Archive for March, 2010

Stocks: Strong quarter ends with a loss - CNNMoney.com -- Stocks ended lower Wednesday, but higher for the quarter after a strong showing in March, as downbeat jobs and manufacturing reports cooled a recent runup.

The Dow Jones industrial average lost 50 points, or 0.5%, to end at 10,857.31. The S&P 500 index slipped 4 points, or 0.3%. The Nasdaq composite lost 7 points, or 0.3%.

Wall Street reached the end of a solid quarter, even with Wednesday's losses. The Dow gained 4.1% over the first three months of the year, after a 5.2% advance in March, while the S&P added 4.9% for the quarter. The tech-heavy Nasdaq had the strongest quarterly showing, up 5.7%.

Treasurys rise on weak jobs data - CNNMoney.com -- Treasurys rose Wednesday after a report showed an unexpected decline in jobs, pushing investors to pull back on riskier assets and turn to the safety of government debt.

What prices are doing: The benchmark 10-year note rose 8/32 to 98-11/32, driving the yield down to 3.83% from 3.86% late Tuesday. Bond prices and yields move in opposite directions.  The 30-year bond rose 14/32 to 98-20/32 with a yield of 4.72%. The 5-year note edged up 17/32 to 99-25/32 with a yield of 2.56%. The 2-year note edged up 21/32 to 99-31/32 with a yield of 1.02%.

Private sector continues to shed jobs - Private-sector employers continued to cut jobs in March, highlighting the challenges still facing the nation's job market, according to a report released Wednesday.

Automatic Data Processing, which processes paychecks for one in every six U.S. employees, said private-sector employers cut payrolls by 23,000 jobs in March, marking the smallest monthly decline since February 2008.

The decline surprised many economists. A consensus of economists surveyed by Briefing.com had forecast a gain of 40,000 jobs in the month.
The number of job cuts in February was revised to a loss of 24,000 jobs from the previously reported 20,000.
"American businesses are on the cusp of recovery, yet this report shows that they remain hesitant to increase their payrolls," Gary Butler, chief executive of ADP, said in a statement.

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Dow carves out new 18-month high - CNNMoney.com -- The Dow Jones industrial average ended at a fresh 18-month high and the rest of the market churned Tuesday as investors weighed a rise in consumer confidence, more weakness in the housing market and a stronger dollar.

The Dow Jones industrial average added 11 points, or 0.1%, closing at 10,907.42, the highest finish since 11,143.13 on Sept. 26, 2008. The S&P 500 index was little changed. The Nasdaq composite added 6 points, or 0.3%.

30 days and counting: Homebuyer tax credit expires - Attention shoppers: You have barely a month left before the homebuyer tax credit expires. But depending on where you live, you might not want to rush out to buy.

First-time homebuyers may qualify for up to $8,000, while those who are trading up could get as much as $6,500. But either way, buyers have to ink sales contracts by the end of April and close before July 1 to see the refund.

And this is absolutely, positively your last chance to claim the credit (Probably.) So don't wait, thinking the credit will be extended for a third time.

Home price dip extends to 4th month - CNNMoney.com -- The market seems to have pulled the rug out from under housing industry hopes for a sustained early recovery.

After a five-month run-up in home prices starting last spring, prices have now fallen for four consecutive months, according to the S&P/Case-Shiller Home Price Index of 20 cities, a gauge of market values, released Tuesday.
In January, prices were down 0.4%, compared with December and have fallen 0.7% from a year earlier.

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Dow at new 18-month highs - CNNMoney.com -- Stocks gained Monday, pushing the Dow to its highest point in a year-and-a-half, after a report showing a rise in consumer spending added to bets about the strength of the economic recovery.

The Dow Jones industrial average added 45 points, or 0.4%, ending at 10,895.86, the highest point since Sept. 26, 2008, when it closed at 11,143.13. The S&P 500 index gained 7 points, or 0.6%. The Nasdaq composite rose 9 points, or 0.4%.

The first quarter ends Wednesday and currently the Dow is up 4%, the S&P 500 is up 4.6% and the Nasdaq is up 5.6%. When stocks have had a positive quarter, end-of-quarter machinations tend to be positive, as managers look to play catch up.

Treasurys fall on lower demand - CNNMoney.com -- Treasury prices continued to fall Monday following tepid auctions last week.

What prices are doing: The benchmark 10-year note fell 17/32 to 97-21/32 and its yield rose to 3.87%. The 30-year bond fell 27/32 to 97-6/32 with a yield of 4.78%. Bond prices and yields move in opposite directions. The 5-year note fell 13/32 to 99-5/32 with a yield of 2.61%. The 2-year note fell 20/32 to 99-9/32 with a yield of 1.06%.

