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A new report coming out of Oxford University, in the quest to find cures for COVID-19 coronavirus, has brought forth something of a breakthrough: oral corticosteroid dexamethasone has proven efficacy in cutting the mortality rate of serious COVID-19 patients. First approved in 1961, dexamethasone is a generic anti-inflammatory drug already prescribed by physicians more than a million times per year, for various conditions.
Unlike Gilead’s (GILD - Free Report) remdesivir, which was proven effective at shortening the time patients are sick with the virus but not notably cutting fatality numbers, dexamethasone brought the death rate of thousands of patients on ventilators from 40% down to 28%. COVID-19 patients in need of oxygen saw dexamethasone reduce mortality from 25% to 20%.
Oxford, which has been testing lots of treatment options — including hydroxychloroquine, which had been dropped by the U.S. FDA just yesterday as a viable treatment for COVID-19 — seems to have hit on something significant with dexamethasone. Certainly the pre-markets think so: the Dow is now expected to open up around 900 points this morning.
Retail Sales for May might have something to do with this, as well — this report brought about the highest one-month jump since this economic data began, in 1992: +17.7%. This comes after a record-low (but upwardly revised) -14.7% in April, and is the first time in 4 months we’ve gotten Retail Sales numbers back into positive territory. It’s also more than twice as good as the expected +8.5%.
All the sub-headline numbers are terrific, too: taking out volatile monthly auto sales, we still see +12.4% growth, whereas -15.2% was the upwardly revised April figure. Ex-autos and gas, this also reaches +12.4%, up from -14.4% the previous month. The control number even came in at +11.0%. All in all, very solid retail sales illustrate a huge amount of pent-up demand after 3 months under quarantine.
The Trump administration has announced a new $1 trillion infrastructure plan to build roads, bridges and bring 5G and broadband access everywhere in the U.S., including rural America. While a positive news headline overall, another trillion dollars of spending would come as many members of Congress have a reduced appetite for deficit spending following trillions in economic stimulus. This itself comes after one of the biggest corporate tax cuts in history 2 1/2 years ago.
Industrial Production for May also swung to a positive in this morning’s report, up 1.4% from a downwardly revised — and all-time low in 101 years of Industrial Production numbers reported — -12.5% in April. This positive number is light of expectations, however: analysts had been looking for a number around +2.8%.
For Capacity Utilization, we also see an improvement, though a tad worse than expectations: 64.8%, following the all-time low April figure (also downwardly revised) 64.0%. This metric goes back to 1967. Expectations for headline Capacity Utilization were for 66.8% — still lower than we’ve seen in recent years, where the highest level we’d seen since the Great Recession was 79.6% in November of 2018.
The markets are off to the races, nevertheless. Talk about pent-up demand: nowhere is demand apparently more pent-up than in the U.S. stock market.
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A new report coming out of Oxford University, in the quest to find cures for COVID-19 coronavirus, has brought forth something of a breakthrough: oral corticosteroid dexamethasone has proven efficacy in cutting the mortality rate of serious COVID-19 patients. First approved in 1961, dexamethasone is a generic anti-inflammatory drug already prescribed by physicians more than a million times per year, for various conditions.
Unlike Gilead’s (GILD - Free Report) remdesivir, which was proven effective at shortening the time patients are sick with the virus but not notably cutting fatality numbers, dexamethasone brought the death rate of thousands of patients on ventilators from 40% down to 28%. COVID-19 patients in need of oxygen saw dexamethasone reduce mortality from 25% to 20%.
Oxford, which has been testing lots of treatment options — including hydroxychloroquine, which had been dropped by the U.S. FDA just yesterday as a viable treatment for COVID-19 — seems to have hit on something significant with dexamethasone. Certainly the pre-markets think so: the Dow is now expected to open up around 900 points this morning.
Retail Sales for May might have something to do with this, as well — this report brought about the highest one-month jump since this economic data began, in 1992: +17.7%. This comes after a record-low (but upwardly revised) -14.7% in April, and is the first time in 4 months we’ve gotten Retail Sales numbers back into positive territory. It’s also more than twice as good as the expected +8.5%.
All the sub-headline numbers are terrific, too: taking out volatile monthly auto sales, we still see +12.4% growth, whereas -15.2% was the upwardly revised April figure. Ex-autos and gas, this also reaches +12.4%, up from -14.4% the previous month. The control number even came in at +11.0%. All in all, very solid retail sales illustrate a huge amount of pent-up demand after 3 months under quarantine.
The Trump administration has announced a new $1 trillion infrastructure plan to build roads, bridges and bring 5G and broadband access everywhere in the U.S., including rural America. While a positive news headline overall, another trillion dollars of spending would come as many members of Congress have a reduced appetite for deficit spending following trillions in economic stimulus. This itself comes after one of the biggest corporate tax cuts in history 2 1/2 years ago.
Industrial Production for May also swung to a positive in this morning’s report, up 1.4% from a downwardly revised — and all-time low in 101 years of Industrial Production numbers reported — -12.5% in April. This positive number is light of expectations, however: analysts had been looking for a number around +2.8%.
For Capacity Utilization, we also see an improvement, though a tad worse than expectations: 64.8%, following the all-time low April figure (also downwardly revised) 64.0%. This metric goes back to 1967. Expectations for headline Capacity Utilization were for 66.8% — still lower than we’ve seen in recent years, where the highest level we’d seen since the Great Recession was 79.6% in November of 2018.
The markets are off to the races, nevertheless. Talk about pent-up demand: nowhere is demand apparently more pent-up than in the U.S. stock market.