Dow shot up 103, decliners modestly ahead & NAZ gained 162. The MLP index inched higher in the 167s & the REIT index went up 2+ to the 395s. Junk bond funds remained in demand & Treasuries rose in price, taking yields lower. Oil was flattish in the 61s & gold fell 2 to 1739 (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)
Federal Reserve Chair Jerome Powell said the coronavirus pandemic exposed weaknesses in the global payment system, including the delays in stimulus check deliveries to Ms of Americans. The federal gov took about 2 weeks to start distributing the first round of $1200 cash payments in Apr & about one week to send the 2nd round of checks, worth $600, in Jan. But with the severity of the crisis, which forced an unprecedented shutdown of the nation's economy, causing the unemployment ranks to swell in a matter of days & Powell said that timing was essential. "You could see spending pick up immediately after the payments arrived," he added. "So people were really, with their companies closed down and on furlough, they were in need of quickness." Powell also said the pandemic highlighted the disparate impact of "so many things" on poor & lower-income communities & showed the need for great inclusiveness in the US financial system. For instance, he noted that lower-income Americans were less likely to have access to remote access to financial services, even though they were in dire need of support. "It underscores what is already a high priority for us," he said. "Which is the need to have a greater, more inclusive payment system and a more inclusive economy.'
Fed's Powell says delayed stimulus payments bring short-term challenges
New cases of Covid-19 are once again on the rise across more than ½ of the US as officials race to vaccinate additional people before highly contagious variants become prevalent in the country. The 7-day average of new cases rose by 5% or more in 27 states, according to Johns Hopkins University. Across the US, the nation logged an average of 54K new cases per day over the past week — a 1% rise from the prior week after months of rapidly declining case numbers. Even as the US picks up the pace of vaccinations, giving about 2.5M shots every day, some health officials have warned the country remains in a precarious spot. The lifting of restrictions in many states & the spread of more contagious variants in the US threaten to undo the nation's progress, which has seen cases, hospitalizations & deaths all fall dramatically since the peak earlier this year. Lifting restrictions is a “serious threat to the progress we have made,” Dr Rochelle Walensky, director of the Centers for Disease Control & Prevention, said. She said she's worried about an unavoidable surge in cases. “We are at a critical point in this pandemic, a fork in the road.” Daily new deaths continue to fall, likely helped by the prioritization for vaccination of the elderly & those with comorbid conditions who are most likely to die of Covid-19. About 68.8% of those 65 & older have received at least one shot of a vaccine, according to the CDC. In total, more than 124M doses have been administered, but most of those are for 2-dose vaccines. As optimism around the steady rise in vaccinations picks up, many states have begun to ease restrictions on businesses & gatherings, despite warnings from the CDC not to do so.
Covid cases rise across more than half of U.S. as country races to vaccinate
Gold futures finished lower, with strength in the stock market led by gains in technology stocks partly to blame for the metal's fall from last week's highest settlement since late Feb. A collapse in the Turkish lira also contributed to losses for gold, with the weaker currency likely to dull the yellow metal's demand from Turkey, which is a major buyer. A report from the World Gold Council in Jan showed that Turkey was the biggest annual gold buyer in 2020, adding 135 metric tons to its official gold reserves. Against the backdrop, gold for Apr fell $3 to settle at $1738 an ounce, after prices saw a 1.3% weekly rise put in on Fri —the 2nd weekly gain in a row. Prices on Fri also finished at the highest for a most-active contract finish since Feb 25. Bullion’s move lower to start the week comes even as Treasury yields & the $ are staging a modest pullback that would ordinarily offer a runway for gold prices. Commodity experts speculated that gold prices were facing selling pressure, nonetheless, because investors were favoring equities as the rise in bond yields appeared to stabilize somewhat. Turkey’s currency & stocks collapsed after the abrupt termination of its central bank head.
Gold prices finish lower as tech stocks rise, Turkish lira collapses
The US economy contracted in Feb for the first time since the worst phase of the coronavirus pandemic last Apr, according to the Chicago Fed's national activity index. The index, which is designed to gauge overall US economic activity, fell to negative 1.09 in Feb from a revised positive 0.75 in the prior month. A zero value of the index indicates the national economy is expanding at its historic trend rate of growth. The Jan reading was revised from an initial estimate of 0.66. The 3-month moving average, which is designed to smooth volatility, decreased to negative 0.02 last month from positive 0.46 in Jan. The Chicago Fed index is a weighted average of 85 economic indicators. Only 34 of the indicators made positive contributions last month. Production-related indicators contributed negative 0.85 to the index in Feb, down from positive 0.37 in Jan. Winter storms played a part in industrial production falling 2.2% in Feb. The personal consumption & housing category contributed negative 0.29 to the index last month, down from positive 0.27 in Jan. With all the talk about how well the economy might do in H2, there is not much attention on the struggles of growth in Q1. The data suggest that the Biden $1.9T stimulus package was more timely than assumed.
U.S. economy contracted in February, Chicago Fed index shows
Crude-oil futures posted a modest gain, finding support after suffering from their largest weekly loss since Oct. Worries over renewed lockdowns & a sluggish vaccine rollout in parts of Europe continued to dog energy markets but oil already priced in a lot of COVID worries last week. Questions around the safety of the vaccine had led to its suspension in parts of Europe, raising expectations for an economic slowdown that would hurt energy demand. West Texas Intermediate (WTI) crude for Apr rose 13¢ to settle at $61.55 a barrel. The Apr contract expired at the end of today's session. May WTI crude, the most-actively traded contract, added 12¢ to $61.56 a barrel. Meanwhile, May Brent, the global benchmark, edged up by 9¢ at $64.62 a barrel. Last week, WTI crude lost 6.4%, while Brent declined by 6.8%, the largest losses since Oct for both benchmarks. Data from Baker Hughes on Fri, however, showed the number of active US rigs drilling for oil climbed by 9 to 318 last week. That was the largest weekly climb since Jan, implying a likely rise in future production.
Oil prices post a modest gain after largest weekly slide since October
The popular averages had a good day, but many stocks did not participate with advancers & decliners about even. NAZ is still about 5% below its highers last month. The data from the Chicago above was discouraging for investors.
Dow Jones Industrials
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