Dow jumped up 186 (well off early highs), advancers over decliners 2-1 & NAZ gained 62. The MLP index advanced 8+ to the 97s & the REIT index inched up 1 to the 288s. Junk bond funds had modest gains & Treasuries edged higher in price. Oil surged 4+ to the 24s on word of production cuts (more below) & gold rose 36 to 1627.
AMJ (Alerian MLP Index tracking fund)
The number of Americans filing claims for unemployment benefits surged to more than 6.6M last week, breaking a record high for the 2nd week in a row as more states & cities enforced strict stay-at-home measures in an attempt to stop the coronavirus pandemic. Claims blew past the previous week's record of 3.3M, according to the weekly jobless claims report from the Labor Dept. The previous week's total was revised higher by 24K. That brings the total number of Americans who filed for unemployment over the past 2 weeks to nearly 10M, a stunning sign of the colossal economic damage inflicted by the outbreak. The report, which provides the most up-to-date evidence on the labor market & the health of the economy, likely reinforces views that the US has already entered a recession, bringing to an end a historically long, 11-year economic expansion. The jobless numbers will likely continue skyrocketing in the coming weeks as mandated social distancing policies remain in place. The 4-week moving average was 2.053M, up 327K from a week ago. It's the highest since Jan 2017. Before the coronavirus forced large swaths of the economy to shut down, the highest jobless claims reported was 695K in 1982. The peak during the last recession was 665K in 2009. The data dates back to 1967. Every state reported an increase in claims last week. Restaurants, bars, hotels, airlines, cruise lines, automakers & entertainment venues have been hit hard by the pandemic as a growing number of jurisdictions have ordered the closure of nonessential businesses & directed residents to stay at home. Lawmakers are looking to provide relief to laid-off workers with a $2T stimulus package, the largest relief bill in recent memory, that Pres Trump signed last week. In addition to giving adults who earn less than $99K annually up to $1200 checks, the bill expanded unemployment benefits.
Pres Trump expects Russian Pres Vladmir Putin & Crown Prince of Saudi Arabia Mohammed Bin Salman to announce a deal on a production cut. Trump is expecting a cut of 10M barrels, although the cut could be as high as 15M barrels. US West Texas Intermediate (WTI) crude surged more than 30% to trade at $25.36 per barrel, putting it on track for its best day on record & intl benchmark Brent jumped 24%. The Pres later tweeted that a production cut would be “great for the oil & gas industry!” But WTI is still down more than 40% over the last month as oil prices have been hit on both the demand and supply side. Demand has evaporated as the coronavirus outbreak has halted travel worldwide & slowed business activity.
Trump tells CNBC he spoke to Putin, MBS and expects Saudis, Russia to announce 10 million barrel cut
Detroit automakers take market share as consumers flock to pickup trucks amid coronavirus outbrea
A production cut by Saudi Arabia & Russia was to be expected after all the negative stories about the global economy. However, production cuts are only a small part of uncertainties investors have to deal with. The unemployment data was dreadful (as expected) & more bad news lies ahead. The Dow soared in the first hour of trading, but pulled back over 200 from the highs. Additionally, high yielding stocks are stumbling in this environment. These times remain challenging for investors.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CL=F | Crude Oil | 22.06 | +1.75 | +8.6% |
| GC=F | Gold | 1,630.90 | +39.50 | +2.5% |
The number of Americans filing claims for unemployment benefits surged to more than 6.6M last week, breaking a record high for the 2nd week in a row as more states & cities enforced strict stay-at-home measures in an attempt to stop the coronavirus pandemic. Claims blew past the previous week's record of 3.3M, according to the weekly jobless claims report from the Labor Dept. The previous week's total was revised higher by 24K. That brings the total number of Americans who filed for unemployment over the past 2 weeks to nearly 10M, a stunning sign of the colossal economic damage inflicted by the outbreak. The report, which provides the most up-to-date evidence on the labor market & the health of the economy, likely reinforces views that the US has already entered a recession, bringing to an end a historically long, 11-year economic expansion. The jobless numbers will likely continue skyrocketing in the coming weeks as mandated social distancing policies remain in place. The 4-week moving average was 2.053M, up 327K from a week ago. It's the highest since Jan 2017. Before the coronavirus forced large swaths of the economy to shut down, the highest jobless claims reported was 695K in 1982. The peak during the last recession was 665K in 2009. The data dates back to 1967. Every state reported an increase in claims last week. Restaurants, bars, hotels, airlines, cruise lines, automakers & entertainment venues have been hit hard by the pandemic as a growing number of jurisdictions have ordered the closure of nonessential businesses & directed residents to stay at home. Lawmakers are looking to provide relief to laid-off workers with a $2T stimulus package, the largest relief bill in recent memory, that Pres Trump signed last week. In addition to giving adults who earn less than $99K annually up to $1200 checks, the bill expanded unemployment benefits.
