Dow gained 35, advancers over decliners about 4-3 & NAZ was off 2 after being in the black all day. The MLP index rose 2+ to 149 & the REIT index was fractionally lower to the 381s, Junk bond funds crawled higher & Treasuries drifted lower in price. Oil rose almost 1 to the 55s & gold was about even at 1833 (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)
The number of global confirmed cases of the coronavirus-borne illness COVID-19 headed closer to 104M, with the US accounting for 26.4M, as it recorded another day of more than 3K fatalities. The US counted at least 114K new cases yesterday & at least 3408 died. Cases are continuing to fall, however. The US has averaged 141K cases a day in the past week, down 30% from the average 2 weeks ago. There was positive news in a study that found a single dose of the vaccine developed by Oxford Univ in cooperation with AstraZeneca (AZN) 76% protection for up to 3 months after a first dose and appears to help reduce transmission. The researchers found that vaccine efficacy was 76% after a first dose, with that protection maintained to the 2nd dose. The shot's effectiveness in preventing coronavirus disease rises to 82.4% once a 2nd dose is administered after 12 weeks. It also found a 67% reduction in positive COVID-19 swabs among those vaccinated, as a “substantial impact” on reducing transmission of the virus that causes the disease. But the researchers cautioned that a much bigger sample will be needed to reach definitive conclusions on transmission risk. Dr Anthony Fauci, head of the National Institute of Allergy & Infectious Diseases, said that the news was positive. “I’d like to see the data myself. If that’s true, it’s good news,” he added. “We’re going to have multiple candidates in the mix.” The COVID Tracking Project is showing that hospitalizations are also declining, with 93K COVID-19 patients in US hospitals yesterday, down from 94K a day earlier & the lowest figure since Nov 28. The number has declined for 22 straight days.
U.S. COVID cases continue to fall, even with one-day death rate still above 3,000
Gold & silver prices settled marginally higher to recoup a portion of losses from a day earlier, as trading for both metals looked to stabilize after silver made sizable moves in recent sessions. Apr gold climbed by $1 to settle at $1835 an ounce, after the metal tumbled 1.6% yesterday. Precious metals settled sharply lower a day ago after the Commodity Futures Trading Commission and the CME Group said they would monitor & tighten restrictions on trade in silver, & gold, with dealers blaming individual investors for using social-media platforms to drive futures prices in metals higher. Silver futures for Mar tacked on 49¢ (1.8%) to $26.89 an ounce today, following an over 10% decline for futures in the previous session. Prices on Mon settled at their highest in 8 years. The CME Group raised its margin requirements on silver futures to $16,500 per contract from $14K yesterday, requiring silver futures traders to put down more collateral to open a trading position. Prices dropped by more than 10% yesterday. Today's slight rebound for gold, however, is viewed by some market strategists as limited by a firmer $ & rising bond yields, which can serve as potential headwinds for the assets in the short term.
Gold, silver prices settle higher to recoup some of their recent losses
Dems may be forced to scale back their ambitions for a $1.9T coronavirus relief package as one key senator, West Virginia's Joe Manchin, has said he won't support trying to stretch the rules governing the budget process. At issue is the Byrd rule, named after Robert Byrd, a former senator also from West Virginia. The rule prohibits material from being in filibuster-proof bills that has a “merely incidental” budget effect, would raise the budget deficit after 10 years or affects Social Security. “We’re not going to bust the filibuster, we’re not going to bust the Byrd rule that basically protects the filibuster,” Manchin said. Today, Manchin said he had told Biden the same thing. “I said, ‘Fine Mr. President. I’m happy to start this process but I’m not going to bust the Byrd rule, I’m not going to basically get rid of the filibuster. We are going to work in a bipartisan way,'” he said. The House is expected to adopt the fiscal 2021 budget plan today that would set in motion the budget reconciliation process, which allows later spinoff bills to be immune to the filibuster in the Senate. Those bills, which would be subject to the Byrd rule, will be written by congressional committees by Feb 16 to meet deficit targets in the budget resolution.
Democrats may have to lower ambitions for relief bill as Manchin stands firm
The UK is scrambling to contain the spread of additional mutations of the coronavirus, with the more worrying variant first discovered in South Africa seen to be spontaneously emerging in different parts of the country. British Health Secretary Matt Hancock said the country had to “come down hard” on the South African variant after 105 cases were reported & 11 of those cases had no links to international travel. As such, the UK launched an enhanced testing program for around 80K living in areas where pockets of cases with the mutation have been found. Tests are being offered door-to-door & positive cases will be then be assessed to see if they are caused by the South African variant. People in those areas have been told to consider limiting the time they spend outside their homes as health authorities scramble to prevent the spread of yet another more infectious variant. One mutation, now known as the “British mutation,” has already become the dominant strain in many parts of the country.
Britain scrambles to contain Covid mutations, spread of variant from South Africa
Oil futures climbed to end at another one-year high, finding support from expectations that economic stimulus measures will boost energy demand and a modest weekly decline in US crude inventories. OPEC & their allies (OPEC+) held a monthly committee meeting, but did not make changes to output policy. The committee acknowledged Saudi Arabia's “significant additional voluntary supply adjustment” that took effect on Feb 1 & will run thru Mar. In Jan, the Saudis pledged to unilaterally cut its own output by 1M barrels a day to offset higher production from Russia & Kazakhstan. The committee also noted that overall conformity with original production cut adjustments was at 101%. Since Apr, OPEC+ has lowered output by a cumulative 2.1B barrels. West Texas Intermediate crude for Mar rose 93¢ (1.7%) to settle at $55.69 a barrel. Front-month contract prices posted another finish at the highest in a year. Apr Brent crude, the global benchmark, added $1 (1.7%) to $58.46 a barrel, settling at their highest since late Feb of last year. The Energy Information Administration reported that US crude inventories fell by 1M barrels last week, less than the decline of 2.4M barrels forecast. The American Petroleum Institute reported a 4.3M-barrel decline.
Oil finishes at 1-year high after modest weekly decline in U.S. crude inventories
NAZ had a decent gain, but selling in the last hour took it into the red. The fight against the virus is showing some improvement, but it sill seems like it will continue for some time. Tomorrow the weekly data on unemployment claims will be reported before the markets open. They have been trending sideways below 1M for several months.
Dow Jones Industrials
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