Dow jumped 140, advancers ahead of decliners 5-4 & NAZ shot up 184. The MLP index fell 1+ to the 112s & the REIT index gained 4+ to the 344s. Junk bond funds continued mixed & Treasuries edged higher. Oil was higher in the 39s & gold slid back 4 to 1906 (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) |
Federal Reeserve Chair Jerome Powell & Treasury Secretary Steve Mnuchin expressed cautious optimism that the US economy is rebounding from the pandemic-induced recession with federal support but that more help from the gov is likely needed. Powell told the House Financial Services Committee that he believed the economy was “healing.” Mnuchin, the chief economic spokesman for the Trump administration, proclaimed that the country was in the “midst of the fastest economic recovery from any crisis in history.” Striking a more cautious note, Powell noted that the job market has regained only about ½ the 22M jobs that were lost in Mar & Apr when the virus flattened the US economy, triggering a recession. Both officials stressed that major sectors of the economy were still suffering. Some Rep lawmakers complained that House Dems were blocking approval of further relief because of their insistence on achieving a larger package than GOP lawmakers are willing to support. Mnuchin said he was ready to resume negotiations & added that the administration would be willing to support stand-alone legislation to boost support thru the Paycheck Protection Program, which benefited small businesses. “We are in a very different situation than we were the last time” when Congress pushed thru nearly $3T. “At that time, the entire economy was shut down.” Powell said that further support should be more targeted to industries such as restaurants & the travel industry that have been most impacted.
Fed's Powell, Treasury Sec. Mnuchin optimistic, but call for more COVID relief
The coronavirus which was first confirmed in the US about 8 months ago,
has killed more than 200K across the country as
US officials rush to approve & manufacture a vaccine. The
US had reported at least 200K confirmed Covid-19 deaths, more than any other country in the world, according to
data compiled by Johns Hopkins University. The
US which accounts for roughly 21% of all confirmed Covid-19 deaths
around the world despite having only 4% of the world’s population, is
battling one of the deadliest outbreaks in the world. Fatalities in the
US have doubled over the last 4 months, after the virus took 200K lives in the first 4 months of the outbreak. The
US has reported about 61.09 deaths per 100K residents, making it
the country with the 11th most deaths per capita, according to data from
Hopkins. Brazil, Chile, Spain, Bolivia, Peru & the United Kingdom
among others have all reported more deaths per capita than the US. The US continues to report worryingly high numbers of new confirmed
cases & deaths every day. Over the past 7 days, the country has
reported an average of more than 43K new cases per day, up over 19%
compared with a week ago.
And the country continues to report more than 750 Covid-19 deaths every
day. While doctors have new medications & treatment strategies to save
the lives of Covid-19 patients, epidemiologists worry deaths could
accelerate if the virus surges in the winter as expected.
The U.S. coronavirus death toll tops 200,000, and it’s just ‘the tip of the iceberg’
Larry Kudlow, Pres Trump's top economic advisor, said that the broad economic recovery from Covid-19 doesn't necessarily require additional fiscal stimulus even if select industries or businesses could benefit from additional aid. “I don’t think the V-shaped recovery depends on the package, but I do think a targeted package could be a great help,” Kudlow said. “Even though I think the economy is improving nicely, it could use some help in some key, targeted places.” Kudlow added that the White House has for weeks championed more funding for schools & the Paycheck Protection Program, a facility established by the Cares Act earlier this year that provides loans to small businesses so long as employers agree to use the funds to keep staff on payrolls. He also acknowledged that while the overall US economy appears to be in the middle of a comeback after a recession, there are still industries that are suffering as a result of the virus & efforts to contain its spread. “We also wanted to extend the assistance plan, the PPP plan, to small business. I mean, we actually had money – it’s over $100 billion – that could be repurposed to go back in through that plan,” Kudlow added. “I think that plan was very effective. I think it did save, perhaps, 50 million jobs.” “Unfortunately, we couldn’t reach agreement with the other side. And so that was before the judicial issues came up,” he added. “I wish we could break the stalemate.” Kudlow's suggestion that the US economy could continue in a sharp rebound without further aid appeared to mark a deviation from statements made by both Federal Reserve Chair Jerome Powell & Treasury Secretary Steve Mnuchin just hours earlier.
Economy doesn't need more stimulus for a V-shaped recovery, Trump advisor Kudlow says
Gold prices ended lower for a 2nd session as the $ continued its climb on the back of concerns about fresh COVID-19 lockdowns implemented in London & other parts of Europe. Rising cases in Europe & in the US. have unsettled investors about the global economic recovery, driving investors into $s, which has weighed on bullion. On top of that, investors also have unwound some of their gold holdings as a part of yesterday's equity-market turbulence, which added to the pressures around precious commodities. European countries, including France, Spain & the UK, are grappling with rising coronavirus numbers, & UK Prime Minister Boris Johnson introducing new restrictions to stem the spread of coronavirus, including 10PM curfews for pubs & restaurants in England, in a reversal from the summer relaxing of coronavirus restrictions. Meanwhile, new cases in the US rose by 52K, marking the highest single-day increase since Aug 14, according to Johns Hopkins University. Dec gold shed $3 to settle at $1907 an ounce, following a very big 2.6% slide yesterday. Today's settlement was the lowest for most-active contract in 2 months. Bullion's price finish on Comex yesterday pushed gold beneath its short-term, 50-day moving average at $1941 an ounce — a move that is seen as contributing to a view that gold's bullish short-term trend line was in jeopardy. Market technicians view moving averages as dividing lines between bullish & bearish momentum in an asset.
Gold prices suffer back-to-back losses as dollar extends run-up
Oil settled higher, finding support from expectations for a 2nd weekly decline in US crude supplies. Prices scored a partial rebound from the sharp decline in oil seen a day earlier, when the rise of COVID-19 cases & potential for renewed activity restrictions in Europe fed a global equity selloff. Oil production in the Gulf took a hit from Hurricane Laura, which made landfall in late Aug & then from Hurricane Sally last week. Today, 7.1% of Gulf oil output was shut in, according to the Bureau of Safety & Environmental Enforcement. Tropical Storm Beta made landfall along the Texas coast late yesterday. While the bounce today was welcome for oil bulls, analysts said uncertainty around the outlook for both demand & supply was likely to keep a lid on the market in the near term. Supply concerns also remain, with Libya expected to boost output nearly 3 fold to 300K barrels a day, as a military commander who controls the eastern portion of the country ends a blockade of ports.
Oil scores partial rebound as traders bet on a second weekly decline in U.S. crude supplies
The Dow was in the red until midday, then buyers brought in into the black. The NAZ had a good day with most of the buying later in the day. Coronavirus is getting more attention with rising new cases in the US & western Europe. But the big story is somewhat mixed. NY was the epicenter of the virus in Apr, but has gotten the virus pretty much under control. New cases have plunged since Apr & daily deaths have been in single digits since Jun. That's what flattening the curve is about. After rising in the US, daily new cases are down from around 70K to under 40K. Good but short of great. The number of daily deaths has fallen from over 2K to under 1K since May. Again, good but short of great. The virus is fighting back hard in this war. Meanwhile, popular stock averages are remaining in elevated territory when compared to the depths in late Mar (although lower in Sep).Dow Jones Industrials
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