Movements in the Dow were mirrored in the S&P 500 FINANCIALS INDEX. It responded nicely to testimony. After being down, it rose 10 (10%) off the low but succumbed to late day selling & remains near records low levels set a few days ago. Bank of America (BAC) jumped sharply off its low early in the day, but pulled back ending up 43¢ at 5.16.
| Value 107.07 | Change 0.50 | % Change 0.5% |
The Alerian MLP Index rose 5 to 186, REITs & junk bond funds were down while VIX dropped another 1 to the 44s.
Oil had a big day, up on news that US gasoline inventories fell 3.4M barrels last week. Gold was quiet, slipping a couple dollars.
| CLJ09.NYM | ..Crude Oil Apr 09 | ..42.72 | .. 2.76......(6.9%) |
Chairman Bernanke gave soothing testimony before Congress. The Federal Reserve has an exit strategy, to get out of financing banks, once the economy recovers. However Congress may have different ideas, especially with regards to their meddling. The Treasury better defined its role in providing aid to banks.
Banks were given 6 months to raise money (public or private) if stress tests show they need additional capital. Meanwhile banks will be able to obtain further support under the $700 TARP program.
•U.S. Banks Will Get Six Months to Raise Capital After Balance-Sheet Tests
Treasury: Big Banks Can Get More Bailout Funds- AP
The eyes are now off DC. Banks will get back to the lending business (or whatever they do), car makers will try to straighten their businesses & retailers will carry on. It's difficult to see that the hearings accomplished very much. The sell-off in the last ½ hour (shown in the BigCharts widget in the right sidebar) must be discouraging to the bulls.
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