Written by Gary
CDC study finds roughly 78% of people hospitalized for Covid were overweight or obese (SPY +0.9%). American Airlines plans $5 billion bond sale and Markets not holding back on rate hike bets.
Here is the current market situation from CNN Money | |
 | North and South American markets are broadly higher today with shares in Brazil leading the region. The Bovespa is up 3.55% while Mexico’s IPC is up 1.31% and U.S.’s S&P 500 is up 0.97%. |
What Is Moving the Markets
| Here are the headlines moving the markets. | |
| Texas Will Not Reverse $16 Billion Power Overcharges During FreezeThe Public Utility Commission of Texas has rejected a proposal to retroactively reverse the market pricing for electricity that resulted in ERCOT overcharging the Texas electricity market by US$16 billion during the Texas Freeze in February. At a hearing on Friday, the PUC of Texas decided that it would not correct retroactively the overcharge with which the Electric Reliability Council of Texas, ERCOT, charged power companies in the state at $9,000 per megawatt hour (MWh) for a period of 32 hours during the worst of the winter storm in |
| Worlds Top Oil Trader: OPEC+ Controls The MarketThe unexpected OPEC+ move from last week and the subsequent oil price surge showed that the alliance is in control of the oil market, according to Vitol Group, the worlds largest independent oil trader. The market is telling us that OPEC+ have control, Mike Muller, the head of Vitols operations in Asia, said at the Daily Energy Markets Forum hosted by Gulf Intelligence on Sunday. Were going to get a stock-draw that is going to accelerate through the second quarter and thats why the market |
| Oil Falls After Spiking Due To Missile Attack On Saudi Tank FarmOil prices fell on Monday, hours after an early sharp price rise caused by a drone attack on Saudi oil infrastructure, per a Reuters report. Saudi Arabia later confirmed the attack. In the early hours of the morning, both Brent crude and West Texas Intermediate were up by close to 2 percent from Fridays close, following the news. But by 10:30 a.m. ET, the price of a Brent barrel sank back to $68.72, a loss of nearly 1% on the day. Yemen Houthis said they had fired 14 drones and eight ballistic missiles at oil facilities at the Saudi port |
| Aramcos Dividend Safe With Latest Oil Price RallyThe oil price rally will ensure Aramco is able to meet its $75-billion dividend payout, according to Bank of America. Bloomberg reports, citing the banks analysts, that any doubts there may have been about Aramcos ability to keep the annual $75-billion payments it promised investors when it listed, have now largely dissipated amid higher oil prices, which will likely boost Aramcos oil export revenues. Last year, some were worried Aramco would not be able to keep up with the payouts because of the collapse in oil prices. Aramco |
| Gas Imports Surge As China Sees Coldest Winter In DecadesNatural gas imports to China jumped by 17.4 percent on the year in the first two months of the year to 28.68 billion cubic meters thanks to the coldest winter in decades, according to Platts data. The harsh winter in Asia drove a huge spike in demand for natural gas in the region, which led to a surge in spot market LNG prices. Now, this demand is retreating, and prices are down to more normal levels. China is among the worlds top natural gas importers, along with Japan and South Korea, and therefore a prime target for gas exporters. PetroChina, |
| The Crisis Isn’t Over For Oil RefinersRefiners and integrated oil firms continue to struggle with low refining margins, as a part of global oil demandjet fuel consumptionis still enormously depressed by international travel restrictions. Margins for middle distillates, which include jet fuel, have improved since the worst effect of the pandemic last year. But the crisis in the airline industry and the pressure on refiners to curb jet fuel supply amid still very low demand could accelerate permanent closures of refineries geared to produce more middle distillates |
| CDC says people who are fully vaccinated against Covid can meet safely indoors without masksThe CDC on Monday released its first set of guidance for people who have been fully vaccinated against Covid-19. |
| 17.1 million viewers tuned in for Prince Harry and Meghan’s interview with OprahAround 17.1 million people tuned in for Oprah Winfrey’s interview with Prince Harry and Meghan Markle on CBS, according to preliminary Nielsen data. |
