Dow dropped 130, decliners over advancers about 2-1 & NAZ gave back 140. The MLP index fell 1+ to the 117s & the REIT index tumbled 6+ to 359 (after a recent rally). Junk bond funds were off a tad & Treasuries crawled higher. Oil went up to 41 & gold dropped 18 to 1952 (more on both below).
![Live 24 hours gold chart [Kitco Inc.]](https://www.kitco.com/images/live/gold.gif?0.2180338269244485)
The Trump administration is open to a stand-alone coronavirus stimulus bill that provides additional emergency aid to airlines, White House chief of staff Mark Meadows said after meeting with industry execs. Airlines are hoping to receive another $25B to stave off tens of thousands of job losses, Meadows said. “Compared to $1.5 trillion, it’s a rather small amount of additional assistance that could potentially keep 30,000 to 50,000 workers on the payroll," he added. Under the terms of a $25B bailout fund that was created earlier this year as part of the CARES Act, airlines are prohibited from cutting jobs or reducing workers' pay thru Sep 30. But absent another stimulus deal, major airlines have warned they will be forced to furlough thousands of pilots, flight attendants, gate agents & other employees. One of the biggest points of contention is the package's cost: Dems have offered to come down $1T from the roughly $3T HEROES Act, which the House passed in May. But the White House & Rep leaders want to keep the price tag closer to $1T amid growing concerns over the nation's ballooning deficit. More fiscal aid for airlines has garnered support among some Reps & Dems. At the end of Jul, a majority of House lawmakers penned a letter calling for a 6-month extension of the payroll support program for airlines. More fiscal aid for airlines has garnered support among some Reps & Dems. At the end of Jul, a majority of House lawmakers penned a letter calling for a 6-month extension of the payroll support program for airlines. “Without an extension of the [Payroll Support Program] before then, hundreds of thousands of airline workers will be fired or furloughed on October 1,” the lawmakers wrote. The letter, spearheaded by House Transportation Committee Chairman Peter DeFazio was signed by 223 House members, including 195 Demts & 28 Reps.
White House open to narrow coronavirus relief bill for US airlines as layoffs loom
Americans are grocery shopping less, but spending more. Customer spending at grocery stores jumped 6% from $310 to $330 per month on average; however, supermarket trips dropped nearly 11% compared to a year ago, according to data from digital marketing firm Catallina. The data shows that shoppers made more trips than average in Mar at the height of the pandemic to stock up on food & supplies with stay-at-home orders in place in many parts of the country. Those trips dropped in Apr & the number of trips to the grocery store dropped 10% from May thru Aug. During the month of Aug, the findings show shoppers made 6.7 trips to the grocery store, down 11% from 7.5 trips per month in 2019. However, they're spending an average of $49.28 per grocery haul this year, up from $41.58 in Aug, a 19% increase. Consumers spent the most money on the following categories during the month of Aug: face masks & home health testing kits, which saw 367% year-over-year sales growth; liquid hand soap, up 224%; disinfectant cleaners, up 212%. Meats were also up 121%, according to the report. Less frequent trips to the grocery store could also be a result of more Americans shopping online as retailers beef up convenient online shopping experiences. Nearly 80% of Americans ordered groceries online during the coronavirus pandemic.
Grocery spending up during COVID, despite fewer trips to stores
The number of confirmed cases of the coronavirus that causes COVID-19
worldwide continued to head toward 30M today & the US
case tally climbed above 6.6M, as Pres Trump
contradicted the head of the main US public health agency to insist a
vaccine would be ready in weeks.
Coronavirus update: Global cases near 30 million
Texas is allowing more businesses, including retail stores, gyms & restaurants, to push forward with reopening plans after a surge in coronavirus cases & hospitalizations over the summer have started to decline. Governor Abbott said the state has been divided into 22 regions where officials will monitor hospital capacity & coronavirus cases. In 19 of the 22 regions where hospitalizations related to Covid-19 are now less than 15% of all hospitalizations, more businesses that have been allowed to reopen at 50% capacity will be allowed to increase to 75% capacity beginning Mon. That includes “all retail stores, all restaurants, all office buildings, all manufacturing, all museums and libraries and all gyms,” he said. Effective immediately, hospitals in those regions are allowed to resume elective procedures. Nursing homes & other long-term care facilities will be allowed to reopen for visitations beginning Sep 24 as long as they don't have a coronavirus outbreak, he added. “Since late July, the spread of Covid-19 has steadily and significantly declined. The number of new cases and new hospitalizations have been cut by more than two-thirds. Just yesterday we had the lowest number of hospitalizations in the past three months,” Abbott said.
Texas pushes forward with business reopenings as coronavirus cases slide
Gold futures finished with a loss of 1% as commodity investors reacted to the monetary policy statement from the Federal Reserve which indicated it intends to keep key interest rates near zero through 2023. Although that scenario may prove bullish for gold over the long term, some experts said that investors may be selling gold because the moves by the Fed weren't more demonstrably dovish by offering fresh policy measures, deflating some of the enthusiasm for owning bullion over the near term. Today, the central bank signaled it plans to keep a key US short-term interest rate near zero at least thru the end of 2023 to help the economy recover from the coronavirus. The Fed's forecasts for 2023, released for the first time, also show the rate staying near zero from now until at least 2024. Dec gold lost $20 (1.1%) at $1949 an ounce. The precious metal climbed in electronic trade late yesterday in the immediate aftermath of the Fed decision before retreating. Gold yesterday settled with a gain of 0.2%, ending at their highest level since Sep 1.
Gold prices lose 1% as traders react to Fed policy
Oil futures finished higher as OPEC & its allies stressed the importance of full compliance with output cuts during their monthly meeting. The oil producers (OPEC+) held a joint committee meeting via videoconference today to discuss their existing program of output cuts. The group had previously pared record production cuts of 9.7M barrels per day to 7.7M barrels per day starting in Aug, but also said that countries that failed to previously meet their quota limits would be compensating for their overproduction. The Joint Ministerial Monitoring Committee (JMMC) said it will recommend that the OPEC Conference approve an extension of the compensation mechanism, which was set to end in Sep, until the end of Dec. The committee also pegged overall conformity among participating OPEC+ countries in the output cut agreement at 102% in Aug, including Mexico. Saudi Arabia’s Minister of Energy Prince Abdulaziz bin Salman, who is also chair of the JMMC, stressed the need for all countries to full confirm to their production adjustments. He also said that not fully conforming and then compensating at a later date should not become the norm. The Intl Energy Agency this week reported that OPEC+ reached an overall compliance rate of 97% with the higher Aug supply targets versus 89% on the lower supply targets in Jul. West Texas Intermediate crude for Oct climbed by 81¢ (2%) to settle at $40.97 a barrel. Nov Brent crude added $1.08 (2.6%) to end at $43.30 a barrel.
Oil prices finish higher as OPEC+ stresses full compliance with output cuts
Today traders were less impressed by what they heard from the Fed yesterday. More dovish comments on the future of interest rates would have been appreciated. In the early trading, the Dow sank & than rallied to about breakeven, not far from 28K. Then sellers returned. Buying in the last hour allowed the Dow to recover 200 off its lows. But it still finished in the red. The NAZ hasn't been able to find many fans in Sep.
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