Dow climbed 60, advancers over decliners about 2-1 & NAZ gained 36 after yesterday's decline. The MLP index jumped 7+ to the 158s (its highest in months) & the REIT index rose 1+ to the 359+. Junk bond funds were off a tad & Treasuries were also weak. Oil rose almost 1 to the 53s, not seen since Feb, & gold added 5 to 1856 (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 federal gov is changing the way it allocates coronavirus vaccine doses, now basing it on how quickly states can administer shots & the size of their elderly population, Health & Human Services Secretary Alex Azar said. States will be given 2 weeks to prepare for the change, Azar said. That should give states enough time to improve their data reporting to the gov & ensure all vaccinations are being “promptly” documented. States aren't currently reporting vaccinations in a timely matter, Azar said, adding that vaccine doses “are sitting in freezers in hospitals.” The announcement comes as the Centers for Disease Control & Prevention issues new guidelines that expand coronavirus vaccine eligibility to everyone 65 & older as well as to those with comorbid conditions, like diabetes & heart disease. The states' focus on vaccinating health-care workers & nursing homes has created a bottleneck, slowing the pace of inoculations, a senior administration official said. “States should not be waiting to complete phase 1a prioritization before proceeding to broader categories of eligibility,” Azar added. “Think of it like boarding an airplane. You might have a sequential order in which you board people. But you don’t wait till literally every person from a group is boarded before moving on to the next.” The Trump administration will also stop holding back Ms of doses reserved for the 2nd round of shots 2-dose vaccines, the official said, adding they've released doses that had been held in reserve on Sun. Pres-elect Joe Biden’s transition team announced a similar plan Fri.
U.S. to change Covid vaccine allocation to favor states that quickly administer shots
Long-dormant inflation could rebound more quickly than anticipated as the economy shakes off the effects of the coronavirus pandemic, Kansas City Federal Reserve Pres Esther George said. Current measures show that inflation remains subdued, as it has been for most of time since the financial crisis of 2008. However, George noted that the Fed's preferred inflation gauge is weighed down by some of the sectors hardest hit during COVID-19 crisis. That means it may not accurately represent the real state of inflation, which could rise quickly once the virus is under control & some industries, particularly those in the services & hospitality area, recover. “In contrast to these sectors, price inflation for many other categories of consumption (particularly goods) has moved up, sometimes quite sharply,” George added. “Such a scenario does not suggest higher inflation is a near-term threat, but rather that inflation could approach the Committee’s average inflation objective more quickly than some might expect.” “To the extent that a postvaccine bounce-back boosts demand and prices in these sectors, including airfares and hotel accommodation, inflation could move up quickly,” she said. George has long been thought to be one of the FOMC's more hawkish members, meaning that in the past she has questioned the central bank's highly accommodative monetary policy. However, her remarks came amid a spike in long-term gov bond yields that could be signaling some market concern about inflation. She spoke a day after Atlanta Fed President Raphael Bostic said it might be necessary to start raising interest rates by mid-2022, a view well out of the FOMC consensus. George did not express a view on what the policy ramifications might be of her inflation comments. “Overall, the outlook is for monetary policy to remain accommodative for some time,” she said. “It is too soon to speculate about the timing of any change in this stance.”
Fed’s Esther George cautions that inflation could rise faster than expected
Job openings decreased as 2020 neared a close, with the biggest hit coming to the battered hospitality industry as the Covid pandemic surged. Total positions opened decreased by 105K in Nov, a 1.6% drop from Oct & a 3.9% fall from a year earlier, according to the Labor Dept's Job Openings & Labor Turnover Survey (JOLTS). Leisure & hospitality took an especially hard hit, with a slide in job openings & a sharp increase in layoffs & overall separations. Though the report runs a month behind the dept's nonfarm payrolls count, the JOLTS tally is watched by policymakers for indications of tightness in the labor market. In all, there were 6.6M openings for the month, compared with the 10.7M workers the gov considers unemployed. The net payrolls gain of 336K remained relatively brisk for the month, though growth ended in Dec with a decline of 140K. The JOLTS report indicated that the slowdown in vacancies came primarily in hospitality, where bars, restaurants, hotels & casinos have taken a hit from the economic restrictions that officials have imposed to combat Covid. Case counts have continued to rise despite lockdowns & other restrictions. Leisure & hospitality openings fell to 801K for the month, down just 16K from Oct but off 17% from the same period in 2020. At the same time, layoffs increased sharply, rising 17.6% from Oct to 1.68M. The separations rate rose for the month as 271K workers lost or left their jobs, a 3.8% rate compared with 3.6% in Oct. The gain was due primarily to the leisure & hospitality rate, which surged to 8.2% from 5.8%. The rate is computed by dividing the number of separations by total employment & multiplying by 100. On a monthly basis, the biggest job opening declines came in durable goods manufacturing (-48K), information (-45K) & educational services (-21K.). The quits rate, a proxy for workers' confidence that they can find new jobs, was little changed for the month at 2.2%. However, leisure & hospitality saw a sharp gain in that metric, rising to 4.7% from 4.3% as workers in the industry transition to other professions. Within the industry, accommodation & food services rose to 5% from 4.5% in Oct. Hires overall were little changed on the month at a 4.2% rate. Again, leisure & hospitality saw a sharp drop, from a 7.8% rate to 7.3% to the lowest total level since Aug.