| CDC study finds roughly 78% of people hospitalized for Covid were overweight or obeseAn overwhelming majority of people who have been hospitalized, needed a ventilator or died from Covid-19 have been overweight or obese, the CDC said. |
| American Airlines plans $5 billion bond sale, $2.5 billion loan backed by frequent flyer program to pay back other debtAmerican Airlines is mortgaging its frequent flyer program to secure $5 billion in bonds and a $2.5 billion term loan to pay back a Treasury loan and other debt. |
| CEO of Newark hospital says demand for Covid vaccines is way up in NJ’s biggest city“The good news, though, is that hesitancy is moving in the right direction,” University Hospital CEO Dr. Shereef Elnahal told CNBC. |
| GameStop shares surge over 45% as retailer taps Chewy co-founder Ryan Cohen to lead e-commerce shiftShares of GameStop jumped more than 30% after the company announced it has tapped Chewy founder Ryan Cohen to lead its shift to e-commerce. |
| The UK’s National Health Service just approved a drug that costs nearly $2.5 million a doseThe innovative gene therapy called “Zolgensma” does not come cheap, with a reported list price of £1.79 million ($2.48 million) per dose. |
| Watch live: Biden Covid team holds briefing as U.S. warns states against rolling back restrictionsPresident Joe Biden’s Covid-19 response team is holding a news briefing Monday on the coronavirus pandemic. |
| NBA Commissioner Adam Silver supports new league that pays high schoolers $100,000The NBA boss said the Overtime league is good for basketball and mentioned NBA would pay attention. |
| SpaceX wants to connect its Starlink satellite internet network to moving vehiclesSpaceX wants to begin connecting moving vehicles ” from cars and trucks to jets and ships ” to its Starlink satellite internet network. |
| U.S. hits record daily Covid vaccinations but health officials warn against loosening restrictionsLast week, Arizona, Texas, Alabama, South Carolina, California and Mississippi all relaxed restrictions to varying degrees. |
| More restaurant jobs and the stimulus package foreshadow the industry’s coming recoveryRestaurants and bars gained 286,000 workers in February, the latest sign that the industry’s recovery is on the horizon after a long, cold winter. |
| Liquidity Tsunami Foiled: Why This Has Major Implications For MarketsLiquidity Tsunami Foiled: Why This Has Major Implications For Markets Exactly one month ago we explained that the US economy and capital markets were about to be flooded with a $1.1 trillion liquidity wave as the Treasury drew down the amount of cash held in the Treasury General Account which would plunge to just $800 billion by March 31, down a record $929BN from $1.729 trillion at Dec 31, 2020.
In other words as of early February, the Treasury expected the decline in the TGA cash balance this quarter – which is being spent to fund last December’s fiscal stimulus – to be the main driver of funding needs (for an intro primer on this topic, please see “U.S. Treasury’s cash drawdown – and why markets care”). |
| The Narrative Of Inflation Amid DepopulationThe Narrative Of Inflation Amid Depopulation Authored by Chris Hamilton via Econimica blog, Next to language, money is the most important medium through which modern society communicates. The Federal Reserve is responsible for signaling how fast this money should be created or destroyed via its federal funds interest rate. When demand is high and capacity/supply low, the Fed should ideally make rates low to support growth of loans to boost capacity/supply. When demand is low and capacity/supply high…the opposite. Instead, the Fed is doing the inverse…trying to focus on getting consumers to use more credit/debt (think record low mortgage rates) to create more demand and necessitate higher capacity (think homebuilders). In a ridiculously difficult chart to decipher below (so I’m told), I highlight the year over year change in working age population (yellow shaded area), year over year change in employees among them (grey shaded area), housing permits (blue line), and the 30 year mortgage rate (white line…driven by the Federal Reserve’s federal funds rate and MBS purchasing). The current situation of soaring permits against declining working age population and tanking employees among them…overridden by the speculative fervor created by record low mortgage rates is a case in point. |
