WEAK HEALTH CARE STOCKS DRAG MARKET LOWER – RSI LIKES MUNI AND O & G FUNDS February 26, 2009
Posted by Marlowe Cassetti in BFK, BLE, HTR, JPZ, PXJ, VKQ, XES.trackback
Today in the market, Thursday, February 26, 2009: This time, health care stocks bore the brunt of investors’ wrath. Health insurers and drug companies, some of the better performers on Wall Street lately, led the market lower Thursday after the White House proposed cutting payments to private insurance plans.
The day’s gyrations showed how fractious the market is, with investors ready to turn on stocks at the first whiff of bad news. Wall Street also extended a back-and-forth pattern that began earlier in the week. Market watchers say the sudden shifts reflect indecision among investors rather than big changes in their sentiment over the economy.
The Dow Jones industrial average fell 88.81, or 1.2 percent, to 7,182.08, pulled down by stocks including drug maker Merck & Co., down $1.87, or 6.7 percent, at $26.04 and health products company Johnson & Johnson, off $1.52, or 2.8 percent, at $52.44. The Standard & Poor’s 500 index fell 12.07, or 1.6 percent, to 752.83 and the Nasdaq composite index fell 33.96, or 2.4 percent, to 1,391.47. (headline & commentary courtesy of AP via Yahoo Finance)
ETF/CEF High Volatility:
- BFK – BlackRock Municipal Income Trust
- BLE – BlackRock Muni Income Fund
- HTR – Helios Total Return Fund, Inc.
- JPZ – Nuveen Equity Premium Income Fund
- PXJ – PowerShares Dynamic Oil & Gas Services Portfolio
- VKQ – Van Kampen Municipal Trust
- XES – SPDR S&P Oil & Gas Equipment & Services Index
ETF/CEF Discussion: The market gyrations continue to cause RSI to only select high volatility funds. In today’s last there is a decided favoring of oil & gas and municipal income funds. Please note that the Helios and Van Kampen closed end funds (CEF) have an expense ratio of 2%. A bit rich for my liking, but someone may like them for their tax free yield. Also they will be beneficiaries of he recently passed stimulus plan via the payments to states. The O & G funds have been badly beaten down. Check their charts. Use caution since they may not be at the bottom.
Catch you tomorrow.
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