horrible week & month. The Dow plunged (never used that word so much) 3½K this week & about 3K this month. Buying at the close trimmed the damage. It's difficult to imagine much worse. A cut in interest rates by the Fed won't be needed. The bond market has already done that work, taking Treasury yields to record lows. Try to have a good & restful week, hoping for improved conditions next week.
Dow Jones Industrials
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