S&P 500 FINANCIALS INDEX
| Value | 221.83 | |
| Change | -4.95 (-2.2%) |
The Alerian MLP Index fell 2½, from its record yesterday, to the 379s, after doing quite well during the market run up in the last 3 months. The REIT index had a even bigger fall, down 7 to the 234s. Junk bond funds were generally lower while Treasuries did little. The yield on the 10 year Treasury was flat at 3.41%. After an initial rise in the last 3 months it has been flat while stocks were charging ahead..
Treasury yields:
| U.S. 3-month | 0.13% | |
| U.S. 2-year | 0.66% | |
| U.S. 10-year | 3.40% |
Alerian MLP Index --- 3 months
Dow Jones REIT Index --- 3 months
10-Year Treasury Yield Index --- 3 months
Oil surged to the highest level since Sep 2008 as Mideast turmoil threatened to spread from Libya to top OPEC producers such as Saudi Arabia & Iran. Gold went over $1433, setting a new record before profit taking. Charts for both contracts are shown below. Investors long oil & gold have done well.
| CLJ11.NYM | ...Crude Oil Apr 11... | 99.67... |  2.70 (2.8%) |
| GCH11.CMX | ...Gold Mar 11 | ....1,429.50 | ... 21.00 (1.5%) |
*** Gold Super Cycle ***
CLJ11 (oil contract) -- YTD
GCH11 (gold contract) -- YTD
Photo: Bloomberg
US auto sales rose more than 20% in Feb when the lure of discounts from automakers led by General Motors (GM) outweighed concerns about higher oil prices. This data puts the industry on track for its highest sales rate since Aug 2009 when the "cash for clunkers" credits spurred a short-lived boom. GM led the industry with a 46% sales gain, stoked by incentives that also led the industry at an estimated $3,700 per vehicle on average in Feb. But shares of Ford (F) & GM were lower amid mounting concerns about rising costs & after both carmakers posted disappointing quarterly earnings recently. GM fell 62¢, taking it below its offering price of $33, & Ford fell 37¢. Toyota (TM) had a 42% sales gain (off depressed results last year) & Nissan had a 32% increase after stepping up its incentive spending. Ford & Chrysler lagged, with sales gains of 14% & 13%&, respectively. The boom for GM & Nissan came on the back of stepped-up incentives for car buyers & dealers in a traditionally slow month for vehicle purchases & at a time when rising oil prices have emerged as a new threat to the industry. Trucks remained popular. Sales for Nissan's Pathfinder SUV & GM's Chevrolet Silverado pickup truck both rose 60%.
GM, Toyota February Sales Top Estimates in Recovery
General Motors -- YTD
Ford -- YTD
Prices at the pump are shooting up. The record was $4.11 set in Jul 2008 & we could see a new record in 2011.
| Regular | Mid | Premium | Diesel | 85 | **E85 MPG/BTU adjusted price | |
| Current Avg. | $3.375 | $3.477 | $3.624 | $3.729 | $2.848 | $3.747 |
| Yesterday Avg. | $3.368 | $3.468 | $3.613 | $3.713 | $2.840 | $3.737 |
| Week Ago Avg. | $3.171 | $3.304 | $3.436 | $3.564 | $2.750 | $3.620 |
| Month Ago Avg. | $3.099 | $3.292 | $3.409 | $3.432 | $2.664 | $3.506 |
| Year Ago Avg. | $2.705 | $2.873 | $2.976 | $2.875 | $2.330 | $3.066 |
Source: AAA
Bulls have finally run into headwinds in the last 3 weeks, 12K is a tough ceiling to break thru. The sharp rise in oil prices is unsettling for stocks. A good rule of thumb is when oil shoots up, stocks head south & this may be the first wave of repeating that relationship. Dow ran up 11% from 11K in 10 weeks, after upward revisions on growth rates for the US economic recovery in 2011. But oil prices could force those revisions to be revised again, this time downward. Markets have had spectacular runs over the last 2 years & are greatly overbought.
Dow Jones Industrials --- 3 months
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1 comment:
Now markets are going up and up
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