U.S. and World News
- Apple is the first major U.S. company to announce that they will not meet their revenue projections for the current quarter as a result of the coronavirus outbreak, now called COVID-19. China announced that they would consider direct cash infusions and mergers to bail out its airline industry, which is estimated to be hit by losses of $28 billion in 2020. Data releases from China this morning show that Chinese car sales fell by 92% so far in the month of February. As of this morning, there have been more than 76,000 cases, and 2,247 deaths according to the World Health Organization. China had also reported 271 infections among prisoners, raising additional questions about the spread of the virus. Outside of China, there are 1,152 cases across 26 countries, including eight deaths. Coronavirus cases have increased rapidly in South Korea and Iran recently, with the number of cases in South Korea doubling overnight to 204. World health officials announced that there are 18 new cases and four deaths in Iran within just two days. Two clinical trials are currently underway to test treatments for the virus and preliminary results are expected to be released in three weeks.
- This morning, the United Nations warned that the conflict in northwest Syria could “end in a bloodbath”, calling for a ceasefire. There were reports of civilians fleeing a Russian-led Syrian attack in large numbers, but Russia has denied these reports. Syrian troops have been working to eliminate rebel strongholds in northwest Syria with the help of Russian war planes and has left an estimated 400,000 Syrians dead, millions displaced, and landscapes destroyed. Approximately 1 million people, mostly women and children, have fled these areas seeking asylum north of the Turkish border. The front lines of the offensive, which includes frequent bombardments, is moving very close to areas packed with the displaced civilians. Turkey has indicated that it cannot handle any more refugees and that it will use military power to stop the Syrian offensive.
- Markets pulled back this week. The S&P 500 lost 1.22% and closed at 3,338. The Dow Jones fell 1.36% and closed at 28,992. Year-to-date, the S&P is up 3.58% and the Dow Jones is up 1.94%.
- Yields moved lower this week. The 5 year and 10 year U.S. Treasury Notes are yielding 1.32% and 1.47%, respectively.
- The spot price of WTI Crude rose this week. Prices rose 1.95% and closed at $53.34 per barrel. Year to date, Oil prices are down 12.64%.
- The spot price of Gold rose by 3.77% and closed at $1,643.71 per ounce. Year to date, Gold prices are up 8.33%.
- Initial jobless claims rose by 4,000 to 210,000 and the four-week moving average of claims fell 3,000 to 209,000. Claims rose by 2,000 in California.
- The Philadelphia Fed manufacturing index rose by 19.7 to 36.7 versus expectations for a rise of 11.0
- Housing starts fell by 3.6% to a seasonally-adjusted-annualized rate of 1,567k versus expectations for a decline of 11.2%
- Building permits rose by 9.2% versus expectations for an increase of 2.1%
- The producer price index rose by 0.5% and the year-over-year rate rose by 2.1% versus expectations for an increase of 0.1%
- Existing home sales fell by 1.3% to a seasonally-adjusted-annualized rate of 5.46 million units versus expectations for a decline of 1.8%
Fact of the Week
The House passed HR # 2534 on 12/5/19. The bill explicitly defines and prohibits “insider trading”. There is currently no federal statute that explicitly prohibits “insider trading” ( Source: Insider Trading Prohibition Act)
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