Dow surged 455 to close at session highs, advancers over decliners 5-1 & NAZ jumped 141. The MLP index rose 5+ to 130 & the REIT index gained 7+ to 330 (little changed in the last month). Junk bond funds edged higher & Treasuries were sold while stocks were being purchased. Oil advanced 1+ to the 24s & gold pulled back 17 to 1708 (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)
The Apr jobs report was easily the worst on record, with US unemployment soaring to the highest level since the depression. But according to Larry Kudlow, Pres Trump's chief economic adviser, the worst for the labor market may be yet to come. "I don't know if it's as bad as it gets," Kudlow added. "I don't think this pandemic contraction has yet fully run its course." US employers cut 20.5M jobs in Apr, the Labor Dept said, providing the first comprehensive look at the economic catastrophe triggered by the coronavirus pandemic. More than a decade of job gains were erased in a single month; the stunning job losses are more than double what the US saw during the 2008 financial crisis. The paralyzed US economy & the tidal wave of layoffs, pushed the unemployment rate — which sat at a ½-century low of 3.5% in Feb — to the highest level since record-keeping began in 1948. The previous record was 10.8% in 1982. The number of job losses is also the biggest on record dating back to 1939. Previously, the largest one-month job loss number was 1.96M in 1945, at the end of World War II. "This is a number full of heartbreak and hardship," Kudlow said. "There's no way to get around it." It's possible the Apr jobs report, which relied on surveys conducted in the early weeks of the month, did not capture the full extent of the damage inflicted by the outbreak of the virus, which has forced an unprecedented shutdown of the nation's economy. In the 7 weeks since the nation's economy came to a near standstill, more than 33M Americans have filed for first-time unemployment benefits, meaning the jobless rate will likely continue to climb in May, even as some states move forward with easing stay-at-home guidelines. A more inclusive measure of what's called underemployment, which counts those not looking for work & individuals who are reduced to part-time hours for economic reasons, hit an all-time high of 22.8% last month. "I think we are in the reopening stage," Kudlow said. "I think it will phase in in May and probably spill over into June. In the first instance, the economic and jobs number are going to continue to deteriorate."
Pres Trump said he's having a difficult time with China, particularly on the issue of trade, following a phone call the previous night between US & Chinese trade officials. China's Vice Premier Liu He, Treasury Secretary Steve Mnuchin & US Trade Representative Robert Lighthizer discussed economic & trade issues yesterday, but Trump said that he hasn't made any progress on a trade deal after officials agreed to implement Phase One in Jan. "I'm having a very hard time with China," Trump said. The pres said he has yet to make a decision on the future of a trade deal between the 2 nations, which have gone head-to-head over China's initial response to the outbreak of the novel coronavirus. Trump said that even though he was "very tough with China," & the country "had to buy $250 billion worth of products" from the US, including "$40-50 billion" from US farmers, he feels "very torn" as to how the country will approach future trade agreements. "I have not decided yet," he added. During Thurs's call, US & Chinese representatives said both countries should strengthen macroeconomic & public health cooperation to make progress in terms of moving forward with a trade deal, & both countries agreed to maintain communication & cooperation on a regular basis. The parties also agreed that positive progress is being made on the Phase One agreement & creating the governmental infrastructures necessary to make it a success. They also agreed that in spite of the pandemic, both countries fully expect to meet their Phase One obligations on time. Phase One represents the first step toward what is expected to be a more comprehensive trade agreement between the world's 2 largest economies & has been in the works since Oct, after nearly 2 years of a trade war. It also includes a potential $200B purchase of US goods from China, reduced US tariffs omn China, progress on additional phases of a trade deal 2 regular meetings between the 2 countries" trade representatives.
Reopening the US economy should be handled cautiously to avoid a second lockdown, said Cleveland Fed Pres Loretta Mester. “There’s a possibility of opening up in the second half of the year, but it has to be done in a very, very careful way to avoid having to go backwards because that would be a devastating outcome,” Mester added. Mester said the federal gov & the central bank have to be ready to do more to help the economy. “If you think of this as building a bridge, as the shutdown has gone on longer than people expected at the beginning, the bridge has to be longer. It also has to be wider because more households and more businesses are under stress,” the Cleveland Fed pres said. US equity benchmarks continued to reflect improved sentiment about the end of the coronavirus lockdown.
