Dow finished down 109, decliners over advancers about 2-1 & NAZ rose 71 (on a 6 day winning streak). The MLP index fell 1+ to the 128s & the REIT index gave back 4+ to the 325s. Junk bond funds slid lower & Treasuries were sold, bringing higher yields. Oil fell pennies after another wild day inn trading & gold lost 14, falling to 1699 (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)
Even as most US states start to roll back restrictions on businesses & residents that were put in place earlier this year to slow the spread of the novel coronavirus, the economic recovery from the unprecedented lockdown will likely still be slow, according to Chicago Federal Reserve Bank Pres Charles Evans. He said that it's "reasonable" to expect the economy to begin growing in H2 after what's likely to be a historic drop in Q2. But he cautioned that a pickup in economic activity will be "slow" at first because of continued social distancing guidelines & other safety precautions. “Social distancing may be needed for quite some time, depending on the success of testing and tracing, depending on the success of testing and tracing," Evans said. "For some, it may even be necessary to keep these arrangements in place until a vaccine is available." The central bank pres noted the likelihood of his baseline outlook of growth in H2 is "only a bit higher" than a more pessimistic possibility, which could see a 2nd wave of COVID-19 "necessities reshuttering activity, like in Mar. Or bankruptcies could be larger & more widespread, leading to further destruction of employment & business relationships. Or some combination of these scenarios & other difficulties could occur." "Relaxing a stay-at-home policy is a bold decision with pretty high risks, in my opinion," he added. The result of the mandated closures has been an economic free fall that experts caution could rival the depression. In the 2 months since the shutdowns began, more than 33M Americans filed for unemployment benefits, a stunning sign of the depth of the pain inflicted by the virus outbreak. Economists are increasingly warning of a severe contraction in Q2, with some estimates ranging as high as 38%. With some signs the virus has started to plateau in New York, the American epicenter, & a lower-than-projected death toll, Pres Trump in mid-Apr unveiled a guide on how states could proceed with reopening their economies, ultimately leaving it up to governors to make the decisions on timing & breadth.
Unemployment in the US is already at the highest level since the depression, but according to Minneapolis Federal Reserve Bank Pres Neel Kashkari, Americans should prepare for even more devastating job losses. “The worst is yet to come on the job front, unfortunately,” Kashkari said. “It’s really around 23, 24 percent of people who are out of work today, and if this is a gradual recovery the way I think it’s going to be, those folks are going to need more help.” Kashkari is a voting member of the rate-setting FOMC this year. The Fed has aimed its full firepower at the coronavirus pandemic, which has brought American life to a grinding halt, including slashing interest rates to near zero; launching crisis-era lending facilities & purchasing an unlimited number of Treasuries. During the FOMC's Apr rate-setting meeting last week, policymakers pledged that interest rates will remain near zero until the US has weathered the crisis. The federal gov has also passed 4 massive aid packages totaling nearly $3T to help dull the economic pain from the virus outbreak. But according to Kashkari, lawmakers may need to pass additional stimulus measures to help what he predicted will be a long & gradual recovery process. “If this goes on for a long period of time, I think it's going to go on in some phase for a year or two, I think Congress is going to need to continue to give assistance to workers who have lost their jobs,” Kashkari added. Unemployment has surged in the US over the past 2 months as the economy essentially came to a near standstill. In the past 7 weeks, more than 33M Americans have filed for unemployment benefits, the highest since the depression. Economists have forecast a sharp contraction in GDP in Q2, including Fed Chair Jerome Powell, who acknowledged that there may be an "unprecedented" drop in Q2.
Fed prez: Worst numbers 'yet to come,' more help from Congress needed
Athletic apparel maker Under Armour (UA) reported a 22.8% fall in quarterly revenue, as several retailers across the world remained shut due to the COVID-19 pandemic. The company reported a net loss of $1.30 per share, in Q1 ended Mar 31, compared EPS of 5¢ a year earlier. Net revenue fell to $930M from $1.20B. The stock dropped 94¢ (11%).
