Dow sank an enormous 2999, the NYSE had only 138 gainers & NAZ tumbled 970. The MLP index dropped 15 to the 92s & the REIT index plunged a whopping 63 to the 288s (down 1/3 from its record high in the last month). Junk bond funds saw massive selling & Treasuries rose & yields plunged. Oil sank 3 to the 28s & gold dropped 21 to 1495 (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)
Pres Trump's chief economic adviser Larry Kudlow vowed the White House will do "whatever it takes" to mitigate the coronavirus pandemic and protect the U.S. economy as American life came screeching to a halt. "We will reach for every available way to mitigate and stem both the health side and the economic side," Kudlow said. His comments came as global confirmed cases of COVID-19, the disease caused by the novel coronavirus, neared 175K & deaths topped 6500. In the US, there are 3813 reported cases & 69 deaths, according to a database run by Johns Hopkins University. Despite a drastic emergency rate cut by the Federal Reserve, an $8.3B & package signed last week & efforts by the Trump administration & House Dems to pass another stimulus bill, stocks were down sharply today, raising concerns that the US central bank's most dramatic move since the 2008 financial crisis won't be enough to quell panic as the coronavirus gains foothold in the US. White House officials have signaled that they are working to bring forward a 3rd economic relief bill aimed at helping industries hit by the coronavirus pandemic. "We will use whatever powers there are from the federal government and the executive branch and the legislative branch," Kudlow added. A slew of companies in the US & the world take drastic measures to slow the spread of the disease, including temporarily shutting down. The country's cruise lines are suspending operations for a month, while the airline industry has suffered as planes idle on the runway due to global travel bans. One possible option, Kudlow said, is providing a bailout to the airline industry, which has been forced to cancel thousands of flights. "It’s absolutely a key topic of discussion here," Kudlow said. "It’ll be up to Congress as well." Kudlow also floated the possibility of temporarily eliminating the payroll tax, an idea frequently touted by Pres Trump. Currently, all employees and employers pay a 6.2% payroll tax on wages capped out at $137.7K. Right now, an employee earning $50K per year would pay $3100 in payroll taxes. That money goes toward specific programs like Social Security, health care, unemployment compensation & workers' compensation. Workers also pay a Medicare tax of 1.45%. Sources previously said there has been consideration of eliminating it for 3 months, thru the fall, thru the calendar year or permanently\. "The payroll tax holiday is a very powerful weapon. It allows businesses and workers to keep more of what they earn," Kudlow said. "And it’ll provide a lot of cash flow to liquidity. These measures will, I think, help mitigate the economic risks and challenges in front of us."
The Federal Reserve yesterday slashed interest rates by a full percentage point to near 0 & said it would buy $700B in Treasury securities, an aggressive step to insulate the US economy from the coronavirus pandemic. “The coronavirus outbreak has harmed communities and disrupted economic activity in many countries, including the United States,” the Federal Open Market Committee said. “The Federal Reserve is prepared to use its full range of tools to support the flow of credit to households and businesses.” The benchmark federal fund rate is now at 0-0.25%, down from 1-1.25%. The cut essentially brings the nation's interest rate to zero -- something that Pres Trump has repeatedly pressed for over the past year. The historically low interest rates, which not been at this level since the 2008 financial crisis, are expected to remain until the economy recovers. "The Committee expects to maintain this target range until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals," the Fed said. The Fed also said that it will buy at least $500B in Treasury securities & $200B in mortgage-backed securities over the coming months, a program known as "quantitative easing." Earlier this month, Powell announced an emergency 50-basis-point cut to the benchmark federal funds rate, sending it to a range of 1-1.25%. It marked the first time since the financial crisis that the Fed has reduced its key rate outside of scheduled policy-setting meetings.
