STOCK MARKET WATCH, Thursday 9 June

[ozymandius]

Thursday June 9, 2005

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 3 YEARS, 226 DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 4 YEARS, 172 DAYS
WHERE'S OSAMA BIN-LADEN? 3 YEARS, 235 DAYS
DAYS SINCE ENRON COLLAPSE = 1292
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 2
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

AT THE CLOSING BELL ON June 8, 2005

Dow... 10,476.86 -6.21 (-0.06%)
Nasdaq... 2,060.18 -6.98 (-0.34%)
S&P 500... 1,194.67 -2.59 (-0.22%)
10-Yr Bond... 3.94% +0.03 (+0.74%)
Gold future... 426.60 -0.10 (-0.02%)

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. WrapUp by Jim Willie CB and Mike Hartman

HOPE AFTER FALSE SIGNALS FOR GOLD

In the last 18 to 24 months, two key “False GO Signals” lifted the gold price from its low in 2003 of $320 per ounce to its recent high of $455 in December 2004. The markets finally figured it out though, and the gold price has languished. In the recent history, certain signals were highly reliable for a powerful rise in the gold price. However, in the age of Chinese renaissance the signals might not be so reliable anymore. Few in the gold community seem to have identified either signal as anything but a major bullish indication for much higher gold prices and strong continuation of its bull market, even after several failed gold rallies. This here analyst does not share such a view, and my analysis has elaborated in much detail as to why much of the banking system’s inflationary machinery has been operating in a reverse gear, in quiet subtle support of the secular deflation underway. Even Greenspan acknowledged this week how the bond conundrum might be answered by globalization and the unleash of cheap Asian labor. Most new money goes to dreaded new debt, unproductive dead end destinations to be sure. The fundamental force behind the false GO signals is Chinese industrialization, and their interference with the US Federal Reserve reflation initiative.

The two signals, which to date have not succeeded in generating systemic price inflation inside the US Economy are:

1. fast rising USDollar money supply growth
2. negative short-term real interest rates

-cut-

BAD MONEY SUPPLY GROWTH

The wider M3 money supply has grown from $7.3 trillion at the start of 2001 to $9.6 trillion through March 2005. “That is a lot of chicken!!!” Just where did it go? Did the USA use it constructively? NO. Did we build something advantageous with it? NO. Did we waste it? YES. Did we gamble it away? YES. Did we blow it like a drunken sailor on shore leave? YES. Did we buy trinkets, gadgets, and junk with it? YES. Did we try to keep up with the Joneses in lifestyle and designer clothes? YES. Did we buy into the moronic notion that US consumers should power the world economy in yet another sick New Paradigm? YES. Is it any wonder that all this occurred when Viagra sales shot through the roof? NO. Is it any wonder that all this occurred when piggish Sport Utility Vehicle sales shot through the roof? NO. Is it any wonder that all this occurred when obesity blossomed across our land? NO. Is it any wonder that all this occurred when the illiteracy rate rose across our land? NO.

-cut-

TODAY’S MARKET by Mike Hartman

Shortly after the opening bell this morning, the Dow Industrials moved 45 points higher and held the modest gains through the morning hours with low volatility. Treasury bond prices also demonstrated low volatility as the U.S. Treasury auctioned $14 billion of five-year notes and will sell another $8 billion of ten-year notes tomorrow. I have noted many times that low volatility across all market sectors is very typical behavior whenever the Treasury needs to sell more debt. In similar fashion, the U.S. dollar began the day slightly lower, but has since reversed to move higher versus all major currencies. Throughout the morning, the markets were quiet overall, except for the gyrations down in the energy pits.

-cut-

The weaker GDP forecast along with higher inflation expectations took their toll on stocks and bonds, but the dollar rallied all session long to close at 87.90 on the U.S. dollar index, with the euro at $1.223 and yen at 0.932. If you haven’t diversified any funds out of the dollar yet, I find the Swiss franc attractive under $0.80. The Swissie closed today at $0.7971. Supposedly the dollar is continuing its rally on expectation the Fed will continue to raise interest rates to fight inflation. The report today depicting elevated inflation expectations put a bid in the dollar, as the Fed is expected to continue raising interest rates. To that same point, Fed President Guynn indicated interest rates have not yet risen to neutral. He also said that each measure of inflation is heading higher, indicating more rate hikes to come.

more...

http://www.financialsense.com/Market/wrapup.htm

[ozymandius]

2. Also in the news...

China has shocked the energy markets with an announcement to raise the Chevron bid for Unocal. Just when we thought the deal was final with a domestic acquisition of and by an American firm, China throws a wrench in the works. Could a bidding war for energy properties be unfolding? Methinks YES.

I had missed this bit of news. China has signed energy deals with Iran and Venezuela. So has Japan with their project to "manage" oil fields in western Iran. Life for American oil companies has become more complicated. We are on the brink of competing, and possibly, losing access to nations who we have treated as client states for decades.

[54anickel]

20. Gold's marriage to dollar set to end-Barrick

http://www.reuters.com/newsArticle.jhtml?type=topNews&storyID=8736802

NEW YORK (Reuters) - Gold's lengthy coupling to the dollar will end as supply/demand dynamics change and other currencies may come to the fore, Barrick Gold Corp. (ABX.TO: Quote, Profile, Research) CEO Greg Wilkins said at the Reuters Mining Summit on Wednesday.
"There will be a decoupling in the next 5 to 10 years," said Wilkins at the summit, held at the Reuters office in New York.

Gold is priced in dollars on international bullion markets, and the precious metal has a tight inverse price correlation with the U.S. currency, he said.

snip>

The euro's influence could also wane if there were changes in China's foreign exchange policy and a revaluation of the yuan, he said. A stronger euro versus the dollar makes dollar-priced gold cheaper for non-U.S. investors.

snip>

"If China, Japan and the other Asian countries become a basket of currencies then it could become more important than the euro," said Wilkins of the world's No. 3 gold producer.

snip>

Gold prices may be about to benefit from both volatility in and a lack of confidence in several of the world's major currencies, with gold's price in euros a key indicator, said analysts on Tuesday.

more...


Trade Deficit – Be careful what you wish for

(Bit of marketing for their fund, but raises some interesting points)

http://www.merkfund.com/merk-perspective/insights/2005-06-09.html

This Friday on June 10th, the April trade balance will be released. Expectations are for US$58 billion, up from $55 billion in March. In March, the trade deficit had “unexpectedly” narrowed, mostly due to a slowdown of US economic activity.

