Markets extend gains while the Dow lags behind

Dow slid back 55, decliners over advancers 4-3 & NAZ shot up 136.  The MLP index lost 1+ to the 176s & the REIT index rose 4+ to the 471s (record record).  Junk bond funds continued mixed & Treasuries were purchased.  Oil rose to the 69s & gold fell 6 to 1812 (more on both below).

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The highly contagious delta variant of the coronavirus, which continues to make its way into communities across the country, "has all but blunted" the airline industry's path to recovery as travelers rethink their plans again, according to Adobe Analytics.  The highly contagious delta variant of the coronavirus, which continues to make its way into communities across the country, "has all but blunted" the airline industry's path to recovery as travelers rethink their plans again, according to Adobe Analytics.  At the start of the year, consumer confidence in travel picked up as vaccination rates rose across the nation.  The pent-up demand in air travel was a welcome relief for the battered industry with consumers spending $6B in domestic flights in Jun.  This figure was only 5% below pre-pandemic levels.  However, online spending in domestic flight bookings dropped by 13% in Jul, with consumers spending a total of $5.26B.  During the first 3 weeks of Aug, bookings continued to decline at an aggressive pace as consumers starting "taking the Delta variant seriously and once again shifting their travel plans," Adobe Digital Insights lead analyst, Vivek Pandya, said.  From Aug 1-21, consumers only spent $2.9B on domestic flight bookings, down 33% compared to that same time period in 2019.  At the current rate, Adobe expects spending throughout the month of August "to be significantly under July," Pandya said.  "These two months historically have similar spend levels, once again showing that like in 2020, the pandemic will continue dictating the terms."  Ticket prices are starting to decline as demand wanes.  Jul marked the first month when airline ticket prices notched 2019 levels.  However, ticket prices in Aug prices have already started to drop & are 6% below pre-pandemic levels.

Delta variant dampens airline industry's path to recovery, Adobe says

The US is a day away from ending its evacuation mission in Kabul, marking the apparent end of a 20-year attempt to create a stable democracy in Afghanistan.  As of today, Western forces evacuated 1200 out of the Afghan capital on 26 military cargo aircraft flights in a 24-hour period, according to the latest figures from the White House.  Since the mass evacuations began on Aug 14, approximately 117K people have been airlifted out of Afghanistan.  About 122K people have been evacuated since the end of Jul, including about 5500 US citizens & their families.  Today, as many as 5 rockets were intercepted by US missile defenses near Hamid Karzai Intl Airport in Kabul, the site where US forces are sprinting to carry out final evacuation flights since the Taliban gained control of the country 2 weeks ago.  White House press secretary Jen Psaki said that Pres Biden was briefed on the rocket attack & reconfirmed that commanders should prioritize the protection of US forces on the ground.  The Pentagon said Sat that it had begun its retrograde process — the withdrawal of US service members. Pentagon spokesman John Kirby said that less than 5000 service members remain in Afghanistan, adding that the US would no longer provide an exact number due to security conditions.  Kirby said the US is communicating with the Taliban about the evacuation mission.  “Our commanders on the ground remain in communication with Taliban leaders around the airfield to deconflict and to prevent miscalculations and misunderstandings, and so far that communication has been effective,” Kirby added.  When asked about the security situation, Kirby described the threats as dynamic but added that the US will “maintain the capability to protect ourselves and defend ourselves as we continue to complete the retrograde.”

