STOCK MARKET WATCH, Monday, 24 January

[54anickel]

Wednesday January 24, 2005

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 3 YEARS, 361 DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 4 YEARS, 44 DAYS
WHERE'S OSAMA BIN-LADEN? 3 YEARS, 98 DAYS
DAYS SINCE ENRON COLLAPSE = 1159
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 2
Other Arrests of Execs = 54

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U.S. FUTURES & MARKETS INDICATORS
NASDAQ FUTURES-----------------------------S&P FUTURES

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AT THE CLOSING BELL ON January 18, 2005

Dow... 10,392.99 -78.48 (-0.75%)
Nasdaq... 2,034.27 -11.61 (-0.57%)
S&P 500... 1,167.87 -7.54 (-0.64%)
10-Yr Bond... 4.14% -0.03 (-0.60%)
Gold future... 426.90 +4.30 (+1.01%)





GOLD, EURO, YEN, Dollars and Loonie

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PIEHOLE ALERT

Heads Up!
Preliminary info on appearances by Bush & Co. throughout the country. Details & links are added as they become available so check back. And if you know more, are organizing something, or would like to, contact [e-mail]

For information on protests and other actions Citizens For Legitimate Government

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[54anickel]

1. Stocks Set to Open Higher After Declines (we'll see)

http://biz.yahoo.com/ap/050124/wall_street_2.html

NEW YORK (AP) -- U.S. stocks are set to open higher Monday -- expected to rebound from three consecutive weeks of declines -- although oil prices may unsettle attempts for gains and investors may remain sidelined ahead of Iraq elections Sunday and a rate decision from the Federal Reserve next week.

Dow Jones futures were trading up 17 points recently, while Nasdaq futures were up 4 points and S&P futures were up 2.70 points.

No economic data is expected on Monday.

snip>

The Dow Jones Industrial Average closed at a two-month low Friday, and logged losses for the first three weeks of January for the first time since 1982. Notably, 1982 also marked the start of the bull market that ended in 2000. Analysts blamed the stock weakness on a litany of concerns, including rising oil prices, the election in Iraq, and the prospect of another interest-rate hike when the meets on Feb. 2.

On Friday, the Dow fell 78.48, or 0.8 percent, to 10,392.99, its lowest close since Nov. 10. The blue-chip industrial average lost 165.01, or 1.6 percent, on the week, which was its fourth down week in a row. So far this year, the Dow has lost 390.02, or 3.6 percent.

The Nasdaq Composite Index lost 11.61, or 0.6 percent, Friday to end at 2,034.27, part of a weekly slide of 53.64, or 2.6percent. In the first three weeks of January, the Nasdaq has lost 141.17, or 6.5 percent.

The Standard & Poor's 500 Index fell 7.54, or 0.6 percent, to 1,167.87, and dropped 16.65, or 1.4 percent on the week. The index is down 44.05, or 3.6 percent, this year.

more...

[54anickel]

2. Today's WrapUp by Tim W. Wood 01.21.2005

http://www.financialsense.com/Market/daily/friday.htm

THE DOW REPORT
The China Syndrome

The growth seen in China over the last several years has been spectacular to say the least. When these trends begin it is always easy to look back at such growth and extrapolate that trend into the future. Furthermore, the fundamental picture always looks the worst at bottoms and the best at tops. Yes, I know the fundamentals are looking up for China. Unfortunately, the current technical picture of the Hang Seng Index does not support a continued boom for China, at least not until the looming correction has hit bottom. In fact, the current technical picture is warning that there may be a sizable downturn ahead for China in spite of the positive fundamental outlook.

snip>

So, my technical work is telling me that odds favor a down turn for China and potentially a significant one. I will add that there is a high likelihood that this down turn is about to begin unfolding and should be confirmed with a break below the October 2004 low.

At the outside I would say that the Hang Seng could perhaps hold on for one more intermediate term cycle advance as the divergence builds even more. But, in either case the Hang Seng is setting up for a major fall. These divergences are like pressure that builds up deep within the earth along the fault lines. The more the pressure builds the greater the earthquake that follows. Unless these technical conditions are corrected China is setting up for a financial earthquake. This quake could occur with a small reading on the Richter scale. But, current indications are that we should expect something of greater magnitude that may just rock the entire world.

I believe that China is about to enter Phase II of the great global bear market. If it’s actually true that China has been responsible for so much of the “recovery” since 2002 then imagine what might happen if they do see a down turn. You have been warned!

more...

[54anickel]

3. Delusion, Confusion and Approaching Disconfirmation

http://www.prudentbear.com/archive_comm_article.asp?category=Guest+Commentary&content_idx=39802

As 2004 fades into memory many wait on the edge of their seats for that huge rally. We already had it folks! A passing familiarity with 2004 suggests that the period from late October provided us with a powerful, return-saving surge. This updraft was born of roller coaster crude, falling dollars and the rising Republican electoral tide. It was fed by the needs of professionals to return on assets, almanac inspired confusion between correlations, and causations and delusions of success.

Market pundits and various TV hucksters have made a cottage industry of widely reporting correlations as causations. The late year surge, the benefits of incumbent re-election and the profit growth in economic recoveries come to mind as examples. However, financial histories are not always set to play on loop. Thus, as contexts change so do the results of events, real and imagined. Almost three years into a jobless recovery, more imagined than real, investors should be waking up to this. Sadly, I hear loud snoring.

The global and domestic economies are in upheaval. The basic macroeconomic organization and function of the US is changing rapidly. Mid-quintile earnings have been stagnant for several years as debt levels rise. Likewise, the global economy is experiencing the end of an epoch, and the violent struggle to define new laws of motion. Free trade globalization is being replaced by increasingly hot and bilateral struggle and emerging alliance blocks. This is clear from Chinese and Indian energy deals, South American trade association wrangling, EU enlargement struggles and chaotic battles for control over former Soviet areas of influence. This would seem likely to call into serious question the passive assumption that past noise correlations are the stuff of prudent strategy moving forward.

America imports ever more with softening dollars at rock bottom interest rates financed by foreign credit extension. The tax system is in flux. Pensions and Social Security sureties are in the process of a contested and uncertain re-articulation. The position of the US in the world is changing along with our economic importance. The response to all this has been an assumption that the best of the recent past will repeat for 2005. This expectation is confusing because it is based on several basic confusions.

more...

[JNelson6563]

4. "Shunning dollar"

In this DU thread: http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x1177956

ze_dscherman has posted articles talking about foreign banks shunning the dollar:


Dollar at mercy of central banks

By Chris Giles, Economics Editor
Published: January 24 2005 02:00 | Last updated: January 24 2005 02:00

During the past few years the US has become dependent, not so much on millions of investors around the globe but on a few individuals in a few of the world's central banks.

In 2003, the most recent year with full international statistics, central banks financed 83 per cent of the US current account deficit, with Asian central banks accounting for 86 per cent of flows.

A similar picture is emerging for 2004. Despite a good start to the year, when the private sector was a large net purchaser of dollar assets, central banks came to the rescue again. The People's Bank of China has let it be known that China increased dollar reserves by $207bn (€159bn) in 2004, financing nearly a third of the US current account deficit, estimated at $650bn.

Self-interest has supported much of this flow of cash. The US has lapped up cheap finance to fund its unquenchable appetite to spend. Asian governments have until now been keen to oblige, in order to keep their currencies from appreciating. But all investors have their limits and they may start worrying about their degree of exposure.

http://news.ft.com/cms/s/bd52ee06-6dad-11d9-ae0d-00000e...

There is also a BBC article in that initial post.

With the push of a button China could cause chaos for US economy and yet the Rethugs seem to have no problems with our increasingly precarious position. Short-sighted fools.

