AI
Wednesday, January 09, 2008 7:12:10 PM
Market Update 080109
http://biz.yahoo.com/mu/update.html
4:15 pm : It was another roller coaster day of trade on Wednesday, with economic concerns once again in focus, but this time stocks ended at their session highs. The major indices closed with significant gains after a late day surge on a sense that the recent selling was overdone. Beaten down sectors financials and tech led the comeback.
Discussion on the economic outlook fueled volatility in Wednesday's trade.
Goldman Sachs said it expects a recession in 2008, citing economic data over the last few weeks led it to this conclusion. On CNBC, the firm's Chief Economist said the U.S. is in a recession or will be there shortly, noting the increase in unemployment. Merrill Lynch and Morgan Stanley have also predicted a recession, according to Bloomberg.com.
St. Louis Fed President Poole painted a more positive picture after he said U.S. economic fundamentals remain strong and 2008 looks to be a year of rising growth. He also noted it is too early to tell if housing problems will push the economy into a recession. He said low inflation expectations give the Fed "breathing room," indicating the Fed may cut interest rates further. He believes it would be a mistake to say that a recession is clearly at hand. Poole is not a voting FOMC member in 2008, but was in 2007.
In corporate news, MBIA (MBI 13.40, -0.58) announced it is cutting its dividend to $0.13 from $0.34 and is offering a $1 billion surplus note offering. Fitch Ratings said if the offering is successful, it will retain its credit rating on MBIA. Its stock finished down 4%, which was well above it lows of the day, when it was down more than 20%.
Dow Component DuPont (DD 44.78, +2.03) lifted its profit forecast for fiscal 2007 and 2008. Investors responded positively to the news, sending shares of the company higher.
All ten sectors finished with a gain. The tech sector provided leadership, which helped the Nasdaq Composite snap an eight day losing streak. Financials (+1.7%) also provided leadership. Telecom (+0.1%) underperformed on a relative basis due to yesterday's consumer weakness warnings from AT&T's (T 39.00, -0.16) CEO.
In commodity trading, crude oil traded in a choppy manner after the government said inventories declined by a larger than expected amount. After several swings, crude finished the day down $0.78 to $95.55 per barrel.DJ30 +146.24 NASDAQ +34.04 NQ100 +2.0% R2K +1.0% SP400 +0.5% SP500 +18.94 NASDAQ Dec/Adv/Vol 1561/1474/2.86 bln NYSE Dec/Adv/Vol 1290/1872/+2.06 bln
3:30 pm : Buyers are coming off the sidelines, sending the major indices to their best levels of the session. Only telecom (-0.3%) remains in negative territory. Tech (+1.8%) is playing a large role in the recent gains as is financials (+1.0%).
There is not a specific headline that accounts for the spike, but there is strength in some of the bigger financial names, including Merrill Lynch (MER 59.73, +1.56) and Morgan Stanley (MS 47.32, +1.19).
Tomorrow, the weekly initial jobless claims and wholesale inventories readings are slated for release. Briefing.com expects jobless claims to tick up to 345K and wholesale inventories to rise 0.4%. Fed Chairman Ben Bernanke is scheduled to talk tomorrow, and investors will be paying close attention to any hints of further rate cuts. DJ30 +84.12 NASDAQ +16.17 SP500 +10.76 NASDAQ Dec/Adv/Vol 1771/1235/2.26 bln NYSE Dec/Adv/Vol 1705/1432/1.47 bln
3:00 pm : Stocks rebound back into positive territory in a broad-based move. The major indices are now trading near the unchanged mark.
14 of the 30 Components in the Dow are posting a gain. DuPont (DD) is leading the way after raising its 2007 and 2008 outlook. Defensive names Johnson & Johnson (JNJ 68.10, +1.16) and Coca-Cola (KO 65.04, +1.47) are also providing leadership.
Crude oil closed 78 cents lower to $95.55 per barrel. The dollar is up 0.47% against a basket of currencies.DJ30 +9.18 NASDAQ +0.69 SP500 +1.23 NASDAQ Dec/Adv/Vol 2135/844/1.98 bln NYSE Dec/Adv/Vol 2091/1023/1.29 bln
2:30 pm : The bulls are not pleased with 2008, as stocks remain in the red. The Dow and S&P are down roughly 12% from their October highs and the Nasdaq is down 15% from its high. Both mark a technical "correction," which is typically defined as a 10% drop from recently reached highs.
