Advanced Share Registry : Market News 18 Jan 2021

With the noise from America's political drama subdued (for now) and the country two days away from not having a president Trump, markets had little choice but face its number one enemy- Covid 19. The largest sell-off for the week ensued, though the previous days weren't challenging as Bears remain sleepy. From last Monday the Dow slid 0.9%, the Nasdaq Composite fell 1.5%, and the S&P 500 surrendered 1.5% for its largest retrace since the week ended Oct. 30. Wells Fargo Banks led losses, down 7.8% after revenues fell short of analysts' expectations. But Citigroup also fell 7.8% after posting earnings that beat analyst expectations so banks couldn't turn a trick. Treasury's also sold off, raising their yields as debt markets brace for some European style stimulus from Democrats entering the fray against covid. It won't take long for political noise to ramp up though as Trump's second impeachment gets underway after he leaves the Whitehouse.

With the planet at two-million pandemic deaths, the markets forceful vaccine-rollout-optimism.. slowed its roll. At least for the day, a realization emerged that the mean number of infections won't decline until these programs accelerate. Barely any of them are. Studies also haven't established if the vaccine will stop the spread of the virus itself. We only know that it protects those who receive it from contracting symptomatic or severe infections, but deaths and hospitalizations rates will decline. The gold standard of herd immunity must dodge many moving parts before 70% of a population is protected. Current predictions think that goal will arrive in July ...for some nations. Globally though, it's unlikely to happen this year. Meanwhile, China recorded its first Covid-19 death since April, but official statistics there are regarded with a 'fistful of salt'.

Energy shares rose as Bulls keep consumer stimulus packages firmly in view while the OPEC cartel tweaks its supply-side tsunami to keep short-sellers at bay. Exxon Mobil was the outlier, down 4.8% after regulatory probes emerged. Federal Reserve chairman Powell also offered his daily quote, assuring the world he also has its back and that raising rates 'is no time soon.' The Commerce Department revealed total retail receipts, excluding autos, decreased 0.7% in December from the prior month after a downwardly revised 1.4% drop in November. The ordinarily robust holiday shopping season only found coal in its stocking this year as the pandemic forced store closures and kept customers at home. Americas consumer sentiment tempered more than forecast in January, with the University of Michigan's index dropping to 79.2 from 80.7 in December. U.S. manufacturing productivity beat expectations again for an eighth straight month of gains. Factory output rose 0.9% from November and total industrial production, surged 1.6% for a five-month high.

Dow Jones	30814.26	-177.26	-0.6%
US S&P500	3768.25	-27.29	-0.7%
US Nasdaq	12998.50	-114.135	-0.9%
UK FTSE	6735.71	-66.25	-1.0%
German Dax	13787.73	-200.97	-1.4%
Gold Futures ($US/oz)	1829.90	-21.50	-1.2%
Spot Iron Ore ($US/t)	172.80	+1.35	+0.8%

Similarly, Europe's STOXX 600 index slid 1% from 11-month highs and -0.8% over the week as actual lockdown measures emerge as opposed to America's fear of them arriving. In November, the U.K. economy contracted by 2.6% while France reported December's CPI inflation at 0.0%. Italy could be undergoing another regular government change as Prime Minister Matteo Renzi pulls his support for the coalition. He was in good company though, as the Dutch government also resigned over childcare funds mismanagement, which drove thousands of families into financial hardship similar to our governments Robocall fiasco. Materials fell 3.1% there and could lead losses for us with our futures off 55 pre-open with local markets having to deal with U.S. markets closed tonight for Martin Luther King Jr Day.

Disclaimer:

Produced by Advanced Share registry based on information available at the time of publishing. We believe that the information in this report is correct and any opinions, conclusions or recommendations are reasonably held or made as at the time of its compilation, but no warranty is made as to accuracy, reliability or completeness. To the extent permitted by law, neither Advanced Share registry (ABN 14 127 175 946) nor any of its subsidiaries accept liability to any person for loss or damage arising from the use of this report. The report has been prepared without taking account of the objectives, financial situation or needs of any particular individual. For this reason, any individual should, before acting on the information in this report, consider the appropriateness of the information, having regard to the individual's objectives, financial situation and needs and, if necessary, seek appropriate professional advice. This report does not purport to be a complete statement or summary.