Julie

[54anickel]

5. GULP! Thanks for posting this Julie - I hadn't seen it...n/t

[RawMaterials]

6. Trading dollars for euros

http://money.cnn.com/2005/01/24/commentary/column_hays/hays/index.htm

NEW YORK (CNN/Money) - A report out today showing that central banks around the world are growing a bit less enamored of dollars could kick up some dust today.

The Financial Times is touting a report published by a group that monitors global central banks which shows that those surveyed have started to reduce their official holdings of dollars in favor of euros. And the central bank money managers said they now find Eurozone investments to be as attractive as U.S. investments.

[54anickel]

10. Flows Soar on Post-Election Equity Aberration (Sucker's?)

http://www.forexnews.com/AI/default.asp

Capital flows into the US soared 68% to a 5-month high of $81 billion in November after slumping to a 12-month low in October. The figure stood comfortably above the $60 billion trade deficit, temporary alleviating worries of a shortfall in the defict financing.

POSITIVES

The most striking positive was the 317% surge in net foreign inflows into US equities to $14.5 billion, posting their BIGGEST INCREASE SINCE MAY 2001. The notable surge was largely a reflection of post-election optimism with US stocks on the rationale that the 2004 tax cuts would be made permanent. This also helps explain the 4% rise in the S&P500 in November, which pushed the index to a 3-year high. The election aberration argument is very much supported by the fact that the average monthly inflows between January and October stood at $480 million compared to the $14.5 billion surge in November.
snip>

NEGATIVES

The $16.1 billion jump in net purchases of FOREIGN EQUITIES by US RESIDENTS was the highest since July 2000, underlining the quest by US residents to seek foreign alternatives to US assets. Recall, that the October drop in net flows was mainly caused by a $12.6 billion increase into foreign equities.

Most strikingly, is that the post-election dollar tumble in November did not repeal foreign investors from US treasuries. Considering the 6% and 4% drop in the dollar against the euro and the yen, there was a strong possibility for investors to shun US equities. We had seen such an occurrence in September 2003 when foreign flows into the US plunged to -$4 billion after the dollar collapsed by more than 6% in less than 3 weeks following the G7 signaling further dollar decline in Dubai that month.

Looking ahead, considering the high probability that the $14.5 billion in net equity inflows was a post- election aberration, we expect these flows to revert to their more representative trend (Jan-Oct average of $482,000 and 2003 average of $3.1 billion). Combining this tendency with the recent escalation in US appetite for foreign equities, the scales could easily tip the net flow figure back into the $40-50 billion, territory, well below the $60 billion monthly deficit attained in November.

With the monthly growth in US imports and exports averaging 1.0% and 0.7% respectively since January 2003, and with imports standing 60% greater than exports, a continuation of the current trend could push up the trade deficit beyond the $70 billion mark by next October. Only in the unlikely event that US exports grow twice as much as imports--such as 2% exports and 1% imports—would the deficit have more realistic ways of reversing.

more...

[54anickel]

7. Dollar Watch

http://quotes.ino.com/chart/?s=NYBOT_DXY0&v=s

Last trade 83.20 Change -0.06 (-0.07%)

Settle 83.26 Settle Time 23:36

Open 83.15 Previous Close 83.26

High 83.50 Low 83.01


The March Dollar was lower overnight due to light profit taking and is breaking out below the 10-day moving average crossing at 83.18. Stochastics and the RSI are diverging and are turning bearish signaling that a short-term top is in or is near. Closes below the 20-day moving average crossing at 82.49 would confirm that a short-term top has been posted while opening the door for a larger-degree decline into the end of January. Multiple closes above the 25% retracement level of the May- December decline crossing at 83.71 are needed to extend the short covering rebound off December's low. Overnight action sets the stage for a steady to weaker tone in early-day session trading.

The March Euro was higher overnight as it extends last Friday's short covering rebound off the 38% retracement level of the April-December rally crossing at 129.550. Stochastics and the RSI are oversold and beginning to turn bullish signaling that a short-term low might be in or near. Closes above the 10-day moving average crossing at 130.958 would signal that a short-term low has likely been posted. If March extends this month's decline, the 50% retracement level of the April- December rally crossing at 127.290 is the next downside target. Overnight action sets the stage for a steady to firmer tone in early-day session trading.

The March British Pound was slightly higher overnight due to short covering as is consolidates above the 38% retracement level of the May- December rally crossing at 1.8564. Stochastics and the RSI have turned bullish signaling that a short-term low is in or is near. Closes above the 20-day moving average crossing at 1.8787 are needed to confirm that the correction off December's high has come to an end. If March extends this year's decline, the 50% retracement level crossing at 1.8292 is the next downside target. Overnight action sets the stage for a steady to firmer tone in early-day session trading.

The March Swiss Franc was higher overnight due to short covering as it extends its rebound off last Friday's low, which spiked below the 38% retracement level of last year's rally crossing at .8421. Stochastics and the RSI are oversold and are turning neutral to bullish signaling that a short-term low is in or is near. Closes above the 20-day moving average crossing at .8581 are needed to confirm that a short-term low has been posted. If March extends its decline off December's high, the 50% retracement level of last year's rally crossing at .8276 is the next downside target. Overnight action sets the stage for a steady to firmer tone in early-day session trading.

The March Canadian Dollar was higher overnight due to short covering as it consolidates some of last week's decline and is trading above the 25% retracement level of the May-November rally crossing at .8174 and the 20-day moving average crossing at .8208. Stochastics and the RSI are turning neutral hinting that a short-term low might be in or is near. If March extends last week's decline, the reaction low crossing at .8062 then .8018 are the next downside targets. From a broad perspective March needs to close above .8369 or below .8018 to confirm a breakout of this winter's trading range. Overnight action sets the stage for a steady to firmer tone in early-day session trading.

The March Japanese Yen was lower overnight as it consolidates some of last Friday's rally and remains below the 10-day moving average crossing at .9781. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near-term. If March extends last week's decline, a test of the 25% retracement level of last year's rally crossing at .9629 is the next downside target. Overnight action sets the stage for a steady to weaker tone in early-day session trading.


Dollar Drops Amid Rising Oil

http://www.forexnews.com/NA/default.asp

The dollar is down across the board as oil prices prolong their rise for a second day after the snowstorm in the Northeast of the US brought up forecasts of more inclement weather, boosting demand for heating fuel. Crude prices for March delivery rose to 66 cents to $49.19 per barrel, in after-hours electronic trading in afternoon Pacific trade, the highest level since late November. An explosion that killed 10 people near the office of Iraqi PM Allawi’s is the latest sign of escalating daily violence in Iraq. With the violence escalating further in Iraq ahead of the Jan 30 elections, the onset of more bloodshed and the probability of a key officials being murdered, oil prices will likely regain the $50 per barrel, even if OPEC decides a to pump more oil in its Jan 30 meeting. Such prospects could have a renewed negative impact on the dollar, especially if prolonged oil rise is seen provoking US imports on the upside.

Dollar improves under specs’ wings

Speculators continued favoring the dollar against the major currencies, except for the Aussie amid the hawkish rhetoric from the Fed last week affirming the path towards higher interest rates. EUR net longs fell 38% to 9,913 contracts, while JPY net longs fell 67% to 7,879 contracts, the lowest net long since traders were net short in Oct 2004. GBP net longs fell 13% to a 13-week low of 18,715 contracts, and CAD net longs fell 44% to 5,500 contracts, the lowest net longs level since June. CHF net longs plunged 1933% to 1,100 contracts, the first negative in October. The Aussie net longs 4.8% to 27,215 contracts.

BoJ minutes mulled reducing liquidity

Yen is pressured by oil’s rebound considering Japan’s high dependence on the fuel. But the minutes of the Bank of Japan Dec 16-17 board meeting showed that the central bank considered reducing liquidity by lowering its account balance target. Although policy board members at the meeting voted unanimously to hold overall monetary policy steady for the 15th consecutive meeting, the minutes showed some members expressed an interest in gradual reduction of the target range. Policy board members have long held that they will continue their policy of quantitative easing in order to achieve positive inflation and sustainable growth. We expect the policy change to begin unraveling in late Q1. Such a change would be yen positive.

