Stocks struggle to advance

Popular averages rebounded a little after initial selling. Dow was off 33, decliners over advancers almost 2-1 & NAZ was down 10. Buying in the PM can still take the Dow to another yearly high. After getting a lot of attention, banks are selling off. The Financial Index can't get away from sideways pattern near 200 which has lasted for 3 months.

S&P 500 FINANCIALS INDEX

Value 197.49

Change -1.59

% Change -0.8%

The Alerian MLP Index rose pennies in the 263s, still aiming for a 2009 high into the 266s. But the Dow Jones REIT Index dropped 2 & junk bond funds were mixed. The yield on the 10-year Treasury bond fell 2 basis points to 3.34%.


Alerian MLP Index --- 2 weeks



Dow Jones REIT Index --- 2 weeks





Oil keeps waffling in the 75-80 range while gold charges higher to new records.

CLF10.NYM

...Crude Oil Jan 10

...76.15

1.41 .......(1.8%)

GCX09.CMX

...Gold Nov 09

...1,169.80

... 5.50 ........(0.5%)

Banks earned $2.8B in Q3, but loan balances plummeted & the fund that insures their deposits was $8.2B in the red. Souring loans continued to hurt bank balance sheets, but they were buoyed by higher operating revenues & a revived market for securities according to the FDIC. The number of banks on the FDIC's "problem list" rose to 552 in Q3 from 416 in Q2, the highest level in 16 years. 50 banks failed during the qtr, the largest number since 1990. Bank failures this year through 2013 are expected to cost the fund $100B, mostly in 2009 & 2010. This dreary assessment of bank results helps explains why the Financial Index has not risen in 3 months.

‘Problem’ Banks at 16-Year High in Third Quarter, FDIC Says



Confidence in the economy improved slightly in Nov but shoppers remain gloomy heading into the holiday shopping season amid a weak job market. The Conference Board said that its Consumer Confidence Index edged up to 49.5 from a revised reading of 48.7 in Oct. The index had hit a historic low of 25.3 in Feb. A reading above 90 means the economy is on solid footing, above 100 signals strong growth. Depressed spending is likely to persist for several years amid stubbornly high unemployment. Shoppers' assessment of the job market remains weak. Those claiming jobs are "hard to get" increased to 49.8% from 49.4%, while those claiming jobs are "plentiful" decreased to 3.2% from 3.5%.

Consumer Confidence in U.S. Unexpectedly Increased

Jobs are plentiful (%) - 1 year

Jobs are hard to get (%) - 1 year





This is another sleepy day on low volume during a holiday week. Retailers are getting ready for the all important holiday selling season in Q4 (when a large portion if not all yearly profits are earned at retailers). They are worried, but it's just another major worry for investors. Sluggishness in banking stocks is negatively impacting stock markets today.

Dow Jones Industrials --- 2 weeks