Fed’s Mester warns reopening must be done ‘very carefully’ to avoid going backwards
Gold futures settled lower, as traders parsed data showing a loss of more than 20M US jobs in Apr tied to efforts to stop the spread of the COVID-19 pandemic, but prices for the precious metal ended the week a bit higher. The coronavirus pandemic destroyed 20.5M US jobs in Apr, driving the unemployment rate to a post Word War II high of 14.7% as the country faced its biggest economic crisis in almost a century, according to data from the Labor Dept. Still, the loss of jobs was less than the 22.1M loss forecast. Jun gold fell $11 (0.7%) to settle at $1713 an ounce, after spending much of the session seesawing between modest losses & gains. For the week, the most-active contract for gold saw a weekly rise of almost 0.8%. A report that top US & China trade negotiators held a telephone call, pledging to create favorable conditions for their phase-one trade deal, helped to bolster appetite for assets considered risky & limit any upside in gold. The call, reported by China's state-run Xinhua News Agency, came after Pres Trump threatened to “terminate” a phase-one Sino-American trade.
Crude-oil futures finished higher, with optimism over production cuts & rising demand for gasoline lifting to US benchmark prices up by 25% this week. The moves come a day after a sharp rally collapsed amid doubts over compliance with an agreement to cut global production & comments from central bankers that injected some doubt about the pace of global economic recovery in the aftermath of the COVID-19 pandemic. West Texas Intermediate crude for Jun rose $1.19 (5.1%) to settle at $24.74 a barrel. Prices for the front-month contract rose 25% for the week. Global benchmark Jul Brent crude added $1.51 (5.1%) at $30.97 a barrel for a 17.1% weekly climb.
Oil futures finish higher, with U.S. prices up 25% for the week
The Dow rose 600 this week after 2 down weeks. Data is gloomy, but investors are looking to the future. US-China trade relations have become uncertain as this gets combined with the coronavirus pandemic. Next week could bring a better understanding about future trade relations with China.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
The Apr jobs report was easily the worst on record, with US unemployment soaring to the highest level since the depression. But according to Larry Kudlow, Pres Trump's chief economic adviser, the worst for the labor market may be yet to come. "I don't know if it's as bad as it gets," Kudlow added. "I don't think this pandemic contraction has yet fully run its course." US employers cut 20.5M jobs in Apr, the Labor Dept said, providing the first comprehensive look at the economic catastrophe triggered by the coronavirus pandemic. More than a decade of job gains were erased in a single month; the stunning job losses are more than double what the US saw during the 2008 financial crisis. The paralyzed US economy & the tidal wave of layoffs, pushed the unemployment rate — which sat at a ½-century low of 3.5% in Feb — to the highest level since record-keeping began in 1948. The previous record was 10.8% in 1982. The number of job losses is also the biggest on record dating back to 1939. Previously, the largest one-month job loss number was 1.96M in 1945, at the end of World War II. "This is a number full of heartbreak and hardship," Kudlow said. "There's no way to get around it." It's possible the Apr jobs report, which relied on surveys conducted in the early weeks of the month, did not capture the full extent of the damage inflicted by the outbreak of the virus, which has forced an unprecedented shutdown of the nation's economy. In the 7 weeks since the nation's economy came to a near standstill, more than 33M Americans have filed for first-time unemployment benefits, meaning the jobless rate will likely continue to climb in May, even as some states move forward with easing stay-at-home guidelines. A more inclusive measure of what's called underemployment, which counts those not looking for work & individuals who are reduced to part-time hours for economic reasons, hit an all-time high of 22.8% last month. "I think we are in the reopening stage," Kudlow said. "I think it will phase in in May and probably spill over into June. In the first instance, the economic and jobs number are going to continue to deteriorate."
