Cash is getting an alarming amount of love these days.
When investors are nervous, they flee risky assets like stocks for the safety of cash.
That’s exactly what’s been happening lately. Since July 1, cash and money market funds have easily been the world’s most popular asset class, attracting $208 billion of inflows, according to Bank of America Merrill Lynch.
Technology giant Apple is expected to raise at least $5bn by issuing bonds on Monday.
Some of the funds raised will be used for Apple’s share buyback programme. The California-based company plans to return more than $130bn to shareholders by the end of this year.
The move comes despite the company sitting on a cash pile of $178bn.
Apple will raise less than half the $12bn generated in April 2014 when it was last active in the US bond market.
A year earlier it raised $17bn.
Millions of Americans make resolutions to hit the gym, eat more salad and smile frequently. But don’t forget to pay as much attention to your money.
Keeping tabs on your investment portfolio can be just as important when it comes time for retirement.
Here’s CNNMoney’s suggested list of New Year’s resolutions for investors:
1. Find your password and log on! Many investors who have their portfolios in cruise-control mode. While you don’t need to trade daily, it’s important to at least do an annual checkup on your accounts. Log in or call your 401(k) or brokerage account provider and see whether you should make any changes.
At your annual physical, you get your blood pressure checked. The equivalent to that in investing is looking at your asset allocation — how much you have in stocks versus bonds versus cash and commodities.
Is your asset mix still appropriate based on your age and risk tolerance? It could be time to make a change.
Investors are running away from stocks as fast as they can.The Dow plunged more than 350 points shortly after the opening bell Wednesday while the S&P 500 and Nasdaq each dropped more than 2%. Stocks rebounded later in the morning but the sell-off worsened as the day wore on. The Dow was down more than 400 points by mid-afternoon. Strangely enough though, it seems that investors are still bullish on America in spite of the market volatility. They are doubling down their bets on U.S. Treasury bonds.
The rate on a 10 Year Treasury plunged Wednesday morning to 1.86% — its lowest level since May 2013. Yields fall when investors are buying bonds. The yield moved back above 2% later on during the day. So rates still have a relatively long way to go before they approach their all-time low of 1.39% from July 2012.
Brian’s Briefs, written and compiled Monday through Friday by Brian Weide, SunStar Mortgage Services
Friday, June 29, 2012
As I mentioned yesterday, bonds and Mortgage-backed Securities have been flip-flopping around like water on a hot skillet the last 10 days or so, and today was no exception. While closing off their lows, both securities closed lower today after having rallied yesterday. Data was mildly bond-friendly overall. Personal Income rose by .2%, which was twice the rate expected (see Moving the Market). Personal Spending was unchanged for May against expectations of +.1%. Core PCE Prices, which is a favorite gauge of the Fed in measuring inflation, as it works with consumer’s actual spending habits instead of a fixed “basket of goods” as does the CPI, was up by .1% vs. consensus estimates of .2%.
The Chicago Purchasing Managers’ Index landed at 52.9 for June- real close to estimates of 53.0 but not quite there. Finally, the final read for June for the University of Michigan Consumer Sentiment survey reported at 73.2; again, below estimates of 74.1. So with the exception of Personal Income, all the stats were below estimates, but yet very close; hence my insinuation that bonds were mildly supported by these numbers. However, data was not the main driver for bonds today. First off, stocks were strongly into rally mode (Dow +277.83 at 12880.09, Nasdaq +85.56 at 2935.05, S&P +33.12 at 1362.16), being buoyed by news that Eurozone officials have opened the door for Spain’s banks to be directly recapitalized with bailout funds once Europe sets up a single banking supervisor. Moreover, Spain will not have to take on additional sovereign debt.
Dispatches From The Front 