STOCK MARKET WATCH, Friday 30 December

[ozymandius]

Friday December 30, 2005

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 3 YEARS, 23 DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 1835 DAYS
WHERE'S OSAMA BIN-LADEN? 1534 DAYS
DAYS SINCE ENRON COLLAPSE = 1496
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 3
Other Arrests of Execs = 54


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




AT THE CLOSING BELL WHEN BUSH TOOK OFFICE on January 22, 2001
Dow - 10,578.24
Nasdaq - 2,757.91
S&P 500 - 1,342.90
Oil - $27.69/bbl
Gold - $266.70/oz.

AT THE CLOSING BELL ON December 29, 2005

Dow... 10,784.82 -11.44 (-0.11%)
Nasdaq... 2,218.16 -10.78 (-0.48%)
S&P 500... 1,254.42 -3.75 (-0.30%)
10-Yr Bond... 4.38% -0.00 (-0.05%)
Gold future... 517.50 +1.20 ( +0.23%)






GOLD, EURO, YEN, Dollars and Loonie


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

[ozymandius]

1. Wall Street hit by late sell-off

Wall Street closed in negative territory on Thursday after a last-hour sell-off in technology and blue chip stocks forced the leading indices to relinquish their morning gains.Some analysts suggested that investors might have been unnerved by the continued inversion of the US Treasury yield curve. For the third consecutive day, yields on 10-year US Treasuries ventured below those on two-year paper, sustaining concerns that they signalled a coming slowdown in the US economy.Those fears were compounded by a string of new economic data - including a rise in first-time jobless claims and a drop in existing home sales.Existing home sales in November declined to an eight-month low, leaving the number of houses on the market at the highest level since 1986. The data suggested that the housing market was continuing its steady slowdown, and overshadowed a stronger than expected reading of manufacturing activity.

more...

[ozymandius]

2. One report today -

Dec 30 10:00 AM Chicago PMI Dec
Briefing Forecast NA
Market Expects 60.0
Prior 61.7

[ozymandius]

3. Inverted yield curve to cool housing market

NEW YORK (Reuters) - The bond market is popping the dreams of home ownership for some Americans.

Home buyers who can only afford to buy homes with lower adjustable-rate mortgages (ARMs), those who can scrape into a house with more "exotic" loans with low teaser rates, and some investors contemplating second home purchases could be soon shut out as short-term rates rise, analysts said.

The ARM "was a creative and good product in the market that was utilized by a lot of savvy consumers and that's been great. But having said that, an ARM is no longer really an attractive option for the new home shopper, especially in this inverted yield curve," said Robert Foregger, chief strategy officer at EverBank, in Stowe, Vermont.

more...

[UpInArms]

47. Mortgage rates down slightly, but higher for year

http://www.usatoday.com/money/perfi/housing/2005-12-29-mortgages_x.htm?POE=NEWISVA

WASHINGTON (Reuters) — Average interest rates on 30-year fixed rate mortgages continued their December decline, dropping to 6.22% this week from 6.26% last week, mortgage finance company Freddie Mac reported Thursday.

Rates on 15-year mortgages dipped to an average of 5.76% in the week ending Thursday from 5.79%, Freddie Mac said.

"Lower figures for the recently released producer price index and consumer price index and lower, but still strong, gross domestic product combined with the seasonal slowdown in the housing market led to another decline in mortgage rates this week," Amy Crews Cutts, Freddie Mac deputy chief economist, said in a statement.

For the year, the 30-year mortgage rate averaged 5.87%, she said, adding that it averaged 5.84% in 2004.

<snip>

A year ago rates averaged 5.81% on 30-year mortgages, 5.23% on 15-year mortgages and 4.19% on the one-year adjustable rate mortgages (ARM). This week, the ARM dropped to an average of 5.15% from 5.22%.

...more...

[UpInArms]

59. Inverted yield curve to whack hedge funds and banks

http://www.marketwatch.com/news/print_story.asp?print=1&guid={19A081A9-653C-422C-83BB-7EC520F4CF2E}&siteid=mktw

excerpt:

The shape of the curve - it's been flat for much of the year -- has impacted stock trading this week and continues to be a focus of hedge funds and banks, which can no longer borrow at cheaper short-term rates to fund loans and other investments with longer terms and in normal conditions, higher returns.

[Dogmudgeon]

4. The Last Trading Day of the Year

The overseas markets have already started out with a quick drop (as of 6 AM).

By 4PM, I wonder how many tea leaves we'll have in our empty cup?

--p!

[ozymandius]

7. tea leaves in an empty cup...

Prognosticators say that mere possession of a cup will be a blessing in 2006.

[ozymandius]

8. Stocks could see rough road in '06

-cut-

Stocks zigzagged for much of the year before finding some momentum in the fourth quarter -- a typical pattern for the market. However, the strong October-November rally lost steam in December, leaving the overall gains for the year modest.

-cut-

Most of the gains were the result of the big fall rally. Analysts argue that the rally may be the last big move up for stocks for some time, until perhaps the second half of 2006.

-cut-

But countering that is worries about the country's growing debt burden, both for consumers and for the government. Some analysts think the dollar could weaken next year, which could also be negative for stocks.

And there's the threat to consumer spending from the slowing housing market, which cuts into refi money, and stubbornly high energy prices, which reduce disposable income.

more...

[54anickel]

21. I've said it before, just compare the numbers in the opening post

between yesterday's close and when WhistleAss took office 5 friggen years ago.

And what was the debt at the close of fiscal 2001?
09/28/2001 $5,807,463,412,200.06

All that added debt and what have we got to show for it?

[UpInArms]

44. What we have to show for the debt is a negative savings rate

and no clear way out.

:(

[ozymandius]

5. Oil Prices Remain Above $60 a Barrel

SINGAPORE - Oil prices held above $60 on Friday after the U.S. government released data showing a significant drop in domestic gasoline inventories.

Light, sweet crude for February delivery dropped 16 cents to $60.16 a barrel in electronic trading on the New York Mercantile Exchange by midafternoon in Singapore. Oil had surged 50 cents on the previous day.

Heating oil dropped marginally to $1.7010 a gallon, while gasoline dropped slightly to $1.6455 a gallon.

The U.S. Department of Energy said Thursday that the supply of gasoline declined by 1.2 million barrels last week to 202.9 million barrels, or 6 percent below year ago levels. Gasoline futures traded on the New York Mercantile Exchange climbed 6.13 cents to settle at $1.624 per gallon.

more...

[UpInArms]

27. Feb Crude @ $59.90 bbl - Feb NatGas @ $10.97 mln btus

10:17am 12/30/05 FEB CRUDE FALLS 42C TO $59.90/BRL IN EARLY NY TRADING

10:17am 12/30/05 FEB NATURAL GAS DOWN 25.3C, OR 2.3%, AT $10.97/MLN BTUS

[UpInArms]

33. Oil falls under $60, but set for a 45% gain on year - NatGas has 92% gain

http://www.marketwatch.com/news/story.asp?guid=%7BB46E84E4%2D5ABE%2D4106%2D922F%2D64F0D9C1DB58%7D&symbol=&siteid=mktw

SAN FRANCISCO (MarketWatch) -- Oil futures fell back below $60 a barrel Friday, but prices were ready to close out the year with a more than 45% gain.

