Thursday, March 25, 2010

Dow tops 10,900

Dow is up 91 at the session's highs, taking it above 10,900 for a new 2010 high. Advancers are ahead up decliners 2-1 & NAZ is up 28. Banks continue VERY strong with the Financial Index reaching another 2010 high. A change of 5 for this index is eye popping!


% Change

MLPs have been on a rocky road after the sell-off on last week's witching Fri. Today the Alerian MLP Index is down a fraction to the 298s. But the Dow Jones REIT Index is up 2+ to the 203s. Strong stock markets bring more demand for junk bonds. Many funds are at prices (with correspondingly low yields) that haven't been seen in a few years). Meanwhile the yield on the 10-year Treasury bond is up another 2 basis points to 3.85% & taking it nearer the important 4% level. The yield on the 2 year Treasury is up to 1.07%, another high & troubling number.

Alerian MLP Index --- 2 weeks

Dow Jones REIT Index --- 2 weeks

Oil & gas a barely up, not worth a mention unless you are a day trader.

CLK10.NYM...Crude Oil May 10...81.03 ...Up 0.52


Photo: Bloomberg

New unemployment claims fell more than expected last week as layoffs eased & hiring slowly recovered. The Labor Dept said first-time claims for jobless benefits dropped 14K to 442K, below estimates of 450K. But most of the drop resulted from a change in the calculations made in seasonally adjusted data. Excluding the effect of those adjustments, claims would have fallen by only 4K. The 4-week average of claims dropped 11K to 453K, the lowest since 2008 when the financial crisis intensified. While the news is encouraging, companies are still not rehiring in a major way, keeping the important jobless rate near 10%.

Jobless Claims in U.S. Decreased Last Week to 442,000

Weekly unemployment claims - 1 year

Photo: Bloomberg

Best Buy (BBY) beat estimates for profits & sales in Q4 & forecast stronger-than-expected earnings for 2010. The key holiday quarter was helped by demand for notebook computers, mobile phones & flat-screen televisions. BBY has benefited from investing in customer service, such as promoting Twelpforce to answer queries on Twitter & providing its Geek Squad repair assistance to shoppers. EPS rose to $1.82 in Q4 ended Feb 27, up from $1.35 in the prior year. Net revenue rose 12% to $16.55B. For FY2011, it expects to earn $3.45-$3.60 a share on revenue of $52-$53B. The stock was up 2.49 to 43.67.

Best Buy Surges as Profit Tops Analysts’ Estimates on TVs

Best Buy --- 2 years

The Treasury will unveil a trading plan next month for the sale of its 27% in Citigroup (C). The plan will give the gov a schedule for selling shares with the aim of eliminating any concerns that the sales are based on non-public information. Citi was up 18¢ to $4.33 & looks like it wants to shoot for its yearly high above 5.

U.S. Treasury Said to Have Plan for Citigroup Shares

Citigroup --- 1 year

Bulls have taken control of the markets as risk is being ignored in the pursuit of capital & trading gains. On the fringe, Treasuries are being sold to buy more junk bonds with dwindling yields. The European Union wants to work out some sort of bailout package for Greece which encourages the bulls. Dow should take out 11K, probably by tomorrow at the latest. Just not sure how long this euphoria can last.

Dow Jones Industrials --- 2 weeks

Find out what's inside Trend TV
Click Here

No comments: