Sun Microsystems --- 2 days
S&P 500 FINANCIALS INDEX continues its recovery from overly depressed levels a couple of weeks ago, reaching a 5 week high. Banks had another day of substantial gains. For example Citi (C) surged, taking it over 3. Speaking of strong charts, their 2 week chart shows that playing with fire can be rewarding. 5 is a near (& maybe far) term goal assuming it doesn't hit a major bump in the road.
| Value 126.01 | Change 11.56 | % Change 10.1% |
Citigroup --- 2 weeks
The Federal Reserve will buy $300B in Treasury bonds & acquire $750B in mortgage and agency debt to bolster the housing market and hasten the end of the recession. The 10 year Treasury bond surged on the news, reducing the yield from 3% yesterday to 2.53% today. This is the biggest drop in yield on the Treasury bond in 47 years. We're back to throwing money at problems which is what gave us AIG & the mess Congress is FIRST learning about today. They were the ones who had to rush out the stimulus package without reading what was in it.
•Fed to Buy $300 Billion of Treasuries, Keeps Interest-Rate Range Unchanged
•Treasuries Surge as Fed Expands Asset Purchases to Include Government Debt
Fed to buy $1 trillion in securities to soothe recession- AP
Junk bonds may have been helped by the rush to buy Treasuries. Barclays Capital High Yield Bond ETF (JNK) was up 28¢, a good gain for the junk bond index, as junk bond funds were strong. The Alerian MLP Index was up 2 & Dow Jones REIT Index gained 5 but remains in the trenches. The VIX was essentially even.
In a 3rd strong chart, Dow has recouped almost 1K from the recent lows. A nice run but bulls may be getting tired. Even a recovery from very depressed markets needs a rest, like seen in today's final hour.
Dow Jones Industrials -- 2 weeks
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