The chart below shows how the Dow has been trading sideways after its fall in Oct. All things considered, it has done an excellent job of holding above the 8K level. Of course, the flip is that it has not been able to move up. The interim ceiling of 9½K seems like a distant goal. Maybe that's asking too much given the ugly economic news that comes out every day.
Dow Jones Industrials --- 3 months
S&P 500 FINANCIALS INDEX jumped 3¾ to 162, good showing on a sluggish day. The only other noticeable change of the indices I watch closely is Dow Jones REIT Index rebounding with a 13½ point gain to 137½. As recently as Sep, it was at 270! REITs after being hammered unmercifully, offer extraordinary yields for the brave. They own hard assets, buildings & real estate, which should hold its value (at a minimum) over the long term.
Oil recovered from AM lows, but still lost ground ahead of he OPEC meeting next week:
| CLF09.NYM | ..Crude Oil Jan 09 | ....46.53 | .. 1.45......(3.0%) |
Nancy Pelosi has given a first glimpse at the spending package the Dems will come up with next month. This is extremely big money (on top of the bank bailout package) which will be financed with more debt. Currently the 90 T-bill yields .01% (annualized) while the 10 year Treasury yields 2.61%. These record low yields can not hold in the face of major increases in gov debt.
•Pelosi Says U.S. House's Economic-Stimulus Package May Reach $600 Billion
The markets are biting finger nails waiting for word on how the autos can be saved. Not much to do, just let the pols work their magic & hope for the best.
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