Dow lost 42, decliners over advancers about 2-1 & NAZ went up 37. The MLP index fell 2+ to 129 & the REIT index rebounded 5+ to the 356s. Junk bond funds were mixed & Treasuries rose in price. Oil slid lower in the 42s & gold dropped 20 to 1950.
AMJ (Alerian MLP Index tracking fund)
| CL=F | Crude Oil | 41.64 | -1.29 | -3.0% |
| GC=F | Gold | 1,941.30 | -29.00 | -1.5% |
The number of Americans filing for unemployment benefits unexpectedly rose last week to more than 1M, the Labor Dept reported. Initial weekly jobless claims totaled more than 1.1M last week, bringing the total number of claims to 57.4M -- more than 1/3 of the US labor force -- since coronavirus-related lockdowns began in Mar. The forecast called for 925K new claims. Last week, the number of Americans filing for jobless aid fell below 1M for the first time since the pandemic began. While the figure was adjusted upward today to 971K, it remains less than that benchmark. The latest data nonetheless showed some optimistic indications: Continuing claims, a broader category that measures unemployed workers receiving benefits for longer than a week, totaled 14.8M, 156K less than expected, for the prior week ending.
More than 1.1M Americans filed for unemployment benefits last week
China & the US have agreed to hold trade talks “in the coming days” to evaluate the progress of their Phase 1 trade deal 6 months after it took effect in Feb, the Chinese commerce ministry said. Ministry spokesman Gao Feng made the comments but did not elaborate. They followed remarks today by White House Chief of Staff Mark Meadows that no new high-level trade talks were scheduled, though both sides were in touch about implementing the Phase 1 deal. The deal, reached on Jan 15 & seen as a major breakthrough after a 2-year long trade dispute between the world's 2 largest economies, set ambitious targets for China to sharply boost purchases of US farm & manufactured goods. But ties quickly soured in the aftermath of the coronavirus pandemic & China's imposition of a new national security law in Hong Kong. Both sides traded threats & sanctions on individuals & businesses, such as Chinese video platform TikTok. Official data also suggests China's imports of US farm & manufactured goods, energy & services are well behind the pace needed to meet a first-year target increase of $77B over 2017 purchases. China's purchases have increased as its economy recovers from this year's coronavirus lockdown, however. On Tues, Pres Trump said he had postponed an Aug 15 review of the trade pact, in frustration over Beijing's handling of the virus pandemic.
China, US will hold talks 'in coming days,' Chinese commerce ministry says
The Philadelphia Federal Reserve's manufacturing index fell 7 points to a seasonally adjusted reading of 17.2 in Aug, the regional bank said. This is the 2nd straight decline in the index after it his 27.5 in Jun. Any reading above zero indicates improving conditions. The forecast called for a 20 reading. The headline index is based on a single standalone question about business conditions unlike the manufacturing index which is a composite based on components Below the headline, the new orders index fell 4 points to 19 & the shipments index fell 5.9 points to 9.4. The survey found that optimism about the next 6 months remained solid, with the index for future activity rising 3 points to 38.8. Manufacturing has recovered a lot of ground lost from the coronavirus related lockdowns in mid-Mar but the slowing in the pace of activity in Aug fits with concern that further gains for the sector will be difficult. Earlier this week, a similar survey conducted by the New York Fed showed activity slowed with sentiment falling 13.5 points to 3.7 in Aug.
Philadelphia Fed manufacturing index slows for second straight month in August
The Dow sold off after the opening. The jobless claims report was a solid negative. The Philadelphia index above is one more indication that the economic recovery is stumbling along. That has to be expected given all the damage that has been done to the economy. Recovery numbers in the coming months should be mediocre after the large gains off depression lows. US-China trade relations are complicated, but it looks like they will be taking a few steps forward.Dow Jones Industrials
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