Dow finished down 3, decliners over advancers 5-4 & NAZ was off 265. The MLP index went up 1+ to 161 & the REIT index fell 1+ to the 394s Junk bond funds continued in demand & Treasuries were higher. Oil rebounded 3+ to the 61s & gold went up 8 to 1733 (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 US economy will recover "really nicely" over the next couple of
years, but this doesn't mean inflation pressures will build, said New
York Fed Pres John Williams. "I don't see inflationary
pressures really building during that time," Williams added. He noted that inflation rates
around the world are very low. In addition, there are still 9M
fewer jobs in the US economy than at the start of the pandemic. If
inflation does surprise to the upside, the Fed has the tools to get
inflation down near the Fed's 2% annual goal, Williams said.
Fed's Williams doesn't expect inflation pressures building over next couple of years
Gold futures ended higher following back-to-back session declines, with support from some safe-haven buying, amid developments in Europe that suggest a longer lockdown period due to a renewed spread of COVID-19. Gold for Apr rose 8 (0.5%) to settle at 1733 an ounce. Yesterday, it shed 0.8% & posted the lowest settlement for a most-active contract since Mar 12. Germany is expected to extend its lockdown to limit the spread of coronavirus to mid Apr, rattling investors who fear that such a move will weigh on the region’s rebound from the pandemic. Weakness in Treasury yields contributed further support for non-yielding gold. The 10-year Treasury note yield was at 1.629%, off 1.3 basis points. Yesterday, gold investors showed little reaction to the first of 2 days of congressional testimony from Federal Reserve Chair Jerome Powell & Treasury Secretary Janet Yellen on the health of the US economy as America wrestles with the impact of the COVID-19 pandemic. In reaction to the US durable goods orders data today, which showed a fall of 1.1% in Feb, gold prices briefly pared their gains then recouped them about a ½ hour later. Meanwhile, separate data showed that the US economy grew faster in early Mar, with the IHS Markit’s flash service index climbing to an 80-month high of 60 from 59.8 in Feb. The data prompted gold to temporarily give up much of its gains.
Gold scores first gain in 3 sessions on safe-haven demand
The US economy grew faster in early Mar as the weather improved, govs loosened coronavirus restrictions & massive federal stimulus was injected into the economy, a new survey showed. Service-oriented businesses such as restaurants, resorts, airlines & hotels posted the steepest increase in business in almost 3 years, according to economic research firm IHS Markit. The firm's “flash” service index climbed to an 80-month high of 60 from 59.8 in Feb. Manufacturers, for their part, are also expanding rapidly, though a shortage of key supplies and delays in obtaining them are hold back growth. The Markit manufacturing gauge edged up to 59 in early Mar from 58.6. Orders are booming as more & more of the US economy reopens. New bookings for manufacturers & service providers jumped to the highest level since the middle of 2014, IHS said. The downside? “Unprecedented supply chain disruptions pushed” prices for raw materials & other supplies higher again. The result is rapidly rising inflation, though from very low levels that prevailed during most of the pandemic. The US economy has the wind at its back. Coronavirus cases have declined sharply, more than a ¼ of all Americans have received at least one vaccination shot & the gov just approved another massive fiscal stimulus bill. The big question is whether prices will decline once the global economy recovers& supply disruptions fade. A prolonged period of higher inflation could throw a big kink in the economy's longer run health.
U.S. economy speeds up in March, IHS Markit shows, and it’s not about to slow down
Oil futures rose, partially recovering from a rout in the previous session after a container ship ran aground in the Suez Canal, halting the flow of Persian Gulf oil thru the crucial waterway. Data from the Energy Information Administration (EIA) , meanwhile, didn’t have much of an impact on prices, even as the figures showed a 5th consecutive weekly increase in US crude inventories. West Texas Intermediate (WTI) crude for May rose $2.41 (4.2%) to $60.17 a barrel. May Brent crude, the global benchmark, rose $2.41 (4%) to $63.20 a barrel. The bounce comes after sharp losses yesterday amid worries over rising European COVID cases & extended lockdowns on the continent stoked worries over the demand outlook. WTI & Brent crude both fell into correction territory yesterday, defined as a fall of 10% from a recent peak. Traffic in the Suez Canal, a narrow waterway that divides continental Africa from the Sinai Peninsula, came to a halt yesterday after the MV Ever Given, a container ship ran aground. Meanwhile, the EIA reported that US crude inventories rose by 1.9M barrels last week. That marked five weekly increases in a row, based on the gov data. The forecast a climb of 1.7M barrels for crude stocks. The American Petroleum Institute reported a 2.9M-barrel increase. The EIA data also showed crude stocks at the Cushing, Okla., storage hub declined by 1.9M barrels for the week.
U.S. oil prices gain nearly 6% as a ship blocks passage through the Suez Canal
Once gain, sellers returned to take prices lower in the PM. The Dow is back to where it was on Mar 10 as the bulls were not able to make their case for higher prices. Selling was heavy in tech shares.
Dow Jones Industrials
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