Dow tumbled 449, decliners over advancers better than 3-1 & NAZ sank 385. The MLP index dropped 3+ to the 191z & the REIT index was flattish in the 465s. Junk bond funds were weak & Treasuries saw heavy buying, reducing the short term spike in yields. Oil was off about 1 to the 84s & gold declined 11 to 1831 (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)
A 35-year-old man returned to the US from Wuhan, China on Jan 15, 2020 & fell ill with a cough & fever. He had read an alert from the Centers for Disease Control & Prevention (CDC) about an outbreak of a novel coronavirus in Wuhan & sought treatment at an urgent care clinic in Snohomish County, Washington 4 days later. On Jan 21, the CDC publicly confirmed he had the first known case of coronavirus in the US, although the agency would later find the virus had arrived on the West Coast as early as Dec after testing blood samples for antibodies. After confirming the Washington state case, the CDC told the public it believed the risk “remains low at this time.” There was growing evidence of person-to-person transmission of the virus, the CDC said, but “it’s unclear how easily this virus is spreading between people.” Then Pres Trump told CNBC the US had it “totally under control.” In late Feb, a senior CDC official, Dr Nancy Messonnier, warned that containing the virus at the nation's borders was no longer feasible. Community spread would happen in the US, she said, & the central was question was “how many people in this country will have severe illness.” In the 2 years since that first confirmed case, the virus has torn through the US with a ferocity & duration few anticipated. The human toll is staggering, with more than 860K people dead & more than 69M total infections. Hospitals around the nation have been pushed to the breaking point with more than 4M admissions of confirmed Covid patients since Aug 2020, when the CDC started tracking hospitalizations. The hospital admissions are an undercount because they do not include the wave of cases that first hit the US in the spring 2020 when hospitals were caught flat footed & testing was inadequate. Though the US now has effective vaccines & therapeutics, the future course of the pandemic remains uncertain as the virus mutates into new variants that are more transmissible & can evade vaccine protection. The highly contagious omicron variant has pushed infections & hospitalizations to record highs across the globe this month. The rapid evolution of the virus and the dramatic waves of infection that would follow, from alpha to delta & omicron, came as a surprise to many elected leaders, public health officials & scientists. Dr Michael Osterholm, a top epidemiologist, said the Covid mutations are the big unknown that will determine the future course of the pandemic. More than a year after the first vaccine was administered in the US, 67% of Americans older than 5 are fully vaccinated. Tens of Ms of Americans still have not gotten their shots, despite the fact that data has proven them to be safe & effective at preventing severe illness & death. Currently, the US is reporting an average of more than 736K new infections per day. While that is still far higher than previous waves, average daily infections are down 8% from the previous week. The US is reporting more than 1800 deaths per day as a 7-day average. The head of the World Health Organization, Dr Tedros Adhanom Ghebreyesus, cautioned earlier this week that the pandemic is “nowhere near over,” warning that new variants are likely to emerge as omicron rapidly spread across the world.
Two years since Covid was confirmed in U.S., the pandemic is worse than imagined
Some House Dems have threatened to block Build Back Better
legislation if the broken-up package drops relief for the $10K limit
on the federal deduction for state & local taxes, known as SALT. The $1.75T social & climate spending plan hit a roadblock in Dec
when moderate Sen Joe Manchin said he wouldn't vote for it. The bill needs support from every Dem Senator as part of the
budget reconciliation process. However, break up the legislation and try to pass parts of the bill, expressing optimism for climate policy & early childhood education. “I’m
confident we can get pieces, big chunks of the Build Back Better law
signed into law,” he said this week. But his agenda may face another hurdle if the legislation
doesn't include changes to the $10K SALT cap, a key issue for some
lawmakers in high-tax states, such as California, New Jersey & New
York. The issue has been a pain point since enacted as part of former pres Trump's
2017 tax overhaul because filers who itemize deductions on their
federal return can't write off more than $10K of state & local
taxes. Without support from Senate Reps, SALT relief is unlikely to make it thru Congress as a standalone bill. “SALT
remains a top priority,” said Reps Tom Suozzi; Josh
Gottheimer & Mikie Sherrill.
‘No SALT, no deal.’ Some House Democrats say deduction must be in Biden agenda
A booster dose of the Covid-19 vaccine significantly reduces a person's odds of hospitalization from the omicron variant, new research released by the Centers for Disease Control & Prevention finds. The 3 new studies from the agency are among the first to look at the vaccines' impact against omicron in the US, which now accounts for more than 99% of new cases in the country. The research underscores the importance of booster shots to protect against severe illness from the rapidly spreading variant, which has overwhelmed hospitals. “You don’t want to be that one person that has a bad outcome, that requires hospitalization, when there’s no hospital bed for you,” said Syra Madad, an infectious disease epidemiologist at the Harvard Belfer Center for Science & Intl Affairs. The new studies find that a booster shot can provide significant protection against needing emergency medical care or hospitalization because of Covid-19. The data included adults who'd received either the Pfizer (PFE) or Moderna (MRNA) vaccines. The study authors were able to tease out the effects of the boosters during both the delta & omicron waves of Covid.
Booster shots effective against severe illness from omicron
Gold futures ended lower, falling further away from 2-month highs hit earlier this week, but prices still registered a 2nd week in a row of gains. Feb gold fell $10 (0.6%) to settle at $1831 an ounce, after losing less than $1 yesterday. Still, the precious metal saw a weekly advance of 0.8%, after a rise of 1.1% the week before. Gold had settled Wed at its highest in 2 months. Gold has enjoyed haven demand amid a global selloff in equities & increased anxieties about the market outlook set against rising inflation & a Federal Reserve that has expressed its intent on pulling back on easy-money policies. That uncertain backdrop has benefited gold in the near-term but the prospect of higher rates & Treasury yields eventually rising, will likely pose a headwind for gold. The rate-setting FOMC next gathers on Jan 25-26 & is expected to set the stage for a series of interest-rate increases.
Gold prices end lower, but clinch 2nd straight weekly gain
Oil futures finish lower, down a second session in a row from the more than 7-year highs set earlier in the week. The decline follows a rise in US crude inventories & a selloff in stocks that has weighed on overall sentiment. WTI crude for Mar fell 41¢ (0.5%) to settle at $85.14 a barrel, trimming the U.S. benchmark's weekly advance to 2.2%. Mar Brent crude, the global benchmark, lost 49¢ (0.6%) at $87.89 a barrel, for a 2.1% weekly gain. Both WTI & Brent closed Wed at their highest since 2014 & marked a 5th consecutive weekly gain. Today’s decline followed minor losses yesterday, the day the Energy Information Administration (EIA) reported that US crude inventories, excluding the SPR, unexpectedly climbed by 500K barrels for last week.
Oil prices finish lower, but tally fa 5th straight weekly gain
The Dow dropped about 1500 this week & a big 2000 YTD. NAZ was down 1100 this week & 1900 YTD. With the FOMC meeting dominating the news next week, it looks like the bears will have the upper hand then.
Dow Jones Industrials
No comments:
Post a Comment