Dow declined 222 (session lows), decliners over advancers better than 2-1 & NAZ climbed 72. The MLP index slid back 2+ to the 116s & the REIT index fell 4+ to the 342s. Junk bond funds were little changed & Treasuries continued in demand. Oil went up 1 to the 39s as production is the Gulf has been shut in & gold edged up 3 to 1908 (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) |
The odds of Congress striking a coronavirus relief deal before the Nov election dimmed considerably this week after the Senate left DC for their Oct recess with no agreement in place. "After the election, we'll get the best stimulus package," Pres Trump said. House Speaker Nancy Pelosi & Treasury Secretary Steve Mnuchin spoke by phone yesterday, the latest in a near-daily effort between the 2 negotiators to winnow the differences on a stimulus package between the administration & Dem leaders. Dems "continue to eagerly await the Administration’s acceptance of our health language, which includes a national strategic plan on testing and tracing. We are hopeful their response will be positive as we also await the outcomes of talks between committee chairs," Pelosi aide Drew Hammill tweeted. “It is clear that our progress depends on Leader McConnell agreeing to bipartisan, comprehensive legislation to crush the virus, honor our heroes — our essential workers — and put money in the pockets of the American people,” he added. The 2 sides traded blame over who's responsible for the latest impasse in talks, with both accusing the other of "moving the goalposts" on a stimulus bill. White House press secretary Kayleigh McEnany acknowledged that "chances are slim" for an agreement with the speaker before the election. She reiterated a frequent criticism among Reps that Dems' proposal is a "radical left wish list" that includes non-COVID related items, such as protections for undocumented immigrants living in the US. “If we’re providing stimulus relief for the American people, it should be just that, for American people, for United States citizens, not a wish list from the liberal left,” McEnany added. “So it’s on her.”
COVID relief likely on pause until after election
Merck (MRK), a Dow stock, reported 3rd-qtr earnings of $2.9B on very strong sales. The company had EPS of $1.16 & EPS adjusted for non-recurring costs & costs related
to mergers & acquisitions came to $1.74. That easily topped expectations for EPS of $1.44. Revenue of $12.55B also easily beating projections for $12.26B. The company expects full-year earnings of $5.91-6.01 on revenue of $47.6-48.6B. The stock fell 84¢.
If you would like to learn more about MRK, click on this link:
club.ino.com/trend/analysis/stock/MRK?a_aid=CD3289&a_bid=6ae5b6f7
Strong sales of drugs, vaccines, propel Merck in third quarter
The average number of new daily cases of the coronavirus in the US hit another record yesterday as 36 states reported worrying rises in the number of hospitalized patients. The
average number of patients hospitalized with Covid-19 over the past 7 days rose by at least 5% in 36 states, according to data from the Covid Tracking Project. Hospitalizations
lag behind cases as it takes time for people to get diagnosed &
become sick enough to require medical attention. However,
epidemiologists point to hospitalizations as a more telling indicator of
the severity of an outbreak than new cases, which can fluctuate based
on testing. In
Illinois, where Gov JB Pritzker announced new business restrictions
last week in 4 counties & Chicago, 2638 people were hospitalized
with Covid-19 yesterday. That pushed their 7-day average over 2480, a more than 24% increase compared with a
week ago. In Texas, El Paso County
Judge Ricardo Samaniego issued a curfew to protect
“overwhelmed and exhausted” hospitals & workers. More than 5200
people there were in hospitals with Covid-19 yesterday. The Lone Star state has had an average of 4970 Covid-19 patients in hospitals on any given day over the past
week, up more than 18% compared with the previous week. “I think
that the community and the country needs to realize that this is just
the beginning of what could be a dark and tragic time over the next four
to six weeks,” Dr Ogechika Alozie, chief medical officer of Del Sol
Medical Center in El Paso, said. The
average number of hospitalized patients over the past 7 days
declined by 5% or more in just 4 states: Alaska, Hawaii, Kansas &
Maine.
Covid hospitalizations rising in 36 states as U.S. hits another record for average new cases
Gold futures ended higher as data revealed a decline in consumer confidence over the US jobs market & economy, boosting the precious metal's haven appeal. US consumer confidence waned in Oct, with the index dipping to 100.3 this month from a pandemic high of 101.3 in Sep. Gold futures made only modest moves higher in the past 2 days, but posted their 6th gain in 7 sessions amid ongoing uncertainty around the 2020 presidential election. Expectations that the US may further increase its fiscal deficits, if the elections in America lead to a sweeping victory for Dems, are viewed as a potential longer-term boost for gold prices. Gold for Dec tacked on $6 (0.3%) to settle at $1911 an ounce following a modest gain yesterday. The settlement was the highest for a most-active contract in a week & prices tallied a 6th gain in 7 sessions. US equities were mixed, though finding some support from upbeat corp news, including a number of deal announcements, &, perhaps, bets on greater spending by the gov to help the relief the economic pressures created by the pandemic.
Gold prices end higher as U.S. consumer confidence slips
Shares of Caterpillar (CAT), a Dow stock, fell after the construction & mining equipment maker reported Q3 profit & sales that
fell, but beat expectations. EPS was
$1.22 a share compared to $2.66 in the year-ago
period. The estimate was for $1.17. Revenue
fell 22.6% to $9.88B, but above the consensus of $9.73B. Among some of its business segments, energy &
transportation sales dropped 24% to $4.16B to top expectations of
$3.91B & construction industries sales declined 23% 5o $4.06B to beat forecasts of $3.85B. "Our third-quarter results
largely aligned with our expectations, and we're encouraged by positive
signs in certain industries and geographies," said CEO Jim
Umpleby. The company did not provide financial guidance. The stock dropped 5.34.
If you would like to learn more about CAT, click on this link:
club.ino.com/trend/analysis/stock/CAT?a_aid=CD3289&a_bid=6ae5b6f7 .
Caterpillar profit and sales fall, but top expectations; stock drops
Oil futures finished higher as another major storm cut energy output in the Gulf of Mexico by roughly ½, though worries the impact on demand from the ongoing rise globally in COVID-19 cases continues to hang over the market. The Bureau of Safety & Environmental Enforcement reported that 49% of Gulf oil production & 55% of natural-gas production in the region was shut in. That marked a jump from Gulf shut ins of just 16% of oil & 6% of natural-gas output. West Texas Intermediate crude for Dec rose $1.01 (2.6%) to settle at $39.57 a barrel, following a loss of 3.2% yesterday. The global benchmark, Dec Brent crude, gained 74¢ (1.8%) to end at $41.20 a barrel. Several European countries have imposed tighter restrictions on activity in an effort to contain the virus. The US has averaged 71K new cases a day in the last week, it’s highest for a 7-day period since the start of the outbreak,.
Oil gains as Tropical Storm Zeta forces shutdown of roughly half of U.S. Gulf output
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