If you would like to learn more about UA, click on this link:
club.ino.com/trend/analysis/stock/UA?a_aid=CD3289&a_bid=6ae5b6f7
Marriott's (MAR) Q1 profit plunged 92% as business was “dramatically impacted” by COVID-19 & the efforts to contain the virus. The hotel operator & franchisor had EPS of 9¢ as total revenue slumped 7% to $4.68B. Adjusted EPS was 26¢. The results included a $148M (45¢ a share) after-tax impairment charge related to COVID-19. “We have taken substantial steps to preserve liquidity and mitigate the impact of these extremely low levels of demand,” CEO Arne Sorenson said. “We are confident we have sufficient resources to manage through this evolving situation.” MAR ended the qtr with $1.76B cash & $12.2B debt. The company's net liquidity increased to $4.3B in May as a result of raising $2.5B thru a note sale & amendments to cobranded credit-card agreements. Worldwide occupancy fell by 18.2 percentage points to 50.8%. Revenue per available room sank 26.3% to $94.61. There are some signs demand is slowly returning. Occupancy at hotels in Greater China, the region first impacted by COVID-19, reached 25% in Apr, up from 10% in mid-Feb. Additionally, occupancy improved to 20% over the past 2 weeks in North American limited-service hotels. Marriott was unable to give guidance due to the uncertainty caused by COVID-19, but said the virus was likely to result in "significantly lower new room openings" than for what was budgeted. The stock sank 4.86 (6%)..
If you would like to learn more aboutMAR, click on this link:
club.ino.com/trend/analysis/stock/MAR?a_aid=CD3289&a_bid=6ae5b6f7
Gold prices fell, with strength in the $ pressuring prices for the precious metal, as investors eyed concerns about tensions between the US & China and the latest moves to relax shutdowns related to COVID-19. Meanwhile, Pres Trump's administration is planning to issue a warning that hackers tied to the Chinese gov are attempting to steal data from US researchers developing a coronavirus vaccine. The charge comes as Sino-American tensions have flared up lately, with Trump on Fri saying that he was unsure if he should cancel a partial trade deal between The US & Beijing forged in Jan. On Comex, Jun gold fell $15 (0.9%) to settle at $1698 an ounce, after the most-active contract for gold saw a weekly rise of almost 0.8% put in on Fri.
Oil futures ended lower, as a slump in demand for crude outweighed support from a move by Saudi Arabia & other major oil producers to further cut output in Jun. Saudi Arabia's energy ministry directed Saudi Aramco to reduce its crude-oil production by an extra, voluntary 1M barrels per day beginning in Jun, a Saudi Ministry of Energy official told the Saudi Press Agency (SPA). The move brings the total Saudi output cut to around 4.8M barrels per day from the Apr production level, the SPA reported. Saudi oil production for Jun, with the output-cut agreement between OPEC & its allies as well as the voluntary cuts, will total 7.5M barrels per day, it said. OPEC & its allies (collectively known as OPEC+) agreed last month to reduce daily output by 9.7M barrels per day from May 1 thru June. Meanwhile, Kuwait's oil minister said that it was offering support for Saudi Arabia's move to restore balance to the oil market & will voluntarily cut its crude output by an additional 80K barrels per day in Jun. The UAE has also committed to an additional cut of 100K barrels per day in Jun. West Texas Intermediate crude for Jun lost 60¢ (2.4%) to settle at $24.14 a barrel after touching an intraday low of $23.67. The front-month contract rose 25% last week. Global benchmark Jul Brent crude fell $1.37 (4.4%) to $29.60 a barrel. Brent last week logged a 17% weekly climb. Oil production in the US, which isn't part of the OPEC+ pact, has been moving lower, with Energy Information Administration on Wed reporting a 200K barrel per day decline in total domestic output to 11.9M barrels for the week ended May 1.
