Thought For A Day
Archives of “April 2020” month
rssThis is going to be a desk fixture of mine for the next five years.
US dollar rises after Fed halves daily purchases for next week
Fed slows the pace of QE
The Fed announced it will buy $15B a day in bonds next week compared to $30B this week.
The response in the Treasury market has been swift with US 5-years yields rising to 0.35% from 0.33%.
That’s spilled over into the US dollar, which is making a small move higher across the board.
Here’s the Fed’s balance sheet:
China stays China
2020 could be the worst year for the UK economy since 1709. Yes, in more than 300 years!
May US oil futures finish down 8% at $18.27
June futures down 50 cents
The volume has rolled into the June contract but we’re going to be watching all of May, June and July closely in the coming days. The May contract expires on April 21 while the US is selling some of it June position to put it in July because it’s 25% of the open interest.
What’s notable about May is that those buyers will have to take delivery. At $18.27 in today’s settlement, there isn’t much appetite for that.
However in June it’s $25.08 and July at $29.43.
There are some unusual things going on in the oil market right now. It’s been quieter this week but that’s not going to last.
Here is a look at the June chart, which has fallen four days in a row:
European equity close: Solid gains turn the week green
Closing changes for the main European bourses:
- UK FTSE 100 +2.5%
- German DAX +2.9%
- Italy MIB +1.3%
- French CAC +3.1%
- Spain IBEX +1.6%
On the week:
- UK FTSE 100 +1.6%
- German DAX +2.6%
- Italy MIB -2.2%
- French CAC +1.0%
- Spain IBEX -1.2%
Q1 GDP from China: -6.8% y/y (expected -6.0%)
Q1 GDP from China was expected to be bad … and it is
-6.8% y/y, first negative quarter since 1992
- expected -6.0% y/y
- prior was +6.0%
Looking ahead, released at the same time was ‘activity data’ for March, separate post.
Coronavirus death toll by country – falling, plateauing
A graphic snippet from the FT is encouragement that global cases and deaths are on the downslope (still higher but at a slowing pace).
While the numbers on the vertical scale are not corrected for population a look at how the slope for each country is performing is a better guide – acting early paid dividends. In absolute terms you can see the human death toll inflicted on the US from the three months spent in denial and delay.
For a global tracker: See here for global coronavirus case data
Early data on Gilead coronavirus medicine remdesivir is very encouraging
Antiviral medicine remdesivir is being used to treat cov1 COVID-19 patients at a Chicago hospital,
A small study only, and note: The lack of a control arm in the study could make interpreting the results more challenging, so not leaping to conclusions:
- The University of Chicago Medicine recruited 125 people with Covid-19
- two Phase 3 clinical trials
- 113 had severe disease
- All the patients been treated with daily infusions of remdesivir
- “The best news is that most of our patients have already been discharged, which is great. We’ve only had two patients perish,” said Kathleen Mullane, the University of Chicago infectious disease specialist overseeing the remdesivir studies for the hospital.
Pic via Wikipedia:
