Markets plunge as daily coronavirus cases reach a record high

Dow tumbled 649 (but 300 above early lows), decliners over advancers 8-1 & NAZ sank 189.  The MLP index shed 4+ to the 117s & the REIT index dropped 6+ to the 346s.  Junk bond funds drifted lower & Treasuries rose were purchased.  Oil gave back 1+ to the 38s & gold was steady at about 1904 (more on both below).

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A Covid-19 vaccine being developed by the University of Oxford & AtroZeneca (AZN) showed a promising immune response and low levels of adverse reactions in the elderly & older adults, according to an interim analysis that the drugmaker said was encouraging.  The vaccine, now in late-stage human trials aimed at showing its efficacy & safety, is a front-runner in the global sprint for a shot to protect lives & jump-start economies hobbled by the pandemic.  Trials in the UK could produce results before year-end, fueling hopes among scientists & gov leaders that a vaccine might be available for high-risk groups here by early 2021.  The results showed positive outcomes for adults over 56, including the especially higher-risk age group of those 70 & older, & were based on analysis of previously conducted interim safety & immune-response data, AZN & Oxford said.  The elderly generally have been prone to more-severe Covid-19 symptoms than younger people.  Thus, researchers have been looking for evidence that a vaccine will be able to specifically help protect them.  “It is encouraging to see immunogenicity responses were similar between older and younger adults,” AZN said.  “This marks a key milestone and reassures us that the vaccine is safe for use and induces strong immune responses in both parts of the immune system in all adult groups,” Oxford said.  The data showed a lower “reactogenecity” to the vaccine among older adults. That refers to the level of expected side effects, including potential fever, swelling at the site of the injection and body aches.  Such reactions were lower in adults 56 & older than in younger adults, according to the interim analysis. The reactions also lessened after the 2nd of a 2-dose application, AZN added.  Details of the interim analysis have been submitted to a peer-reviewed journal, Oxford & AZN.  The timing of an expected report isn't clear, but Oxford said it hopes the publication will be in the coming weeks.  The stock rose 1.07.
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This COVID-19 vaccine shows promising response in older adults

Sales of new homes fell by 3.5% in Sep to a seasonally-adjusted annual rate of 959K units, the Commerce Dept said, as the housing market's summer buying season came to a close.  The Commerce Dept said that despite the modest decrease, sales of new homes are up 32.1% from a year earlier, as the housing market remains strong despite the pandemic.  The housing market, like most of the economy, came to a near standstill in Mar & Apr, causing the typical spring summer buying season to be delayed until the summer.  Once economies reopened, pent up demand translated into sales of both new & existing homes, driving home prices in many places to record highs.  In Jul, home sales spiked 13.9%.  New home sales for Aug were revised downward to 994K from a previously reported 1.01M units.  The median price of a new home sold was $326K.

Here are the latest home sale numbers–things are slowing down

Gold futures ended higher to eke out their 5th gain in 6 sessions, finding support as global equities fell in response to rising COVID-19 cases in the US & Europe.  A stronger US currency, meanwhile, served to limit gains for the $-denominated yellow metal.  Gold for Dec was fractionally higher to settle at $1905 an ounce.  The most-active contract had posted gains each day last week, with the exception of Thurs.  US benchmark stock indices fell sharply, with pressure attributed in part to a continued surge in COVID-19 cases, with the number of new US infections hitting a daily record on Fri & European countries imposing tougher restrictions on activity.  Long-running talks toward a new round of aid spending from DC, meanwhile, have yet to bear fruit.

Gold futures settle modestly higher as U.S. benchmark stock indexes drop 

Oil futures declined, sending prices to their lowest finish in just over 3 weeks, as COVID-19 cases in the US & Europe continue to surge, raising alarm over demand for crude.  Meanwhile, Mohammad Barkindo, secretary-general of OPEC said that economic growth & the demand recovery remain “anemic.”  But he remained optimistic that the recovery will continue, and while it may take longer and be at lower levels, OPEC is “determined to stay the course.”  West Texas Intermediate (WTI) crude for Dec, the US benchmark, fell $1.29 (3.2%) to settle at $38.56 a barrel.  The global benchmark, Dec Brent crude, dropped $1.3 (3.1%) to settle at $40.46 a barrel.  Based on the front-month contracts, WTI & Brent crude marked their lowest settlements since Oct 2.  Confirmed global cases of COVID-19 climbed to 43M, according to Johns Hopkins University, while the death toll rose to 1.15M.  European countries have tightened restrictions on activity in response to surging cases, while the number of US infections saw a record daily rise on Fri, surpassing the previous peak from Jul.  Meanwhile, news on the supply side of the equation was also a negative.  Libya's National Oil at the end of last week lifted force majeure on remaining major oil terminals.  A blockade by a militia was lifted in Sep, but not all facilities had yet come back on line.  The state-owned oil company said Libya's output would rise to 800K barrels a day within 2 weeks & 1M barrels a day within 4 weeks.  Still, traders kept an eye on potential disruptions to oil & natural-gas production & refinery activity in the Gulf of Mexico as the region braced for another storm, expected to reach the Gulf Coast later this week.

Oil prices settle at 3-week lows as coronavirus cases rise world-wide

Trading started already down, near 28K, & selling continued throughout the day,   However there was late day buying to trim the heavy loss.  The news on higher cases of cornavirus around the world kept buyers away.  A gloomy forecast by OPEC for global economic growth does not help the bulls to make their case for buying socks.  Without positive developments on the fight with coronavirus, market turbulence is likely to last until the election if not longer.

Dow Jones Industrials