Dow drifts

Dow is up 29 on a nothing special kind of day. Advancers are 3-2 over decliners & NAZ was even. The Financial Index shows the banks are just bumbling along.

S&P 500 FINANCIALS INDEX

Value 195.47

Change -0.86

% Change -0.4%

MLPs are having a good day. The Alerian MLP Index is up 2 to the 268s bringing it close to overhead resistance at 270. If it breaks thru that ceiling in a meaningful way, it could attract more buyers. The REIT index was off 1+ after an excellent week. It deserves a rest. Junk bond funds were higher. Some have more than doubled from their depressed levels earlier this year, an amazing run. The yield on the 10-year Treasury bond fell 4 basis points to 3.44%. The chart below shows the yield has had a very volatile couple of weeks.


Alerian MLP Index --- 2 weeks




Dow Jones REIT Index --- 2 weeks




10-Year Treasury Yld Index - 2 weeks






Commodities are taking the thoughts very hard about the FED unwinding its positions. This has led to a rising dollar. Oil went below its 75 floor signaling its on defense again. Gold is in its own world. It's down 75 (equivalent to a barrel of oil) in a couple of days, but that can happen with any high flyer. Fundamentals for gold remain strong. Those who are cautious but interested in dabbling may be more interested after the sell-off. Over the short term, markets have told us that gold, in particular, is very much tied to the strength or weakness of the dollar. It now takes almost 90 ¥ (vs 87 a few days ago) to buy a dollar & the € has dropped 3¢ to $1.48, both dramatic moves in such a short time.

CLF10.NYM

...Crude Oil Jan 10

...74.46

... 1.01 .......(1.3%)

GCZ09.CMX

...Gold Dec 09

...1,143.60

... 25.20 .......(2.2%)

Dubai World may unload assets to raise cash. Dubai Finance Department Director did not say which pieces of the company are for sale. However, the assets would be Dubai World's alone -- underscoring the gov's position that it is not responsible for debts racked up by a company it created & backed.

•Dubai World May Sell Domestic, Foreign Assets to Repay Debt, Official Says



The chart shows Dow has been plodding along in the last 2 weeks. The Dubai scare has receded, now the major worries relate to the strengthening dollar. For the time being there is no hint the FED will ease soon as unemployment drones on at unacceptable levels. But the easy money policy will come to an end & those thoughts are keeping buyers away.

Dow Jones Industrials --- 2 weeks