As the currency markets anticipate Friday’s report, let us keep a few things in mind. First, $58 billion is a very large number; annualized, the U.S. is anticipated to import $700 billion more worth of goods and services than it exports. For the U.S. dollar to remain stable, the trading partners will have to accumulate U.S. dollars at a rate of close to $2 billion a day. For the dollar to fall, foreign trading partners don’t need to stop buying U.S. dollars, they merely need to buy less, for example by diversifying to other hard currencies.

When a slight narrowing of the trade deficit was released last month, the U.S. dollar received short-term relief (the turmoil with the European constitution also helped the dollar short-term). While many of us are fixated with a trade deficit that few economists believe is sustainable, a lower trade deficit is not automatically good news.

The balance of trade is affected by economic activity domestically and abroad. To correct the global imbalances, increased consumption outside of the U.S. or a higher savings rate inside the U.S. would be helpful. However, Europe remains stagnant, and Asia is expected to slow its rapid growth. Conversely, we do not expect U.S. real incomes to rise sharply, as the global imbalances make this exercise an uphill struggle. Global overproduction (through Asian currency subsidy and U.S. fiscal and monetary policies) leads to high raw material costs; a flood of cheap Asian goods combined with a highly indebted U.S. consumer provide for little pricing power. The result is accelerated outsourcing, not exactly the recipe for real income growth as the U.S. labor force is the one being outsourced.

This leaves an economic slowdown in the U.S. as a path to reduce the trade balance. While this “consumers voting with their feet” scenario may be unavoidable sooner or later, it is certainly not a scenario for anyone to look forward to. It would mean that the economy is slowing down, leaving consumers with a lot of debt, and the housing market in danger territory. Consumers may then opt to cash in any “liquid” assets, most notably their stock holdings to reduce their debt. Asian central banks would have less of a need to purchase U.S. dollars, making the dollar more vulnerable.

snip>

Unless the structural imbalances are addressed in a serious manner, with a policy shift that encourages savings, the pressure on the dollar is unlikely to disappear. In the current environment, policy makers choose between driving the imbalances to further extremes (the Organization for Economic Cooperation and Development, OECD, is warning of a $900 billion trade deficit next year), OR a recession.

more...

[54anickel]

22. Looks like UIA and I aren't the only ones thinking the Buck rally has

been "engineered".

On edit: Oops, reply should be to today's wrap-up


snip>

Next up is resolution of imbalance by means of currency adjustment. If it proceeds in orderly fashion, the Chinese yuan currency will be reset to something besides the tight tether ratio to the USDollar. If reallocation of their $620 billion of foreign reserves by the Peoples Bank of China is any indication, the new pegged regime is likely to be a fixed basket of the euro, the yen, gold, and the USDollar. Look for all of Asia to follow suit in what could develop into a rout of the USDollar even if it begins in orderly fashion. If the process breaks down, with trade tariffs and other assorted protectionist levies and obstacles, followed by retaliation, then expect disruption and perhaps chaos. The trouble is, with such extreme imbalances, the hidden forces are an order of magnitude greater than the seeming calm foretells. Even a constructive start could degrade into rampant disorder over time.

Gold will absolutely love the changes, whether orderly or disruptive. The change will permit higher Asian import prices, greater pricing power, puffed profit margins, and likely even a wave of hiring or at least wage gains. The loser might be US Treasury Bonds, since consumer prices will show up as on the rise, led by import prices. Could we be seeing an engineered USTBond rally as a preface for exactly this development? Methinks YES...

snip>

As the USFed continues its rate hikes, it applies stress to the US Economy even while encouraging bond speculation in the euro carry trade. That chapter is coming to an end soon, if not already. The lion share of the narrower trade gap came from reduced imports, which in April fell 2.5% even as exports gained 1.5% from a much lower base. Could we be seeing an engineered USDollar rally as a preface for a resumed bear market and Chinese currency adjustment? Methinks YES. Could backroom deals have been cut with the stubborn Chinese in order to convince them to budge? Methinks YES. These and many other related topics and difficult issues are discussed in detail in my private newsletter. Get me my ringside seat.

:popcorn:

[UpInArms]

33. I'm going to get a ringside seat next to you

:popcorn:

[Tace]

3. Greenspan May Signal More Interest Rate Increases

June 9 (Bloomberg) -- Chairman Alan Greenspan today may reinforce expectations that the Federal Reserve will keep raising interest rates to head off inflation, overriding concerns about a slowdown or lower job growth, economists and investors said.

``His key message will be that the Fed wants to remain vigilant against a rise in inflation,'' Mickey Levy, chief economist at Bank of America in New York, said in an interview.

The chairman's hardest task may be to explain why 10-year Treasury note yields are falling even as the Fed raises its target interest rate, investors said. Greenspan also may be questioned about what he calls ``froth'' in real estate sales and about the swelling trade deficit. A Merrill Lynch & Co. report this week described markets as being on ``knife's edge'' waiting for the central banker's remarks.

``Greenspan has a tough act to sell,'' said Michael Franzese, head of U.S. Treasury trading at Zions First National Bank in Jersey City, New Jersey, in an interview. ``The market is saying there is a recession on the horizon, and he is saying we have strong growth ahead.''

(more)

http://quote.bloomberg.com/apps/news?pid=10000006&sid=anx0M7d9Vehs&refer=home

[UpInArms]

4. daily dollar watch

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

Last trade 87.91 Change +0.03 (+0.03%)

Dollar Launches Surprise Move Against Majors

http://www.dailyfx.com/index.php?option=com_content&task=view&id=1483&Itemid=39

EUR/USD – Euro bulls fell back after the dollar longs sprung a trap on the unsuspecting euro traders with the pair spiraling down over a 100 pips. As the price action continues to heat up, euro bulls found themselves almost where they have started the retrace against the dollar. As the struggle continues euro traders will most likely try to push the pair toward the 1.2500 figure in the latest attempt to regain some of the territory previously lost to the greenback bulls. A move to the upside will most likely be capped by the major resistance at 1.2500, which is marked by the 2004 summer range high. Indicators signal a maturing trend with ADX (DMI) on the daily chart is at 45.8. Stochastic is treading above oversold on the daily chart at 18.02, which is indicative of a strong trend. The Stochastic on the dealer (4HR) chart is neutral at 42.15. RSI is treading above oversold on the daily chart at 31.51 with the 4-hour chart RSI neutral at 40.99. MACD remains deep below the zero line on the daily chart and is sloping downward below the zero line on the dealer 4(HR) chart. In case the reversal fails greenback longs will most likely resume their advance and push the pair toward the psychologically important 1.2000 figure.

