Dow climbed back from early losses to a gain of 7, advancers over decliners 4-3 & NAZ added 22. The MLP index pulled back 1+ to 463 & the REIT index jumped 2+ to 278. Junk bond funds rose while Treasuries hardly budged. Oil snuck back over 100 & gold moved higher with its eyes on 1300.
AMJ (Alerian MLP Index tracking fund)
![Live 24 hours gold chart [Kitco Inc.]](http://www.kitco.com/images/live/gold.gif)
House Rep leaders are preparing a proposal to extend the debt limit past the Nov 4 election later today. But they want policy changes in exchange for raising the debt limit, though they’ve been unable to agree on exactly what. A proposal to restore cost-of-living adjustments for military retirees, which were cut in a Dec budget deal, is emerging as the preferred option. Another option is averting cuts in doctors’ Medicare payments. Treasury Secretary Jacob Lew last week urged Congress to raise the debt ceiling as soon as possible, saying borrowing authority may not last past Feb 27. Including today, the lawmakers have just 6 working days scheduled before then. Business groups are encouraging them to raise the debt limit. “Any default by the federal government on its debts would cause devastating, long-lasting effects for all Americans,” the Business Roundtable, representing major company CEOs, said on Fri. The Financial Services Forum, the American Bankers Association & 7 other groups sent a letter to lawmakers on Jan 30, warning that the last debt-ceiling deadline debate caused higher interest rates & “weakened investor demand for U.S. assets.” House Majority Leader Eric Cantor’s schedule for votes for this week includes possible consideration of legislation related to the debt limit. But no bill has been introduced. Senate Dems, who insist on a debt-limit increase without conditions, aren’t embracing the effort by Reps.
Republicans Focusing on Debt-Limit Boost Past Nov. 4 Vote
The extra cost to borrow for China's riskiest companies is at the highest in 20 months as soaring interest rates heighten concern the nation will experience its first onshore bond default. The yield gap on 5 year AA- notes over AAA debt jumped 27 basis points last month to 224, the most since Jun 2012. Ratings of AA- or below are equivalent to non-investment grades globally. The similar spread in the US is 403 basis points. The failure of coal companies to meet payment deadlines for trust products has increased concern over debt defaults, with the equivalent of $53B of bonds sold by renewable energy, construction materials, metals & mining companies due in 2014. A report 2 weeks ago signaled China’s factories are contracting for the first time since Aug amid signs of financial stress including mounting losses and bailouts. Chinese economic growth slowed in Q4 to 7.7% from 7.8% in Q3 as Premier Li Keqiang drove up money-market rates to encourage companies & local govs to deleverage. The central bank signaled in a Feb. 8 report that volatility in money-market interest rates will persist & borrowing costs will rise, further underscoring the risk of defaults which could weigh on confidence & drag down growth. China Credit Trust reached an agreement last month to repay bailed-out investors in a high-yield product whose threatened failure spurred concern bad debts will rise in the nation’s $1.7T trust industry.
Junk Yield Premiums Soar on Looming First Default: China Credit
American Express, a Dow stock, climbed as analysts recommended buying after the firm forecast a jump in small businesses that accept its products. AXP will allow 3rd-party merchant acquirers to contract directly with small businesses that have less than $1M of annual charge volume, the lender said last Wed. Now it will assign a rate to acquirers, who then will set pricing for merchants. As part of the new program, OptBlue, AXP forecasts small-merchant acquisitions to increase at least 50% annually starting in 2015. “Our goal is to dramatically accelerate the signing of new merchants coming on to accept American Express over the next couple of years,” President Ed Gilligan said. “This has been an evolution of our strategy.” The stock jumped 1.36.