Jobless claims surge to new high as virus yanks millions out of work
Pres Trump expects Russian Pres Vladmir Putin & Crown Prince of Saudi Arabia Mohammed Bin Salman to announce a deal on a production cut. Trump is expecting a cut of 10M barrels, although the cut could be as high as 15M barrels. US West Texas Intermediate (WTI) crude surged more than 30% to trade at $25.36 per barrel, putting it on track for its best day on record & intl benchmark Brent jumped 24%. The Pres later tweeted that a production cut would be “great for the oil & gas industry!” But WTI is still down more than 40% over the last month as oil prices have been hit on both the demand and supply side. Demand has evaporated as the coronavirus outbreak has halted travel worldwide & slowed business activity.
Trump tells CNBC he spoke to Putin, MBS and expects Saudis, Russia to announce 10 million barrel cut
Consumers flocked to pickup trucks with 0% financing offers & deferred payments amid the coronavirus pandemic, even as overall auto sales plummeted last month. The
Big Three Detroit automakers took their biggest share of the market
last week since 2006, according to JD Power. The combined market share
of General Motors (GM), Ford (F) & Fiat Chrysler
(FCAU) was 51% to end the week. The Detroit automakers typically represent
about 39-40% of the US retail market, which excludes sales to
fleet customers such as the gov & businesses. While the growth in market share is expected to be temporary, it’s a “good win” for the Detroit automakers in a very challenging market, according to Tyson Jominy, VP of data & analytics at JD Power. “It’s
certainly helpful from a health perspective for the time being,” he said. “They’re certainly moving a lot of high-profit trucks even if
the incentive load is fairly high.” Incentives on pickup sales reached a record
average of $7200 heading into the final days of last month, according
to JD Power. That's up $500 from the pre-coronavirus high. Despite the
rising discounts, such pickups carried net transaction prices of
$42K & are among the most profitable vehicles sold by automakers. GM, FCAU & Ford this week reported overall sales declines for Q1,
however they're sales were better than many rivals without pickup
trucks & special financing offers. Light-duty pickup sales heading
into the final 2 days of Mar were down 27% compared to a 61% for the
overall industry. “Of course, it is on a
very low volume basis, so it’s not as impactful as if it were a market
share gain under normal circumstances, but nonetheless … the Detroit 3
are doing pretty well, relatively speaking,” said Thomas King, pres
of the data & analytics division & chief product officer at JD
Power. FCAU's Ram pickup was able to stay in the black with sales rising
7% in Q1. GM's truck & SUV sales were up 6.7% in the
qtr, led by a 27.3% increase in sales of its highly profitable
full-size Chevy Silverado & GMC Sierra pickup trucks. Ford reported sales of its F-Series pickup, including F-150, declined 13.1% in the qtr.
Detroit automakers take market share as consumers flock to pickup trucks amid coronavirus outbrea
A production cut by Saudi Arabia & Russia was to be expected after all the negative stories about the global economy. However, production cuts are only a small part of uncertainties investors have to deal with. The unemployment data was dreadful (as expected) & more bad news lies ahead. The Dow soared in the first hour of trading, but pulled back over 200 from the highs. Additionally, high yielding stocks are stumbling in this environment. These times remain challenging for investors.
Dow Jones Industrials
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