Tuesday, February 8, 2011

Markets extend February gains

Stock averages began the day with gains & kept climbing, closing near the highs.  Dow rose 71 (making it 7 consecutive days with a total gain of 400+), advancers ahead of decliners a more modest 4-3 & NAZ added 13.  Banks keep rising.  The chart below for the Financial Index shows it's up almost 50 in just over 4 months (a time when the Federal Reserve has been buying Treasuries under the QE2 program).


Value228.44One-Year Chart for S&P 500 FINANCIALS INDEX (S5FINL:IND)
Change   1.51  (0.7%)

The MLP index fell 1¾ to just under 370 but the REIT index was up a fraction to 234, good enough for another new high over the last 2½ years.  Junk bond funds were higher, nearing their highs in Q4.

Alerian MLP Index   ---   2 months

Dow Jones REIT Index   ---   2 months

10-Year Treasury Yield Index   ---   2 months

Oil prices fell after China increased key interest rates to help slow inflation in its growing economy, raising concerns that the country's thirst for oil would diminish.  Gold futures climbed to a 2-week high on demand for a hedge against rising consumer prices.

CLH11.NYM...Crude Oil Mar 11...86.94 .....Down 0.54  (0.6%)

GCG11.CMX...Gold Feb 11.......1,363.50 ...Up 15.90  (1.2%)

$ Gold Super Cycle $ Click Here

Treasuries fell after the sale of a $32B in 3-year debt drew the lowest demand in the category since May 2007. US securities extended declines before auctions of $24B in 10-year notes tomorrow & $16B in 30-year bonds the following day.  Yields on 10-year bonds rose 10 basis points to 3.73%, the most since Apr 30. 2-year notes rose 9 basis points to 0.85%, the highest since Jun 3. The general expectation by this market is that rates will gradually shift higher.  A quickening US recovery means policy makers need to take a serious look at their commitment to the $600B monetary-stimulus program (QE2).

Treasuries Drop on Reduced Foreign Central Bank Bid at 3-Year Note Auction

Treasury yields:

U.S. 3-month
U.S. 2-year
U.S. 10-year

Apple (AAPL), with the 2nd largest market cap in the world, continues to fly.  The stock gained another 3+  to the 355s, yet another record high.  Buyers are excited about the talk of selling 50M tablets this year & AAPL will share in the growth.  Global shipments of tablets are expected to rise 12 fold, from 17M in 2010 to over 200M by 2015.  Of course, when a stock heads straight for the heavens, it could be setting itself up for a disappointment along the way.  For the time being, stockholders are happy & not disturbed with uncertainties in the future.

Apple   ---   2 years

Bulls continue in charge, taking the Dow back to levels last seen since the middle of Jun 2008.  More earnings are coming & the markets will likely greet them with joy irrespective of what they say.  MLPs have stumbled a bit this year, as expected.  The index is up 6 at the same time the Dow is up over 600 with pretty much gains every day.  Good times are fun, but they can't last forever. 

Dow Jones Industrials   ---   2 months

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1 comment:

Option Trading, Trade Options, Trade Stocks said...

Thank you for giving information about U.S. market,but in Indian economy both NIFTY and SENSEX are going down this February.