08 Aug Float for now
Markets opened with stocks trying to make a turnaround to the positive side, but they have since dropped back into the red. The pressure looks to be led by banks, as the Justice Department is evaluating possible charges against JP Morgan. The accusations involve breaking securities laws between 2005 and 2007, involving mortgage backed securities. Initial Jobless Claims came in slightly lower than estimates, but still 5,000 above the previous week. mortgage bonds are pushing higher again, and that is despite the mediocre auction results yesterday. The Treasury will sell $16 billion in 30 year bonds today, which could put a cap on bonds moving even higher. Europe has not been in the headlines lately, but Greece just reported a new historical high of their unemployment rate at 27.6%. We will maintain a floating bias as the signs of momentum appear to be with bonds and away from stocks for now.