S&P 500 FINANCIALS INDEX has had a nice bounce off its extremely depressed lows (when Citi was at 1). The current value is back to mid Feb levels, but down sharply from the starting point this year (168).
| Value 114.45 | Change 7.06 | % Change 6.6% |
After a strong start this year, MLPs sold off in Feb but have staged a nice recovery in the last couple of weeks. This week, it's trying to make up its mind which way to go. Today it went up 2 to 190 (the low end of a trading range earlier in the year). I worry about unpleasant guidance & more possible distribution cuts next month. Kinder Morgan (KMP), after raising the distribution in Q1 said they expect that rate to hold for the rest of the year. This is the largest MLP, one that is very proud of its many increases. Conserving cash may grow in importance at MLPs.
Alerian MLP Index --- YTD
REITs continue to have a very rough year. In the last month, the Dow Jones REIT index has remained near 100, down sharply from the 270 area just 6 months ago. Correspondingly yields are at astronomical levels. But today it was up 7.78 to 103.70. Junk bond funds were higher & VIX dropped 3 to the 40s, near the lows for this year.
Oil had a good day, up 1.49 to 48.84. It wants to get to 50 but may have more resistance in the 50s.
Ben Bernanke of the Federal Reserve expects that they will buy much more debt, primarily mortgages, to give the banks more liquidity, in response to the deteriorating economy. Purchases may also include other forms of debt, including treasury & corporate bonds. The FED is scheduled to release a statement tomorrow afternoon.
•Bernanke May Need `Massive' Asset Purchases to Counter Deeper Contraction
Dow has had a nice run after being greatly oversold. On TV, everybody is asking if this is the real thing? Have we put in a bottom? Today Dow closed on its high representing a 3 week high. The bulls are in charge, at least for the time being.
Dow Jones Industrials --- 2 weeks
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