Dow jumped 371 (near session highs), advancers over decliners 3-2 & NAZ climbed 178. The MLP index fell 1+ to the 203s & the REIT index was off 2+ to 460. Junk bond funds crawled higher & Treasuries saw more selling bringing the yield on the 10 year Treasury up 4 basis points to 1.95%. Oil dropped 2+ to the 89s & gold gained 6 to 1828 (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)
The only Johnson & Johnson (JNJ), a Dow stock & Dividend Aristocrat, facility currently making usable batches of the company's single-shot
coronavirus vaccine has temporarily halted its production. The
Netherlands-based plant has instead focused on making a different,
possibly more profitable vaccine aimed at a different virus. The
pause in production at the Leiden facility, which began late last year,
could reduce the supply of JNJ's Covid vaccine by hundreds of Ms of doses. It is
unclear whether vaccine supplies have been been affected by the
company's move, according to the report. JNJ is preparing to have
the Leiden plant restart Covid vaccine production in Mar. JNJ spokesman Jake Sargent didn't directly comment. He said the company is
“focused on ensuring our vaccine is available where people are in need,” & that it is fulfilling its obligations to the intl groups
trying to boost access to the Covid vaccine. JNJ is continuing
to deliver batches of the vaccine materials to sites that bottle &
package doses, & “we currently have millions of doses of our Covid-19
vaccine in inventory,” Sargent added. “We are proud of the work of
our many industry partners and the collaborations we have developed to
produce our Covid-19 vaccine,” he said. The stock rose 44¢.
If you would like to learn more about JNJ click on this link:
club.ino.com/trend/analysis/stock/JNJ_aid=CD3289&a_bid=6ae5b6f
Johnson & Johnson plant pauses Covid vaccine production, report says
United States Steel (X) CEO David Burritt explained during an interview why he is pleased with the deal with Japan to cut tariffs on the commodity. The report was made at the site where the company was holding a
groundbreaking ceremony for a new $3B mill in Arkansas, noting that Burritt is glad to learn that the deal will include
a quota. The day before, US gov officials said they reached an agreement to essentially lift the 25% tariff that former Pres Trump imposed on imported Japanese steel. The
deal with Japan would not include the first 1.25M metric tons of
imported steel from the tax. That number is equal to the average that
Americans imported from the country in 2018 & 2019, effectively doing
away with the tariffs while also allowing for taxes to be charged on any
imports over that amount. Commerce Secretary Gina Raimondo argued that the deal
"will strengthen America’s steel industry & ensure its workforce stays
competitive, while also providing more access to cheaper steel &
addressing a major irritant between the US & Japan, one of
our most important allies. Burritt said that the deal is not
only credited to the Biden administration, but also Pres Trump's
administration given Trump had put the tariffs in place to begin with & forced the deal to be negotiated with the EU & then
with Japan. The stock went up 1.02 .
If you would like to learn more about US Steel click on this link:
club.ino.com/trend/analysis/stock/X_aid=CD3289&a_bid=6ae5b6f
US, Japan reach deal to scrap tariffs on imported steel
Total US consumer debt at the end of the year came to $15.6T, a year-over-year jump of $333B during Q4 & just over $1T for the full year, according to the Federal Reserve's New York district. The quarterly rise was the biggest since 2007 & the annual gain was the largest ever in records going back to 2003. The news comes ahead of a period in which the Fed is expected to start jacking up interest rates as it looks to tamp down inflation, which is running at its fastest pace in nearly 40 years. Markets expect the central bank to start increasing rates in Mar, the first of at least 5 bump-ups this year, totaling 1.25 percentage points. Fed interest moves are directly tied to the prime rate that consumers pay for many forms of debt, including credit cards & adjustable-rate mortgages. A large chunk of the debt-load increase came from mortgages, which saw balances rise by $890B for the year & $258B in Q4, to nearly $11T. Mortgage originations for the year totaled more than $4.5T, a new record. Credit card balances increased by $52B in the final 3 months of the year, a new quarterly record that brought total debt in that category to $860B. Owing to the rapid gain in prices, auto-loan balances rose by $90B (6.6%) to $1.46T. New auto prices rose 11.8% for the year while prices for used vehicles soared by 37.3%, according to Labor Dept data. One area that saw little increase was student loans, which edged higher by just $20B for the year & actually declined marginally in Q4. Forbearance programs, though mostly expired, are still keeping balances & delinquencies in check. New York Fed researchers said the rising-rate environment could affect household cash flows as borrowers adjust. Those who locked in at low mortgage rates, for instance, are likely to be reluctant to go out & buy new homes with rates moving higher, while those who ran up credit card balances could be constrained as financing costs increase.
Consumer debt totals $15.6 trillion in 2021, a record-breaking increase
Gold futures climbed, shaking off pressure from strength in the $ & Treasury yields, to stretch their gains into a 3rd-consecutive session & mark their highest finish in almost 3 weeks. Apr gold climbed by $6 to settle at $1827 an ounce — the highest most-active contract settlement since Jan 26. Prices rose 0.8% yesterday to mark the precious metal's biggest one-day percentage gain since Jan 19. Prices for the metal touched highs above $1825 after data released today showed that the US trade deficit jumped 27% in 2021 to a record $859B. The deficit widened in Dec by 1.8% to $80.7B — the 2nd largest monthly increase ever. Before the trade deficit data, gold had been trading mostly lower as yields for gov debt rose & the $ strengthened. The yield on the 10-year Treasury note was up at 1.96%, to around highs not seen since 2020 & the $ was up 0.2%, as gauged by the ICE US Dollar Index a measure of greenback against a ½-dozen rival currencies. Higher yields and a stronger $ can undermine interest in $-pegged bullion, which doesn’t offer a coupon.
Gold futures score a third-straight session gain
Oil futures moved lower, continuing a pullback from levels last seen in 2014 as traders monitored talks aimed at returning Iran to an intl nuclear accord & allowing the country to resume crude exports. West Texas Intermediate crude for Mar fell $1.92 (2.1%) to $89.40 a barrel, after the US benchmark yesterday snapped a 6-day win streak that had taken it to levels last seen in Sep 2014. Apr Brent crude the global benchmark, fell $1.93 (2.1%) to $90.76 a barrel. The global benchmark broke a 3-day winning streak yesterday, after ending last week at its highest since Oct 2014. Negotiations aimed at reviving the 2015 nuclear deal resumed in Vienna yesterday. The US, an indirect participant in the talks, exited the deal in 2018 under Pres Trump, renewing sanctions on Iran that prevent it from large-scale exports of crude. Iran responded by increasing the amount & purity of the uranium it enriches, a violation of the accord. The Biden administration on Fri waived sanctions on some of Iran's civilian nuclear activities in a move observers took as a sign of progress toward an agreement. Worries remain, however, over the threat of a Russian invasion of Ukraine. French Pres Emmanuel Macron arrived in Kyiv today after talks with Russian Pres Vladimir Putin in Moscow yesterday. Russia has massed around 100K troops on the border with Ukraine. Moscow has insisted it has no plans to invade, but has demanded concessions on security arrangements from Western powers & NATO. Analysts forecast that the Energy Information Administration will report tomorrow a 100K-barrel rise in US crude supplies last week.
Oil settles at lowest price in nearly a week as traders watch Iran talks, Ukraine
Buyers bid stock prices higher pretty much all day. Meanwhile gold is getting interest from negative thinking investors & higher Treasury rates will start bleeding thru to consumers & businesses. That's not good for the recovery. The Dow is still where it was 6 months ago (see below).Dow Jones Industrials
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