If you would like to learn more about AXP, click on this link:
http://club.ino.com/trend/?symb=AXP&a_aid=CD3289&a_bid=6ae5b6f7
AmEx Climbs as Analysts Praise Plan to Lure Small Merchants
Traders were twiddling there thumbs today with little to do. Janet Yellen gives her first testimony tomorrow which will gives clues about the direction of the Federal Reserve bond buying program. Dramatic changes are not expected, but her every word will be weighed. The financial goings on in China deserve more attention. This has become a huge economy & all is not well. Slower growth hurts & the threat of a major financial collapse has been raised. Even small problems there will be felt around the world.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
BONDS
U.S. 3-month |
0.06% | |
U.S. 2-year |
0.31% | |
U.S. 10-year |
2.68% |
| CLH14.NYM | ....Crude Oil Mar 14 | ....100.15 |  ...0.27 | (0.3%) |
House Rep leaders are preparing a proposal to extend the debt limit past the Nov 4 election later today. But they want policy changes in exchange for raising the debt limit, though they’ve been unable to agree on exactly what. A proposal to restore cost-of-living adjustments for military retirees, which were cut in a Dec budget deal, is emerging as the preferred option. Another option is averting cuts in doctors’ Medicare payments. Treasury Secretary Jacob Lew last week urged Congress to raise the debt ceiling as soon as possible, saying borrowing authority may not last past Feb 27. Including today, the lawmakers have just 6 working days scheduled before then. Business groups are encouraging them to raise the debt limit. “Any default by the federal government on its debts would cause devastating, long-lasting effects for all Americans,” the Business Roundtable, representing major company CEOs, said on Fri. The Financial Services Forum, the American Bankers Association & 7 other groups sent a letter to lawmakers on Jan 30, warning that the last debt-ceiling deadline debate caused higher interest rates & “weakened investor demand for U.S. assets.” House Majority Leader Eric Cantor’s schedule for votes for this week includes possible consideration of legislation related to the debt limit. But no bill has been introduced. Senate Dems, who insist on a debt-limit increase without conditions, aren’t embracing the effort by Reps.
Republicans Focusing on Debt-Limit Boost Past Nov. 4 Vote
The extra cost to borrow for China's riskiest companies is at the highest in 20 months as soaring interest rates heighten concern the nation will experience its first onshore bond default. The yield gap on 5 year AA- notes over AAA debt jumped 27 basis points last month to 224, the most since Jun 2012. Ratings of AA- or below are equivalent to non-investment grades globally. The similar spread in the US is 403 basis points. The failure of coal companies to meet payment deadlines for trust products has increased concern over debt defaults, with the equivalent of $53B of bonds sold by renewable energy, construction materials, metals & mining companies due in 2014. A report 2 weeks ago signaled China’s factories are contracting for the first time since Aug amid signs of financial stress including mounting losses and bailouts. Chinese economic growth slowed in Q4 to 7.7% from 7.8% in Q3 as Premier Li Keqiang drove up money-market rates to encourage companies & local govs to deleverage. The central bank signaled in a Feb. 8 report that volatility in money-market interest rates will persist & borrowing costs will rise, further underscoring the risk of defaults which could weigh on confidence & drag down growth. China Credit Trust reached an agreement last month to repay bailed-out investors in a high-yield product whose threatened failure spurred concern bad debts will rise in the nation’s $1.7T trust industry.
Junk Yield Premiums Soar on Looming First Default: China Credit
American Express, a Dow stock, climbed as analysts recommended buying after the firm forecast a jump in small businesses that accept its products. AXP will allow 3rd-party merchant acquirers to contract directly with small businesses that have less than $1M of annual charge volume, the lender said last Wed. Now it will assign a rate to acquirers, who then will set pricing for merchants. As part of the new program, OptBlue, AXP forecasts small-merchant acquisitions to increase at least 50% annually starting in 2015. “Our goal is to dramatically accelerate the signing of new merchants coming on to accept American Express over the next couple of years,” President Ed Gilligan said. “This has been an evolution of our strategy.” The stock jumped 1.36.
If you would like to learn more about AXP, click on this link:
http://club.ino.com/trend/?symb=AXP&a_aid=CD3289&a_bid=6ae5b6f7
AmEx Climbs as Analysts Praise Plan to Lure Small Merchants
American Express (AXP)
Traders were twiddling there thumbs today with little to do. Janet Yellen gives her first testimony tomorrow which will gives clues about the direction of the Federal Reserve bond buying program. Dramatic changes are not expected, but her every word will be weighed. The financial goings on in China deserve more attention. This has become a huge economy & all is not well. Slower growth hurts & the threat of a major financial collapse has been raised. Even small problems there will be felt around the world.
Dow Jones Industrials
I’m a huge fan of INO & from what I have seen so far, their service Marketclub! This isn’t a stripped down version, everything in MarketClub is available to you. I don’t want to give everything away, but you’ll have unlimited access to my favorite3 tools: Trade Triangles, Smart Scan & Alerts!
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I’d recommend you jump on this now.
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