Oil prices slid 10% as the acceleration in coronavirus cases worldwide, which is bringing travel & business to a standstill, further dents global demand for crude. US West Texas Intermediate (WTI) crude dropped $3.03 (9.5%) to settle at $28.70 per barrel. Earlier WTI fell to a session low of $28.03 per barrel. Intl benchmark Brent crude fell 11% ($3.73) to trade at $30.11 & earlier it traded as low as $29.52, its lowest level in 4 years. Oil continues to be hit on both the demand & supply side. The coronavirus outbreak has led to softer demand for crude as people cut back on travel, for example, while a breakdown in OPEC talks means there could soon be a supply glut as Saudi Arabia gets set to ramp up production to a record 13M barrels per day. The move lower comes even after Pres Trump said Fri that the Dept of Energy would purchase crude oil for the SPR in a bid to prop up prices. “Based on the price of oil, I’ve also instructed the secretary of Energy to purchase at a very good price large quantities of crude oil for storage in the U.S. strategic reserve,” Trump said Fri as he also declared a state of emergency. “We’re going to fill it right up to the top, saving the American taxpayer billions and billions of dollars, helping our oil industry [and furthering] that wonderful goal — which we’ve achieved, which nobody thought was possible — of energy independence,” he added. The gov could begin purchasing oil in 2 weeks.
Oil drops nearly 10%, breaking below $29 as demand evaporates
The pan-European Stoxx 600 provisionally closed 5.1% lower, off lows hit earlier in the session. Travel & leisure stocks plummeted around 10% to lead losses as all sectors & major bourses ended the day in the red. Spain's IBEX was around 8.3% in the red & Italy's FTSE MIB was down over 6%. France's CAC 40 provisionally ended 5.9% lower. Germany's XETRA DAX closed 5.3% in the red as the UK's FTSE 100 finished 4.7% lower. Markets spent the day reacting to the shutdown taking place on the continent. Spain has imposed a 15-day nationwide lockdown, banning its 46M citizens from all-non essential movement. The country imposed the state of emergency decree, as it confirmed the highest number of COVID-19 cases in Europe, after Italy. France & Germany have already closed large parts of their economies & fortified borders as they step up their efforts to contain the spread of the coronavirus. Meanwhile, Ursula von der Leyen, European Commission pres, proposed banning most foreign visitors into Europe for 30 days. The UK gov is now facing growing calls to take more drastic measures. Markets were also reacting to the US Federal Reserve's surprise move yesterday; the Fed slashed its benchmark interest rate to zero & launched a massive quantitative easing program in an emergency move.
European stocks close down 5%, airline stocks tank as EU proposes travel restrictions
Gold futures fell to settle at their lowest since Dec & silver futures finished at their worst level in over a decade, as the Federal Reserve’s emergency decision to slash interest rates failed to stem losses in the stock market, sending traders scrambling for cash. Prices for the precious metals, however, managed to significantly cut their losses by the settlement, as short covering kicked in. Gold had dropped more than 4% to hit the day's low. Gold for Apr delivery lost $30 (2%) to settle at $1486 an ounce—the lowest finish for a most-active contract since Dec 20. Prices had dropped by more than 4% from Fri's settlement to touch an intraday low at $1450. Gold rallied late yesterday after the Fed, in a surprise decision last evening, slashed its benchmark interest rate nearly to 0 & implemented a bond-buying program, known as quantitative easing, of at least $700B. But gains soon gave way to losses as equities failed to find support in the wake of the move. While looser monetary policy & pressure on assets perceived as risky, like stocks, would both normally be seen as a positive for gold, the metal has seen weakness in recent sessions on apparent forced liquidation that has seen leveraged investors dump positions en masse.
