Archives of “October 2020” month

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Japan govmt planning to approve COVID-19 treatment drug Avigan in November

  
  Analysis

The Japanese government is planning an unprecedentedly short screening period of three weeks once Fujifilm Toyama Chemical Co submits a new drug application.

  • That submission is expected in mid-October
  • Which would thus lead to approval of Avigan as a coronavirus treatment in November
The news comes via the Japanese media, citing unnamed sources.
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There will, of course, be concerns about the scrutiny efficacy and safety of the drug with such a fast-track process. Keep in mind also that back in May then PM  Abe said approval for Avigan was expected that month.
The Japanese government is planning an unprecedentedly short screening period of three weeks once Fujifilm Toyama Chemical Co submits a new drug application.
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Meanwhile there is a lot of focus on how Trump is faring with his infection. He has posted a video on Twitter saying he is starting to feel good, will be back soon, and what have you. Gosssip is swirling about how believable it is. Interpretations seem to split along political lines, unsurprisingly. A lot of heat, not much light.

White House doctor says Trump fever-free, off supplemental oxygen

  
  Analysis

White House doctor seems carefully upbeat, from his statement:

  • Trump not yet out of the weeds but the team remains cautiously optimistic
  • Trump continues to do well, “having made substantial progress since diagnosis”
  • Trump remains fever free and off supplemental oxygen
Sean Conley, the White House physician, with the update. Let’s hope Trump stays on the improve.
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As a side note, it looks like someone has been reading the works of Robert Cialdini. He discussed the relevance of white coats in his book, Influence:
White House doctor seems carefully upbeat, from his statement:
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Scroll down the page for the chronological updates on Trump’s recovery so far this weekend.

Major indices close lower as the market digests Pres. Trump’s Covid diagnosis and no new stimulus deal

  
Analysis, US Market

Major indices still close higher for the week

The major US stock indices are closing the day lower as traders digest Pres. Trump’s Covid diagnosis and no new stimulus deal from the Dems and GOP.

Although the NASDAQ fell over 2% today, the index still closed higher for the 2nd week in a row. The S&P index and Dow industrial average also closed higher for the week. The Dow and S&P snapped a 4-week losing streak.  The stocks snapped a 2 day winning streak today. The Dow is down 434 points at the low.
The final numbers are showing:
  • S&P index fell -32.31 points or -0.96% to 3348.49. It’s high price reached 3369.10. It’s low price extended to 3323.69
  • NASDAQ index fell -251.49 points or -2.22% to 11075.03. It’s high price reached 11244.87. It’s low price extended to 11033.69
  • Dow industrial average fell -134.15 points or -0.48% to 27682.75. It’s high price reached 27861.43. It’s low price extended to 27382.94
For the week the Dow industrial led the way to the upside:
  • S&P index rose by 1.52%
  • NASDAQ index rose by 1.48%
  • Dow industrial average rose by 1.87%

CFTC commitments of traders: Traders reverse speculative positions in GBP to a modest short.

  
Analysis, Forex

CFTC commitments of traders data for the week ending September 29, 2020

  • EUR long 188K vs 191K long last week. Longs trimmed by 3K
  • GBP short 13K vs 3k long last week. Shorts increased by 16K
  • JPY long 25K vs 30K long last week. Longs trimmed by 5K
  • CHF long 13K vs 16K long last week. Longs trimmed by 3K
  • AUD long 9K vs 16K long last week. Longs trimmed by 7K
  • NZD long 3K vs 5K long last week. Longs trimmed by 2K
  • CAD short 19k vs 19K short last week. Unchanged
  • prior report

Highlights:

  • The GBP position swung around from being long to short with a that 16K change in position .
  • The EUR shorts remain the overwhelming largest speculative position at 188K.
  • The NZD is the smallest net speculative position at long 3K
  • The CAD and GBP are the only short positions (long USD positions).

Which way do the weekend risks skew?

  
  Analysis

The pros and cons

The pros and cons
Coronavirus in the White House has hurt risk trades today but they’ve mostly recovered. Ultimately, the odds of Trump dying are low and other than that, it’s tough for a read on how it will affect the election.
I’m coming around to the idea that a blue wave is coming but this could cause a shake-up. Maybe Trump gets some sympathy or maybe it hurts him in some other way.
There’s always the chance he takes a turn for the worse on the weekend or makes a rapid recovery. Does that shift the Presidential race?
The bottom line is that on that front, there are so many unknowns. In general, the more uncertainty you add, the more it begs for safety so on net, it’s negative.
The other big uncertainty is US fiscal stimulus. There are more calls today and neither side wants to appears as if it’s walking away so that might all be a mirage. Still, there’s a chance of a deal on the weekend and that overshadows any virus news. There’s also the chance that it fails completely, but I’d say the odds right now are about 20% of a deal so it swings both ways.
This is what Pelosi said today that boosted stocks from the lows:

“This kind of changes the dynamic because here they see the reality of what we have been saying all along — this is a vicious virus,” Pelosi said on MSNBC.

“I’m optimistic, I’m always optimistic,” she said, “We always have to find a path, that is our responsibility to do so, and I believe that we will.”

Is that a throwaway line to emphasize a point? A sign she’s willing to move? Or a sign she thinks Republicans should move?

Ultimately, I don’t think there’s going to be a rush on either side heading into the weekend but there’s still time for more headlines.
In a sign that a deal could be emerging, Mnuchin told at least one Republican senator in a phone call on Thursday night that the agreement with Pelosi would include a substantial amount of money for state and local governments, a provision numerous conservative Republican senators have strongly resisted, according to one person granted anonymity to share details of the private conversation. The call was interpreted as designed to prepare conservatives for the White House to give more on state and local aid than they had previously expected.

VP Pence replacing Trump on call with governors

  
  Analysis

The President, The Election. The SCOTUS

Some additional political headlines over the last few minutes:
  • Apparently Pres. Trump is not able to participate in a call on coronavirus with Senior citizens today. VP Pence will stand in for the President. Given the administrations reluctance to be transparent at times (i.e., Bloomberg scooped the Hope Hicks Covid news and despite “rapid testing” the Pres. did not tweet he had Covid until nearly 1 AM), the hints will be scrutinized as to how serious or not the President’s condition is
  • Texas has been sued over plans to limit ballot drop boxes for election. The governor citing security, said that drop boxes for mailing votes would be limited to one per county.  Texas has some big counties.  Many feel that this is a voter suppression ploy
  • Democrats urge GOP to put health first, not rush SCOTUS.  Finding common ground on stimulus is elusive, but Sen. McConnell already said that the SCOTUS procedure would continue as planned.  Nice try, but I would put the chance of the GOP to suddenly forgetting about the SCOTUS nomination to be 0.0%. If they could, they would vote right now without any confirmation hearings.
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