| Goldman Now Sees Most Advanced Economies Reaching Herd Immunity In 3 MonthsGoldman Now Sees Most Advanced Economies Reaching Herd Immunity In 3 Months The drop in global new infections has stalled in the past month, in part because more contagious variants are now spreading widely. This pattern can be clearly observed in the US, where the seven-day average of new cases in the US is decreasing albeit at a slowing rate, around 60,000, while the seven day average in Europe remains at around 62,000. As BofA notes, the increasing spread of new, more contagious variants appears to be slowing the effect from restrictions and the vaccine roll-out. On a more positive note, however, hospitalizations and deaths continue to decline. While some of this improvement probably reflects lags, another reason proposed by Goldman is that the most vulnerable populations in advanced economies such as the US and UK are now largely protected. And as vaccine supply and eligibility broaden, the share of the population with at least some immunity is likely to rise rapidly in coming months. As shown in the chart below, vaccines administered around the globe continues to rise with BofA calculating that the US administered 15 million vaccines over the past week, increasing the total to 90.4 million; Europe administered 13 million doses this past week, for a total of 73.8m (and according to preliminary data from a study conducted at the University of Oxford, the Covid-19 vaccine developed by AstraZeneca/Oxford to be effective against the Brazilian variant of the virus) |
| Markets Not Holding Back On Rate Hike BetsMarkets Not Holding Back On Rate Hike Bets By Bloomberg commentator Laura Cooper Markets grappling with central bank reaction functions aren’t holding back on tightening bets. Rate hike expectations over the coming year have risen across major advanced economies as markets reprice growth prospects. Yet the upbeat growth narrative isn’t warranted everywhere — with policy makers likely to push back against premature tightening bets. The global reflation trade emanating from the U.S.-led fiscal impulse and vaccine rollouts is evident in money markets’ implied trajectories for policy tightening. Norway leads G-10 hiking bets followed by Canada and New Zealand. Except, policy makers here have maintained their dovish stance given uncertain economic prospects — it sets up for markets to reprice upbeat bets, with policy makers likely to push back in the week ahead.
The challenge facing policy makers is multi-fold. The European recovery is lagging on account of sluggish vaccine rollouts, extended lockdowns and a weake … |
| Fears for 5,000 UK steel jobs as lender collapsesThe main backer of the UK’s third-largest steelmaker has gone into administration. |
| Bank of England governor sees light at the end of the tunnelBut Andrew Bailey says the economy will need to adapt as people work and shop from home more often. |
| Deliveroo boss Will Shu: ‘I was never into start-ups’Will Shu’s comments come as the food delivery firm sets out flotation plans but reports another loss. |
| GameStop shares surge over 40% after Cohen tapped to lead e-commerce pivotThe stock surged more than 1,600% in January after a wave of buying forced large short-sellers betting against the company’s shares to unwind their positions, before paring most of those gains the following month. |
| Sorry folks, the SPAC party’s overEven with prices crashing, SPACs have so far been able to keep raising capital. However, their IPOs are no longer massively oversubscribed |
| Why should just boys enjoy the bull run? Females flocking to equities tooData available with a few broking firms suggests there has been a substantial rise in the number of women traders and investors in the last one year. |
| : COVID-19 relief bill will close a loophole that critics say created ‘a perverse incentive’ for for-profit collegesVeterans and borrower advocates have called on lawmakers to close the so-called 90/10 loophole for years. |
| Coronavirus Update: Health experts urge Americans not to drop their guard on COVID as death toll tops 525,000Health experts made a concerted effort over the weekend to highlight the risks posed by new variants of the coronavirus-borne illness COVID-19 and urged Americans not to drop their guard until the vaccine program is in full swing. |
| : Christian Louboutin valued at $3.8 billion as Italian dynasty takes stake in luxury shoemakerItaly’s billionaire Agnelli family says Paris-based shoe maker has growth potential in China. |
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