Banks have been having a profit taking week after reaching their high on Fri. The Financial Index rose almost 150% from its lows in Mar but has finally encountered significant resistance at just under 200. Today banks were down again.
S&P 500 FINANCIALS INDEX
| Value 185.16 | Change -1.82 | % Change -1.0% |
The MLP & REIT indices each fell 2½ on an otherwise undecided day. The Alerian MLP Index is down to the 233s nearing its peak back at the start of Jun. Junk bond funds were mixed & the yield on the 10 year Treasury bond slipped 8 basis point to just below 3.30% taking it back to the levels of late May. Risk averse is becoming a growing factor in the markets again, gold rose 24 to 979.
Alerian MLP Index --- 6 months
Dow Jones REIT Index --- 6 months
Three huge financial institutions which are now "troubled" (meaning the gov has become the largest stockholder) have had a wild month. When low priced stocks are this volatile that's not a good sign. When such big names but low priced stocks become high fliers & behave like this, that should give everybody a moment to pause & reflect.
Citigroup --- 1 month
AIG --- 1 month
Fannie Mae --- 1 month
During this last month of largely sideways movement, the S&P 500 has been hovering around the 1K line. It breached 1K, but not convincingly. Now that we are in Sep, toughest month of the year, it should make a convincing move thru the line but will have to decide whether that is to the upside or downside. During this time NAZ has been clinging to the 2K line with a similar trading pattern, up 50% from its lows but stalling out at 2K resistance. Last year Sep was when weak markets fell off the cliff. This year's movements should not be as dramatic, but could define trends for the rest of the year.
S&P 500 --- 1 month
NASDAQ --- 1 month
Dow Jones Industrials --- 6 months
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