Dow jumps 225, banks & energies led the way

Stocks started higher & kept rising all day, finishing at their highs with buying into the close. Dow gained 225, advancers over decliners better than 4-1 & NAZ was up 58. Banks had nice gains, they have been leading the rallies & declines this year. The Financial Index could make another assault on 200 which it has already crossed many times (both ways) in recent times.


S&P 500 FINANCIALS INDEX

Value 199.19

Change 5.88

% Change 3.0%

MLPs rebounded, the index was up 5½ to the 291s & recovered much of yesterday's loss. The REIT index added 4¼ to the 199s. But junk bond funds slipped in this rally. The VIX plunged 5¼ to 30, risk fears eased quite a bit. As expected, Treasuries sold off. The yield on the 10-year Treasury bond rose 4 basis points 3.33%.

Alerian MLP Index --- 1 month




Dow Jones REIT Index -- 1 month




VIX --- 1 month




10-Year Treasury Yld Index - 1 month





Oil is benefiting from the stronger stock markets suggesting a recovery which will need more oil. Gold sold off responding to lower fears shown at the VIX.

CLN10.NYM

..Crude Oil Jul 10

..73.31

.. 0.73 ......(1.0%)

GCM10.CMX

..Gold Jun 10

..1,220.50

.. 4.30 ......(0.4%)

Gold Super Cycle!!
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Dem senators (Wyden from OR & Schumer from NY) are telling BP (BP) to stop divs until the mess is cleaned up. Divs cost BP over $10B in cash & it will awkward to pay but this also gives a glimpse of how Congress wants to assign blame & punish somebody else. It would be nice if they spent more time policing the SEC which has 33 lawyers (earning $100-200+K) spending time in their offices watching porn. 8 resigned (under pressure) to avoid further embarrassment, the others are still on the payroll! Taxpayers could have been better served if they spent more time watching Madoff & other bad guys. In the meantime, BP's latest attempt to end the leak hit a snag today. But BP gained 1.14 to 37.66 in the up market.

•BP Should Reconsider Shareholder Dividend Amid Cleanup, U.S. Senators Say


BP --- 1 month






Oils snapped back nicely today. The 2 big ones in the Dow: Exxon Mobil (XOM & also a Dividend Aristocrat) & Chevron (CVX), were each more than 1½, but they're coming off depressed levels near 3-4 year lows.

Exxon Mobil --- 1 month




Chevron --- 1 month





Detroit automakers Ford (F), General Motors & Chrysler had double-digit sales gains over last May. However, May 2009 was a terrible time when GM was headed into bankruptcy protection & Chrysler was already there. Foreign car makers also saw 20+% sales gains, again not saying all that much considering how dreary May was last year. Today's markets were anticipating good news from the jobs report on Fri. Expectations are for a gain in jobs of (maybe) ½M. Good news, if it comes, but the details will tell how many are from private employers versus federal (which is always hiring) jobs. The € rose a little, settling at 1.22½. Dow had a nice gain, but a longer view shown in the chart below shows it's been bumping along a little above 10K for a couple of weeks. MLPs & REITs did well today, but junk bonds (stocks with high yields) disappointed after a dreary May.

Dow Jones Industrials -- 1 month

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