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| Bonds Online |
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| 5/10/2013Market Performance |
| Municipal Bonds |
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S&P National Bond Index
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3.00% |
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S&P California Bond Index
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2.96% |
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S&P New York Bond Index
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3.13% |
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S&P National 0-5 Year Municipal Bond Index
|
0.70% |
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| S&P/BGCantor US Treasury Bond |
400.09 |
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| More |
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| Income Equities: |
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| Preferred Stocks |
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S&P U.S. Preferred Stock Index
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848.03 |
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S&P U.S. Preferred Stock Index (CAD)
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636.26 |
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S&P U.S. Preferred Stock Index (TR)
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1,701.05 |
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S&P U.S. Preferred Stock Index (TR) (CAD)
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1,276.26 |
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| REITs |
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S&P REIT Index
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174.07 |
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S&P REIT Index (TR)
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425.30 |
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| MLPs |
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S&P MLP Index
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2,469.58 |
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S&P MLP Index (TR)
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5,428.50 |
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See Data
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REIT Rally Likely Isn’t Over Yet |
Dow Jones, August 17, 2009
Although real estate investment trusts are in for a drubbing by the continued deterioration in commercial real estate, their shares likely won’t suffer much, especially if REITS manage to roll over their debt.
REITs - which own a wide array of commercial real estate, from office buildings to strip malls - have already rallied some 90% from the 18-year low they hit in March as the drop-off in home prices and economic conditions has slowed. But with REITs still around 60% below their February 2007 highs, an expected hit from commercial real estate is believed to be priced in.
Because the sector’s heavy debt load was such a big contributor to its precipitous drop last fall, REIT stocks are expected to go nowhere but up if debt refinancings occur. With bank conditions improving, that’s looking increasingly likely.
“Given the appearance that the banking system has stabilized, that leads you to the belief that most of these REITs will be able to get their refinancing in order. With that thought, it’s not surprising money would move into the REITs,” said Chris Colarik, portfolio manager at Glenmede in Philadelphia.
From a technical aspect, REITs look set to ultimately rise as much as 35% from current levels. However, they would first likely retreat a bit before building a broader level of support on the way back up, Marc Pado, U.S. market strategist at Cantor Fitzgerald, said.
Looking at the Vanguard REIT ETF (VNQ), which closed at 38.28 Friday, Pado identified 31 as a level of “exceptional support,” and 40 as a level of resistance, meaning it will be difficult for the ETF to cross 40, while any pullback is unlikely to bring the ETF below 31. Pado expects the ETF will decline toward 31 before building a broader base of support on its way back up, enabling it to cross 40 and move higher yet. “At that point I would use 50 as an objective, being that that’s still well below the 2007 lows,” Pado said.
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| Stuff to look at |
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| BondsOnline Advisor |
Income Security Recommendation January 2013 Issue.
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