Source:
For the week
ending on
October 30, 2020:
COVID-19 cases
spiked in the EU,
so LAST WEEK
asset prices declined:
Germany’s DAX down 8.6%,
Dow Industrials down 6.5%
France's CAC40 down 6.4%
Spain's IBEX 35 down 6.4%
Italy's FTSE MIB down 7.0%
Brazil's Bovespa down 7.2%
Crude oil was down 10%,
Platinum was down 6.4%.
GLOBAL STOCKS:
S&P500 down 5.6%
(up 1.2% y-t-d)
Dow Industrials down 6.5%
(down 7.1%)
Dow Utilities down 3.5%
(down 1.2%)
Dow Transports down 6.5%
(up 1.9%)
S&P 400 Midcaps down 5.7%
(down 7.9%)
Small cap Russell 2000 down 6.2%
(down 7.8%)
Nasdaq100 down 5.5%
(up 26.6%)
Biotechs down 3.0%
(up 2.9%).
With gold bullion down $23,
the HUI gold stock index
fell 2.8% (up 30.0% y-t-d)
U.K.'s FTSE down 4.8%
(down 26.1% y-t-d)
Japan's Nikkei down 2.3%
(down 2.9% y-t-d)
France's CAC40 down 6.4%
(down 23.1%)
German DAX down 8.6%
(down 12.8%)
Spain's IBEX 35 down 6.4%
(down 32.4%)
Italy's FTSE MIB down 7.0%
(down 23.7%)
Brazil's Bovespa down 7.2%
(down 18.8%)
Mexico's Bolsa down 4.4%
(down 15.1%)
South Korea's Kospi down 4.0%
(up 3.2%)
India's Sensex down 2.6%
(down 4.0%)
China's Shanghai down 1.6%
(up 5.7%)
Turkey's Istanbul
National 100 index
down 6.6%
(down 2.8%)
Russia's MICEX down 4.5%
(down 11.7%).
US BONDS & MORTGAGES
Ten-year US Treasury bond yields
rose three bps to 0.875%
(down 104bps year over year(
Freddie Mac 30-year
fixed mortgage rates
added a basis point to 2.81%
(down 97bps y-o-y).
Fifteen-year rates
slipped a basis point
to an all-time low 2.32%
(down 87bps).
Five-year hybrid ARM rates
increased one basis point to 2.88%
(down 55bps).
Jumbo mortgage
30-year fixed rates
down six bps
to a record low 3.03%
(down 108bps).
Federal Reserve Credit
over the past year,
expanded 80%.
M2 money 23.8%
over the past year.
COMMODITIES:
Bloomberg Commodities
Index declined 2.3%
(down 11.2% y-t-d).
Spot Gold gold 1.2% to $1,879
(up 23.8%).
Spot Silver down 4.2% to $23.65
(up 31.9%).
WTI crude oil down $4.06 to $35.79
(down 41%).
Gasoline down 9.4%
(down 39%)
Natural Gas up 12.9%
(up 24%)
Copper down 2.6%
(up 9%)
Wheat down 5.4%
(up 7%)
Corn down 4.9%
(up 3%).
BAD COVID-19 NEWS
LAST WEEK:
Daily infections in France
averaged about 550 during June.
They had surged to 13,970
by the first day of October.
A record 52,013 infections
were reported last Sunday
and 49,000 on Friday.
Spain has observed daily
infections surge from
several hundred in June
to Friday’s 25,595.
In the UK, after averaging
below 1,000 in the summer,
new cases averaged about
25,000 over the past week.
(1)
October 26
– Wall Street Journal
(Stacy Meichtry,
Joanna Sugden and
Andrew Barnett):
“ Family members who willingly sealed themselves off during spring lockdowns are suddenly finding it hard to resist the urge to reunite… The collective exhaustion—known as pandemic fatigue—has emerged as a formidable adversary for governments that are counting on a high degree of public cooperation... Too much pandemic fatigue, authorities say, can fuel a vicious cycle: A tired public tends to let its guard down, triggering more infections and restrictions that in turn compound the fatigue.”
(2)
October 26
– Bloomberg
(Jonathan Levin):
“The record Covid-19 spike that started with young Americans is increasingly finding older communities at elevated risk of severe illness. Counties with the largest 65-and-over populations are now recording on average 18.9 daily cases per 100,000 residents, 67% higher than a month ago, according to… the U.S. Centers for Disease Control and Prevention.”
