Wednesday, March 27, 2024

Markets rebounds while gold tops 2200 for a new record

Dow went up 234, advancers over decliners 3-1 & NAZ slid back 6.  The MLP index remained in the 281s & the REIT index gained 6+ to 381.  Junk bond funds edged higher & Treasuries saw more buying which trimmed yields (more below).  Oil traded lower in the 81s & gold jumped 15 to 2214 for another record.

AMJ (Alerian MLP Index tracking fund)

Moderna (MRNA) has more to offer beyond its Covid vaccine.  The biotech company announced positive clinical trial data on 3 experimental vaccines against other viruses.  The company is moving those shots to final stage studies.  The update brings MRNA a step closer to having multiple products on the market, which it badly needs amid plunging demand for Covid shots worldwide.  The company's Covid jab is its only commercially available product.  MRNA stock has long been tied to that vaccine, with shares falling nearly 45% last year.  MRNA will chart its post-Covid future during its 5th annual “Vaccines Day,” an investor event in Boston focused on the company's vaccine portfolio.  That business has an estimated total addressable market of $52B for infectious disease shots, which includes $27B for respiratory vaccines & more than $25B for latent shots & other jabs.  The company will present new clinical trial data on the 3 vaccines, including some against latent viruses, at the event today.  The stock rose 1.10.

Moderna moves three vaccines into final stage trials as it works to rebound from Covid slump

The usually busy spring housing market is underway, but mortgage demand isn't moving. Application volume was essentially flat last week, dropping 0.7% compared with the previous week, according to the Mortgage Bankers Association's (MBA) seasonally adjusted index.  The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($766K or less) decreased to 6.93% from 6.97%, with points decreasing to 0.60 from 0.64 (including the origination fee) for loans with a 20% down payment.  Applications to refinance a home loan fell 2% for the week & were 9% lower than the same week one year ago.  Mortgage rates today are still about a ½ a percentage point higher than they were at this time last year, so recent borrowers have no incentive to refinance.   Applications for a mortgage to purchase a home decreased 0.2% from the week before & were 16% lower year over year.  “Purchase applications were essentially unchanged, as homebuyers continue to hold out for lower mortgage rates and for more listings to hit the market,” said Joel Kan, an MBA economist.  “Lower rates should help to free up additional inventory as the lock-in effect is reduced, but we expect that will only take place gradually, as we forecast that rates will move toward 6-percent by the end of the year.”  Mortgage rates have basically moved sideways to start this week & are unlikely to change until next week, when more economic data is released.  “Rates are driven by bonds, and bonds are waiting on the most relevant economic data to offer a comment on the path of inflation and the economy in general,” wrote Matthew Graham, chief operating officer at Mortgage News Daily.  “If inflation falls a bit more or if the economy shows marked signs of weakening, it would tip the scales in favor of lower rates.”

Moderna moves three vaccines into final stage trials as it works to rebound from Covid slump

Treasury yields slipped as investors considered the economic outlook & looked to fresh data.  The yield on the 10-year Treasury fell more than 2 basis points to 4.21% & the yield on the 2-year Treasury was last at 4.57% after also declining more than 2 basis points.  Yields & prices move in opposite directions & 1 basis point equals 0.01%.  Investors looked to the latest data & remarks from Federal Reserve officials as they weighed the outlook for the economy.  This comes amid uncertainty about when, & how often, the Fed will cut interest rates this year after central bank officials have repeatedly said their decision-making would depend on the state of the economy.  Some policymakers have also said that they believe there could be fewer than the forecast three rate cuts this year.  Durable goods orders rose by more than expected in Feb while the latest consumer confidence report indicated declining optimism about the economy.

Treasury yields slide as investors weigh economic outlook

Fed Governor Christopher Waller will give remarks later today.  The bulls are hoping he will bring an optimistic message for stocks.

Dow Jones Industrials 

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