USDJPY nudges higher towards the 103 facing resistance at 103.40--the 50% retracement of the drop from the 105.12 high through the 101.66 low. Accumulated gains stand at 103.82—the 61.8% retracement of the said move. Support starts at 102.50, followed by backed by 102.30 and 102.

Euro nears $1.31 amid rising oil

more...

[54anickel]

8. Pre-opening yada

9:15AM : S&P futures vs fair value: +2.9. Nasdaq futures vs fair value: +4.0. Expectations remain set for a slightly higher open for the cash market, as futures indications hold steady above fair value... Some notable analyst actions include upgrades on the Consumer Staples and Energy sectors from Smith Barney as well as upgrades on the Oil Services & Offshore Drilling sectors from Banc of America... Bear Stearns has downgraded the Telecom sector while Smith Barney has downgraded the Information Technology sector
9:00AM : S&P futures vs fair value: +2.2. Nasdaq futures vs fair value: +4.0. Futures trade continues to indicate a slightly higher open for the indices as investors digest the last of this morning's earnings reports... Better than expected results from KMB, LXK and ETN have provided some support for a market rebound, but not significant enthusiasm, as roughly a quarter of the S&P 500 components have now posted relatively encouraging results... Dow component American Express (AXP) will release Q4 (Dec) earnings during market hours

8:30AM : S&P futures vs fair value: +1.4. Nasdaq futures vs fair value: +1.0. Still shaping up to be a flat to modestly higher open for the cash market... Reports suggest that the $1.25 bln deal between IBM and Lenovo Group may be running into trouble over U.S. security concerns while Hewlett-Packard (HPQ) is considering a management reorganization... It is also being reported that General Motors (GM) and Fiat are in talks about a possible breakup that could further worsen their finances

8:00AM : S&P futures vs fair value: +0.9. Nasdaq futures vs fair value: +1.0. Futures market versus fair value suggesting a flat to slightly higher open for the cash market as investors embark on the busiest week of earnings season. Speculation that three consecutive weeks of declines this year have exaggerated fears of slowing profit growth has contributed to some of the early interest as there is little else in the way of market-moving news and no economic data to digest until tomorrow

6:23AM : S&P futures vs fair value: +2.5. Nasdaq futures vs fair value: +3.5.

6:23AM : FTSE...4786.80...-16.50...-0.3%. DAX...4173.02...-40.68...-1.0%.

6:23AM : Nikkei...11289.49...+51.12...+0.5%. Hang Seng...13386.99...-94.03...-0.7%.


And from INO...

The March NASDAQ 100 was slightly higher overnight due to light short covering as it consolidates some of last week's decline but remains below the 50% retracement level crossing at 1517.25. Stochastics and the RSI are bearish but oversold hinting that a short-term low might be in or is near. If March extends this year's decline, the 62% retracement level crossing at 1487.10 is the next downside target. Closes above the 10-day moving average crossing at 1547.05 would signal that a short- term low has been posted. The March NASDAQ 100 was up 4.00 pts. at 1513.50 as of 5:41 AM ET. Overnight action sets the stage for a steady to higher opening by the NASDAQ composite index later this morning.

The March S&P 500 index was slightly higher overnight due to short covering as it consolidates some of last week's decline but remains below the 25% retracement level of the August-January rally crossing at 1181.85. Stochastics and the RSI are oversold but remain bearish signaling that additional weakness is possible near-term. If March extends this year's decline, a test of the 38% retracement level crossing at 1160.65 is the next downside target. Closes above the 10-day moving average crossing at 1181.42 would signal that a short-term low has been posted. The March S&P 500 Index was up 2.40 pts. at 1171 as of 5:43 AM ET. Overnight action sets the stage for a steady to firmer opening when the day session begins later this morning.

[54anickel]

9. Spending Capital Wisely (Roach)

http://www.morganstanley.com/GEFdata/digests/20050121-fri.html#anchor0

In his post-election press conference of early November, President Bush famously said, “I’ve earned capital in this election and I’m going to spend it…” In his second inaugural address, the President gave every indication of sticking with this promise. This could be a very challenging commitment insofar as economic policy is concerned. While Mr. Bush is hardly lacking in political capital, financial capital is another matter altogether for a saving-short US economy. That poses two critical and related questions: Who will foot the bill for these bold initiatives? Will they solve America’s biggest economic problems?

An important hint to the answer of both questions was contained in the recently released November data on US trade and capital flows. The trade deficit, of course, ballooned to a record $60.3 billion, whereas net foreign buying of long-term US securities surged to $81 billion in the same month. These numbers hardly came out of thin air. In my view, they are telltale signs of the only incremental funding option available to a saving-short US economy -- the need to import surplus saving from abroad and run massive current-account and trade deficits in order to attract that capital. They provide a very direct answer to the first question: As long as America’s domestic saving rate remains woefully deficient, any policy proposals which exert a further drain on aggregate saving will have to be funded by foreign savers.

That takes me to the second question -- America’s most serious problem. In my view, it’s all about saving. Unfortunately, recent trends are especially worrisome on that front. The net national saving rate -- the combined saving of households, businesses, and the government sector all adjusted for the depreciation of worn-out capital -- stood at just 0.9% in 3Q04 (latest official data point) and has averaged only 1.5% since early 2002. That’s a record low in the modern-day post-World War II experience of the US economy. The recent plunge in national saving reflects the combined impacts of an extraordinary compression of household saving -- the personal saving rate was only 0.5% in 3Q04 -- and an unprecedented deterioration in government saving as the federal budget swung dramatically from surplus to deficit over the past several years. In a world where saving must always equal investment, a chronic saving shortfall eats away at the sustenance of long-term economic growth for any nation. For that simple reason, I continue to believe that America’s saving deficiency is its most serious economic problem.

It is against that backdrop that I believe we must evaluate the basic thrust of the economic policy agenda of the second Bush Administration. And from that perspective, I have serious misgivings. Under the general rubric of the so-called “ownership society” -- privatization of social security, healthcare saving accounts, lifetime retirement accounts, private pension revamping, and tax reform -- a major reworking of economic policy is being proposed. My concerns are not about the philosophical and political merits of this debate. It’s hard to quibble with the noble objectives of ownership -- asking individuals to take on greater responsibility for their own economic destiny. Instead, my concerns are those of the steely-eyed national income accountant. What worries me as I put on my green eyeshade are the impacts of shifting ownership on national saving. In my view, these proposals do basically nothing to address America’s biggest problem -- an unprecedented shortfall of national saving.

snip>

Largely for those reasons, I now favor a consumption tax -- specifically a national sales tax ....GACK! :scared:

more...

[JNelson6563]

11. 10:03 update

Dow 10,398.09 +5.10 (+0.05%)
Nasdaq 2,031.30 -2.97 (-0.15%)
S&P 500 1,168.33 +0.46 (+0.04%)
10-Yr Bond 4.144% +0.004

Which way will we go?

Julie

[54anickel]

13. Dang! I'm just a bit too slow...n/t

[54anickel]

12. 10:05 EST numbers and yada

Dow 10,399.57 +6.58 (+0.06%)
Nasdaq 2,031.85 -2.42 (-0.12%)
S&P 500 1,168.78 +0.91 (+0.08%)
10-yr Bond 41.46 +0.06 (+0.14%)
30-yr Bond 46.42 -0.01 (-0.02%)
NYSE Volume 188,228,000
Nasdaq Volume 314,141,000

9:40AM: Market shrugs off Friday's weakness and opens higher, in line with futures indications, following better than expected earnings reports and concerns the market has been oversold... While lackluster action on the part of buyers so far in 2005 is rather typical during the early part of earnings season, as the market usually rallies only after worries over individual stocks producing negative surprises subside, investors appear to be seeking bargains in a market that has so far overstated worries about decelerating earnings growth...

