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Interesting read..............I'll just post the link



SCENARIOS: How Obama's bank reforms could affect banks

NEW YORK (Reuters) - President Barack Obama is looking at limiting risk-taking at banks.


But his proposals on Thursday were tantalizingly vague. He said he wanted to limit the amount of borrowing that banks can do relative to their peers and limit their trading activities to buying and selling securities to customers.


But it is not clear whether relative borrowing limits will be low enough to force banks to reduce their debt. And the line between buying and selling securities on behalf of customers, and doing so on behalf of the bank, can be blurry.






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  • 1 month later...

Interesting read - you make up your mind.....................Click on the link below for the full article


(Reuters) - With U.S. stocks pressing up against 17-month highs, the inevitable question arises: "Does this rally have legs?"


From one perspective, things couldn't look rosier for the bulls. The S&P 500 touched another 17-month high on Wednesday, breaking through levels analysts identified as significant resistance. More stocks in the S&P are hitting fresh 52-week highs than at any time during the course of the rally.


But the steady rise in the last six weeks has been accompanied by middling volume and underperformance in key areas, such as semiconductor companies. Market technicians and strategists believe the current run is overbought, suggesting at least a near-term pullback.


"What we are seeing represents a very defensive stance among investors," said Mike O'Rourke, chief market strategist at BTIG, an institutional brokerage firm in New York. "You are seeing investor disinterest in equities and that's why volume is languishing here."


This week's consolidated volume has been telling. With major averages hitting recovery highs, Monday marked the third slowest volume day of 2010 when about 7.24 billion shares traded on the combined New York, American and Nasdaq stock markets, below last year's estimated daily average of 9.65 billion.


The tepid volume suggests a lack of broader conviction, and is a sign momentum is mostly behind the latest run-up rather than any broad-based accumulation of stocks.



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  • 2 years later...

U.S. stocks declined, extending losses since the re-election of President Barack Obama and sending the Dow Jones Industrial Average to the lowest level since July, amid concern about Greece's financial aid payment.

Apple Inc. (AAPL), the world's most valuable company, retreated 3.6 percent, extending its plunge since its September high to 23 percent. McDonald's Corp. (MCD), the world's largest restaurant chain, dropped 2 percent after its monthly store sales declined for the first time in nine years. Prudential Financial Inc. (PRU), the second- largest U.S. life insurer, decreased 4.8 percent after lowering its assumptions for equity and bond returns.

The Standard & Poor's 500 Index declined 1.2 percent to 1,377.51 at 4 p.m. New York time, dropping 3.6 percent in two days, the biggest slump in a year. The benchmark gauge for U.S. equities fell below its average price of the last 200 days of 1,380.71. The Dow sank 121.41 points, or 0.9 percent, to 12,811.32. Volume for exchange-listed stocks in the U.S. was 6.9 billion shares, or 15 percent above the three-month average.

"It's hard bargaining for Greece," said Alan Gayle, a senior strategist at RidgeWorth Capital Management in Richmond, Virginia, which oversees about $47 billion. "The risk of a recession is still out there. Apple might be a victim of its own success because it's risen so much. With its huge market cap, as Apple goes, so goes the broader market."

Equities extended yesterday's tumble as investors' focus turned to the budget debate and Europe's debt crisis following President Obama's re-election. Energy, financial and technology shares had the biggest declines in the S&P 500 in two days, falling at least 4.2 percent.

Under Pressure

Euro-area finance ministers may not make a decision on unlocking funds for Greece until late November as they await a full report on the country's compliance with the terms of its bailout, a European Union official said.

Greek Prime MinisterAntonis Samaras mustered support in Parliament to approve austerity measures needed to unlock bailout funds, in a tense vote that weakened his majority after the expulsion of seven dissenting lawmakers. The European Central Bank kept interest rates on hold today as the economic outlook worsens and Spain resists asking for a bailout that would open the door to ECB bond purchases.

"We're not out of the woods yet," German Finance Minister Wolfgang Schaeuble said in Hamburg today. "At the moment, I don't see how we can take the decision already next week."


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  • 7 years later...

The splitting of Apple shares via a reverse four for one division has triggered a historic change in the Dow Jones average ... oil giant Exxon Mobil is out, as is drug group, Pfizer and defence manufacturer Raytheon Technologies. Cloud based customer relations management software group Salesforce replaces Exxon Mobil in something of a surprise, biotech drugmaker, Amgen replaces Pfizer and industrial group, Honeywell will replace Raytheon.


Apple split will have a dramatic impact on the ranking of the companies in the 30 stock Dow. Apple will fall from Number one to Number 17 because the Dow is a price weighted index). The top three stocks will become UnitedHealth Group Inc., Home Depot, and Amgen in that order.


The ousting of Exxon is a historic move as it has been a Dow member for 92 years. It joined in October 1928 (a year before the Great Crash), when it was called Standard Oil of New Jersey. For decades the company was one of the 10 most valuable publicly traded companies, and for six straight years—from 2006 through 2011—it was the most valuable company in terms of market value.


S&P Dow Jones said the changes were prompted by the Apple four for one split which happens after the close this Friday (Ie from trading next Monday) will reduce the index's tech-sector weighting in the Dow, hence the rebalancing.


The announced changes help offset that reduction. They also help diversify the index by removing overlap between companies of similar scope and adding new types of businesses that better reflect the American economy, said S&P


Apple joined the Dow back in 2015 not long after a seven for one stock split.


The changes won't disrupt the level of the index, S&P Dow Jones said in a statement. The divisor used to calculate the index from the components' prices on their respective home exchanges will be changed prior to the opening on Aug. 31, 2020.


While that is true, American market analysts point out that there is another, very good reason, for Exxon Mobil to be punted ... underperformance. Its shares traded for more than $US104 in June 2014, against $US41 today. Even taking dividends into account, it has underperformed the Dow since 2014 by 21%.


The last venerable US company to be punted from the Dow was General Electric back in 2018. It has underperformed the Dow since then at an annual rate of 21% while the Dow has risen at an annual rate of 9%.

Apple shares closed Tuesday at $US499.30 valuing it at $US2.15 trillion. It hit an alltime high of $US515.14 last Friday in trading. If the $US500 level holds, the theoretical value of the new shares post-split will be around $US125.


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