Week Ended January 7, 2011

Stocks rose to start the new year, with particularly strong gains for the technology-oriented Nasdaq index. Stock prices shot upward in early trading on Monday, mirroring good gains in Europe resulting from a favorable read on the Continent's manufacturing activity. After the open, the Institute for Supply Management provided good news for the U.S. as well by announcing that new orders for manufactured goods had increased sharply in December. Investors also bid the shares of financial giant Bank of America sharply higher following the announcement that it had set aside funds for buying back bad loans issued by subsidiary Countrywide Financial. Markets advanced further on Wednesday following an estimate from payroll processing firm ADP that employers had added nearly 300,000 jobs in December. The ADP report led many to expect good news from the more comprehensive payrolls report released by the Labor Department on Friday. The official tally disappointed, however, as the government's data showed private employers adding only 103,000 jobs. Stocks turned lower in response, although losses may have been mitigated by details in the report showing upward revisions to October and November payrolls. Some traders may also have been encouraged that the unemployment rate also fell from 9.8% to 9.4%—its biggest monthly drop in years—although others noted that the decline was due in part to discouraged workers dropping out of the labor force.

U.S. Stocks¹
Index²	Friday's Close	Week's Change	% Change Year-to-Date
DJIA	11674.76	97.25	0.84%
S&P 500	1271.50	13.86	1.10%
NASDAQ Composite	2703.17	50.30	1.90%
S&P MidCap 400	910.53	3.28	0.36%
Russell 2000	787.03	1.76	0.22%

This chart is for illustrative purposes only and does not represent the performance of any specific security. Past performance cannot guarantee future results.

¹Source of data Reuters, obtained through Yahoo! Finance Closing data as of 4:10 p.m. ET.

²The Dow Jones Industrial Average and the Standard & Poor's 500 Stock Index of blue chip stocks, the Standard & Poor's MidCap 400 Index, and the Russell 2000 Index are unmanaged indexes representing various segments by market capitalization of the U.S. equity markets. The Nasdaq Composite is an unmanaged index representing the companies traded on the Nasdaq stock market and the National Market System.

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U.S. Bond Market

Week Ended January 7, 2011

The labor market topped the economic news during the week, with unemployment falling from 9.8% in November to 9.4% in December, its lowest level in 19 months. Weekly wages rose at a 4.4% annual rate over the final three months of 2010 and by 4.6% over the entire year, another hopeful sign that the worst may be over on the labor front. Private employers added 103,000 new jobs during the final month of the year, a bit fewer than expected; economists believe the private sector needs to add a minimum of 200,000 jobs a month for a steady drop in unemployment to ensue. Still, the news provided a glimmer of hope that the year ahead could see slow but significant improvements in the overall economy. Longer-term Treasury yields rose during the week as investors redeployed their capital into riskier assets (bond prices and yields move counter to each other).

U.S. Treasury Yields¹
Maturity	January 7, 2011	December 31, 2010
2-Year	0.59%	0.59%
10-Year	3.32%	3.28%
30-Year	4.47%	4.34%

This table is for illustrative purposes only. Past performance cannot guarantee future results.

¹Source of data: Bloomberg.com, as of 4 p.m. ET Friday, January 7, 2011.

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International Market

Week Ended December 31, 2010

International Stocks

Foreign stock markets closed higher for the week ending December 31, 2010 with the broad international measure, the MSCI EAFE Index (Europe, Australasia, and Far East), gaining 0.7%.


Region/Country	Week's Return	% Change Year-to-Date
EAFE	0.70%	8.21%
Europe ex-U.K.	0.46%	2.44%
Denmark	1.54%	31.09%
France	-0.16%	-3.23%
Germany	0.18%	9.32%
Italy	-0.56%	-14.07%
Netherlands	1.92%	2.17%
Spain	-0.33%	-21.13%
Sweden	1.65%	34.81%
Switzerland	0.74%	12.86%
United Kingdom	-0.50%	8.80%
Japan	1.90%	15.59%
AC Far East ex-Japan	2.02%	19.79%
Hong Kong	0.56%	23.23%
Korea	2.49%	27.15%
Malaysia	0.83%	37.01%
Singapore	3.32%	22.16%
Taiwan	3.34%	22.73%
Thailand	1.41%	56.27%
EM Latin America	2.56%	14.89%
Brazil	3.30%	6.81%
Mexico	1.47%	27.61%
Argentina	1.59%	77.37%
EM (Emerging Markets)	2.19%	19.20%
Hungary	1.59%	-9.58%
India	3.16%	20.95%
Israel	3.32%	5.00%
Russia	-0.08%	19.40%
Turkey	-0.45%	21.24%

International Bond Markets

International bond markets in developed countries were higher this week, with the J.P. Morgan Global Government Bond Less U.S. Index gaining 2.44%.


Region/Country	Week's Return	% Change Year-to-Date
Developed Markets	2.44%	6.78%
Europe
Denmark	2.56%	1.21%
France	2.40%	-1.42%
Germany	2.52%	-0.55%
Italy	1.66%	-7.03%
Spain	2.81%	-10.39%
Sweden	1.70%	9.34%
United Kingdom	2.19%	4.21%
Japan	2.67%	17.64%
Emerging Markets	0.13%	11.83%
Argentina	0.00%	35.82%
Brazil	0.02%	9.69%
Bulgaria	0.11%	8.16%
Russia	0.37%	8.64%

International Currency Markets

On the currency front, the U.S. dollar was weaker against the major currencies for the week.


Currency	Close (December 31, 2010)	Week's Return (U.S. $)	% Change Year-to-Date (U.S. $)
Japanese yen	81.105	-2.26%	-14.78%
Euro	1.3416¹	-2.26%	6.50%
British pound	1.5657¹	-1.35%	3.05%

¹U.S. dollars per national currency unit.

Sources: Foreign stock markets and currency sections are from Rimes Technologies, using MSCI data. International bond markets are from J.P. Morgan.

Note: All returns are in U.S. dollars. All bond indices are J.P. Morgan. All stock indices are Morgan Stanley Capital International (MSCI).

Equity Indices
EAFE:	MSCI Europe, Australasia, and Far East Index
Europe Ex-U.K.:	MSCI Europe ex-U.K. Index
Far East Ex-Japan:	MSCI AC Far East ex-Japan Index
Latin America:	MSCI Emerging Markets Latin America Index
Emerging Markets:	MSCI Emerging Markets Index

Bond Indices
Developed Markets:	J.P. Morgan Global Government Bond Less U.S. Index
Emerging Markets:	J.P. Morgan Emerging Markets Bond Index Plus

All charts are for illustrative purposes only and do not represent the performance of any specific security. Past performance cannot guarantee future results.