The financial sector (-1.5%) is now the main laggard with all 19 of its industry groups in the red. The thrifts & mortgages group (-4.9%) is showing the main weakness. The S&P 500 Retailing Index (-3.3%) is also under pressure.DJ30 -45.04 NASDAQ -20.88 SP500 -6.11 NASDAQ Dec/Adv/Vol 2195/766/1.77 bln NYSE Dec/Adv/Vol 2052/1046/1.11 bln
2:05 pm : The stock market extends its losses after an increase in broad-based selling pressure. Only healthcare (+1.2%) and utilities (+0.1%) remain in positive territory.
The Nasdaq Composite is underperforming. 65 of the 100 stocks in the Nasdaq 100 are posting a loss. Garmin (GRMN 70.97, -9.00) and Amazon.com (AMZN 81.83, -6.05) are showing the most weakness. Qualcomm (QCOM 37.08, +1.11) and Microsoft (MSFT 34.10, +0.65) are outperforming.DJ30 -59.02 NASDAQ -21.91 SP500 -7.62 NASDAQ Dec/Adv/Vol 2108/838/1.60 bln NYSE Dec/Adv/Vol 1986/1119/1.05 bln
1:30 pm : Stocks fall back near their session lows and are posting modest losses.
Market breadth paints a negative picture. Decliners outpace advancers by a 1.5-to-1 margin on the NYSE. The Nasdaq comes in at 2-to-1. New lows outpace new highs by more than 24-to-1.
Airlines are down 4% despite being upgraded at UBS to Buy from Neutral. UBS said the stocks are less overvalued given the recent pullback, and that the announcement of a major merger is likely within the next six months.DJ30 -13.96 NASDAQ -12.91 SP500 -2.83 NASDAQ Dec/Adv/Vol 1917/1018/1.41 bln NYSE Dec/Adv/Vol 1838/1239/924 mln
1:00 pm : More choppy action as the stock market dips back a bit and falls to the unchanged mark. The Nasdaq Composite is underperforming as it falls into negative territory. The Composite has ended eight straight sessions lower, and is posting a loss of 8% in 2008.
Small- and mid-cap stocks are underperforming, as investors remain risk averse. The Russell 2000 is down 0.9% and the S&P 400 Midcap is down 0.9%.DJ30 +17.64 NASDAQ -4.22 SP500 +1.00 NASDAQ Dec/Adv/Vol 1936/972/1.31 bln NYSE Dec/Adv/Vol 1837/1221/854 mln
12:35 pm : The major indices rebound as selling pressure eases. The stock market is now trading with a slight gain.
Five of the ten sectors remain in the red, but there is relative strength in tech (+1.0%) and financials (-0.7%).
There are some positive stories today. Shares of education provider Apollo Group (APOL 76.17, +8.11) are up nearly 12% after the company reported earnings of $0.83, topping estimates by $0.10. Apollo is a for-profit education provider, operating schools such as the University of Phoenix.DJ30 +33.65 NASDAQ +2.30 SP500 +3.24 NASDAQ Dec/Adv/Vol 1876/999/1.17 bln NYSE Dec/Adv/Vol 1865/1176/757 mln
12:00 pm : It has been another choppy day of trading for the stock market as sentiment remains shaky. The major indices are currently trading with modest losses as financials continue to weigh on the broader market.
Stocks were set to open modestly higher on news that Dow Component DuPont (DD 44.86, +2.11) raised its earnings outlook for 2007 and 2008.
The positive bias was short-lived, as economic concerns weighed on investors. Goldman Sachs said it expects a recession in 2008, citing economic data over the last few weeks led it to this conclusion. On CNBC, the firm's Chief Economist said the U.S. is in a recession or will be there shortly, noting the increase in unemployment. Merrill Lynch and Morgan Stanley have also predicted a recession, according to Bloomberg.com.
St. Louis Fed President Poole painted a more positve picture after he said U.S. economic fundamentals remain strong and 2008 looks to be a year of rising growth. He also noted it is too early to tell if housing problems will push the economy into a recession. He said low inflation expectations give the Fed "breathing room," indicating the Fed may cut interest rates further. He believes it would be a mistake to say that a recession is clearly at hand.
