Dow gains for another 2009 high

Markets closed higher in a very good week, following 2 off weeks. Dow was up 78, good enough for another 2009 high, advancers 25% ahead of decliners & NAZ gained 15. Dow was up over 370 this week. Banks led the way up as has been the case for much of the rally in 2009. But the Financial Index is still just below the high set last month.

S&P 500 FINANCIALS INDEX

Value 205.10

Change 1.65

% Change 0.8%

MLPs had a modest gain, but that was good enough to carry the Index to 255.89 (another 2009 high). REITs & junk bond funds also rose, but not dramatically.

Alerian MLP Index --- 1 month




Dow Jones REIT Index --- 1 month




The big news was the plunge in Treasuries. The yield on the 10-year Treasury bond shot up 13 basis points to 3.38%, an eye popping gain. This corresponded to a plunge (over $1 or $10 per $1000 bond) in its bond price. Selling in Treasuries with other maturities was similar. Ben Bernanke, head of the Federal Reserve, said the FED is ready to tighten monetary policy once the economic outlook improves. With signs that an economic recovery has begun, speculation swirls about how quickly they will start to unwind (sell) their positions in bonds. There are worries it may come sooner (early in 2010 vs prior thoughts that it would come later in the year). When they sell bonds, rates will rise sending a shudder in all investors.

Treasuries Fall, Head for Weekly Drop, on Bernanke Rate Outlook

................................................price...............decline

10-Year

3.625

08/15/2019

101-31+ / 3.39

-1-05½ / .138

10-Year Treasury Yield Index - 1 week





Oil was down pennies in the 71s & gold fell 9 to 1046. Gold was hurt but the stronger dollar today, especially against the Japanese ¥.


Markets had a very good week, following 2 sluggish ones. The increases were good enough for the Dow to eke out a new 2009 high. But NAZ, having an even better year, fell short of a new yearly record close. Next week many more earnings reports are coming.

Dow Jones Industrials --- 1 month




NASDAQ --- 1 month