Lower markets on profit taking

Stocks rested & there was selling at the close. Dow dropped 155, decliners over advancers 5-2 but NAZ slipped 7. Banks gave up some of recent gains. Major banks, like Bank of America (BAC), Citigroup (C), JPMorgan (JPM) & Wells Fargo (WFC), were down 5-7%. When the financial index drops 10+, that's a significant delcine.

S&P 500 FINANCIALS INDEX

Value 163.85

Change -11.99

% Change -6.8%

The MLP Index dropped 1.57 after going up 50 in 2+ months. The REIT Index has also had a 50 point pop (down 6.26 today), but its movement has been choppier & is giving more indication that it has maxxed out in the 230s. Junk bond funds were mixed today despite a 2% gain for the BARCLAY HYB ETF.


Alerian MLP Index --- 3 months




Dow Jones REIT Index --- 3 months




The Treasury bonds deserves a little more attention. Today it rose, the yield on the 10 year Treasury fell 11 basis points to 3.18%. Money flowed out of stocks into bonds & perhaps the Federal Reserve was buying again to drive down rates.


10 year Treasury bond yield --- 3 months





Moody's assigned a AAA rating for the new debt being sold by Microsoft (MSFT), reaffirming the strong financial credentials of MSFT. MSFT was down pennies. Recently this elite rank had been reduced to a mere dozen. Since then, AIG, Pfizer & General Electric have seen their ratings reduced. Earning a AAA rating is quite an achievement, especially in today's brutal credit markets.

Moody's assigns 'Aaa' to Microsoft notes offering


Dissatisfaction with Citigroup directors caused 20% of the shares to be withheld on voting for directors at the annual meeting. Those shareholders have a right to be in an ugly mood after seeing the stock plunge below 4.

• Citi investors withhold votes from some directors- Reuters

Stocks have had an enormous run in just a few months. The chart below shows the S&P 500 (which has outperformed the Dow) was trading at 7 month high levels. Even for them, a 260 gain needs time to pull back & readjust.


S&P 500 ---- 6 months