Dow climbed 273 thanks to late day buying, advancers over decliners 2-1 & NAZ went up 106. The MLP index rose 5+ to the 202s & the REIT index was off 1+ to the 468s. Junk bond funds were mixed & Treasuries continued weak. Oil was little changed in the low 88s & gold went up 3 to 1800 (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 daily death toll from Covid rose to an average of more than 2400 fatalities over the previous seven days as of yesterday, up 39% over the past 2 weeks & the highest level in about a year, according to Johns Hopkins University. Jennifer Nuzzo, head of epidemiology at Johns Hopkins Covid Resource Center, said Covid deaths may rise even more because states with lower vaccination rates got hit later by omicron & haven't experienced the full brunt of the variant yet. She said it’s a tragedy that people are still dying when vaccines are available that protect against severe illness. “Any time we have deaths after the development of a vaccine — that largely takes off the table the possibility of death — is a tragedy,” Nuzzo added. “There’s no way around that this is a bad development for the pandemic.” Vaccines weren’t widely available the last time Covid deaths were this high in America. Pfizer (PFE) & Moderna's (MRNA) shots didn't get emergency approval until Dec 2020, followed by Johnson & Johnson's (JNJ) about 3 months later. Just 28 M Covid shots had been administered by this time last year with 4.7M people getting a 2nd dose. Almost 250M Americans have received at least one shot & more than 88M of them have received both primary doses & been boosted. As infections have soared lately, the vaccines have at least prevented serious illness & death from surging at the same rate; still, with ¼ of Americans yet to get a single shot, many remain susceptible. Reported Covid deaths generally lag rises in cases. States that have not yet peaked in infections will likely do so within the next 2 weeks, with peak deaths following about 2 weeks later, said Dr Scott Braithwaite, professor of population health & medicine for NYU Langone Health. Some parts of the country are seeing encouraging signs & cases & hospitalizations are easing nationwide. Hopkins data shows that US cases surged to a pandemic high of close to 1M new infections a day in mid-Jan. The country is now reporting a 7-day average of about 450K new cases per day, down 36% over the past 2 weeks. The roughly 140K patients currently in US hospitals with Covid is also down from the recent peak of 159K on Jan 20, according to a 7-day average of Dept of Health & Human Services data.
U.S. Covid fatalities reach highest level in a year as omicron cases ease
Ukraine's ambassador to the UN said that Kyiv still hopes for a diplomatic resolution with Russia even as Moscow sends more troops & weapons to its border. “If Russia has any questions to Ukraine, it is better to meet and talk, not to bring troops to the Ukrainian borders and intimidate Ukrainian people,” said Ukrainian Ambassador Sergiy Kyslytsya at a United Nations Security Council meeting. The Ukrainian diplomat is not a member of the council but was invited to participate as the crisis escalates at his country's border. He pushed back on Russian claims that Kyiv was prepared to mount an attack. “Ukraine is not going to launch a military offensive, neither in Donbass, nor Crimea nor anywhere else,” Kyslytsya said. “The Kremlin must remember that Ukraine is ready to defend itself. At the same time we support the need to keep diplomatic channels with Russia open,” he added. His remarks come as an estimated 100K troops equipped with advanced weaponry line Ukraine's eastern border with Russia & northern border with Belarus, a Moscow ally. “It is in the interest of everyone to prevent the war or rather to prevent the renewal of an active phase of the military ongoing aggression,” Kyslytsya continued. “Everyone will suffer, even if you are far away from Ukraine,” he said, referencing possible global economic repercussions from war. The ambassadors from the US & Russia clashed at the intl forum, which did not yield any action or a joint statement from participants.
Ukraine calls for peaceful solution to Russian military buildup at U.N. meeting
United Parcel Service (UPS) posted record quarterly earnings & forecast 2022 revenue
above expectations, driven by higher shipping rates & e-commerce
demand. Demand
for express shipping has risen sharply during the Covid-19 pandemic,
especially in business-to-consumer package deliveries, as the temporary
closure of many traditional stores drove more shoppers online. US
retailers reported a better-than-expected $887B in sales
during the crucial holiday season, a 14.1% rise from a year earlier. UPS
reported an 11.5% jump in revenue to $27.8B in the 3 months
to Dec 31, with the average revenue per piece increasing by 11.3%. The
company also forecast revenue of about $102B in 2022, beating an estimate of $100B. It also expects
adjusted operating margins of 13.7% in 2022, above 2021 levels, despite
rising labor & fuel costs roiling the industry. The company also hiked its quarterly div by 49% to $1.52 per
share. Adjusted EPS was $3.59 in Q4, beating estimates of $3.10. The stock jumped 28.34 (14%).
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UPS delivers rosy outlook for 2022 after record earnings, shares soar
US oil futures settled slightly higher,
as traders await the outcome of tomorrow's meeting of major oil
producers. OPEC+ is expected to agree to a 400K
barrel-per-day production increase for Mar. When factoring in that
many members are struggling to hit their quotas, oil seems poised to
head higher. Fears
of disruption to supplies will remain elevated given the winter blast
hitting the north & the geopolitical risks abroad. West
Texas Intermediate crude for Mar edged up by a nickel to settle at $88.20 a barrel.
U.S. oil futures settle modestly higher a day ahead of the OPEC+ meeting
Gold futures were higher for a 2nd session in a row, climbing above the significant $1800 an ounce level to start the month, as weakness in the $ helped foster some buying in bullion. Yesterday, San Francisco Fed Pres Mary Daly said the central bank is not behind the curve & that upcoming rate hikes would be “gradual and not disruptive.” Philadelphia Fed Pres Patrick Harker today said it would take another burst of inflation to justify an aggressive interest rate increase when the Fed starts to raise rates next month. The threat of a 50 basis-point interest rate hike in Mar was downplayed by multiple Fed speakers. Apr gold settled $6 higher to settle at $1802 an ounce, following a 0.6% gain a day ago, which helped to reduce a monthly decline to 1.8%, the biggest monthly fall since Sep. Gold prices continued to trade higher after data today after the ISM manufacturing index fell to 57.6% in Jan from 58.8%.
Gold futures settle back above $1,800 for first time in nearly a week
St Louis Federal Reserve Bank Pres James Bullard said he sees the unemployment rate falling below 3% this year, a jobless rate the US economy last seen in the early 1950s. "I think unemployment is going to go down below 3% this year," Bullard said today. The unemployment rate could continue to drop this year from its current level of 3.9% as companies scrounge for workers & several factors, including early retirements, limit the size of the labor force, he added." "I think the upcoming jobs report will probably be not very good because of Omicron, but don't be fooled," Bullard continued. "This is quite the strong economy here and a very strong labor market."
Fed's Bullard: Unemployment rate can go below 3%
Trading was unexciting until the last hour when buyers returned to drive the Dow up 200. Bullard's comments about the unemployment rate falling below 3% got a lot of attention by traders. Demand for safe haven gold is good & oil is near 14 yar highs.
Dow Jones Industrials
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