Dow was up 6, decliners ahead of advancers 5-4 & NAZ added 1. Banks stocks were soft.
The MLP index fell 5 to the the 348s while the REIT index fell 2 to the 222s. The MLP index remains near 350, its low in May representing a 10% pullback from the record high at 390. Junk bond funds inched higher & Treasuries were a tad higher. Oil slipped, trimming its 4th straight weekly gain & longest winning streak since Jul, on concern that European plans to solve the region’s debt crisis may founder, threatening economic growth. Gold rose the first time in 3 days on renewed concern that Europe’s debt crisis will threaten economies, boosting demand for a safe haven investment.
Photo: Bloomberg
Consumers were slightly more confident in the economy in Sep, but also increasingly worried about the future. The Thomson Reuters/University of Michigan's consumer sentiment index inched up to 57.8 in Sep from 55.7 in Aug. The Aug reading was the lowest since Nov 2008. But consumers are more pessimistic about their future prospects. An index tracking consumer expectations fell to its lowest level since May 1980! Americans are more optimistic about present conditions as that index rose to 74.5 from 68.7. Consumer confidence plunged in Aug, after the gov said the economy barely grew in the H1, lawmakers fought over raising the nation's borrowing limit & S&P downgraded long-term U.S. debt. Not much encouragement in this report.
Michigan Consumer Sentiment Index Rises
Austria's finance minister is criticizing Treasury Sec Tim Geithner for lecturing the eurozone on its crisis strategy but refusing to listen to the currency union's suggestions. Maria Fekter says Geithner in "very dramatic terms" urged the eurozone to get a grip on its debt crisis to avoid destabilizing the global financial system, but then immediately ruled out a tax on financial transactions, which some euro countries see as a way of sharing the burden of expensive bailouts. She said "I would have expected that, if he explains the world to us, that he would also listen to what we want to explain to the Americans." Greece's intl rescue partners will delay until Oct their decision on paying out the next rouind of bailout loans needed to keep Greece from bankruptcy. The announcement was yet another example of Europe's halting effort over almost 2 years to solve its crisis over too much gov debt in some countries. Geithner had joined the meeting, a first for the US finance chief, in a sign of how the US is getting increasingly concerned over the global impact of the eurozone debt crisis. But the participants appeared unable to make progress on any front. Now he has to fly back to DC to fix the US debt mess.
Europe Ministers Rule Out Stimulus, Offer No Bank Aid at Geithner Meeting
Foreclosed home
Photo: Bloomberg
The number of US homeowners who owe more than their property is worth slipped in Q2 as more residences were lost to foreclosure according to CoreLogic. About 10.88M homes, or 22.5% of those with a mortgage, were “underwater” as of Jun 30, down from 10.91M, or 22.7% in Q1. Another 2.42M borrowers had less than 5% equity at the end of Q2, bringing the total properties with negative or near-negative equity to 27.5% of mortgaged homes. Foreclosures are reducing these numbers. Negative equity is holding back refinancing & home sales, impeding a recovery in the housing market. Almost 75% of underwater homeowners are paying above-market interest on their mortgages, defined as more than than 5.1% versus an average rate for a 30-year fixed loan of 4.12% last week (lowest in records dating back 4 decades). All housing data remains grim which is holding back efforts for the economy to recover.
Fewer U.S.Homeowners ‘Underwater’ as Foreclosures Mount
Dow is up 440 this week, not too bad considering major problems are still stuck in neutral. The delay in providing aid to Greece should have been felt in the markets, but they are accepting the hold up. MLPs continue to flounder. After 2 years of being the leader for all markets, they have been going sideways in 2011. The index reached a new record high in late Apr, but since then sold off in May & has been treading sideways with a few bumps along the way. I think the big gain in the markets this week showed more optimism than was justified. In simpler terms, markets got ahead of themselves.