[54anickel]

14. Look Both Ways: Spending Cautiously (Consumer confidence slipping)

Whatever the price of gas and the state of the housing market, and even in contrast with consumer spending, consumer confidence seems to be slipping.

http://www.cfo.com/article.cfm/3595742/c_3595749?f=home_todayinfinance

As inflationary concerns remain almost nonexistent and the housing market shows renewed resilience heading into this week — the last full week before the next Federal Open Market Committee policy announcement— economists are almost uniform in their predictions that moderate growth will prevail and that Fed policy will remain unchanged during 2005.

Wednesday's report on the consumer price index from the Bureau of Labor Statistics showed overall consumer inflation down 0.1 percent in December, the first decline since July, driven by a 3.4 percent drop in the price of petroleum-based products. Core inflation, which excludes the more volatile food and energy components, rose 0.2 percent, the same as in November.

Another potential concern about the economy was also temporarily alleviated last Thursday when the Department of Commerce reported 2.004 million housing starts in December, up sharply from the revised 1.807 million for November. While this number was about 3 percent lower than the figure for December 2003, the release nonetheless reassured analysts concerned about a possible "housing bubble" by coming in higher than expected.

snip>

Richard Curtin, who directs surveys conducted by the university's business school, told CFO.com that the index "declined slightly because consumers have become more concerned about a potential shortfall in job growth over the next year and a half." Another drag on the index was consumers' assessment the economy over the next five years, observed Curtin; this assessment alone declined by 12 percent from the previous month.

"Consumers recognize that inflation is going down mortgage rates are still very low," said Curtin. He also noted that despite the latest drop, "the index in January was equal to the average level we recorded for the past 12 months," and he expects that the confidence level will remain largely unchanged through the first half of 2005.

Looking ahead this week:

more...

[54anickel]

15. Behind the numbers, Fannie Mae, GM are struggling

They may beat the Street estimates. But their earnings reports -- and those of many other companies last week -- give investors plenty of reasons to worry.

http://moneycentral.msn.com/content/P102179.asp?Printer

When companies implode slowly, folks often erroneously conclude that all is well. When Enron came unstuck, it unraveled slowly at first, before dropping from about $38 to $4 in two weeks.

To my eyes, Fannie Mae (FNM, news, msgs) is a train wreck moving in slow motion when -- in this modern world of finance, and given Fannie's balance sheet -- one would think the wreck would occur at the speed of light.

No sane person can now draw any other conclusion about Fannie Mae than that its business is forever changed, from what is believed to have been and what it was.

As Jim Grant said in the most recent issue of "Grant's Interest Rate Observer," "Before the scandal, Fannie's business model was one part simplicity, another part privilege and a third part audacity: Borrow at a government-advantaged rate; invest at a slightly higher rate. Leverage the balance sheet as no private enterprise could. Grow and grow. Deliver predictable, stair-step earnings growth."

That pretty much sums up what Fannie Mae's business plan used to be. Any time it was threatened, it invoked the sacred word, "homeownership." That got anyone hassling the mortgage lender off its back.

more...

[54anickel]

16. PENNY-STOCK PAYDAY

http://www.nypost.com/business/39157.htm

January 24, 2005 -- LAST week we poked through the hodge podge of conflicting information that a North Carolina-based stun-gun company called Law Enforcement Associates Corp. (LEA) has filed with the Securities and Exchange Commission over the last couple of years.
Now, still more information has come to light showing how the company's filings helped hide the role that a North Carolina politician named John H. Carrington played in orchestrating the sale of his family's law-enforcement supply business to a Nevada penny-stock company in December 2001.

Public investors were never informed — by Carrington or anyone else — that at the time of the sale, Carrington himself controlled both sides of the penny-stock deal, making all that followed inherently suspicious, whatever the deal's terms eventually turned out to be.

Until recently, investors in the shares have done well. Law Enforcement Associates' stock price has risen from pennies per share to a peak two weeks ago of $12.70 on market excitement over news that the company would soon be introducing a "non-lethal electric stun gun" for the law-enforcement market. But stun-gun stocks are now falling, with LEA's share price tumbling nearly 46 percent in little more than the last week. The slide has been worsened by LEA's own top brass, who have emerged as big sellers of shares in their own company.

According to federal filings last week, the company's president, Paul Feldman, sold 14 percent of his LEA stock for roughly $800,000 during the preceding workweek, and his boss, Carrington, LEA's controlling shareholder, pocketed a similar amount from stock sales of his own. Neither man returned phone calls for comment about their stock sales or several related matters.

more...

[54anickel]

31. A Better Way to Get Zapped

http://www.fool.com/News/mft/2005/mft05012420.htm

Over the past few days I've gotten plenty of frantic email about some of what I've said about Taser International (Nasdaq: TASR). Those of you who think it's all part of the vast short-selling/liberal/conservative/Martian conspiracy might want to refresh your memories about what really loses money for investors: lack of proper regard for what the guys steering the ship are going to do to your wallet.

Another common refrain -- or whine -- is that we don't give equal time to the up-and-coming stun gun players, Law Enforcement Associates (OTCBB: LENF) and Stinger Systems (Pink Sheets: STIY).

Frankly, I'm puzzled that an investor would need any warning about these stocks. How can I make this easy to understand? If stocks are race cars, owning Taser is like driving at 120 mph. You might do OK, or you might crash and burn. Owning LEA or Stinger is like driving 120 with no seatbelt, no brakes, and no steering wheel. It's a near guarantee of fiery destruction.

LEA's major product is, like so many Johnny-come-lately security companies, press releases. Its next-generation stun gun that is claimed to be superior to Taser's? Still vaporware. Parse this statement from a recent press release very carefully, "Commenting on the testing, Paul Feldman, President of LEA stated 'To be able to achieve these results in our comparison test using our SLA engineering model against our competitor's finished product is remarkable.'"

more...

[54anickel]

17. The Cash Heads Home

I came across this article while looking for a non-subscription version of "Repatriated cash raises M&A hopes - FT ($) (1/23/2005 8:26 PM)" linked at Prudent Bear.

This is from December, but still relevant to the subject.

http://www.businessweek.com/magazine/content/04_52/b3914027_mz011.htm

For a one-time tax break, companies could repatriate $300 billion next year. But what will they do with it?

It's a cash bundle that would have made Howard Hughes blush: As U.S. multinationals such as IBM (IBM ) and Pfizer Inc. (PFZ ) have extended their reach across the globe, they've built up a mountain of profits earned abroad -- as much as $750 billion, by some estimates. That's more than the annual economic output of Hong Kong, Ireland, and Switzerland -- combined. And up till now, they've kept all that moolah overseas, much of it in tax havens such as the Bahamas, Ireland, and Singapore to avoid the stiff 35% levy they'd face if they repatriated the funds back into the U.S.

But now it looks as if Corporate America is gearing up to bring a chunk of that cash home. Thanks to a provision in the corporate tax law enacted in October, Congress is giving multinationals the chance to repatriate profits earned before 2003 and held in foreign subsidiaries at an effective 5.25% tax rate. To qualify for that rate, the money has to be brought back to the U.S. before the end of 2005, and spent in ways that stimulate job creation and the economy.

As a result, economists are expecting as much as $300 billion to come washing ashore next year, as companies seize the chance to lock in at the ultralow tax rate. Outfits as varied as Intel (INTL ), 3M (MRK ), and Heinz (HNZ ) expect to repatriate gobs of cash, potentially using it for everything from refurbishing aging plants and shoring up balance sheets to launching acquisition sprees. And while the injection is not expected to produce many jobs, it should provide a nice jolt to the economy and a lift for the stock market.

snip>

And what about using some of the money to expand payrolls -- the stated intent of the law? Don't bet on it. With companies wringing ever-higher levels of productivity out of their current workforce -- and reluctant to take on the obligations that come with new hiring -- economists doubt that a repatriation of profits will lead to a wholesale hiring boom. Indeed, Sinai expects the repatriation rush to create just 118,000 jobs in each of the next five years -- far less than the 500,000 that politicians promised. But if this cash surge keeps the economy humming a while longer, that may be a trade-off lawmakers are willing to make.

more...

