Dow jumped 291 to a new record over 31K, advancers over decliners a modest 3-2 & NAZ shot up 276 to go over 13K. The MLP index went up 2+ to 152 & the REIT index slid back 2+ to 359. Junk bond funds rose in price & Treasuries continued to be sold as stocks market rallies. Oil reached 51 & gold added 9 to 1918.
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The number of Americans filing for first-time unemployment benefits unexpectedly ticked lower last week, even as a rise in Covid-19 infections & new restrictions to help curb the spread of the virus weighed on the labor market's recovery. Figures released by the Labor Dept show 787K Americans filed first-time jobless claims last week, lower than the 800K forecast. The number is nearly 4 times the pre-crisis 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 Americans (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 5.1M, a decline of 126K from the previous week. The report shows that roughly 19.1M Americans were receiving some kind of jobless benefit. Because many out-of-work Americans have used up their 26 weeks of state jobless aid, they have transferred to obtaining the money through the PEUC. There are about 7.3M workers receiving PUA benefits & roughly 4.6M receiving PEUC benefits, according to Labor Dept data.
Unemployment claims unexpectedly fall but layoffs remain elevated
A record number of people died in the US from Covid Tue & Wed. A record 3733 people died from the virus on Tues, followed by 3865 deaths yesterday, according to Johns Hopkins University. Over the past 7 days, the country reported an average of 2686 fatalities every day — a figure 2nd only to the record set a little over 2 weeks ago. Holiday festivities have led to a predicted explosion in Covid-19 cases that have overwhelmed hospitals across the nation as a vaccine rollout got off to a rocky start. Over 361K people in the US have died of the disease since the virus arrived in the US nearly 12 months ago. Since then, almost 1 in every 914 US residents has died of the coronavirus since the pandemic began. DC's health dept said it halted vaccinations early after a mob of Pres Trump's supporters stormed the US Capitol building, prompting the mayor to impose a 6PM curfew across the city & delaying the certification of Pres-elect Bidn's s victory in the 2020 presidential election. The number of new daily cases continues to soar, as well. The country reported over 253K new cases yesterday, bringing the 7-day average up over 222K, the highest it's ever been, an indication of more deaths to come over the next few weeks as diagnosed people are hospitalized. Across the country, more than 132K are hospitalized with Covid, the highest yet.
A record number of people died from Covid the last two days in America
The large service side of the US economy grew somewhat faster in Dec despite a record increase in coronavirus cases, as companies took hope in the rollout of vaccines & looked toward the future. A survey of senior execs at non-manufacturing companies rose to a 3-month high of 57.2% from 55.9% in the prior month, the Institute for Supply Management (ISDM) said. Readings above 50% signal that businesses are expanding. A similar ISM survey of manufacturers also rose in Dec to a nearly 2½ year high. Manufacturers don’t deal directly with customers & have been better shielded from the virus. 14 of the 18 service industries tracked by ISM expanded in Dec, the same as in the prior month. As expected, business contracted in arts & entertainment, & leisure & hospitality owing to renewed gov restrictions on hours of operation & the number of customers allowed on premise. New orders & production both rose & remained near a pandemic high, but employment fell & turned negative for the first time since Aug. A measure of jobs & hiring, arguably the most critical part of the survey right now, slipped to 48.2% from 51.5%. Although the ISM services index is still relatively high, business is far from normal. The survey asks execs whether conditions are getting better or worse, but it doesn't reveal how much better. The US economy has taken another body blow from the pandemic, but business is holding up much better than it did last spring. States have shied away from broad restrictions to limit the damage. As the vaccines become more widespread & the pandemic fades, the economy is expected to make a stronger recovery. That could still take many months, however.
Service side of U.S. economy speeds up in December, but virus hurts employment
Investors were glad to see a sense of calm in DC & the jobless claims data was helpful. Tech stocks on NAZ participated in the rally but the advance decline ratio is weak, many stocks are not being purchased. Economic data is coming in good, but short of great.
Dow Jones Industrials
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