Dow jumped 247, advancers over decliners a modest 4-3 & NAZ gained 153. The MLP index fluctuated near 171 & the REIT index added 4 to 415. Junk bond funds did little & Treasuries were in heavy demand, bringing lower yields. Oil edged higher in the 63s & gold soared 29 to 1765.
AMJ (Alerian MLP index tracking fund)
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A fresh batch of stimulus checks sent consumer purchases surging in Mar as the US economy continued to get juice from aggressive congressional spending. Advance retail sales rose 9.8% for the month, the Commerce Dept reported. That compared to the estimate for a 6.1% gain & a decline of 2.7% in Feb. Sporting goods, clothing & food & beverage led the gains in spending & contributed to the best month for retail since last May's gain of 18.3%, which came after the first round of stimulus checks. A separate report showed that first-time filings for unemployment insurance plunged, with the Labor Dept reporting 576K new jobless claims for last week. That was easily the lowest total since the early days of the Covid-19 pandemic & represented a sharp decline from the previous week's total of 769K. The estimate was for 710K. As the jobs picture brightened, consumers took their $1400 stimulus checks & spent aggressively. The money came courtesy of the nearly $1.9T American Rescue Plan Act that Congress passed in Mar. The legislation took total stimulus & rescue payments approved in the year since the Covid-19 pandemic began to about $5T, fueled by red ink that fiscal authorities say is necessary to keep the economy running. Spending for the month was broad-based, boosting sales by nearly 28% from Mar 2020 as pandemic-related business closings began. The critical bar & restaurant industry saw a 13.4% surge, thanks to the increasing relaxing of restrictions as Covid vaccines accelerate to a pace of more than 3M a day. Sporting goods spending was the highest percentage gainer at 23.5%, followed by clothing & accessories at 18.3% & motor vehicle parts & dealers at 15.1%. The Mar retail sales report was yet another sign that consumers overall remain healthy & willing to spend, even though increasing amounts of stimulus checks are going towards savings rather than spending.
Retail sales explode in March as consumers use stimulus checks to spend heavily
The number of Americans filing first-time jobless claims last week fell
to the lowest level since the onset of the COVID-19 pandemic, according
to the Labor Dept. Data showed 576K Americans filed for first-time
unemployment benefits last week, down from an upwardly
revised 769K the week prior. The forecast
expected 700K filings. Continuing claims for the latest week, meanwhile, ticked up to 3.731M from 3.727M the
prior week. That number was above the 3.7M that was expected.
Unemployment claims fall to coronavirus pandemic low of 576,000
A slight plurality of Americans support Pres Biden's $2.25T infrastructure plan & favor raising corporate taxes to pay for it. But the plan is much less popular than the relief bill passed earlier this year & there are growing deficit concerns. The CNBC All-America Economic Survey, a poll of 802 Americans, shows 36% of the public give the infrastructure plan a thumbs-up compared with 33% who oppose it. The edge is within the poll’s 3.5% margin of error & it’s about ½ the level of support garnered by Biden's $1.9T American Rescue Plan Act that Congress passed in Mar. A large 31% slice of the public say they don't know enough to venture an opinion, suggesting an opportunity for each political party to make headway. But Americans overwhelmingly support nearly all the details of the plans. For example, 87% of the public back the proposal in the plan to fix roads & bridges, while 82% approve of increasing pay for elderly caregivers & 78% support expanding high-speed broadband. 8 of the 9 parts of the plan surveyed — including fixing the electrical grid & retrofitting buildings & homes to make them more energy efficient — received support from more than 70% of the public. The least popular part — tax rebates & incentives for electric cars & building charging stations — still had majority support. A bare 50% majority of the public supports hiking the corp tax rates to 28% from 21% to pay the plan & it's opposed by 42% of the public. But when asked generally about raising corp taxes, 46% say it's a bad idea because it would raise wages, cost jobs & hike prices. Some 43% back the idea that corp tax hikes should be raised to pay for the plan & because companies “do not pay their fair share.”
CNBC survey shows support for infrastructure much less than previous stimulus
While the economic data brought out buyers, their demand was somewhat muted. Demand for safe haven gold & Treasuries was significant. The obvious problem with the strong economic data was it reduces the need for another stimulus package which is clearly bloated. The latest survey of consumers shows Americans have reservations about this spending.
Dow Jones Industrials
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