Dow surged 825 (session highs), advancers over decliners better than 5-1 & NAZ jumped 375. The MLP index recovered 5+ to the 189s & the REIT index gained 8+ to the 415s. Junk bond funds continued in demand & Treasuries saw more selling. Oil was up 3+ to the 107s & gold was steady at 1829 (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)
U.K. Covid-19 cases are on the rise again, according to new data, which points to an increase in infections following the Queen's Platinum Jubilee celebrations. A total of 1.7M people tested positive for the virus in the week to Jun 18, estimates from the UK's Office for National Statistics showed. That figure is up 75% from 2 weeks prior, before Brits celebrated the Queen's 70th anniversary on the throne with a long weekend of street parties & social gatherings. The uptick comes as the UK's Health Security Agency (UKHSA) said that the latest technical data suggests 2 new Omicron variants — BA.4 & BA.5 — have become dominant in the UK & are driving recent increase in infections. The 2 variants now make up more than ½ of new Covid cases in England, accounting for approximately 22% & 39% of cases, respectively. “It is clear that the increasing prevalence of Omicron BA.4 and BA.5 are significantly increasing the case numbers we have observed in recent weeks,” the UKHSA's chief medical advisor said. UKHSA's latest analysis suggests BA.5 is growing 35.1% faster than the previously dominant BA.2, while BA.4 is growing around 19.1% faster. That suggests that BA.5 is likely to soon become the dominant Covid variant in the UK. Both variants were designated “variants of concern” in May, though scientists said there is currently no evidence to suggest either causes more serious illness than previous strains.
UK Covid cases surge following Jubilee celebrations, new variants become dominant
Ukrainian forces may soon give up the key battleground of Severodonetsk in the east, where their troops have suffered heavy losses & the Russian offensive has gained significant ground. EU leaders have approved Ukraine’s candidacy as to join the bloc, marking a milestone in its long journey to join the union. Russian & Ukrainian forces remain nailed down in street battles in many cities, towns & villages in the eastern Luhansk region as Russian artillery fire destroys swathes of infrastructure & homes in the broader Donbas. Ukraine's top general told his US counterpart during a phone call that Ukraine needed “fire parity” with Russia in order to “stabilize” the difficult situation in the country's eastern Luhansk region. “We discussed the operational situation and the delivery flow of international technical assistance,” Ukraine’s General Valeriy Zaluzhniy said after a phone call with US Chair of the Joint Chiefs of Staff, General Mark Milley. Ukraine has said Russia's artillery advantage on the Donbas frontlines is taking a significant toll on Ukrainian troops & has called on its Western partners to supply more weapons to minimize the deficit. Russia is trying but has been unable to target Western weapons flowing into Ukraine, including longer-range systems that Kyiv hopes will be decisive on the battlefield, a senior US defense official said. The official also appeared to play down the significance of Russian advances in Ukraine & said a Ukrainian pullback from Sievierodonetsk would allow them to take a better defensive position. “In moving the Ukrainian armed forces from Sievierodonetsk back, what they are doing is putting themselves in a position where they can better defend themselves,” the official added.
Ukrainian forces will have to leave key eastern city; retired Russian major captured
There’s a silver lining to higher interest rates: Stashing some cash finally pays. Soaring inflation, which pushed the Federal Reserve into hiking its benchmark rate, is having an effect on the return savers stand to get on their money, at long last. While
the Fed has no direct influence on deposit rates, they tend to be
correlated to changes in the target federal funds rate. As a result, the savings account rates at some of the largest retail banks have been barely above rock bottom since the Covid pandemic crisis began — currently a mere 0.08%, on average. With interest rates now on the rise, “things are starting to accelerate,” said Ken Tumin, founder of DepositAccounts.com. Last month, the average online savings account rate notched its largest monthly gain since 2017. Online-only
banks offer higher
returns, thanks in part to lower overhead expenses than traditional
banks.
The interest rates on savings accounts rise in wake of Fed
Gold prices edged up for the session, but end lower for a 2nd straight week. Aug gold was even to settle even at $1829 per ounce. There's a sort of world war in the financial markets, with interest rates, inflation, the $ & Federal Reserve among the factions facing each other simultaneously. The $, meanwhile, is up big since last year. That pressures $-denominated prices of gold. And Fed Chair Jerome Powell is doing his best to combat this man-made inflation resulting from COVID but...when rates rise, gold can't be expected to flourish.
Gold prices down a second week
Crude futures finished sharply higher, as tight supplies help prices rebound from back-to-back session declines, but worries that economic slowdowns will hit demand pulled US prices lower for the week. West Texas Intermediate crude for Aug rose $3.35 (3.2%) to settle at $107.62 a barrel. For the week prices lost 0.3%. Front month Aug Brent crude the global benchmark, rose $3.07 (2.8%) to $113.12 a barrel, a day after settling at the lowest since May 18. The contract was unchanged from the week-ago close. Oil prices settled lower in the previous 2 trading sessions, with the commodity pressured by recession fears as central banks across the world tighten monetary policy in the face of soaring inflation. Oil tracked US equity futures higher today, with gains stemming from one emerging viewpoint that the Fed's rate hike ambitions will get curtailed by a recession. The Organization of the Petroleum Exporting Countries & their allies (OPEC+) are set to meet next week to review the market & decide on oil output levels.
Oil ends higher on tight supplies, but U.S. prices hold on to a weekly loss on recession worries
The bulls were in command all day on hopes that the Fed will solve economic problems. For the week, Dow shot up 1550. But it still is down almost 5K YTD.
Dow Jones Industrials
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