<snip>

USD/JPY – Japanese Yen traders where stunned after the dollar bulls managed to push the pair above the 107.00 figure, but lost momentum with the dollar advance stalling around the 107.50 level. As the pair continues to seesaw around the 107.00 handle, a successful move by the yen bulls will most likely see the pair make another attempt to reach the 106.00 figure. A break below the 106.00 might see the yen longs test the bids around the 104.00 figure, thus establishing a triple bottom formation. Indicators signal trend reversal, with ADX (DMI) dropping to 22.35. Stochastic is sloping downward on the daily chart at 26.00, supporting a view that a trend might be weakening. The Stochastic on the 4-hour chart is treading below the overbought line at 66.21, thus providing dollar bulls with a chance to mount a counterattack. RSI is neutral at 49.34 on the daily chart, with dealer (4HR) chart RSI sloping upward above the oversold line at 49.34. MACD is making a bearish crossover above the zero line on the daily chart, with MACD on the 4-hour chart making a bullish crossover below the zero line. If the yen bulls retreat, a move to the upside will most likely see the USD/JPY rocket through 109.00 and target the 110.00 figure, with a breakout targeting the 115.00.

...more...

Dollar Rallies Ahead of Greenspan’s Speech on Economy

http://www.dailyfx.com/index.php?option=com_content&task=view&id=1462&Itemid=39

US Dollar

Although we had some interesting price action today, we didn’t have much information to explain the move. The dollar embarked on a 100 pip rally beginning around lunchtime. Traders are saying that the market is thin and everyone is sitting around waiting for Greenspan’s speech tomorrow on the economy at 10am EDT. It is left to Greenspan tomorrow to tell us if we are really near the end of the tightening cycle or if we have more room to go. Thanks to Dallas Fed President Fisher, the newest member of the monetary policy committee, Greenspan will now have to tackle the eighth-inning talk. Earlier this week, Greenspan skirted the issue of monetary policy and the overall health of the economy, this time around, he will need to address the issue directly. Although headline consumer price inflation was strong during the month of April, core prices have been weak, highlighting the changes in inflationary pressures. Greenspan may also have to address labor market growth either in the statement itself or during questioning after last week’s pathetic number. We are sure that we will also be hearing more about the Interest Rate Mystery and the conundrum surrounding long-term rates tomorrow. Meanwhile US inventories jumped a whopping 0.8% while sales rose 1.5%. From the looks of it, factories do not need to trim their inventories at this point and it seems that demand has been holding up, which provides a glimmer of hope for the business sector.

Euro

Like a falling knife, the euro dropped a hundred pips on little news. Following up on the ECB rate cut talk, council member Weber supported Trichet’s recent comments and said that “it is very much the question of whether spending would improve with a rate cut. Today's business people want to earn their investment back in three to five years. This means that they will only invest if they are sure that there's demand. Whether rates are a quarter or half a percentage point lower, that does not matter much." He also highlighted the continued presence of inflation risk, making it difficult for the central bank to lower rates. This should be euro positive, but the market for the time being, the market remains transfixed on tomorrow’s speeches by Fed Chairman Alan Greenspan.

...more...

That 'toon hit the whole discussion right where it needs to be swatted, Ozy. Thanks!

I won't be around much on this MaeveDay - but will check in when I can.

Have a Great Day Marketeers!

[UpInArms]

14. Japan foreign bond buying set to slow, helping yen

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-06-09T070435Z_01_T362060_RTRIDST_0_ECONOMY-JAPAN-CAPFLOWS.XML

TOKYO, June 9 (Reuters) - Japanese investors are likely to take a breather after a big spree of buying higher-yielding foreign bonds in the last two months, helping support the yen against the dollar in coming months, analysts say.

Japanese investors bought a net 2.6 trillion yen ($24.25 billion) of foreign debt in May, bringing their total purchases for the first two months of the fiscal year to a whopping 6.3 trillion yen, Finance Ministry data showed on Thursday.

While that's more than twice the amount they bought in the same period last year, a closer look at the data shows that the bulk of the purchases were by Japanese banks, whose investments are usually funded in dollars and do not affect the yen.

<snip>

"It's becoming pretty difficult for Japanese investors to get a decent return from investing in U.S. bonds," said Hideo Kumano, chief economist at Dai-ichi Life Research Institute. "Japanese investment in foreign bonds will probably drop off in the remainder of this year."

...more...

[UpInArms]

5. It's MaeveDay! Today's Report:

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

Jun 9	8:30 AM		Initial Claims	06/04	-	335K	335K	350K	-

[Maeve]

7. Jinx! Simul-posting!

:hi:

[UpInArms]

10. G'morning, Maeve!

:hi:

a triple dose of caffeine this morning?

[UpInArms]

11. U.S. weekly jobless claims fall 21,000 to 330,000

http://www.marketwatch.com/news/newsfinder/pulseone.asp?guid={F7206D29-2004-4809-89BF-0C9F45C329B1}&siteid=mktw

WASHINGTON (MarketWatch) -- First-time filings for state unemployment benefits dropped 21,000 in the week ending June 4 to 330,000, the Labor Department said Thursday. The number was in line with economists' expectations and is the lowest since May 21. The four-week average of jobless claims fell 2,750 to 331,750, while continuing claims for the week ending May 28 fell 4,000 to 2.59 million.

8:30am 06/09/05 U.S. CONTINUING JOBLESS CLAIMS FALL 4,000 TO 2.59 MLN

8:30am 06/09/05 U.S. 4-WEEK AVG. JOBLESS CLAIMS DOWN 2,750 TO 331,750

8:30am 06/09/05 U.S. WEEKLY JOBLESS CLAIMS FALL 21,000 TO 330,000

[Maeve]

13. that means last week's was revised up 1,000

Not a big deal...but "lowest since May 21"--wow, and this is June 9.
:rofl:

[UpInArms]

15. can I join you for that

:rofl: ?

:rofl: :rofl: :rofl:

Gotta keep that "it's getting better and better" spin going!

:rofl:

[Maeve]

6. Only report due is Initial Claims

Last week's was 350K, forcast is for 335K. the bigger concern is Greenspin's remarks to Congress.

Finally got a financial planner; been knee-deep in sorting our financial concerns this past week! The amount of papers you can accumulate over the years...

[UpInArms]

8. Hank Greenberg resigns from AIG board

http://www.reuters.com/newsArticle.jhtml?type=businessNews&storyID=8743246&src=rss/businessNews

NEW YORK (Reuters) - Maurice "Hank" Greenberg resigned on Wednesday from the board of American International Group Inc. (AIG.N: Quote, Profile, Research) , marking a final separation from the company he built into a leading global insurer, but then led into a storm of accounting scandals.

According to a copy of his letter to the board, Greenberg's resignation was effective immediately.