Crude for February delivery was last trading down 37 cents at $59.95 a barrel on the New York Mercantile Exchange.

Energy trading on the exchange will close at 1 p.m. Eastern, in anticipation of Monday's New Year's holiday.

The crude contract closed at its highest level in two weeks Thursday after supply data showed a bigger-than-expected decline in gasoline and distillate inventories in the latest week. See full story.

A year ago, the crude contract closed at $41.24 a barrel.

January unleaded-gasoline futures were down 1.24 cents at $1.64 a gallon, and January heating oil was off 1.04 cents at $1.6925 a gallon.

...more...

http://www.chron.com/disp/story.mpl/ap/business/3555919.html

Oil prices slipped below $60 a barrel on Friday, but were up about 42 percent from the start of the year, buoyed by increased demand and events that constrained supplies, such as the war in Iraq and hurricanes in the Gulf of Mexico.

For similar reasons, there was an even sharper advance in 2005 in the price of natural gas, which surged 92 percent, making it more expensive to produce electricity, manufacture goods and heat homes.

Many analysts believe the average price of oil will be below $60 in 2006, though not by much as U.S. and Chinese economic growth continues and hawkish members of OPEC, such as Venezuela and Iran, express growing interest in a production cut as early as the first quarter.

...more...

(edited to add additional link and information)

[UpInArms]

58. Feb Crude @ $60.90 bbl

12:44pm 12/30/05 FEB CRUDE CLIMBS 58C TO $60.90/BRL IN NY

[UpInArms]

61. Feb Crude closes @ $61.04 bbl - up 48% from one year ago

1:37pm 12/30/05 FEB CRUDE CLOSES AT $61.04/BRL, UP 72C FOR THE DAY

1:37pm 12/30/05 FEB CRUDE ENDS UP 48% FROM THE CONTRACT'S YEAR-AGO CLOSE

[UpInArms]

62. Feb NatGas closes @ $11.225 mln btus - up 82.6% from 12/20/2004

1:58pm 12/30/05 FEB NATURAL GAS CLOSES AT $11.225/MLN BTUS, UP 0.2C ON DAY

1:58pm 12/30/05 NATURAL-GAS FUTURES UP 82.6% FROM DEC. 20, 2004 CLOSE

[ozymandius]

6. Bitter end?

NEW YORK (CNNMoney.com) - So much for a Santa Claus rally -- U.S. stock markets are poised for another sour session Friday, putting the Dow industrials at risk of a losing year in 2005's final session.

-cut-

Friday's trading is expected to be light with many participants taking an early holiday. But market watchers are going to be keeping a sharp eye on the Dow industrials' close Friday. The blue chip index is up less than 2 points for the year and is at risk of finishing 2005 in negative territory.

Oil prices edged lower, hovering just under $60 a barrel. The February light crude futures contract for NYMEX dipped 47 cents to $59.85 a barrel in electronic trading, while the February contract for Brent crude slipped 40 cents to $57.67.

For the fourth day in a row, the Treasury yield curve inverted, with the yield on the 10-year note falling below that of the 2-year note. An inverted yield curve is often interpreted as a signal for an upcoming recession and is putting pressure on market sentiment, although several economists point out that the connection doesn't always apply.

more...

[UpInArms]

9. daily dollar watch

http://quotes.ino.com/chart/?s=NYBOT_DX

Last trade 91.18 Change +0.36 (+0.40%)

China must beware dollar fall - bank adviser

http://www.chinadaily.com.cn/english/doc/2005-12/30/content_508098.htm

excerpt:

But Yu warned that the United States might stop raising interest rates in 2006 and start guiding the dollar downward, putting upward pressure on the yuan.

"More seriously, China's economy would take a big hit if the U.S. dollar weakened sharply due to such factors as a bursting of the U.S. property bubble," he said. "The loss for China's foreign exchange reserves would be extremely serious."

At the end of September China had $769 billion in foreign exchange reserves, the world's largest after Japan's.

Yu has previously said the dollar, which has strengthened on global markets in recent months, would be vulnerable as long as the United States ran a huge current account deficit.

...more...

[UpInArms]

12. China OKs First Batch Of Yuan Forex Mkt-Makers

http://sg.biz.yahoo.com/051230/15/3xkkw.html

SHANGHAI (Dow Jones)--In another step toward more currency flexibility, China's foreign exchange regulator gave its approval to the first batch of foreign and local banks to act as yuan market makers, banking sources said Friday.

Market makers are obliged to quote bid and offer rates, which will provide greater liquidity to the market and help make foreign exchange trading more active.

<snip>

"This will help improve the liquidity in the dollar-yuan market," said Kenneth Poon, ABN AMRO's head of trading in China.

"Market volatility is also likely to increase," Poon added.

<snip>

Both systems are expected to kick off on Wednesday, when the forex market opens next year.

...more...

[UpInArms]

34. Analysts: U.S. Currency to Fall in 2006

http://www.chron.com/disp/story.mpl/ap/business/3554871.html

NEW YORK — After a surprise 2005 in which the dollar rose, against the predictions of many analysts, the U.S. currency is likely to fall in 2006. But exactly when and how hard, they say, will depend largely on how the U.S. interest rate story plays out.

The consensus among currency analysts these days seems to be that the fortunes of the dollar will depend, much like this year, on the trajectory of interest rates in the United States and globally.

But while the focus on interest rates isn't expected to change, the story itself is. In 2005, the dollar lifted steadily as the Federal Reserve continued raising short term interest rates in the United States, bringing them to 4.25 percent by the end of the year. Rates in the euro zone and Japan, meanwhile, remained largely stagnant. But in 2006, the key for major currency markets will be the end of the Fed's rate raising cycle, and the degree to which the euro zone and Japan will be raising rates.

"The most eye-catching phenomenon as we head into 2006 is the transition in global monetary policy," says Larry Kantor, chief market strategist at Barclays Capital in New York.

...more...

[54anickel]

40. You know, I've always wondered about the buck's rise in 2005.

Was it really dollar strength based on rising interest rates that attracted those investors? I mean those rates weren't exactly stellar. I wonder how much of it was fear of another currency crisis somewhere in the world as a result of the higher borrowing costs. Maybe a fear of a repeat of the Mexican peso or Argentina crisis? :shrug:

[UpInArms]

42. Dollar Heads for First Annual Gain in Four Years as Rates Rise

http://www.bloomberg.com/apps/news?pid=10000100&sid=awFwMYyo_CgI&refer=germany

Dec. 30 (Bloomberg) -- The dollar headed for its first annual gain in four years against the euro and yen as the Federal Reserve widened the interest-rate gap with Europe and Japan.

The U.S. currency is poised for its biggest rally versus the euro since 1999, the year the 12-nation currency was introduced, and climbed 14.8 percent against the yen. The Fed raised its target rate eight times, the European Central Bank lifted its key rate once and the Bank of Japan held rates at zero percent.

<snip>

``The dollar, and foreign exchange markets in general, have been driven by rates and yield this year,'' said Tim Fox, a currency strategist at Dresdner Kleinwort Wasserstein AG in London. Trading in the foreign-exchange market today dropped to about a third of the average $1.9 trillion, he said.

A lack of liquidity at year-end may be exaggerating swings in exchange rates. The dollar fell to record lows against the euro on each of the last five trading days of 2004. The following week, the dollar rallied 3.1 percent.