Oil prices settle lower, even as Saudi Arabia announces additional June output cut
The Dow began the day down 250 but buyers brought it into the black (barely) in the PM. Sellers returned in the last hour. Meanwhile NAZ have been getting the interest of investors. Opening the economy will be done slowly & carefully. Small steps will be taken so that they can be pulled back quickly if needed. Q2 is shaping up as a very dreary time with the possibilty of a slight uptick in Jun. Even gold bugs are cautious.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
Even as most US states start to roll back restrictions on businesses & residents that were put in place earlier this year to slow the spread of the novel coronavirus, the economic recovery from the unprecedented lockdown will likely still be slow, according to Chicago Federal Reserve Bank Pres Charles Evans. He said that it's "reasonable" to expect the economy to begin growing in H2 after what's likely to be a historic drop in Q2. But he cautioned that a pickup in economic activity will be "slow" at first because of continued social distancing guidelines & other safety precautions. “Social distancing may be needed for quite some time, depending on the success of testing and tracing, depending on the success of testing and tracing," Evans said. "For some, it may even be necessary to keep these arrangements in place until a vaccine is available." The central bank pres noted the likelihood of his baseline outlook of growth in H2 is "only a bit higher" than a more pessimistic possibility, which could see a 2nd wave of COVID-19 "necessities reshuttering activity, like in Mar. Or bankruptcies could be larger & more widespread, leading to further destruction of employment & business relationships. Or some combination of these scenarios & other difficulties could occur." "Relaxing a stay-at-home policy is a bold decision with pretty high risks, in my opinion," he added. The result of the mandated closures has been an economic free fall that experts caution could rival the depression. In the 2 months since the shutdowns began, more than 33M Americans filed for unemployment benefits, a stunning sign of the depth of the pain inflicted by the virus outbreak. Economists are increasingly warning of a severe contraction in Q2, with some estimates ranging as high as 38%. With some signs the virus has started to plateau in New York, the American epicenter, & a lower-than-projected death toll, Pres Trump in mid-Apr unveiled a guide on how states could proceed with reopening their economies, ultimately leaving it up to governors to make the decisions on timing & breadth.
Fed's Evan warns of 'high risk' of reopening economy even as coronavirus destroys jobs
Unemployment in the US is already at the highest level since the depression, but according to Minneapolis Federal Reserve Bank Pres Neel Kashkari, Americans should prepare for even more devastating job losses. “The worst is yet to come on the job front, unfortunately,” Kashkari said. “It’s really around 23, 24 percent of people who are out of work today, and if this is a gradual recovery the way I think it’s going to be, those folks are going to need more help.” Kashkari is a voting member of the rate-setting FOMC this year. The Fed has aimed its full firepower at the coronavirus pandemic, which has brought American life to a grinding halt, including slashing interest rates to near zero; launching crisis-era lending facilities & purchasing an unlimited number of Treasuries. During the FOMC's Apr rate-setting meeting last week, policymakers pledged that interest rates will remain near zero until the US has weathered the crisis. The federal gov has also passed 4 massive aid packages totaling nearly $3T to help dull the economic pain from the virus outbreak. But according to Kashkari, lawmakers may need to pass additional stimulus measures to help what he predicted will be a long & gradual recovery process. “If this goes on for a long period of time, I think it's going to go on in some phase for a year or two, I think Congress is going to need to continue to give assistance to workers who have lost their jobs,” Kashkari added. Unemployment has surged in the US over the past 2 months as the economy essentially came to a near standstill. In the past 7 weeks, more than 33M Americans have filed for unemployment benefits, the highest since the depression. Economists have forecast a sharp contraction in GDP in Q2, including Fed Chair Jerome Powell, who acknowledged that there may be an "unprecedented" drop in Q2.
Fed prez: Worst numbers 'yet to come,' more help from Congress needed
Athletic apparel maker Under Armour (UA) reported a 22.8% fall in quarterly revenue, as several retailers across the world remained shut due to the COVID-19 pandemic. The company reported a net loss of $1.30 per share, in Q1 ended Mar 31, compared EPS of 5¢ a year earlier. Net revenue fell to $930M from $1.20B. The stock dropped 94¢ (11%).
