Stock exchange traded funds (ETFs) eked out modest gains on Thursday, shrugging off earlier losses due to an unexpected rise in unemployment claims and higher commodity prices.
- The dollar fell further against the euro and declined against the Japanese yen Thursday, pushing an index measuring the greenback against a basket of six currencies to its lowest level since December 2009. The greenback lost a little ground after a pair of U.S. economic reports showed that jobless claims unexpectedly increased and wholesale prices rose – the dollar index dipped as low as 74.617, its lowest level since December 2009. “There is still very little case for a general U.S. dollar recovery,” Adrian Schmidt, currency strategist at Lloyds TSB, wrote in as note to clients. “The underlying picture of more sluggish U.S. growth than hoped for has been established by recent data” and “prevents any development of independent dollar optimism.” The PowerShares DB U.S. Dollar Index Bullish ETF (NYSEArca: UUP) closed moderately lower on Thursday.
- Shares of Goldman Sachs, Deutsche Bank and other financial-services stocks fell Thursday after more reports surfaced about the industry’s alleged shenanigans during the global financial crisis. U.S. investigators have been looking into whether some big banks manipulated a key interest rate, known as Libor, during the financial crisis, The Wall Street Journal reported. Bank stocks were also pressured by concern about the impact of a regulatory settlement that may dent the profitability of the mortgage-servicing business. “Investors may be unsettled by the difficulty associated with estimating the impact to mortgage servicing revenues from higher servicing expenses and monetary remediation, and this could be an overhang on the shares of companies involved until all is settled,” banking analysts at Keefe, Bruyette & Woods, led by Fred Cannon, wrote in a research note late Wednesday. The Financial Select Sector SPDR (NYSEArca: XLF), an exchange-traded fund that tracks financial stocks in the S&P 500 Index, fell almost 1% today.
- A weaker dollar helped lift silver ETFs on Thursday. The iShares Silver Trust (NYSEArca: SLV) rose nearly 4% to a new high.
Gregory A. Clay contributed to this article.
For full disclosure, Tom Lydon’s clients own SLV.
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