Dow dropped 938 finishing at session lows with heavy selling in the PM, decliners over advancers better than 4-1 & NAZ retreated 536. The MLP index was off 5+ to the 206s & the REIT index plunged a whopping 23 to the 461s. Junk bond funds fluctuated & Treasuries ran into a little selling, although the yield on the 10 Year Treasury remains near 2.9%. Oil erased early gains to end lower & snap a 3-day winning streak, sliding back 1+ to the 104s, & gold jumped 20 to 1911 ( 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)
Intel (INTC), a Dow stock, CEO Pat Gelsinger said he now expects the semiconductor industry to suffer supply shortages until 2024. In an interview Gelsinger said the global chip crunch may drag on due to constrained availability of key manufacturing tools, serving as an obstacle to expanding capacity levels required to meet elevated demand. “That’s part of the reason that we believe the overall semiconductor shortage will now drift into 2024, from our earlier estimates in 2023, just because the shortages have now hit equipment and some of those factory ramps will be more challenged,” Gelsinger added. The CEO's comments come one day after the chipmaker offered a fiscal 2nd-qtr forecast that was lighter than expected. Its fiscal Q1 earnings & revenue topped expectations, however. its shares were down. The need for more semiconductors has been growing for years, as the world becomes more digital & processing chips go into everything from smartphones to automobiles to washing machines. The Covid pandemic caused an acute shortage, though, as factories were disrupted at the same time demand for consumer electronics took off. The shortage has had significant economic consequences & has contributed to the US economy experiencing its hottest inflation since the early 1980s.
Intel CEO now expects chip shortage to last into 2024
Denmark has become the first country to halt its Covid vaccination program, saying it is doing so because the virus is now under control. “Spring has arrived, vaccine coverage in the Danish population is high, and the epidemic has reversed,” the Danish Health Authority said. “Therefore, the National Board of Health is now ending the broad vaccination efforts against Covid-19 for this season,” it said. People will not be invited for vaccines from May 15, it said, although everyone will be able to finish their course of vaccination. Denmark's Covid vaccination campaign began soon after Christmas in 2020. Some 4.8M citizens have been vaccinated with more than 3.6M people receiving a booster shot. At the same time, many people have been infected since the omicron variant became the dominant strain of the virus, meaning immunity levels among the population are high. “We are in a good place,” Bolette Soborg, unit manager at the National Board of Health, commented. “We have good control of the epidemic, which seems to be subsiding. Admission rates [to hospitals] are stable and we also expect them to fall soon. Therefore, we are rounding up the mass vaccination program against Covid-19.” Soborg insisted that the public can still be vaccinated over the spring & summer if they want, & that vaccination sites will remain open around the country. He added that immunization was still recommended to people for whom Covid poses a heightened risk, such as those over the age of 40 & for unvaccinated pregnant women. “We also continue to recommend that you complete your started vaccination course,” he added. Denmark's move to suspend its vaccination program comes as the Covid situation around the world remains mixed. Europe & the US have abandoned most Covid restrictions, but China is still imposing (or considering) lockdowns as the virus spreads in major cities like Shanghai & Beijing. Far from scrapping its vaccination program altogether, however, the Danish Health & Medicines Authority said there will probably be a need to vaccinate against Covid-19 again in the fall as the virus continues to mutate.
Denmark becomes the first country to halt its Covid vaccination program
Treasury Secretary Janet Yellen defended Pres Biden's nearly $2T COVID-19 stimulus bill despite criticism that the burst of gov spending helped accelerate the highest inflation in 40 years. Yellen has helped the White House sell the $1.9T American Rescue Plan, which pumped money directly to households, businesses & local govs to keep them afloat during the COVID-19 pandemic as the gov ramped up vaccine distribution. "These responses played major roles in igniting a robust recovery," Yellen said. "Notably, the American Rescue Plan played a central role in driving strong growth throughout 2021, with the United States real GDP growth outpacing other advanced economies and our labor market recovering faster relative to historical experience." Her comments come as Americans wrestle with the hottest inflation since 1981, which has quickly eroded consumers' purchasing power & sent Pres Biden's approval rating tumbling. The White House has identified the Russian war in Ukraine, supply chain bottlenecks & other pandemic-induced disruptions in the economy for the recent price spikes, while GOP lawmakers have pinned it on the pres's massive spending agenda. But the rising price of everyday goods is eating into worker pay, slowing the US economic recovery & forcing the Federal Reserve to aggressively tighten monetary policy. Yellen argued that the alternative to huge gov spending was an economic downturn that "could match the Great Depression." "Given this uncertainty, the recovery packages sought to protect against tail risk," she added. "They were not just tailored to address the median outcome."
Yellen defends Biden's massive stimulus bill, despite sky-high inflation
Gold futures closed higher, finding support as a surge by the $ relented, but it still booked its worst monthly performance since last Sep. Gold for Jun rose $20 (1.1%) to settle at $1911 an ounce, handing the yellow metal a 1.2% weekly fall & a 2.1% monthly decline, after briefly topping the $2000 level on Apr 18. The precious metal’s monthly tumble marked its worst in 7 months & its biggest Apr drop since 2013, when gold futures shed 7.8%. It also helped that the ICE US Dollar Index a measure of the currency against a basket of 6 major rivals, was down 0.7% today, a day after hitting a 5-year high. Even so, the index remains up 4.7% in Apr. Economic data was also in focus, with the personal consumption price index, the Federal Reserve's preferred measure of inflation, advancing 0.9% in Mar to an annual 6.6% rate. The increase stemmed largely from a surge in the cost of gas, with some signs that intense price pressures could begin to ease. Today also marked the last trading day in a brutal Apr for stocks & other corners of financial markets.
Gold ends Friday higher, but books worst month since Sept. 2021 on strong dollar
Oil prices snap 3-day winning streak but book April rise; diesel prices soar
Dow dropped over 800 this week & about a massive 3350 for the month. Out of control with no end in sight summarizes what worries investors. Note: the Dow Jones Equity REIT Index (INDEX) plunged on fears of what higher interest rates will mean for REITs.
Dow Jones Industrials
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