Dow went up 34 (near session highs), advancers over decliners 3-2 & NAZ gained 100 The MLP index crawled up 1+ to the 176s & the REIT index rose 3+ to the 491s. Junk bond funds dipped slightly & Treasuries remained were weak, bringing higher yields. Oil was higher in the 72s & gold added 2 to 1787 (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)
US job openings unexpectedly climbed to a near-record high in Oct, as employers struggled to attract new workers amid an ongoing labor shortage. The Labor Dept said there were 11M job openings in Oct, the highest number of openings since Jul, when businesses were looking to fill 11.1M positions. It marked an increase from Sep, when there were an upwardly revised 10.6M open jobs. Accommodation & food services – one of the industries hit hardest by the pandemic – accounted for a bulk of the job openings jump with 254K new available positions as the delta variant of COVID-19 showed signs of slowing down nationwide. The gov report, known as the Job Openings and Labor Turnover Survey, also showed the number of people quitting their jobs fell slightly in Oct to 4.2M, from 4.4M in Sep. While it's still the 3rd-highest number of monthly resignations on record, the decline suggests that the great resignation is losing steam. There were just 7.4M Americans counted as unemployed in Oct, meaning there are roughly 3.6M more available jobs than there are available workers. As a result, businesses are chasing down workers to fill the empty slots – meaning that job-seekers have more bargaining power than they've had in decades.
Job openings climb to near-record in October as labor shortage persists
American workers are in line to receive one of the biggest payraises in more than a decade, reflecting an extremely tight labor market and the highest inflation in 30 years. A survey by the Conference Board shows that companies are setting aside 3.9% of total payroll for wage increases next year – the steepest one-year jump since the 2008 financial crisis. The estimate is up from Apr, when the Conference Board projected that companies were budgeting for a 3% pay increase. The report emphasizes the lengths companies are going to in hopes of attracting new workers: Growth in wages for new hires, along with accelerating inflation, were the biggest drivers of the jump in salary increase budgets. Nearly ½ of respondents – 46% – said the increase in wages of new hires played a role in wage increases, while 39% said that increased inflation influenced their decision. On top of projecting higher salaries in 2022, businesses are already raising wages for their employees. The survey showed that average actual raises in 2021 climbed from the Apr survey period to Nov. The average business raised its salary budget by 3% in 2021 so far, up from 2.6% in Apr. Actual raises also climbed from the Apr survey period to Nov. The average business has lifted its salary budget by 3% in 2021, close to the levels seen just before the pandemic shut down the nation's economy in Feb 2020. Increases have been particularly notable for workers under the age of 25 & for people who switched jobs in the past year, suggesting that much of the wage acceleration has been among recently hired employees. Faster wage growth of new hires has led to a phenomenon known as "pay compression," which is when wage premiums for worker experience shrink. As a result, more experienced workers – feeling their pay advantage is no longer significant – go look for a new job, leading to a higher turnover of more experienced workers. Faced with a high turnover rate, employers will raise wages faster for current employees in order to maintain payroll. The US is currently grappling with a record-high quits rate: The Labor Dept reported last month that 4.4M Americans quit their jobs in Sep (about 3% of the nation's workforce). At the same time, higher inflation has shown no signs of slowing down, increasing the need for employers to give workers a bigger cost-of-living adjustment. In this scenario of both hot inflation & a tight labor market, wages are expected to continue rising, with growth remaining well above 4% thru 2022. Wages for new hires, & workers in blue-collar & manual services jobs, are expected to grow faster than average. "A wage-price spiral — where higher prices and rising wages feed each other, leading to faster increases in both — may already be in the works," Gad Levanon, chief economist at the Conference Board, wrote.
US workers poised to get biggest raise in a decade as inflation soars
Pfizer (PFE) CEO Albert Bourla said that people might need a 4th Covid-19 shot sooner than expected after preliminary research shows the new omicron variant can undermine protective antibodies generated by the vaccine the company developed with BioTech (BNTX). PFE & BNTX released results from an initial lab study that showed a 3rd shot is effective at fighting the omicron variant, while the initial 2-dose vaccination series dropped significantly in its ability to protect against the new strain. However, the 2-dose series likely still offers protection against getting severely sick from omicron, the companies said. Bourla noted that a preliminary study by the company was based on a synthetic, lab-created copy of the variant & more data is needed from tests against the real virus. Those real-world results will be more accurate & are expected in the next 2 weeks, Bourla said. “When we see real-world data, will determine if the omicron is well covered by the third dose and for how long. And the second point, I think we will need a fourth dose,” Bourla added. He previously projected that a 4th shot would be needed 12 months after the 3rd dose. “With omicron we need to wait and see because we have very little information. We may need it faster,” he said.
Pfizer CEO says fourth Covid vaccine shots might be needed sooner than expected
Gold futures inch higher, but finish below highest intraday level in past week
US oil prices marked their highest settlement in 2 weeks, finding ongoing support from news suggesting that the omicron variant of the coronavirus may not disrupt economies as much as feared. Prices briefly turned lower in the wake of data showing only a modest weekly decline in US crude supplies & a bigger-than-expected climb in product inventories. British Prime Minister Boris Johnson announced tighter restrictions today to stem the spread of the omicron variant, urging people in England to again work from home & mandating COVID-19 passes for entrance into nightclubs & large events. However, a report from PFE & BNTX said results from an “initial laboratory study” showed that their COVID-19 vaccine neutralized the omicron variant of the coronavirus after 3 doses, or the full 2-dose regimen plus a booster shot. The news helped to ease the risk of a bigger economic impact, which would hurt energy demand. West Texas Intermediate crude for Jan rose by 31¢ to settle at $72.36 a barre, the highest front-month finish since Nov 24. Prices had traded as low as $70.91, after rallying 3.7% yesterday to mark a 2nd straight gain. Feb Brent crude, the global benchmark, added 38¢ (0.5%) to settle at $75.82 a barrel after rising 3.2% a day ago. The contract marked a 5th straight session gain, at the highest finish since Nov 25. The Energy Information Administration (EIA) reported that US crude inventories fell by 200K barrels last week, 2nd weekly decline, as the EIA data had shown a 900K-barrel fall for the last week. Analysts had forecast a larger 1.2M-barrel decline in the latest week. The American Petroleum Institute reported a 3.1M-barrel decrease. The data also showed stocks in the US Strategic Petroleum Reserve declined by 1.7M barrels to 601M barrels last week, while total domestic petroleum stocks inched up by 100K barrels to 11.7M barrels per day. Crude stocks at the Cushing, Okla, Nymex delivery hub, edged up 2.4M barrels for the week.
U.S. oil prices settle at 2-week high as omicron fears ease
There's a lot to evaluate between higher inflation & increased wages. Generally it's not considered good for most people. Additionally, those on fixed incomes only experience inflation. After a lot of selling, the bulls are feeling better this week.
Dow Jones Industrials
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