COVID-19 job cuts may not have peaked yet: Kudlow
Pres Trump said he's having a difficult time with China, particularly on the issue of trade, following a phone call the previous night between US & Chinese trade officials. China's Vice Premier Liu He, Treasury Secretary Steve Mnuchin & US Trade Representative Robert Lighthizer discussed economic & trade issues yesterday, but Trump said that he hasn't made any progress on a trade deal after officials agreed to implement Phase One in Jan. "I'm having a very hard time with China," Trump said. The pres said he has yet to make a decision on the future of a trade deal between the 2 nations, which have gone head-to-head over China's initial response to the outbreak of the novel coronavirus. Trump said that even though he was "very tough with China," & the country "had to buy $250 billion worth of products" from the US, including "$40-50 billion" from US farmers, he feels "very torn" as to how the country will approach future trade agreements. "I have not decided yet," he added. During Thurs's call, US & Chinese representatives said both countries should strengthen macroeconomic & public health cooperation to make progress in terms of moving forward with a trade deal, & both countries agreed to maintain communication & cooperation on a regular basis. The parties also agreed that positive progress is being made on the Phase One agreement & creating the governmental infrastructures necessary to make it a success. They also agreed that in spite of the pandemic, both countries fully expect to meet their Phase One obligations on time. Phase One represents the first step toward what is expected to be a more comprehensive trade agreement between the world's 2 largest economies & has been in the works since Oct, after nearly 2 years of a trade war. It also includes a potential $200B purchase of US goods from China, reduced US tariffs omn China, progress on additional phases of a trade deal 2 regular meetings between the 2 countries" trade representatives.
Trump on future China commerce deal: 'I have not decided yet'
Reopening the US economy should be handled cautiously to avoid a second lockdown, said Cleveland Fed Pres Loretta Mester. “There’s a possibility of opening up in the second half of the year, but it has to be done in a very, very careful way to avoid having to go backwards because that would be a devastating outcome,” Mester added. Mester said the federal gov & the central bank have to be ready to do more to help the economy. “If you think of this as building a bridge, as the shutdown has gone on longer than people expected at the beginning, the bridge has to be longer. It also has to be wider because more households and more businesses are under stress,” the Cleveland Fed pres said. US equity benchmarks continued to reflect improved sentiment about the end of the coronavirus lockdown.
Fed’s Mester warns reopening must be done ‘very carefully’ to avoid going backwards
Gold futures settled lower, as traders parsed data showing a loss of more than 20M US jobs in Apr tied to efforts to stop the spread of the COVID-19 pandemic, but prices for the precious metal ended the week a bit higher. The coronavirus pandemic destroyed 20.5M US jobs in Apr, driving the unemployment rate to a post Word War II high of 14.7% as the country faced its biggest economic crisis in almost a century, according to data from the Labor Dept. Still, the loss of jobs was less than the 22.1M loss forecast. Jun gold fell $11 (0.7%) to settle at $1713 an ounce, after spending much of the session seesawing between modest losses & gains. For the week, the most-active contract for gold saw a weekly rise of almost 0.8%. A report that top US & China trade negotiators held a telephone call, pledging to create favorable conditions for their phase-one trade deal, helped to bolster appetite for assets considered risky & limit any upside in gold. The call, reported by China's state-run Xinhua News Agency, came after Pres Trump threatened to “terminate” a phase-one Sino-American trade.
Gold prices fail to find support as investors parse historic U.S. jobs report for April
Crude-oil futures finished higher, with optimism over production cuts & rising demand for gasoline lifting to US benchmark prices up by 25% this week. The moves come a day after a sharp rally collapsed amid doubts over compliance with an agreement to cut global production & comments from central bankers that injected some doubt about the pace of global economic recovery in the aftermath of the COVID-19 pandemic. West Texas Intermediate crude for Jun rose $1.19 (5.1%) to settle at $24.74 a barrel. Prices for the front-month contract rose 25% for the week. Global benchmark Jul Brent crude added $1.51 (5.1%) at $30.97 a barrel for a 17.1% weekly climb.
Oil futures finish higher, with U.S. prices up 25% for the week
The Dow rose 600 this week after 2 down weeks. Data is gloomy, but investors are looking to the future. US-China trade relations have become uncertain as this gets combined with the coronavirus pandemic. Next week could bring a better understanding about future trade relations with China.
Dow Jones Industrials
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