Dow dropped 80 (off session lows), decliners over advancers 3-2 & NAZ added 30. The MLP index fell 1+ to the 135s & the REIT index fell 4+ to the 356s. Junk bond funds were little changed & Treasuries remained weak. Oil continued lower in the 42s & gold went up 8 to 1957.
![Live 24 hours gold chart [Kitco Inc.]](https://www.kitco.com/images/live/gold.gif?0.2180338269244485)
An impasse over the next round of coronavirus aid will likely drag
into the weekend after Dems & Reps described themselves as
hopelessly far apart on a deal to combat raging economic &
health-care crises. Party leaders followed a familiar script. They indicated the sides have made no progress toward an agreement. They
do not know when meaningful negotiations will restart. They called the
opposing party unreasonable as Ms of Americans wonder whether they
can afford food or housing in the coming days & weeks. Negotiators’
path to resolving vast differences of opinion over the best tools to
stabilize a country ravaged by the pandemic looks murkier than ever. As
the stalemate drags on, an ineffectual response from Congress risks
hampering efforts to contain the world's worst virus outbreak & blowing up positive steps toward an improved economy. An
agreement on legislation, let alone passage of a bill, looks weeks
away. The House left DC for all of Aug pending a deal on
pandemic aid. The Senate typically leaves town for the weekend after its
session today. The political conventions will
consume their attention over the next 2 weeks. If they return next
month without an agreement, lawmakers will have to consider coronavirus
aid while trying to avoid a gov shutdown by Sep 30. It is unclear now when Dem House Speaker Nancy Pelosi & Senate Minority Leader Chuck Schumer will sit down with Treasury Secretary Steve Mnuchin & White House chief of staff Mark Meadows to resume discussions. Pelosi & Mnuchin last made contact by phone yesterday, when Mnuchin once again said the White House would not
double the GOP's roughly $1T aid offer. Today, Pelosi said she does not have a timeline for when the sides will talk again.
Coronavirus relief stalemate could drag on for weeks
The number of confirmed cases of the coronavirus illness COVID-19 world-wide rose above 20.7M & the US suffered its biggest death toll since May with almost 1500 fatalities counted in a single day. The US has averaged more than 1K deaths a day for 2 weeks. Yesterday's deaths were mostly concentrated in Sun Belt states that saw the worst case spikes in Jun & Jul. A report found that at least 200K more Americans than usual have died since Mar, about 60K more than the official data is linking to COVID-19.
Coronavirus update: Global cases top 20.6 million, and U.S. suffers biggest one-day death toll since May
Cisco (CSCO), a Dow stock, shares faced their worst one-day drop in nearly a decade, after the networking giant's decision to circle the wagons in the form of cost cuts as the company suffers from increasingly selective enterprise spending during the COVID-19 pandemic. Its shares fell under heavy pressure after the company reported a decline in revenue for the fiscal Q4, a soft earnings outlook & the surprise announcement that CFO Kelly Kramer is retiring. In response, the company announced $1B in cuts, which Kramer said will begin with a voluntary retirement offering. Of 27 analysts who cover the stock, 14 have buy or overweight ratings & 13 have hold ratings, with an average price target of $49.67, down from a previous $50.05, as 4 raised their price targets & 4 lowered theirs. The stock sank 5.38 (11%). If you would like to learn more about CSCO, click on this link:
club.ino.com/trend/analysis/stock/CSCO?a_aid=CD3289&a_bid=6ae5b6f7
Cisco stock faces worst day in nearly a decade as cost cuts create more coronavirus concerns
Gold futures notched a back-to-back gain, after taking a
brief dip in the wake of weekly US jobless claims data that showed a
fall below one million for the first time since the coronavirus pandemic
began almost 5 months ago. The slight improvement from 1.19M jobless claims at the
end of Jul is somewhat of a bearish development for haven seekers. New applications for unemployment benefits, a rough gauge of layoffs, declined to 963K, the Labor Dept said. It was the 2nd straight large decline & the first below 1M in more than 20 weeks. Gold futures fell briefly below $1930 an ounce immediately after the jobless claims data, then saw a bumpy ride higher. Dec gold climbed $21 (1.1%) to settle at $1970 an ounce, after
tapping an intraday low of $1923. Prices for the contract remained
lower for the week, down more than 3% from last Fri's settlement. Despite the reduction in jobless claims, some experts say that gold has
managed to hold its ground because claims still remain elevated from the
pre-pandemic levels.
Gold notches back-to-back gain after brief dip in the wake of a fall in weekly U.S. jobless claims
Oil futures finished lower, pressured after the
Intl Energy Agency (IEA) applied a deeper cut to its forecast for
global crude demand in 2020 & as news of diplomatic progress among 2
Arab nations eased risks to supply from the region. However, a 3rd week of declines in US crude supplies &
signs of a recent uptick in consumption helped to limit price losses. The IEA, in its monthly oil market report released today, deepened its forecast for a contraction in global demand
for 2020. The agency expects global demand to contract by 8.1M
barrels a day year on year, 140K barrels more than in last month's
report. It's 2020 oil demand forecast now stands at 91.9M barrels
a day. Analysts said the report might have only a fleeting impact,
with prices underpinned by a continued fall in US crude inventories reported by the Energy Information Administration yesterday. The EIA reported a decline of 4.5M barrels in last week's crude stockpiles, marking a 3rd straight weekly drop. West Texas Intermediate crude for Sep lost 43¢ (1%) to
settle at $42.24 a barrel after spending part of the session flipping
between small gains & losses. The global benchmark, Oct Brent
crude shed 47¢ (1%) at $44.96 a barrel, The report from the IEA came a day after OPEC said it expects oil demand growth to fall 9.1M barrels a day,
extending the fall by 100K barrels a day from its Jul forecast & it
sees 2020 oil demand of 90.6M barrels per day.
Oil futures finish lower as traders assess cut to demand outlook
The outlook for a stimulus package is dim. The conventions will be getting most of the attention by those guys in DC. Their work will drop to zero. At least the economic recovery is managing to stumble forward. But data improvement will take smaller steps in the coming months. The crumbling relationship for US-China trade is a dark could which must be watched. However investors are optimistic & keep bidding stock prices higher.
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