Friday, February 5, 2021

Markets advance after improvement in the unemployment rate

Dow rose 78, advancers over decliners better than 2-1 & NAZ went up 23 to another record.  The MLP index was little changed in the 149s & the REIT index added 1+ to the 384s.  Junk bond funds crawled higher & Treasuries continued to be sold.  Oil went up to almost 57 & gold jumped 16 to 1807.

AMJ (Alerian MLP index tracking fund)

CL=FCrude Oil56.79 
+0.56+1.0%





























GC=FGold   1,805.50
+14.30+0.8%





















 

 




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The US economy added 49K jobs in Jan, rebounding from a surprise employment decline in Dec as a slowdown in COVID-19 cases nationwide allowed states to ease lockdown measures on businesses.  The unemployment rate edged down to 6.3% — well below the Apr peak of 14.7%, but about twice the pre-crisis level, the Labor Dept said in its monthly payroll report.  The forecast called for the report to show that unemployment remained unchanged at 6.7% & the economy added 50K jobs.  In total, the US has recovered roughly ½ of the 22M jobs lost during the first 2 months of the pandemic.  There are still about 9.9M more Americans out of work than there were in Feb before the crisis began.  The fall in the unemployment rate in part reflected adjustments by the Labor Dept to population estimates used to calculate the unemployment rate & other data points.  The new projections show the civilian labor force was 200K lower than previously estimated, employment was 180K less & unemployment was 20K less.  After a sharp contraction in Mar & Apr, the labor market quickly rebounded, adding 9.3M jobs in the span of just 3 months.  But since then, job growth has cooled dramatically each month, with economists increasingly warning that the recovery could plateau — or reverse itself.  The broader economic recovery has sputtered in recent months: Unemployment claims, a proxy for layoffs, have remained at about 4-times their pre-crisis level.  Consumer spending fell as Americans stayed home — & those who ventured out had limited options.  GDP, the broadest measure of goods & services, grew just 1% in the final 3 months of the year, compared with an increase of 7.5% between the 2nd & 3rd qtrs.  Employers overall cut 227K jobs in Dec, the Labor Dept said in revised figures, a sharp decline of 72K from the initially reported 140K.  Nov's gains were also revised lower, to 264K from 336K.

US economy added 49K jobs in January

The Senate signaled overwhelming support for limiting wealthy Americans from receiving a 3rd stimulus check in the latest coronavirus relief package.  The chamber voted 99-1 on an amendment proposed by Sens Joe Manchin & Susan Collins, barring "upper-income taxpayers" from eligibility for the direct cash payments.  "The question before us is quite simple. Do we want stimulus checks to go to households with family incomes of $300,000?" Collins asked during the Senate's "vote-a-rama" on last night.  "Or do we want to target the assistance to struggling families who need the help and provide a boost for the economy?"  While the vote is non-binding, the broad support for the amendment suggests that lawmakers are open to lowering the income threshold for the payments, even as Dems move forward with using their slimmest-possible majority to pass the measure without any Reps on board.  "I don't think a single person on this floor would disagree to target the relief to our neighbors who are struggling," Manchin said.  "There are other families who have not missed a single paycheck as a result of this pandemic. It does not make sense to send a check to those individuals."  While the amendment does not specify levels of eligibility for the checks, it reflects a growing belief among some members of both parties that the payments would be most effective if they were more narrowly distributed to lower-income Americans.

Senate signals bipartisan support for more targeted $1,400 stimulus checks

Johnson & Johnson (JNJ), a Dow stock & Dividend Aristocrat, submitted its single-dose COVID-19 vaccine candidate for emergency use authorization to the Food & Drug Administration calling it a "pivotal step forward" to "putting an end to the pandemic."  The move by the pharmaceutical giant comes after it released data last week showing it was about 72% effective in the US protecting against the virus.  If approved it would be the 4rd vaccine authorized in the US.  “Today’s submission for Emergency Use Authorization of our investigational single-shot COVID-19 vaccine is a pivotal step toward reducing the burden of disease for people globally and putting an end to the pandemic,” JNJ chief scientific officer & vice-chair Paul Stoffels said.  Once authorized, the vaccine is "ready to begin shipping," stated Stoffels who added that the company in conjunction with health authorities around the world "are working with great urgency to make our investigational vaccine available to the public as quickly as possible.”  JNJ has previously said it expects to supply 100M doses to the US by Jun.  If authorized, the vaccine is estimated to remain stable for 2 years at -4 degrees Fahrenheit, or -20 degrees Celsius, & in most standard refrigerators at temperatures of 36-46 degrees Fahrenheit for at least 3 months.  The stock went up 2.37
If you would like to learn more about JNJ, click on this link:
club.ino.com/trend/analysis/stock/JNJ?a_aid=CD3289&a_bid=6ae5b6f7

Johnson & Johnson submits single-dose COVID-19 vaccine candidate to FDA for emergency use authorization

Trading is choppy after a reduction in the unemployment rate & weak data on jobs created.  The Dems in DC are looking to pass another stimulus bill following the vote last night in the Senate.  The stock market should remain choppy in the PM assuming there is no breaking news on the stimulus package.

Dow Jones Industrials

 






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