Although he hadn't planned to stand for re-election anyway, he decided to step down straight away because of an "inability to receive information regarding the company and its operations necessary to fulfill my fiduciary duties," the letter said.

Chris Winans, an AIG spokesman, confirmed on Wednesday night that AIG had received the resignation letter, but said the company had no further comment.

Greenberg, 80, headed AIG, which has about 90,000 employees and operations in 130 countries, for nearly 38 years. He has already resigned from his positions as chief executive and chairman. Now he faces allegations of fraud in a civil suit, in which AIG and its former CFO Howard Smith are also named.

<snip>

On May 31, AIG said it had overstated net income for the past five years by $3.9 billion, or 10 percent.

...more...

[UpInArms]

9. H-P Plans More Job Cuts

http://www.theledger.com/apps/pbcs.dll/article?AID=/20050609/NEWS/506090441/1001/BUSINESS

Hewlett-Packard Co. spent about $236 million on employee severance payments and other "work force rebalancing" programs between November and April. HP took restructuring charges of $177 million in its fiscal first quarter and $59 million in its fiscal second quarter, according to a filing Wednesday with the Securities and Exchange Commission. The Palo Alto, Calif.-based computer maker said the charges would allow it to slash its worldwide work force by approximately 3,000 employees, including 1,600 people who were laid off before April 30. The rest are expected to be terminated by October.

...very short newsblurb...

[UpInArms]

12. Fed adds reserves through 14-day repos

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-06-09T122913Z_01_N09303096_RTRIDST_0_MARKETS-FED-OPERATIONS.XML

NEW YORK, June 9 (Reuters) - The Federal Reserve said on Thursday it added temporary reserves to the banking system through 14-day repurchase agreements.

Fed funds last traded at 3.00 percent, matching the Fed's current target for the rate on overnight loans between banks.

...more...

[54anickel]

23. 5 freaking billion, and a 7.5 billion 1-day repo to top it off!

http://www.ny.frb.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE

[UpInArms]

16. Treasurys slightly lower after jobs claims

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38512.3647482407-836495352&siteID=mktw&scid=0&doctype=806&

NEW YORK (MarketWatch) - Treasury prices fell slightly early Thursday, pushing up yields, after news that jobless claims in the latest week fell 21,000 to 333,000. The result was in line with economists' expectations and marked the lowest level since May 21. Dealers said the weaker prices were linked to investor nervousness ahead of a congressional appearance by Federal Reserve Chairman Alan Greenspan. Investors are hoping the chairman will provide clues about the rates outlook, after comments by Dallas Fed President Richard Fisher last week stoked hopes for a softer monetary policy. In recent trades, the yield on the benchmark 10-year note rose to 3.976% from 3.952 before the jobless claims report.

[UpInArms]

17. Blather Fed Head: Fed's Moskow says fair access to credit important

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-06-09T130042Z_01_N09684220_RTRIDST_0_ECONOMY-FED-MOSKOW.XML

CHICAGO, June 9 (Reuters) - Chicago Federal Reserve Chairman Michael Moskow on Thursday said the United States can encourage economic growth by ensuring fair access to credit for small businesses owned by women and minorities.

"Businesses owned by women and minorities comprise the fastest growing segment of small businesses," Moskow said in remarks prepared for a corporate leadership conference.

However, many of those businesses remain relatively small, undercapitalized and underrepresented in the more capital-intensive sectors of the economy, he said.

<snip>

Moskow did not address the current economy or monetary policy in his prepared remarks.

...more at link...

[UpInArms]

18. pre-opening blather

briefing.com

9:00AM: S&P futures vs fair value: -0.6. Nasdaq futures vs fair value: +0.5. Still shaping up to be a rather subdued start for stocks, as futures indications trade close to fair value... Meanwhile, chip stocks should be in focus again ahead of Intel's (INTC) mid-quarter update tonight and following two analyst downgrades on Xilinx (XLNX) after XLNX cut its Q1 gross margin forecast... Internet should also garner attention after Smith Barney initiated coverage on GOOG and YHOO with Buy ratings and starting AMZN and EBAY with Hold ratings

8:32AM: S&P futures vs fair value: +0.8. Nasdaq futures vs fair value: +3.0. Futures trade holds relatively steady following economic data, still indicating a flat to slightly higher open for the indices... Weekly jobless claims fell 21K to 330K, slightly below forecasts of 335K... Bonds have also held steady, as the 10-yr note (-9/32) yields 3.96%

8:00AM: S&P futures vs fair value: +0.2. Nasdaq futures vs fair value: +1.5. Futures market versus fair value suggesting a lackluster open for the cash market as investors wait for Greenspan's forthcoming remarks about inflation trends and the appropriate course of monetary policy, as well as a key economic report, to set a more a definitive tone to trading... At 8:30 ET, initial claims (consensus 335K) will be released while at 10:00 ET, Fed Chairman Alan Greenspan will address the Joint Economic Committee of Congress

ino.com

The June NASDAQ 100 was lower overnight as it extends the decline off last week's high and is challenging support marked by the 20-day moving average crossing at 1527.77. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near-term. Closes below the 20-day moving average crossing at 1527.77 would open the door for a possible test of the 38% retracement level of the April-June rally crossing at 1508.22 later this month. The June NASDAQ 100 was down 2.50 pts. at 1528 as of 5:35 AM ET. Overnight action sets the stage for a steady to lower opening by the NASDAQ composite index later this morning.

The June S&P 500 index was lower overnight as it extends the decline off last week's high. Closes below last Tuesday's low crossing at 1191.70 are needed to confirm that a short-term top has been posted and would open the door for a test of the 20-day moving average crossing at 1189.57. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near-term. If June renews this spring's rally, the 75% retracement level of the March-April decline crossing at 1209.52 is the next upside target. The June S&P 500 Index was down 2.20 pts. at 1193.70 as of 5:38 AM ET. Overnight action sets the stage for a steady to lower opening when the day session begins later this morning.

[54anickel]

19. Death of the Carry Trade

http://www.prudentbear.com/archive_comm_article.asp?category=Guest+Commentary&content_idx=43690

In the financial markets, the term “Carry Trade” refers to the way that most financial intermediaries (money center banks, Wall Street investment banks, and hedge funds) make their really large profits. Indeed, the engine driving financial profits is quite simple: borrow at low short-term interest rates, and lend at higher longer-term interest rates. In the Carry Trade, to enhance returns and make them exciting, leverage is used. For liquid assets like Treasuries and Agency Securities, leverage of over 25 to 1 is possible!

