Dow dropped 126, advancers over decliners 5-4 & NAZ went up 67. The MLP index rose 3+ to the 199s & the REIT index jumped 6+ to the 453s (another record). Junk bond funds hardly budged & Treasuries saw limited selling. Oil was off 40¢ in the 69s & gold gained 10 to 1902 (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 Federal Reserve is in the early stages of a campaign to ready markets for reducing its $120B in monthly asset purchases to stimulate the economy. Comments by Fed officials in the past several weeks suggest the issue of tapering looks likely to be discussed as soon as next week's meeting & the Fed may be on track to begin asset reductions later this year or early next year. At least 5 Fed officials have publicly commented on the likelihood of those discussions in recent weeks, including Patrick Harker, pres of the of the Federal Reserve Bank of Philadelphia, Robert Kaplan of Dallas, Fed Vice Chair for bank supervision Randal Quarles & Cleveland Fed Pres Loretta Mester, whose comments came after the Fri monthly jobs report. “As the economy continues to improve, and we see it in the data, and we get closer to our goals … we’re going to have discussions about our stance of policy overall, including our asset purchase programs and including our interest rates,” Mester said. While the discussion may take place, an announcement of a decision to actually taper would be several months later, perhaps in late summer or early fall. That announcement would then put the beginning of the asset reduction further out, perhaps by year-end or early next year. Since the Fed will taper its purchases, that is, reduce the amount it buys by some amount each month, that timeline would still see the Fed purchasing Bs of $s of assets well into 2022, though at an increasingly slower pace.
The Fed is in early stages of a campaign to prepare markets for tapering its asset purchases
The US is reporting an average of about 14K daily infections over the past week, data compiled by Johns Hopkins University shows, as average daily cases have held below 15K for 3 days straight. About 960K vaccinations are being reported administered each day nationwide, according to a 7-day average of Centers for Disease Control & Prevention (CDC) data. More than ½ of Americans have received at least one dose of a vaccine & 42% are fully vaccinated. The US is reporting an average of 14K daily new infections over the past week, numbers not seen since the early days of the pandemic. Average daily case counts have declined by 5% or more in 44 states over the past week. About 960K vaccinations are being reported administered in the US on average over the past week, CDC data shows. That figure has bounced between 900K-1.1M over the past few days & is down 27% from a week ago. The latest 7-day average of daily US Covid deaths is 455. Roughly 52% of the population has received at least one shot & 42% is fully vaccinated. Of those aged 18 & older, 63.5% are at least partially vaccinated.
U.S. reports about 15,000 cases, 1 million vaccinations per day on average
The Food & Drug Administration (FDA) approved Biogen's (BIIB) Alzheimer's drug,
marking the first new authorized therapy to treat the disease in nearly 2 decades. The drug, Aduhelm (aducanumab), had received mixed reviews
following earlier clinical trials. Dr. Patrizia Cavazzoni, director of the FDA Center for Drug
Evaluation & Research, said the agency used the Accelerated Approval
pathway, which is when the FDA "approves a drug for a serious or
life-threatening illness that may provide meaningful therapeutic benefit
over existing treatments when the drug is shown to have an effect on a
surrogate endpoint that is reasonably likely to predict a clinical
benefit to patients and there remains some uncertainty about the drug’s
clinical benefit." The drug, which is the first approved for
Alzheimer's since 2003, works to remove sticky deposits of a protein
called amyloid beta from the brain. Cavazzoni said in her statement that
the clinical trials for Aduhelm were the first to show that a reduction
in these plaques is expected to lead to a reduction in the clinical
decline of patients. The Alzheimer's Association called the approval "the beginning of a completely new future for Alzheimer's treatments." The stock surged 108 to 395.
If you would like to learn more about BIIB, click on this link:
club.ino.com/trend/analysis/stock/BIIB?a_aid=CD3289&a_bid=6ae5b6f7
FDA approves Biogen’s Alzheimer’s drug
Gold futures booked back-to-back gains, finding some support from a decline in the $, but prices finished below the key $1900 for a 3rd session in a row. Gold for Aug rose $6 (0.4%) to settle at $1898 an ounce after reaching intraday highs just under $1900. Prices for the most-active contract climbed 1% on Fri, but haven't settled above $1900, which is seen as a key resistance level, since Wed. After the settlement, however, prices in electronic trading inched up a bit further to surpass that $1900 mark.
Gold prices notch back-to-back gains, but settle below $1,900/oz
Oil futures ended lower, turning south after the US crude benchmark briefly touched the $70-a-barrel threshold for the first time in more than 2½ years. Prices took a directional cue from a fall in China's crude-oil imports from a year ago, as traders weighed the potential for Iran nuclear deal that would likely lead to more oil in the world market. West Texas Intermediate (WTI) crude for Jul fell 39¢ (0.6%) to settle at $69.23 a barrel after hitting a session high of $70 in early action. WTI last traded at $70 or above in Oct 2018, based on action for the most-active contracts. Aug Brent crude, the global benchmark, lost 40¢ (0.6%) at $71.49 a barrel. Baker Hughes on Fri reported that the number of active US drilling rigs was unchanged that week, implying that the higher prices of oil aren't prompting US producers to boost production. Also, the Energy Information Administration on Thurs reported that total oil production edged down by 200K barrels to 10.8M barrels per day for the week ended May 28.
Oil ends lower after U.S. futures briefly touch $70 a barrel
The recovery is bringing problems, winding down various gov programs which are no longer needed. Nervous investors are hesitant about buying stocks, so they buy gold. That can limit upside potential for the stock market.
Dow Jones Industrials
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