Markets tumble after a weak jobless report

Stocks plunged at the opening bell & those losses held. Dow is down 188, decliners ahead of advancers more than 6-1 & NAZ dropped 43 (Cisco was of little help). Banks are having another terrible day with the Financial Index breaking thru the important 190 support line to a 6 month low.

S&P 500 FINANCIALS INDEX

Value 188.13

Change -5.38

% Change -2.8%

MLPs are also having a horrible day. The Alerian MLP Index plunged over 8, taking the index below 290 (& down YTD). REITs sold off, down 3+. As stocks go, so go junk bonds although they have been absorbing less selling. Treasuries rose, the yield on the 10-year Treasury bond dropped 6 basis points to 3.64%.

Alerian MLP Iindex --- 2 weeks




Dow Jones REIT Index --- 2 weeks








Commodities have also been feeling the selling pressure with gold is having one of its worst days in months.

CLH10.NYM

...Crude Oil Mar 10

...74.68

... 2.30 .......(3.0%)

GCG10.CMX

...Gold Feb 10

...1,069.20

... 42.20 .......(3.8%)

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Photo: Bloomberg



The number of initial claims for jobless benefits rose unexpectedly last week, the 4th rise in the past 5 weeks. The Labor Dept said new claims for unemployment insurance rose by 8K to 480K (a drop to 460K was expected). The 4-week average rose for the 3rd straight week to 468K, the highest in the past 2 months. This depressing report suggests the Jan jobs report tomorrow will show a worse than expected unemployment rate ticking up to 10.1%. The number continuing to claim benefits was unchanged at 4.6M.

Initial Jobless Claims in U.S. Unexpectedly Climbed


Initial jobless claims - 1 year




Continuing claims - 1 year




Receiving extended benefits - 1 year





Orders at factories posted a big gain in Dec. The Commerce Dept reported orders rose 1% in Dec (double the 0.5% forecasted) the 8th increase in the past 9 months. The advance was led by big gains in orders for metals such as steel, aluminum & machinery. However, orders for transportation equipment as well as computers & electronics dipped slightly. Orders for durable goods & nondurable goods each rose 1%.

Factory Orders in U.S. Increased More Than Forecast


Factory orders - 1 year




Orders for durable goods - 1 year








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This is another dreary days for stock markets. Dow is near its lowest levels in 3 months. While it settled down after the initial drop off in the AM, the bears have taken control of the markets. Factory orders were good, but they are a lagging indicator. The jobless reports are current & just another reminder that this recession is not healing quickly. Cisco (CSCO), a Dow stock, had a good report last night but could only manage a 23¢ gain today. Dow is telling us it wants to test 10K.

Dow Jones Industrials --- 2 weeks