Gold ends at lowest since December; silver marks worst settlement in over a decade
Stocks opened with must be the biggest drop in history, followed by a feeble attempt at a rally in the next hour. Sellers returned, dragging the averages' levels below the opening. The economy is in deep trouble even with all the money the gov & Fed are throwing around. There is one silver lining (if you can call it that). Being stuck at home, investors have time to look for quality stocks with good yields. The Dividend Aristocrats (there are more than 60) are being hit with selling which raises those yields. Some have very attractive yields (above 3% & even 4%). While more selling is in the cards, the bear market will end, giving an opportunity to lock up high yields. Take a breather tonight & try to relax from this brutal time.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
Pres Trump's chief economic adviser Larry Kudlow vowed the White House will do "whatever it takes" to mitigate the coronavirus pandemic and protect the U.S. economy as American life came screeching to a halt. "We will reach for every available way to mitigate and stem both the health side and the economic side," Kudlow said. His comments came as global confirmed cases of COVID-19, the disease caused by the novel coronavirus, neared 175K & deaths topped 6500. In the US, there are 3813 reported cases & 69 deaths, according to a database run by Johns Hopkins University. Despite a drastic emergency rate cut by the Federal Reserve, an $8.3B & package signed last week & efforts by the Trump administration & House Dems to pass another stimulus bill, stocks were down sharply today, raising concerns that the US central bank's most dramatic move since the 2008 financial crisis won't be enough to quell panic as the coronavirus gains foothold in the US. White House officials have signaled that they are working to bring forward a 3rd economic relief bill aimed at helping industries hit by the coronavirus pandemic. "We will use whatever powers there are from the federal government and the executive branch and the legislative branch," Kudlow added. A slew of companies in the US & the world take drastic measures to slow the spread of the disease, including temporarily shutting down. The country's cruise lines are suspending operations for a month, while the airline industry has suffered as planes idle on the runway due to global travel bans. One possible option, Kudlow said, is providing a bailout to the airline industry, which has been forced to cancel thousands of flights. "It’s absolutely a key topic of discussion here," Kudlow said. "It’ll be up to Congress as well." Kudlow also floated the possibility of temporarily eliminating the payroll tax, an idea frequently touted by Pres Trump. Currently, all employees and employers pay a 6.2% payroll tax on wages capped out at $137.7K. Right now, an employee earning $50K per year would pay $3100 in payroll taxes. That money goes toward specific programs like Social Security, health care, unemployment compensation & workers' compensation. Workers also pay a Medicare tax of 1.45%. Sources previously said there has been consideration of eliminating it for 3 months, thru the fall, thru the calendar year or permanently\. "The payroll tax holiday is a very powerful weapon. It allows businesses and workers to keep more of what they earn," Kudlow said. "And it’ll provide a lot of cash flow to liquidity. These measures will, I think, help mitigate the economic risks and challenges in front of us."
Kudlow: White House will do 'whatever it takes' to stem coronavirus pandemonium
The Federal Reserve yesterday slashed interest rates by a full percentage point to near 0 & said it would buy $700B in Treasury securities, an aggressive step to insulate the US economy from the coronavirus pandemic. “The coronavirus outbreak has harmed communities and disrupted economic activity in many countries, including the United States,” the Federal Open Market Committee said. “The Federal Reserve is prepared to use its full range of tools to support the flow of credit to households and businesses.” The benchmark federal fund rate is now at 0-0.25%, down from 1-1.25%. The cut essentially brings the nation's interest rate to zero -- something that Pres Trump has repeatedly pressed for over the past year. The historically low interest rates, which not been at this level since the 2008 financial crisis, are expected to remain until the economy recovers. "The Committee expects to maintain this target range until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals," the Fed said. The Fed also said that it will buy at least $500B in Treasury securities & $200B in mortgage-backed securities over the coming months, a program known as "quantitative easing." Earlier this month, Powell announced an emergency 50-basis-point cut to the benchmark federal funds rate, sending it to a range of 1-1.25%. It marked the first time since the financial crisis that the Fed has reduced its key rate outside of scheduled policy-setting meetings.