(3)
October 28
– Associated Press
(Todd Richmond,
Frank Jordans and
John O’Connor):
“A new wave of lockdowns and business closings swept across France, Germany and other places in Europe… as surging coronavirus infections there and in the U.S. wipe out months of progress against the scourge on two continents/"
(4)
October 25
– Financial Times
(Miles Johnson and
Daniel Dombey):
“Italy said it would introduce the harshest public health restrictions since the end of its first national lockdown in May as new coronavirus cases hit a fresh daily record. Spain announced a nationwide curfew and triggered emergency powers after the country’s infection rate jumped by almost a third over the past week.”
(5)
October 27
– Wall Street Journal
(Noemie Bisserbe):
“France ... saw daily cases top 50,000 over the weekend, while the seven-day average of new daily cases has increased by more than 50% over the past week, reaching 38,278 on Tuesday.”
(6)
October 30
– Reuters
(Alistair Smout):
“New COVID-19 cases in England increased by around 51,900 each day last week, up nearly 50% on the week before, an official survey said on Friday, suggesting that the incidence of new infections was still rising steeply and had not leveled off.”
(7)
October 26
– Wall Street Journal
(Stephen Fidler):
“A large English study showed the number of people with Covid-19 antibodies declined significantly over the summer, suggesting that getting the virus might not confer long-lasting immunity from future infection. The survey of 365,000 adults in England who tested themselves at home using a finger-prick test showed the proportion of people testing positive for Covid-19 antibodies declined by 26.5% between June 20—12 weeks after the peak of infections in the country—and Sept. 28. The results also suggested that people who didn’t display symptoms were likely to lose detectable antibodies before those who had showed symptoms.”
OTHER NEWS:
(8)
October 26
– Reuters
(Sanjeev Miglani,
Neha Arora,
Devjyot Ghoshal,
Alasdair Pal and
Yew Lun Tian):
“The United States and India signed a pact to share sensitive satellite and map data… as U.S. Secretary of State Mike Pompeo warned of the threat posed by an increasingly assertive China.
(9)
October 30
– Bloomberg
(Ben Steverman):
“Four years ago, America elected its first billionaire president. Since then, the nation’s 200-or-so wealthiest people -- a cohort representing 0.00006% of the population – have increased their combined wealth by a staggering $1 trillion. Now, in a moment of peril, a polarized nation is voting again. The outcome will not only determine America’s future, but also the arc of the country’s largest fortunes.”
(10)
October 28
– Reuters
(Jonnelle Marte):
“About half of the 22 million who lost their jobs during the pandemic are still out of work. New hiring is slowing, dimming prospects for the low-wage workers hit hardest by job losses. Infections of the virus that killed more than 225,000 Americans are rising to new records. Hotels, transportation companies and food providers warn that more layoffs are coming, and the government aid that helped many pay the bills is long gone."
(11)
October 28
– Wall Street Journal
(Heather Gillers and Gunjan Banerji):
“U.S. states are facing their biggest cash crisis since the Great Depression. Nationwide, the U.S. state budget shortfall from 2020 through 2022 could amount to about $434 billion, according to… Moody’s Analytics … Deficits have already prompted tax hikes and cuts to education, corrections and parks. State workers are being laid off and are taking pay cuts, and the retirement benefits for police, firefighters, teachers and other government workers are under more pressure.”
(12)
October 27
– Wall Street Journal
(Will Parker):
“Fallout from missed rent payments is threatening a swath of the U.S. population, as the expiration of eviction bans draws near. A large number of renters have been unable to pay some or even all of their rent since March… Many businesses remain closed or only partially open, pushing renters into unemployment and draining their savings. Federal and local eviction moratoriums have protected many of them from losing their homes if they missed payments during the pandemic. But the national eviction ban and some state and city protections are set to expire by January or sooner.”
(13)
October 29
– CNBC
(Fred Imbert):
“The number of first-time unemployment-benefits filers fell to the lowest level in the pandemic, declining for a second straight week… Initial weekly U.S. jobless claims came in at 751,000 for the week ending Oct. 24, down 40,000 from the previous week… It was the lowest initial claims total since the week of March 14, when they came in at 282,000.”