What's moving the market: Consumer spending and income numbers released by the Commerce Department Monday came in as expected, and weren't major market movers. Personal spending rose for a fifth straight month in February, while personal income was virtually unchanged. Stocks posted modest gains in wake of the news.

Meanwhile, Treasury prices continued to fall, driving yields higher, after government auctions of $118 billion in notes last week saw lackluster demand. Given the flood of Treasurys that the government has issued over the last several months to fund U.S. debt, analysts have been predicting that investors will eventually begin demanding higher yields.

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Stocks Abandon Rally -  CNNMoney.com -- Stocks gave up gains Thursday, ending little changed, as a late-session bounce in the dollar sapped the strength out of a rally that had pushed the Dow, S&P 500 and Nasdaq near new 18-month highs.

The Dow Jones industrial average added 5 points, or less than 0.1%. Earlier it had risen as much as 119 points, to within 46 points of 11,000, before giving back most of those gains. The S&P 500 index lost 2 points, or 0.2%. The Nasdaq composite was little changed.

Long-term Treasurys continue loosing streak - CNNMoney.com -- Long-term Treasurys continued to fall Thursday after the last of three auctions totaling $118 billion this week.

What prices are doing: The benchmark 10-year note fell 11/32 to 97-25/32, driving the yield up to 3.9%. The 30-year bond fell 17/32 to 97-24/32 with a yield of 4.77%. Bond prices and yields move in opposite directions. The 5-year note gained 8/32 to 99-8/32 with a yield of 2.67%. The 2-year note was little changed at 99-26/32 with a yield of 1.11%.

What's moving the market: Thursday's auction of 7-year notes marked the last of this week's three government auctions issuing new supply of U.S. debt to fund the country's budget deficit.

Jobless claims slide - The number of Americans filing first-time claims for unemployment insurance fell last week to the lowest level in six weeks, the government said Thursday.

There were 442,000 initial jobless claims filed in the week ended March 20, down 14,000 from a revised 456,000 the previous week, according to a weekly report from the Labor Department.

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Stocks slip on Portugal credit woes - CNNMoney.com -- Stocks closed lower Wednesday as the dollar strengthened on fears tied to the growing fiscal crisis in Europe and a dour report on U.S. sales of new homes raised concerns about the economic recovery.

The Dow Jones industrial average fell 53 points, or 0.5%. The S&P 500 index slid 6 points, or 0.5%. The Nasdaq composite dropped 16 points, or 0.7%. All three indexes remain near the highest levels since late September 2008.

Stocks opened lower after ratings agency Fitch cut Portugal's sovereign credit rating one notch, reigniting concerns that the debt problems of struggling European economies like Greece are spreading and could hurt stronger members of the European Union.

The downgrade battered the euro, which fell to a 10-month low versus the dollar. The stronger greenback weighed on commodity prices, driving oil down 1.7%.

Stocks were also pressured by weaker-than-expected reports on new-home sales and durable goods orders. But analysts said the data are consistent with an economic recovery, albeit an uneven one.

Bank of America to cut some mortgage balances - Bank of America announced Wednesday that it will first look at reducing the loan balances of certain distressed homeowners with subprime or adjustable rate mortgages to make their payments more affordable.

The move makes Bank of America one of the first major loan servicers to systematically incorporate the controversial loan modification technique into its home retention program. Financial institutions, as well as the Obama administration, have come under increasing pressure in recent months to add principal reduction to their foreclosure prevention efforts.

Treasurys drop after auctions - CNNMoney.com -- Treasury prices continued falling on Wednesday after the latest auction of government debt.

What prices are doing: The benchmark 10-year note fell 1-7/32 to 98-9/32 and its yield rose to 3.84%. The 30-year bond fell 1-29/32 to 98-12/32 with a yield of 4.73%. Bond prices and yields move in opposite directions. The 5-year note fell 24/32 to 99-2/32 with a yield of 2.58%. The 2-year note was flat at 99-26/32 with a yield of 1.1%.

What's moving the market: U.S. debt prices fell after a $44 billion issue of 2-year notes on Tuesday and continued to fall after an auction of 5-year notes on Wednesday.

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Stocks surge to 18-month highs - CNNMoney.com -- Stocks rallied Tuesday, with the Dow, Nasdaq and S&P 500 ending at new 18-month highs following the release of a better-than-expected existing home sales report that suggests a slow economic rebound.

