Dow rose 52 in a day of volatile trading, advancers barely ahead of decliners & NAZ was up 39. The MLP index was flattish in the 105s & the REIT index rose 1+ to the 335s. Junk bond funds were little changed & Treasuries crawled higher in price. Oil went up above 40 again & gold finished up 2 to 1870 (more on both below).
![Live 24 hours gold chart [Kitco Inc.]](https://www.kitco.com/images/live/gold.gif?0.2180338269244485)
More Americans are focused on paying their bills on time as the economy steers a recessioin brought on by the coronavirus pandemic. Nearly ½ of American households have seen a decline in their income since the outbreak, and with Ms out of work or making less, the financial implications are far-reaching. According to a new study by Bankrate, 46% of US adults have prioritized catching up or staying current on bills over the past few months. That figure is up 38% from the same time last year. The survey questions, which asked participants about their financial priorities over the past few months & the extent to which those priorities were met, has been administered about ½ a dozen times since 2012. Saving more money remains the 2nd most-cited financial priority from previous years, followed by paying down credit card debts or student loans & providing financial assistance to family members of friends. “While staying current on bills is typically the top answer, we have not seen it to the reported extent and by such a wide margin in quite some time,” CFO at Bankrate Greg McBride said. “That was the alarming result. What we are seeing here is a reflection of the fact that that has become more widespread in this recession.” Financial priorities have not discriminated either. Across all income brackets, 49% of households have seen a decline in income since the pandemic. And among every demographic classification of income group, gender, race, age, geographic location & political affiliation, staying current on the bills was the most commonly cited priority. While 52% of households with an annual income of under $50K cited this as their top financial priority in recent months, 45% of upper-middle class households & 37% of higher-income households reported the same. Between generations, ½ of baby boomers ranked staying current on bills as their top concern, followed by millennials, with nearly ½ of those ages 24-39 stressing the importance of staying up-to-date on payments. Even though no age group or income bracket has been immune to the financial repercussions brought on by the pandemic, the impact has fallen hardest on younger & lower-income workers. Unemployment and income reduction tends to skew younger. As result, millennials continue to take more of the brunt of joblessness & reduced income during the pandemic. As the economy heads into a deeper economic woes, more Americans are focused on trying to pay the bills every month. “We are all in for an extended period of financial difficulty for millions of households due to elevated unemployment, extended periods of joblessness and reduced incomes,” McBride said. “Americans have been running down on what were meager savings to begin with. The longer the economic effects of a pandemic stretch on, the more financial hardship households will feel and the more households that will feel.”
More Americans are concerned about paying bills on time during pandemic
The US economy is within reach of a nearly full recovery by the end of the year, said St Louis Fed Pres James Bullard. The economy is expected to have rapid growth in Q3, reversing the steep decline in the Apr-Jun qtr when the pandemic shut down the economy. Economists now expect strong growth in the Juy-Sep qtr. If this continues in Q4, Bullard said the US could return to the average level of national income, one way to measure the broader economy, in 2019. For instance, if GDP grows at a 35% rate in Q3, it would need growth at a 10% rate in the final 3 months of the year to hit that level. Such a forecast is “a little bit outside of what even the optimistic forecasters are saying but I wouldn’t put it out of the realm of possibility that you could have the fourth quarter GDP close to our average for 2019 and that would be a great outcome for the U.S. economy,” Bullard added. Economists expect Q3 GDP will grow at a 25% annual rate as it snaps back from the worst of the shutdown & they believe Q4 will see growth at a slower 6% pace. The economy plummeted by a record 31.7% rate in Q2. Bullard said the fact that hitting the 2019 average income level is a possibility “shows you how far we’ve come.” He said a 2nd wave of the pandemic was possible but that it shouldn't dominate forecasts. “What I’m kind of pushing gently back against in the forecasting community and maybe showing my colleagues, is that the baseline case is really that the private sector is adapting,” Bullard said. He didn't think the US was “that far from having simple, easy, technological solutions” that could lead to a return to activity, pointing to advances in rapid testing. He cautioned that downside risks remain substantial & things could go wrong, adding that he wasn’t advocating a change in the Fed's low-interest-rate policy & agreed with other Fed officials that the economy was still in a deep hole.
Fed’s Bullard says U.S. economy within reach of full recovery this year
The global tally for confirmed cases of the coronavirus that causes COVID-19 climbed to 32M, according to data aggregated by Johns Hopkins University<,
while the death toll rose to 977K. The US was the world's leader
with almost 7M cases & 202K deaths. There were at least 1091
new deaths in the US yesterday, up from 942 the day before, while
new cases reported increased to 42K from 37K the day before.
The new case tally compares with the daily average 41.8K over the past
week, which is up 14% from the average 2 weeks earlier. Brazil has
the 2nd highest death toll in the world at 138K & 3rd highest
case tally at 4.6M,. India is 3rd with 91K
deaths & 2nd with 5.7M cases. Mexico is 4th with 75K
deaths & 7th with 710K cases. The UK has 42K deaths &
412K cases, the highest death toll in Europe & 5th-highest in the
world.
Coronavirus tally: U.S. death toll jumps by more than 1,000 in a day
Gold futures ended higher to tally their first gain in 3 sessions, as a recent price drop to a 2-month low raised the
precious metal's appeal among bargain hunters. Prices for the
metal had been trading lower early in the session & remains more than
4% lower for the week, with overall strength in the $ contributing
mightily to the deterioration in bullion. Dec gold rose by $8 (0.5%) to settle at $1876 an ounce. Prices based on the most-active contract logged a 3rd straight session
decline yesterday & settled at their lowest since late Jul. Gold had been trading lower as a weekly reading of those
seeking unemployment benefits, used as a running gauge of the health of
the economy amid the viral pandemic, came in somewhat weaker than
expected.
Gold futures score first gain in 4 sessions
Oil futures finished higher, supported by signs of tighter US crude supplies, despite persistent concerns that rising cases of COVID-19 will lead to weaker energy demand. West Texas Intermediate crude for Nov edged up 38¢ (1%) to settle at $40.31 a barrel after tapping a low at $39.12. Nov Bre, the global benchmark, added 17¢ (0.4%) to trade at $41.94 a barrel. Oil rose yesterday after the Energy Information Administration reported that US crude inventories fell for a 2nd straight week, by 1.6M barrels last week. That was much less than the forecast for a decline of 4M barrels, but the American Petroleum Institute yesterday had reported an increase of 691K barrels.
Oil prices end higher, buoyed by signs of tighter supplies
Stocks struggled in the AM & then rallied during the midday period. The sellers to the Dow briefly into the red followed by limited buying into the close. The weak jobless claims report plagued the market all day. More news about the virus fighting back was another negative for the the market. Attempts for stocks to rally this month have sputtered.
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