Dow climbed 123, advancers over decliners 3-2 & NAZ went up 68. The MLP index was off fractionally in the 147s & the REIT index rose 2+ to the 373s. Junk bond funds were in demand & Treasuries crawled higher in price. Oil topped 48 & gold surged 34 to 1893.
AMJ (Alerian MLP index tracking fund)
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The number of Americans filing for first-time unemployment benefits remained elevated last week amid a surge in Covid-19 infections & govs ordering new restrictions to help curb the spread of the virus. Figures from the Labor Dept show 885K Americans filed first-time jobless claims last week, more than the 800K than expected. It marked the highest level since the beginning of Sep, when 893K Americans filed for aid. The number is nearly 4 times the precrisis level but is well below the peak of almost 7M that was reached when stay-at-home orders were first issued in Mar. Almost 70M (40% of the labor force) have filed for unemployment benefits during the pandemic. The number of people who are continuing to receive unemployment benefits fell to 5.5M, a decline of 273K from the previous week. Still, some of the drop in continuing claims may represent workers who have used up the maximum number of payments available thru state unemployment programs (typically about 6 months) & are now receiving benefits thru a separate federal program that extends the aid by 13 weeks. Congress created the extra federal benefits earlier this year with the passage of the CARES Act. But those key federal jobless aid programs created in Mar are slated to expire at the end of the year, leaving 12M workers with no income on Dec 26.
885,000 Americans filed for unemployment benefits last week
Conressuinal leaders continued to hammer out the details of a $900B coronavirus relief bill alongside a year-end spending bill as another gov shutdown deadline tomorrow evening looms. The measure under discussion is expected to include a seconmorrowd stimulus check, boosted unemployment benefits, additional funding for small businesses & another round of aid for the nation's beleaguered airline industry. The drafted proposal excludes 2 of the thorniest issues: funding for state & local govts & a liability shield for businesses against coronavirus-related lawsuits. Senate Majority Whip John Thune said the proposal would likely include direct checks to individuals of $600-700 & expanded jobless aid of $300-a-week thru Mar – both about ½ the size of the payments included in the CARES Act. The top negotiators said they had moved closer to striking a deal on yesterday, sounding more optimistic about the prospect of another round of emergency aid than they had in months. “We’re still close, and we’re going to get there,” Senate Majority Leader Mitch McConnell said last night. Senate Minority Leader Chuck Schumer also said lawmakers are "very close" to reaching an agreement, but maintained that Dems would push for another aid package at the beginning of 2021 when Pres-elect Joe Biden is sworn into office. "It's not a done deal yet," Schumer said. "But we are very close. For Democrats, this has always been about getting the American people the relief they need." The negotiators are racing to attach the $900B deal to a $1.4T omnibus spending deal, which needs to pass tomorrow in order to prevent a gov shutdown at midnight. House Speaker Nancy Pelosi & McConnell have both indicated they want to combine coronavirus relief with the spending measure. That gives leaders just a few days to finalize the aid package & spending bill, approve them in both chambers & send to Pres Trump's desk for his signature.
Negotiations on $900B coronavirus relief deal inch forward
US home builders started construction on homes at a seasonally-adjusted annual rate of 1.55M in Nov, representing a 1.2% increase from the previous month's figure, the Census Bureau reported. Compared with last year, housing starts were up nearly 13%. The pace of building permits was the highest in 14 years. Permitting for new homes occurred at a seasonally-adjusted annual rate of 1.64M, up 6.2% from Oct & 8.5% from a year ago. The forecast called for housing starts to occur at a pace of 1.54M & building permits to come in at a pace of 1.57M. A surge in the multifamily sector — which includes apartment buildings & condos — drove the increase in both housing starts & building permits. Multifamily starts were up 8%, versus 0.4% for single-family homes. And the number of permits issued for buildings with 6 or more units rose nearly 23% between Oct & Nov, compared with a 1.3% uptick for single-family structures. New-home construction activity didn't grow evenly across all parts of the country. Housing starts surged roughly 59% in the Northeast, driven by the multifamily boom, but fell nearly 5% in the Midwest & 6% in the South. The Midwest & South both experience slowdowns in new construction of single-family homes. America's building boom is continuing for now — good news for prospective home buyers. The severe shortage of existing homes for sale has pushed prices higher. As a result, the new-home segment of the market holds renewed importance.
New-home construction charges on, as builders shift focus to multifamily projects
Investors continue to be optimistic about the stimulus package despite the lengthy negotiations & a disappointing jobless claims report. The deadline for tomorrow is understood by everybody in DC, so those guys should find a way to make it happen.
Dow Jones Industrials
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