The Dow Jones industrial average rose 103 points, or 1%, ending at 10,888.83, the highest close since 11,143.13 on Sept. 26, 2008. The S&P 500 index gained eight points, or 0.7%, and ended at 1,174.17, its highest close since 1,213.09 on Sept. 26, 2008. The Nasdaq composite rose 20 points, or 0.8%, ending at 2,415.24, its highest close since 2,416.98 on Aug. 18, 2008.

Stocks initially struggled out of the gate Tuesday but turned higher following the release of the housing report, which showed existing home sales fell in February from January levels but still topped estimates.

Existing home sales slip in February - CNNMoney.com -- Sales of existing homes fell slightly in February, according to an industry report released Tuesday, a sign that the housing market's recovery remains fragile.

The National Association of Realtors reported that home resales fell 0.6% last month to a seasonally adjusted annual rate of 5.02 million units. That's down from a rate of 5.05 million in January. Still, sales are 7% higher than in February 2009, when homes were going into contract at an annual rate of 4.69 million units. Last month's figures came in slightly above analyst expectations.

Treasurys fell after auction - CNNMoney.com -- Treasurys fell after a government auction of $44 billion in 2-year notes Tuesday, the first of three auctions totaling $118 billion this week.

What prices are doing: After the auction, the 2-year note was flat, but other Treasurys fell. The 2-year closed at 99-26/32 with a yield of 0.99%. The 5-year note fell 2/32 to 99-25/32 and its yield rose to 2.42%. Bond prices and yields move in opposite directions.
The benchmark 10-year note fell 8/32 to 99-16/32 and its yield rose yield of 3.69%. The 30-year bond fell 17/32 to 100-10/32 with a yield of 4.60%.

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Dow at 18-Month High - CNNMoney.com -- Stocks gained Monday, with health care shares leading the way as Congressional approval of a sweeping reform bill removed the uncertainty that has surrounded its passage for months.

The Dow Jones industrial average rose 44 points, or 0.4%, ending at a fresh 18-month high. The S&P 500 index gained 6 points, or 0.5%, and closed just shy of the 18-month high hit last week. The Nasdaq composite gained 21 points, or 0.9%, closing at a more than 18-month high.

Treasurys rise after health care bill passes - CNNMoney.com -- U.S. debt prices rose Monday, after the House passed a historic health care bill the previous evening.
What prices are doing: The benchmark 10-year note rose 9/32 to 99-23/32 and its yield fell to 3.664%. The 30-year bond rose 4/32 to 100-27/32 and its yield fell to 4.63%. Bond prices and yields move in opposite directions.

HAMP Alternative Announced in Another Attempt to Reduce Foreclosures -  Fannie Mae has introduced another strategy to increase the effectiveness of the government foreclosure initiatives: The Alternative Modification Program

HAMP has been widely criticized for what has so far been a poor record of converting home mortgages entered into a required three month trial phase into permanent modifications.  As of the end of February HAMP (which also includes non-Fannie Mae and Freddie Mac mortgages) had finalized modifications on only 168,701 loans out of the 1.354 million who had been extended invitations to participate in the program.

Effective for mortgage loans in active HAMP trials initiated prior to March 1, 2010, servicers are now required to consider the Alternative Modification™ (Alt Mod™) prior to initiating foreclosure proceedings for those borrowers who were eligible for and accepted into a Home Affordable Modification Program (HAMP) trial period plan but were subsequently denied a permanent modification because of eligibility restrictions or failure to submit proper documentation. Servicers have maintained that borrowers were delaying or failing to provide the required documentation while borrowers and community groups have accused servicers of losing or mishandling the information.

Alt Mod eligibility criteria includes:

• The loan must have been evaluated and considered eligible for HAMP
• The HAMP trial period must have been initiated prior to March 1, 2010
• The loan must be secured by a one- to four-unit owner-occupied property
• The borrower must have made all required payments in accordance with a HAMP trial period plan, including subsequent payments that may have been due while the servicer attempted to convert the trial period to a permanent modification
• Any subsequent trial period payment(s) due from the borrower must be submitted prior to executing a permanent modification agreement

• The loan must have been evaluated and considered eligible for HAMP • The HAMP trial period must have been initiated prior to March 1, 2010 • The loan must be secured by a one- to four-unit owner-occupied property • The borrower must have made all required payments in accordance with a HAMP trial period plan, including subsequent payments that may have been due while the servicer attempted to convert the trial period to a permanent modification • Any subsequent trial period payment(s) due from the borrower must be submitted prior to executing a permanent modification agreement

Saying that contacting borrowers in a timely manner is key to the success of the Alt Mod program, the letter sets forth a schedule for contact and follow up which includes mail, phone and direct contact and a door-knocking campaign.  Servicers who fail to comply with the guidelines could lose their own incentive payments.

