Dow fell 130, decliners over advancers 4-1 & NAZ fell 33. There was modest selling into the close. Bank stocks had a limited recovery in the PM, cutting the loss for the Financial Index to 3+ to the 205s. The MLP index fell 3+ to the 388s & the REIT index was off 3 to the 248s. Junk bond funds were weak but Treasuries rose on growing doubts about economic recovery around the world. The yield on the benchmark 10 year Treasury bond is just above 2% . Oil buyers reduced the losses in the AM, but gold was up $12 to $1640.
![Live 24 hours gold chart [Kitco Inc.]](http://www.kitco.com/images/live/gold.gif)
Photo: Yahoo
Gold rose in thin trade after disappointing US jobs data on Fri revived speculation that the Federal Reserve (FED) might try to stimulate the economy. The precious metal also received a boost from physical buying out of India following the end of a jewelers strike, & as China's inflation data gave it more room to support growth. Bullion has dropped 8% since the end of Feb after a run of strong US economic data suggested that the FED wouldn't launch another round of stimulus. However, data showing US employers had hired far fewer workers in Mar than in previous months left the door open for more stimulus.
Gold Gains 1% on Renewed Stimulus Hopes
The VIX, benchmark gauge for US options prices, rose for a 7th day, the longest streak since Aug 2003, as concern about employment growth & earnings spurred investors to guard against losses in stocks. The VIX, rose 9.3% to 18.25, its highest level in a month. It measures the cost of options on the S&P 500 Index which fell last week. Prices to insure equities increased after the Labor Dept said on Fri that employers added only 120K jobs in Mar, the fewest in 5 months (less than expected). The VIX rose & equities slumped last week after the FED signaled it will refrain from further monetary stimulus & concern grew about Europe's debt crisis. Spain is in “extreme difficulty,” PM Rajoy said last week, raising the possibility of a bailout. The 4th-biggest economy in the region sold €2.6B ($3.4B) of bonds last week, near the minimum, & the spread between yields on its 10-year debt & German bonds widened to a level last seen in Dec. The VIX fell a record 64% in the last 2 qtrs as improvements in US payrolls & consumer confidence pushed the S&P 500 to its biggest Q1 rally since 1998, advancing 12%. Alcoa (AA), a Dow stock, is scheduled to report Q1 results tomorrow. Analysts are looking for a loss of 4¢ per share.
VIX Posts Longest Streak of Gains Since 2003 on Economic Concern
Photo: Bloomberg
Facebook is spending $1B to buy the photo-sharing company Instagram in the social network's largest acquisition. Instagram lets people apply filters to photos they snap with their mobile devices & share them with friends & strangers. Some filters make the photos look as if they've been taken in the 1970s or on Polaroid cameras. "This is an important milestone for Facebook because it's the first time we've ever acquired a product and company with so many users," CEO Mark Zuckerberg wrote on his Facebook page. "We don't plan on doing many more of these, if any at all." Facebook plans to keep Instagram running independently, a departure from its tendency to buy small startups & integrate the technology (or shut them down altogether just so it can hire talented engineers & developers). "We think the fact that Instagram is connected to other services beyond Facebook is an important part of the experience," Zuckerberg wrote. "We plan on keeping features like the ability to post to other social networks, the ability to not share your Instagrams on Facebook if you want, and the ability to have followers and follow people separately from your friends on Facebook." Facebook is paying with cash & stock & hiring its 10 employees. The deal is expected to close in Jun. Facebook is expected to complete its IPO next month. Getting Instagram is considered a big win for Facebook as it works to harness a growing obsession with mobile devices & sharing every moment. Instagram was only available on Apple (AAPL) devices until recently, but an app for Android devices was released last week.
Facebook Agrees to Acquire Instagram Photo-Sharing Service for $1 Billion
Buyers returned after lunch but there was more selling in the last hour. Dow topped 13K on Mar 13 with a 200+ gain but has been going sideways since then. The longer term chart below shows the stellar run until that point. European debt woes, a possible slowdown in China & a recovery in the US which appears to be slowing are ingredients for a market pullback. AA earnings tomorrow will give a more important sign than usual about the direction of the markets. AA was flat today after going sideways for more than 6 months.