In corporate news, MBIA (MBI 12.20, -1.78) announced it is cutting its dividend to $0.13 from $0.34 and is offering a $1 billion surplus note offering. Fitch Ratings said if the offering is successful, it will retain its credit rating on MBIA. It stock opened higher on the news, but quickly dropped into negative territory.
Five of the ten sectors are trading lower. Investor nervousness is apparent with the continued underperformance of financials (-1.5%) and consumer discretionary (-1.0%), and the outperformance of defensive sectors healthcare (+1.3%) and utilities (+0.5%). The telecom sector (-1.4%) is again getting clipped. AT&T (T 38.74, -0.42) continues to be under pressure following its CEO's warning yesterday of weakness in consumer demand.
In commodity trading, crude oil has traded in a choppy manner after the government said inventories fell by a larger than expected amount. Crude is currently trading up 1% to $97.35 per barrel. DJ30 -6.34 NASDAQ -8.81 SP500 -2.89 NASDAQ Dec/Adv/Vol 1787/1064/977 mln NYSE Dec/Adv/Vol 1648/1358/634 mln
11:30 am : Stocks continue to trade with modest gains, although financials (-0.6%) have dipped back into the red. Healthcare (+1.4%) is providing leadership, and is the best performing sector this year, up 3.0%. Utilities (+0.7%) is also providing leadership as nervous investors look to build up defensive positions.
Crude oil has spiked, and is now up 1.6% to $97.88. The strength is being attributed to comments from the Iranian Oil Minister, who said he expects oil prices to go "well beyond $100 per barrel," according to Bloomberg.
DJ30 +37.80 NASDAQ +2.07 SP500 +2.65 NASDAQ Dec/Adv/Vol 1543/1283/833 mln NYSE Dec/Adv/Vol 1576/1402/538 mln
11:00 am : Buying interest picks up, with the indices regaining some ground. Relative strength is being seen in financials (+0.1%).
St. Louis Fed President Poole said low inflation expectations give the Fed "breathing room," indicating the Fed may cut interest rates further. He said it would be a mistake to say that a recession is clearly at hand.
Crude traded in a choppy manner following the government's weekly statistics, as it usually does. Crude is currently trading up 0.3% to $96.62.DJ30 +67.30 NASDAQ +12.34 SP500 +5.40 NASDAQ Dec/Adv/Vol 1488/1259/641 mln NYSE Dec/Adv/Vol 1533/1370/397 mln
10:30 am : Stocks are trading in a choppy manner as they give up much of their gains from their recently reached highs. The dip has been broad-based but there is relative weakness in financials (-0.9%).
Just reported, crude oil inventories for the week ended Jan. 5 fell by 6.74 million barrels. Analysts expected stockpiles to decline by a smaller 2.1 million barrels. Crude was trading down 0.5% to $95.81 just prior to the announcement.
Telecom continues to underperform as shares of AT&T (T 38.42, -0.74) continue to slide. AT&T's stock fell 4.6% yesterday after its CEO warned of weakness in consumer demand.DJ30 +42.43 NASDAQ +9.36 SP500 +3.39 NASDAQ Dec/Adv/Vol 1281/1389/448 mln NYSE Dec/Adv/Vol 1380/1453/275 mln
10:00 am : Stocks rebound into positive territory shortly after reassuring comments from a Fed official. Gains are modest.
St. Louis Fed President Poole said U.S. economic fundamentals remain strong and 2008 looks to be a year of rising growth. He also noted it is too early to tell if housing problems will push the economy into a recession.
Six of the ten economic sectors are in positive territory, led by a bounce in technology (+1.0%). Tech was the worst performing sector at yesterday's closing prices, down 10% in 2008.
Sentiment remains nervous as financials (-0.7%) and consumer discretionary (-0.6%) continue to underperform. DJ30 +44.95 NASDAQ +7.39 SP500 +2.29 NASDAQ Dec/Adv/Vol 1054/1354/171 mln
09:35 am : Despite the S&P 500 dropping 26 points yesterday, and shedding 5.3% in 2008, the stock market was not able to muster much of rebound at the open. The S&P is trading slightly lower, but is basically unchanged.
Stocks were set for a modestly higher open on news that Dow Component DuPont (DD) raised its earnings guidance for 2007 and 2008.
However, economic concerns again weighed on traders, after Goldman Sachs said the U.S. is likely in a recession or will be there shortly. Goldman's economist said the data over the last few weeks pushed them over the edge, noting the increase in the unemployment rate.
