Monday, May 3, 2021

Markets jump to start the month on a positive note

Markets shot up 316, advancers over decliners 5-2 & NAZ gained 34.  The MLP index added 1 to the 176s & the REIT index fell 1+ to the 431s (still in record territory).  Junk bond funds crawled higher & Treasuries were in heavy demand.  Oil went over 64 again & gold soared 29 to 1797.

AMJ (Alerian MLP index tracking fund)







CL=FCrude Oil64.22
  +0.64+1.0%






GC=FGold  1,792.30
 +24.60+1.4%















 

 




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Berkshire Hathaway (BRK.A) is seeing inflation among Berkshire Hathaway's collection of businesses as the economic recovery from the pandemic kicks into high gear.  “We are seeing very substantial inflation,” the Berkshire chairman and CEO said.  “It’s very interesting. We are raising prices. People are raising prices to us and it’s being accepted.”  “We’ve got nine home builders in addition to our manufactured housing and operation, which is the largest in the country. So we really do a lot of housing. The costs are just up, up, up. Steel costs, you know, just every day they’re going up,” he added.  Berkshire Hathaway owns one of the nation's largest homebuilders Clayton Homes, along with companies such as Benjamin Moore paints & Shaw flooring.  Inflation has begun to accelerate recently due to multiple factors, including increasing demand & struggles with some areas of the supply chain, as well as just easier comparisons with the pace of a year ago.  The core personal consumption expenditure price index, which excluded volatile food & energy prices, rose 1.8% in Mar, the fastest pace since Feb 2020.  The headline number increased 2.3%, the quickest pace for that measure since 2018.

Buffett says Berkshire is seeing ‘very substantial inflation’ and raising prices

New cases of Covid-19 are dropping sharply across the US as Ms of people get vaccinated daily, fueling optimism that the nation may have averted the surge of infections gripping other parts of the world & is finally turning the corner on what was one of the worse outbreaks globally.  The latest 7-day average of daily new cases fell to under 50K for the first time since Oct & is down 17% from a week prior, according to Johns Hopkins University.  Hospitalizations & deaths from the disease are also falling. . Cases are falling as more Americans get vaccinated.  To date, more than 100M people in the US have been fully vaccinated against Covid-19, according to the Centers for Disease Control & Prevention, nearly 1/3 of the population.  About 146M people, 44% of the population, has received at least one dose of a vaccine.  He said that the precipitous drop in new Covid-19 cases in the US was likely to continue, predicting a “relatively quiet summer when it comes to coronavirus spread.”  “Look, the situation in the U.S. continues to improve, and I think in the coming weeks we are going to see an acceleration in the decline in cases,” Gottlieb added.  The physician credited the mass vaccination campaign that got underway under Pres Trump & has been continued under Pres Biden for the country's ability to rein in the spread of the disease.

Covid cases fall sharply in U.S., Gottlieb calls vaccination campaign ‘monumental achievement’

White House Chief of Staff Ron Klain said that the Biden administration is looking to distribute the coronavirus vaccine to India & other countries now that Ms of Americans have received their doses.  In recent weeks, India has grappled with a staggering rise in new coronavirus infections.  Over the weekend, India reported 400K daily cases, bringing the nation's cumulative total to almost 20M cases, according to Johns Hopkins.  The spike may have been triggered by a highly contagious Covid variant, known as B.1.617, which was first identified in the country.  The variant has since been identified in other countries, including the US.  On Fri, the White House announced that it would restrict travel from India as the country works to counter its surge of Covid-19 infections.  “We are rushing aid to India,” Klain said.  Klain said that the US has sent therapeutics, rapid diagnostic test kits, ventilators & protective equipment to the world's largest democracy as well as raw materials crucial for vaccine production.  “Our U.S. Trade Representative Katherine Tai is going to the WTO next week to start talks on how we can get this vaccine more widely distributed, more widely licensed, more widely shared,” he said when asked if the Biden administration would relax patent protections on the coronavirus vaccine.

U.S. to discuss wider Covid vaccine licensing as India calls to waive patent protections

The bulls are back in command after a sluggish week.  However, there is also buying in Treasuries & gold, classic safe heaven investments.  Inflation, especially from proposed massive gov spending, continues to be a worry for investors.

Dow Jones Industrials

 






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