When the Federal Reserve was fighting the collapse of the NASDAQ stock market bubble and cut short-term interest rates to 1 percent, the financial markets were a “Carry Trader’s delight”. The interest rate yield curve was steep, and credit spreads were wide and narrowing. To make money, financial institutions simply needed to close their eyes, buy longer dated paper and lower rated credits, and then sit back and enjoy the Fed’s interest rate subsidy. There was a lot of easy money to be made and even corporations got into making money through finance. Currently, 40 percent of corporate profits in S&P companies are made from financing activities. Indeed, a firm like GM doesn’t make money from manufacturing and selling cars anymore; it makes money by financing cars and houses.

So, wither the Carry Trade? The Federal Reserve has raised interest rates eight times with no end in sight and the yield curve is starting to go flat. Notice that the Fed funds rate is increasing to at least 3.5 percent, while the yield on the 10-year Treasury note has been brought down to under 4.0 percent by foreign central banks and long dollar speculators. Now that the yield curve has “lost its curve,” this profit engine has run out of gas.

The only way to make money in the Carry Trade game is to take on more credit risk and increase leverage, but the problem with that is credit spreads are already at levels that have become so narrow that spread-lending offers little reward, and massive risk. The downgrade of GM and Ford to junk has come at a time when the credit cycle has started to turn from improving credits and narrowing credit spreads, to negative credit surprises and widening spreads. A widening credit spread can push down a bond price faster than rising interest rates.

more...

[UpInArms]

21. Has-Been Partisan Hack babbles uncontrollably

http://www.marketwatch.com/news/newsfinder/pulseone.asp?guid={02974804-BF6B-4AB9-97BC-06FAFA622D32}&siteid=mktw

WASHINGTON (MarketWatch) -- Federal Reserve Chairman Alan Greenspan said Thursday he wasn't concerned that a serious slowdown was emerging from a recent soft patch in U.S. economic data. He repeated that the Fed can continue to raise interest rates at a "measured pace." In prepared testimony to the Joint Economic Committee, Greenspan said, "The most recent data support the view that the soft readings on the economy observed in the early spring were not presaging a more-serious slowdown in the pace of activity." He said consumer spending had rebounded and business investment was more upbeat. Underlying inflation remains contained despite signs of price pressures, he said.

10:01am 06/09/05 GREENSPAN SEES NO MACRO EFFECT FROM HOUSING 'FROTH'

10:00am 06/09/05 GREENSPAN STICKS TO MEASURED RATE HIKE POLICY

10:00am 06/09/05 GREENSPAN: PROFITS SHOW EVIDENCE OF PRICING POWER

10:00am 06/09/05 GREENSPAN: CONSUMER SPENDING FIRM, BUSINESSES UPBEAT

10:00am 06/09/05 GREENSPAN: UNDERLYING INFLATION REMAINS CONTAINED

10:00am 06/09/05 GREENSPAN: U.S. ECONOMY ON 'REASONABLY FIRM FOOTING'

10:00am 06/09/05 GREENSPAN REPEATS RATES CAN BE RAISED AT MEASURED PACE

10:00am 06/09/05 GREENSPAN: SOFT SPRING NOT SIGN OF MORE SERIOUS SLUMP

[54anickel]

24. I found your post yesterday regarding Snowjob very disturbing

So much for that independent Fed we're supposed to have. I think we are in some serious doo-doo here.

There seems to have been an awful lot of "engineering" going on behind the scenes since the markets tanked that we will never know the truth about. So, how does 9-11 and the war on terra really fit into all of this stuff? :tinfoilhat:


http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=102&topic_id=1531847#1533082

[54anickel]

27. Text of Greenspan's Testimony Before Joint Economic Committee

http://www.bloomberg.com/apps/news?pid=10000103&sid=af7PMmQpK5oM&refer=us

Not up at the Fed site yet :shrug: http://www.federalreserve.gov/BoardDocs/Speeches/2005/

[ozymandius]

38. Daddy Greenspan, tell me another story...

[54anickel]

44. I love that pic!...eom

[54anickel]

25. 10:59 numbers and some yada

Dow 10,463.26 -13.60 (-0.13%)
Nasdaq 2,057.72 -2.46 (-0.12%)
S&P 500 1,193.59 -1.08 (-0.09%)
10-Yr Bond 3.995% +0.05
NYSE Volume 487,674,000
Nasdaq Volume 470,113,000

10:30AM : Major averages continue to trade below the flat line, as all eyes remain focused on Greenspan's testimony... Meanwhile, as the market awaits more Q&A, investors have had one scheduled economic report to digest... Earlier, the Labor Dept. showed that initial claims fell 21K to 330K (consensus 335K) - a level consistent with gains of 175K per month in nonfarm payrolls and roughly in line with the White House's recent estimate of 178K... However, the claims data have taken a back seat to the Fed Chairman's ongoing remarks on the state of the economy...NYSE Adv/Dec 1058/1707, Nasdaq Adv/Dec 1026/1483
10:00AM : Market still trades with a tinge of caution, as the bulk of sector leadership remains negative... The Materials sector has paced the way lower, as the dollar continues to recover against major currencies, while rising bond yields continue to weigh on interest-rate sensitive sectors like Financial and Utilities... A Morgan Stanley downgrade on United Parcel Service (UPS 70.85 -1.51) has weighed heavily on Industrials while losses in Semiconductor overshadow gains in Storage to keep Technology slightly below the flat line...

Energy, however, has shown relative strength, benefiting from a rebound in oil prices... Health Care has also posted a modest gain amid continued momentum in HMOs and gains in biotech, following positive Phase II Rituxan results (DNA and BIIB)... DJTA -0.9, SOX -0.6, NYSE Adv/Dec 716/1804, Nasdaq Adv/Dec 745/1574

9:40AM : Stocks open slightly lower, as sentiment remains cautious ahead of Greenspan's testimony about the economy and monetary policy... At the top of the hour, the Fed Chairman is scheduled to testify before the Joint Economic Committee, with investors hoping to get a clearer picture on the outlook for long-term yields, inflation trends and whether the current round of Fed tightening is nearing an end...

Meanwhile, the Treasury market remains under modest pressure amid speculation the Fed might highlight a possible rise in inflationary pressures, given the recent acceleration in compensation and unit labor costs, as the 10-year note is off 11 ticks to yield 3.97%...

[54anickel]

26. More Conflicting Data

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

Evidence continued to mount that economic growth is intermittent. In April, employers added 274,000 jobs, 100,000 more jobs than economists expected. This was reversed in May when only 78,000 workers were added to payrolls, which was almost 100,000 fewer than forecasted. Additionally, this was the least number of jobs created since August 2003. Adding to the recent spate of confusing economic data, the household survey showed that 376,000 jobs were added in May. Since the household survey is used to calculate the unemployment rate, unemployment declined to 5.1%, the lowest since September 2001. Another data point that questions the weakness of the recent employment report was that 12.3% of the work force left their job in May. This was the highest since August 2001. This signals a healthy labor market as it shows workers are able to leave their job and gain better employment elsewhere.

