S&P 500 FINANCIALS INDEX
The Alerian MLP Index rose 1 to the 286s after yesterday's sell-off while the REIT index fell a fraction. Junk bond funds were fractionally higher. The VIX, volatility index, dropped 2 to the 33s on easing fears. The yield on the 10-year Treasury bond was 1 basis point lower to 3.29%, still very low relative to its yield over the last year.
Alerian MLP Index -- 2 weeks
Dow Jones REIT Index --- 2 weeks
VIX --- 2 weeks
10-Year Treasury Yld Index - 1 year
Oil is sloshing around the middle of its longer term 70-75 trading range while gold is seeing some profit taking. As long as gold holds the 1200 support level, gold bulls feel good.
|CLN10.NYM||...Crude Oil Jul 10||...72.95 ||... 0.37 |
|GCM10.CMX||...Gold Jun 10||...1,218.40 ||... 6.40 |
The index of pending home resales rose 6% in Apr following a revised 7.1% gain in Mar & above a projected gain of 5%. The gauge reached the highest level since Oct. Compared with Apr 2009, pending sales were up 25%. Pending home resales are considered a leading indicator because they track contract signings. Closings, which typically occur a month or 2 later, are tallied in the existing-home sales report.
Pending home sales - 1 year
No corp bonds were issued in the US yesterday, compared with $2.2B on the corresponding day last year. In Europe, €1.35B ($1.66B) was raised in 2 sales, compared with €6.5B last year. The global new issue market failed to revive after declining to only $70B in May (less than ½ of the Apr figure & the lowest since Aug 2003). Now the European Central Bank (ECB) forecasts €195B of bad debts will have to be written off by 2011. Bond traders are very cautious about the outlook for corp debts, not good for the high yield securities sectors.
Bond New Issues Shut as Bank Default Swaps Rise: Credit Markets
BP (BP) inched up 46¢ trying to get back to 33. Traders are attracted by the 9% yield & hopes for a lucrative takeout offer. Meanwhile the justice dept announced they are looking over BP's shoulders, trying to find wrongdoing. BP is an easy target to beat up on.
BP --- 2 weeks
General Motors reported May sales rose 17% on new product sales & a big gov fleet contract following a dismal May last year. Its 4 brands, Chevrolet, Buick, GMC & Cadillac, rose 32% (largely ongoing businesses). Other car companies should report later today.
Other than monthly sales reports from the car companies, there is not a lot going on. The pending home sales report does not represent a long term trend, at least not yet. The € settled to $1.22, flirting with its 4 year lows. Greece is selling stakes in its railroad & water companies, trying to put its financial house in order. But it will take a lot more than that. The bulls are hoping markets can maintain their positive momentum for the rest of the day.
Dow Jones Industrials --- 2 weeks
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