There's more to that Jobs Creation tax break than creating jobs. There's been speculation in the markets that this will offer a boost to the dollar and the stock market. IMHO, it's not really about creating jobs it's about saving the US economy from collapse.
JPMorgan Chase speculates that the legislation would likely generate $100 billion of demand for dollars in 2005. We'll have to wait and see. (From this article: http://www.reuters.com/financeNewsArticle.jhtml?type=businessNews&storyID=7388917)

[54anickel]

18. Home-equity loans hit record $431 bil in 2004

http://www.azcentral.com/arizonarepublic/business/articles/0124equityloans24.html

Taking advantage of rising property values, record numbers of homeowners are turning to home-equity loans as a source of easy cash.

Overall, home-equity originations climbed 35 percent last year to a record $431.3 billion, according to SMR Research Corp., a market-research firm in Hackettstown, N.J. Most of the growth has been in variable-rate lines of credit that are tied to the prime rate, currently 5.25 percent.

Countrywide Financial Corp. originated $30.9 billion in home-equity loans last year, a 71 percent increase. In a conference call last week, Wells Fargo & Co. said its home- equity volume jumped 45 percent last year.

A home-equity line of credit gives a homeowner the right to borrow up to a certain amount, either all at once or as needed. Borrowers pay interest only on the amount withdrawn. Home-equity loans provide borrowers with a lump sum and carry fixed rates.

As competition heats up - and rising rates make refinancings less attractive - lenders are looking for new ways to boost this market. U.S. Bancorp recently tested a home-equity line that rewards borrowers over time. Under the program, the rate on the credit line drops by one-quarter of 1 percentage point every six months during the first two years.
Betting on the side of the bond vigilantes? :shrug:

snip>

The rise in home-equity lending may reflect a more fundamental shift in consumer borrowing habits. "Home equity lending is displacing other forms of consumer credit," such as credit cards and first mortgages, Morgan Stanley analyst Kenneth Posner said.
As UIA would say, "You CAN eat your house".

[54anickel]

19. Inflation picking up a bit of momentum

China effect masks underlying price pressures, economists say

http://www.msnbc.msn.com/id/6853497/

Excluding energy, consumer prices rose a modest 2.2 percent last year, according to year-end government figures released this week. But that seemingly benign figure conceals growing inflation pressures that could bedevil policy-makers this year, some economists believe.

By any measure inflation is accelerating. The so-called "core" inflation rate, which ignores food and energy costs, rose 2.2 percent compared with 1.1 percent in 2003, when the possibility of deflation became the dominant concern for Federal Reserve Chairman Alan Greenspan and his colleagues. Overall consumer prices rose 3.3 percent last year, up from 1.9 percent in 2003.

But last year's increases understate the true inflationary pressures, said Anirvan Banerji, research director of the Economic Cycle Research Institute.

“Inflation pressures are simmering more than most people acknowledge,” he said.

He observes that for so-called “tradable” goods, such as apparel, electronics, cars and furniture, inflation is declining or prices actually are falling, especially when adjusted for rising quality. To put it another way, manufacturers and retailers have no pricing power in industries where there is a “China price.”

But service-related areas are largely immune to these forces of globalization, and they are subject to growing inflation as the expansion ages. College tuition is perhaps the prime example. Tuition and fees are up 42 percent over the past five years, a period in which overall prices have risen only 13 percent. The costs of medical care and personal services also are rising much faster than inflation.

more...

[54anickel]

20. 11:15 and dipping into the red

Dow 10,389.89 -3.10 (-0.03%)
Nasdaq 2,026.61 -7.66 (-0.38%)
S&P 500 1,167.93 +0.06 (+0.01%)
10-yr Bond 41.42 +0.02 (+0.05%)
30-yr Bond 46.38 -0.05 (-0.11%)
NYSE Volume 492,275,000
Nasdaq Volume 730,978,000

11:00AM: More of the same as stocks continue to fluctuate around the flat line despite solid quarters from a handful of companies... Kimberly-Clark (KMB 64.90 +1.12) beat analysts' forecasts by a penny and guided for Q1 while both Lexmark (LXK 84.92 +1.01) and Eaton (ETN 65.20 -0.20) beat expectations and issued in-line Q1 guidance... While the peak week of earnings is upon us, with reports from 152 S&P constituents and nearly half (12) of the Dow components out this week, investors still appear somewhat indecisive, however, as most major indices still hover close to levels not seen since December...
NYSE Adv/Dec 1499/1450, Nasdaq Adv/Dec 1212/1558

10:30AM: Choppy trading keeps the indices bouncing around the unchanged mark trying to gain traction in the early going... Despite virtually every sector attracting buyers in the first half hour of trading, sellers have stepped in to minimize gains... Energy has shown the most strength, climbing in response to higher oil prices and a sector upgrade from Banc of America, while financial has trade higher following a record quarter from Legg Mason (LM 75.45 +4.75) and in anticipation of solid results from American Express (AXP 51.98 +0.05) out later today...

Also trading higher have been utility, telecom services, hardware, drug and materials while airline, semiconductor, networking, disk drive, retail and consumer staples have been weak...XOI +1.3, NYSE Adv/Dec 1411/1398, Nasdaq Adv/Dec 1066/1620


Advances & Declines
NYSE Nasdaq
Advances 1381 (43%) 1142 (38%)
Declines 1615 (50%) 1679 (56%)
Unchanged 198 (6%) 161 (5%)

--------------------------------------------------------------------------------

Up Vol* 182 (43%) 229 (34%)
Down Vol* 227 (54%) 417 (63%)
Unch. Vol* 7 (1%) 11 (1%)

--------------------------------------------------------------------------------

New Hi's 67 32
New Lo's 26 44


edit to add adv/dec and for html, whoops and time

[54anickel]

21. John Snow's Selective Vision on Dollar Pegs

http://quote.bloomberg.com/apps/news?pid=10000039&refer=columnist_pesek&sid=a93dXFKF7Dpw

Jan. 24 (Bloomberg) -- Of all the questions facing Malaysia's outlook, none is as intriguing -- or arguably as important -- as its currency peg with the U.S. dollar.

Making the rounds here in Kuala Lumpur, the subject comes up time and time again. Yet there's something odd about all this: The relaxed way in which government officials and business people discuss the highly sensitive issue of the ringgit's six-year-old dollar peg.

snip>

``There is no timeframe but, as I've said before, no regulation is cast in stone,'' a calm Abdullah said recently. ``The peg will remain for the time being. There is no change at this point in time.'' It echoed recent comments by his predecessor, Mahathir Mohamad, who pegged the ringgit at 3.8 to the dollar in 1998 to curb speculation during the Asian financial crisis.

Why So Calm?

It's no mystery why Malaysian officials seem so calm about this touchy issue: They don't have the Bush administration breathing down their necks.

Odd, considering U.S. Treasury Secretary John Snow more or less declared war on pegged currencies during President George W. Bush's first term. Yet only China seems to be on the hot seat. Getting a pass on U.S. pressure are Malaysia and Hong Kong, two economies better prepared to float their currencies than China.

Isn't it surprising Bush hasn't dispatched Snow to Malaysia to force a currency change? Doesn't it strike anyone as odd that U.S. Commerce Secretary Donald Evans didn't deride Hong Kong's dollar peg while he visited the mainland recently?

Actually no, and the reason why exposes the White House's motivation -- politics, and nothing but.

more...

