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Stocks Slightly Down, Treasuries Up
February 6th, 2012 by Marc Prosser
Long-Term Treasuries benefited from a supply squeeze. One buyer, the Fed, is buying huge amounts of longer-term treasuries in its efforts to keep interest rates low for shorter-term borrowing. However, the story of the day continues to be Europe and in particular, Greece. There is a concern that Greece will not accept the terms of the debt relief package. If they don’t the consequences are unknown but, very scary to the market.All three major stock indexes finished the day marginally lower, turning in losses of 0.15% or less. The bond market as represented by the two most widely held bond ETFs, closed slightly higher, less than 0.1% up.The S&P 500 (ETF: SPY) was 19 points higher today at 1,344.33, down 0.57%. The bond market was almost flat as iShares Barclays Aggregate Bond ETF (AGG) finished 8 cents up at $110.64, 0.07% higher than the previous day. (note as bond prices fall, yields increase).
The Dow Jones industrial Average (ETF: DIA) came off a 4 year high falling 19 points closing at 12,843, down 0.14%. In terms of individual Stocks, Alpha Natural Resources (ANR) got a lift as it announced that it would scale back its coal production efforts. Micron Technologies (MU) fell reflecting Friday’s misfortune involving the CEO have a fatal plane accident. Shares of the toymaker Hasbro (HAS) rose as earnings came in a penny over expectations.
In terms of the treasury bond market, the iShares Barclays 20 Year Treasury Bond Fund (TLT) rose exactly 1.0% to $117.17. Junk bonds rose slightly as represent by the iShares iBoxx $ High Yield Corporate Bond Fund (HYG) ending higher 2 cents at $90.74. The lack of movement in Junk bonds reflects conflicting trends: an improving US economy and danger that the crisis in Europe may set-back all US progress.