Sense on Cents

I will spare you the fact that the drama playing out in Greece is likely to have a tragic ending. I will do the same in terms of housing and labor in our nation. Let’s focus on the positives which reside in the bubbling waters of a variety of market sectors. Are the bubbles intoxicating? You bet they are. Remember, though, do not drink and drive!!

Welcome to our Sense on Cents Week in Review where I provide a streamlined recap of the major economic data and news, along with month-to-date market returns.

ECONOMIC DATA
1. ISM Non-Manufacturing Index: rebounds to 55.4, an indication that activity outside of manufacturing is picking up.

2. Consumer Credit: declined significantly. How far? Try $11.5 billion versus a consensus expectation of a flat reading. The consumer is rebounding? Don’t think so!! (Please review “How Can Rick Davis Predict 2nd Qtr GDP of -1.5%?” for more on consumer driven activity).

3. Jobless Claims: increased 18k back to the 460k level. I thought the Obama administration was focused on job growth? Oh well . . .

I need some bubbly, so . . .

Let’s move along to MARKET DATA. The stats provided are the week’s close (April 9th), March close, and the percentage change:

U.S. DOLLAR
$/Yen: 93.15 vs 93.46, -.3%
Euro/Dollar: 1.3493 vs 1.3509, -0.1%
U.S. Dollar Index: 80.90 vs 81.07, -.2%

Commentary: the overall U.S. Dollar Index has largely been running in place for the last few weeks despite ongoing problems in the Euro-zone.

COMMODITIES
Oil: $84.99/barrel vs $83.30, +2.0%
Gold: $1161.7/oz. vs $1113.7, +4.3%
Copper: $3.589 vs $3.550, +1.1%
DJ-UBS Commodity Index: 134.73 vs 132.15, +2.0%

Commentary: commodities, in general, have rebounded over the course of the last few weeks. The leaders have been copper, oil and gold. These price movements, however, are not reflected by an uptick in the Baltic Dry Index. The BDI has actually declined by close to 20% over the last month. Hmmmmm. The DJ-UBS Commodity Index is now down approximately 3.2% on the year as prices of a variety of food products have declined while the ‘black gold’ (that being oil), the shiny yellow stuff itself, and copper are all up, with copper the big winner.

EQUITIES
DJIA: 10,997 vs 10,856 +1.3%
Nasdaq: 2454 vs 2398,+2.3%
S&P 500: 1194 vs 1169, +2.1%
MSCI Emerging Mkt Index: 1036 vs 1009, +2.7%
DJ Global ex U.S.: 208.3 vs 204, +2.1%

Commentary: why are equities up? Because Ben Bernanke wants them to be up…any other questions? Do you believe the Red Sox blew another game last night? Oh, yeah…equities? Yep, it’s all what Big Ben wants and he has the biggest checkbook so he gets what he wants. Don’t worry, be happy. Want a little more bubbly? Overall volumes do remain very light.

BONDS/INTEREST RATES

2yr Treasury: 1.06% vs 1.02%, +4 basis points or -.04%
10yr Treasury: 3.88% vs 3.83%, +5 basis points or -05%
COY (High Yield): 6.88 vs 6.77 +1.6%
FMY (Mortgage): 18.36 vs 18.39, -.2%
ITE (Government): 57.32 vs 57.52, –0.35%
NXR (Municipal): 14.27 vs 14.22, +.3%

Commentary: 10yr Treasury rates briefly touched 4.0% early in the week, but then rallied on concerns of problems in Greece specifically and the EU in general. The bond market also benefited from the decline in consumer credit and the increase in jobless claims. Funny how those figures did not impact the equity markets, but remember…what Big Ben wants, Big Ben gets. DON’T FIGHT the FED and DO NOT LOOK for the FED to INCREASE INTEREST RATES anytime soon. The bubbly will likely keep flowing!!

SUMMARY/CONCLUSION
The roller coaster continues in terms of the economic data, but the bubbly within the markets is absolutely intoxicating. Do you need a ride home?

In regard to my ongoing pursuit of truth, transparency, and integrity on our economic landscape, please join me this Sunday evening (8-9pm EST) for what will be a fascinating discussion. No Quarter Radio’s Sense on Cents with Larry Doyle Welcomes 13 Bankers Co-Author James Kwak. We will discuss that if banks are ‘too big to fail’ then ‘make them smaller.’ 13 Bankers is on its way to the top of all the charts. This weekend’s show is a must listen.

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Have a great day and weekend.

LD

This entry was posted on Saturday, April 10th, 2010 at 8:30 AM and is filed under General, markets. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.