Dow shot up 397, advancers over decliners about 3-1 & NAZ rose 149. The MLP index advanced 4+ to the 227s & the REIT index gained 2+ to the 285s. Junk bond funds continued in demand & Treasuries saw more buying which lowered yields. Oil added 1+ to the 81s & gold was up 1 to 1738 (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)
More than 253K coronavirus cases have been found in China in the past 3 weeks & the daily average is rising, the gov said, adding to pressure on officials who are trying to reduce economic damage by easing controls that confine Ms of people to their homes. The ruling Communist Party promised earlier this month to reduce disruptions from its "zero- COVID" strategy by making controls more flexible. But the latest wave of outbreaks is challenging that, prompting major cities including Beijing to close off populous districts, shut stores & offices & ordered factories to isolate their workforces from outside contact. That has fueled fears a downturn in Chinese business activity might hurt already weak global trade. The past week's average of 22K daily cases is double the previous week's rate, the official China News Service (CNS) reported. "Some provinces are facing the most severe and complex situation in the past three years," a bureau spokesman, Hu Xiang, said at a news conference. China's infection numbers are lower than those of the US & other major countries. But the ruling party is sticking to "zero COVID," which calls for isolating every case, while other govs are relaxing travel & other controls & trying to live with the virus. Today the gov reported 28K cases found over the past 24 hours, including 26K with no symptoms. 9022, were in Guangdong province, the heartland of export-oriented manufacturing adjacent to Hong Kong.
China anti-virus curbs spur fears of global economic impact
UK growth has lagged the world's biggest economies since the Covid-19 pandemic & is substantially below the OECD average, according to a new report from the influential Paris-based group. UK GDP has contracted by 0.4% between Q4-2019 & Q3-2022, versus cumulative 3.7% growth in the 38-member Organisation for Economic Co-operation & Development (OECD). In the G-7 nations — which includes Canada, France, Germany, Italy, Japan, the US & U.K. — GDP has grown by a cumulative 2.5%, with only the UK recording a decline. “We think this is happening mostly because of investment and because of consumption,” Alvaro Pereira, the OECD's chief economist, said. “Knowing the U.K. faces a difficult fiscal situation, that’s why we welcome what the government has done in the latest statement,” he added. Last week, Finance Minister Jeremy Hunt announced around £30B in spending cuts & £25 billion in tax hikes for workers & businesses in what he said was a bid to rebuild public finances, limit 41-year-high inflation & restore economic credibility after the market-rocking Sep budget. “We think that it is very important to maintain fiscal prudence at the same time that you’re able to boost or try to introduce some kinds of reforms to address some of the issues that have been plaguing the United Kingdom for a while, which is very low productivity,” Pereira continued. Pereira added that the OECD's forecast for the UK economy's magnitude of growth between 2022 & 2024 was similar to the independent Office for Budget Responsibility (OBR), but it expected a shallower 0.4% recession next year followed but 0.2% growth the year after, while the UK's OBR forecasts a deeper recession & a stronger rebound.
UK economy is lagging substantially behind other developed nations: OECD
After a 4th US railroad union rejected an agreement with their employers brokered by the Biden administratio- & reignited fears of a nationwide rail worker strike - one spokesman for the rail companies claimed they’re "ready, willing and able" to reach new negotiations. "We need to keep the network moving. We need to keep the economy moving," Association of American Railroads (AAR) Pres & CEO Ian Jeffries said. "And so that's why we stand ready, willing and able to reach new voluntary agreements. And absent that, we believe Congress might need to be ready to step in as it historically has." Jeffries’ comments come just after a 4th rail union rejected a tentative agreement with the nation's major freight railroads, raising the prospects of a nationwide strike that could kneecap the economy in the middle of the holiday season. Members of the Transportation Division of the Intl Association of Sheet Metal, Air, Rail & Transportation Workers (SMART-TD), representing more than 28K workers, issued a split decision in the vote count announced yesterday. Yardmasters represented by SMART-TD voted to ratify their contract, but a smaller group of some 1300 train & engine service members voted against their separate contract. All 12 unions involved in negotiations must ratify their new agreements to avert a potential work stoppage, which would decimate already fragile supply chains in the middle of the Christmas shopping rush. While 8 have already agreed to the deal negotiated by the Presidential Emergency Board (PEB) appointed by Pres, a strike could happen as early as Dec 9. In Oct, the AAR had estimated that the strikes' disruption to the supply chain would cost the US economy $2B per day.
Experts warn looming rail strike would devastate economy
Gold futures closed nearly flat, finding support as a sharp
bounce by the $ ran out of steam, while investors awaited more
cues on the Federal Reserve's monetary policy path. Gold for Dec gave back chump change to settle
at $1739 an ounce. Gold slid yesterday as the $ bounced sharply higher. The ICE US Dollar Index, a measure of
the currency against a basket of major rivals, was off 0.6% to
107.20 after jumping nearly 1% on yesterday.
Gold settles nearly flat to snap 4-session losing run as dollar bounce fizzles
Oil prices rose about 1% or the biggest leap in 2 weeks, as
traders responded to hints that producer alliance OPEC+ could announce
another production cut at its Dec meeting to deepen the
2M-barrel reduction put in place this month. Expectations that US crude inventories would have fallen last week for
a 2nd week in a row also boosted sentiment in oil.
WTI for Jan settled up 91¢ (1.1%) at $80.95 per
barrel. The US crude benchmark hit a 10-month low beneath $76 yesterday.
Oil recovers, closes with gain as market shakes off OPEC production rumblings
Chinese Covid problems & a possible railroad strike in the US are not keeping stock buyers away. Of course holiday trading has low volumes, so it's not all that meaningful.
Dow Jones Industrials
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