``It takes comparably low amounts of orders to trigger moves,'' said Armin Mekelburg, a currency strategist in Munich at HVB Group, Germany's second-largest bank. ``I don't think there's much meaning in it.''

...more...

[54anickel]

54. A lack of liquidity? Hmmmm that doesn't sound good...n/t

[UpInArms]

10. U.S. Treasury urges Congress to raise debt limit

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-12-29T223540Z_01_N29200590_RTRIDST_0_ECONOMY-DEBTLIMIT-UPDATE-1.XML

WASHINGTON, Dec 29 (Reuters) - U.S. Treasury Secretary John Snow warned lawmakers on Thursday that a legally set limit on the government's ability to borrow will be hit in mid-February and urged Congress to raise it quickly.

Failure to do so potentially risks throwing the country into its first default in history, Snow warned in what has become virtually an annual rite as U.S. borrowing needs spiral.

"The administration now projects that the statutory debt limit, currently $8.184 trillion, will be reached in mid-February 2006," Snow said in a letter to 21 members of the U.S. House of Representatives and Senate released by Treasury after financial markets had closed.

Snow said that Treasury, if the debt limit was not raised by then, would have to take "extraordinary actions" to keep paying its bills for everything from Social Security to national defense spending.

Even if Treasury took "all available prudent and legal actions to avoid breaching the statutory debt limit, we anticipate that we can finance government operations no longer than mid-March."

...more...


The estimated population of the United States is 298,113,711
so each citizen's share of this debt is $27,472.18.

The National Debt has continued to increase an average of
$2.83 billion per day since September 30, 2005

Date	Amount         	 	
 	   	 	
09/30/2005	$7,932,709,661,723.50   	 	
09/30/2004	$7,379,052,696,330.32   	 	
09/30/2003	$6,783,231,062,743.62   	 	
09/30/2002	$6,228,235,965,597.16   	 	
09/30/2001	$5,807,463,412,200.06   	 	
09/30/2000	$5,674,178,209,886.86   	 

[UpInArms]

46. Congress May Take Until March to Raise U.S. Borrowing Limit

http://www.bloomberg.com/apps/news?pid=10000103&sid=ahD_jYYGMu.E&refer=us

Dec. 30 (Bloomberg) -- The U.S. Congress may not act on President George W. Bush's request for more borrowing authority until early March, which would force the Treasury to use unusual measures such as shuffling money among government pension funds to finance operations.

Treasury Secretary John Snow told Congress yesterday that the government may reach its statutory borrowing limit of $8.18 trillion by mid-February, and asked lawmakers to raise the debt ceiling ``as soon as possible.'' Congress is unlikely to act ``before the end of February or early March,'' Representative John M. Spratt Jr., the top Democrat on the House Budget Committee, said in an interview.

Snow's request marks the fourth time the Bush administration has asked Congress to let it issue more debt. Congress complied with the last request, in November 2004, only after the Treasury was forced to move money among government pension funds to free up dollars to pay its bills. This time, Snow said, he could finance government operations through mid- March using ``all available prudent and legal actions.''

<snip>

While Snow didn't specify a figure in his request to Congress, Spratt said the ``likely amount'' would be close to the $781 billion in new borrowing authority that House Republicans attempted to add to a budget bill a few weeks ago. This writer really meant to say "attempted to SNEAK into a budget bill so that it could not be debated"

...more...

[UpInArms]

11. Today's Report:

http://biz.yahoo.com/c/e.html

Dec 30	10:00 AM	Chicago PMI	Dec	-	NA	60.0	61.7	-

[UpInArms]

13. Treasurys edge higher, with yield curve still inverted

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38716.3638096759-855889674&siteID=mktw&scid=0&doctype=806&

CHICAGO (MarketWatch) -- Treasurys were modestly firmer amid declines in global stocks and additional year-end "window dressing," for which Treasurys are bought to better match bond portfolios with the major indexes. The benchmark 10-year Treasury note edged up 1/32 to 101 4/32, leaving its yield little changed at 4.36%. The 2-year yield remained higher than the 10-year note's yield, at 4.38%.

[UpInArms]

18. Printing Press Report:Fed adds banking reserves via six-day system repos

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-12-30T143214Z_01_N30343120_RTRIDST_0_MARKETS-FED-OPERATIONS.XML

NEW YORK, Dec 30 (Reuters) - The Federal Reserve said on Friday it added temporary reserves to the U.S. banking system through six-day system repurchase agreements.

The benchmark fed funds rate last traded at 4.00 percent, below the Fed's current 4.25 percent target for the overnight lending rate.

Further details of the operation are available at: http://www.ny.frb.org/markets/omo/dmm/temp.cfm

[UpInArms]

29. U.S. Treasuries rise as curve inversion deepens

http://today.reuters.com/PrinterFriendlyPopup.aspx?type=bondsNews&storyID=uri:2005-12-30T152323Z_01_N30356178_RTRIDST_0_MARKETS-BONDS.XML

NEW YORK, Dec 30 (Reuters) - U.S. Treasury debt prices rose on thin trading on Friday in the last session of 2005, with short-term yields widening their yield premium over longer issues, deepening the so-called yield-curve inversion.

With little data to expect, save for the Economic Cycle Research Institute's weekly indicator on overall economic strength at 10:30 a.m. (1530 GMT), the market was turning its attention to next week's important events.

Those include the release of minutes from the Federal Reserve's Dec. 13 meeting and December data on U.S. manufacturing and non-farm payrolls.

"The rate outlook really comes down to how the economy is doing," said one trader at a primary Treasuries dealer in New York. "If we see a strong payrolls report next week, we could definitely see a big sell-off," he added.

<snip>

The unusual inversion, which has signaled slowdowns and recessions in the past, stood at 2.7 basis points Friday morning.

...more...

[UpInArms]

52. U.S. Treasuries dip as curve inversion deepens

http://today.reuters.com/PrinterFriendlyPopup.aspx?type=bondsNews&storyID=uri:2005-12-30T170720Z_01_N30394379_RTRIDST_0_MARKETS-BONDS-UPDATE-1.XML

NEW YORK, Dec 30 (Reuters) - U.S. Treasury debt prices dipped on thin trading on Friday in the last session of 2005, with short-term yields widening their yield premium over longer issues, steepening the so-called yield-curve inversion.

The session's only data, Economic Cycle Research Institute's weekly indicator on overall economic strength, came in a touch lower, but had no effect on bond prices. Instead, the market was turning its attention to next week's important events.

Those include the release of minutes from the Federal Reserve's Dec. 13 meeting and December data on U.S. manufacturing and non-farm payrolls.

<snip>

The inversion of note yields on the short end of the curve, ongoing for about two weeks, continued, with two-year yields above both three- and five-year note yields.

<snip>

If the Fed raises rates by a quarter-point at its next policy meeting in January, official interest rates would climb to 4.50 percent, or above current 10-year and two-year rates.

That possibility epitomizes the low rate environment that Fed officials say reflects heavy foreign participation in the bond market and which has helped set the stage for this week's inversion of two- and 10-year yields.

...more...

