S&P 500 FINANCIALS INDEX
| Value | 216.70 | |
| Change | -1.75 (-0.8%) |
The MLP index is down another 6+ to the 363s. The 5 day chart for the index fund would show it in the low 36s, making for a very ugly week. The REIT index was down 1½ to the 243s. Junk bond funds were generally higher & Treasuries rose. The yield on the 10 year Treasury bond is at 5 month lows. Oil fell for a 4th day, the longest losing streak in 8 weeks, after US. jobless claims rose, bolstering concern that economic growth & fuel demand will decline. Gold & silver are having another bad day.
JPMorgan Chase Capital XVI (AMJ)
Treasury yields:
U.S. 3-month | 0.03% | |
U.S. 2-year | 0.59% | |
U.S. 10-year | 3.22% |
| CLM11.NYM | ...Crude Oil Jun 11 | ..........105.25 |  3.99 | (3.7%) |
| GCK11.CMX... | Gold May 11 | .............1,507.10 | 7.80 (0.5%) |
| ZIK11.CBT | ......Silver 5000 oz. May 11 | ...37.62 | 1.75 | (4.5%) |
Photo: Bloomberg
The number filing for jobless benefits rose to an 8-month high last week & productivity growth slowed in Q1, clouding the outlook for a struggling economy. Initial claims rose 43K to 474K, the highest since mid-Aug according to the Labor Dept. Claims were pushed up by factors ranging from spring break layoffs to the introduction of an emergency benefits program. Expectations had been for claims to fall to 410K. A 2nd report from the dept showed nonfarm productivity increased at a 1.6% annual rate, below a 2.9% pace in Q1 (& above expectations for 1%). The 4-week moving average increased 22K to 431K, the highest in 6 months. A Labor Dept official attributed the surprise surge in claims last week to spring break layoffs in NY, which added 25K & the start of an emergency benefits program in Oregon, which brought in new claimants, including some already on the regular programs. There were also additional claims from the auto sector& there could have been a small number of claims related to the tornadoes that struck parts of the country. But the increases are beyond what seasonal factors expected & that caused claims to go up. However, the step back in productivity was flagged by a sharp pull back in economic growth in Q1, it also suggested that businesses probably have little room to continue with their cost cutting strategies & may soon need to step up hiring. Overall this was dreary news & the markets treated it as such.
Jobless Claims in U.S. Unexpectedly Jump Due to Anomalies
Photo: Bloomberg
General Motors (GM) reported its highest quarterly profit in more than a decade, helped by demand for fuel-efficient cars & a big gain from selling its stake in its former auto parts business, as EPS was $1.77. GM thrived by selling small cars like the new Chevrolet Cruze, & efficient crossover vehicles such as the Chevrolet Equinox & GMC Terrain. Revenue rose 15% to $36.2B, driven by a 25% jump in US auto sales & a 10% gain in China, (its biggest market). GM's quarterly net income was more than triple the $865M it earned last year. The Treasury is still hoping profits will boosts the stock price so it can sell its stake & recoup more of the $50B bailout that saved GM. But GM fell 1.24 to $31.80. The latest results included a $1.6B gain from selling its stake in Delphi Automotive, its former parts division, as well as a $400M charge in Europe because of a change in accounting standards.
GM First-Quarter Net Income Triples as U.S. Sales Climb
General Motors Company (GM)
Dow is down 200 this week, the dismal chart is shown below. There will be a lot riding on the jobs report tomorrow morning. Expectations are fairly good, odds are reality will be disappointing for the markets. Some retail sales figures were reported & they were good although helped by a later than usual Easter season. MLPs are having a very tough time of it. This may be from getting caught up in the wave of selling in commodities which is hurting all markets.
Dow Industrials (INDU)
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