The ISM non-manufacturing survey fell 3.2 points to 58.5. Not only was the index lower than economists predicted, it was the lowest reading since May 2003. It should be noted that while the index has fallen to a two-year low, it remains higher than 50 indicating that the service sector expanded in May. Most of the weakness was in inventories (-3.0) and prices (-4.0). The price component has dropped every month this year as the rapid price increases that companies reported last year have started to anniversary. Export orders surged 9.5 points to 62.0. The recent strength in the dollar will likely temper future export growth. One interesting quote from the ISM reports came from a manager of a business services firm: “Economic uncertainties and frequently fluctuating pricing for products and services globally are causing companies to postpone purchases.”

snip>

Second quarter earnings pre-announcements have been decidedly more negative than last year, and slightly more so than during the first quarter. There have been 91 S&P 500 companies that have announced that earnings would be below previous guidance compared to only 34 that have raised guidance. Last year, only 66 of the S&P 500 guided earnings down, while 81 said earnings would be better than initially forecasted. These pre-announcements have caused the aggregate earnings growth of the S&P 500 to be reduced to 6.7% from 8.8% at the beginning of the quarter. Analysts are much more optimistic regarding the second half. Earnings growth is expected to accelerate in the third quarter to 15.2% and a healthy 12.1% during the fourth quarter. :rofl:

Economists and analysts have different views on the second half of year. Economists expect the economy to slow later this year, but equity analysts expect earnings growth to accelerate from the first-half. The volume of conflicting data makes this a difficult economic environment to analyze. While the pace of growth is questionable, there is no doubt that the economy has continued to expand this year. There is also no doubt that certain areas of the economy, namely residential housing, are expanding at a unsustainable pace. Similar to the technology boom during the late 1990s, this is causing imbalances in the economy that will only be rectified once the boom is over. Unfortunately, these booms are not resolved in a measured manner.

[54anickel]

28. The Scramble to Protect Personal Information

http://www.nytimes.com/2005/06/09/business/09data.html?adxnnl=1&adxnnlx=1118314810-4M7p2IVevOIVGnaaJ3ZxbQ

snip>

Given that 10 million consumers are now falling victim to some form of identity theft each year, according to the Federal Trade Commission, the stakes are high.

"I think there are some people who dismiss this as a sky-is-falling problem," Mr. Gibbons said. "But the sky has already fallen and it's just a matter of when a piece hits you in the head."

snip>

That is a start, Mr. Schneier said, but he said the fact that highly sensitive data was still being shipped by courier - on unencrypted tapes, as in the CitiFinancial case and in a loss of Time Warner employee data in transit earlier this year - is evidence that data aggregators of all stripes, acting rationally, have no particular incentive to speed the adoption of new and expensive methods of handling data.

"This is a capitalist society," Mr. Schneier said, suggesting that no company can be expected to spend money to improve things simply "for the public good."

Rather, "I believe we need actual liability or penalties associated with doing this," Mr. Schneier said. "It doesn't matter if it's made public or not. There must be a penalty. If you could say you have to pay the government $1,000 per name lost, the risk of the loss triggers the increased security."

snip>

Senator Charles E. Schumer, Democrat of New York, has proposed the creation of an Office of Identity Theft under the auspices of the F.T.C., which would establish minimum security standards for any entity handling sensitive personal data, including Social Security and driver's license numbers, medical information and credit and bank account information. Failure to meet such "reasonable standards," according to Mr. Schumer's proposal, could result in fines of up to $1,000 per consumer affected.

Uh, Charlie, that would include just about every entity in existance these days. Sheesh, have you tried to apply for a job, or phone and utility services lately? How about a stinking check cashing card from the neighborhood grocery store? There is no privacy anymore - if you want to be part of society and not live in a cave like a hermit. Complete background and credit checks have become the norm in our society. When will you do something about THAT?

more...

[54anickel]

29. 11:51 and a sudden joyfulness in that last 1/2 hour

Dow 10,495.93 +19.07 (+0.18%)
Nasdaq 2,062.81 +2.63 (+0.13%)
S&P 500 1,197.68 +3.01 (+0.25%)
10-Yr Bond 39.69 +0.29 (+0.74%)
NYSE Volume 706,595,000
Nasdaq Volume 665,471,000

11:30AM: Modestly bearish tone persists in stocks as the indices still vacillate below the unchanged mark... Bucking the overall negative tone, however, have been Education stocks, recently surging to session highs following Greenspan's comments regarding the need to put out more competitive workers and improve education efforts... Notable movers to the upside include CECO (+4.5%), APOL (+2.6%), COCO (+1.3%) and STRA (+1.2%)...
Also, even though Homebuilding stocks remain under pressure, due largely to rising bond yields, the group has pared some of its losses after Greenspan said a "bubble" in home prices for the nation as a whole does not appear likely... NYSE Adv/Dec 1112/1874, Nasdaq Adv/Dec 1129/1568

11:00AM: Stocks show some improvement, as investors continue to digest Greenspan's remarks before Congress, but the market still trades in negative territory... While the Fed Chairman has said it is difficult to forecast what the "so-called neutral rate is," implying that it may be premature to set a deadline for an eventual end to Fed tightening, Greenspan has said that we may be close... Greenspan's lack of admiration for the consumer price index, pointing out that we have yet to see if unit labor costs feed into inflation, has also improved sentiment...

In response, Treasurys have also improved their stance somewhat, as yields on the 10-year note (-9/32), which recently flirted with 4.0%, have fallen back to around 3.96%...NYSE Adv/Dec 916/1985, Nasdaq Adv/Dec 962/1674

[54anickel]

30. Some 600,000 Join Millionaire Ranks in 2004

Some 600,000 People Join Millionaire Ranks Worldwide in 2004 on Strong Global Economy

http://biz.yahoo.com/ap/050609/world_wealth.html?.v=4

NEW YORK (AP) -- A strong global economy gave 600,000 people an entree last year into a highly envied group: the world's millionaires.

The annual World Wealth Report, released Thursday by Merrill Lynch & Co. Inc. and the Capgemini Group consulting firm, found that there were 8.3 million people worldwide with $1 million or more in financial assets at the end of 2004, up from 7.7 million a year earlier.

Their total wealth rose 8.2 percent to $30.8 trillion in 2004, giving them control of nearly a quarter of the world's financial assets, according to Petrina Dolby, vice president of Capgemini's wealth management practice.

