Thursday, July 15, 2010

Last hour buying limits market losses

Stocks were under water all day until the last hour (after the Senate passed the financial reform legislation) when they rose. Dow slipped only 7 (but ended its 7 day winning streak), advancers and decliners were even after decliners had been leading advancers all day & NAZ was off a smidgen (call it even). Buyers returned to bank stocks late in the day. The Financial Index, had been down 4, but finished near break break-even.


Value198.60One-Year Chart for S&P 500 FINANCIALS INDEX (S5FINL:IND)
Change-0.19 (-0.1%)

The Alerian MLP Index advanced 1 to 224½, another 3 year high, & has its sights on what would be a new record at 343. The REIT index fell a fraction to the 197s. Junk bond funds were little changed. VIX was flat in the 24s. Treasuries rose taking the yield on the 10-year Treasury bonds down 7 basis points to 2.98% & only a few basis points above its lows a few weeks ago. The € held firm at a shade under $1.29 & up more than 10¢ from recent lows.

Alerian MLP Index -- 2 months

Dow Jones REIT Index -- 2 months

VIX -- 2 months

10 Year Treausry Yld MLP Index -- 2 months

Oil slipped & gold had a modest rise. Gold bulls are glad to see it's able to hold above 1200.

CLQ10.NYM..Crude Oil Aug 10..76.62 ..Down 0.42

GCN10.CMX..Gold Jul 10..1,209.60..Up 2.80

$$ Gold Super Cycle $$
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The Senate voted 60-39 for new regulations on Wall Street & new protections for consumers. This law, with 2,300 pages, will give the gov new powers to break up companies that threaten the economy, create a new agency to guard consumers in their financial transactions & shine a light into shadow financial markets that escaped the oversight of regulators. Bank stocks have held up well & rose after the bill was passed.

Senate Passes Wall Street Overhaul, Sending It to Obama

BP (BP) is expected to reach an agreement shortly to sell assets to Apache (APA) for $10-11B, including half its stake in Alaska’s Prudhoe Bay. APA is progressing in raising $6-7B which has helped speed negotiations. BP said it will concentrate on selling assets outside regions with the most lucrative production growth. Prudhoe Bay’s output, once greater than 1½M barrels a day, averaged 235K barrels this month. APA, the largest independent US oil company, has bought mature fields from BP in the past. BP rose 2.74 (8%) while APA fell 70¢. Late day buyers bid up both stocks.

BP Nears $11 Billion Asset Sale to Apache

BP --- 2 years

Apache --- 2 years

Buyers were discouraged by the economic data, especially the manufacturing reports, early in the day. But that didn't last, stocks rallied in the last hour. Dow had been down 100 & was almost able to finish in the black, but still in a 9 month trading range. The only major news during the day was the new financial regulation being approved. Tomorrow 2 big banks report in & will probably have mixed kind of results like JPMorgan (JPM) had today. Meanwhile MLPs are red-hot. It seems like nothing can stop their freight engine pulling the index to a new record high (at a time when Dow needs a 40% rise to make that same claim)!

Dow Jones Industrials -- 1 year

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