S&P 500 FINANCIALS INDEX
| Value | 218.56 | |
| Change | -4.10 (-1.8%) |
The MLP index fell 2¼ to the 369s & the REIT index dropped a very big 4+ to the 228s (backing off an important interim high). Junk bond funds were pretty much even but Treasuries found buyers on the uncertainties in Egypt. The yield on the 10 year Treasury bond dropped 6 basis points. Buying interest came from its safe haven qualities.
Treasury yields:
| U.S. 3-month | 0.14% | |
| U.S. 2-year | 0.55% | |
| U.S. 10-year | 3.33% |
Alerian MLP Index --- YTD
Dow Jones REIT Index --- YTD
10-Year Treasury Yield Index --- YTD
Oil surged the most since in 14 months as unrest in Egypt raised concern that protests would spread to major oil-producing parts of the Middle East. Crude gained 4.2% after a day of clashes between police & protesters demanding an end to Egyptian President Hosni Mubarak’s 30-year regime. Bloomberg TV had a phone line with an Egyptian stuck in his hotel room in Cairo, the situation is tense. Of course, intl tensions brought out buyers for gold, the ultimate safe haven asset.
| CLH11.NYM | ...Crude Oil Mar 11 | ...89.23 | ..... 3.59 | (4.2%) |
| GCG11.CMX | ...Gold Feb 11 | ......1,336.70 | .... 18.30 | (1.4%) |
$$ Gold Super Cycle $$
Photo: Yahoo.com
Amazon (AMZN) was hurt by intense competition from Wal-Mart (WMT), a Dow stock, & other discounters that kept a lid on many prices. The world's biggest online retailer's shares sank $13.31 to the $171s after it said its holiday-season revenue uncharacteristically fell short of expectations & it offered a disappointing profit outlook for Q1. Under pressure from WMT, AMZN has lowered its prices & scrambled to match the surprise offer in Q4 of free shipping on tens of thousands of items. CEO Jeff Bezos noted 2 important milestones: The company cracked $10B in quarterly revenue for the first time, & it sold more electronic books for its hot-selling Kindle reader than it did paperback books. AMZN EPS of 91¢ beat expectations of 88¢ & came in ahead of last year's 85¢. But analysts were expecting an even bigger jump in revenue than the 36% Amazon reported. AMZN forecast $13B while the company took in $12.95B. AMZN Q1 guidance of $9.1-9.9B in revenue was in line with projections of $9.32B. But the company warned that operating profit could decline as much as 34% from Q1 2010. Its huge decline today undermines the credibility of tech related stocks to keep delivering higher earnings.
Amazon shares slip on revenue miss, profit outlookAP
Amazon --- 2 years
I wrote 2 articles this week for SeekingAlpha (on the 2 largest MLPS & Citi) that received an excellent reception:
http://seekingalpha.com/article/249141-kinder-morgan-and-enterprise-products-start-the-new-year-right
http://seekingalpha.com/article/248461-citigroup-where-there-is-risk-there-is-potential-for-rewards
Dow was coming off a 29 month high. Expectation were for it to easily climb over 12K. But that failed. Unrest in Egypt (which affects the entire Mideast) & a dismal report from AMZ were some of the major causes of the selling. Dow had been trying for a 9th consecutive week of gains, an usually long run. By any definition, markets are vastly overbought. However, the bulls will take comfort that Dow is up 250 in Jan. It's interesting that Dow ran into an important resistance (12K) after the FOMC meeting when the low rates were reaffirmed. This connection needs to be examined.
Dow Jones Industrials --- YTD
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