Markets pull back after early strength on retail sales

Nothing like favorable economic data to encourage stock buyers. But enthusiasm dimmed in the 2nd hour of trading. Dow is up 10, advancers ahead of decliners 3-2 & NAZ was down 11. Banks continue to have a tough time, the financial index is down fractionally remaining close to 190 (low end of its trading range).

S&P 500 FINANCIALS INDEX

Value 191.63

Change -0.18

% Change -0.1%

The Alerian MLP index is up pennies, still in the 273s, eking out another 2009 high. Many of the big name MLPs are back to their highs reached 2 years ago before the financial meltdown. The REIT index is also up a fraction continuing its sideways trading. Junk bond funds are higher, generally to new yearly highs. Treasuries sold off, the yield on the 10-year Treasury bond rose 9 basis points to 3.57% (following so-so auctions in the last 2 days).


AlerianMLP Index --- 2 weeks




Dow Jones REIT Index --- 2 weeks





Oil is still on defense, the bulls are hoping 70 will be able to hold. The chart shows that gold is slipping further off its record highs last week.

CLF10.NYM

...Crude Oil Jan 10

...70.17

... 0.37 .......(0.5%)

GCZ09.CMX

...Gold Dec 09

...1,111.80

... 13.90 .......(1.2%)

GLD (ETF) --- 2 weeks




Gold video that redirects to the Course landing url! Click Here

Find out what's inside Trend TV Click Here



Consumers stepped up spending in Nov raising hopes an economic recovery was starting to unfold. Retail sales increased 1.3% in Nov, the largest advance since Aug, after rising 1.1% in Oct. This was the 2nd straight monthly gain & beat market expectations of 0.7%. This data is the latest in a series showing the economy may expand at a brisker pace in Q4 than the 2.8% annual rate in Q3. Overall sales in Nov were helped by strong receipts from gasoline stations, increased purchases of motor vehicles & parts, building materials & electronic goods. Compared to Nov 2008, overall retail sales were up 1.9%, the first year-on-year gain since Aug 2008. In addition, the Reuters/University of Michigan Surveys of Consumers said its preliminary index of sentiment for Dec rose to 73.4, just below last year's high set in Sep & above 67.4 for Nov. Markets are feeling that the recovery looks to be more on track.

•U.S. Retail Sales Rise More Than Forecast in Sign Spending Gathering Speed


Today's rally is bringing the Dow very close to the highs set last week. The sales data suggests that the important holiday season may turn out to be better than the dreary forecasts already made. I'm surprised that the sales figures did not bring more buyers, maybe this PM.


Dow Jones Industrials --- 2 weeks