Job openings fall, worker departures rise as Covid surge hits hospitality
Gold futures finished in negative territory, relinquishing early gains in a lackluster session that extends a weeklong weakening trend for precious metals. Falling gold prices come as investors wager on the prospect of further fiscal stimulus to reflate the economy in the wake of the coronavirus pandemic, with Pres-elect Joe Biden taking office on Jan 20. Some experts say they are watching $1800 as a crucial level for gold to stay above, with a breach below signaling that a bearish trend may be taking hold of the precious commodity. Biden on Fri called for extra financial relief for Americans “now” after the latest US jobs report showed losses for the first time in 8 months, a reflection of the continued toll the coronavirus pandemic is taking on the economy. The private sector & gov shed 140K jobs in Dec, the Bureau of Labor Statistics reported. A steady rise in the yields for long-term bonds, which can compete against gold for haven buying, ultimately may be eroding appetite from precious metals. The 10-year Treasury note rate was at an intraday peak of 1.186% early today, yielding 1.15%. Feb gold traded $6 (0.4%) lower to settle at $1844 an ounce, following a 0.8% gain yesterday.
Gold ends lower as buyers point to $1,800 as key price to watch
US crude production won't bounce back in 2021 from last year's fall,
the Energy Information Administration (EIA) forecast in its Jan Short-Term
Energy Outlook. The EIA estimated that US output
will fall to 11.1M barrels a day this year. Production dropped to
11.3M barrels a day in 2020 from a record 12.2M barrels a
day in 2019. The agency sees production rising to 11.5M barrels a
day in 2022. Production by OPEC, is expected to average 27.2M barrels a day in
2021, up from an estimated 25.6M barrels a day in 2020, the
agency forecast. On the demand side, which was slammed last year by the
COVID-19 pandemic & remains under wraps, the EIA estimated global
consumption of petroleum and liquid fuels averaged 92.2M barrels a
day for all of 2020, down 9M barrels a day from 2019. EIA
said it expects global liquid fuels consumption to grow 5.6M
barrels a day in 2021 & 3.3M barrels a day in 2022. Oil futures
remained higher after the report, with West Texas Intermediate crude
for Feb up 73¢ (1.4%) at $52.98 a barrel.
U.S. oil production to fall to 11.1 million barrels a day in 2021: EIA
AstraZeneca's (AZN)
COVID-19 vaccine could be available across the EU in mid-Feb, an
EU official said, after the pharmaceutical company applied
for distribution approval in the 27-member bloc. The European Medicines Agency announced that it is now studying the results of the AZN & Oxford University vaccine under an “accelerated timeline” & could
issue its opinion as early as Jan 29. This jab is being rolled out
in the UK since early Jan. “If
we were to have a successful authorization for the AstraZeneca
contract… we hope that two weeks after that authorization, AstraZeneca
would be able to give the first delivery,” Sandra Gallina,
director-general for health & food safety at the European Commission
told lawmakers. “And they are thinking of I’d
say two deliveries a month, but this is all in the making, they need to
discuss this with the member states,” she added. The stock slid back 24¢.
If you would like to learn more about AZN, click on this link:
club.ino.com/trend/analysis/stock/AZN?a_aid=CD3289&a_bid=6ae5b6f7
AstraZeneca Covid jab could be distributed across Europe by mid-February, EU official says
Oil futures ended higher, with Brent crude resuming a push to the upside as a bounce by the $ appeared to lose steam. West Texas Intermediate crude for Feb rose 96¢ (1.8%) to finish at $53.21 a barrel, its 6th straight positive session. Mar Brent, the global benchmark, advanced 92¢ (1.7%) closing at $56.58 a barrel after losing ground the previous session. Both benchmarks saw their highest finish since Feb 21. Analysts said crude was taking a cue in part from equities, which were firmer after a modest pullback yesterday. Analysts said crude remained underpinned by Saudi Arabia's decision last week to cut its oil output by 1M barrels a day in Feb & Mar, helping to blunt fears about the impact of a continued rise in COVID-19 cases & tougher lockdowns on demand. Investors have also debated whether a sharp rise in crude prices since late last year could prompt a quick boost in output by US shale producers. The Energy Information Administration’s short-term energy outlook for Jan, however, forecast US output to fall to 11.1M barrels a day this year, unchanged from its previous projection.
Oil ends higher as dollar sees renewed weakness
Dow Jones Industrials
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