Monday, March 5, 2012

Markets trim morning losses

Stocks recovered in the PM with Dow down only 14 (80 above its lows), decliners ahead of advancers 3-2 & NAZ off a bigger 25 from a weak tech sector.  Bank stocks also recovered, limiting the loss to 1 for the Financial Index from Fri's interim high of 200.

The MLP index fell 1 to the 408s while the REIT index rose 2 to the 246s (near its yearly highs).  Junk bond funds slipped as did Treasuries.  Oil edged higher as Obama & Israeli PM Netanyahu met to discuss how to confront Iran over its nuclear program & after China cut its economic growth target.  Gold slipped $3.

JPMorgan Chase Capital XVI (AMJ)

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CLJ12.NYM...Crude Oil Apr 12...106.82...Up 0.12  (0.1%)

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Venizelos Says Debt Swap Is Best, Only Offer for Investors

Christine Lagarde from the IMF & Greek Finance Minister Evangelos
Photo:   Bloomberg

European leaders are facing the first test of their attempt to turn the page on the 2-year debt crisis as the private creditors decide whether to sign off on the biggest sovereign- debt restructuring in history. The success of the €106B swap, confirmed on the eve of last week’s European summit, depends on how many investors agree to the writedown by the Mar 8 deadline.  12 banks & investors negotiated the swap with the gov, saying today that they planned to take up the offer.  However, one steering-committee member has still to back the offer.  Germany's DSW investor protection group meanwhile advised private-sector bondholders to reject the offer.  The Greek gov has set a 75% participation rate as a threshold for proceeding with the transaction, in which investors will forgive 53.5% of their principal & exchange their remaining holdings for new Greek bonds & notes from the European Financial Stability Facility.  Euro- area finance ministers last week authorized the new bonds for the swap.  Can you spell "touchy?"

Venizelos: Greek Debt Swap Best, Only Offer

Enbridge Inc, general manager for Enbridge Partners (EEP) - a major MLP, plans to resume crude deliveries this week on its pipeline in Illinois that was shut over the weekend, allowing supply to reach Chicago-area refineries.  Line 14 may start operating on Wed & line 64 the following day.  Line 6A, also closed by a fire at an EEP pumping station, has already restarted.  Deliveries were halted on line 14/64 after 2 vehicles collided, starting a fire at the pumping station near New Lenox, Illinois, 36 miles southwest of Chicago.  2 people were killed & several others injured in the crash.  ENB fell 15¢.

Enbridge Shuts Illinois Crude Pipeline After Fire; Oil Prices May Advance

Enbridge Inc (ENB)

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Gas prices keep shooting up (according to AAA).  The $3.77 average price will go higher this week.

National Unleaded Average
Current Avg.$3.767$3.915$4.046$4.083$3.201$4.213
Yesterday Avg.$3.764$3.910$4.041$4.078$3.199$4.210
Week Ago Avg. $3.698$3.843$3.974$4.030$3.166$4.166
Month Ago Avg. $3.475$3.602$3.738$3.878$3.088$4.064
Year Ago Avg. $3.503$3.634$3.763$3.863$2.929$3.854

12onth Average
State's Graph
Sellers failed to take control control, largely on a lack of significant news one way or the other.  Dow reached 12.9K on Feb 16 & has been treading water since then.  That includes much of earnings season.  The ENB story was mentioned as a reminder than MLPs (EEP) are mortal & subject to problems like other companies.  The Greek bailout is far from a done deal as creditors have to agree to the haircut on their investments,  The 75% acceptance level is above the two-thirds that Greece claims is good enough.  Who knows?  At a minimum, there will be disgruntled investors.

Dow Industrials

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