S&P 500 FINANCIALS INDEX gave back some the recent gains in profit taking (for those who purchased last week). Citi dropped 48¢ to 2.6o, plans to take it up to 5 are on hold.
| Value 115.88 | Change -10.13 | % Change -8.0% |
The Alerian MLP Index was up 1¾ while REITs were weak. The VIX popped 3.62, bringing it to the 43s.
Oil & all commodities were very strong resulting from the weak dollar. The $ was very weak, for example the ¥ which had been at 99 to the dollar a few days ago has shot up to the 94s. The thinking behind weak dollar & strong commodities is that the gov is printing money, making money flee to stronger currencies & hard assets. Oil topped 50 & gold had one of its best days in history, the bulls are talking about 1000 this week!
| CLJ09.NYM | ..Crude Oil Apr 09 | ..51.29 | ... 3.15 .......(6.5%) |
| ZGH09.CBT | Gold 100 oz. Mar 09 | ..959.10 | 69.60 ..(7.8%) |
Federal Reserve's easing money has brought mortgage rates down. Last week, the 30 year fixed rate mortgage dropped below 5%. With the Federal Reserve's latest announcement it's expected to drop to 4½%, the lowest since WWII.
•U.S. Mortgage Rates May Fall to Lowest Since World War II on Fed Purchases
General Electric (GE) at a conference today said their finance unit would be profitable in Q1 & for the full year. They envision earnings up to $5B at GE Capital in 2009. GE stock has been battered this year primarily over fears about GE Capital & its prospects for having a dismal time in the credit crisis.
Further thoughts about the FED's moves to buy bonds (some call that printing money) made traders pause today. In addition, markets are coming off their best 7 day streak in modern times adding to selling pressure. The proposal to tax AIG bonus money at 90% is one of those ideas that's not going to make a big difference at the big picture level. If the gov recaptures all money paid, it wouldn't qualify as a drop in the bucket when running gov deficits over $1T.
Dow Jones Industrials -- 2 weeks
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