U.S. winds down Kabul mission after helping evacuate 116,000 people in just over 2 weeks

A new CDC presentation says the data needed to properly evaluate Covid-19 vaccine booster shots for the general population is limited — even as Pres Biden pressures health officials to clear the shots for wide distribution beginning the week of Sep 20.  Slides published ahead of a presentation at a Centers for Disease Control & Prevention (CDC) advisory group meeting today suggest the panel may limit its initial endorsement of extra shots to vulnerable groups & health-care workers.  Several studies suggest the authorized Covid vaccines remain effective in preventing severe disease & hospitalization but may be less effective in preventing infection or mild symptomatic illness, according to the slides submitted by CDC scientist Dr Sara Oliver.  The CDC’s Advisory Committee on Immunization Practices is meeting today to consider booster shots for all eligible Americans.  They are also scheduled to vote on endorsing the Food & Drug Administration's final approval of Pfizer's (PFE) vaccine.  Since the highly contagious delta variant first appeared, vaccine efficacy has ranged between 39-84%, according to the presentation, which referenced several separate studies.  One study looking at health-care workers & first responders showed overall vaccine efficacy fell to around 65% in Jul – down from about 90% in Feb.  Israel data shows the efficacy of PFE vaccine has fallen to as low as 39% in that country.  Scientists have said the vaccines' effectiveness wanes over time & the delta variant is a hardier strain that is able to break thru that protection.  It is “important to monitor trends of effectiveness by severity of disease over time,” the slides added.  The slides noted that it is not uncommon for vaccines to require several doses. Vaccinations for Hepatitis B & HPV, for example, require a 3rd dose after 6 months.  Once booster shots are available, nursing home residents, health-care providers & the elderly — the first groups to get vaccinated in Dec & Jan — are likely to be prioritized for the extra shots.  The CDC emphasized that vaccinating the unvaccinated should be a “top priority,” adding delivery of booster doses to vaccinated individuals should not deter outreach to those who remain unprotected from the virus.

CDC scientist says there’s limited data to evaluate Covid booster dose

Gold futures ended lower, but held their ground above the important $1800 threshold after ending last week at their highest price in nearly 4 weeks.  Bullion prices had taken a leg higher on Fri after Fed Chair Jerome Powell, speaking virtually to the Jackson Hole central-bankers symposium, revealed that he supports tapering the pace of bond purchases this year, but continued to see high inflation as “transitory.”  He also emphasized that the start of the tapering process wouldn't be intended as a signal that interest-rate increases were imminent.  The speech was seen as positively supporting continued buying of precious metals.  A downturn in the $ following Powell's remarks also added to the appeal of $-pegged assets, which are comparatively cheaper to overseas buyers as the $ softens.  Dec gold fell $7 to settle at $1812 an ounce, following a weekly gain of 2% based on the most-active contract.  On Fri, gold finished at the highest since Aug 2. 

Gold futures end lower, but prices hold above $1,800 to start week

Oil & gasoline futures settled higher, as traders continued to monitor disruptions to energy operations in the Gulf of Mexico region in the wake of Hurricane Ida, which has been downgraded to a tropical storm.  Ida hit the Gulf Coast as a Category 4 hurricane on yesterday, leading to oil & natural-gas operational shutdowns in the region.  The Bureau of Safety & Environmental Enforcement reported today that an estimated 94.6% of oil production & 93.6% of natural-gas production, in Gulf of Mexico oil production has been shut in.  West Texas Intermediate crude for Oct rose 47¢ (0.7%) to settle at $69.21 a barrel.  The front month Sep gasoline contract, which expires at the end of tomorrow's session, ended at $2.31 a gallon, up 4¢ (1.7%).

Oil, gasoline futures settle higher as traders monitor storm disruptions to Gulf of Mexico energy operations

The week prior to Labor Day can be quiet for the stock market with some traders away on holiday.  This time there is a tense quality out there.  Today the Dow clearly did not participate in the rally by tech stocks & the advance/decline ratio was negative.  Now Ida is moving over land which slows the storm.  Work is starting on bringing back power to New Orleans & getting oil rigs back on line in the Gulf.  Afghanistan is a confusing mess which shows no signs of getting better for some time.  As said so many times here, the virus keeps fighting its war.  However most popular stock averages are at or near record highs.  The overbought stock market should take some time to rest.  It needs rest.  Sep is traditionally the weakest month for stocks.

Dow Jones Industrials