Dow shot up 161, advancers barely ahead of decliners & NAZ gained 158. The MLP index fluctuated in the 117s & the REIT index was off 2= to the 363s. Junk bond funds inched higher & Treasuries continued weak. Oil drifted lower but remained above 40 & gold surged 37 to 1932 (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)
Pres Trump said that he would like a larger coronavirus stimulus package than either Reps or Dems are asking for just days after tweeting that he was going to shut down negotiations over any such proposal — comments that at the time sent stocks tumbling sharply. Trump's comments came during a wide-ranging, 2-hour-long interview. "I would like to see a bigger stimulus package," Trump said, "than either the Democrats or Republicans are offering." The comment is an about-face from what the pres tweeted earlier this week that he was telling his representatives to stop negotiating a stimulus package for before the election. Trump later softened his stance, & his comments– if serious and not just an off-hand comment – would represent a sharp reversal. Trump's remarks also follow reports that Treasury Secretary Steve Mnuchin was set to discuss a $1.8T stimulus proposal with House Speaker Nancy Pelosi. Pelosi's most recent public offer was $2.2T. "I would like to see money going to people," Trump added. Senate Majority Leader Mitch McConnel, however, said today that he believes a coronavirus deal before the election is "unlikely." Even if Trump & Pelosi are able to agree on a stimulus package, it will be hard to get Senate Reps behind such a proposal.
Trump wants larger COVID stimulus package than GOP or Dems
Commerce Secretary Wibur Ross says the US will collect tariffs on $1.96B worth of aluminum sheet from 18 countries after determining the goods were unfairly dumped here, the broadest trade enforcement action by the agency in more than 2 decades. Collection of the duties on imports from nations including Germany, Bahrain & Oman will go into effect immediately, even though the department's determination was preliminary, Ross said. The Intl Trade Commission is expected to make a final determination in Feb 2021, he added. "This is the largest and most far-reaching case that our department has brought in more than 20 years," Ross said. Brazil, Croatia, Egypt, Greece, India, Indonesia, Italy, Romania, Serbia, Slovenia, South Africa, South Korea, Spain, Taiwan & Turkey were also affected. The money that the US is now moving to collect comes from cash deposits already put down by importers. If the commission rules next year that the countries weren't unfairly dumping aluminum products, the cash deposits will be returned. China is not on the list, Ross said, because the dept already collects tariffs on Beijing's aluminum products. That levy has pushed excess Chinese output into other markets, displacing production in those countries & leading their producers to flood the US with goods priced low enough to undercut American manufacturers. "It's a very complicated matter," Ross comntinued, but "there's a lot of illegal dumping in the U.S., and that's what we're clamping down on." The tariff rates will be highest against Germany, from 52% to 132%, followed by Bahrain with rates in the single digits. Ross dismissed concerns the tariffs might hurt US companies that need aluminum sheet to make their goods. "Fundamental demand for many of the consumer products has gotten very strong," Ross said, pointing to a surge in sales of RVs & luxurious boats as Americans have grown reluctant to fly during the coronavirus pandemic. "When you have those strong, underlying conditions in an industry, the tariffs aren't so much of a problem."
US to collect tariffs on $1.96B worth of aluminum sheet goods: Wilbur Ross
Gold futures settled at their highest in 3 weeks, up roughly
1% from a week ago as the $ lost ground & investors tracked
ongoing fiscal stimulus talks. Dec gold rose $31 (1.6%) to settle at $1926 an ounce, with
prices for the most-active contract ending about 1% higher for the week YTD, gold-backed exchange-traded funds & similar products have seen net inflows of 1003 metric tons, up a 10th month in a row in Sep.
Net inflows surpassed the previous record of 646 metric tons in 2009. Total gold ETF holdings rose to a fresh all-time high of 3880 metric
tons.
Gold ends at a 3-week high, up 1% for the week
The UK gov has expanded its jobs support program as the country
gears up for tighter coronavirus restrictions set to be announced next
week. Finance Minister Rishi Sunak said that firms whose premises have to shut over the winter period as part
of local or national restrictions will receive grants to pay the wages
of staff who cannot work. The
British gov will pay 2/3 of employees' salaries to
protect their jobs over winter. Cash grants to businesses in England
which are required to close will increase to up to £3000 ($3893) per
month. The new program will come into effect on Nov 1 & will
last for 6 months. The BBC reported that the expansion could cost
hundreds of Ms of £s per month. Sunak
called to “safety net for businesses across the U.K. who are required to
temporarily close their doors, giving them the right support at the
right time.” The extra financial support comes ahead of further
coronavirus restrictions which are widely expected to be announced late
Mon, with infections continuing to see a sharp rise. Britain
has reported 564K cases since Covid-19 first emerged late last year,
with 43K deaths. Meanwhile, the Office for National Statistics said
that cases in England had doubled to around 17,200 per
day in the latest week to Oct 1, versus 8400 per day in the previous
week.
UK government expands its job support program with stricter virus lockdowns due next week
Oil futures settled lower following a reported end to a strike in Norway that threatened production, but the US benchmark scored a nearly 10% weekly advance as Hurricane Delta neared landfall on the Gulf Coast. Prices fell to session lows on a report that Norwegian oil firms reached a wage agreement with labor union officials. West Texas Intermediate crude for Nov fell 59¢ (1.4%) to settle at $40.60 a barrel. For the week, the front-month contract gained 9.6%. The global benchmark, Dec Brent crude fell 49¢ (1.1%) to $42.85 a barrel, with prices up 9.1% for the week. The Bureau of Safety & Environmental Enforcement estimated that around 92% of current oil production in the Gulf of Mexico had been shut in as a result of the storm, along with 62% of natural-gas output. Meanwhile, Baker Hughes reported a 3rd straight weekly increase in the number of active US oil drilling rigs — up 4 to 193 this week.
Never a dull moment in DC. The popular averages rose, but the advance decline ratio was only flat. With Trump's latest comments, the future for a relief continues to be unclear. More should be learned this weekend. The Dow chart below shows that it has been treading water for over 2 months. The bulls will say that it remains near setting a new high (just 1K away) in these difficult times, fighting the virus & trying to figure out how to reopen the economy. There will be a lot more excitement from DC next week.
Dow Jones Industrials
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