[UpInArms]

64. Treasury market ends 2005 with inverted yield curve

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38716.6035901852-855913906&siteID=mktw&scid=0&doctype=806&

CHICAGO (MarketWatch) -- Treasurys ended lower in price and higher in yield along the maturity spectrum, but Friday's action left the yield curve inverted, or with shorter-dated notes offering higher yields than riskier longer-dated notes. The curve, which had been very flat for much of the year, inverted this week for the first time in nearly six years. The 10-year note finished down 7/32 at 100 28/32 Friday. That subtracts nearly $2.50 per each $1,000 worth of securities. It was yielding 4.39% compared to 4.36% Thursday. The 2-year note was down 1/32 at 99 30/32, yielding 4.40% vs. 4.37% Thursday. The bond market closed one hour early. Financial markets are closed Monday.

[UpInArms]

14. Kozlowski's Mug Shot

http://www.thesmokinggun.com/archive/1101054tyco1.html

NOVEMBER 1--The last time we saw Dennis Kozlowski and Mark Swartz was on September 19, when the pair was sentenced in a New York courtroom for their banditry of Tyco International. The disgraced executives were each hit with prison terms of eight-and-one-third to 25 years and immediately taken into custody (both were convicted in June of grand larceny and other felonies for swiping nearly $200 million from Tyco and manipulating the firm's stock price for $400 million more in personal gain). So here's a first post-sentencing look at jailbirds Kozlowski, Tyco's ex-CEO, and Swartz, the firm's former CFO. The convicted corporate raiders are currently wards of the New York State Department of Correctional Services and are bunking at the maximum security Downstate Correctional Facility in Fishkill, about 80 miles north of Manhattan, where Kozlowski once owned a $20 million apartment and a $6000 shower curtain.

...more...

[ozymandius]

15. pre-open blather

08:31 am : S&P futures vs fair value: -3.5. Nasdaq futures vs fair value: -4.0. The equity market remains poised to start the session lower. Downbeat overseas trade, similarly on very light volume, contributes to the bearish undertone is within the U.S. market. Asian markets underperformed in their most recent session, but major European indices are also chalking losses. With many traders' attention resting upon the Treasury market's yield curve, the current inversion (-2.5 basis points) further weighs upon sentiment.

08:01 am : S&P futures vs fair value: -3.2. Nasdaq futures vs fair value: -4.0. Futures trade indicates a lower open for the stock market's last session of 2005. There is little news to account for the early sentiment, and today's calendar on both the economic and earnings fronts is clear; year-end portfolio clean ups may dictate today's action. Some items of note include reports of Intel's (INTC) marketing makeover and Citigroup's (C) increased bid for the state-owned Chinese lender Guangdong Bank -- but neither issues are having much affect on the morning market.

[UpInArms]

16. The Bugman - Grinning like a fool - Happy to Rip-off the USoA

http://www.thesmokinggun.com/archive/1020051delay1.html

OCTOBER 20--Here's the Tom DeLay mug shot snapped this afternoon when the deposed House majority leader appeared at a Harris County, Texas sheriff's office to be booked on conspiracy and money laundering charges. The Republican pol, 58, was forced to submit to a brief photo and fingerprint session after a District Judge yesterday issued an arrest warrant for him.

...more...

[UpInArms]

17. 9:38 EST a bloody end to a blood year?

Dow 10,747.68 -37.14 (-0.34%)
Nasdaq 2,204.47 -13.69 (-0.62%)
S&P 500 1,248.38 -6.04 (-0.48%)
10-Yr Bond 4.344 -0.32 (-0.73%)

NYSE Volume 68,553,000
Nasdaq Volume 70,701,000

09:35 am : As foreshadowed by futures trade, the equity market opened lower and launched each of the major indices in the red. Like the last four days, volume is expected to be very light today, and especially so as many market participants have gotten an early start to the three-day New Year's weekend. As a reminder, the Treasury market closes at 1:00 ET. There's a dearth of corporate news, a blank earnings calendar, and an empty economic docket today; efforts to make end-of-year portfolio adjustments may dictate trading action. If the S&P, up 3.5% on the year, manages to close on positive turf, it would mark the third consecutive year of gains within the equity market.DJ30 -35.94 NASDAQ -10.08 SP500 -4.44 NASDAQ Vol 42.6 mln NYSE Vol 1.4 mln

(edited to add blather)

[Tace]

19. The 0.004 Percentage Point That Shook the World: Caroline Baum

Dec. 30 (Bloomberg) -- Something momentous happened on Dec. 27, judging from press reports. The yield on the 10-year Treasury note dipped four thousandths of a percentage point (0.004) below the yield on the two-year note.

This inversion between short- and long-term market rates was treated with the same kind of reverence accorded the completion of the human genome project. It merited front-page coverage in Wednesday's Wall Street Journal.

snip

It sounds as if it's time to set the record straight on the yield curve. For starters, almost all of the analytical work on the yield curve's predictive powers has been done with the overnight interbank rate, which is set by the Federal Reserve.

``This more pure measure has a nearly perfect prediction pattern dating back to 1966, with leads of 9-20 months,'' writes Mike Englund, chief economist at Action Economics LLC in Boulder, Colorado. The one false signal was in the latter half of 1998.

more

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

[UpInArms]

30. Setting the record straight - that Bloomberg article is wrong

http://today.reuters.com/PrinterFriendlyPopup.aspx?type=bondsNews&storyID=uri:2005-12-30T152323Z_01_N30356178_RTRIDST_0_MARKETS-BONDS.XML

The unusual inversion, which has signaled slowdowns and recessions in the past, stood at 2.7 basis points Friday morning.

2.7 basis points -- not 0.004 Percentage Point as Caroline Baum wrote.

:shakesheadatlies:

[UpInArms]

48. Bloomberg now has "corrected" column here:

http://quote.bloomberg.com/apps/news?pid=10000039&cid=baum&sid=aieOl4UX6a4E

added this paragraph:

New York Fed economist Arturo Estrella says the three-month Treasury bill rate compared to the 10-year note yield gives the most accurate signal over long time periods. That spread is currently a positive 30 basis points. Estrella prefers monthly averages, using the Fed's constant maturity series to eliminate the noise. It's the ``persistence of yield curve signals'' that is relevant, he says, not a temporary crossing into negative territory.

[converted_democrat]

20. I was just watching CNBC, and they had an analyst on that claims

that he believes stocks will fall at least 10% in the coming year...
I realize that you should not believe everything you here, but isn't 10% a big drop?

[UpInArms]

22. a 10% drop would put the market just under 10,000

and I think that is still a bit high for the economic realities.

:hi:

[converted_democrat]

28. Well, then this should be an interesting year.....

How will the Koolaid crowd spin that into good news?

:hi:

[UpInArms]

31. You bet! They will do their "Rah Rah Rah - Sis Boom Bah" routine!

:hi:

[converted_democrat]

35. Ooohhh, now that's funny....

I love to laugh, but spraying hot coffee out your nostrils isn't all it's cracked up to be....So it's safe to assume you read your mail this morning? Not one of my finer moments, but I felt so much better after I wrote it. Those rah, rah girls really get my goat sometimes.

edited to add-

:spray:

[54anickel]

32. Looking at the 5 year or max chart for the DOW, just under 10K would

probably be a best case scenario. It was the war spending that stopped the free fall. Totally non-productive for the domestic economy outside of military and defense contracts. There's been no real investment in the US economy, it's been money pissed away on an illegal war which won't be flowing back anytime soon. Meantime they've taken the debt to astonomical, unsustainable heights. The "Job Destruction" bill hasn't exactly lived up to expectations either. :eyes: Add Medicare reform, the bankruptcy bill and just about everything the Idgit has pushed through since taking office and you can pretty much see the set up for another great transfer of wealth. I'm keeping my hand over my pocket these days.

http://finance.yahoo.com/q/bc?s=%5EDJI&t=5y&l=on&z=m&q=l&c=

The max chart shows we've been muddling along for the last 5 years - almost a flat line. It's got to move somewhere and I just don't think the chances of a move up from this point anytime soon are very good. If we're lucky we may be able to repeat the flat pattern of 1965 - 1980, but there aren't many tricks left in the bag. Nixon used up the gold trick and Greenspin's been over using rates and the money supply since he took office.