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Dow Win Streak Rises to 8 - CNNMoney.com -- Buying in select blue chips Thursday propelled the Dow to its eighth straight gain and the highest close in nearly 18 months, but the broader market churned as investors showed some reluctance after the recent rally.

The Dow Jones industrial average added 45 points, or 0.2%, ending at the highest point since Oct. 1, 2008. The Dow has now ended higher for eight straight sessions -- matching the winning streak that ended on Aug. 27 of last year.

The S&P 500 index ended just below unchanged after finishing the previous session at its highest point since Sept. 26, 2008. The Nasdaq composite added a few points and ended at the highest point since Aug. 28, 2008, nearly 19 months.

Treasurys Fall as Stocks Churn - CNNMoney.com -- Treasurys fell on Thursday as the stock market churned and as investors look ahead to the government's auction of $118 billion in notes next week.

What prices are doing: The benchmark 10-year note fell 9/32 to 99-20/32 and its yield rose to 3.68%. The 30-year bond fell 9/32 to 100-20/32 and its yield rose to 4.59%. Bond prices and yields move in opposite directions.

The 2-year note fell to 99-27/32 with a yield of 0.96%. The 5-year note fell to 99-27/32 with a yield of 2.42%.

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Stocks End at 18-Month Highs - CNNMoney.com -- Stocks rallied Wednesday, with the Dow, Nasdaq and S&P 500 all closing at new fresh 2010 highs, after the U.S. and Japanese central banks chose to keep interest rates low and the Senate passed a key jobs bill.

The Dow Jones industrial average added 48 points, or 0.6%, closing at 10,733.67. It was the highest close since 10,831.07 on Oct. 1, 2008. The Dow has now risen for seven sessions in a row, its longest winning streak since the 8-day period that ended on August 27 of last year.

The S&P 500 index rose 7 points, or 0.6%, closing at 1,166.21, the highest close since 1,213.01 on Sept. 26, 2008.

The Nasdaq composite gained 10 points, or 0.5%, closing at 2,389.09, its highest point since 2,411.64 on Aug. 28, 2008.

Treasury Gains Lackluster as Stocks Post 2010 Highs - CNNMoney.com -- Long-term Treasury markets inched up slightly Wednesday, a day after the Fed's announcement on interest rates. Fed policymakers revealed no surprises when they said they'll continue to keep the federal funds rate near 0% for an extended period.

What prices are doing: The benchmark 10-year note rose 4/32 to 99-29/32 and its yield fell to 3.64%. The 30-year bond rose 13/32 to 101 and its yield fell to 4.566%. Bond prices and yields move in opposite directions. The 2-year note fell was flat at 99-29/32 with a yield of 0.924%. The 5-year note fell 2/32 to 100-2/32 with a yield of 2.367%.

What's moving the market: Stocks gained after investors let the Fed's news -- or rather, lack of news -- soak in. Although the Fed decided to maintain historically low interest rates, the central bank also noted that the U.S. economy is improving.

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Stocks Rise After Fed Holds Rates - CNNMoney.com -- Stocks closed higher Tuesday after the Federal Reserve voted to keep interest rates at historic lows and Standard & Poor's did not downgrade Greece's credit rating.

The Dow Jones industrial average rose 44 points, or 0.4%. The S&P 500 index added 9 points, or 0.8%, to close at a fresh 18-month high. The Nasdaq composite gained 16 points, or 0.7%.

Stocks have been grinding higher in recent weeks as traders remain bullish about the economic recovery.

Fed: Low rates will continue - CNNMoney.com -- The Federal Reserve left its key interest rate near 0% once again Tuesday and said rates should stay this low for the foreseeable future.

Fed policymakers repeated their prediction that economic conditions are likely to result in "exceptionally low levels of the federal funds rate for an extended period." That promise of an easy-money policy has been in place since March 2009.

The so-called fed funds rate, a benchmark that determines the interest paid by consumers and businesses on a wide variety of loans, has been near 0% since December 2008, as the central bank worked to spur greater lending and economic activity.

Besides low interest rates, the Fed has pumped trillions of dollars into the U.S. economy over the last two years through the purchases of mortgage-backed securities, long-term Treasurys and special lending programs.

Most of those programs are at or near an end. The Fed said it is close to completing its planned purchases of $1.25 trillion in mortgage-backed securities which it started in November 2008. It has long targeted the end of the first quarter for the completion of this program.

Some economists are worried that mortgage rates will start to rise once the Fed is no longer buying mortgages.

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