S&P 500 FINANCIALS INDEX
MLPs started the year like they were shot out of a canon. The Alerian MLP Index rose over 5, shooting for 291. Its 3 year chart is shown below to review how much it has recovered against its 342 all time high. The REIT index had a more tepid gain (up only 1) reflecting doubts about real estate. Junk bond funds are having another excellent day bringing many yields down to 10%. Even Treasuries are rallying, the yield on the 10-year Treasury bond fell 4 basis points to 3.82% (but remaining in high territory).
|10-Year||3.375||11/15/2019||96-12 / 3.82|
Alerian MLP Index --- 3 years
Dow Jones REIT Index --- 1 year
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Oil cracked the important 80 ceiling on the cold weather snap (remember global warming?) in the northeast. Commodities were strong, gold is trying to establish 1100 as a floor from which to rebound.
|CLG10.NYM||...Crude Oil Feb 10||...81.46 ||... 2.10 |
|GCF10.CMX||...Gold Jan 10||...1,120.20 ||... 25.00 |
The Institute for Supply Management said its manufacturing index was 55.9 in Dec vs 53.6 in Nov (a reading above 50 indicates growth) for the 5th straight month of expansion & the highest reading in 4 years. But a separate report on construction spending sounded a more cautionary note as construction activity fell in Nov for a 7th straight month, the 0.6% was bigger than the 0.4% decline predicted. Other measures of manufacturing around the world also showed growth. China's manufacturing sector expanded in Dec at its fastest rate in 20 months. In Europe, a similar survey in the 16 countries that use the Euro rose to a 21-month high & a manufacturing index for Britain rose to a 25-month high.
Manufacturing in U.S. Expanded More Than Forecast
Factory Index - 1 year
Berkshire Hathaway (BRK.A) had its worst performance in a decade (pretty much flat) when compared to the big gains by the Dow. Generally "value stocks" performed only so-so at a time when risk was embraced & rewarded. BRK felt that effect.
•Warren Buffett Delivers Worst Stock Performance Against S&P 500 in Decade
Berkshire Hathaway --- 1 year
The new year started with bulls taking charge. The January Effect (fresh money coming into markets in a new year) is taking hold. Last year, risk averse was the main theme but now risk is being rewarded. Risky investments are getting a lot of attention as demonstrated by the strength in high yield sectors.
Dow Jones Industrials --- 1 year
Nasdaq --- 1 year