Dow dropped 12 not far from session lows, decliners over advancers about 5-4 & NAZ fell 7. The MLP index was flat at 1912 & the REIT index went up 3+ to the 483s. Junk bond funds remained weak & Treasuries had more selling. Oil crawled higher nearing 81 & gold was about even at 1868 (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)
Demand for air travel is on the rise ahead of the holidays. So are the costs. Jet fuel hasn't been this expensive since 2014. Airlines also racing to hire thousands of employees to meet growing demand: pilots, flight attendants, reservations agents, baggage handlers & many others, competing in a tight labor market that would have seemed impossible in the early days of the coronavirus pandemic. And, airlines have run through much of the $54B in gov payroll aid that helped cover their labor bills during the crisis. The rise in costs is threatening the industry's attempt to return to profitability after losing a record $35B last year when the pandemic snapped a decade of profits. For passengers, the combination of returning demand & higher costs could mean more expensive ticket prices ahead. Benchmark US jet fuel was $2.27 a gallon on Nov 10, up 25% from 3 months earlier. Airlines eager to cash in on a return to demand have tried to balance — with varying degrees of success — how much they can fly with their current staffing levels. Overall, US carriers will fly about 6% less in Nov & Dec compared with 2019, before the pandemic, according to aviation data & consulting firm Cirium. Low-cost airline are exceptions, with more capacity scheduled than they did 2 years ago. The ramp-up has been bumpy Airfares haven't fully caught up to the rise in costs, partly because intl & corp travel are still below pre-pandemic levels. Despite the surge in consumer prices in Oct that the Labor Dept reported last week, airfares were down 4.6% from a year earlier, though they rose 3.5% from Sep to Oct.
Airlines are gearing up for a busier — and costlier — holiday season as fuel prices rise
Covid-19 cases are starting to climb again in select regions across the US after stabilizing at a high level following this summer's delta surge, White House chief medical advisor Dr Anthony Fauci said. His comments came just a day after the country reported a 7-day average of more than 82K new cases, up 11% from the week before, according to data from Johns Hopkins University. Nationwide cases were down 57% last week from the delta wave's peak this summer, but a jump in Covid patients in the Midwest & Northeast is fueling the sudden increase. “The only thing that’s a little bit disconcerting is that we’re beginning to plateau,” Fauci said. “In other words, the deceleration of cases is now plateaued, and in some areas of the country, we’re starting to see a bit of an uptick.” Infections had been on the decline for weeks after hitting a delta wave peak of 172K new cases per day on Sep 13. They flattened out at a high level, bouncing at 70-75K new cases a day for nearly 3 weeks thru most of last week & are now once again increasing. Average daily cases have jumped by 19% & 37% in the Midwest & Northeast over the last week, respectively. Hospitalizations, which lag an increase in infections, are up 11% over that same period in the Midwest, while the number of currently hospitalized patients with Covid is flat in the Northeast. Cases & hospitalizations have fallen sharply in the South, where the delta wave hit earliest & hardest over the summer. About 47K patients with the virus are currently hospitalized nationwide, according to a 7-day average of data from the Dept of Health & Human Services, & the US is reporting an average of roughly 1150 Covid fatalities per day. Both figures are flat over the past week.
Dr. Fauci says Covid cases are starting to climb in some areas of the U.S.
Gold futures settled with a loss, halting a 7-session run
of advances for the precious metal that has been buoyed by fears about
post-COVID inflation pressures. Dec gold edged down by $1 to settle at $1866 an ounce,
following a weekly advance of nearly 2.9%, representing the best such
gain since the period ended May 7. Gold's 7-day streak had been the
longest for a most-active contract since a 9-day rise that ended on
Jul 2020. A rise in the $ & strength in Treasury yields put pressure on prices for the yellow metal. The $
was up 0.3%, while the 10-year Treasury note yield was 1.614%, up from 1.583% on Fri. A stronger $ can pressure demand for assets priced in the currency. Higher
yields in gov debt can dull interest in gold, which doesn't offer
a coupon. On top of those bullish factors for bullion, fears of out-of-control
inflation, sparked by supply-chain bottlenecks & a demand surge, have
helped to bolster appetite for the precious commodity. Gold is seen as a
hedge against rising inflation.
Gold rings up first loss in 8 sessions
Oil futures kicked off the week on a soft note, with the US
benchmark spending time below $80 a barrel, as traders assessed the
possibility that the Biden administration will release crude from the
Strategic Petroleum Reserve (SPR). Sen Chuck Schumer said the administration should tap the reserve
to help bring down gasoline prices ahead of the holiday season. Thanksgiving in the US, a busy travel period, is next Thurs. Dec West Texas Intermediate oil tacked on 9¢ to settle at $80.88 a barrel. Prices traded as low as $79.30, the lowest
intraday level for a front-month contract since Nov 5. Jan Brent crude,
the global benchmark, was down 64¢ (0.8%) to $81.53 a
barre. Both grades fell for a 3rd straight week
last week. The speculation around a potential SPR release
appears to have done little to shake up key members of OPEC+. Energy ministers from Saudi Arabia & Oman
over the weekend said they saw no need for OPEC+ to speed up production increases beyond the
monthly increments of 400K barrels a day they have already penciled
in. There's also been talk that the US may consider a ban on oil exports as a way to help ease gasoline prices.
The major retailers will be reporting earnings this week & investors are eager to see the results & forecasts for the future. Dow began the day up about 200, then sellers returned to drag it into the red. The bulls are happy to see it hold above 36K. Meanwhile gold is up 85 this month.
Dow Jones Industrials
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