Markets rebound after Biden says lockdowns are not needed for now

Dow bounced back 236 (150 below session's high), advancers over decliners about 5-4 & NAZ jumped 291.  The MLP index fell 3+ to 177 & the REIT index climbed 4+ to the 478s.  Junk bond funds inched higher & Treasuries were sold, bringing higher yields.  Oil rose 1+ to the 69s (below session highs) & gold crawled up 2 ro 1785 (more on both below).

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Pending home sales rebounded in Oct, motivated by fast-rising rents & an anticipated increase in mortgage rates.  According to the National Association of Realtors' (NAR) pending home sales index, which tracks the number of homes that are under contract to be sold, rose 7.5% to a reading of 125.2, but are down 1.4% year-over-year.  An index of 100 is equal to the level of contract activity in 2001.  Contract signings rose at the strongest pace in the Midwest & South regions, climbing 11.8% to 124.6 & 8% to 149.7, respectively.  Meanwhile, pending home sales in the Northeast increased 6.9% to 99.5, a 10% drop compared to a year ago & grew 2.1% in the West to 107.5, down 6.2% year-over-year.  The latest real estate data comes after existing home sales rose 0.8% in Oct to a seasonally adjusted rate of 6.3M units, the fastest pace since Jan.  Total housing inventory in Oct fell 0.8% month-over-month & 12% year-over-year to 1.25M units.  Unsold inventory, which is at a 2.4-month supply at the current sales pace, remains unchanged from the previous month & is down from 2.5 months a year ago.  "This solid buying is a testament to demand still being relatively high, as it is occ urring during a time when inventory is still markedly low," NAR chief economist Lawrence Yun said.  "The notable gain in October assures that total existing-home sales in 2021 will exceed 6 million, which will shape up to be the best performance in 15 years." 

Pending home sales rebound on fast-rising rents, mortgage rates

Consumers are projected to spend $10.2-11.3B on Cyber Monday, making it the biggest online shopping day of 2021, according to new data from Adobe.  By comparison, US consumers doled out $10.8B during Cyber Monday last year.  This year's prediction comes just after Adobe saw decreased online spending on Thanksgiving Day & Black Friday for the first time since 2012, when the firm first began reporting on e-commerce. Black Friday sales totaled $8.9B, down from $9B in 2020, while Thanksgiving Day shopping amounted to $5.1B in spending, which was equal to last year's total.  Online shopping was also down on both Sat & Sun.  Consumers spent a total of  $4.5B on Nov 27, down 4.3% year over year, while consumers spent $4.7B on Nov 28, down 0.5% compared to 2020.  Adobe says figures on these big shopping days are down in part because consumers began filling their virtual shopping carts earlier this season.  During Nov 1-28, consumers spent $99.1B, which is up 13.6% compared to a year ago.  "Online sales on big shopping days like Thanksgiving and Black Friday are decreasing for the first time in history, and it is beginning to smooth out the shape of the overall season," Taylor Schreiner, Adobe's digital insights director, said.  So far, 21 days in Nov have already exceeded $3B in online spending.  By this time last year, only 8 days surpassed the $3B mark.  "It shows not only the effectiveness of early deals in Oct. 2021, but also how much consumers have taken supply chain issues seriously," Adobe said.  Adobe projects spending over the course of the entire season, Nov 1 - Dec 31, to hit $207B in online spending, which is a 10% growth compared to a year ago.

Cyber Monday shopping: Consumers projected to spend up to $11.3B

Pres Biden's administration stands ready to release even more barrels of oil from its strategic reserves should the need arise again, according to the State Dept's senior advisor for global energy security.  “Absolutely. This is a tool that was available to us and will be available again,” Amos Hochstein said in Dubai, the UAE.  His comments come as energy analysts assess the effectiveness of a US-led pledge to release Ms of barrels of oil from strategic reserves after OPEC+ producers had resisted calls to pump more to help cool the market.  “Remember, this was not a 50-million-barrel release, 30 million barrels were an exchange where companies and traders can take the oil now and return it over a scheduled period of time. That means the Strategic Petroleum Reserve will be replenished,” Hochstein added.  “And therefore, we have more flexibility to be able to do this again in the future if the need arises. I think we wanted to do something that was impactful for the market and that also had the ability and the flexibility to allow us to do that again should the need arise for the American economy.”  In the first such move of its kind, Biden announced on Nov 23 the coordinated release of oil between the US, India, China, Japan, South Korea & the UK.

