Dow reduced its losses to 139, decliners over advancers 5-1 & NAZ was off 36. MLP losses were pared in the PM with the index off only 4+ to 432 & the REIT index lost 1+ to the 266s. Junk bond funds were mixed (an improvement from selling in the AM) & Treasuries rallied, with the 10 yield closing at 2.55% (still up almost one percentage point in less than 2 months). Oil gained
for the first time in 4 days after 3 pipelines in Alberta, Canada were shut because of flooding. Gold dropped $10 to a 3 year low.
AMJ (Alerian MLP Index tracking fund)
![Live 24 hours gold chart [Kitco Inc.]](http://www.kitco.com/images/live/gold.gif)
Photo: Bloomberg
President Richard Fisher of the Federal Reserve Bank of Dallas President said he favors scaling back the Fed’s monthly bond-buying if the economy makes the kind of progress officials are currently expecting. “I agree fully with the chairman that we should dial back on the stimulus” should “we achieve what the 19 of us forecast,” Fisher said today. Big Ben last week said the FED may start slowing the pace of its bond-buying program later this year & end it entirely around mid-2014 if the economy gets on a path of sustainable growth. Fisher has been among the most vocal critics within the Fed of the central bank’s unprecedented measures to bolster the economy. Investors shouldn’t overreact to the central bank’s plans to reduce the pace of asset purchases, Fisher said in an interview. Investors behaved like “feral hogs” after the Jun 19 comments by Bernanke, he said. US stocks retreated as Chinese equities entered a bear market amid concern a cash crunch & speculation increased that the US will begin curbing stimulus. “I’ve not been a fan of this program,” Fisher said today. The economy will need more incentives from fiscal policy makers to reach the point of full employment, he added. “What I wish to see is a marriage of prudent monetary policy with prudent fiscal policy,” he said. These words helped calm markets.
Fed’s Fisher Says He Backs Tapering QE as Economy Improves
Photo: Bloomberg
President Narayana Kocherlokta of the Federal Reserve Bank of Minneapolis said the central bank needs to set clearer guideposts for the outlook for record stimulus & commit to press on with monthly bond purchases at least until unemployment falls below 7%. “The committee’s communications have provided insufficient detail about how its policy strategy will play out when the recovery is more advanced,” Kocherlakota said. The market’s reaction to the Fed’s statement “so far is not a cause for concern,” Kocherlakota said after releasing his statement. If yields continue to stay higher, “that would be restrictive to economic conditions” & suppress both prices & employment. More words to keep everybody guessing about the next moves by the Fed.
Photo: Bloomberg
Apple, with the world's market cap, dipped below $400 for the first time since Apr as a glut of unsold iPhones, resulting in an analysts downgrade & lowering of the target price. Another firm said low morale is causing employee departures. The stock has retreated more than 40% from a record high in Sep amid concern that CEO Tim Cook has taken too long to deliver a new breakthrough product to help make up for stiffer iPhone competition. There are fears that retailers & wireless carriers have twice the normal levels of iPhone inventory. Forecasts are that AAPL sold about 20% fewer iPhones in H2 than forecast. The stock finished down 10+ ( (although above 400) & has a dismal chart.
Apple Falls Below $400 Amid IPhone Slump, Worker Exits
At midday, the markets found buyers who reduced early deep losses. But high volatility is back in the markets which will encourage nervous investors to sell. Dow had a range of 240 today. A midday rally faded in the last hour when the Dow lost 100. Those swings have not been seen since the ugly days 5 years ago. Dow remains almost 800 below the highs on May 28. This looks like another tough week for the markets.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
Treasury yields:
U.S. 3-month |
0.04% | |
U.S. 2-year |
0.39% | |
U.S. 10-year |
2.53% |
| CLQ13.NYM | Crude Oil Aug 13 | 95.25 |  1.56 (1.7%) |
Photo: Bloomberg
President Richard Fisher of the Federal Reserve Bank of Dallas President said he favors scaling back the Fed’s monthly bond-buying if the economy makes the kind of progress officials are currently expecting. “I agree fully with the chairman that we should dial back on the stimulus” should “we achieve what the 19 of us forecast,” Fisher said today. Big Ben last week said the FED may start slowing the pace of its bond-buying program later this year & end it entirely around mid-2014 if the economy gets on a path of sustainable growth. Fisher has been among the most vocal critics within the Fed of the central bank’s unprecedented measures to bolster the economy. Investors shouldn’t overreact to the central bank’s plans to reduce the pace of asset purchases, Fisher said in an interview. Investors behaved like “feral hogs” after the Jun 19 comments by Bernanke, he said. US stocks retreated as Chinese equities entered a bear market amid concern a cash crunch & speculation increased that the US will begin curbing stimulus. “I’ve not been a fan of this program,” Fisher said today. The economy will need more incentives from fiscal policy makers to reach the point of full employment, he added. “What I wish to see is a marriage of prudent monetary policy with prudent fiscal policy,” he said. These words helped calm markets.
Fed’s Fisher Says He Backs Tapering QE as Economy Improves
Photo: Bloomberg
President Narayana Kocherlokta of the Federal Reserve Bank of Minneapolis said the central bank needs to set clearer guideposts for the outlook for record stimulus & commit to press on with monthly bond purchases at least until unemployment falls below 7%. “The committee’s communications have provided insufficient detail about how its policy strategy will play out when the recovery is more advanced,” Kocherlakota said. The market’s reaction to the Fed’s statement “so far is not a cause for concern,” Kocherlakota said after releasing his statement. If yields continue to stay higher, “that would be restrictive to economic conditions” & suppress both prices & employment. More words to keep everybody guessing about the next moves by the Fed.
Photo: Bloomberg
Apple, with the world's market cap, dipped below $400 for the first time since Apr as a glut of unsold iPhones, resulting in an analysts downgrade & lowering of the target price. Another firm said low morale is causing employee departures. The stock has retreated more than 40% from a record high in Sep amid concern that CEO Tim Cook has taken too long to deliver a new breakthrough product to help make up for stiffer iPhone competition. There are fears that retailers & wireless carriers have twice the normal levels of iPhone inventory. Forecasts are that AAPL sold about 20% fewer iPhones in H2 than forecast. The stock finished down 10+ ( (although above 400) & has a dismal chart.
Apple Falls Below $400 Amid IPhone Slump, Worker Exits
Apple (AAPL)
At midday, the markets found buyers who reduced early deep losses. But high volatility is back in the markets which will encourage nervous investors to sell. Dow had a range of 240 today. A midday rally faded in the last hour when the Dow lost 100. Those swings have not been seen since the ugly days 5 years ago. Dow remains almost 800 below the highs on May 28. This looks like another tough week for the markets.
Dow Jones Industrials
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