In other news, MBIA (MBI) announced it is cutting its dividend to $0.13 from $0.34 and is offering a $1 billion surplus note offering. Fitch Ratings said if the offering is successful, it will retain its credit rating on MBIA.DJ30 +13.41 NASDAQ -2.69 SP500 -1.07
09:14 am : S&P futures vs fair value: -1.3. Nasdaq futures vs fair value: -1.0.
08:59 am : S&P futures vs fair value: -2.3. Nasdaq futures vs fair value: -1.0. Futures shed a few points and now point to a slightly lower open. Fitch Ratings said it would affirm MBIA’s credit rating if its $1 billion offering is successful, according to Dow Jones, the stock is set to open higher. Dow Component Alcoa (AA) marks the start of earnings season with its report after the close. Crude (-0.2% to $96.12) is trading slightly lower ahead of the government’s weekly energy inventory report at 10:30 ET.
08:30 am : S&P futures vs fair value: +2.7. Nasdaq futures vs fair value: +5.8. Futures dip following a dividend reduction announcement, but are currently suggesting slightly higher open after recovering a bit. Bond insurer MBIA (MBI) announced it is reducing its quarterly dividend to $0.13 from $0.34. The struggling company also announced a $1 billion surplus note offering. Best Buy’s (BBY) CEO said he sees signs of a tougher retail climate, but does not see indications it is likely to be a really difficult one, according to Reuters. Retailers are down 9% in 2008.
08:00 am : S&P futures vs fair value: +2.8. Nasdaq futures vs fair value: +4.8. Futures trade indicates a slightly higher open following yesterday’s steep declines. Chemical maker DuPont (DD) raised its earning guidance for 2007 and 2008. As expected, Bear Stearns (BSC) chief executive James Cayne announced his resignation. The stock market is still shaky as investors continue to worry about the economy. Goldman Sachs said the U.S. is probably slipping into recession, according to Bloomberg.
06:20 am : S&P futures vs fair value: +4.9. Nasdaq futures vs fair value: +5.3.
06:19 am : FTSE...6288.80...-67.70...-1.1%. DAX...7811.16...-38.85...-0.5%.
06:19 am : Nikkei...14599.16...+70.49...+0.5%. Hang Seng...27615.85...+502.95...+1.9%.
http://biz.yahoo.com/mu/update.html
4:15 pm : It was another roller coaster day of trade on Wednesday, with economic concerns once again in focus, but this time stocks ended at their session highs. The major indices closed with significant gains after a late day surge on a sense that the recent selling was overdone. Beaten down sectors financials and tech led the comeback.
Discussion on the economic outlook fueled volatility in Wednesday's trade.
Goldman Sachs said it expects a recession in 2008, citing economic data over the last few weeks led it to this conclusion. On CNBC, the firm's Chief Economist said the U.S. is in a recession or will be there shortly, noting the increase in unemployment. Merrill Lynch and Morgan Stanley have also predicted a recession, according to Bloomberg.com.
St. Louis Fed President Poole painted a more positive picture after he said U.S. economic fundamentals remain strong and 2008 looks to be a year of rising growth. He also noted it is too early to tell if housing problems will push the economy into a recession. He said low inflation expectations give the Fed "breathing room," indicating the Fed may cut interest rates further. He believes it would be a mistake to say that a recession is clearly at hand. Poole is not a voting FOMC member in 2008, but was in 2007.
In corporate news, MBIA (MBI 13.40, -0.58) announced it is cutting its dividend to $0.13 from $0.34 and is offering a $1 billion surplus note offering. Fitch Ratings said if the offering is successful, it will retain its credit rating on MBIA. Its stock finished down 4%, which was well above it lows of the day, when it was down more than 20%.
Dow Component DuPont (DD 44.78, +2.03) lifted its profit forecast for fiscal 2007 and 2008. Investors responded positively to the news, sending shares of the company higher.
All ten sectors finished with a gain. The tech sector provided leadership, which helped the Nasdaq Composite snap an eight day losing streak. Financials (+1.7%) also provided leadership. Telecom (+0.1%) underperformed on a relative basis due to yesterday's consumer weakness warnings from AT&T's (T 39.00, -0.16) CEO.