JPMorgan Chase Capital XVI (AMJ)
Click below for the latest market update:
Treasury yields:
U.S. 3-month | 0.076% | |
U.S. 2-year | 0.314% | |
U.S. 10-year | 2.032% |
| CLK12.NYM | ...Crude Oil May 12 | ...102.46 | ... 0.85 | (0.8%) |
Gold rose in thin trade after disappointing US jobs data on Fri revived speculation that the Federal Reserve (FED) might try to stimulate the economy. The precious metal also received a boost from physical buying out of India following the end of a jewelers strike, & as China's inflation data gave it more room to support growth. Bullion has dropped 8% since the end of Feb after a run of strong US economic data suggested that the FED wouldn't launch another round of stimulus. However, data showing US employers had hired far fewer workers in Mar than in previous months left the door open for more stimulus.
Gold Gains 1% on Renewed Stimulus Hopes
The VIX, benchmark gauge for US options prices, rose for a 7th day, the longest streak since Aug 2003, as concern about employment growth & earnings spurred investors to guard against losses in stocks. The VIX, rose 9.3% to 18.25, its highest level in a month. It measures the cost of options on the S&P 500 Index which fell last week. Prices to insure equities increased after the Labor Dept said on Fri that employers added only 120K jobs in Mar, the fewest in 5 months (less than expected). The VIX rose & equities slumped last week after the FED signaled it will refrain from further monetary stimulus & concern grew about Europe's debt crisis. Spain is in “extreme difficulty,” PM Rajoy said last week, raising the possibility of a bailout. The 4th-biggest economy in the region sold €2.6B ($3.4B) of bonds last week, near the minimum, & the spread between yields on its 10-year debt & German bonds widened to a level last seen in Dec. The VIX fell a record 64% in the last 2 qtrs as improvements in US payrolls & consumer confidence pushed the S&P 500 to its biggest Q1 rally since 1998, advancing 12%. Alcoa (AA), a Dow stock, is scheduled to report Q1 results tomorrow. Analysts are looking for a loss of 4¢ per share.
VIX Posts Longest Streak of Gains Since 2003 on Economic Concern
Facebook is spending $1B to buy the photo-sharing company Instagram in the social network's largest acquisition. Instagram lets people apply filters to photos they snap with their mobile devices & share them with friends & strangers. Some filters make the photos look as if they've been taken in the 1970s or on Polaroid cameras. "This is an important milestone for Facebook because it's the first time we've ever acquired a product and company with so many users," CEO Mark Zuckerberg wrote on his Facebook page. "We don't plan on doing many more of these, if any at all." Facebook plans to keep Instagram running independently, a departure from its tendency to buy small startups & integrate the technology (or shut them down altogether just so it can hire talented engineers & developers). "We think the fact that Instagram is connected to other services beyond Facebook is an important part of the experience," Zuckerberg wrote. "We plan on keeping features like the ability to post to other social networks, the ability to not share your Instagrams on Facebook if you want, and the ability to have followers and follow people separately from your friends on Facebook." Facebook is paying with cash & stock & hiring its 10 employees. The deal is expected to close in Jun. Facebook is expected to complete its IPO next month. Getting Instagram is considered a big win for Facebook as it works to harness a growing obsession with mobile devices & sharing every moment. Instagram was only available on Apple (AAPL) devices until recently, but an app for Android devices was released last week.
Facebook Agrees to Acquire Instagram Photo-Sharing Service for $1 Billion
Buyers returned after lunch but there was more selling in the last hour. Dow topped 13K on Mar 13 with a 200+ gain but has been going sideways since then. The longer term chart below shows the stellar run until that point. European debt woes, a possible slowdown in China & a recovery in the US which appears to be slowing are ingredients for a market pullback. AA earnings tomorrow will give a more important sign than usual about the direction of the markets. AA was flat today after going sideways for more than 6 months.
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