Fed slashes interest rates close to zero, boosts assets by $700B to fight pandemic
Oil prices slid 10% as the acceleration in coronavirus cases worldwide, which is bringing travel & business to a standstill, further dents global demand for crude. US West Texas Intermediate (WTI) crude dropped $3.03 (9.5%) to settle at $28.70 per barrel. Earlier WTI fell to a session low of $28.03 per barrel. Intl benchmark Brent crude fell 11% ($3.73) to trade at $30.11 & earlier it traded as low as $29.52, its lowest level in 4 years. Oil continues to be hit on both the demand & supply side. The coronavirus outbreak has led to softer demand for crude as people cut back on travel, for example, while a breakdown in OPEC talks means there could soon be a supply glut as Saudi Arabia gets set to ramp up production to a record 13M barrels per day. The move lower comes even after Pres Trump said Fri that the Dept of Energy would purchase crude oil for the SPR in a bid to prop up prices. “Based on the price of oil, I’ve also instructed the secretary of Energy to purchase at a very good price large quantities of crude oil for storage in the U.S. strategic reserve,” Trump said Fri as he also declared a state of emergency. “We’re going to fill it right up to the top, saving the American taxpayer billions and billions of dollars, helping our oil industry [and furthering] that wonderful goal — which we’ve achieved, which nobody thought was possible — of energy independence,” he added. The gov could begin purchasing oil in 2 weeks.
Oil drops nearly 10%, breaking below $29 as demand evaporates
The pan-European Stoxx 600 provisionally closed 5.1% lower, off lows hit earlier in the session. Travel & leisure stocks plummeted around 10% to lead losses as all sectors & major bourses ended the day in the red. Spain's IBEX was around 8.3% in the red & Italy's FTSE MIB was down over 6%. France's CAC 40 provisionally ended 5.9% lower. Germany's XETRA DAX closed 5.3% in the red as the UK's FTSE 100 finished 4.7% lower. Markets spent the day reacting to the shutdown taking place on the continent. Spain has imposed a 15-day nationwide lockdown, banning its 46M citizens from all-non essential movement. The country imposed the state of emergency decree, as it confirmed the highest number of COVID-19 cases in Europe, after Italy. France & Germany have already closed large parts of their economies & fortified borders as they step up their efforts to contain the spread of the coronavirus. Meanwhile, Ursula von der Leyen, European Commission pres, proposed banning most foreign visitors into Europe for 30 days. The UK gov is now facing growing calls to take more drastic measures. Markets were also reacting to the US Federal Reserve's surprise move yesterday; the Fed slashed its benchmark interest rate to zero & launched a massive quantitative easing program in an emergency move.
European stocks close down 5%, airline stocks tank as EU proposes travel restrictions
Gold futures fell to settle at their lowest since Dec & silver futures finished at their worst level in over a decade, as the Federal Reserve’s emergency decision to slash interest rates failed to stem losses in the stock market, sending traders scrambling for cash. Prices for the precious metals, however, managed to significantly cut their losses by the settlement, as short covering kicked in. Gold had dropped more than 4% to hit the day's low. Gold for Apr delivery lost $30 (2%) to settle at $1486 an ounce—the lowest finish for a most-active contract since Dec 20. Prices had dropped by more than 4% from Fri's settlement to touch an intraday low at $1450. Gold rallied late yesterday after the Fed, in a surprise decision last evening, slashed its benchmark interest rate nearly to 0 & implemented a bond-buying program, known as quantitative easing, of at least $700B. But gains soon gave way to losses as equities failed to find support in the wake of the move. While looser monetary policy & pressure on assets perceived as risky, like stocks, would both normally be seen as a positive for gold, the metal has seen weakness in recent sessions on apparent forced liquidation that has seen leveraged investors dump positions en masse.
Gold ends at lowest since December; silver marks worst settlement in over a decade
Stocks opened with must be the biggest drop in history, followed by a feeble attempt at a rally in the next hour. Sellers returned, dragging the averages' levels below the opening. The economy is in deep trouble even with all the money the gov & Fed are throwing around. There is one silver lining (if you can call it that). Being stuck at home, investors have time to look for quality stocks with good yields. The Dividend Aristocrats (there are more than 60) are being hit with selling which raises those yields. Some have very attractive yields (above 3% & even 4%). While more selling is in the cards, the bear market will end, giving an opportunity to lock up high yields. Take a breather tonight & try to relax from this brutal time.
Dow Jones Industrials
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