S&P 500 FINANCIALS INDEX is giving back some of the recent gains in this confusing market.
| Value 122.07 | Change -3.94 | % Change -3.7% |
Alerian MLP Index is up 2 to 194. REITs are down & junk bonds funds have modest gains.
Oil shot up on the FED's announcement about buying bonds. The $ is very weak & gold is strong, its flight to safety quality is attracting buyers.
| CLJ09.NYM | ...Crude Oil Apr 09 | ...51.35 | ... 3.21 .......(6.7%) |
| ZGH09.CBT | ..Gold 100 oz. Mar 09 | ..933.00 | .. 43.50 ....(4.9%) |
The weekly data on unemployment continues grim. Last week, 646K filed for unemployment (down slightly from the prior week). The number drawing unemployment surged 185K to almost 5½M (as of the prior week), the highest number on record. The economy keeps bleeding jobs with no end in sight.
FedEx (FDX) reported dismal earnings. Profits plunged 75% on lower sales, the first sales decline in a decade. They reduced earnings guidance in what is considered a difficult year to forecast. FDX feels the pulse of the economy (US & around the world), making their earnings announcement more important than most other companies.
•FedEx Profit Slumps, Sales Drop for First Time in Decade; Job Cuts Planned
Citigroup (C) is trying to fight back from the gloom which brought the stock down to 1. They will have a reverse stock split to boost the share price (stockholders then will be able to see a $50 price, whatever, on far fewer shares). They are also proposing a stock swap for preferred stockholders to swap for common at a $3.25 value. The idea is to boost common equity which has been draining fast. Also, Citi will need $10M to renovate a floor for top executive officers in their main building at 399 Park Ave. Sounds like they are getting inspiration about spending from gov spending programs. In all fairness, they are trying to do something for the economy. Citi will sell $3B in bonds backed by credit card payments under the new gov program TALF.
Citigroup Said to Commit $10 Million for New Executive Suite
•Citigroup Plans to Sell $3 Billion in Credit-Card-Backed Bonds Under TALF
The AIG hearings are a big joke. Congress screwed up by passing rescue packages & spending programs in a hurry & now seems shocked to find out that haste makes waste. They need to understand the meanings of sloppy & careless. Punishing a few AIG guys sends a bad signal that Congress will second guess everything bailout companies are doing. Much worse is the $180B (whatever) used to save AIG is being ignored. They know how to watch the mice while ignoring the mountains! I'm not sure how rushed & sloppy behavior by Congress is supposed to increase confidence for investors so they will buy more stock.
Confusing markets plus the strongest 7 day period since the depression can keep stocks under pressure.
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