S&P 500 Financials Sector Index
| Value | 171.93 | |
| Change | -1.73 (-1.0%) |
The MLP index fell 5 to the the 348s while the REIT index fell 2 to the 222s. The MLP index remains near 350, its low in May representing a 10% pullback from the record high at 390. Junk bond funds inched higher & Treasuries were a tad higher. Oil slipped, trimming its 4th straight weekly gain & longest winning streak since Jul, on concern that European plans to solve the region’s debt crisis may founder, threatening economic growth. Gold rose the first time in 3 days on renewed concern that Europe’s debt crisis will threaten economies, boosting demand for a safe haven investment.
ALERIAN MLP Index (^AMZ)
Treasury yields:
U.S. 3-month | 0.000% | |
U.S. 2-year | 0.181% | |
U.S. 10-year | 2.083% |
| CLV11.NYM | ....Crude Oil Oct 11 | ...88.57 | ... 0.83 (0.9%) |
| GCU11.CMX | ...Gold Sep 11 | .....1,776.00 | ... 2.50 | (0.1%) |
Get the latest market update below:
Consumers were slightly more confident in the economy in Sep, but also increasingly worried about the future. The Thomson Reuters/University of Michigan's consumer sentiment index inched up to 57.8 in Sep from 55.7 in Aug. The Aug reading was the lowest since Nov 2008. But consumers are more pessimistic about their future prospects. An index tracking consumer expectations fell to its lowest level since May 1980! Americans are more optimistic about present conditions as that index rose to 74.5 from 68.7. Consumer confidence plunged in Aug, after the gov said the economy barely grew in the H1, lawmakers fought over raising the nation's borrowing limit & S&P downgraded long-term U.S. debt. Not much encouragement in this report.
Michigan Consumer Sentiment Index Rises
Austria's finance minister is criticizing Treasury Sec Tim Geithner for lecturing the eurozone on its crisis strategy but refusing to listen to the currency union's suggestions. Maria Fekter says Geithner in "very dramatic terms" urged the eurozone to get a grip on its debt crisis to avoid destabilizing the global financial system, but then immediately ruled out a tax on financial transactions, which some euro countries see as a way of sharing the burden of expensive bailouts. She said "I would have expected that, if he explains the world to us, that he would also listen to what we want to explain to the Americans." Greece's intl rescue partners will delay until Oct their decision on paying out the next rouind of bailout loans needed to keep Greece from bankruptcy. The announcement was yet another example of Europe's halting effort over almost 2 years to solve its crisis over too much gov debt in some countries. Geithner had joined the meeting, a first for the US finance chief, in a sign of how the US is getting increasingly concerned over the global impact of the eurozone debt crisis. But the participants appeared unable to make progress on any front. Now he has to fly back to DC to fix the US debt mess.
Europe Ministers Rule Out Stimulus, Offer No Bank Aid at Geithner Meeting
Photo: Bloomberg
The number of US homeowners who owe more than their property is worth slipped in Q2 as more residences were lost to foreclosure according to CoreLogic. About 10.88M homes, or 22.5% of those with a mortgage, were “underwater” as of Jun 30, down from 10.91M, or 22.7% in Q1. Another 2.42M borrowers had less than 5% equity at the end of Q2, bringing the total properties with negative or near-negative equity to 27.5% of mortgaged homes. Foreclosures are reducing these numbers. Negative equity is holding back refinancing & home sales, impeding a recovery in the housing market. Almost 75% of underwater homeowners are paying above-market interest on their mortgages, defined as more than than 5.1% versus an average rate for a 30-year fixed loan of 4.12% last week (lowest in records dating back 4 decades). All housing data remains grim which is holding back efforts for the economy to recover.
Fewer U.S.Homeowners ‘Underwater’ as Foreclosures Mount
Dow is up 440 this week, not too bad considering major problems are still stuck in neutral. The delay in providing aid to Greece should have been felt in the markets, but they are accepting the hold up. MLPs continue to flounder. After 2 years of being the leader for all markets, they have been going sideways in 2011. The index reached a new record high in late Apr, but since then sold off in May & has been treading sideways with a few bumps along the way. I think the big gain in the markets this week showed more optimism than was justified. In simpler terms, markets got ahead of themselves.
Dow Industrials (INDU)
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