29 October 2020

1) One major factor in the spread of Covid-19 virus, is the portability of societies, the degree which people are moving about and interacting with each other with ease. This is a major cause of the spread of infectious disease. Now with the surge of coronavirus in Europe, Germany and France, they are planning to restrict movement of people for at least a month, coming close to the stringent lockdowns of the spring as European leaders seek to rein in a resurgent pandemic outbreak. Spain, Italy, the U.K., Greece and Portugal reported record numbers of new cases on Wednesday. Asia, Singapore and Hong Kong could start a planned ‘travel bubble’ as soon as next month. This also means restrictions of travel for migrant workers, which in turn means restricting their ability to make money, where much is sent back home to families to support their subsistence.

2) Boeing Aircraft company, a major manufacture of airliners, will cut 7,000 more jobs amid the pandemic, almost doubling its planned job cuts. The coronavirus pandemic has prolonged the grounding of Boeing’s 737 Max jet, thus dimming prospects for financial recovery. Executives are abandoning their forecast that Boeing will stop burning cash next year and so they are now forced to eliminate an additional 7,000 jobs. That will bring the expected losses from layoffs, retirements and attrition to 30,000 people, or 19% of the pre-pandemic workforce, by the end of 2021.

3) Taiwan’s microcircuit manufacture United Microelectronics Corp. has pledged its assistance to the U.S. in a high-profile trade-secrets prosecution of Chinese chipmaker Fujian Jinhua Integrated Circuit Co. UMC has pleaded guilty Wednesday in federal court as part of a deal with U.S. prosecutors. Prosecutors agreed to drop serious charges of economic espionage and conspiracy for theft of proprietary information from Idaho-based Micron Technology Inc. UMC instead admitted to trade-secret theft and agreed to pay a $60 million dollar fine. Prosecutors haven’t publicly detailed the cooperation they are seeking from UMC against Fujian

4) Stock market closings for – 28 OCT 20:
Dow 26,519.95 down 943.24
Nasdaq 11,004.87 down 426.48
S&P 500 3,271.03 down 119.65

10 Year Yield: unchanged at 0.78%

Oil: down at $37.69

15 October 2020

1) The much feared Diablo winds, along with its low humidity, will bring critical fire weather to Northern California through Friday, increasing the risks of wild fires. There are widespread red flag fire warnings for Northen California above San Francisco because of extremely dry, gusty, north to northeast winds which will bring critical fire conditions. With the relative humidity down into the single digits and teens, winds could reach about 45 mph, with gust up to 55 mph, both conditions very conducive to rapidly spread wild fires. The Diablo winds are much like the Santa Ana winds so familiar to Southern Californians.
2) Boeing’s troubles continue with no new orders for jets and more 737 MAX cancellations as the companies crisis continues. There were more orders for the 373 MAX canceled in September with delivery of only 11 total aircraft to customers, which is less than half the number from the same month a year ago. Furthermore, the quality flaws on the 787 Dreamliner continue to hamper efforts to develop an alternative cash cow to the 737 MAX. The major source of Boeing’s problems is the coronavirus pandemic, which continues to hurt the demand for jets, for Boeing as well as its rival Airbus, and this is a factor that neither aircraft manufacture has any control over.
3) The prices for crude oil are rising with the dollar’s decline, which in turn is boosting appeal of commodities priced in dollars. There are signs of oil demand increasing in Asia, which is helping lift the overall outlook for oil consumption. The company Rogsheng Petrochemical of Singapore is buying up oil futures to run its expanded refinery operation in Zhejiang this quarter. The outlook for refineries output remain precarious, with refining margins severely depressed for this time of the year. Refineries typically need a spread of more than $10 a barrel to make it profitable to process crude oil.
4) Stock market closings for – 14 OCT 20:
Dow 28,514.00 down 165.81
Nasdaq 11,768.73 down 95.17
S&P 500 3,488.67 down 23.26
10 Year Yield: unchanged at 0.72%
Oil: up at $41.22