Friday, March 16, 2012

Markets fluctaute on mixed economic data

Dow lost 19, decliners ahead of advancers 5-4 & NAZ slipped 1.  Bank stocks had modest gains taking the Financial Index up a fraction in the 211s (up 11 this week).

The MLP index finally rose, up 1+ to the 397s, & the REIT index added 1 to 251 (only 2 below its yearly high).  Junk bond funds fell while the Treasury 10-year bond extended the biggest weekly drop in 8 months as a report showed the cost of living rose in Feb added to concern inflation may accelerate as the economy strengthens.  Oil rebounded & gold was flattish (more on both below).

JPMorgan Chase Capital XVI (AMJ)

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CLJ12.NYM...Crude Oil Apr 12....107.07 ...Up 1.96  (1.9%)

Live 24 hours gold chart [Kitco Inc.]

Gasoline prices rose again & are now averaging more than $4 in 6 states plus DC.  Retail gasoline prices were up a penny on Fri to a national average of $3.83 per gallon, according to AAA, as oil prices rose to $107.  The average price for regular is now above $4 in Alaska, California, Connecticut, Hawaii, Illinois & New York.  Gasoline has jumped by 56¢ since the start of the year & is the highest ever for this time of year.  Drivers pay an extra $11.20 to fill up a 20-gallon tank.

  • National Unleaded Average
    Regular Mid Premium Diesel 85 **E85
    Current Avg. $3.831 $3.973 $4.104 $4.126 $3.265 $4.297
    Yesterday Avg. $3.821 $3.965 $4.096 $4.122 $3.262 $4.292
    Week Ago Avg. $3.758 $3.901 $4.034 $4.092 $3.217 $4.233
    Month Ago Avg. $3.518 $3.644 $3.778 $3.935 $3.107 $4.089
    Year Ago Avg. $3.546 $3.682 $3.813 $3.930 $2.993 $3.939

    • Pre-produced parts of watches are on display at a plant of gold refiner and bar manufacturer Argor-Heraeus SA in the southern Swiss town of Mendrisio, March 1, 2012. REUTERS/Pascal Lauener
    Photo:   Yahoo

    Gold steadied today but had its largest weekly decline in 3 months, after top consumer India said it would double import duties on bullion & upbeat US data this week fed optimism over the global economy which boosted risk appetite.  Customs duty on Indian imports of gold & platinum will rise effective Mar17 as part of measures to cut the deficit in the 2012/13 budget.  The bullion market relies heavily on Indian jewelry demand.  Last year, the country imported a record 969 tons & the strong growth in imports had played a key role in widening India's current account deficit.  Gold has also been hampered this week by the rise in the dollar & soaring treasury yields, following data showing the US economy may be on a stronger footing than initially expected.  Investors hold a near-record amount of gold in exchange-traded products & have stepped up their holdings of gold thru US futures in 2012, meaning the market could be subject to steeper sell-offs by disenchanted players in the near term.

  • Apple started selling its new iPad3 today, betting on a sharper screen & faster chip to extend its lead in the growing market for tablet computers.  The 9.7" tablet is the biggest upgrade yet to the AAPL tablet before Microsoft (MSFT), a Dow stock, introduces new software for competing devices later this year.  Generating demand with the model is important to fend off competition from devices using the Android operating system from Google (GOOG) & the Kindle Fire from Amazon (AMZN).  The iPad3, with a price of $499-$829, includes a chip that enables better graphics, has a screen with more pixels than traditional hi-def TVs & runs on long-term evolution (LTE) wireless networks that deliver data faster.  The stock was up a penny to $585 (& began the year at $405).

    Apple Starts Selling Third IPad Model to Extend Lead Over Google, Amazon

    Apple Inc. (AAPL)

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    Sears to Close 62 Stores in First Half of This Year

    Photo:   Bloomberg

    Sears plans to close 62 retail stores in H1 to reduce expenses.  The closings include 43 Sears Hometown stores, 10 Sears Hardware stores & 9 The Great Indoors stores.  The company, which also owns the Kmart chain, has 4010 stores.  After the company posted its largest quarterly loss in 9 years. SHLD said it planned to raise as much as $770M by selling 11 store sites & separating some smaller-format businesses.  After a spectacular run this year, but fell 88¢ today.

    Sears To Close 62 Stores by July to Reduce Costs

    Sears Holdings Corporation (SHLD)

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    Dow is up 280 in Mar & almost 3K from its lows 6 months ago.  Not bad.  The European debt was hardly a bother & uncertainties about extending tax cuts were brushed aside.  The excitement in AAPL stock has helped bring out more buyers for all stocks.  Today's decline, breaking a streak of 7 consecutive up days, does not qualify as a signal to "buy on the dip."  With Dow solidly over 13K & the S&P 500 above 1400, the bulls are feeling good again & will try to extend this week's advance.  But rising gas prices should be getting more attention.

    Dow Industrials

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