[ozymandius]

22. Howdy all! Here are noontime numbers.

------------------------------------------------------------------------
 Market Summary
------------------------------------------------------------------------
Dow 10,410.58 +17.59 (+0.17%)
Nasdaq 2,029.16 -5.11 (-0.25%)
S&P 500 1,170.50 +2.63 (+0.23%)
10-Yr Bond 4.142% +0.002
NYSE Volume 615,125,000
Nasdaq Volume 882,550,000

[54anickel]

23. Good Day Ozy! Hope all is well with you and yours. Great to see you.

[ozymandius]

24. Thanks a bunch.

I am just taking a little break - just enough time to check in here to see what is happening with the world.

I read enough here to feel okay about using the three one-dollar bills in my pocket as napkins.

Until later...

[54anickel]

27. Heh-heh...

[Timefortruth]

25. DJIA 10,441.61 +48.62

kick

[JNelson6563]

26. thanks for the kick!

:hi:

1:33 snapshot:

Dow 10,433.34 +40.35 (+0.39%)
Nasdaq 2,030.49 -3.78 (-0.19%)
S&P 500 1,172.15 +4.28 (+0.37%)
10-Yr Bond 4.142% +0.002

What's with the flat-line in the 10 yr? :shrug:

Julie

[MARALE]

28. Looks like the pixies have used all their dust up n/t

[54anickel]

29. The dust (like the buck) just doesn't go very far these days. 2:39 EST

Dow 10,413.30 +20.31 (+0.20%)
Nasdaq 2,022.06 -12.21 (-0.60%)
S&P 500 1,169.09 +1.22 (+0.10%)
10-yr Bond 4.124% -0.016
30-yr Bond 4.609% -0.034
NYSE Volume 1,067,906,000
Nasdaq Volume 1,544,621,000

2:30PM : Stocks show little vigor, having moved little in the past half hour... Touching their highs of the day, however, have been treasuries, with demand greatest for the longer-dated instruments (i.e. 30-year notes) since inflation remains well contained... The benchmark 10-year note has also picked up steam, lifting 5 ticks to yield 4.12%, despite trading relatively unchanged most of the day as comments from Atlanta Fed President Guynn merely matched those made at a speech on Jan 10...NYSE Adv/Dec 1589/1645, Nasdaq Adv/Dec 1232/1821
2:00PM : Stocks trade at improved levels although the recent recovery effort seems to have stalled... On the Dow, American Express (AXP 52.50 +0.57) has recently released Q4 earnings, beating analysts' Q4 forecasts by a penny on record earnings and revenues... McDonald's (MCD 31.83 +0.58), after CIBC upgraded the fast food giant to Sector Outperform citing competitive advantages over rival Wendy's (WEN 37.35 -0.40), has also helped the Dow... Procter & Gamble (PG 55.30 -0.35), however, has fallen after valuation concerns prompted UBS to downgrade the stock to Neutral from Buy...

The Dow, which had not fallen for the first three weeks of the year since 1982, has so far recovered roughly half of the 0.8% it lost last week...NYSE Adv/Dec 1664/1560, Nasdaq Adv/Dec 1219/1813

1:30PM : Market improves its stance as blue chips and technology stocks continue to trade in opposite directions... One area in focus today has been the drug sector, as the AMEX Pharmaceutical Index (DRG +0.3%) has rebounded slightly from last week's 1.6% decline... Shares of Novartis (NVS 48.48 +0.62) have surged after Prudential upgraded the drug maker to Overweight from Neutral-Weight citing strong revenue growth and low patent exposure...

Also gaining ground has been Bayer (BAY 32.46 +0.14) after it received FDA approval for hepatitis A and B tests while Schering-Plough (SGP 20.29 +0.30), which is believed to be in early clinical testing with a drug targeting hepatitis C, has also traded higher... Pfizer (PFE 24.50 +0.02), which opened up 1.0% after a study showed that its Viagra drug may reduce heart enlargement and a federal appeals court upheld a ruling in PFE's favor, has clung to modest gains... NYSE Adv/Dec 1632/1566, Nasdaq Adv/Dec 1192/1794

1:00PM : Major indices remains mixed as market internals still hold a slightly bearish bias... Decliners on the NYSE hold a slim 16 to 14 margin over advancers while declining issues on the Nasdaq hold an 18 to 11 edge over advancing issues... Down volumes on both the Big Board and Composite outpace up volumes, with activity on the latter holding a 2 to 1 advantage as volumes on the Nasdaq have recently surpassed 1.0 bln shares while shares exchanging hands on the NYSE have yet to hit 800 mln...

Meanwhile, the Nasdaq continues to test its early Nov support levels near 2026/2023 while both the S&P 500 and the Dow hold a more upbeat bias but still test resistance levels near 1172/1173 and 10417/10425, respectively, which has marked congestion and the Dec lows reached last Friday... NYSE Adv/Dec 1472/1683, Nasdaq Adv/Dec 1128/1836

12:30PM : Little change since the last update as the major averages continue to vacillate in roughly the same ranges... Meanwhile, transportation has been a focal point today as Dow Transport and S&P 500 constituent Union Pacific Corp (UNP 60.01 -0.40) has recently posted Q4 results... While the railroad operator beat analysts' expectations and reaffirmed an improved outlook for FY05, high energy prices and increased operating costs knocked profits down 86%, keeping the stock under pressure...

Competitors NSC (-2.8%), BNI (-0.8%) and CSX (-0.5%) have also traded lower while the only area keeping the index in positive territory has been strength in trucking and courier services like FDX (+2.5%), UPS (+1.0%) and YELL (+1.4% )... DJTA +0.4, NYSE Adv/Dec 1544/1594, Nasdaq Adv/Dec 1167/1781

12:00PM : Stocks trade in split fashion midday as overall sentiment remains cautious due to ongoing earnings concerns... While thoughts of an oversold market and better than expected results from the likes of ETN, KMB and LXK prompted early buying interest, investors have been rather hesitant to show more enthusiasm as the bulk of this week's earnings are still forthcoming... Higher crude oil prices ($48.60/bbl +$0.07), following heavy snowstorms over the weekend as well as continued worries surrounding the Jan. 30 OPEC meeting and Iraqi elections, has also minimized gains in equities...

Taking advantage of strength in oil, however, has been energy (+1.5%) while financial, on the heels of record Q3 (Dec) results from Legg Mason (LM 74.38 +3.68), has also traded higher... Also showing strength have been utility, telecom services, transportation and hardware... Airline (-3.6%) has been hammered again, adding to last week's 8.6% drubbing, while semiconductor, under pressure following downbeat remarks from Infineon Technologies (IFX 9.06 -0.28), has traded lower... Also weak have been networking, biotech, retail, materials, disk drive and consumer staples...

Meanwhile, treasuries have held a tight range most of the morning with no economic data to digest until tomorrow, as the benchmark 10-year note remains unchanged yielding 4.14%...NYSE Adv/Dec 1536/1565, Nasdaq Adv/Dec 1157/1741

[54anickel]

30. China: One Coin, Two Faces

http://www.321gold.com/editorials/mauldin/mauldin012305.html

When Will China be Larger Than the US?
250,000 Engineers a Year and Counting
The Greatest Migration in History
It's a Long, Long Way to Chongqing
La Jolla, Fatherly Pride and Great Wines

This week we begin what will be a series of occasional letters on China. The topic, like the country, is so vast that it cannot be adequately dealt with in one short letter. Today, we will take a long range view into the future, looking at how China will develop vis-a-vis the developed world.

There is a mountain of material on China, as I can personally attest to, having gone through hundreds of pages of reports, essays, and data in the past few weeks. Much of the writing falls into two camps, it is like they are holding the same coin but only looking at one of the two sides. The first camp sees China as an emerging empire which will eclipse Europe and the US in a few decades, offering a rival military power to balance a uni-polar world. They will stop purchasing US debt, precipitating a major decline in the US and force us into a long and permanent recession. After reading some of the extremes of this group, I feel like buying a shovel and digging a hole so we can just go ahead and bury ourselves.

