Dow slid back 152 (finishing at session lows), advancers modestly ahead of decliners & NAZ slid back 13. The MLP index went up 1 to the 201s & the REIT index added 1 to the 256s. Junk bond funds rose & Treasuries continued in demand. Oil was off slightly to the high 69s & gold remained about even at 1893 (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)
One of the country's largest retail trade groups, the National Retail Federation (NRF), boosted the industry's outlook for the year, saying it anticipates “the fastest growth that we’ve seen in this country since 1984.” Retail sales are expected to grow 10.5-13.5% to an estimated total of $4.4-$4.6T in 2021, as the economy rebounds from the pandemic & customers spend money they have socked away, NRF's Chief Economist Jack Kleinhenz said. That forecast includes store & online sales, but excludes automobile dealers, gas stations & restaurants. That compares with $4.0T in total retail sales in 2020. The industry group had forecast in Feb that retail sales would rise 6.5-8.2%, amounting to more than $4.3T in sales for the year. NRF also increased its projection for full-year GDP growth to about 7%, compared with 4.4%-5% it expected earlier this year. It said it anticipates pre-pandemic levels of output to return in this fiscal qtr. Kleinhenz said gov stimulus has flowed thru the economy & into consumers’ wallets. That’s fueled shoppers' appetite for spending & a quicker-than-expected recovery, he said. “We are seeing clear signs of a strong and resilient economy,” he said, adding that households “are ready to resume some normalcy of living, working and playing.” Despite the rosy forecast, the retail industry still faces challenges, including inflation, congested ports & a shortage of workers. US retail sales stalled in Apr, after soaring by 10.7% in Mar, according to the Commerce Dept. Retail sales in May have not yet been announced. It is also unclear how much of consumers' wallets will shift to services & other spending priorities, such as hotel stays, plane tickets & dining out, instead of on consumer goods.
Retail trade group sees fastest industry sales growth since 1984
½ of Americans aged 12 & older are now fully vaccinated, according to data published by the Centers for Disease Control & Prevention (CDC). The 7-day average of daily infections held below 15K as of yesterday, according to Johns Hopkins University, a level not seen since the early days of the pandemic. About 52% of the US population has received at least one dose of a Covid vaccine & 42% is fully vaccinated, CDC data shows. Those numbers jump to 61% with one shot or more & 50% fully inoculated for the eligible 12 & older population. The US is reporting just over 1M shots per day on average over the past week. Though the pace has ticked upward in recent days — which may represent a rebound from a dip over Memorial Day weekend — average daily shots have been falling somewhat steadily from peak levels in mid-Apr. At that time, the country was reporting more than 3M daily vaccinations. About 14K daily cases are being reported in the past week. That figure is down 17% from a week ago. The US is reporting 427 daily Covid deaths, based on a 7-day average of Hopkins data.
Half of Americans 12 and up fully vaccinated, average daily cases below 15,000
A group of House Reps is urging the Biden administration to end the federal unemployment benefits program that
provided out-of-work Americans with an extra $300 a week, warning the
enhanced aid is hampering US recovery from the coronavirus pandemic. In a letter, 4 GOP lawmakers called on
the White House to end the jobless supplement before it officially
expires on Sep 6, citing anemic job growth & a burgeoning
labor shortage. "Enhanced unemployment benefits and public school closures in certain
states are weighing down an American economy trying to rebound from the
COVID-19 pandemic," the Reps – led by Rep James Comer –
wrote. "It is past time for Americans to get back to normal. It is past
time to end the stay-at-home bonus, reopen schools for full in-person
instruction, and incentivize Americans to get back to work." The
letter comes on the heels of the May jobs report, which revealed that
employers added 559K jobs last month, missing expectations for a gain of 650K. It marked the 2nd
consecutive miss for job creation: In Apr, the economy added a revised
278K jobs, much smaller than the 1M forecast. There remain 7.6M fewer jobs than in Feb 2020, before the pandemic began. The lackluster payroll growth has ignited concerns about a labor
shortage & its potential impact on the economy's rebound from
the pandemic. Employers are struggling to fill available positions – in
Apr, there were a record 9.3m open jobs – forcing them to
reduce hours, pay overtime & raise prices.
GOP lawmakers demand Biden end extra federal unemployment benefits
Gold futures ended higher, supported in part by a retreat in yields for benchmark Treasury yields, but prices held below $1900 an ounce a day ahead of a US inflation reading that could drive the precious metal's next big move. The May reading of the US consumer-price index is due tomorrow. The headline consumer price index is expected to rise by an outsized 0.5% in May & 4.8% for the year. A hotter-than-expected Apr CPI reading, which showed prices rose 4.2% year-over-year, briefly rattled markets last month. Aug gold rose $1 to settle at $1895 an ounce, following a modest decline yesterday, which marked bullion's first decline in 3 sessions. Today's trading for precious metals comes as the 10-year Treasury yield hit its lowest level since around Mar. Meanwhile, the $ steadied, after touching lows under a key level at 90, as gauged by the ICE US Dollar. Bullion has been particularly sensitive to moves in the $ & a rise in gov debt yields, which can undercut appetite for precious metals.
Gold scores a modest gain as investors await U.S. inflation data for direction
US oil futures logged a modest loss, to finish below the $70 mark following data that showed domestic crude inventories down a 3rd-straight week, but gasoline stockpiles up by 7M barrels. Gasoline futures led the percentage losses among major energy futures for the session, as data also revealed that implied demand for the fuel edged lower for the week. The Energy Information Administration reported that US crude inventories fell by 5.2M barrels last week. That was larger than the decline of the 4.1M barrels forecast. The American Petroleum Institute yesterday reported a 2.1M barrel decrease, according to sources. West Texas Intermediate (WTI) crude for Jul fell 9¢ to settle at $69.96 a barrel. WTI ended yesterday above $70, at its highest since Oct 2018, based on the front-month contracts, Aug Brent crude, the global benchmark, settled at $72.22 a barrel, unchanged from yesterday which saw the highest finish since May 2019. Oil prices yesterday had finished higher as economic reopening efforts across in much of the world in the wake of the coronavirus pandemic fed expectations for a continued improvement in energy demand. Prices got an added boost yesterday from comments from Secretary of State Antony Blinken which eased concerns that a return of the Iran nuclear deal would lead to the the lifting of US sanctions, allowing Iran to contribute more oil to the world market. On Tues, Blinken said that even if the US & Iran reach a deal, “hundreds of sanctions will remain in place,”
U.S. oil prices end below $70 as domestic gasoline supplies jump, fuel demand fallsDiscord in Congress is not welcomed by investors. The bulls have to be greatly disappointed by the lack of attention the favorable outlook for retail sales received. Of course, everybody is on pins & needles waiting for the inflation data tomorrow, especially since the forecast is gloomy. With selling into the close, nerves are on edge.
Dow Jones Industrials
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