Dow dropped 105,(but off session lows to hold above 39K) decliners modestly ahead of advancers & NAZ tumbled 243. The MLP index declined 2 to the 148s & the REIT index was off 3+ to the 367s. Junk bond funds were mixed & Treasuries remained in demand. Oil slid lower in the 45s & gold sank 38 to 1836 (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)
Congress has hit a wall again in efforts to send help to Americans during a coronavirus outbreak that has killed thousands of people a week & left Ms waiting in food lines. After days of trying to reach a relief deal, lawmakers had not resolved a range of issues preventing an agreement. A Congress that has failed for months to send aid to desperate people will now have to quickly resolve disputes to prevent Ms of people from losing unemployment insurance or housing. Dem leaders have called bipartisan talks toward a $908B relief bill the best chance to craft a plan that can get thru a divided Congress. Lawmakers have not yet finalized the legislation because of disagreements over legal immunity for businesses & state & local gov relief. Top Reps have accused their counterparts of refusing to make a deal. House Speaker Nancy Pelosi & Senate Minority Leader Chuck Schumer rejected a $916B offer from the Trump administration because it included a one-time $600 direct payment but no federal unemployment insurance supplement. The bipartisan package includes a $300 weekly boost to jobless benefits. Pelosi & Schumer also brushed off Senate Majority Leader Mitch McConnell's proposal to scrap his demand for business and university immunity from coronavirus-related lawsuits if Dems back off their calls for state & local aid. Dems & many Reps have called federal support necessary to prevent cash-crunched govs from cutting first responder & teacher jobs. It was unclear what kind of plan could get thru both the Dem-held House & GOP-controlled Senate. Congress faces pressure to act: about 12M people could lose unemployment benefits on the day after Christmas & a federal eviction moratorium expires at the end of the year.
Covid relief talks hit another wall as Congress runs short on time to send help
Gold futures fell, posting their first loss in 3 sessions and marking their lowest finish in a week, weighed down by strength in the $, as investors awaited further progress toward a new COVID-19 relief package in Congress & a US vaccine rollout. The session's pullback comes after the Trump administration proposed $916B in aid, including checks for hard-hit Americans, but Senate Majority Leader Mitch McConnell claimed that Dem leaders were uncooperative. The UK saw a rollout of COVID-19 vaccines & the US may soon follow as Food & Drug Administration gets ready to review a Pfizer (PFE) & BioNTech's (BNTX) candidate tomorrow. Vaccine distribution provides hope for a return to a more normal economy, lessening the need for safe-haven investments. Feb gold declined $36 (1.9%) to settle at $1838 an ounce, after rising 0.5% yesterday, marking the highest settlement for a most-active contract since Nov 17. Prices settled at their lowest since Dec 2. Bullish gold investors say that a persistent weakening trend in the $, which many commodities are priced in, will underpin higher values for gold & other precious assets that are purchased using weaker currencies.
Gold prices fall to lowest finish in a week
The global case tally for the coronavirus illness COVID-19 climbed above 68M & the US tally rose above 15M as the virus continued to race across the nation, filling hospitals with record numbers of patients. The US took just 5 days to get from 14M confirmed cases of the virus to 15M. It took 6 days to get to 14M from 13M. There were 104K COVID-19 patients in US hospitals yesterday, beating the record set a day earlier. Hospitalizations have topped 100K & set fresh records for 7 straight days. At the height of the pandemic in spring, hospitalizations remained below 60K at peak levels. Dr Deborah Birx, coordinator of the White House Task Force created to manage the US response to the pandemic, said transmission has moved from public spaces to private ones as Americans mingle indoors more, including for the recent Thanksgiving celebration, when Ms of people traveled to see family. That has meant that as improvements are seen in states that were overwhelmed in the spring or summer, the virus is spreading fast in other areas, including rural areas with fewer hospitals. The US added 220K new cases yesterday & at least 2597 people died. The US has averaged 207K cases a day for the last week, up 18% from the average just 2 weeks ago.