[54anickel]

23. The Mess Greenspan Leaves

http://www.mises.org/story/1985

With Federal Reserve Chairman Alan Greenspan set to retire next month after more than 18 years on the job, it seems appropriate to summarize his performance. Greenspan has been the single most powerful individual in the world in the economic sphere.
By merely changing his choice of words between different speeches he has been able to rattle the markets. When he merely removes or add words like "measured" or "accommodative" somewhere in his speech, the markets either rally or panic. And through his words and his actions he has had a profound effect on the US Economy and the world economy as a whole.

Before he became Fed Chairman, some believers in sound money thought Greenspan might push for a less inflationary monetary policy. They pointed to his past as a close associate of Ayn Rand and author of the "Gold And Economic Freedom" chapter in Rand's Capitalism: The Unknown Ideal. In that chapter, Greenspan argued for a Misesian view of monetary matters, pointing to how monetary inflation lead to confiscation of wealth and destabilizing business cycles, arguing that only a gold standard could protect us from the predation of the state. This is why statists view gold as a "barbarous relic." He also described the events leading to the Great Depression in much the same way that Murray Rothbard did in America's Great Depression.

Murray Rothbard warned when Greenspan became Fed Chairman that we should not expect Greenspan to be any better than his predecessors, pointing to Greenspan's previous record, including his support for President Ford's imbecilic "Whip Inflation Now" buttons and his saving Social Security by raising payroll taxes. As it turned out, Rothbard was entirely right.

more...

[UpInArms]

25. Have I said how much I despise the Washed-Up Has-Been Partisan Hack lately

I'm just waiting to see where they plant his decaying carcass :evilgrin:

more from your link:

That however is a preposterous claim. As Mark Skousen showed in his book The Economics of a Pure Gold Standard, the global supply of gold has historically tended to grow 1-2% per year. Since gold supply would be the basis of money supply under a pure gold standard (or at least the monetary base under the weaker version with fractional reserve banking), then it follows that under a "mimic gold standard" the money supply would grow at the same low rate. Yet between August 1987, when Greenspan became Fed Chairman, and November 2005, the monetary base rose from $233.5 billion to $782.5 billion, a 235% total increase or 6.8% at an annual rate. The M3 measure of money supply rose during the same period from $3.62 trillion to over $10 trillion, a 179% increase or 5.8% at an annual rate. Money supply growth has thus been far in excess of gold standard conditions.

In fact these numbers underestimate just how different things are from the conditions of a gold standard, because the Fed does not just manipulate the economy through increasing the money supply. It also manipulates the economy through the expectations of changes in the money supply.

Alan Greenspan has a record of repeated rescue operations during times of financial distress. From the stock market crash of 1987 to the S&L crisis of the early 1990s to the Asian crisis and the collapse of LTCM to the feared Y2K crisis to the bursting of the tech stock bubble, Greenspan has proven himself more than willing to bail out failed investors with additional doses of "liquidity" (the popular inflationist euphemism for inflation).

[54anickel]

38. Oh yeah, you've mentioned that once or twice, and about that inflation

(or should I say "liquidity").

snip>

The consequences of this have been great. Instead of falling as a result of increased production, the consumer price index rose nearly 74% between August 1987 and November 2005, an average annual increase of 3.1%. This, together with the even greater asset price increases means that the purchasing power of the dollar has been sharply reduced, something which in turn has constituted large scale "confiscations of wealth," as the 1966 Alan Greenspan described inflation.

[UpInArms]

39. Do you think the term "consciously dishonest" is equal to LIAR?

Not that he would admit it. Because apart from inflation and economic imbalances, the defining characteristic of the Greenspan Fed has been its dishonesty. We have already seen how Greenspan claimed to have mimicked gold standard conditions. Moreover, instead of admitting how he was responsible for the tech stock bubble through the creation of moral hazard and suppression of interest rates, he blamed the bubble on "irrational exuberance." And instead of admitting his role in creating the housing bubble, he denied that there was such a bubble. Later, when he admitted that the housing bubble was real, he spoke out against it as if he had nothing to do with having created it in the first place.

Given Greenspan's obvious familiarity with Austrian economics, we can only conclude that he is consciously dishonest. In his tenure as Fed Chairman, Greenspan has acted precisely like the central bankers he attacked in 1966. The enduring legacy of the Greenspan era will be the large-scale confiscations of wealth and economic imbalances — all of it blamed on others.

[UpInArms]

24. Feb Gold @ $517.10 oz

9:53am 12/30/05 FEB GOLD FALLS 40C TO $517.10/OZ IN MORNING TRADING

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38716.4149945023-855895276&siteID=mktw&scid=0&doctype=806&

SAN FRANCISCO (MarketWatch) -- February gold fell 20 cents to $517.30 an ounce on the New York Mercantile Exchange, but prices were poised to end the year with a gain of over 10%. Metals trading on the exchange will close by 12:10 p.m. Eastern time ahead of the New Year's holiday. Analysts remained upbeat about gold's prospects. "Strong physical and investment demand, increasing geopolitical concerns here and abroad and the likelihood of a resumption of the bear market in the U.S. dollar, are all factors that should drive gold towards its all-time highs," said Peter Grandich, editor of the Grandich Letter.

[UpInArms]

57. Feb Gold closes @ $518.90 oz up 14.5% for year

12:25pm 12/30/05 JAN PLATINUM CLOSES AT $973/OZ, UP $8.80 ON DAY

12:25pm 12/30/05 JAN PLATINUM CLOSES OUT THE YEAR ABOUT 13% HIGHER

12:25pm 12/30/05 MARCH SILVER ENDS AT $8.89/OZ, UP 0.1% FOR THE DAY

12:25pm 12/30/05 MARCH SILVER FINISHES THE YEAR UP 26.9%

12:25pm 12/30/05 FEB GOLD CLOSES AT $518.90/OZ, UP $1.40 FOR THE DAY

12:25pm 12/30/05 FEB GOLD ENDS THE YEAR $65.80, OR 14.5%, HIGHER

[UpInArms]

26. Job Cuts in Pharma Industry Up 150 Percent

http://www.heartland.org/Article.cfm?artId=18262

In November, pharmaceutical manufacturer Merck & Co. announced it would cut 7,000 jobs by 2008 and would close or sell five of its 31 manufacturing facilities. The cuts reflect a larger trend of increasing layoffs throughout the industry in the United States.

The Merck move was described in a corporate announcement as a "global restructuring program" potentially yielding pre-tax savings of $3.5 to $4 billion between 2006 and 2010. The announcement made no mention of the ongoing litigation and resulting expenditures the company faces over its drug Vioxx, which Merck voluntarily removed from the market in September.

