Dow jumped up a massive 1167 (closing at session highs after a volatile day in trading), advancers over decliners a relatively modest 3-1 & NAZ soared 393. The MLP index jumped up 12+ to the 125s & the REIT index rose 15+ to the 382s. Junk bond funds surprisingly slid lower & Treasuries were hit with massive selling, taking the yield on the 10 Treasury up an enormous 25 basis point to 0.75%. Oil rebounded 3+ to the 34s & gold dropped 23 to 1652 (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)
Saudi Arabia isn't backing down in an oil-market war that erupted over the weekend. State-run Saudi Aramco said it will increase Apr production to 12.3M barrels per day, or 300K more than the oil giant's maximum sustained capacity of 12M. Brent crude oil rose 10% to $37.80 a barrel early today. The intl benchmark plunged by 24% to $34.36 a barrel the prior session after Saudi Arabia cut prices & said it would raise production in Apr. The drop was the biggest since the start of the 1991 Persian Gulf War. Last week, Russia rejected Saudi Arabia's call for OPEC producers & their allies to cut production by an additional 1.5M barrels a day. Moscow's decision led Riyadh to cut the price it charges for crude oil by $6-8 per barrel, sending crude oil prices plunging. Today, Russian energy minister Alexander Novak told Rossiya 24 news channel that Russia has the “potential for production growth” & could increase output by 200-300K barrels a day in the short term before eventually ramping that up to 500K barrels. However, he did not rule out making peace with OPEC, saying Moscow “may reach new agreements if needed.”
Japan has unveiled a 2nd package of measures worth about $4B in spending to cope with the impact of the coronavirus outbreak. The measures focus on support to small & mid-sized firms. The package aims to boost growth & stave off corp bankruptcies as Japan's economy suffers from a decline in tourism amid the outbreak. The gov will tap the rest of this fiscal year’s budget reserve of about ¥270B to help fund the package, Japanese Prime Minister Shinzo Abe said.
Japan unveils $4 billion aid package to help economy
Gold futures settled lower for the first time in 4 sessions as US stocks looked to rebound from their steepest one-day loss since 2008 & as gov bond yields jumped off historic lows seen after a coronavirus & crude-oil sparked plunge. Gold for Apr lost $15.40 (0.9%) to settle at $1660 an ounce, after posting a slight 0.2% gain yesterday. The rebound in risk asset prices today was attributed to expectation of additional fiscal stimulus from the US gov a day after US equities saw their largest daily decline since the last recession in 2008. Pres Trump floated the idea of payroll tax cut & a number of other measures intended to help limit the damage from the coronavirus on supply chains & local economies as a number of countries & regions have instituted lockdowns to contain or mitigate the viral outbreak.
Gold logs first loss in 4 sessions as the U.S. stock market rebounds from worst day since 2008
Oil prices surged following reports that ongoing talks between OPEC & its allies (OPEC+) remain possible. The move came despite a possible increase in production from Saudi Arabia & Russia. Speaking to reporters, Russian Energy Minister Alexander Novak said that Moscow had not ruled out measures with OPEC to stabilize oil markets. Russia's energy ministry has proposed holding a meeting with Russian oil companies tomorrow. Intl benchmark Brent crude gained $2.86 (8.3%) to settle at $37.22 per barrel, while US West Texas Intermediate futures surged 10% ($3.23) to settle at $34.36 per barrel.
Oil prices score a modest rebound after biggest drop since 1991
Steve Mnuchin, Secretary of the Treasury, reportedly said that there is bipartisan support in Congress to aid the US economy. That brought the surge in stocks prices. However, not only are words cheap, but working out details in DC doesn't go smoothly. Also of interest, market breadth was not impressive. In the meantime, airline, cruise ship lines & oil stocks (among others) have seen massive selling. The Saudi-Russia oversupply situation remains fuzzy & the virus story is far from being solved. After early buying today, the Dow sank into the red & than rallied to a massive gain in the PM. Expect another wild day tomorrow.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
Saudi Arabia isn't backing down in an oil-market war that erupted over the weekend. State-run Saudi Aramco said it will increase Apr production to 12.3M barrels per day, or 300K more than the oil giant's maximum sustained capacity of 12M. Brent crude oil rose 10% to $37.80 a barrel early today. The intl benchmark plunged by 24% to $34.36 a barrel the prior session after Saudi Arabia cut prices & said it would raise production in Apr. The drop was the biggest since the start of the 1991 Persian Gulf War. Last week, Russia rejected Saudi Arabia's call for OPEC producers & their allies to cut production by an additional 1.5M barrels a day. Moscow's decision led Riyadh to cut the price it charges for crude oil by $6-8 per barrel, sending crude oil prices plunging. Today, Russian energy minister Alexander Novak told Rossiya 24 news channel that Russia has the “potential for production growth” & could increase output by 200-300K barrels a day in the short term before eventually ramping that up to 500K barrels. However, he did not rule out making peace with OPEC, saying Moscow “may reach new agreements if needed.”
Saudi Arabia boosts output as oil war with Russia hits boiling point
Japan has unveiled a 2nd package of measures worth about $4B in spending to cope with the impact of the coronavirus outbreak. The measures focus on support to small & mid-sized firms. The package aims to boost growth & stave off corp bankruptcies as Japan's economy suffers from a decline in tourism amid the outbreak. The gov will tap the rest of this fiscal year’s budget reserve of about ¥270B to help fund the package, Japanese Prime Minister Shinzo Abe said.
Japan unveils $4 billion aid package to help economy
Gold futures settled lower for the first time in 4 sessions as US stocks looked to rebound from their steepest one-day loss since 2008 & as gov bond yields jumped off historic lows seen after a coronavirus & crude-oil sparked plunge. Gold for Apr lost $15.40 (0.9%) to settle at $1660 an ounce, after posting a slight 0.2% gain yesterday. The rebound in risk asset prices today was attributed to expectation of additional fiscal stimulus from the US gov a day after US equities saw their largest daily decline since the last recession in 2008. Pres Trump floated the idea of payroll tax cut & a number of other measures intended to help limit the damage from the coronavirus on supply chains & local economies as a number of countries & regions have instituted lockdowns to contain or mitigate the viral outbreak.
Gold logs first loss in 4 sessions as the U.S. stock market rebounds from worst day since 2008
Oil prices surged following reports that ongoing talks between OPEC & its allies (OPEC+) remain possible. The move came despite a possible increase in production from Saudi Arabia & Russia. Speaking to reporters, Russian Energy Minister Alexander Novak said that Moscow had not ruled out measures with OPEC to stabilize oil markets. Russia's energy ministry has proposed holding a meeting with Russian oil companies tomorrow. Intl benchmark Brent crude gained $2.86 (8.3%) to settle at $37.22 per barrel, while US West Texas Intermediate futures surged 10% ($3.23) to settle at $34.36 per barrel.
Oil prices score a modest rebound after biggest drop since 1991
Steve Mnuchin, Secretary of the Treasury, reportedly said that there is bipartisan support in Congress to aid the US economy. That brought the surge in stocks prices. However, not only are words cheap, but working out details in DC doesn't go smoothly. Also of interest, market breadth was not impressive. In the meantime, airline, cruise ship lines & oil stocks (among others) have seen massive selling. The Saudi-Russia oversupply situation remains fuzzy & the virus story is far from being solved. After early buying today, the Dow sank into the red & than rallied to a massive gain in the PM. Expect another wild day tomorrow.
Dow Jones Industrials
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