Stocks vacillate

Markets want to go higher & extend their winning streak to 6 days. It's going to be tough despite favorable economic reports. Dow is down 26, advancers ahead of decliners 3-2 & NAZ slipped 5. Banks were down fractionally but the index is only 2 points from its 2009 high.

S&P 500 FINANCIALS INDEX

Value 196.06

Change -0.65

% Change -0.3%

The Alerian MLP Idex shot up 2 to the 245s, a nice move up after pulling back 2 months ago. The Dow Jones REIT index was down pennies, remaining a couple points below its 2009 high. Junk bond funds keep rising to levels last seen almost 12 months ago. Meanwhile Treasuries are strong at the same time risk is welcome by investors. The yield on the 10-year Treasury bond is down 5 basis points to 3.29%, levels last seen over 4 months ago.

Alerian MLP Index --- 2 months




Dow Jones REIT Index --- 2 months




10-Year Treasury Yld Index - 6 months






Oil prices were flat at 72, but gold went over 1K (18 month high) & this time that price may stick. Inflation fears are taking the dollar down & gold up, gains for gold are expected to continue. The question becomes, when will that affect the stock market?

GCU09.CMX

...Gold Sep 09

...1,010.00

... 14.60 .......(1.5%)

The Reuters/University of Michigan index of consumer sentiment increased to 70.2 in Sep from 65.7 in Aug (the index was forecast at 67.5). The measure of current conditions rose to 71.8 from 66.6 & the index of consumer expectations for six months from now increased to 69.2 from 65 in Aug. Consumers are growing more upbeat after suffering the biggest destruction of wealth on record from a slump in stocks & home prices. But they may still be wary of increasing spending & they make up 70% of the economy, instead focusing on building savings & paying down debt. Once the gov stimulus ends there may be nothing holding up the economy so it will just sink again.

.•U.S. Consumer Sentiment Rises More Than Forecast as Pace of Job Cuts Slows



FedEx (FDX) raised its Q1 earnings forecast, based on better-than-expected international shipments & cost-cutting. FDX expects earnings of 58¢ per share for Q1 ended Aug 31 down 53% from last year but well above the company's previous prediction of 30-45¢ per share. Analysts had been looking for 44¢. The shares climbed 4.98 (7%) to 77.64. FDX added it expects to earn 65-95¢ per share for Q2 reflecting a continued modest recovery in the global economy (analysts expect 70¢). The company's performance is seen as a key indicator of overall economic health.

•FedEx Climbs After Package-Shipping Company Says Profit Beat Its Forecast

FedEx --- 1 year

The 2 month chart for the Dow is very strong. 2 months ago it had just reversed 8K from ceiling to a floor. Since then, it shot up another almost 20%, a remarkable run.

Dow Jones Industrials --- 2 months