In commodity trading, crude oil traded in a choppy manner after the government said inventories declined by a larger than expected amount. After several swings, crude finished the day down $0.78 to $95.55 per barrel.DJ30 +146.24 NASDAQ +34.04 NQ100 +2.0% R2K +1.0% SP400 +0.5% SP500 +18.94 NASDAQ Dec/Adv/Vol 1561/1474/2.86 bln NYSE Dec/Adv/Vol 1290/1872/+2.06 bln
3:30 pm : Buyers are coming off the sidelines, sending the major indices to their best levels of the session. Only telecom (-0.3%) remains in negative territory. Tech (+1.8%) is playing a large role in the recent gains as is financials (+1.0%).
There is not a specific headline that accounts for the spike, but there is strength in some of the bigger financial names, including Merrill Lynch (MER 59.73, +1.56) and Morgan Stanley (MS 47.32, +1.19).
Tomorrow, the weekly initial jobless claims and wholesale inventories readings are slated for release. Briefing.com expects jobless claims to tick up to 345K and wholesale inventories to rise 0.4%. Fed Chairman Ben Bernanke is scheduled to talk tomorrow, and investors will be paying close attention to any hints of further rate cuts. DJ30 +84.12 NASDAQ +16.17 SP500 +10.76 NASDAQ Dec/Adv/Vol 1771/1235/2.26 bln NYSE Dec/Adv/Vol 1705/1432/1.47 bln
3:00 pm : Stocks rebound back into positive territory in a broad-based move. The major indices are now trading near the unchanged mark.
14 of the 30 Components in the Dow are posting a gain. DuPont (DD) is leading the way after raising its 2007 and 2008 outlook. Defensive names Johnson & Johnson (JNJ 68.10, +1.16) and Coca-Cola (KO 65.04, +1.47) are also providing leadership.
Crude oil closed 78 cents lower to $95.55 per barrel. The dollar is up 0.47% against a basket of currencies.DJ30 +9.18 NASDAQ +0.69 SP500 +1.23 NASDAQ Dec/Adv/Vol 2135/844/1.98 bln NYSE Dec/Adv/Vol 2091/1023/1.29 bln
2:30 pm : The bulls are not pleased with 2008, as stocks remain in the red. The Dow and S&P are down roughly 12% from their October highs and the Nasdaq is down 15% from its high. Both mark a technical "correction," which is typically defined as a 10% drop from recently reached highs.
The financial sector (-1.5%) is now the main laggard with all 19 of its industry groups in the red. The thrifts & mortgages group (-4.9%) is showing the main weakness. The S&P 500 Retailing Index (-3.3%) is also under pressure.DJ30 -45.04 NASDAQ -20.88 SP500 -6.11 NASDAQ Dec/Adv/Vol 2195/766/1.77 bln NYSE Dec/Adv/Vol 2052/1046/1.11 bln
2:05 pm : The stock market extends its losses after an increase in broad-based selling pressure. Only healthcare (+1.2%) and utilities (+0.1%) remain in positive territory.
The Nasdaq Composite is underperforming. 65 of the 100 stocks in the Nasdaq 100 are posting a loss. Garmin (GRMN 70.97, -9.00) and Amazon.com (AMZN 81.83, -6.05) are showing the most weakness. Qualcomm (QCOM 37.08, +1.11) and Microsoft (MSFT 34.10, +0.65) are outperforming.DJ30 -59.02 NASDAQ -21.91 SP500 -7.62 NASDAQ Dec/Adv/Vol 2108/838/1.60 bln NYSE Dec/Adv/Vol 1986/1119/1.05 bln
1:30 pm : Stocks fall back near their session lows and are posting modest losses.
Market breadth paints a negative picture. Decliners outpace advancers by a 1.5-to-1 margin on the NYSE. The Nasdaq comes in at 2-to-1. New lows outpace new highs by more than 24-to-1.
Airlines are down 4% despite being upgraded at UBS to Buy from Neutral. UBS said the stocks are less overvalued given the recent pullback, and that the announcement of a major merger is likely within the next six months.DJ30 -13.96 NASDAQ -12.91 SP500 -2.83 NASDAQ Dec/Adv/Vol 1917/1018/1.41 bln NYSE Dec/Adv/Vol 1838/1239/924 mln
1:00 pm : More choppy action as the stock market dips back a bit and falls to the unchanged mark. The Nasdaq Composite is underperforming as it falls into negative territory. The Composite has ended eight straight sessions lower, and is posting a loss of 8% in 2008.
