Dow dropped 120, decliners over advancers 2-1 & NAZ pulled back 119. The MLP index declined 1 to 119 & the REIT index added 1+ to the 356s. Junk bond funds slid lower & Treasuries rose in price. Oil was off 1 to 40 & gold fell 3 to 1904. Markets decline on virus unc
AMJ (Alerian MLP Index tracking fund)
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American workers continued to hit the unemployment line in large numbers last week, with 898K new claims filed for jobless benefits. The forecast called for 830K., the highest number since Aug 22 & another sign that the labor market continues to struggle to get back to its pre-coronavirus pandemic mark as cases rise & worries increase over a renewed wave in the fall & winter. The number represented a gain of 53K from the previous week's upwardly revised total of 845K. Despite the higher than expected total, the level of continuing claims continues to fall at a brisk pace, declining by 1.1M to just over 10M. Continuing claims data runs a week behind the headline claims number. Since then, the economy has recaptured some 11.4M positions, about ½ those who were sidelined. The unemployment rate has come down to 7.9% but is still more than double its pre-pandemic level. The 4-week moving average of continuing claims fell by 682K to 11.5M. The insured unemployment rate, a simple measure that compares those receiving benefits against the total labor force, slid 0.9 percentage points to 6.8%. Those receiving first-time benefits under the Pandemic Unemployment Assistance program continued to fall, sliding 91K to 373K. That program provides compensation to those who normally wouldn't be eligible for benefits, such as freelancers & independent contractors. However, recipients under the program accounted for more than ½ of those getting unemployment benefits. Those receiving benefits under the emergency claims portion of the pandemic program increased by more than 800K (that data is 2 weeks old).
Jobless claims jump, hitting highest level since mid-August
Treasury Secretary Steve Mnuchin said that the White House won't let differences over funding targets for Covid-19 testing derail stimulus talks with top Dems. Later,
Pres Trump said that he would raise his offer for a
stimulus package above his current level of $1.8T. House
Dems have passed a $2.2T bill. “I
would. Absolutely I would. I would say more. I would go higher. Go big
or go home, I said it yesterday,” Trump said. “Nancy
Pelosi doesn’t want to give anything. She thinks it helps her with the
election,” he continued. “And I don’t think so. I think it hurts her
with the election because everyone knows she’s holding it up. We’re not
holding it up. She’s holding it up.” The pres also took a swipe at his Treasury secretary: “So far he hasn’t come home with the bacon.” House
Speaker Nancy Pelosi, the lead negotiator for Dems, had identified
testing as one of the main sticking points in talks. Mnuchin appeared
to cede ground to the speaker. “That
issue is getting overblown,” Mnuchin said. “We’ve agreed to $178
billion overall for health. It’s an extraordinary amount of money. We’d
agreed with the Democrats with $75 billion going to testing, contact
tracing.” “What
we have been focused on is the language around testing,” he added. “When I speak to Pelosi today, I’m going to tell her that we’re not
going to let the testing issue stand in the way. We’ll fundamentally
agree with their testing language subject to some minor issues. This
issue is being overblown.”
Mnuchin says he’ll give ground in stimulus talks, Trump says he would up offer
United Airlines (UAL) CEO Scott Kirby said he expects air travel demand to
remain lower than normal until there's a widely available coronavirus
vaccine, but the worst appears to be over. “We think we’ve turned the corner and can see it, Kirby said. A
recovery is still “a long way off,” Kirby said, adding that demand “is
not going to get anywhere close to normal until there’s a widely
available vaccine.” He estimates that will be at the end of 2021. The
pandemic spoiled what is normally the peak summer travel season for
US airlines. After the market closed yesterday, the
carrier reported it lost $1.8B in Q3. Air
travel has ticked higher in the last few months & Kirby noted recent
improvements. But it is still just a fraction of normal levels. In Q3, the Transportation Security Administration screened 64M people at US airports down from 220M a year ago, a 71% decline. UAL began furloughing 13K workers at the start of the month after the terms of a $25B federal payroll support package for airlines that prohibited job cuts expired. The stock fell 1.54.
If you would like to learn more about UAL, click on this link:
club.ino.com/trend/analysis/stock/UAL?a_aid=CD3289&a_bid=6ae5b6f7
United Airlines CEO: ‘We’ve turned the corner,’ but travel demand to remain weak
The lack of progress in stimulus talks is weighing on the stock market. Another sluggish jobless claims report is not helping stir enthusiasm for investors. There are also headwind getting virus vaccines approved. More help will be needed from favorable earnings reports to bring back stock buyers.
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