Dow slid 14, decliners ahead of advancers 3-2 & NAZ rose 12 (helped by a 9 point rise for Apple to a new record). Bank stocks drifted lower, taking the Financial Index down a fraction in the 209s. The index has been going sideways since mid Mar. The MLP index was up fraction to 391, but has had a tough go of it this year, while the REIT index fell 1 to 251. Junk bond funds slipped & Treasuries rose, bringing lower yields. Gold rose, as investors covered short positions, after a sharp 2-day pullback, & a rally in oil also buoyed the precious metal that sank earlier this week when investors grew pessimistic about further US monetary easing.
![Live 24 hours gold chart [Kitco Inc.]](http://www.kitco.com/images/live/gold.gif)
JC Penney will lay off 600 workers (13% of the staff) at its headquarters in Texas, as the company looks to streamline its operations amid a major reinvention of the business. It will also eliminate 300 more jobs at its customer call center in Pittsburgh when it closes in Jul. The moves come as the new CEO Ron Johnson is transforming every aspect of the business, from pulling back on constant promotions to rethinking the brands it carries. "We are going to operate like a start-up," said Johnson in a press release issued Thursday that didn't cite specific job cuts. "We are going to be nimble, quick to learn, quicker to react and totally committed to realizing our vision to become America's favorite store." Johnson said the cuts involved "some very difficult decisions" but were essential for the business. The company had said then it was targeting $900M in expense cuts to be completed over the first 2 years of its transformation, including $200M in savings from headquarters as well as $400M in cost savings at store operations & $300M in advertising savings. The changes are expected to reduce expenses below 30% of sales by the end of next year. Before the layoffs, JCP had 4400 employees at its headquarters. While not significant at the big picture level, this will add to the unemployed looking for work. The stock was off 49¢.
Penney cuts 600 workers, 13 percent of HQ staff AP
The average rate on the 30-year fixed mortgage was mostly unchanged this week, as the cost of home-buying & refinancing remained near record lows. Mortgage buyer Freddie Mac said that the rate on the 30-year loan fell slightly to 3.98% from 3.99% last week. In Feb, the rate touched 3.87%, the lowest since long-term mortgages began in the 1950s. The average rate on the 15-year fixed mortgage also fell, to 3.21% from 3.23%. That's above the record low of 3.13% hit last month. Mortgage rates have been below 4% for all but one week since early Dec which has helped lift the outlook for housing after 4 sluggish years of home sales. Jan & Feb made up the best winter for re-sales in 5 years, when the housing crisis began & builders are more confident about the market. In February, they requested the most permits to build single-family homes & apartments in more than 3 years. Applications for new mortgages rose in Mar & there was a sharp rise in the average loan size, suggesting a bigger appetite for home loans. The average size of mortgage applications has increased by $20K since DecK, to $235K last month. A hopeful sign for housing.
30-Year Mortgage Rate Falls to 3.98%
Photo: Yahoo
The President signed bipartisan jobs legislation that will help small businesses & make it easier for startups to raise capital, saying it could be a "game-changer" for entrepreneurs dreaming of founding the next Microsoft (MSFT), a Dow stock, or Facebook. "When their ideas take root, we get inventions that can change the way we live," Obama said. "And when their businesses take off, more people become employed." While receiving bipartisan support, some Dems raised concerns that the bill softened investment protections enacted after the dot.com excesses & Wall Street meltdowns with changes that could lead to fraud & abuse. The main part of the bill would phase in SEC regulations over a 5-year period to let smaller companies go public sooner. Firms that have annual gross revenues of less than $1B would enjoy this "emerging growth company" status.
Obama signs small business legislation AP
The average price at the pump for gas is matching the high for last year & near the $4.11 record in mid 2008.
Source: AAA
Investors weighed optimism about the American job market with renewed concern over Europe’s debt crisis & the latter was of greater concern today. Earnings season kicks off next week with Alcoa (AA), a Dow stock, reporting on Tues. Analysts are looking for a 5¢ loss versus a profit last year. Dow gave up 152 this week but was able to hold above 13K. S&P 500 has been waffling around 1400 (closing at 1398 today) without breaking thru since mid Mar. The stock market looks very tired after a long run.
