S&P 500 FINANCIALS INDEX
| Value 193.60 | Change 0.68 | % Change 0.4% |
MLPs are lumbering along, today down .68 to the 268s. The graph points out that the 270 ceiling may be tough to crack, at least for awhile. This is where the index was prior to its plunge last Sep. However REITs are having a good day, the index is up 4 taking it within 4 points of its yearly high. Junk bond funds are doing well. Risk is being rewarded as Treasuries sold off big. The yield on the 10-year Treasury bond rose 10 basis points to 3.48%.
Alerian MLP Index --- 2 weeks
Dow Jones REIT Index --- 2 weeks
Oil rebounded off the 75 floor which has held for several weeks. Gold is having its worst day in some time. Bargainer hunters may start nibbling.
| CLF10.NYM | ...Crude Oil Jan 10 | ...77.17 | ... 0.71 .......(0.9%) |
| GCZ09.CMX | ...Gold Dec 09 | ...1,184.20 | ... 33.20 .......(2.7%) |
The unemployment rate unexpectedly fell to "only" 10% in Nov, employers cut the smallest number of jobs since the recession began. However the respite may be temporary. Many expect the unemployment rate to climb into next year as the economy struggles to generate enough jobs for the 15.4M out of work. The economy shed 11K jobs last month, an improvement from the revised total of 111K in Oct (& much better than the 130K expected). If part-time workers who want full time jobs & laid off workers who have given up looking for work are included, the so-called underemployment rate also fell, to 17.2% from 17.5% in Oct. Also the average work week rose to 33.2 hours, from a record low of 33 hours. The increase in hours worked means employees are earning more income which could help increase consumer spending. Temporary help services added 52K jobs, the 4th straight increase. The news from the job report was about as good as could be hoped for but there is still a long way to go before we see significant reductions in the unemployment rate.
•Jobless Rate in U.S. Unexpectedly Drops to 10% as Payrolls Fall by 11,000
Unemployment rate (%) - 1 year
Underemployment rate (%) - 1 year
Orders to factories rose 0.6% in Oct, the 6th gain in the past 7 months, much better than the flat reading that had been expected. A jump in demand for commercial aircraft & petroleum products led the gain. Orders for durable goods, items expected to last three years, rose 0.6%, unchanged from a preliminary estimate last week. Orders for nondurable goods rose 1.6%, aided by gains in demand for petroleum, chemicals, plastics & food.
Orders to U.S. Factories Climb for Sixth Time in Seven Months
Factory orders (% change) - 1 year
The global rebound should produce div increases. It is estimated that 1 in 6 companies in the S&P 500 will increase their divs. An added benefit for those paying qualified divs is they are taxed at a lower rate that ordinary income. AT&T (T), Wal-Mart (WMT) & Progress Energy (PGN) are forecasted to lead those increasing divs. Dividend Aristocrats, such as WMT, may be getting more attention going forward, many have been left behind in in the year's rally.
Dividend Payments May Rise as Recovery Frees Cash
The very favorable jobs report was just what the markets needed. But the reversal by the markets is discouraging. PM trading should be unusually interesting.
Dow Jones Industrials --- 2 weeks
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