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Week Ended February 5, 2010

After a promising start, markets ended lower for the fourth consecutive week. Small-caps fared particularly poorly. On Monday, investors bid shares higher in response to a favorable reading on a gauge of manufacturing activity, which showed factories at their busiest in five years. News on Tuesday that a major homebuilder had managed to record its first profitable quarter in two years also boosted sentiment. The major indexes experienced a reversal at midweek, however, when a disappointing earnings report from drug giant Pfizer weighed on the broader market. The selloff accelerated on Thursday, leading the Dow to record its worst drop since April. Investors appeared to react to disturbing news from European credit markets and worries over the eroding fiscal position of Greece, in particular. An unexpected rise in weekly jobless claims in the United States also concerned investors. Somewhat better news on the labor market appeared on Friday. Although payrolls did not increase in January, as many had hoped, the Labor Department reported that the unemployment rate had fallen from 10.0% to 9.7%, its lowest level since last summer.

U.S. Stocks¹
Index²	Friday’s Close	Week’s Change	% Change Year-to-Date
DJIA	10012.23	-55.10	-3.99%
S&P 500	1066.18	-7.69	-4.39%
NASDAQ Composite	2141.12	-6.23	-5.64%
S&P MidCap 400	697.09	-5.71	-4.07%
Russell 2000	592.50	-11.01	-6.56%

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 February 5, 2010

Longer-term Treasury yields rose on Wednesday, when payroll processing firm ADP reported the smallest monthly drop in private sector jobs in nearly two years. Yields moved back lower on Thursday, however, when the government surprised many by reporting a rise in weekly jobless claims. The mixed news on the job market was confirmed on Friday, when the Labor Department released its closely watched report on monthly payrolls. While the report showed a small drop in January payrolls, it also revealed that the unemployment rate had declined from 10.0% to 9.7%. Bond markets also responded during the week to concerns over the worsening fiscal problems of some of the smaller European economies, particularly Greece and Portugal. While defaults on sovereign debt still appeared unlikely, many worried that the problems would weaken the euro zone as a whole should larger nations, such as Germany, need to provide assistance. The euro slumped, reaching an eight-month low relative to the U.S. dollar.

U.S. Treasury Yields¹
Maturity	February 5, 2010	January 29, 2010
2-Year	0.75%	0.83%
10-Year	3.56%	3.60%
30-Year	4.51%	4.50%

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, February 5, 2010.

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Week Ended January 29, 2010

International Stocks

Foreign stock markets closed higher for the week ending January 29, 2010 with the broad international measure, the MSCI EAFE Index (Europe, Australasia, and Far East), losing -3.51%.


Region/Country	Week’s Return	% Change Year-to-Date
EAFE	-3.51%	-4.40%
Europe ex-U.K.	-2.82%	-6.42%
Denmark	1.43%	3.13%
France	-3.48%	-7.39%
Germany	-3.17%	-8.63%
Italy	-4.44%	-8.46%
Netherlands	-0.99%	-3.54%
Spain	-5.62%	-11.72%
Sweden	-1.41%	-2.49%
Switzerland	-2.21%	-3.34%
United Kingdom	-2.76%	-4.81%
Japan	-4.96%	1.90%
AC Far East ex-Japan	-3.67%	-6.11%
Hong Kong	-2.40%	-6.59%
Korea	-5.28%	-4.35%
Malaysia	-3.44%	-0.88%
Singapore	-2.94%	-6.00%
Taiwan	-2.89%	-6.48%
Thailand	-2.97%	-5.31%
EM Latin America	-3.51%	-8.87%
Brazil	-4.27%	-10.93%
Mexico	-1.38%	-6.23%
Argentina	-2.22%	-3.19%
EM (Emerging Markets)	-3.10%	-5.56%
Hungary	-0.87%	0.71%
India	-3.57%	-5.30%
Israel	-2.52%	0.31%
Russia	-0.70%	2.39%
Turkey	0.85%	2.26%

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International Bond Markets

International bond markets in developed countries were lower this week, with the J.P. Morgan Global Government Bond Less U.S. Index losing -0.97%.


Region/Country	Week’s Return	% Change Year-to-Date
Developed Markets	-0.97%	0.08%
Europe
Denmark	-1.48%	-1.75%
France	-1.38%	-1.92%
Germany	-1.33%	-1.64%
Italy	-1.86%	-3.06%
Spain	-1.61%	-3.42%
Sweden	-1.45%	-1.86%
United Kingdom	-0.49%	-0.31%
Japan	-0.52%	2.65%
Emerging Markets	-0.37%	-0.14%
Argentina	0.72%	-5.96%
Brazil	-0.86%	-0.95%
Bulgaria	0.12%	0.30%
Russia	-0.09%	0.83%

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International Currency Markets

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


Currency	Close (January 29, 2010)	Week’s Return (U.S. $)	% Change Year-to-Date (U.S. $)
Japanese yen	90.655	0.63%	-2.69%
Euro	1.39¹	1.62%	3.12%
British pound	1.6024¹	0.62%	0.77%

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.