Reply #42: no winners today (except for everything else) [View All]

[UpInArms]

Dow 13,895.63 17.31 (0.12%)
Nasdaq 2,701.50 8.09 (0.30%)
S&P 500 1,526.75 4.63 (0.30%)
10-Yr Bond 4.579% 0.006

NYSE Volume 2,925,354,000
Nasdaq Volume 1,950,277,000

4:25 pm : Friday's reassuring economic reports were not enough to send the stock market out on a high note on the last trading day of the third quarter. The major indices stayed within a tight range, and spent the vast majority of the day in negative territory. Losses, though, were modest in scope.

The Dept. of Commerce released its Personal Income and Consumption report prior to the start of trading. Spending was up 0.6% for August, slightly stronger than the expected increase of 0.4%. This is significant, considering personal spending makes up 70% of economic activity. Personal income rose 0.3% (consensus +0.4%).

One of the favorite inflation indicators of the Fed, the core PCE deflator, met the consensus estimate for an increase of 0.1%. Presumably, the recognition that inflation has moderated will give the Fed more room for further rate cuts.

Interestingly enough, St. Louis Fed President Poole caused a bit of a stir near the end of the trading day after he reportedly said it would be a mistake for markets to bet on more rate cuts. That comment helped erase earlier gains in the Treasury market and sent the major indices to their lows for the session.

The major indices pared their losses in the last 45 minutes, though, as equity traders eventually viewed Poole's comment as an innocuous remark. After all, no Fed official is going to come out and say, "Yes, it would be a good idea to bet on more rate cuts."

The Chicago PMI, a regional manufacturer survey, was reported at 54.2 for September versus 53.8 in the prior month and the consensus estimate of 53.0. Due to the report's regional nature, the data did not cause the market to move much, but it was a welcome indicator due to all the recession chatter lately.

On a related note, it was reported that former Federal Reserve Chairman Alan Greenspan told BBC Radio that there is an increased risk of recession in the U.S. now, but that he still places the odds at less than 50/50.

Eight of the ten economic sectors lost ground Friday. Utilities (-1.4%), and telecom (-0.8%) were the biggest drag on the S&P today. Consumer discretionary (+0.08%) and consumer staples (+0.13%) were the only sectors that finished the day in the green, in response to the strong spending report.

The CRB commodities index was far more interesting than the stock market today, even though the index finished the day close to unchanged. Crude oil futures for November delivery were especially volatile today. Crude prices traded as high as $83.76 before running into resistance. They closed the session at $81.39 or nearly 3.0% off their high

Gold prices jumped 1.3% to $749.60 per ounce. Once again, gold perked up as the dollar index (-0.8%) slid to new lows.

For the quarter the Dow, Nasdaq, and S&P 500 gained 3.6%, 3.8%, 1.6%, respectively. The dollar index, meanwhile, dropped 5.1%.DJ30 -17.31 NASDAQ -8.09 SP500 -4.63 NASDAQ Dec/Adv/Vol 1777/1208/1.90 bln NYSE Dec/Adv/Vol 1834/1457/1.34 bln

3:30 pm : The stock market reached new intra-day lows in the last half hour following the comment from St. Louis Fed President Poole that it would be a mistake for the market to bet on more rate cuts.

Poole's remark should hardly be seen, though, as a real source of upset. Do you think a Fed official is really going to come out and say, "Yes, it would be a good idea for the market to bet on rate cuts?" All Poole's remark did was provide an added excuse to do some added profit taking ahead of the weekend.

Separately, General Motors (GM 37.07, +0.61) is the largest gainer in the Dow today. The company is getting a boost from details regarding its United Auto Workers (UAW) labor agreement that involves, among other things, a lower wage scale for new, non-core hires.DJ30 -35.12 NASDAQ -12.13 SP500 -6.19 NASDAQ Dec/Adv/Vol 1867/1069/1.46 bln NYSE Dec/Adv/Vol 1909/1343/839 mln

and the ever diminishing dollar:

Last trade 77.698 Change -0.619 (-0.79%)

Settle Time 15:00 Open 78.372

Previous Close 78.317 High 78.378

Low 77.666 2007-09-28 17:19:11, 30 min delay

52wk High 87.3 52wk High Date 2006-10-13

52wk Low 78.159 52wk Low Date 2007-09-27