Dow fell 50 with a loss of faith in resolving the debt mess, advancers marginally ahead of decliners & NAZ fell 7. Bank stocks hardly budged.
The MLP & REIT indices were pretty much even, marking time, & junk bond funds were also flattish. Treasuries fell with the 10 year yield nearing 2%. Oil futures pared gains after the Energy Department reported inventories of gasoline climbed more than expected & distillate fuel supplies unexpectedly increased. Gold was little changed, although it is having a good year.
Photo: Yahoo
McDonald's, a Dow stock & Dividend Aristocrat, reported a better-than-expected rise in Jan same store sales worldwide. Strength in the US helped offset the impact of economic weakness in Europe. Sales at restaurants open at least 13 months rose 6.7% globally beating estimates of 5.9%. CEO Jim Skinner said MCD boosted sales in the US by keeping restaurants open longer; about 40% of stores operate 24 hours a day. The chain has recently promoted classic items such as the Big Mac & Chicken McNuggets as well as a McRib sandwich & Chicken McBites at US locations, which generate about one-third of revenue. The stock was off 38¢.
McDonald’s January Same-Store Sales Rise 6.7% as Chicken Items Boost U.S.
Protesters in Athens
Photo; Yahoo
The Greek coalition leaders arrived for crucial debt talks with the prime minister to review a draft deal on steep cutbacks demanded by creditors in return for a €130B ($170B) bailout. Leaders of 3 parties backing the coalition are under pressure to accept the new austerity demands & shield the country from a looming bankruptcy. The meeting finally went ahead after 3 days of delays. Greece has already accepted a demand to layoff up to 15K workers in the public sector in 2012, but is under pressure to impose deeper cuts, including reductions in pension payments & the minimum wage. It was not clear whether the parties would accept these demands. The debt mess drones on.
Greek party leaders arrive for crucial debt talks AP
The costs of faulty mortgages & shoddy foreclosures topped $72B at the biggest US banks as they near a settlement of a 50-state probe into the industry practices. Wells Frago (WFC), Bank of America (BAC), Citigroup (C) JPMorgan (JPM) & Ally Financial (formerly GMAC), the 5 largest lenders, tallied at least $6.8B in new costs tied to mortgages during H2 of 2011. BAC, ranked #2 by assets, contributed $41.8B to the overall total. Mounting costs are pushing lenders & regulators to resolve investigations & lawsuits over faulty home lending, including a 50-state review of foreclosures. Wrangling over the status of old loans has made some banks more reluctant to make new ones, even as Ben Bernanke appeals for action to increase lending to fix the housing market. The banks are negotiating a settlement worth as much as $25B with state attorneys general. That may expand later to include smaller lenders that made loans.
Bad Home Loans Top $72 Billion in ‘Colossal Failure’: Mortgages
Larry Fink, CEO at ClackRock (BLK), says investors should have 100% of investments in equities because of valuations & higher returns than bonds. He said that investors seeking the safety of treasury bonds will have minimal returns. "You need to take on more risk, you need to overcome all this noise," he said. "When you look at dividend returns on equities versus bond yields, to me it's a pretty easy decision to be heavily in equities." He added that the Greek debt crisis will be resolved as it's not in anyone's interests to have a blowup now. Contrarians will view this as a recommendation for selling.
BlackRock's Fink: Investors Should Be 100% in Equities
There is not much going on again. One of the interesting stories today was about Clint Eastwood & his Chrysler commercial. This is getting more attention than the goings on in the markets. Nobody knows where the Greek debt mess will lead. Volume is light while negotiations drag on. But markets are holding their gains made this year & Dow has its eyes on 13K, hoping to reach it shortly.
The MLP & REIT indices were pretty much even, marking time, & junk bond funds were also flattish. Treasuries fell with the 10 year yield nearing 2%. Oil futures pared gains after the Energy Department reported inventories of gasoline climbed more than expected & distillate fuel supplies unexpectedly increased. Gold was little changed, although it is having a good year.
JPMorgan Chase Capital XVI (AMJ)
Treasury yields:
U.S. 3-month | 0.081% | |
U.S. 2-year | 0.250% | |
U.S. 10-year | 1.991% |
| CLH12.NYM | ...Crude Oil Mar 12 | ...99.79 | ... 1.38 | (1.4%) |
| GCG12.CMX | ...Gold Feb 12 | ......1,747.30 | ... 0.90 | (0.1%) |
Get the last daily market update below:
McDonald's, a Dow stock & Dividend Aristocrat, reported a better-than-expected rise in Jan same store sales worldwide. Strength in the US helped offset the impact of economic weakness in Europe. Sales at restaurants open at least 13 months rose 6.7% globally beating estimates of 5.9%. CEO Jim Skinner said MCD boosted sales in the US by keeping restaurants open longer; about 40% of stores operate 24 hours a day. The chain has recently promoted classic items such as the Big Mac & Chicken McNuggets as well as a McRib sandwich & Chicken McBites at US locations, which generate about one-third of revenue. The stock was off 38¢.
McDonald’s January Same-Store Sales Rise 6.7% as Chicken Items Boost U.S.
McDonald's Corporation (MCD)
Photo; Yahoo
The Greek coalition leaders arrived for crucial debt talks with the prime minister to review a draft deal on steep cutbacks demanded by creditors in return for a €130B ($170B) bailout. Leaders of 3 parties backing the coalition are under pressure to accept the new austerity demands & shield the country from a looming bankruptcy. The meeting finally went ahead after 3 days of delays. Greece has already accepted a demand to layoff up to 15K workers in the public sector in 2012, but is under pressure to impose deeper cuts, including reductions in pension payments & the minimum wage. It was not clear whether the parties would accept these demands. The debt mess drones on.
Greek party leaders arrive for crucial debt talks AP
The costs of faulty mortgages & shoddy foreclosures topped $72B at the biggest US banks as they near a settlement of a 50-state probe into the industry practices. Wells Frago (WFC), Bank of America (BAC), Citigroup (C) JPMorgan (JPM) & Ally Financial (formerly GMAC), the 5 largest lenders, tallied at least $6.8B in new costs tied to mortgages during H2 of 2011. BAC, ranked #2 by assets, contributed $41.8B to the overall total. Mounting costs are pushing lenders & regulators to resolve investigations & lawsuits over faulty home lending, including a 50-state review of foreclosures. Wrangling over the status of old loans has made some banks more reluctant to make new ones, even as Ben Bernanke appeals for action to increase lending to fix the housing market. The banks are negotiating a settlement worth as much as $25B with state attorneys general. That may expand later to include smaller lenders that made loans.
Bad Home Loans Top $72 Billion in ‘Colossal Failure’: Mortgages
Larry Fink, CEO at ClackRock (BLK), says investors should have 100% of investments in equities because of valuations & higher returns than bonds. He said that investors seeking the safety of treasury bonds will have minimal returns. "You need to take on more risk, you need to overcome all this noise," he said. "When you look at dividend returns on equities versus bond yields, to me it's a pretty easy decision to be heavily in equities." He added that the Greek debt crisis will be resolved as it's not in anyone's interests to have a blowup now. Contrarians will view this as a recommendation for selling.
BlackRock's Fink: Investors Should Be 100% in Equities
There is not much going on again. One of the interesting stories today was about Clint Eastwood & his Chrysler commercial. This is getting more attention than the goings on in the markets. Nobody knows where the Greek debt mess will lead. Volume is light while negotiations drag on. But markets are holding their gains made this year & Dow has its eyes on 13K, hoping to reach it shortly.
Dow Industrials
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