More negative macro economic news sent markets lower. Dow is down 109, decliners over advancers 3-1 & NAZ is down 10. Jobless claims rose slightly to 455K, worse than expected & a 6 year high. The 4 week moving average rose to 419½K, highest in 5 years. Wal-mart (WMT) reported same store sales were up 3% & Target (TGT) reported a decline of 1.2%, both below expectations. Wal-mart said, "With the end of the stimulus checks, we know consumers are spending more cautiously." Retail sales for July are looking grim & the important back to school sales season is not going well. Oil rose 1½ to over 120 on supply concerns, this time from a fire on a Turkish pipeline.
American International Group (AIG), largest insurance company in the world & a Dow stock, reported a much larger than expected loss last night, down almost 5. Today's decline is after the stock had fallen 50% YTD. They are heavily involved in credit default swaps, insurance policies to protect bondholders against defaults. AIG lost more than $25B pretax on credit default swaps in the last 9 months. Talk about not knowing what they are doing!!
The Alerian MLP index, remains near its 52 week lows, up fractionally to 262. REITs continue to pull back. Enough already with this dreary news.
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