Dow slipped 7, advancers ahead of decliners 2-1 & NAZ inched was up pocket changed. The Financial Index gained a fraction to the 191s, a new 6 month high.
The MLP index shot up 3+ to 399, a fresh record, & the REIT index was up 1+ to the 241s, a 6 month high. Junk bond funds were higher while Treasuries pulled back, taking the yield on the 10 year Treasury to almost 2.1%. Oil rose for the first time in 4 days as the EU agreed to ban oil imports from Iran. Buyers bid up gold prices on increased intl tensions, not to mention the continued Greek debt mess.
The EU imposed an oil embargo against Iran & froze assets of its central bank to pressure Iran into resuming talks on the country's controversial nuclear program. The measures include an immediate embargo on new contracts for crude oil & petroleum products. Existing contracts with Iran will be allowed to run until Jul. 80% of Iran's foreign revenue comes from oil exports & sanctions could hit its economy hard. With 4M barrels per day, Iran is the 2nd largest producer in OPEC. Iran is already under several rounds of UN sanctions for not being more forthcoming about its nuclear program. Meanwhile, 2 Iranian lawmakers stepped up threats that their country would close the strategic Strait of Hormuz, through which a 1/5 of the world's crude flows, in retaliation. Tensions over the strait & the potential impact of its closure have weighed heavily on consumers & traders. The US has enacted, but not yet put into force, sanctions targeting Iran's central bank its ability to be paid for its oil. Iran is unpredictable, this tense situation has to be watched closely.
Germany & France pressed for a rapid deal between Greece & its private creditors that returns its soaring debt to sustainable levels & remained committed to a new bailout by Mar. Euro zone finance ministers are due to decide later on Mon what terms of a Greek debt restructuring they are ready to accept as part of a 2nd rescue package. One minister said a deal appeared to be "taking shape." I've heard that before. There are also doubters, saying "The negotiations will be difficult, but we want the second program for Greece to be implemented in March so that the second tranche can be released." Details of the debt restructuring, which will involve swapping existing Greek bonds for new, longer-term bonds, remain unresolved.
Halliburton net income spiked 50% in Q4 as it shifted its focus from natural gas to oil. Energy companies are capitalizing on new technology to reach crude that was once prohibitively expensive to pump, especially in the US & HAL has benefited immensely. EPS was 98¢, up from 66¢ last year. Excluding a $15M charge for an "environmental-related matter," EPS was $1.00 & revenue increased 37% to $7.06B. The boom in shale drilling across regions of North America boosted EPS to $3.08 for 2011, compared with $2.02 in 2010. Revenue increased 38% to $24.8B. Hydraulic fracturing, still a relatively new technology, has allowed energy companies to get to oil and natural gas from fields that had been left behind with most of the remaining resources trapped in shale rock. HAL uses a mix of highly pressurized water & chemicals to break apart shale formations & free the resources contained within. "We are proactively moving equipment from dry natural gas to liquids plays in North America in response to recent rig moves," Halliburton CEO Lesar said." The stock fell 1.04 (3%).
Halliburton rides oil boom to 4Q profit AP
Italian & Spanish bonds gained on speculation today the EU will make progress on measures to help resolve the European debt mess. Good luck. The negotiations in Greek about the haircut bond holders would take was supposed to be wrapped up over the weekend. They'll try again today. The favorable earnings report for HAL may be helping MLPs which are building more infrastructure to move domestic oil supplies. More distribution increases will be announced in the next 2 weeks. This should also be a big week for earnings reports, followed by div increases next month from the strongest. Dow is still about 100 below its highs in late Jul, an important barrier.
The MLP index shot up 3+ to 399, a fresh record, & the REIT index was up 1+ to the 241s, a 6 month high. Junk bond funds were higher while Treasuries pulled back, taking the yield on the 10 year Treasury to almost 2.1%. Oil rose for the first time in 4 days as the EU agreed to ban oil imports from Iran. Buyers bid up gold prices on increased intl tensions, not to mention the continued Greek debt mess.
JPMorgan Chase Capital XVI (AMJ)
Treasury yields:
U.S. 3-month | 0.041% | |
U.S. 2-year | 0.238% | |
U.S. 10-year | 2.069% |
| CLH12.NYM | ...Crude Oil Mar 12 | ...99.51 | ... 1.18 | (1.2%) |
| GCF12.CMX | ...Gold Jan 12 | ......1,672.70 | ..... 9.00 | (0.5%) |
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The EU imposed an oil embargo against Iran & froze assets of its central bank to pressure Iran into resuming talks on the country's controversial nuclear program. The measures include an immediate embargo on new contracts for crude oil & petroleum products. Existing contracts with Iran will be allowed to run until Jul. 80% of Iran's foreign revenue comes from oil exports & sanctions could hit its economy hard. With 4M barrels per day, Iran is the 2nd largest producer in OPEC. Iran is already under several rounds of UN sanctions for not being more forthcoming about its nuclear program. Meanwhile, 2 Iranian lawmakers stepped up threats that their country would close the strategic Strait of Hormuz, through which a 1/5 of the world's crude flows, in retaliation. Tensions over the strait & the potential impact of its closure have weighed heavily on consumers & traders. The US has enacted, but not yet put into force, sanctions targeting Iran's central bank its ability to be paid for its oil. Iran is unpredictable, this tense situation has to be watched closely.
Germany & France pressed for a rapid deal between Greece & its private creditors that returns its soaring debt to sustainable levels & remained committed to a new bailout by Mar. Euro zone finance ministers are due to decide later on Mon what terms of a Greek debt restructuring they are ready to accept as part of a 2nd rescue package. One minister said a deal appeared to be "taking shape." I've heard that before. There are also doubters, saying "The negotiations will be difficult, but we want the second program for Greece to be implemented in March so that the second tranche can be released." Details of the debt restructuring, which will involve swapping existing Greek bonds for new, longer-term bonds, remain unresolved.
Halliburton net income spiked 50% in Q4 as it shifted its focus from natural gas to oil. Energy companies are capitalizing on new technology to reach crude that was once prohibitively expensive to pump, especially in the US & HAL has benefited immensely. EPS was 98¢, up from 66¢ last year. Excluding a $15M charge for an "environmental-related matter," EPS was $1.00 & revenue increased 37% to $7.06B. The boom in shale drilling across regions of North America boosted EPS to $3.08 for 2011, compared with $2.02 in 2010. Revenue increased 38% to $24.8B. Hydraulic fracturing, still a relatively new technology, has allowed energy companies to get to oil and natural gas from fields that had been left behind with most of the remaining resources trapped in shale rock. HAL uses a mix of highly pressurized water & chemicals to break apart shale formations & free the resources contained within. "We are proactively moving equipment from dry natural gas to liquids plays in North America in response to recent rig moves," Halliburton CEO Lesar said." The stock fell 1.04 (3%).
Halliburton rides oil boom to 4Q profit AP
Halliburton Company (HAL)
Italian & Spanish bonds gained on speculation today the EU will make progress on measures to help resolve the European debt mess. Good luck. The negotiations in Greek about the haircut bond holders would take was supposed to be wrapped up over the weekend. They'll try again today. The favorable earnings report for HAL may be helping MLPs which are building more infrastructure to move domestic oil supplies. More distribution increases will be announced in the next 2 weeks. This should also be a big week for earnings reports, followed by div increases next month from the strongest. Dow is still about 100 below its highs in late Jul, an important barrier.
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