U.S. energy envoy says Biden stands ready to release even more oil reserves

Pfizer (PFE) CEO Albert Bourla said he expects the company’s Covid-19 treatment pill to be effective against the omicron variant of the virus causes Covid-19.  “The good news when it comes to our treatment, it was designed with that in mind, it was designed with the fact that most mutations are coming in the spikes,” Bourla added.  “So that gives me very high level of confidence that the treatment will not be affected, our oral treatment will not be affected by this virus.”  PFE submitted its application earlier this month to the Food & Drug Administration to authorize the pill, Paxlovid, for emergency use.  In a clinical trial of people age 18 & over, PFE found the pill reduces hospitalization & death by 89% when taken with a widely used HIV drug within 3 days of the start of symptoms.  The pill blocks an enzyme the virus needs to replicate.  It is used in combination with HIV drug ritonavir, which slows the human metabolism to allow the Paxlovid to remain active in the body longer at a higher concentration to combat the virus.  Bourla said that PFE now expects to manufacture 80M courses of the pill, an increase from the company's original 50M manufacturing goal. The Biden administration has already bought 10M courses of Paxlovid in a $5M deal.  The stock was off 1.60.
If you would like to learn more about PFE, click on this link:
club.ino.com/trend/analysis/stock/PFE?a_aid=CD3289&a_bid=6ae5b6f7

Pfizer CEO confident Covid treatment pill will be effective against new variant

Gold futures declined, with prices for the haven metal settling below $1800 an ounce for a 4th session in a row — failing to find much support even as the emergence of a new coronavirus variant sparked a US stock market selloff on Black Friday.  Feb gold edged down by $2 to settle at $1785 an ounce.  Dec, the front-month contract, lost $3 to end at $1782 an ounce.  Based on the most actively traded contracts, prices fell 3.6% last week & haven't settled above $1800 since Nov 22.  Trading on Fri saw gold rise but most of its early gain receded in a shortened session the day after Thanksgiving, as the World Health Organization's technical advisory group declared omicron a “variant of concern,” with several countries imposing flight bans from countries in southern Africa.  Treasury yields were rising today as US benchmark stock indices were mixed in the wake of their worst day in more than a year on Fri.

Gold futures settle below $1,800 for a 4th straight session

Oil futures rallied to recoup a portion of the steep decline on Fri, as markets scrambled to assess the coronavirus variant omicron.  Investors are also awaiting the outcome of this week's OPEC meetings, some of which have reportedly been delayed due to recent price action.  Declared a “variant of concern” by the World Health Organization’s technical advisory group, the new strain has sparked fresh travel restrictions around the globe.  For the commodity, investors are worried about weakness in demand as recoveries potentially get tripped up.  West Texas Intermediate crude for Jan was up $1.80 (2.6%) to settle at $69.95 a barrel, after touching an intraday high at $72.93.  The contract slid $10.24 (13.1%) to close at $68.15 a barrel on Fri, the biggest one-day drop for a front-month contract since Apr 2020.  Global benchmark Jan Brent, which expires at the end of tomorrow's trading session, rose 72¢ (1%) to $73.44 a barrel.  On Fri, Brent tumbled $9.50 (11.6%) to $72.72 a barrel, the biggest one-day percentage decline since Apr 2020, with both WTI & Brent seeing their lowest closes since Sep 9.  Fri's selloff came on a shortened day of trading following the Thanksgiving Day holiday, with lower volumes potentially exacerbating any moves.  The view that Fri's selling went too far was gaining momentum at the start of the week, as US benchmark stock indices traded on a mixed note.  A growing view emerging from last week is that the sharp selloff will give major oil producing nations a reason to pause planned production increases.  A pair of technical meetings for OPEC+ this week has reportedly been shifted so that the group can assess the variant.  OPEC & allies (OPEC+) pushed a joint technical committee to Wed from today.  A joint ministerial monitoring committee has reportedly been shifted to Thurs from Tues.  Meanwhile, negotiations to restore the 2015 Joint Comprehensive Plan of Action, also known as the Iran nuclear deal, were held today, according to a tweet from Russian Ambassador Mikhail Ulyanov.  The participants agreed on “further immediate steps during the seventh round of negotiations which started quite successfully,” Ulyanov tweeted.

Oil prices claw back some of Friday’s rout, as traders eye omicron variant, OPEC+ developments

All considered this was a lackluster rebound for the stock market.  While tech stocks on NAZ were in demand, NYSE market breadth was not impressive.  Retail sales look to be good.  But the virus story remains unclear & those guys in DC have to fund the gov for the rest of the fiscal year raise the debt ceiling shortly.  There are also serious questions about demand for oil, which has ended oil's recent rally.  A lot of investors are nervous.    

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