Dow shot up 196, advancers over decliners about 5-2 & NAZ gained 131. The MLP index crawled up 1+ to the 172s & the REIT index slid back 1+ to the 494s. Junk bond funds continued higher & Treasuries finished lower with higher yields. Oil rose 1 to the 73s & gold climbed 7 to 1810 (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)
Sales of those homes in Nov came in well below analysts
expectations, down 14% from a year ago. And Oct's sales numbers were
revised to the lowest level since the start of the pandemic, according
to the Census Bureau. Despite slowing sales & rising mortgage rates, the median price of
newly built homes sold in Nov rose nearly 19% from Nov 2020. This came even as the supply of new homes rose. However, with inventory in
existing homes historically low, prices in newly built homes are
continuing to jump. The question for now is, how high is too high? Prices for existing homes sold in Nov were up just over 13% year
over year, a slight increase from the annual gain in Oct, according
to the National Association of Realtors. Prices are higher because inventory for existing homes is much lower, with barely a 2-month supply at the current sales pace. The
median is also skewing higher because of the mix of homes selling,
which are in large part pricier homes. Even repeat sale price indices show prices up close to 20% from a year ago. New
homes prices are soaring because there is so little available on the
resale market but more because of rising material costs for builders. They're passing those costs onto buyers. After peaking last spring & falling dramatically over the summer,
the cost of lumber is now on the rise again. Its price is now double
what it was at the start of Nov, when the Commerce Dept
announced it would double import duties on Canadian lumber in 2022. Homebuilders
have also been slowing sales due to supply chain issues, as they don’t
want to sell a home that they can't deliver on time. While realtors are
expecting lower existing home sales next year due to rising mortgage
rates & continued high prices, builders are more bullish. Builder
sentiment rose to the highest level of the year in Dec (tied with
Feb). It is possible that the sales numbers will be revised, as the Census survey has a wide margin of error.
Sales of newly built homes tank as affordability hits buyers
The Covid omicron variant is less likely to result in hospitalization than earlier strains & appears to be milder in comparison, according to early data released this week. Data from South Africa, England & Scotland indicate that people infected with omicron are significantly less likely to be admitted to a hospital than if they contract other strains & the latter study further emphasized the importance of getting a booster shot. On Tues, a new study from South Africa showed that people infected with omicron are 80% less likely to be admitted to a hospital when compared with other strains. The authors of the study, which has not been peer-reviewed, cautioned that this may be in part due to higher immunity among the population, either as a result of previous infection and/or vaccination. The research, published by the country’s National Institute for Communicable Diseases, suggests a reduced risk of hospitalization & severe disease in omicron sufferers when compared with people who caught the delta variant. In the 2 months thru Nov, the data shows that individuals with omicron were 70% less likely to experience severe disease than earlier delta infections. However, among those hospitalized, the risk of severe disease didn't differ from other variants. The authors of the South Africa paper controlled for factors known to be associated with more severe infections, including age & comorbidities, & adjusted for factors including vaccination status. Scientists stress that it is still too early to definitively say whether omicron is milder & its higher transmissibility means there is still a risk that health-care systems could become overwhelmed because the high number of infections will likely lead to more people needing hospital care. However, the new data provides a ray of hope as govs try to asses the severity of the variant.
Three new studies suggest omicron has lower hospitalization risk and is milder than other variants
The US is heading into its 2nd Christmas & New Year's with Covid-19 cases on the rise again, but this time armed with readily available vaccines & booster shots. More than 62M Americans have received a booster, according to the Centers for Disease Control & Prevention (CDC), representing roughly 19% of all Americans & 30% of those who are fully vaccinated. About 55% of fully vaccinated seniors have received an additional dose. Since the heavily mutated & highly contagious Covid variant was first confirmed in the US on Dec 1, the nation has seen some of its biggest daily surges in vaccine shots in months. Much of the increase has been driven by boosters, which are being administered more than first & 2nd doses, combined, at an average of more than 800K per day over last week. “It’s got over 50 mutations, and because of those mutations just being vaccinated with two doses may not be enough,” CDC Director Dr Rochelle Walensky said. “And so we really do need people to get boosted in order to increase their protection, especially against severe disease and death with omicron.” Preliminary studies show the unvaccinated are getting hit the hardest & people with just 2 shots are seeing breakthrough infections, but 3 doses do offer protection against the omicron variant. Pfizer (PFE) & BioNTech (BNTX) announced earlier this month that while 2 doses of their vaccine may still offer protection against severe disease, protection is improved with a 3rd dose, according to an early laboratory study. US officials have stepped up their calls in recent weeks for booster shots in light of the vaccines' apparent reduced effectiveness against omicron. The variant, which accounted for a small fraction of cases in the US as of Dec 11, made up more than 73% of all cases as of Sat, according to the Centers for Disease Control & Prevention. The country is reporting nearly 150K daily Covid cases, based on a 7-day average of data compiled by Johns Hopkins University as of Dec 21, up 23% over the past week & 54% from before Thanksgiving.
U.S. heads into second Christmas with Covid amid rising cases and rush for shots
Gold futures climbed, to finish in positive territory for the day & week, ahead of the Christmas holiday, after several sessions highlighted by concerns that the spread of the omicron variant of the coronavirus may impact the economic outlook in the new year. Many global markets will be closed tomorrow. Futures for gold for Feb traded $9 (0.5%) higher to settle at $1811 an ounce, marking the highest settlement since Nov 19. Gold also eked out a positive finish for the week, up 0.4%, to log its 3rd straight weekly advance,. For the year, gold is looking at a 4.4% decline.
Gold ends at 5-week high, books weekly gain, in final session before Christmas break
Oil futures were slightly higher, ending a
holiday-shortened week with gains after the US benchmark finished the
previous session at a nearly one-month high. Encouraging data regarding the effectiveness of COVID-19 vaccine
boosters against the omicron variant of the coronavirus were helping to
underpin oil, analysts said, as well as studies indicating the strain
was relatively less severe than the delta variant, though more
infectious. West Texas
Intermediate crude for Feb rose 92¢ (1.3%)
to $73.68 a barrel after posting
the highest close yesterday since Nov 24. Feb Brent crude, the
global benchmark, was up $1.11 (1.5%) at $76.40 a barrel on ICE. Crude found support the previous session after a larger-than-expected drawdown in US crude inventories.
Oil logs 4% weekly rise as omicron jitters fade
The Dow was up 600 in the shortened week & rallied about 1500 in Dec so far. Have an enjoyable holiday weekend.
Dow Jones Industrials
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