new yorkDennis Seid 6/21/10
Stocks fall after China
yuan enthusiasm fades
n NEW YORK – Stocks erased big gains Monday after investors lost some of their enthusiasm about China’s decision to let its currency, the yuan, appreciate against the dollar.
The initial reaction to China’s weekend announcement was that a stronger yuan compared with the dollar would allow U.S. manufacturers and exporters to be more competitive selling their products in China. But traders came to see the move as more of a long-term shift rather than something that would give the economy a boost now.
The news from China hurt retailers because inexpensive imports from China would become more expensive. That could cut into earnings.
The Dow fell 8.23, or 0.1 percent, to 10,442.41. The Samp&P 500 index fell 4.31, or 0.4 percent, to 1,113.20, and the Nasdaq fell 20.71, or 0.9 percent, to 2,289.09.
Crude oil rose 64 cents to $77.82 per barrel on the New York Mercantile Exchange. Gold hit a record $1,266.50 an ounce before settling down $17.60 at $1,240.70 an ounce.
Borrowers exit troubled
Obama mortgage program
n WASHINGTON – More than a third of the 1.24 million borrowers who have enrolled in the $75 billion mortgage modification program have dropped out. That exceeds the number of people who have managed to have their loan payments reduced to help them keep their homes.
Last month alone,155,000 borrowers left the program – bringing the total to 436,000 who have dropped out since it began in March 2009.
About 340,000 homeowners have received permanent loan modifications and are making payments on time.
A major reason so many have fallen out of the program is the Obama administration initially pressured banks to sign up borrowers without insisting first on proof of their income. When banks later moved to collect the information, many troubled homeowners were disqualified or dropped out.