Industry in Trouble

The announced cuts bring the industry total of job losses in the first 11 months of 2005 to at least 24,396. The figure is 150 percent more than the 9,744 pharmaceutical job cuts announced for the same period in 2004, according to Challenger, Gray & Christmas, a global outplacement firm that tracks industry layoffs.

"Merck's troubles go beyond the Vioxx debacle," said John A. Challenger, chief executive officer of Challenger, Gray & Christmas. Vioxx, a popular anti-inflammatory drug in the Cox-2 class of nonsteroidal, anti-inflammatory drugs (NSAIDS), was pulled when results of a three-year clinical trial indicated the medication, when taken long-term, might contribute to the risk of heart attack.

But Challenger sees the Merck cutbacks as a reflection of the current drug market. "Throughout the industry, we are seeing an all-out search for the next big prescription drug that will become a profit blockbuster," he said. Several companies are cutting back on sales and marketing staff and focusing their attention on research and development (R&D).

...more...

[UpInArms]

36. Sovereign Faces Accusation Over (paid-for propaganda) Editorial

http://www.chron.com/disp/story.mpl/ap/business/3554927.html

PHILADELPHIA — Sovereign Bancorp Inc.'s largest shareholder on Thursday accused the company of not fully disclosing its business ties with the author of an essay published in a trade publication that supported a controversial multibillion-dollar acquisition deal.

Relational Investors LLC, of San Diego, said it asked the Securities and Exchange Commission to investigate the Philadelphia thrift's conduct.

"We believe Sovereign designed these communications to mislead small shareholders, which makes its conduct particularly troubling and objectionable," Ralph Whitworth, a principal at Relational, said in a statement.

Sovereign officials accused Relational of reacting "with near-hysteria" to the article and said "Mr. Whitworth obviously has a difficult time with people who disagree with him." The company also said it has contacted the SEC about "the endless stream of false and misleading statements, innuendoes and half-truths regularly disseminated by Relational."

Ben Plotkin, chairman and chief executive of Ryan Beck & Co., wrote an opinion article in the American Banker on Dec. 9 that supported Sovereign's sale of a 19.8 percent stake to Spain's Grupo Santander for $2.4 billion. Relational said Plotkin should have fully disclosed Ryan Beck's financial ties with Sovereign.

...more...

[UpInArms]

37. Dana files restated results back to 2000 - Takes $44 Million Hit on Income

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-12-30T154933Z_01_WEN7002_RTRIDST_0_AUTOS-DANA-RESTATEMENTS-URGENT.XML

CHICAGO, Dec 30 (Reuters) - Auto and truck parts maker Dana Corp on Friday filed restated financial results for the first two quarters of 2005 and various results back to 2000 with federal regulators, reducing net income by some $44 million.

Dana, which said it has finished an internal investigation, said it inappropriately recognized customer pricing increases and supplier reimbursement costs in its truck parts business and failed to account properly for steel surcharges.

Dana last week said it expected to complete its restatement of financial results and file them with the U.S. Securities and Exchange Commission by the end of the year. Auditors identified several material weaknesses in its internal controls.

[UpInArms]

41. 11:19 EST - and the word is "sell"

Dow 10,724.31 -60.51 (-0.56%)
Nasdaq 2,203.01 -15.15 (-0.68%)
S&P 500 1,247.51 -6.91 (-0.55%)
10-Yr Bond 4.374 -0.02 (-0.05%)

NYSE Volume 427,500,000
Nasdaq Volume 405,507,000

11:00 am : Holding relatively still over the past half hour, the market remains at its worst levels of the morning. The yield curve remains slightly inverted, with the 2-year note yielding 4.37% and the benchmark 10-year offering 3.6%; that action within the bond market continues to occupy the stock market's spotlight, but note that volume behind the action is very thin and thus suggests strong conviction lacks. While an inverted yield curve has presaged the past four recessions, it does not guarantee that a recession is on the way. DJ30 -48.11 NASDAQ -15.81 SP500 -6.72 NASDAQ Dec/Adv/Vol 1970/776/342.4 mln NYSE Dec/Adv/Vol 2139/863/255.2 mln

10:30 am : The indices fade further amid a lack of leadership. At this point, auto manufacturing is the S&P's sole industry to have risen in excess of 1.0%. General Motors (GM 19.34 +0.34) drives the group's 1.3% advance -- and may enjoy some buying action today as it tops the 2006 Dogs of the Dow list. The well known investing strategy is a process by which an investor purchases the top ten yielding Dow components, typically at the start of the year. These high yielding stocks have been coined "dogs" because a high yield is the product of a low price relative to the dividend paid -- an indication that the stock may be under-priced and due to rally. Based on the current price, GM sports a 10.3% dividend yield. The car maker's contribution isn't enough to pull the Discretionary sector (-0.3%) to gaining ground, though; all ten sectors still post losses.DJ30 -50.11 NASDAQ -16.05 SP500 -6.50 NASDAQ Dec/Adv/Vol 1893/755/242.7 mln NYSE Dec/Adv/Vol 2110/804/178.8 mln

check out the advancers/decliners:

 		NYSE		Nasdaq	
Advances	843	(26%)	771	(25%)	
Declines	2198	(69%)	2025	(68%)	
Unchanged	139	(4%)	171	(5%)

[Roland99]

43. What? No Faeries today?

[UpInArms]

45. Maybe the faeries will appear if they don't get too drunk

:D

U.S. Stocks Decline, Sending Dow Jones Average Down for Year

http://www.bloomberg.com/apps/news?pid=10000103&sid=aRgCHcyX8a74&refer=us

Dec. 30 (Bloomberg) -- U.S. stocks fell on the final trading day of the year, erasing the Dow Jones Industrial Average's 2005 advance, as speculation increased profit and economic growth will slow next year.

A fourth-quarter rally sputtered this week as bond yields and home resales suggested a weakening economy. The Standard & Poor's 500 Index headed for its first December drop since 2002.

``To buy stocks just because it's the end of the year is not a good reason to do it when the fundamentals indicate otherwise,'' said Peter Boockvar, equity strategist at Miller Tabak & Co. in New York. ``The yield curve is flattening in response to the slowing housing market. The implications can't be ignored. That's why we're trading the way we are.''

<snip>

Trading was slower than average as some investors take vacation between the Christmas and New Year's holidays. Some 322 million shares changed hands on the New York Stock Exchange, 63 percent less than the same time two weeks ago. Almost five stocks fell for every one that rose on the Big Board. U.S. stock markets will be closed on Jan. 2 for the New Year's holiday.

...more...

