Finance Wall Street

Wall Street Journal Report

March 22nd, 2012

MONDAY

On Tuesday the market did extraordinarily well as news from the FOMC meeting, U.S. consumers and the banking system all had positive results. The Dow ended the day up 1.28% its highest level since December 2007, the S&P 500 ended up 1.81%, a level it hasn’t seen since June 2008. The NASDAQ also did well as it ended Tuesday up 1.88% and reached levels above 3,000 since the year 2000. The T10Y increased by 7 basis points as the Fed acknowledged improvement in the economy. The $/Euro ended the day depreciating by .0072 as it seems that the European debt crisis will not be resolved any time soon and on the opposite end the Yen/$ rate also depreciated by .72. Some major things that happened on Tuesday was that February’s retail sales data was released and retail sales rose by 1.1% the biggest gain in 5 months. The FOMC had a quite meeting where we were expecting some news about QE3, but it was not mentioned. They did acknowledge that there has been improvement in the economy and that they will continue with Operation Twist and will keep the interest rate at .25%. The Federal Reserve finished their round of stress tests on the top 19 banks and while most did fairly well, four failed the test, including Citi, Ally, Bank of America and Metlife. The test is designed to see if the banks have enough capital buffers to withstand another recession or financial crisis. The four that did not pass the test did not meet the 5% minimum capital ratio set out by the Fed. After the test many banks released news that they will increase their dividends, including JPMorgan who will raise their dividend from .25 to .30.

Wednesday

On Thursday for the first time, the S&P 500 finished over 1,400, the DJIA closed above 13,000, and the NASDAQ ended above 3,000. The S&P 500 is above 1,400 for the first time in four years, the DJIA made a gain for the seventh trading day in a row, and the NASDAQ had its highest close in more...