And then there are the Chinese skeptics. Yes, they admit, China is a good story today, but when the inevitable crisis comes along China will not be able to maintain its stability. China is dependent upon massive amounts of foreign investment, which will at some point dry up. Its recent boom is construction related, and that cannot continue. It has huge pollution problems; a top down administrative economy which almost never works, and is creating more and more problems; cannot sustain its pace of growth because there will simply not be enough energy; will have a major crisis when its people demand an end to the massive and pervasive corruption and desire true democracy; has a banking system that is essentially bankrupt; has no real system of capital markets and so on and so on.

Things rarely happen at the extremes. And it is my belief that China will not evolve at the extremes as well. China is an odd mix of problems that will have to be dealt with and opportunities that will shape our world in ways far different than we might now imagine.

Who could predict, merely 25 years ago, that the US would be for all intent and purpose the sole world Super-Power? That Europe would be united with one currency and a market size greater than the US? That Eastern Europe would have free democratic elections and an exponent of flat taxes? That Russia would be a third world country with nukes? That China would be moving rapidly to becoming a free market powerhouse and major supplier (and creditor) to the US?

more...

[On the Road]

32. Could be a Couple of Up Weeks

The Equity and OEX Put/Call Ratios generally signal overbought and oversold conditions that help identify price tops and bottoms; however, sometimes the OEX Put/Call Ratio will invert relative to the Equity Put/Call Ratio. At these times the inversion signals the opposite of what we would normally expect.

Here's how I think this works. The Equity P/C Ratio represents the activity of speculators (the little guys) who become more and more committed to price direction until it reverses on them, therefore the Equity P/C Ratio becomes oversold at price bottoms and overbought at price tops.

The OEX P/C Ratio reflects hedging activity by big money. These guys tend to lighten up as the price trend becomes more extreme, preparing for the inevitable reversal, so the OEX P/C Ratio can become overbought at bottoms and oversold at tops -- the opposite of what happens to the Equity P/C Ratio.

http://www.decisionpoint.com/ChartSpotliteFiles/050121_PCratio.html

-------------

I find Carl Swedlin to be one of the most astute technicians around. He called the recent runup in July, but I didn't listen because I couldn't believe the market would rally going into the fall:

http://www.decisionpoint.com/ChartSpotliteFiles/040820_PMO.html

This time I cash out my short positions, if only for a few weeks. I would not want to be long after April, or possibly much after January.

[54anickel]

33. There’s a good time and a better time to invest; now is a less-better time

http://www.jsonline.com/bym/invest/jan05/295682.asp

snip>

Over the last century, the average U.S. stock returned almost 10% per year, including dividends. But that number is misleading because it’s the result of averaging wildly diverse annual returns.

You’ll hear all kinds of happy talk about how stocks always do well over the long term, but in the long term we’re all dead.

The harsh reality is that investors unlucky enough to buy at the wrong time could earn piddling returns for more than a decade.

Since the 1920s, there have been two such dry spells.

The first began in September 1929 and lasted until April 1942. The second started in November 1968 and continued through July 1982.

snip>

In a nutshell, deflationary forces created by the assimilation of emerging economies into the developed world has forced central banks to keep interest rates unusually low, thus inflating asset bubbles in everything from stocks, to bonds, to gold, to energy, to steel, to real estate.

The bottom line is that cash is cheap and virtually everything else is expensive. Such a time is not the best time to buy.

more...

[54anickel]

34. 3:34 numbers and blather

Dow 10,404.96 +11.97 (+0.12%)
Nasdaq 2,016.96 -17.31 (-0.85%)
S&P 500 1,167.59 -0.28 (-0.02%)
10-yr Bond 4.122% -0.018
30-yr Bond 4.606% -0.037
NYSE Volume 1,278,434,000
Nasdaq Volume 1,842,322,000

3:30PM : Equities show some resilience, bouncing off session lows, but the market averages remain mixed heading into the close of trading... Earnings abound tomorrow as 26 S&P 500 constituents will report earnings before the bell, three of which include Dow Industrials DD, JNJ and MRK... After the bell, 11 more of this week's 152 S&P components will release earnings, with special emphasis on leaders like TXN, CTX and EXC... In economic news, January Consumer Confidence (consensus 101.3) and December Existing Home Sales (consensus 6.8 mln) will be released at 10:00 ET...NYSE Adv/Dec 1364/1934, Nasdaq Adv/Dec 984/2113

3:00PM : A renewed wave of selling, prompted by a breakdown in technical resistance levels, pushes the major indices toward their lows of the session... The Nasdaq has been hit the hardest after failing to find support near the 2017 level while the Dow and S&P continue to trade below resistance levels of 1172 and 10417, respectively... Meanwhile, gold futures ($427.10/oz +$0.20) have extended Friday's 1.0% gain, closing above $427/ounce for the first time since January 5, as the dollar has held steady against the euro (1.3046) and yen (102.71)...

The safe-haven commodity and the greenback have marched in lock step with one another for months (negative correlation) as traders have also maintained a wary eye on Iraq, ahead of the Jan 30 election, and crude oil prices ($48.81/bbl +$0.28)...NYSE Adv/Dec 1416/1856, Nasdaq Adv/Dec 1047/2034

2:30PM : Stocks show little vigor, having moved little in the past half hour... Touching their highs of the day, however, have been treasuries, with demand greatest for the longer-dated instruments (i.e. 30-year notes) since inflation remains well contained... The benchmark 10-year note has also picked up steam, lifting 5 ticks to yield 4.12%, despite trading relatively unchanged most of the day as comments from Atlanta Fed President Guynn merely matched those made at a speech on Jan 10...NYSE Adv/Dec 1589/1645, Nasdaq Adv/Dec 1232/1821

2:00PM : Stocks trade at improved levels although the recent recovery effort seems to have stalled... On the Dow, American Express (AXP 52.50 +0.57) has recently released Q4 earnings, beating analysts' Q4 forecasts by a penny on record earnings and revenues... McDonald's (MCD 31.83 +0.58), after CIBC upgraded the fast food giant to Sector Outperform citing competitive advantages over rival Wendy's (WEN 37.35 -0.40), has also helped the Dow... Procter & Gamble (PG 55.30 -0.35), however, has fallen after valuation concerns prompted UBS to downgrade the stock to Neutral from Buy...

The Dow, which had not fallen for the first three weeks of the year since 1982, has so far recovered roughly half of the 0.8% it lost last week...NYSE Adv/Dec 1664/1560, Nasdaq Adv/Dec 1219/1813

1:30PM : Market improves its stance as blue chips and technology stocks continue to trade in opposite directions... One area in focus today has been the drug sector, as the AMEX Pharmaceutical Index (DRG +0.3%) has rebounded slightly from last week's 1.6% decline... Shares of Novartis (NVS 48.48 +0.62) have surged after Prudential upgraded the drug maker to Overweight from Neutral-Weight citing strong revenue growth and low patent exposure...

Also gaining ground has been Bayer (BAY 32.46 +0.14) after it received FDA approval for hepatitis A and B tests while Schering-Plough (SGP 20.29 +0.30), which is believed to be in early clinical testing with a drug targeting hepatitis C, has also traded higher... Pfizer (PFE 24.50 +0.02), which opened up 1.0% after a study showed that its Viagra drug may reduce heart enlargement and a federal appeals court upheld a ruling in PFE's favor, has clung to modest gains... NYSE Adv/Dec 1632/1566, Nasdaq Adv/Dec 1192/1794

1:00PM : Major indices remains mixed as market internals still hold a slightly bearish bias... Decliners on the NYSE hold a slim 16 to 14 margin over advancers while declining issues on the Nasdaq hold an 18 to 11 edge over advancing issues... Down volumes on both the Big Board and Composite outpace up volumes, with activity on the latter holding a 2 to 1 advantage as volumes on the Nasdaq have recently surpassed 1.0 bln shares while shares exchanging hands on the NYSE have yet to hit 800 mln...