The 8.2 percent increase was the strongest since an identical 8.2 percent rise in 1999, she said.

Not surprisingly, the expansion of the millionaire class was especially strong in North America because of the solid economic growth last year in both the United States and Canada.

more...

[54anickel]

31. 12:20 update, then I've gotta run

Dow 10,496.45 +19.59 (+0.19%)
Nasdaq 2,070.05 +9.87 (+0.48%)
S&P 500 1,198.46 +3.79 (+0.32%)
10-Yr Bond 3.963% +0.02
NYSE Volume 817,056,000
Nasdaq Volume 785,363,000

12:00PM : Market moves into positive territory and trades near its best levels midday, as Greenspan's lack of concern over inflation counters dashed expectations of an end to further rate hikes... While the Fed Chairman has said that the economy is on a "firm footing," he has also reaffirmed that benchmark interest rates may keep rising at a "measured pace," challenging the hopes of many that Fed tightening is nearing an end...
However, it appears the market has embraced Greenspan's lack of admiration for the consumer price index and the reality that we have yet to see whether "unit costs will feed into the core price level (inflation) or will be absorbed by a fall in profit margins."... Such mixed remarks have recently improved sentiment across the board and pared losses in the Treasury market, as six out of ten economic sectors now trade in positive territory... Energy has paced the way higher, as crude oil prices ($53.50/bbl +0.96) continue to climb amid the forming of this year's first tropical storm... However, the more influential Financial sector, benefiting from a recovery effort in bonds, has provided the majority of the leadership behind the market's turnaround...

The benchmark 10-year note is off 7 ticks to yield 3.96%... Health Care has also been strong, getting a boost from HMOs and Biotech, while Technology has also shown relative strength, as gains Networking, Hardware and Software offset modest weakness in Semiconductor... Chip stocks have been in focus all morning ahead of Intel's (INTC 27.31 +0.21) mid-quarter update after the bell, National Semiconductor's (NSM 19.78 -0.12) Q4 earnings during market hours and following analyst downgrades on Xilinx (XLNX 27.14 -0.94) - after cutting its Q1 gross margin forecast - and Taiwan Semiconductor (TSM 9.58 -0.03)...

The Materials sector, however, continues to pace the way to the downside due to broad-based weakness spurred by a strengthening dollar while an analyst downgrade on United Parcel Service (UPS 70.85 -1.51) continues to pressure Industrials... Separately, initial claims fell 21K to 330K (consensus 335K), a level consistent with gains of 175K per month in nonfarm payrolls, but since the data were roughly in line with expectations and Greenspan's testimony took precedence, the report failed to have as much of an impact as it has in previous weeks... DJTA -0.5, DOT +0.2, Nasdaq 100 +0.4, Russell 2000 +0.1, SOX -0.2, S&P Midcap 400 +0.3, XOI +1.6, NYSE Adv/Dec 1368/1651, Nasdaq Adv/Dec 1298/1455

Advances & Declines
NYSE Nasdaq
Advances 1537 (47%) 1441 (48%)
Declines 1514 (46%) 1341 (45%)
Unchanged 184 (5%) 177 (5%)

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

Up Vol* 442 (58%) 476 (64%)
Down Vol* 296 (39%) 228 (31%)
Unch. Vol* 12 (1%) 30 (4%)

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

New Hi's 68 42
New Lo's 19 35

[UpInArms]

32. U.S. federal debt rises at fastest quarterly pace in 2 years

http://www.marketwatch.com/news/story.asp?guid=%7B6AC8856D%2DCB33%2D46F3%2DA218%2DAE15D52517B5%7D&siteid=mktw

WASHINGTON (MarketWatch) -- The amount of new debt taken on by Americans rose 10% in the first quarter, to $24.8 trillion, the Federal Reserve said Thursday. It was the fastest growth since the second quarter of 2003.

Federal government debt rose 13.8%, its fastest quarterly pace in two years. U.S. mortgage debt rose 10.5% in the first quarter and business debt rose 7.5%, the Fed said. Read the Flow of Funds report.

At the end of the first quarter, federal debt held by the public was slightly more than $4.5 trillion.

<snip>

The net worth of households' equities fell by $122 billion, and mutual funds' value declined by $21 billion, the Fed said. The value of pension fund reserves also dropped by $237 billion.

...more...

[UpInArms]

34. 1:00 EST numbers and some old blather

Dow 10,514.41 +37.55 (+0.36%)
Nasdaq 2,074.35 +14.17 (+0.69%)
S&P 500 1,200.37 +5.70 (+0.48%)
10-Yr Bond 3.972 +0.32 (+0.81%)

NYSE Volume 977,075,000
Nasdaq Volume 928,674,000

12:30PM: Equities extend their reach into positive territory, as market internals now hold a mixed bias... Decliners on the NYSE hold a slim 15 to 14 advantage over advancers while advancing issues on the Nasdaq hold a 14 to 13 edge over declining issues... The ratio of up to down volume, however, holds a more positive tone to trading at both the Big Board and the Composite... Meanwhile, the Dow, S&P and Nasdaq continue to trade well above initial support levels, but the major averages have run into modest resistance near levels of 10520, 1200 and 2076, respectively...NYSE Adv/Dec 1461/1577, Nasdaq Adv/Dec 1421/1361

12:00PM: Market moves into positive territory and trades near its best levels midday, as Greenspan's lack of concern over inflation counters dashed expectations of an end to further rate hikes... While the Fed Chairman has said that the economy is on a "firm footing," he has also reaffirmed that benchmark interest rates may keep rising at a "measured pace," challenging the hopes of many that Fed tightening is nearing an end...

However, it appears the market has embraced Greenspan's lack of admiration for the consumer price index and the reality that we have yet to see whether "unit costs will feed into the core price level (inflation) or will be absorbed by a fall in profit margins."... Such mixed remarks have recently improved sentiment across the board and pared losses in the Treasury market, as six out of ten economic sectors now trade in positive territory... Energy has paced the way higher, as crude oil prices ($53.50/bbl +0.96) continue to climb amid the forming of this year's first tropical storm...

[MARALE]

35. What's this doing on page 2?

kick!

[DoBotherMe]

37. KICK n/t

[RawMaterials]

36. 2:13 Market Update and Blather

Dow 10492.60 +15.74 (+0.15%)
Nasdaq 2071.46 +11.28 (+0.55%)
S&P 500 1199.07 +4.40 (+0.37%)
10-Yr Bond 3.966% +0.26
NYSE Volume 1,214,372,000
Nasdaq Volume 1,123,953,000


2:00PM: More of the same for stocks, as blue chip indices hold onto modest gains... On the Dow, ExxonMobil (XOM 58.11 +1.38) remains the best performing component, as oil prices continue to climb (+2.8%), while Intel (INTC 27.45 +0.35) has maintained solid gains heading into its mid-quarter update...

