Dow gained 64, advancers over decliners better than 4-3 & NAZ added 12. The MLP index was off 1+ to the 186s & the REIT index went up 3+ to 436 (in record territory). Junk bond funds did little & Treasuries remained in demand. Oil slid back to the 36s & gold rose 6 to 1905 (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 White House unveiled a $6T budget proposal for next year that adds to the nation's ballooning debt as Pres Bisen pushes a sweeping economic agenda to dramatically expand the gov-funded social safety net. The fiscal 2022 budget request tallies up the administration's eight-year, $2.3T American Jobs Plan & the $1.8T American Families Plan & incorporates them into Biden's $1.5T request for annual operating expenditures, which includes the Pentagon & other federal agencies. The proposal, which will push debt levels in 2024 held by the public to the highest levels since World War II – will likely give fresh fodder to Reps who have criticized the size & scope of Biden's spending proposals. Under the plan, the deficit would hit $1.8T in 2022 & would routinely run above $1.3T over the next decade, despite nearly $3T in proposed tax increases. The gap between what the gov spends & what it collects in revenue would grow to nearly $1.6T by 2031. Total debt held by the public would more than exceed the annual value of the entire economy by 117% in 2031, the highest level in close to a century. Biden is pushing to raise the corp tax rate to 28% from 21%, nearly double the capital gains tax rate paid by wealthy Americans, restore the top individual income tax rate to 39.6% & impose a global minimum on US companies foreign profits as part of his 2-pronged economic agenda. "Now is the time to build the foundation that we’ve laid, to make bold investments in our families, in our communities, in our nation," Biden said. "We know from history that these kinds of investments raise both the floor and the ceiling of an economy for everybody." Still, the budget is merely a proposal, whether or not it's ultimately implemented hinges on Congress. Rep lawmakers have balked at the scale of Biden's spending plans & have unified to protect the 2017 tax law from any potential rollbacks. Some moderate Dems have also raised concerns about Biden's proposed tax hikes, warning that higher rates could derail the nascent economic recovery from the coronavirus pandemic.
Biden proposes $6T budget that will keep deficits near record highs
Senate Reps halted an effort to form a bipartisan Jan 6 commission to investigate the Capitol attack, marking the first successful legislative filibuster mounted by the GOP minority. The
legislation needed 60 votes to overcome a GOP filibuster, but
Reps blocked the legislation from advancing during a procedural
vote. The vote was 54 to 35. Just 6 Reps joined with Dems. The House already passed legislation on May 19 to form the independent panel with support from 35 Reps, despite opposition from former Pres Trump & House Minority Leader Kevin McCarthy. But the legislation faced an uphill climb in the 50-50 split Senate, with Senate Minority Leader Mitch McConnell also opposing the commission. McConnell argued there are already enough investigations into the Jan 6 attack. "I do not believe the additional, extraneous ‘commission’ that
Dem leaders want would uncover crucial new facts or promote
healing," McConnell said. "Frankly, I do not believe it is even
designed to." The GOP filibuster on the Jan. 6 commission means the legislation is likely dead for now. But its failure
will be sure to intensify pressure on Dems to abolish the
legislative filibuster altogether & just require a simple majority
vote to advance future legislation.
Senate Republicans slam brakes on bill to create commission probing Capitol riot
Roughly ½ of all Americans have received at least one dose of a Covid vaccine, based on Centers for Disease Control & Prevention (CDC) data published, as nationwide infection levels continued their downward trend. New Covid cases are 23K per day, on a 7-day average, down 21% from a week prior, according to Johns Hopkins University. CDC data shows 49.9% of the US population has received one shot or more, with 40% having completed a full vaccination program. New Covid cases are 23K, down 21% from a week prior, according to Johns Hopkins University. Case counts have not been this low since Jun 2020. About 1.6M vaccine shots have been reported administered each day on average over the past week. The latest 7-day average of daily US Covid deaths is 667, though the release of backlogged data from multiple states in recent days obscures the latest trend.
Nearly 50% of Americans have at least one vaccine shot as Covid case counts fall
Gold futures climbed to score a weekly & monthly advance, with prices back above the the psychologically important level at $1900 an ounce. Data today showed the headline US personal consumption expenditure inflation measure climbed 3.6% in Apr from the prior year, the strongest reading since 2008 & higher than the 2% preferred by the Federal Reserve. Gold futures on Wed settled above the $1900 mark for the first time since early Jan, to turn higher for the year, but slipped below that level by the end of yesterday's session. Aug gold, the most active contract, rose $6 (0.4%) to settle at $1905 an ounce, following a 0.3% decline yesterday which marked its first loss in 4 sessions. Prices, based on the most-active contract, settled at their highest since Jan 7, up 7.8% for the month, notching a weekly advance of 1.5%. The rise in precious metals prices this week has been helped by a weak $ but the currency was gaining today, up 0.1%. A weaker $ can make assets priced in that currency more attractive to overseas investors. A slide in the yield on the 10-year Treasury note had also helped buoy gold buying.
Gold futures settle back above $1,900, ending the month nearly 8% higher
Oil futures saw choppy trading, with US prices ending the session lower following 5 consecutive session gains, but prices tallied a rise for the week, as well as the month of May. The moves for oil come just a day after prices for US benchmark crude marked their highest settlement since 2018. West Texas Intermediate (WTI) oil for Jul declined by 53¢ (0.8%) to settle at $66.32 a barrel. Front-month contract prices gained more than 4% for the week, as well as the month. Aug Brent, which is now the front month, fell 48¢ (0.7%) to settle at $68.72 a barrel. Based on the front-month contracts, WTI crude rose 4.3% for the week, as well as the month. Brent saw a weekly advance of 4.8% & monthly climb of 3.5%. Some commodity experts expect that OPEC+ may adjust its plans to ease output limits based on expected Iranian production, with negotiations between the US & Tehran under way since Apr. the recovery in the US from COVID is giving way to rising demand for crude & its byproducts. Data from the Energy Information Administration showed weekly declines for domestic crude, gasoline & distillate supplies. Still, Baker Hughes reported that the number of active US drilling rigs for oil was up a 4th straight week, up 3 at 359 this week, implying that an increase in oil production may be on tap.
Oil futures end mixed, score gains for week and month
Dow Jones Industrials
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