Meanwhile, the Nasdaq continues to test its early Nov support levels near 2026/2023 while both the S&P 500 and the Dow hold a more upbeat bias but still test resistance levels near 1172/1173 and 10417/10425, respectively, which has marked congestion and the Dec lows reached last Friday... NYSE Adv/Dec 1472/1683, Nasdaq Adv/Dec 1128/1836

12:30PM : Little change since the last update as the major averages continue to vacillate in roughly the same ranges... Meanwhile, transportation has been a focal point today as Dow Transport and S&P 500 constituent Union Pacific Corp (UNP 60.01 -0.40) has recently posted Q4 results... While the railroad operator beat analysts' expectations and reaffirmed an improved outlook for FY05, high energy prices and increased operating costs knocked profits down 86%, keeping the stock under pressure...

Competitors NSC (-2.8%), BNI (-0.8%) and CSX (-0.5%) have also traded lower while the only area keeping the index in positive territory has been strength in trucking and courier services like FDX (+2.5%), UPS (+1.0%) and YELL (+1.4% )... DJTA +0.4, NYSE Adv/Dec 1544/1594, Nasdaq Adv/Dec 1167/1781

12:00PM : Stocks trade in split fashion midday as overall sentiment remains cautious due to ongoing earnings concerns... While thoughts of an oversold market and better than expected results from the likes of ETN, KMB and LXK prompted early buying interest, investors have been rather hesitant to show more enthusiasm as the bulk of this week's earnings are still forthcoming... Higher crude oil prices ($48.60/bbl +$0.07), following heavy snowstorms over the weekend as well as continued worries surrounding the Jan. 30 OPEC meeting and Iraqi elections, has also minimized gains in equities...

Taking advantage of strength in oil, however, has been energy (+1.5%) while financial, on the heels of record Q3 (Dec) results from Legg Mason (LM 74.38 +3.68), has also traded higher... Also showing strength have been utility, telecom services, transportation and hardware... Airline (-3.6%) has been hammered again, adding to last week's 8.6% drubbing, while semiconductor, under pressure following downbeat remarks from Infineon Technologies (IFX 9.06 -0.28), has traded lower... Also weak have been networking, biotech, retail, materials, disk drive and consumer staples...

Meanwhile, treasuries have held a tight range most of the morning with no economic data to digest until tomorrow, as the benchmark 10-year note remains unchanged yielding 4.14%...NYSE Adv/Dec 1536/1565, Nasdaq Adv/Dec 1157/1741

Advances & Declines
NYSE Nasdaq
Advances 1386 (40%) 980 (30%)
Declines 1911 (55%) 2114 (65%)
Unchanged 154 (4%) 136 (4%)

--------------------------------------------------------------------------------

Up Vol* 480 (40%) 431 (24%)
Down Vol* 705 (58%) 1306 (73%)
Unch. Vol* 10 (0%) 30 (1%)

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New Hi's 85 49
New Lo's 33 74

[spotbird]

35. The week opens in the red.

DJIA 4:04:37 PM 10,368.61 -24.38

[DoBotherMe]

36. Closing numbers and blather

Dow 10,374.07 -18.92 (-0.18%)
Nasdaq 2,009.52 -24.75 (-1.22%)
S&P 500 1,164.18 -3.69 (-0.32%)
10-Yr Bond 41.22 -0.18 (-0.43%)

NYSE Volume 1,442,518,000
Nasdaq Volume 2,085,440,000

Close: The market opened higher in the wake of solid quarterly results and worries over an oversold market, but traded in split fashion most of the day only to close at new lows for the fourth consecutive session... Overall sentiment, despite showing early promise yet again, remained cautious due to ongoing fears related to decelerating earnings growth which prompted further consolidation and pushed the market averages through key technical levels to their lowest levels of the day...
Crude oil ($48.81/bbl +$0.28), closing at its highest level in nearly two months, also added pressure to equities throughout the session... The commodity climbed in response to higher demand for heating oil following heavy snowstorms across the Northeast as well as uncertainty ahead of the Iraqi elections and OPEC's meeting on Jan 30... Despite virtually every sector attracting buyers at the open, follow through from sellers kept gains minimal most of the day and closed most sectors in negative territory... Losing the most ground was airlines, which extended last week's 8.6% defeat with a 4.5% sell off, while technology was weak across the board...

Losses greater than 1.0% were seen in software, networking, disk drive and semiconductor, with downbeat comments from chipmaker Infineon Technologies (IFX 9.00 -0.34) pressuring the latter... Biotech, retail and materials also lost in excess of 1.0% while health care and transportation relinquished early gains... Energy (+1.0%) bucked the bearish trend, however, following a sector upgrade from Banc of America and higher oil prices, while financial posted modest gains following record quarterly results from American Express (AXP 52.70 +0.77) and Legg Mason (LM 74.95 +4.25)

Also closing higher was telecom services, getting a boost from a rebound in Verizon Communications (VZ 36.87 +0.37), and utility, which took advantage of lower bond yields... Treasuries, which traded relatively unchanged most of the day with no economic data to digest, found some late-day buying interest which pushed the benchmark 10-year note up 5 ticks to yield 4.12%, levels not seen since mid December... Gold ($427.10/oz +$0.20) closed above $427/ounce for the first time since January 5, as the dollar held relatively steady against the euro (1.3063) and yen (102.55)...DJTA -0.5, DJUA +0.8, DOT -2.1, Nasdaq 100 -1.5, Russell 2000 -1.1, SOX -1.7, S&P Midcap 400 -0.6, NYSE Adv/Dec 1314/2024, Nasdaq Adv/Dec 916/2219

[54anickel]

37. Ouch! What happened in that last 1/2 hour?

[JNelson6563]

38. Just couldn't keep above the water line

Has the PPT shut down this year or what?

Catch all you marketeers tomorrow! :hi:

Julie

[54anickel]

39. You get what you pay for (On a fun note)

http://www.prudentbear.com/randomwalk.asp

The man said there would be live entertainment, which is what you’d expect at something billed as an “Inauguration Gala.” And he said there would be food and that if we paid a little extra, we could sit at table full of “big hitters” and that influence would be so thick we could cut it with one of the five forks stationed next to the dinner plate. They always have five forks at inaugural dinners, he said.

I thanked the man for the offer, and felt darned lucky to have been presented with it. Had I arrived at 7-11 one minute later, I would have missed this once-every-four-years opportunity, but there he was…next to the empty milk crates with two tickets left.

Alas, I had neither a tux nor a plane ticket to Washington and that’s what I told him. Instead of nodding, he looked at me like I had asked if he’d ever watched Fear Factor.

“The dinner’s is here in Dallas,” he said. “Well, a suburb of Dallas. I mean it’s a growth area. You just take the Interstate and you’ll get there in no time. Plus, you get to watch the whole shebang on a big screen tv, you know, virtual-like. And you don’t have to deal with that whole Washington scene, you know, listening to people say they work for the Undersecretary of the Undersecretary but that the Oversecretary has shown an interest in their abilities. Oh, and the dress is business casual. You don’t need a tux.”

So I gave him the twenty dollars and he scrambled across the parking to explain the opportunity to a guy at the gas pump before I could thank him. I guess he realized he had another couple of tickets, and I hadn’t bought the last ones after all.

Maybe the “business casual” should have been a hint that the “Virtual Inauguration Gala” was not the groundbreaking social event the 7-11 guy said it was. This became more obvious when we discovered that the party wasn’t in a hotel Grand Ballroom, but in a roadside Denny’s with some tables pushed back to allow for a makeshift dance floor over by a giant orange booth. There was no big screen TV, no vicarious participation in the various Washington galas. Just on an old Emerson portable tuned to the Weather Channel. It lwas cold in D.C.

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