Week
Ended November 4, 2011
The
market's weekly winning streak came to an end as the European debt deal that
emerged the previous week was thrown into doubt. Stocks fell sharply to begin
the week as growing concerns about the deal were accentuated by Greece's
surprise announcement that it would hold a national referendum on its
participation the latest bailout, which raised fears it would exit the
eurozone. Stocks regained some footing at midweek, thanks apparently to a
pledge from Federal Reserve Chairman Ben Bernanke that the central bank stood
"prepared to take further action as appropriate to promote a stronger
economic recovery." A positive reading on October job gains from payroll
processing firm ADP also helped boost sentiment. On Thursday—following
threats from Germany and France to cease further aid to Greece—the
Greek government announced that it was abandoning plans for a referendum.
Investors were also encouraged by an unexpected cut in interest rates by the
European Central Bank, and stocks moved to their highest level for the week in
response. Greece's back-and-forth on the referendum appeared to further weaken
the position of its ruling party however, worries over an upcoming confidence
vote in the Greek parliament caused markets to end the week on a down note. The
closely watched monthly payrolls report from the Labor Department may have
helped mitigate losses. Although job growth remained anemic in October, the
unemployment rate fell slightly, to 9.0%, and previous months' payroll gains
were revised upward.
|
U.S. Stocks1 |
|||
|
Index2 |
Friday's Close |
Week's Change |
% Change |
|
DJIA |
11983.24 |
-247.87 |
3.50% |
|
S&P 500 |
1253.23 |
-31.85 |
-0.35% |
|
NASDAQ Composite |
2686.15 |
-51.00 |
1.25% |
|
S&P MidCap 400 |
897.63 |
-13.80 |
-1.06% |
|
Russell 2000 |
746.05 |
-16.57 |
-4.99% |
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.
____________
Week
Ended November 4, 2011
News
that Greek Prime Minister George Papandreou would submit a European bailout
package to a referendum roiled financial markets during the week. However,
protests from Germany and France, as well as dissention within the Greek
parliament and among members of the prime minister's own cabinet, forced him to
rescind his call for a referendum a couple of days later. On the domestic
front, Federal Reserve Chairman Ben Bernanke said that current economic conditions
warranted keeping the central bank's stimulative monetary policy in place until
at least mid-2013. Unemployment remains high at 9%, and the housing market is
still in a slump. T. Rowe Price believes that the Fed would like to
see the unemployment rate fall to around 8.3% before it considers raising rates
again. Treasury bonds rallied on the news, sending interest rates lower for all
maturities (prices and yields move in opposite directions).
|
U.S. Treasury Yields1 |
||
|
Maturity |
November 4, 2011 |
October 28, 2011 |
|
2-Year |
0.22% |
0.29% |
|
10-Year |
2.04% |
2.32% |
|
30-Year |
3.09% |
3.36% |
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, November
4, 2011.
___________
International Stocks
Foreign stock markets closed higher for
the week ending October 28, 2011 with the broad international measure, the MSCI
EAFE Index (Europe, Australasia, and Far East), gaining 6.28%.
|
|
||
|
Region/Country |
Week's Return |
% Change Year-to-Date |
|
EAFE |
6.28% |
-2.91% |
|
Europe ex-U.K. |
6.82% |
-3.17% |
|
Denmark |
9.71% |
-12.07% |
|
France |
7.61% |
-3.30% |
|
Germany |
8.36% |
-3.14% |
|
Italy |
5.59% |
-7.68% |
|
Netherlands |
4.57% |
-2.86% |
|
Spain |
6.45% |
3.18% |
|
Sweden |
10.21% |
-4.71% |
|
Switzerland |
4.42% |
0.85% |
|
United Kingdom |
5.16% |
2.97% |
|
Japan |
4.53% |
-7.39% |
|
AC Far East ex-Japan |
9.77% |
-7.77% |
|
Hong Kong |
9.78% |
-9.91% |
|
Korea |
9.10% |
-3.04% |
|
Malaysia |
6.37% |
0.29% |
|
Singapore |
9.73% |
-5.80% |
|
Taiwan |
6.46% |
-14.02% |
|
Thailand |
10.09% |
-0.83% |
|
EM Latin America |
10.26% |
-11.45% |
|
Brazil |
11.27% |
-12.96% |
|
Mexico |
8.83% |
-6.70% |
|
Argentina |
-1.30% |
-31.72% |
|
EM (Emerging Markets) |
9.80% |
-9.98% |
|
Hungary |
1.62% |
-21.85% |
|
India |
9.03% |
-20.15% |
|
Israel |
6.41% |
-19.53% |
|
Russia |
11.57% |
-6.08% |
|
Turkey |
5.43% |
-22.63% |
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 1.08%.
|
|
||
|
Region/Country |
Week's Return |
% Change Year-to-Date |
|
Developed Markets |
1.08% |
8.92% |
|
Europe |
|
|
|
Denmark |
1.43% |
12.96% |
|
France |
2.56% |
8.73% |
|
Germany |
1.48% |
12.02% |
|
Italy |
1.60% |
0.81% |
|
Spain |
2.07% |
9.29% |
|
Sweden |
2.43% |
15.40% |
|
United Kingdom |
0.61% |
13.81% |
|
Japan |
0.40% |
8.80% |
|
Emerging Markets |
1.88% |
8.45% |
|
Argentina |
8.06% |
-7.75% |
|
Brazil |
1.20% |
10.90% |
|
Bulgaria |
0.99% |
2.39% |
|
Russia |
1.58% |
7.00% |
International Currency Markets
On the currency front, the U.S. dollar
was weaker against the major currencies for the week.
|
|
|||
|
Currency |
Close |
Week's Return |
% Change |
|
Japanese yen |
75.760 |
-0.49% |
-7.06% |
|
Euro |
1.41761 |
-2.00% |
-5.67% |
|
British pound |
1.61441 |
-1.23% |
-3.11% |
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