Dow crossed over 13k, but couldn't hold it. It finished up only 15, decliners barely ahead of advancers & NAZ pulled back 3. The Financial Index slipped a fraction to below 199, still near its interim highs. The MLP index was fractionally lower to 408 while the REIT index fell 4 to 244. Junk bond funds were mixed to lower but Treasuries sold off on news of the Greek bailout. Oil climbed to the highest level since May on concerns about Europe's oil supplies. Iran announced over the weekend that it will stop selling oil to Britain & France in retaliation for a planned European oil embargo this summer. The chart below shows gold shot up 31 on growing doubts about the Greek bailout.
![Live 24 hours gold chart [Kitco Inc.]](http://www.kitco.com/images/live/gold.gif)
Photo: Bloomberg
The picture of the President of the Euro group Jean-Claude Juncker & IMF Managing Director Christine Lagarde tells the story, They're not wearing smiles from happiness! The latest Greek aid package was approved, raising hopes that the worst phase of the sovereign debt crisis is over. But the €130B ($172B) bailout highlights the weaknesses in Europe's response. The worry is that these problems could flare up & undermine recovery efforts in countries like Italy, Spain, Ireland & Portugal. The EU's favored strategy has been to provide tightly controlled financial support to highly indebted countries, in the hope of buying them enough time to implement policies aimed at cutting budget deficits. While such moves can deepen recessions, the goal is to eventually lower debt levels to win back the confidence in the bond markets. But Greece's fate has exposed the severe limitations of Europe's approach to the crisis. Austerity policies contributed to an estimated 6.8% drop in GDP last year. In 2010, the IMF had forecast that Greece's economy would only shrink 2.6% in 2011. Officials want to avoid undertaking similar measures for other countries. A range of measures over the last year have been introduced that may buy more time for struggling countries. The EU is setting up large pools of money to make emergency loans. Leaders have agreed to move toward more coordinated fiscal policies, which may pave the way for richer countries to transfer funds to poorer ones. In Dec, the ECB lent $620B to banks, preventing a bank run & helping firms finance continued purchases of gov bonds. Spain's gov has already sold more than 30% of the $114B worth of bonds it was hoping to issue this year. But one of the lessons of the post-crisis period in the US is that monetary stimulus may only be temporary. Even in the US, monetary stimulus did little to repair the balance sheets of the most debt-laden sectors of the economy. European gov debt levels may take a lot longer to fall than officials had hoped. Certain govs could require even more aid because they will not be able to sell bonds into private markets at affordable interest rates. Nobody knows how this will work out!
Macy’s reported its 3rd consecutive year of improved financial performance. “We have more than doubled our earnings over the past three years, driven by innovative strategic initiatives that are being executed with discipline at both Macy’s and Bloomingdale’s. Our diluted earnings per share, adjusted for certain items, grew by 36 percent in fiscal 2011, on top of double-digit increases in each of 2009 and 2010,” said Terry J. Lundgren, CEO. EPS was $1.74 in Q4, ahead of $1.55 in 2010. For the full year, EPS was $2.92 ahead of guidance provided at the beginning of the year for $2.25-$2.30. Sales for fiscal 2011 totaled $26.4B, up 5.6% from 2010. On a same-store basis, sales rose 5.3%, better than initial guidance of 3%. Online sales were up 40% in Q4 & 39.6% in fiscal 2011. Online sales positively affected same-store sales by 1.7 percentage points in Q4 & 1.5 percentage points in fiscal 2011. The stock gained 44¢.
Macy’s Quarterly Profit Beats Estimates on Controlled Holiday Promotions
This should have been a joyous day in the markets after Greek bailout II was approved. But it wasn't, maybe because doubts & uncertainties remain. Individual countries have to approve bailout II (France just did). Then the bondholders have to approve significant haircuts on their investments, still uncertain. In the US, there's the price of gas which keeps climbing & heading higher. Buyers pushed Dow to 13,005 before giving up. It's still close to that magic ceiling, but if it can't top it in a meaningful way tomorrow, it may see more headwinds.
Source: AAA
JPMorgan Chase Capital XVI (AMJ)
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Treasury yields:
U.S. 3-month | 0.071% | |
U.S. 2-year | 0.299% | |
U.S. 10-year | 2.040% |
| CLH12.NYM | ...Crude Oil Mar 12 | ...105.88 | ... 2.64 | (2.6%) |
The picture of the President of the Euro group Jean-Claude Juncker & IMF Managing Director Christine Lagarde tells the story, They're not wearing smiles from happiness! The latest Greek aid package was approved, raising hopes that the worst phase of the sovereign debt crisis is over. But the €130B ($172B) bailout highlights the weaknesses in Europe's response. The worry is that these problems could flare up & undermine recovery efforts in countries like Italy, Spain, Ireland & Portugal. The EU's favored strategy has been to provide tightly controlled financial support to highly indebted countries, in the hope of buying them enough time to implement policies aimed at cutting budget deficits. While such moves can deepen recessions, the goal is to eventually lower debt levels to win back the confidence in the bond markets. But Greece's fate has exposed the severe limitations of Europe's approach to the crisis. Austerity policies contributed to an estimated 6.8% drop in GDP last year. In 2010, the IMF had forecast that Greece's economy would only shrink 2.6% in 2011. Officials want to avoid undertaking similar measures for other countries. A range of measures over the last year have been introduced that may buy more time for struggling countries. The EU is setting up large pools of money to make emergency loans. Leaders have agreed to move toward more coordinated fiscal policies, which may pave the way for richer countries to transfer funds to poorer ones. In Dec, the ECB lent $620B to banks, preventing a bank run & helping firms finance continued purchases of gov bonds. Spain's gov has already sold more than 30% of the $114B worth of bonds it was hoping to issue this year. But one of the lessons of the post-crisis period in the US is that monetary stimulus may only be temporary. Even in the US, monetary stimulus did little to repair the balance sheets of the most debt-laden sectors of the economy. European gov debt levels may take a lot longer to fall than officials had hoped. Certain govs could require even more aid because they will not be able to sell bonds into private markets at affordable interest rates. Nobody knows how this will work out!
Macy’s reported its 3rd consecutive year of improved financial performance. “We have more than doubled our earnings over the past three years, driven by innovative strategic initiatives that are being executed with discipline at both Macy’s and Bloomingdale’s. Our diluted earnings per share, adjusted for certain items, grew by 36 percent in fiscal 2011, on top of double-digit increases in each of 2009 and 2010,” said Terry J. Lundgren, CEO. EPS was $1.74 in Q4, ahead of $1.55 in 2010. For the full year, EPS was $2.92 ahead of guidance provided at the beginning of the year for $2.25-$2.30. Sales for fiscal 2011 totaled $26.4B, up 5.6% from 2010. On a same-store basis, sales rose 5.3%, better than initial guidance of 3%. Online sales were up 40% in Q4 & 39.6% in fiscal 2011. Online sales positively affected same-store sales by 1.7 percentage points in Q4 & 1.5 percentage points in fiscal 2011. The stock gained 44¢.
Macy’s Quarterly Profit Beats Estimates on Controlled Holiday Promotions
Macy's Inc (M)
This should have been a joyous day in the markets after Greek bailout II was approved. But it wasn't, maybe because doubts & uncertainties remain. Individual countries have to approve bailout II (France just did). Then the bondholders have to approve significant haircuts on their investments, still uncertain. In the US, there's the price of gas which keeps climbing & heading higher. Buyers pushed Dow to 13,005 before giving up. It's still close to that magic ceiling, but if it can't top it in a meaningful way tomorrow, it may see more headwinds.
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