(14)
October 27
– CNBC
(Diana Olick):
“Home price gains ... beat expectations, rising 5.7% annually in August, up from 4.8% in July, according to the S&P CoreLogic Case-Shiller National Home Price Index. The 10-City Composite posted a 4.7% gain, up from 3.5% in the previous month. The 20-City Composite rose 5.2% year-over-year, up from 4.1% in July"(15)
(15)
October 27
– Reuters
(Lucia Mutikani):
“New orders for key U.S.-made capital goods increased to six-year high in September, wrapping up a quarter of potentially record growth in business spending and the economy, thanks to fiscal stimulus aimed at softening the blow from the COVID-19 pandemic.
(16)
October 28
– Bloomberg
(Michelle Kaske):
“The New York City region is at risk of losing an estimated $65 billion in gross domestic product annually if the federal government fails to allocate billions in aid to the Metropolitan Transportation Authority, according a report… Without help from Washington, the nation’s largest public transit agency will have to drastically curtail services and lay off staff. That would reverberate through the New York City regional economy, potentially costing 450,000 jobs by 2022 and a $50 billion yearly loss in earnings in addition to the GDP blow, Pat Foye, MTA’s chief executive officer, said…”
(17)
October 26
– Bloomberg
(Jeremy Hill and
Max Reyes):
“Bankruptcy filings are surging due to the economic fallout of Covid-19, and many lenders are coming to the realization that their claims are almost completely worthless. Instead of recouping, say, 40 cents for every dollar owed, as has been the norm for years, unsecured creditors now face the unenviable prospect of walking away with just pennies -- if that.”
(19)
October 27
– CNBC
(Evelyn Cheng):
“Chinese companies are piling into what they see as a window of opportunity to raise billions from global stock markets… Just take Alibaba-affiliated fintech giant Ant Group, which is set to launch its long-awaited, massive initial public offering … One-fifth of global public listings in the first nine months of this year, or 180 of them, took place on the Shanghai Stock Exchange, according to… Ernst & Young… That made Shanghai the top market, surpassing second-place Nasdaq’s 119 deals. Add in 115 IPOs in Shenzhen and 99 in Hong Kong, and greater China stock exchanges accounted for 45% of global IPOs in the first three quarters of the year…”
(20)
October 26
– Bloomberg:
“China will impose unspecified sanctions on Boeing Co.’s defense unit, Lockheed Martin Corp. and Raytheon Technologies Corp. after the U.S. State Department approved $1.8 billion in arms sales to Taiwan last week. The sanctions will be imposed ‘in order to uphold national interests,’ Chinese Foreign Ministry spokesman Zhao Lijian told reporters…”
(21)
October 30
– Bloomberg
(Mario Sergio Lima):
“Brazil’s unemployment rose for the eighth straight month to a record high as the end of anti-virus lockdowns lures droves of job seekers back to the labor market. The jobless rate rose to 14.4% in the three months through August…”
(22)
October 26
– Reuters
(Crispian Balmer):
“Protests flared across Italy… against a new round of government restrictions aimed at curbing a resurgent coronavirus, with violence reported in at least two major northern cities, Milan and Turin.”
(23)
October 27
– Reuters
(Svea Herbst-Bayliss):
“Technology stocks, which have surged for months during the pandemic, likely hit their top last month, hedge fund investor David Einhorn wrote… Einhorn, who runs Greenlight Capital, wrote in a letter ‘we are in the midst of an enormous tech bubble,’ but noted “September 2, 2020 was the top and the bubble has already popped.’”
(24)
October 27
– Bloomberg
(Ben Bartenstein):
“Relations between the world’s two largest economies will deteriorate further no matter who wins the U.S. presidential election, according to Ian Bremmer, who heads the risk consultant Eurasia Group. The… political scientist said U.S. criticism of Beijing’s detention of Uighurs as well as disagreements over Hong Kong, Taiwan, the South China Sea, intellectual property, trade and technology will escalate under the administrations of Joe Biden or President Donald Trump. ‘There will be an enormous amount of confrontation and no trust between the U.S. and China, even if Biden becomes president,’ Bremmer said…”
(25)
October 27
– Financial Times
(Amy Kazmin):
“After 20 Indian soldiers were killed in a skirmish with Chinese troops along the Himalayan border this summer, New Delhi quietly dispatched a frontline warship on an unusual voyage to the South China Sea. Little was revealed publicly about the vessel or its mission. But Indian security analysts saw its unexpected presence in the heavily disputed waters as a clear warning to Beijing… ‘The message was: Don’t mess in my backyard or otherwise I’ll mess in your backyard,’ said Nitin Pai, director of the Takshashila Institution…”
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