U.S. coronavirus case tally climbs to 15 million from 14 million in just five days
China's factory gate prices fell at a slower pace in Nov, adding to signs that the economy continues to recover from the COVID-19 pandemic, but consumer prices declined for the first time in over a decade on falling food prices. The producer price index (PPI) fell 1.5% from a year earlier, the National Bureau of Statistics said. The index was expected to ease 1.8% after a 2.1% drop in Oct. The consumer price index (CPI) unexpectedly fell 0.5% in Nov from a year earlier, the first decline since 2009, after rising 0.5% in Oct. The forecast called for no change in consumer prices & the 0.5% fall was lower than any individual forecast. The fall in year-on-year CPI was mostly driven by volatile food prices, which dropped 2% from a year ago in Nov. Core inflation - which excludes food & energy costs - remained benign last month at 0.5%, unchanged from Oct. China has seen a steady recovery since it was hard hit by the pandemic in Q1, when authorities imposed lockdowns & travel restrictions to contain the virus. Recent data showed China's exports grew at the fastest pace in almost 3 years in Nov while manufacturing activity also expanded at its quickest rate in more than 3 years that month. But some analysts say the recovery has been uneven, with certain sectors struggling with the appreciation of the yuan or with still tepid global demand.
Chinese factory gate prices indicate economy recovering from COVID-19
Oil futures ended on a mixed note, with global prices up slightly but US benchmark crude posting a loss on the back of the biggest weekly increase in domestic crude supplies since Apr that was seen as due to a possible to “one-off” rise in imports. The likelihood that a COVID-19 vaccine will soon be rolled out in the US. also helped to ease worries surrounding energy demand, limiting downside moves for oil prices. The Energy Information Administration (EIA) reported that US crude inventories rose by 15.2M barrels last week. That was the largest weekly climb since Apr, when the EIA reported a weekly rise of 19.2M barrels — the biggest weekly rise on record — for the week ended Apr 10. The forecast expected to see a weekly decline of 700K barrels. The American Petroleum Institute reported a 1.1M-barrel rise. Total net petroleum imports, the difference between exports & imports, rose to 4.6M barrels a day, from 1.9M barrels per day a week earlier, the EIA reported. West Texas Intermediate crude for Jan delivery fell 8¢ to settle at $45.52 a barrel, the lowest front-month contract finish since Dec 2. Feb Brent crude tacked on 2¢ to $48.86 a barrel. Oil futures had turned lower after the significant weekly rise in crude supplies reported by the EIA. New infections continue to accelerate, but analysts said prospects for a new round of aid spending in DC had continued to support crude. Treasury Secretary Steve Mnuchin had offered a $916B package to House Speaker Nancy Pelosi that would include a $600 direct payment to most Americans but eliminate a $300 a week unemployment benefit favored by a bipartisan group of Senate negotiators. Pelosi said there had been progress, but called dropping the supplemental jobless benefits unacceptable. Senate Majority Leader Mitch McConnell claimed Dem leaders were uncooperative.
Senate Majority Leader Mitch McConnell lashed out at Dem leaders, saying they were moving the goalposts on reaching a another fiscal stimulus deal to combat the economic impact of the coronavirus pandemic. “There is a huge list of helpful policies that both sides agree on,” McConnell said. “This need not be rocket science. But we can’t do a thing unless the Democrats decide they actually want to make a law.” McConnell's statement on the Senate floor came after Dems rejected 2 Rep offers on a deal in the past 24 hours. Treasury Secretary Steven Munchin offered a $916B package that would include $600 checks to most Americans but eliminate unemployment benefits. And McConnell offered to drop his pet provision — a shield for businesses against lawsuits for COVID-19 negligence — if Dems would drop the insistence that aid to state & local govs be a feature of the legislation. Nancy Pelosi & Senate Majority Leader Chuck Schumer rejected these proposals. They said they want to build instead on a separate $908B bipartisan plan & accused McConnell of trying to undermine that compromise put together last week. In a response to McConnell later on the Senate floor, Schumer said the Republican proposal was “an encouraging sign that the Republican leadership is moving in the right direction by endorsing a bill” of a similar size to the one from the bipartisan group of moderates. Analysts think the give-&-take among lawmakers is actually a good sign & that a stimulus package looks likely to become reality before the end of the year. Lawmakers plan to pass a one-week spending bill this week to fund gov operations that would give themselves more time to finish work on a more comprehensive deal. The House is expected to vote on the bill later today. The final shape of a plan might not come until early next week.
McConnell lashes out at Democrats as fiscal stimulus discussions stumble forward
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