Markets give up early gains

Markets failed again to hold onto early gains. Dow eked out a gain of 8, decliners were slightly ahead of advancers while NAZ was off 2. There was selling at lunchtime & markets weren't able to recover. Banks have been leading the way up in the recent rally & led the way down (as they did yesterday). The Financial Index finished off 2½ from its highs earlier in the day.


S&P 500 FINANCIALS INDEX

Value 215.55

Change 0.23

% Change 0.1%

MLPs are flattening out. All month, the Alerian MLP Index has been trying to crack the 300 ceiling but has failed to do that it a meaningful way. Today it slipped another ½ to the 296s. It began the year at 285, so it's showing a gain but that could disappear soon if more profit taking continues. The Dow Jones REIT Index fell 1 to 200, but is still up 10% YTD. Junk bond funds were flat to higher, offering less attractive high yields. Treasuries found buyers today. The yield on the 10-year Treasury bond fell 4 basis points to 3.86% remaining at high & worrisome levels.


Alerian MLP Index --- 2 weeks




Dow Jones REIT Index --- YTD





Traders gave up on oil. Selling took it below 80, but this move is not significant. Gold found some buyers to bring it back over 1100. Gold still has a bullish outlook, but as with stocks, there will be periods measured in weeks & even months when little happens.

CLK10.NYM

..Crude Oil May 10

..79.95

.. 0.62 ......(0.8%)

GCH10.CMX

..Gold Mar 10

..1,104.20

.. 11.50 ......(1.1%)

Johnson & Johnson (JNJ) & Merck (MRK) are the 2 pharmacy Dow stocks which are still Dividend Aristocrats. They have been held back this year by their traditional defensive nature. Investors are more interested in accepting risk with the hopes of greater rewards. Value players might give them a 2nd look.


Johnson & Johnson --- YTD




Merck --- YTD






AT&T (T), Dow stock, is taking a $1B non-cash charge in Q1 because of the added costs for the health care overhaul. Already AK Steel (AKS), Caterpillar (CAT & a Dow stock), Deere (DE) & Valero Energy (VLO) announced similar charges needed because this law will raise their expenses.

•AT&T Sees First-Quarter Charge of $1 Billion on U.S. Health-Care Overhaul



Dow tried hard to push on to 11K this week, but bulls weren't able to take it there. A rescue package for Greece helped today, but there wasn't conviction behind the buying. More stories about the dreary housing market hurt. Companies taking charges for costs related to the health care bill is an unexpected headache. The threat of higher interest rates is another kick in the head housing doesn't need (not to mention the markets in general). Dow managed a 1% gain for the week & is up 5% in Mar. Next week the bulls will show if they are still in charge of the stock markets.

Dow Jones Industrials --- YTD




Nasdaq --- YTD

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