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Wealth Daily 20 January 2022

WEALTH DAILY 2022-01-20
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Shares on Wall Street declined again on Wed. The tech-heavy Nasdaq Composite fell into correction territory (dropped >10% from its Nov high).

The Dow Jones Industrial Average lost 339.82 pts, or 0.96%, to close at 35,028.65. The broader S&P 500 index fell 0.97%. The Nasdaq Composite retreated 1.15%. The small cap Russell 2000 dropped 1.6%.

There were some winners on Wed. Morgan Stanley (MS US, +1.83%) rose after raising its profitability targets and posting a surprise increase in equities-trading revenue, while Bank of America (BAC US, +0.39%) shares advanced as the bank saw loan growth return and held costs in check. Procter & Gamble (PG US, +3.36%) shares rose after raising its sales outlook.

The 10-year US Treasury note yield hit 1.90% and the German 10-year bund yield rose above 0% in the wee hours of the morning on Wed (NY time). It was the highest yield for both benchmark bonds since May 2019. The yields of both slid back as the day progress. The US 10-year finished down 0.88 basis points (bps) at 1.8646%, and the German 10-year yield is just below zero.

The ICE dollar index (DXY), which measures the strength of the greenback against a basket of currencies, fell 0.23% to 95.510.

The goldbugs got excited about the lower bond yields and weaker US dollar. The most actively traded US gold futures (Feb) contracts settled up $30.80, or 1.7%, at US$1,843.20/oz on a weaker US dollar. March silver, which is the most actively traded silver futures, rose 73.9 cents, or 3.1%, to end at US$24.231/oz.

Oil reached a fresh seven-year high. The front-month Brent and WTI futures closed up 93 cents at US$88.44/bbl and $1.53 at US$86.96/bbl respectively.

European equity markets finished higher on Wed. The UK FTSE gained 0.35%, France's CAC 40 rose 0.55%, while the German DAX advanced 0.24%.

South African researchers said booster shots with mRNA vaccines such as those made by Pfizer (PFE US, -1.05%) and BioNTech (BNTX US, -4.47%) failed to block omicron in a study of early breakthrough cases of the variant.

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