Small- and mid-cap stocks are underperforming, as investors remain risk averse. The Russell 2000 is down 0.9% and the S&P 400 Midcap is down 0.9%.DJ30 +17.64 NASDAQ -4.22 SP500 +1.00 NASDAQ Dec/Adv/Vol 1936/972/1.31 bln NYSE Dec/Adv/Vol 1837/1221/854 mln
12:35 pm : The major indices rebound as selling pressure eases. The stock market is now trading with a slight gain.
Five of the ten sectors remain in the red, but there is relative strength in tech (+1.0%) and financials (-0.7%).
There are some positive stories today. Shares of education provider Apollo Group (APOL 76.17, +8.11) are up nearly 12% after the company reported earnings of $0.83, topping estimates by $0.10. Apollo is a for-profit education provider, operating schools such as the University of Phoenix.DJ30 +33.65 NASDAQ +2.30 SP500 +3.24 NASDAQ Dec/Adv/Vol 1876/999/1.17 bln NYSE Dec/Adv/Vol 1865/1176/757 mln
12:00 pm : It has been another choppy day of trading for the stock market as sentiment remains shaky. The major indices are currently trading with modest losses as financials continue to weigh on the broader market.
Stocks were set to open modestly higher on news that Dow Component DuPont (DD 44.86, +2.11) raised its earnings outlook for 2007 and 2008.
The positive bias was short-lived, as economic concerns weighed on investors. Goldman Sachs said it expects a recession in 2008, citing economic data over the last few weeks led it to this conclusion. On CNBC, the firm's Chief Economist said the U.S. is in a recession or will be there shortly, noting the increase in unemployment. Merrill Lynch and Morgan Stanley have also predicted a recession, according to Bloomberg.com.
St. Louis Fed President Poole painted a more positve picture after he said U.S. economic fundamentals remain strong and 2008 looks to be a year of rising growth. He also noted it is too early to tell if housing problems will push the economy into a recession. He said low inflation expectations give the Fed "breathing room," indicating the Fed may cut interest rates further. He believes it would be a mistake to say that a recession is clearly at hand.
In corporate news, MBIA (MBI 12.20, -1.78) announced it is cutting its dividend to $0.13 from $0.34 and is offering a $1 billion surplus note offering. Fitch Ratings said if the offering is successful, it will retain its credit rating on MBIA. It stock opened higher on the news, but quickly dropped into negative territory.
Five of the ten sectors are trading lower. Investor nervousness is apparent with the continued underperformance of financials (-1.5%) and consumer discretionary (-1.0%), and the outperformance of defensive sectors healthcare (+1.3%) and utilities (+0.5%). The telecom sector (-1.4%) is again getting clipped. AT&T (T 38.74, -0.42) continues to be under pressure following its CEO's warning yesterday of weakness in consumer demand.
In commodity trading, crude oil has traded in a choppy manner after the government said inventories fell by a larger than expected amount. Crude is currently trading up 1% to $97.35 per barrel. DJ30 -6.34 NASDAQ -8.81 SP500 -2.89 NASDAQ Dec/Adv/Vol 1787/1064/977 mln NYSE Dec/Adv/Vol 1648/1358/634 mln
11:30 am : Stocks continue to trade with modest gains, although financials (-0.6%) have dipped back into the red. Healthcare (+1.4%) is providing leadership, and is the best performing sector this year, up 3.0%. Utilities (+0.7%) is also providing leadership as nervous investors look to build up defensive positions.
Crude oil has spiked, and is now up 1.6% to $97.88. The strength is being attributed to comments from the Iranian Oil Minister, who said he expects oil prices to go "well beyond $100 per barrel," according to Bloomberg.
DJ30 +37.80 NASDAQ +2.07 SP500 +2.65 NASDAQ Dec/Adv/Vol 1543/1283/833 mln NYSE Dec/Adv/Vol 1576/1402/538 mln
11:00 am : Buying interest picks up, with the indices regaining some ground. Relative strength is being seen in financials (+0.1%).
St. Louis Fed President Poole said low inflation expectations give the Fed "breathing room," indicating the Fed may cut interest rates further. He said it would be a mistake to say that a recession is clearly at hand.
Crude traded in a choppy manner following the government's weekly statistics, as it usually does. Crude is currently trading up 0.3% to $96.62.DJ30 +67.30 NASDAQ +12.34 SP500 +5.40 NASDAQ Dec/Adv/Vol 1488/1259/641 mln NYSE Dec/Adv/Vol 1533/1370/397 mln
10:30 am : Stocks are trading in a choppy manner as they give up much of their gains from their recently reached highs. The dip has been broad-based but there is relative weakness in financials (-0.9%).