[BurgherHoldtheLies]

49. 2005 STOCK MARKET WATCH Appreciation Post

To all of you who keep the STOCK MARKET WATCH daily thread:

Thank you for keeping us all informed in 2005. Your work and dedication is appreciated more than you know.:hug:

Sincerely,

BurgherHoldTheLies

[Roland99]

50. Agreed!.....Huzzah! Huzzah! Huzzah!

[w8liftinglady]

63. Thank you all for your hard work and research...

[Zorra]

65. Yeah, thanks lots!

Have a great New Year that includes Democrats taking over the House and Senate!
:toast:
Z

[cosmicdot]

69. yep ...

here's to a new year of more shocked economists

[UpInArms]

51. 12:09 EST red numbers and inane blather

Dow 10,724.79 -60.03 (-0.56%)
Nasdaq 2,204.38 -13.78 (-0.62%)
S&P 500 1,247.57 -6.85 (-0.55%)
10-Yr Bond 4.370 -0.06 (-0.14%)

NYSE Volume 555,306,000
Nasdaq Volume 528,365,000

The market's major averages have stuck within a tight trading range throughout the morning, and are not budging from session lows as they head into 2005's final trading hours. Holiday-thinned volume has characterized the week's action, and that's especially the case today as many participants jump-start the three-day New Year's weekend. The lack of catalysts due to a near silent corporate front, a blank economic calendar, and an empty economic docket help to further thwart buying efforts. Sellers dominate, and year-end portfolio adjustments may be the root of their labor.

Leadership altogether lacks: All ten economic sectors have failed to clear the flat line today. 0.8% losses levied by Telecom and Materials blaze the southbound trail, but 0.6% declines in the influential Financial and Technology sectors weigh heaviest. The Treasury market's inverted yield curve continues to be the focal point of the stock market, and, though it's come as little surprise and on light volume, it nonetheless serves as a bearish backdrop. To that end, the rate-sensitive Financial sector faces especial weakness in bank stocks. The bond market, which closes early at 1:00 ET, has shifted lower in parallel fashion today. Separately, Citigroup (C 48.39 -0.19) exerts pressure after reports indicated that the banking giant has increased its bid (to $3 billion) for the state-owned Chinese lender Guangdong Bank. Similarly dragged by wide-spread selling, Tech's position contributes to the Nasdaq's underperformance today. Semiconductors, one of the sector's best-faring industries in 2005, serve as a pocket of relative weakness as traders perhaps attempt to lock-in profits. Intel (INTC 25.01 -0.06) had provided some slight offsetting support due to its reported marketing makeover - which reflects our Overweight rating on the Technology sector because of strong end-market demand for portable and digital consumer electronics - but has also fallen victim to selling.

Again pressured by locking of its 29% year-to-date gain, Energy vacillates just under the unchanged mark. Rocky crude futures trade, which leaves the commodity bouncing around the $60 per barrel mark, has gone largely unnoticed by the sector and broader market alike. News that ConnocoPhillips (COP 57.80 +0.10), Marathon Oil (MRO 60.60 -0.10), and Amerada Hess (AHC 126.12 +0.43) have re-entered Libya after 19 years also has had little effect on trade. Back to the crude action, The Discretionary (-0.3%) sector appears unfazed and actually demonstrates some degree of relative strength. General Motors (GM) has driven the auto manufacturing industry to the top of the S&P -- possibly due to the fact that the stock tops the 2006 Dogs of the Dow list. The well-known investment strategy calls for the purchase of the average's ten highest-yielding stocks, because a high yield is the product of a low price relative to the dividend paid -- an indication that the stock may be under-priced and due to rally. GM currently sports a 10.3% dividend yield. DJ30 -58.18 NASDAQ -13.40 SP500 -6.40 NASDAQ Dec/Adv/Vol 1981/889/514.2 mln NYSE Dec/Adv/Vol 2106/998/386.9 mln

[ozymandius]

53. bye folks - gotta scoot

12:27
Dow 10,729.27 -55.55 (-0.52%)
Nasdaq 2,204.92 -13.24 (-0.60%)
S&P 500 1,247.97 -6.45 (-0.51%)
10-Yr Bond 43.79 +0.03 (+0.07%)
NYSE Volume 593,155,000
Nasdaq Volume 564,030,000

Have a safe and happy New Year's Eve.

Ozy :hi:

[54anickel]

55. Bye Ozy, you have a wonderful New Year's weekend as well!

I've got to head out soon myself. Been a busy week here with the hubby home. He's "crampin' my style" these days. But sure is nice to have some time together.

:hi:

[UpInArms]

56. Happy New Year Ozy!

:hi:

:grouphug:

[UpInArms]

60. 1:27 EST bleeding faster

Dow 10,711.50 -73.32 (-0.68%)
Nasdaq 2,202.43 -15.73 (-0.71%)
S&P 500 1,246.70 -7.72 (-0.62%)
10-Yr Bond 4.395 +0.19 (+0.43%)

NYSE Volume 727,151,000
Nasdaq Volume 687,048,000

1:00 pm : Although the Energy sector (-0.4%) continues to rise - albeit modestly - the rest of the market moves deeper into the red. The Discretionary sector (-0.5%), which had appeared unflustered by crude's rise today, has recently slid lower. As is the case across the market's board, that sector is infected with some wide-spread selling that leaves few discretionary issues standing. General Motors (GM 19.40 +0.39) - which is on its way to being the only Dow component to have lost 50% this year - continues to serve as the sector's strongest link. Seemingly paradoxical, its weakness may be serving as its strength today as the stock tops the 2006 Dogs of the Dow list.DJ30 -64.68 NASDAQ -14.92 SP500 -7.30 NASDAQ Dec/Adv/Vol 1978/967/625.1 mln NYSE Dec/Adv/Vol 2119/1022/475.4 mln

12:30 pm : Little has changed for equities. Energy (+0.2%) has risen to a modest gain, alongside a 1.2% rise in the price of February crude futures contracts, but that sector's rise has done little for the broader market. The oil and gas equipment and services industry -- which is up 47% this year -- fares best. Financials, Technology, and Healthcare, which collectively cover nearly half of the S&P 500, each levy 0.6% losses that effectively stunt the indices' advances and overshadow any strength in Energy.DJ30 -55.23 NASDAQ -13.46 SP500 -6.23 NASDAQ Dec/Adv/Vol 1979/947/568.2 mln NYSE Dec/Adv/Vol 2139/973/439.2 mln

[UpInArms]

66. U.S. foreign portfolio holdings rise 20.1% in 2004 ($$ leaving the country

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38716.6244955903-855916123&siteID=mktw&scid=0&doctype=806&

WASHINGTON (MarketWatch) -- Americans increased their portfolio holdings of foreign securities by 20.1% in 2004 to a total of $3.79 trillion, the Treasury Department said Friday. Holdings of foreign equities increased 23.1% to $2.56 trillion, while holdings of long-term debt increased by 13.6% to $993 billion. Holdings of U.K. securities were more than double the amount of any other country at $738 billion, with Japan at $384 billion, Canada at $345 billion, France at $217 billion and the Netherlands at $217 billion. Germany, the Cayman Islands, Bermuda, Switzerland and Australia rounded out the top 10, accounting for 71% of the total.