If you would like to learn more about UA, click on this link:
club.ino.com/trend/analysis/stock/UA?a_aid=CD3289&a_bid=6ae5b6f7
Coronavirus sends Under Armour's quarterly revenue tumbling 23%
Marriott's (MAR) Q1 profit plunged 92% as business was “dramatically impacted” by COVID-19 & the efforts to contain the virus. The hotel operator & franchisor had EPS of 9¢ as total revenue slumped 7% to $4.68B. Adjusted EPS was 26¢. The results included a $148M (45¢ a share) after-tax impairment charge related to COVID-19. “We have taken substantial steps to preserve liquidity and mitigate the impact of these extremely low levels of demand,” CEO Arne Sorenson said. “We are confident we have sufficient resources to manage through this evolving situation.” MAR ended the qtr with $1.76B cash & $12.2B debt. The company's net liquidity increased to $4.3B in May as a result of raising $2.5B thru a note sale & amendments to cobranded credit-card agreements. Worldwide occupancy fell by 18.2 percentage points to 50.8%. Revenue per available room sank 26.3% to $94.61. There are some signs demand is slowly returning. Occupancy at hotels in Greater China, the region first impacted by COVID-19, reached 25% in Apr, up from 10% in mid-Feb. Additionally, occupancy improved to 20% over the past 2 weeks in North American limited-service hotels. Marriott was unable to give guidance due to the uncertainty caused by COVID-19, but said the virus was likely to result in "significantly lower new room openings" than for what was budgeted. The stock sank 4.86 (6%)..
If you would like to learn more aboutMAR, click on this link:
club.ino.com/trend/analysis/stock/MAR?a_aid=CD3289&a_bid=6ae5b6f7
Marriott profit plunges 92% as coronavirus zaps travel
Gold prices fell, with strength in the $ pressuring prices for the precious metal, as investors eyed concerns about tensions between the US & China and the latest moves to relax shutdowns related to COVID-19. Meanwhile, Pres Trump's administration is planning to issue a warning that hackers tied to the Chinese gov are attempting to steal data from US researchers developing a coronavirus vaccine. The charge comes as Sino-American tensions have flared up lately, with Trump on Fri saying that he was unsure if he should cancel a partial trade deal between The US & Beijing forged in Jan. On Comex, Jun gold fell $15 (0.9%) to settle at $1698 an ounce, after the most-active contract for gold saw a weekly rise of almost 0.8% put in on Fri.
Gold prices fall, with strength in the dollar pulling prices below $1,700
Oil futures ended lower, as a slump in demand for crude outweighed support from a move by Saudi Arabia & other major oil producers to further cut output in Jun. Saudi Arabia's energy ministry directed Saudi Aramco to reduce its crude-oil production by an extra, voluntary 1M barrels per day beginning in Jun, a Saudi Ministry of Energy official told the Saudi Press Agency (SPA). The move brings the total Saudi output cut to around 4.8M barrels per day from the Apr production level, the SPA reported. Saudi oil production for Jun, with the output-cut agreement between OPEC & its allies as well as the voluntary cuts, will total 7.5M barrels per day, it said. OPEC & its allies (collectively known as OPEC+) agreed last month to reduce daily output by 9.7M barrels per day from May 1 thru June. Meanwhile, Kuwait's oil minister said that it was offering support for Saudi Arabia's move to restore balance to the oil market & will voluntarily cut its crude output by an additional 80K barrels per day in Jun. The UAE has also committed to an additional cut of 100K barrels per day in Jun. West Texas Intermediate crude for Jun lost 60¢ (2.4%) to settle at $24.14 a barrel after touching an intraday low of $23.67. The front-month contract rose 25% last week. Global benchmark Jul Brent crude fell $1.37 (4.4%) to $29.60 a barrel. Brent last week logged a 17% weekly climb. Oil production in the US, which isn't part of the OPEC+ pact, has been moving lower, with Energy Information Administration on Wed reporting a 200K barrel per day decline in total domestic output to 11.9M barrels for the week ended May 1.
Oil prices settle lower, even as Saudi Arabia announces additional June output cut
The Dow began the day down 250 but buyers brought it into the black (barely) in the PM. Sellers returned in the last hour. Meanwhile NAZ have been getting the interest of investors. Opening the economy will be done slowly & carefully. Small steps will be taken so that they can be pulled back quickly if needed. Q2 is shaping up as a very dreary time with the possibilty of a slight uptick in Jun. Even gold bugs are cautious.
Dow Jones Industrials
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