Shares of Hewlett-Packard (HPQ 22.84 +0.41), after revealing groundbreaking design for future Nano-electronic circuits, have also surged while gains from the likes of CAT (97.43 +0.85), IBM (75.19 +0.39), MO (69.41 +0.66) and BA (65.00 +0.53) have also provided some buying support on the price-weighted index... Alcoa (AA 26.84 -0.44), however, remains under pressure as a strengthening greenback weighs on dollar-denominated commodities like Aluminum...NYSE Adv/Dec 1678/1448, Nasdaq Adv/Dec 1616/1284

1:30PM: Sellers show some resolve, nearly halving recent market gains... Perhaps contributing to some of the consolidation has been a continued surge in crude oil prices, which are now up 2.2% at 53.70/bbl (+$1.16)... Ongoing pressure on Treasurys, which have kept yields on the 10-year note (-11/32) at around 3.97%, have also stalled recent buying efforts...

Since Greenspan did not signal an end to rate hikes, bonds have struggled all day, most recently slipping after an $8.0 bln 10-year note auction awarded investors 3.990% - the lowest yield since investors were awarded 3.752% in March 2004 - as indirect bidder participation checked in at 10.8%...NYSE Adv/Dec 1747/1359, Nasdaq Adv/Dec 1653/1202

[ozymandius]

39. The witching hour approaches.

2:59
Dow 10,494.80 +17.94 (+0.17%)
Nasdaq 2,072.03 +11.85 (+0.58%)
S&P 500 1,199.50 +4.83 (+0.40%)
10-Yr Bond 39.62 +0.22 (+0.56%)

NYSE Volume 1,387,128,000
Nasdaq Volume 1,273,778,000

2:30PM: Renewed wave of selling interest, spurred by soaring oil prices heading into the close of commodities trading, takes some more steam out of the market's post-Greenspan turnaround... Crude oil futures ($54.35/bbl +$1.81) are now up more than 3.3%, as news of the first tropical storm of the 2005 Atlantic hurricane season has forced some large oil companies to remove personnel from oil platforms... XOI +2.1, NYSE Adv/Dec 1702/1451, Nasdaq Adv/Dec 1662/1277

[ozymandius]

40. 3:13

Dow 10,499.69 +22.83 (+0.22%)
Nasdaq 2,074.54 +14.36 (+0.70%)
S&P 500 1,200.53 +5.86 (+0.49%)
10-Yr Bond 39.66 +0.26 (+0.66%)
NYSE Volume 1,456,851,000
Nasdaq Volume 1,330,425,000


3:00PM: Market stages another recover effort heading into the final hour of trading... Meanwhile, even though Greenspan's comments about low bond yields have provided some support to interest-rate sensitive areas like Financial and Homebuilding, the Utilities sector has so far failed to follow suit... Weighing heavily on the sector has been a Prudential downgrade on FPL Group (FPL 40.83 -0.28), to Neutral Weight from Overweight, based on valuation...
Related utilities also trading near 52-weeks but under pressure in sympathy with FPL, as valuations could become a concern, include: EXC (-0.8%), EIX (-0.7%), SO (-0.4%) and ETR (-0.4%)...NYSE Adv/Dec 1674/1492, Nasdaq Adv/Dec 1694/1255

[MARALE]

41. It is trying so hard..

It is hard work getting above that 10500 mark!
I wonder if it will make it?

:popcorn:

[ozymandius]

42. not quite yet

3:38Dow 10,495.85 +18.99 (+0.18%)
Nasdaq 2,073.77 +13.59 (+0.66%)
S&P 500 1,200.15 +5.48 (+0.46%)
10-Yr Bond 39.65 +0.25 (+0.63%)
NYSE Volume 1,589,555,000
Nasdaq Volume 1,442,564,000

3:30PM: Major indices continue to hold their own as chip stocks show no signs of slowing heading into Intel's mid-quarter update... Ever since National Semiconductor (NSM 21.52 +1.62) posted better than expected Q4 earnings right around 12:00 ET, the PHLX Semiconductor Index (+1.6%) has continued to climb... But since Intel (INTC 27.66 +0.56) has the ability to dramatically move markets, all signs suggesting that the chip giant will at least narrow its previously issued Q2 revenue guidance of $8.6-9.2 bln to the higher end of its range, has provided the largest lift to overall market sentiment... SOX +1.6, NYSE Adv/Dec 1812/1387, Nasdaq Adv/Dec 1720/1248

[ozymandius]

43. squeaked over 10500 at the close

Dow 10,503.02 +26.16 (+0.25%)
Nasdaq 2,076.91 +16.73 (+0.81%)
S&P 500 1,200.93 +6.26 (+0.52%)
10-Yr Bond 39.65 +0.25 (+0.63%)
NYSE Volume 1,797,822,000
Nasdaq Volume 1,627,485,000

blather forthcoming...

Close: Stocks opened with a tinge of caution ahead of Greenspan's testimony before the Joint Economic Committee, but since his comments provided no surprises and hinted at no signs of an economic slowdown amid manageable inflationary pressures, an improved sentiment lifted the indices into the green for good... In prepared remarks, the Fed Chairman said that "the U.S. economy seems to be on a reasonably firm footing, and underlying inflation remains contained."...

While such economic growth dismissed expectations of a sooner than anticipated end to further rate hikes, as Greenspan said it is difficult to forecast what the "so-called neutral rate is," the fact that he said "we may be close" to an eventual end to Fed tightening surely helped... Expectations that Intel (INTC 27.70 +0.60) may narrow its Q2 revenue forecasts to the higher end of its range after the bell also provided a floor of buying support that lifted overall sentiment, as seven out of ten economic sectors closed in positive territory...

With regard to sector strength and weakness, Energy paced the way higher, taking full advantage of a surge in oil prices...

Crude oil futures ($54.28/bbl +$1.74) soared 3.3% amid news that the first tropical storm of the 2005 Atlantic hurricane season forced some large oil companies to remove personnel from oil platforms... Reports that ChevronTexaco (CVX 56.04 +1.21) and Unocal (UCL 60.19 +1.72) have reached a proposed settlement with the FTC to clear way for their proposed $16.4 bln merger also provided support... But while Energy provided the majority of market leadership, Technology was the most influential leader to the upside, benefiting from strong gains across the board...

[54anickel]

45. Heh-heh, how long can Greenspin keep up the charade?

Independent Fed?




And for his next trick...