Markets slip on Dubai debt uncertainty

Dow dropped 30 after a positive start, decliners ahead of advancers by 15% & NAZ was down 14. Banks were a little higher, but off their highs.


S&P 500 FINANCIALS INDEX

Value 193.66

Change 1.90

% Change 1.0%

The Alerian MLP Index is down pennies in the 267s, just off its yearly highs, but the Dow Jones REIT Index gained 1½ after its recent sell-off. Junk bond funds were mixed after a slightly up week. Treasuries slipped, the yield on the 10-year Treasury bond rose 2 basis points to 3.23%.

Alerian MLP Index --- 2 weeks




Dow Jones REIT Index --- 2 weeks





In the worldwide confusion about Dubai, oil & gold found a few buyers.

CLF10.NYM

...Crude Oil Jan 10

...76.71

... 0.66 .......(0.9%)

GCZ09.CMX

...Gold Dec 09

...1,175.70

... 1.50 .......(0.1%)

Heavily indebted Dubai World is not guaranteed by their gov, offering little direction to anxious investors. On the first day of trading since news of Dubai World's debt crunch became public, Dubai's main stock exchange dropped 7+% while the Abu Dhabi exchange fell 8+% -- the steepest falls in at least a year. Driving the financial avalanche was the announcement last Wed that conglomerate Dubai World would seek at least a 6 month reprieve on its $60B in debts. The obligations were amassed during years of a building spree that turned the desert emirate into the Middle Eastern version of Las Vegas & Wall Street. Uncertainty about what step the emirate would take next had cast a pall on world markets. However, Asian markets rebounded Monday after taking a tumble late last week while European markets were down slightly.

•Dubai Shares Sink, Abu Dhabi Index Drops Most in Eight Years on Debt Delay
•Dubai World's Debt Isn't Guaranteed by Government, Finance Official Says


Dubai Financial Market Index - 1 year




Abu Dhabi ADX Index - 1 year





The good news is that holiday shopping held steady through the Thanksgiving weekend. But economic worries about jobs were still apparent as shoppers mostly stuck to their lists & focused on practical items. The big worry is that consumers may not return until the final hours before Dec 25. According to preliminary figures released by ShopperTrak, a research firm that tracks more than 50K outlets, sales rose 0.5% over last year to $10.66B on Fri. That represented a 3% increase above last year. Online sales Thurs & Fri, however, rose 11% to $913M, according to Score, an Internet research firm. The National Retail Federation trade group said it's sticking to its forecast for holiday sales to decline 1% from last year.

•Holiday Sales Will Drop 1% in U.S. as Forecasters See `Disciplined' Buying



Holiday sales were mushy & the Dubai situation is cloudy. Stocks are back on defense. At least they held up pretty well all considered.

Dow Jones Industrials --- 2 weeks