Dow fell 101, decliners over advancers 5-2 & NAZ was off 43. The Financial Index dropped more than 2 to below 211 (its yearly high was 218 made on Sep 14). The MLP index lost 3 to 402 (although it remains near its record high at 411) & the REIT index fell 3+ to the 262s. Junk bond funds were lower & Treasuries rose as stocks sold off. Oil fell, erasing earlier gains, on
speculation that US. stockpiles will climb & gold was a tad lower.
![Live 24 hours gold chart [Kitco Inc.]](http://www.kitco.com/images/live/gold.gif)
Photo: Bloomberg
Home prices in the US, which climbed more than forecast in Jul, are unlikely to come “roaring” back as the housing market reaches bottom, according to Karl Case, the economist who co-created the S&P/Case-Shiller index. The index of property values in 20 cities rose 1.2% from Jul 2011, the biggest 12-month jump since Aug 2010, beating a forecasted gain of 1.1 % gain. The increase followed an advance in Jun that was the first on a year-over-year basis since a temporary federal tax credit boosted sales in 2010. The index, while rising, remains 30% below its peak in Jul 2006. A broader recovery may be hindered by tight lending standards, slow economic growth & a limited supply of properties on the market as Americans choose to stay in their homes rather than sell, professor Case said. The unemployment rate was above 8% in Aug for the 43rd consecutive month. “We’re at a bottom but I don’t think we’ll come roaring out of here,” Case said. “You’ve got problems in the economy, problems abroad, and got the demographics to worry about.” A separate index from the Federal Housing Finance Agency showed prices for single-family houses with mortgages backed by Fannie Mae or Freddie Mac rose 0.2% in Jul from the previous month, short of the 0.6% forecasted gain. Prices rose 3.7% from a year earlier, the FHFA said.
Home Prices Unlikely to Come ‘Roaring’ Back, Case Says
Photo: Bloomberg
China's central bank added a record 290B yuan ($46B) to the financial system using reverse-repurchase agreements, seeking to address a cash squeeze in the run-up to a week-long holiday. The People’s Bank of China conducted 190B yuan of 28-day reverse repos & offered 100B yuan of 14-day contracts. Today’s total is the highest for a single day going back to 2004. It's hard to believe this is a Communist country! The 7-day repo-rate gained 19 basis points to 4.70% in Shanghai. The central bank kept the yields on 28 & 14-day reverse repos unchanged at 3.6% & 3.45%, respectively. China’s financial markets will be shut from Oct 1-5 for holidays. China’s monetary authority also auctioned 40B yuan of 6-month treasury deposits to commercial banks on behalf of the Ministry of Finance at a yield of 4.32%. The PBOC lowered the amount of cash lenders must set aside as reserves in May to 20%, the 2nd reduction this year. There is a lot going on in this financial powerhouse.
Enterprise Products Partners, one of the largest MLPs, priced a public offering of 8M units, raising $412M to reduce debt & for general purposes. The units priced at $53.07 each, a 2.7% discount to the Mon closing price of $54.57. Underwriters may buy another 1.2M units if there's demand. The company said last week that management wanted to increase its distribution for the rest of the year, as several projects have exceeded production expectations. EPD has a long string of qtr over qtr distribution increases. MLPs generally are at or rear record levels because there is plenty of money willing to finance expansion in energy projects. The units fell $1.07 to $53.50 after the offering (but off the lows).
Enterprise Products raising $412M from offering AP
Markets failed to get a head of steam up for the 7th consecutive day. There may be a growing realization that Q3 earnings could be so-so or even worse. At the same time, China is not the force behind world growth it has been & the recession in Europe is hurting companies worldwide. Even wonder stock Apple (AAPL) saw selling, falling almost 17 today & 32 below its record high just 2 days ago. Dow close at 13457, a 7 day low & just above the 13.4K ceiling it had been held under for months. That former ceiling will be tested, probably tomorrow.
AMJ (Alerian MLP Index tracking fund)
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Treasury yields:
U.S. 3-month |
0.101% | |
U.S. 2-year |
0.262% | |
U.S. 10-year |
1.682% |
| CLX12.NYM | ...Crude Oil Nov 12.... | 91.32 | ... 0.61 | (0.7%) |
Home prices in the US, which climbed more than forecast in Jul, are unlikely to come “roaring” back as the housing market reaches bottom, according to Karl Case, the economist who co-created the S&P/Case-Shiller index. The index of property values in 20 cities rose 1.2% from Jul 2011, the biggest 12-month jump since Aug 2010, beating a forecasted gain of 1.1 % gain. The increase followed an advance in Jun that was the first on a year-over-year basis since a temporary federal tax credit boosted sales in 2010. The index, while rising, remains 30% below its peak in Jul 2006. A broader recovery may be hindered by tight lending standards, slow economic growth & a limited supply of properties on the market as Americans choose to stay in their homes rather than sell, professor Case said. The unemployment rate was above 8% in Aug for the 43rd consecutive month. “We’re at a bottom but I don’t think we’ll come roaring out of here,” Case said. “You’ve got problems in the economy, problems abroad, and got the demographics to worry about.” A separate index from the Federal Housing Finance Agency showed prices for single-family houses with mortgages backed by Fannie Mae or Freddie Mac rose 0.2% in Jul from the previous month, short of the 0.6% forecasted gain. Prices rose 3.7% from a year earlier, the FHFA said.
Home Prices Unlikely to Come ‘Roaring’ Back, Case Says
China's central bank added a record 290B yuan ($46B) to the financial system using reverse-repurchase agreements, seeking to address a cash squeeze in the run-up to a week-long holiday. The People’s Bank of China conducted 190B yuan of 28-day reverse repos & offered 100B yuan of 14-day contracts. Today’s total is the highest for a single day going back to 2004. It's hard to believe this is a Communist country! The 7-day repo-rate gained 19 basis points to 4.70% in Shanghai. The central bank kept the yields on 28 & 14-day reverse repos unchanged at 3.6% & 3.45%, respectively. China’s financial markets will be shut from Oct 1-5 for holidays. China’s monetary authority also auctioned 40B yuan of 6-month treasury deposits to commercial banks on behalf of the Ministry of Finance at a yield of 4.32%. The PBOC lowered the amount of cash lenders must set aside as reserves in May to 20%, the 2nd reduction this year. There is a lot going on in this financial powerhouse.
Enterprise Products Partners, one of the largest MLPs, priced a public offering of 8M units, raising $412M to reduce debt & for general purposes. The units priced at $53.07 each, a 2.7% discount to the Mon closing price of $54.57. Underwriters may buy another 1.2M units if there's demand. The company said last week that management wanted to increase its distribution for the rest of the year, as several projects have exceeded production expectations. EPD has a long string of qtr over qtr distribution increases. MLPs generally are at or rear record levels because there is plenty of money willing to finance expansion in energy projects. The units fell $1.07 to $53.50 after the offering (but off the lows).
Enterprise Products raising $412M from offering AP
Enterprise Products Partners (EPD)
Markets failed to get a head of steam up for the 7th consecutive day. There may be a growing realization that Q3 earnings could be so-so or even worse. At the same time, China is not the force behind world growth it has been & the recession in Europe is hurting companies worldwide. Even wonder stock Apple (AAPL) saw selling, falling almost 17 today & 32 below its record high just 2 days ago. Dow close at 13457, a 7 day low & just above the 13.4K ceiling it had been held under for months. That former ceiling will be tested, probably tomorrow.
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