JPMorgan Chase Capital XVI (AMJ)
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Treasury yields:
U.S. 3-month | 0.066% | |
U.S. 2-year | 0.341% | |
U.S. 10-year | 2.172% |
| CLK12.NYM | Crude Oil May 12 | 103.32 |  1.85 (1.8%) |
JC Penney will lay off 600 workers (13% of the staff) at its headquarters in Texas, as the company looks to streamline its operations amid a major reinvention of the business. It will also eliminate 300 more jobs at its customer call center in Pittsburgh when it closes in Jul. The moves come as the new CEO Ron Johnson is transforming every aspect of the business, from pulling back on constant promotions to rethinking the brands it carries. "We are going to operate like a start-up," said Johnson in a press release issued Thursday that didn't cite specific job cuts. "We are going to be nimble, quick to learn, quicker to react and totally committed to realizing our vision to become America's favorite store." Johnson said the cuts involved "some very difficult decisions" but were essential for the business. The company had said then it was targeting $900M in expense cuts to be completed over the first 2 years of its transformation, including $200M in savings from headquarters as well as $400M in cost savings at store operations & $300M in advertising savings. The changes are expected to reduce expenses below 30% of sales by the end of next year. Before the layoffs, JCP had 4400 employees at its headquarters. While not significant at the big picture level, this will add to the unemployed looking for work. The stock was off 49¢.
Penney cuts 600 workers, 13 percent of HQ staff AP
J.C. Penney Company, Inc. Holding Company (JCP)
The average rate on the 30-year fixed mortgage was mostly unchanged this week, as the cost of home-buying & refinancing remained near record lows. Mortgage buyer Freddie Mac said that the rate on the 30-year loan fell slightly to 3.98% from 3.99% last week. In Feb, the rate touched 3.87%, the lowest since long-term mortgages began in the 1950s. The average rate on the 15-year fixed mortgage also fell, to 3.21% from 3.23%. That's above the record low of 3.13% hit last month. Mortgage rates have been below 4% for all but one week since early Dec which has helped lift the outlook for housing after 4 sluggish years of home sales. Jan & Feb made up the best winter for re-sales in 5 years, when the housing crisis began & builders are more confident about the market. In February, they requested the most permits to build single-family homes & apartments in more than 3 years. Applications for new mortgages rose in Mar & there was a sharp rise in the average loan size, suggesting a bigger appetite for home loans. The average size of mortgage applications has increased by $20K since DecK, to $235K last month. A hopeful sign for housing.
30-Year Mortgage Rate Falls to 3.98%
The President signed bipartisan jobs legislation that will help small businesses & make it easier for startups to raise capital, saying it could be a "game-changer" for entrepreneurs dreaming of founding the next Microsoft (MSFT), a Dow stock, or Facebook. "When their ideas take root, we get inventions that can change the way we live," Obama said. "And when their businesses take off, more people become employed." While receiving bipartisan support, some Dems raised concerns that the bill softened investment protections enacted after the dot.com excesses & Wall Street meltdowns with changes that could lead to fraud & abuse. The main part of the bill would phase in SEC regulations over a 5-year period to let smaller companies go public sooner. Firms that have annual gross revenues of less than $1B would enjoy this "emerging growth company" status.
Obama signs small business legislation AP
The average price at the pump for gas is matching the high for last year & near the $4.11 record in mid 2008.
| Regular | Mid | Premium | Diesel | 85 | **E85 MPG/BTU adjusted price | |
| Current Avg. | $3.936 | $4.069 | $4.200 | $4.166 | $3.345 | $4.403 |
| Yesterday Avg. | $3.928 | $4.063 | $4.195 | $4.164 | $3.335 | $4.389 |
| Week Ago Avg. | $3.921 | $4.059 | $4.190 | $4.162 | $3.313 | $4.360 |
| Month Ago Avg. | $3.764 | $3.911 | $4.044 | $4.084 | $3.216 | $4.233 |
| Year Ago Avg. | $3.707 | $3.839 | $3.968 | $4.003 | $3.119 | $4.104 |
Source: AAA
Investors weighed optimism about the American job market with renewed concern over Europe’s debt crisis & the latter was of greater concern today. Earnings season kicks off next week with Alcoa (AA), a Dow stock, reporting on Tues. Analysts are looking for a 5¢ loss versus a profit last year. Dow gave up 152 this week but was able to hold above 13K. S&P 500 has been waffling around 1400 (closing at 1398 today) without breaking thru since mid Mar. The stock market looks very tired after a long run.
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