[UpInArms]

67. 3:14 EST heading for the finish - whining and bleeding

Dow 10,720.94 -63.88 (-0.59%)
Nasdaq 2,204.80 -13.36 (-0.60%)
S&P 500 1,248.68 -5.74 (-0.46%)
10-Yr Bond 4.395 +0.19 (+0.43%)

NYSE Volume 1,012,246,000
Nasdaq Volume 947,922,000

3:00 pm : More of the same for stocks ... While a bearish undertone has pervaded today's trading session, there are, nonetheless, some bright spots. Within the Tech sector, which has slipped 0.6%, Apple (AAPL 71.87 +0.42), Symbol Technologies (SBL 12.78 +0.18), and Solectron (SLR 3.61 +0.04) demonstrate relative strength. Financials 0.6% decline is somewhat limited by relative strength in Fannie Mae (FNM 48.51 +0.53) and American Express (AXP 51.32 +0.21), while Bausch & Lomb (BOL 68.46 1.26) and Biogen (BIIB 45.32 +0.66) are Healthcare's (-0.7%) brightest spots. Energy's 0.7% advance still serves as the market's best source of support, but the gain is ultimately muted by sellers' dominance. DJ30 -57.47 NASDAQ -11.50 SP500 -5.03 NASDAQ Dec/Adv/Vol 1950/1093/900.1 mln NYSE Dec/Adv/Vol 2013/1212/687.8 mln

2:30 pm : The indices continue to hover within the session's narrow range. An hour ago we discussed the S&P's Top Ten list for 2005; here's a look at the year's Bottom Ten industry groups. Auto manufacturers have lost a whopping 49.0%, followed by a 43.2% drop in IT consulting and services. Down 27.4%, photo products occupy the third place laggard seat. Internet retail declined 25.0%, followed by auto parts and equipment (-23.9%) and home furnishing (-19.5%). The broadcast and cable industry fell 17.1%, trailed by a 17.0% loss in computer storage and peripherals. At number ten, brewers were the best of the worst - posting a 15.3% decline.DJ30 -54.75 NASDAQ -11.30 SP500 -5.30 NASDAQ Dec/Adv/Vol 1894/1102/823.0 mln NYSE Dec/Adv/Vol 1980/1231/623.2 mln

[UpInArms]

68. ending the year deeply in the red (numbers, blather and HNY)

Dow 10,717.50 -67.32 (-0.62%)
Nasdaq 2,205.32 -12.84 (-0.58%)
S&P 500 1,248.29 -6.13 (-0.49%)
10-Yr Bond 4.395 +0.19 (+0.43%)

NYSE Volume 1,443,394,000
Nasdaq Volume 1,284,073,000

2005's final trading day was dominated by selling action that locked the major averages within a very tight, red range. Wedged between two holiday weekends, thin volume characterized the past five sessions and particularly today's as many participants got an early start to the New Year' weekend. The lack of catalysts due to a taciturn corporate front and a blank economic calendar helped to further hinder buying efforts. While the market's disposition was decidedly bearish, losses were somewhat kept in check and likely driven by year-end portfolio adjustments. In the end, though, today's action did little to change the indices' 2005 statuses: Each ended on positive ground, and the S&P clung to the 3.5% with which it entered the session. Although that's not the best of returns, it's the third consecutive year during which the market has risen.

A lack of leadership left the market stunted. Somewhat bucking the bearish bias was Energy. A 1.2% rise in the price of crude helped incite some buying interest, and last-minute portfolio additions of the market's best-performing sector likely provided added support. Ultimately, though, its 0.3% gain could not effectively counter the losses levied by the nine other sectors. Dragged by profit-taking within the diversified metals and mining industry, Materials (-0.8%) led the laggards. It was a trio of declines posted by the market's three heaviest sectors -- Financial (-0.4%), Technology (-0.6%), and Healthcare (-0.7%) -- however, that can be largely credited with today's slide. The Treasury market continues to loom as equity traders' focal point, and, although this week's yield curve inversion came as little surprise and on conviction-lacking volume, another session of the two-year note's yield surpassing the 4.39% offered by the 10-year especially weighed upon the Financial sector. To that end, banks posed a particular challenge. On a related note, Citigroup (C 48.68 +0.10) wasn't helped by news that it's upped its bid for state-owned Chinese lender Guangdong Bank to $3 billion. Regading the Tech sector, Intel (INTC 24.94 -0.13) had lent some modest support in the early going, following reports of its marketing makeover, but too fell victim to pervasive selling.

While the crude action had initially appeared overlooked, the Discretionary sector (-0.6%) eventually responded to the commodity's rise over $61 per barrel. The story there was a similar one of wide-spread selling. General Motors (GM 19.35 +0.34 ) stood as its brightest spot; seemingly paradoxical, its year-long weakness doubled as its strength today. The Dow component is the first since 2002 to have lost 50% or more over the course of a year. At the same time, with a 10.3% dividend yield, GM tops the 2006 Dogs of the Dow list and may have, for that reason, attracted some buyers today.

DJ30 -67.32 NASDAQ -12.84 SP500 -6.13 NASDAQ Dec/Adv/Vol 1751/1325/1.30 bln NYSE Dec/Adv/Vol 1955/1302/1.10 bln

Happy New Year to all of you out there!

See you on Tuesday :hi:

[dweller]

70. heckuva job there, georgie!

http://www.washingtonpost.com/wp-dyn/content/article/2005/12/30/AR2005123001151_pf.html

Closing Bell Rings on Lackluster Year

By Jerry Knight
Washington Post Staff Writer
Friday, December 30, 2005; 6:03 PM

The closing bell clunked today as the stock market ended one of its most lackadaisical and lackluster years ever.

The Nasdaq Stock Market composite index gained just 1.4 percent over the past 12 months -- the smallest annual move since that index was invented.

The Dow Jones industrial average was down 0.6 percent for the year, setting another record for going nowhere.

The Standard & Poor's 500 stock index recorded a 3 percent gain, which means the average stock did better than either the blue-chip Dow or the tech-heavy Nasdaq. Still 3 percent--4.5 counting dividends paid by the S&P stocks--was a paltry payoff considering investors could earn more than 4 percent on certificates of deposit or government bonds.

In today's trading the Dow fell 67 points to 10,717.50, the S&P slipped 6 points to 1,248.29 and the Nasdaq composite dropped 13 points to 2,205.32.

Thumbing their noses at Wall Street strategists who encouraged their clients to buy stocks by predicting a "Santa Claus" rally, the traders who rule the market used the last week of the year to cash in what few profits they were able to make. In the process they drove down the market some more, leaving anyone still holding stocks with little to show for the year.

What went wrong? The weather was the worst thing. By slashing oil production in the Gulf of Mexico and trashing the economies of coastal states, hurricanes delivered a painful blow to the economy. As oil prices hit records, consumers began pulling in their horns and honking in derision at gas-guzzling sport utility vehicles. Detroit had a disastrous year: forced to bribe drivers to buy domestic vehicles, it still saw sales erode.

The Iraq war drained billions out of government coffers producing record budget deficits at the same time soaring oil imports gave the U.S. its worst trade deficit ever.

And the Federal Reserve's relentless increase in interest rates--which almost everyone agreed was necessary -- finally began to pinch.

Interest rates ultimately killed any hope of a year-end rally when a train wreck that Wall Street had seen coming for months finally occurred.

As the Fed boosted short-term rates over the past year, longer term interest rates, which are set by the bond market, refused to follow along. So many investors around the world are eager to buy U.S. bonds that the government could borrow all the money it needs without raising rates.

Usually rates on 10 year bonds are about 1 percentage point higher than rates on 2-year bonds. But the gap narrowed to a tiny fraction of a point and finally disappeared this week. On and off during the week, 2-year bonds were actually paying higher rates than 10 year ones.

Economists call that phenonomon an "inverted yield curve." They note that the last four times it has happened, the U.S. has gone into a recession. Wall Street insists this time will be different and maybe it will. But the threat of a recession ahead prompted many investors to cash in their stock profit gains this week, ending the year on Wall Street with a clunk.


dp