Last night I thought I would need to title this blurp as “Monday Morning Beatdown”, but we have seen a 500 point swing in the DJIA overnight so “all is good”.
Last week common stocks traded in a wide range with the SP500 trading at a low of 2834 to a high of 2939 before closing the week near the low at 2847. The 10 year treasury moved in a range of 1.50% to 1.62% and closed the week at 1.53%. The 10 year treasury closed at 1.54% the week before so all in all there was virtually no change over the week.
The average $25 preferred stock/baby bond moved 1 penny lower last week–us income investors have to be damned happy about that lack of movement. There are now 147 issues trading at $25 or below (out of 664 issues) which is 5 issues fewer than the week before.
The Fed balance sheet, which is now supposed to be in a neutral position, dropped by $12 billion last week. This seems like a pretty big runoff for being in a neutral stance (on the balance sheet). It will be interesting to see the weeks ahead. Given the low interest rates now would be a good time to let the runoff continue, but they have stated the runoff is over–guess we will have to watch and see.
Last week we saw just 1 new income issues announced.
JMP Group (NASDAQ:JMP) announced that they would be issuing a new $25 baby bond. No pricing has yet been announced for the issue. I suspect the unsettled markets have lent a bit of uncertainty to pricing–I would think we would see something in the next day or 2.