S&P 500 FINANCIALS INDEX
| Value 189.15 | Change -3.63 | % Change -1.9% |
The Alerian MLP Index dropped 6½ to the 273s (a drop of 5 is considered brutal). The REIT index fell 4½ to the 185s. Junk bond funds are down 1-3% (big by their standards). But Treasuries are hot again! The yield on the 10-year Treasury bond fell another 9 basis points to 3.14% & has a very ugly chart (below). Investors are willing to endure a stream of massive gov debts in the US against a confusing financial situation in Europe. Speaking of ugly charts, the VIX (fear index) chart for the last 2 months is also dreary. Today it's up 2, taking it over 40. Fears are running high.
Alerian MLP Index --- 2 weeks
Dow Jones REIT Index --- 2 weeks
10-Year Treasury Yield Index -1 year
VIX --- 2 months
Oil is selling off, joining the down stock markets on expectations of weaker economic global growth. This time it broke below 70, 65 becomes the next support level to watch out for. Gold is feeling selling pressure, but its quality as a haven for flight to safety money limits losses. It is still only 2-3% below its recent record highs!
| CLN10.NYM... | Crude Oil Jul 10 | ...68.06 | ... 2.15 .......(3.1%) |
| GCK10.CMX | ...Gold May 10 | ...1,193.80 | ... 4.20 .......(0.4%) |
Confidence in the economy rose in May for the 3rd straight month, fueled by growing optimism about future job prospects (which could be reversed because of sharp stock market declines). The Conference Board said that its Consumer Confidence Index rose to 63.3, up from a revised 57.7 reading in Apr (beating expectations of 59). The increase was boosted by consumers' outlook over the next 6 months which soared to 85.3 from 77.4, the highest seen since August 2007 (before the economy entered in a recession). The other component of the index, measuring how shoppers feel now about the economy, rose to 30.2 from 28.2. A reading above 90 indicates the economy is on solid footing, above 100 signals strong growth. The assessment is while confidence remains weak, it is gaining traction. However, this good news is being overwhelmed by the growing financial mess in Europe.
•U.S. Consumer Confidence Rises to Highest Level Since 2008 on Job Optimism
Consumer confidence index - 1 year
Photo: Bloomberg
The € fell to the lowest level since 2001 against the Japanese ¥ amid concern weakness in Spain’s savings banks signals an expansion of Europe’s sovereign debt crisis. Tensions escalating between the 2 Koreas over the sinking of a warship in Mar added to uncertainty over the €. The € declined to $1.22½ as the IMF said Spain has been too slow to strengthen its banking system. This feels like a panic with spreading economic problems!
Euro Falls on Concern Spain’s Bank Woes Signal Crisis Spreading
•Germany May Broaden Its Ban on Naked Short Selling to All Domestic Stocks
The important S&P 500 sunk to around 1050, its 6 month lows. 1100 had been considered an important support level & that went quickly. Dow is back below 10K again. We're always in uncharted waters but here it looks like support levels may much lower. The nasty oil spill in the Gulf keeps going from bad to worse. And Europe is an unfolding mess bringing more & more financial confusion.
Dow Jones Industrials --- 2 weeks
S&P 500 --- 6 months
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