Dow lost 38, decliners barely ahead of advancers & NAZ slipped 3. The Financial Index was flat, near 293. The MLP index jumped 4+ to the 449s & the REIT index was up 1 to 293. Junk bond funds were mixed & there was selling in Treasuries. Oil was higher while gold pulled back.
AMJ (Alerian MLP Index tracking fund)
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Cyprus is no longer center stage because it has agreed to a €10B bailout with its euro zone partners & the IMF. A visible bank run has been averted by stringent capital controls. Intl markets, which only ever suffered a mild bout of jitters, have calmed down. But problems remain. The island is edging towards euro exit. Quitting the single currency would devastate wealth, fuel inflation, lead to default & leave Cyprus friendless in a troubled neighborhood. Even so, the longer capital controls continue, the louder the voices calling for bringing back the Cyprus pound will grow. President Nicos Anastasiades is against Cyprus leaving the euro zone. But the main opposition communist party wants to pull out. A smaller opposition group wants to stay in the euro but kick out the troika (European Commission, the ECB & the IMF). The country's influential archbishop is also critical of the troika. Anastasiades can hold the line for now. He has just been elected & the constitution gives him huge power. What's more, there are strong arguments for staying inside the single currency, not least the fact that, otherwise, it would lose the €10B (nearly 60% of GDP) of bailout money. If Nicosia brought back the Cyprus pound, it would plummet in value & nobody knows how.
Photo: Yahoo
Greek banks NBG & Eurobank saw their stocks plunge 30%, the maximum allowed in a day, after their planned merger was postponed & fears grew they may be nationalized. National Bank of Greece & Eurobank announced that the merger process had been "suspended" as the 2 banks have to first raise money in a nation-wide program meant to strengthen the country's financial system. Both have said they are unable to raise the cash, suggesting they may face nationalization. NBG needs almost €10B ($12.6B) & Eurobank needs almost €6B ($7.6B) to meet solvency criteria set by the central bank. Since the banks cannot raise any of the money themselves, the Hellenic Financial Stability Fund, Greece's bailout facility for the banks, will have to provide it for them & the fund would essentially take control of the banks, a prospect that has spooked shareholders. The governing boards of the NBG and Eurobank were to hold meetings Tuesday.
Greek bank stocks plunge after merger stalled AP
Avon is eliminating more than 400 positions & abandoning or restructuring smaller or underperforming businesses in Africa, the Middle East & Europe, including an exit from Ireland. Job cuts, which will equate to about 1% of employees, will occur across all regions & segments. It is part of a turnaround plan under CEO Sheri McCoy, with the goal of achieving mid-single digit percentage revenue growth & $400M in cost savings by 2016. Almost all the cuts are expected before year's end. The will take charges of around $35-$40M before taxes & expects annualized savings of between $45-$50M. McCoy, who became CEO last year, announced in Dec that the company would leave Vietnam & South Korea & that it would cut 1500 jobs in all. In its most recent qtr, it posted a wider loss as it marked down the value of its Silpada jewelry business & restructured. The stock was up a penny.
Avon to Eliminate 400 Jobs, Leave Ireland in Cost Cut Plan
Stocks don't know where to go after the sell-off on Fri. The employment news disappointed the markets & earnings season which begins tonight will get more attention then usual. Alcoa (AA), a Dow stock, reports tonight & analysts are looking for EPS of 53¢, up sharply from last year's 24¢. In the next few days the big banks will report. Federal budget cuts are being felt & comments from companies about their effect will be interesting.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
Treasury yields:
U.S. 3-month |
0.063% | |
U.S. 2-year |
0.232% | |
U.S. 10-year |
1.712% |
| CLK13.NYM | ...Crude Oil May 13... | 93.10 |  ...0.40 | (0.4%) |
| GCK13.CMX | ...Gold May 13 | .....1,575.00 | ...0.50 | (0.0%) |
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Cyprus is no longer center stage because it has agreed to a €10B bailout with its euro zone partners & the IMF. A visible bank run has been averted by stringent capital controls. Intl markets, which only ever suffered a mild bout of jitters, have calmed down. But problems remain. The island is edging towards euro exit. Quitting the single currency would devastate wealth, fuel inflation, lead to default & leave Cyprus friendless in a troubled neighborhood. Even so, the longer capital controls continue, the louder the voices calling for bringing back the Cyprus pound will grow. President Nicos Anastasiades is against Cyprus leaving the euro zone. But the main opposition communist party wants to pull out. A smaller opposition group wants to stay in the euro but kick out the troika (European Commission, the ECB & the IMF). The country's influential archbishop is also critical of the troika. Anastasiades can hold the line for now. He has just been elected & the constitution gives him huge power. What's more, there are strong arguments for staying inside the single currency, not least the fact that, otherwise, it would lose the €10B (nearly 60% of GDP) of bailout money. If Nicosia brought back the Cyprus pound, it would plummet in value & nobody knows how.
- Cyprus Edges Towards Euro Exit Reuters
Photo: Yahoo
Greek banks NBG & Eurobank saw their stocks plunge 30%, the maximum allowed in a day, after their planned merger was postponed & fears grew they may be nationalized. National Bank of Greece & Eurobank announced that the merger process had been "suspended" as the 2 banks have to first raise money in a nation-wide program meant to strengthen the country's financial system. Both have said they are unable to raise the cash, suggesting they may face nationalization. NBG needs almost €10B ($12.6B) & Eurobank needs almost €6B ($7.6B) to meet solvency criteria set by the central bank. Since the banks cannot raise any of the money themselves, the Hellenic Financial Stability Fund, Greece's bailout facility for the banks, will have to provide it for them & the fund would essentially take control of the banks, a prospect that has spooked shareholders. The governing boards of the NBG and Eurobank were to hold meetings Tuesday.
Greek bank stocks plunge after merger stalled AP
Avon is eliminating more than 400 positions & abandoning or restructuring smaller or underperforming businesses in Africa, the Middle East & Europe, including an exit from Ireland. Job cuts, which will equate to about 1% of employees, will occur across all regions & segments. It is part of a turnaround plan under CEO Sheri McCoy, with the goal of achieving mid-single digit percentage revenue growth & $400M in cost savings by 2016. Almost all the cuts are expected before year's end. The will take charges of around $35-$40M before taxes & expects annualized savings of between $45-$50M. McCoy, who became CEO last year, announced in Dec that the company would leave Vietnam & South Korea & that it would cut 1500 jobs in all. In its most recent qtr, it posted a wider loss as it marked down the value of its Silpada jewelry business & restructured. The stock was up a penny.
Avon to Eliminate 400 Jobs, Leave Ireland in Cost Cut Plan
Avon Products (AVP)
Stocks don't know where to go after the sell-off on Fri. The employment news disappointed the markets & earnings season which begins tonight will get more attention then usual. Alcoa (AA), a Dow stock, reports tonight & analysts are looking for EPS of 53¢, up sharply from last year's 24¢. In the next few days the big banks will report. Federal budget cuts are being felt & comments from companies about their effect will be interesting.
Dow Jones Industrials
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