Financial & Economic News last week

S&P500  last week

was up 2.5% 

    (up 3.7% y-t-d)

Dow Industrials 

up 3.8% 

    (down 3.9%)

Dow Utilities up 1.2% 

(down 3.5%)

Dow Transports 

up 5.8% 

   (down 3.0%)

S&P 400 Midcaps 

jumped 4.0% 

     (down 6.0%)

Small cap Russell 2000 

up 6.0% 

     (down 6.0%)

Nasdaq100  

up 2.1% 

   (up 27.6%)

Biotechs 

up 0.4% 

   (up 12.0%)

Gold bullion 

rose another $60, 

the HUI gold stock index 

was little changed 

    (up 45.0%).

U.K.'s 

FTSE  up 2.3% 

   (down 20.0%).

Japan's 

Nikkei up 2.9% 

   (down 5.6% y-t-d).

France's 

CAC40 up 2.2% 

   (down 18.2%).

German 

DAX up 2.9% 

   (down 4.3%). 

Spain's 

IBEX 35 up 1.1% 

   (down 27.2%). 

Italy's 

FTSE MIB  up  2.2% 

   (down 17.0%).

Brazil's 

Bovespa little changed 

   (down 11.1%)

South Korea's 

Kospi up 4.5% 

   (up 7.0%). 

India's 

Sensex up1.2% 

   (down 7.8%). 

China's 

Shanghai up 1.3% 

   (up 10.0%). 

Russia's 

MICEX  up 2.1% 

   (down 2.4%).

US  Mortgage  Rates:

Freddie Mac 

30-year fixed mortgage rates 

sank 11 bps to 2.88% 

    (down 72bps y-o-y). 

Fifteen-year rates 

fell seven bps to 2.44% 

  (down 61bps). 

Five-year hybrid ARM rates 

declined four bps to 2.90% 

   (down 46bps). 

Jumbo mortgage 30-year fixed rates 

unchanged at 3.12% 

   (down 88bps).

Commodities:

Bloomberg Commodities Index 

jumped 2.6% 

   (down 12.9% y-t-d). 

Spot Gold 

rose 3.0% to $2,036 

   (up 34.1%). 

Spot Silver 

surged 13.7% to $27.54 

   (up 54%). 

WTI crude oil

gained 95 cents to $41.22 

   (down 33%). 

Gasoline 

rose 3.1% 

   (down 29%)

Natural Gas 

surged 24.4% 

   (up 2%). 

Copper 

dropped 2.6% 

   (unchanged). 

Wheat 

sank 6.7% 

   (down 11%). 

Corn 

fell 1.9% 

   (down 17%).

Federal Reserve Credit

expanded 84.5% 

over the past year !!!

M2 (narrow) 

"money" supply 

expanded 22.7%, 

over the past year. 

               News:

August 4 – Reuters (Benjamin Lesser, 

Dan Levine, Jaimi Dowdell and Andrea Januta): 

“The soaring number of COVID-19 cases in the United States has far outstripped many local health departments’ ability to trace the contacts of those infected, a step critical in containing the virus’ spread. With the pandemic claiming about a thousand American lives a day, many city and county departments say they lack the money and staff to expeditiously identify people who have been exposed… The United States badly lags other wealthy countries in contact tracing…”

August 1 – Financial Times (Richard Henderson): 

“A strong year for the largest five US stocks despite the worst recession the country has faced in decades has further expanded their influence on equity markets. Apple, Microsoft, Amazon, Alphabet and Facebook now represent more than a fifth of the S&P 500. Not since the 1980s have the biggest five companies had such a large share of the index, according to S&P Dow Jones Indices.”

August 7– Bloomberg: 

“The U.S. president’s move to ban the Chinese-owned TikTok and WeChat in just over six weeks from now sent shockwaves through the tech industry and the many American businesses who rely on the apps to sell goods in China. The decision also spurred alarm on Chinese social media, with WeChat users in the U.S. posting contact information so friends and family could reach them if the app disappeared.”

August 5 – CNBC (Alicia Adamczyk): 

“By the end of August, over 5 million Americans will be unable to cover their basic expenses for a full month without the extra $600 in enhanced unemployment insurance payments that lapsed last week, according to Morning Consult. Some 30 million Americans are currently collecting jobless benefits, and they can continue to do so through the end of the year. But the extra $600 a week from the federal government that was provided under the CARES Act expired last week. Without that money, 44% of those currently collecting UI benefits will now receive less than $800 per month…”

August 3 – Bloomberg (Kim Bhasin): 

“Every week seems to bring another round of retail bankruptcies… Over the weekend, Tailored Brands Inc. -- the owner of Men’s Wearhouse and JoS. A. Bank -- and department store Lord & Taylor filed for Chapter 11… The previous week, it was Ann Taylor and Lane Bryant parent Ascena Retail Group Inc. At least 25 major retailers have now filed for bankruptcy this year, with 10 of these coming over the last five weeks… ‘The common denominator is debt,’ said Simeon Siegel, an analyst at BMO Capital Markets. ‘At this point, now everyone has debt. Everyone took on massive amounts of liquidity.’”

August 4 – CNBC (Diana Olick): 

“Nationally, home prices increased by 4.9% annually in June, a much greater gain than the 4.1% annual rise in May, according to CoreLogic. Prices climbed 1% month to month, which is the fastest monthly gain for June since 2013. Prices got a boost from record low mortgage rates… The average rate on the popular 30-year fixed mortgage jumped up to 3.24% at the start of the month, but then fell precipitously, ending June at 2.94%...”

August 5 – Bloomberg (Amanda Albright): 

“America’s municipal bondholders have never been paid so little for taking on so much risk. The yields on state and local government bonds have steadily dwindled over the past month, even as the resurgent coronavirus pandemic is threatening to prolong the deep recession that’s dealing a financial setback to borrowers in virtually every corner of the $3.9 trillion market. The oldest gauge of municipal yields, the Bond Buyer index of those on 20-year general-obligation bonds, now stands at 2.09%, the lowest since 1952.”

August 4 – Bloomberg: 

“Vehicle sales advanced for a fourth straight month in China… Sales of passenger cars such as sedans and SUVs, as well as commercial vehicles, increased 14.9% in July from a year earlier to 2.08 million units, the China Association of Automobile Manufacturers said… From January to July, vehicle sales declined by 12.7% to 12.3 million units.”