Just reported, crude oil inventories for the week ended Jan. 5 fell by 6.74 million barrels. Analysts expected stockpiles to decline by a smaller 2.1 million barrels. Crude was trading down 0.5% to $95.81 just prior to the announcement.
Telecom continues to underperform as shares of AT&T (T 38.42, -0.74) continue to slide. AT&T's stock fell 4.6% yesterday after its CEO warned of weakness in consumer demand.DJ30 +42.43 NASDAQ +9.36 SP500 +3.39 NASDAQ Dec/Adv/Vol 1281/1389/448 mln NYSE Dec/Adv/Vol 1380/1453/275 mln
10:00 am : Stocks rebound into positive territory shortly after reassuring comments from a Fed official. Gains are modest.
St. Louis Fed President Poole said U.S. economic fundamentals remain strong and 2008 looks to be a year of rising growth. He also noted it is too early to tell if housing problems will push the economy into a recession.
Six of the ten economic sectors are in positive territory, led by a bounce in technology (+1.0%). Tech was the worst performing sector at yesterday's closing prices, down 10% in 2008.
Sentiment remains nervous as financials (-0.7%) and consumer discretionary (-0.6%) continue to underperform. DJ30 +44.95 NASDAQ +7.39 SP500 +2.29 NASDAQ Dec/Adv/Vol 1054/1354/171 mln
09:35 am : Despite the S&P 500 dropping 26 points yesterday, and shedding 5.3% in 2008, the stock market was not able to muster much of rebound at the open. The S&P is trading slightly lower, but is basically unchanged.
Stocks were set for a modestly higher open on news that Dow Component DuPont (DD) raised its earnings guidance for 2007 and 2008.
However, economic concerns again weighed on traders, after Goldman Sachs said the U.S. is likely in a recession or will be there shortly. Goldman's economist said the data over the last few weeks pushed them over the edge, noting the increase in the unemployment rate.
In other news, MBIA (MBI) announced it is cutting its dividend to $0.13 from $0.34 and is offering a $1 billion surplus note offering. Fitch Ratings said if the offering is successful, it will retain its credit rating on MBIA.DJ30 +13.41 NASDAQ -2.69 SP500 -1.07
09:14 am : S&P futures vs fair value: -1.3. Nasdaq futures vs fair value: -1.0.
08:59 am : S&P futures vs fair value: -2.3. Nasdaq futures vs fair value: -1.0. Futures shed a few points and now point to a slightly lower open. Fitch Ratings said it would affirm MBIA’s credit rating if its $1 billion offering is successful, according to Dow Jones, the stock is set to open higher. Dow Component Alcoa (AA) marks the start of earnings season with its report after the close. Crude (-0.2% to $96.12) is trading slightly lower ahead of the government’s weekly energy inventory report at 10:30 ET.
08:30 am : S&P futures vs fair value: +2.7. Nasdaq futures vs fair value: +5.8. Futures dip following a dividend reduction announcement, but are currently suggesting slightly higher open after recovering a bit. Bond insurer MBIA (MBI) announced it is reducing its quarterly dividend to $0.13 from $0.34. The struggling company also announced a $1 billion surplus note offering. Best Buy’s (BBY) CEO said he sees signs of a tougher retail climate, but does not see indications it is likely to be a really difficult one, according to Reuters. Retailers are down 9% in 2008.
08:00 am : S&P futures vs fair value: +2.8. Nasdaq futures vs fair value: +4.8. Futures trade indicates a slightly higher open following yesterday’s steep declines. Chemical maker DuPont (DD) raised its earning guidance for 2007 and 2008. As expected, Bear Stearns (BSC) chief executive James Cayne announced his resignation. The stock market is still shaky as investors continue to worry about the economy. Goldman Sachs said the U.S. is probably slipping into recession, according to Bloomberg.
06:20 am : S&P futures vs fair value: +4.9. Nasdaq futures vs fair value: +5.3.
06:19 am : FTSE...6288.80...-67.70...-1.1%. DAX...7811.16...-38.85...-0.5%.
06:19 am : Nikkei...14599.16...+70.49...+0.5%. Hang Seng...27615.85...+502.95...+1.9%.
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