AI
Tuesday, January 22, 2008 8:01:42 PM
Market Update 080122
http://biz.yahoo.com/mu/update.html
4:30 pm : It was anything but a normal day at the office for stock market participants who arrived Tuesday morning, cognizant that global equity markets had gotten creamed to start the week, that Bank of America (BAC 37.39, +1.42) reported a 95% decline in fourth quarter net income, and that the futures for the Dow Jones Industrial Average were signaling a loss of more than 500 points at the open.
Then the real excitement started.
At 08:20 ET it was announced that the Federal Open Market Committee (FOMC) approved a 75 basis point intermeeting cut in the fed funds rate to 3.50%. The Board of Governors also approved a 75 basis point cut in the discount rate to 4.00%.
The decision was stunning, both for its size and its timing, which came just eight days ahead of the regularly scheduled FOMC meeting.
The FOMC said it took this action "in view of a weakening of the economic outlook and increasing downside risks to growth." The statement added that, "Appreciable downside risks to growth remain." The latter statement fed the market's belief that there will be another substantive rate cut at the Jan. 29-30 FOMC meeting. Currently, the fed funds futures market is pricing in a 76% probability that the fed funds rate will be cut to 3.00% next week.
Following the FOMC's surprise announcement, the futures market pared a considerable portion of its early losses. It wasn't long before the futures for the major indices started backpedaling again as concerns about the aggressive nature of the Fed's easing, and what it signaled about economic conditions, caused unease for some traders. Subsequently, the stock market did indeed start the day on a sharply lower note.
At their lows of the morning, which were established shortly after the opening bell, the Dow, Nasdaq and S&P had dropped 459, 119 and 51 points, respectively. From that point on, they spent the remainder of the day in recovery mode, following the lead of the beaten-down, and rate-sensitive, financial (+2.2%) and consumer discretionary (+1.7%) sectors.
The financials greased the recovery effort as relative strength in that area after Bank of America's poor earnings report sparked short-covering activity. Notwithstanding its poor results, Bank of America helped get things going with an admission on its call that it expects to continue to raise its dividend and that it expects 2008 earnings per share to be well in excess of $4.00 versus $3.30 in 2007.
On a related note, Wachovia (WB 31.91, +1.11) said it had no plans to cut its dividend and that it has no need to cut its dividend.
Where the short-covering really registered, though, was in bond insurers MBIA (MBI 12.53, +3.98) and Ambac (ABK 7.97, +1.77). The former was helped by a positive article in Barron's while the latter helped its cause, after a horrid earnings report, with an admission that it is seeing a lot of interest for "strategic alternatives."
Overall, the S&P Retailing Index (+5.3%) turned in one of the best showings of the day as the rate cut spurred a flurry of short-covering and bottom-fishing interest in the depressed sector.
The major indices, however, still ended the day in the red, unable to make their way fully into positive territory after a striking rally try. Some late selling pressure worsened their official standing at the closing bell.
Not surprisingly, the volatility in the stock market produced a healthy bid in the Treasury market where the yield on the 10-year note dropped 15 basis points to 3.48%.DJ30 -128.11 NASDAQ -47.75 NQ100 -2.6% R2K -0.2% SP400 -0.5% SP500 -14.69 NASDAQ Dec/Adv/Vol 2034/979/3.18 bln NYSE Dec/Adv/Vol 1827/1367/2.56 bln
3:30 pm : Stocks attempted another recovery, and then ran into resistance near their session highs. The major indices are trading in negative territory, as they have for the entire session.
On the earnings front, Apple (AAPL 157.00, -4.33) and Texas Instruments (TXN 28.90, -0.57) are set to report after the close along with 17 other companies. Tomorrow morning, 44 companies are reporting, including ConocoPhillips (COP 71.36, -1.51), Motorola (MOT 12.04, -1.29), Pfizer (PFE 22.23, -0.27) and United Technologies (UTX 67.21, -0.84).DJ30 -127.79 NASDAQ -45.03 SP500 -15.61 NASDAQ Dec/Adv/Vol 2028/982/2.56 bln NYSE Dec/Adv/Vol 1911/1277/1.98 bln
3:00 pm : Stocks continue to vacillate within their afternoon trading range. Large cap tech names are underperforming this session.
85 of the 100 stocks in the Nasdaq 100 are trending lower. Apple (AAPL 156.95, -4.41) is the main laggard ahead of its earnings report after the close. Analysts expect Apple's earnings to increase 40% to $1.62 per share. Sears Holdings (SHLD 97.85, +8.42) is providing leadership on reports it is planning a reorganization.DJ30 -127.03 NASDAQ -45.02 NQ100 -2.3% SP500 -16.16 NASDAQ Dec/Adv/Vol 2067/949/2.38 bln NYSE Dec/Adv/Vol 2004/1166/1.86 bln
2:30 pm : Stocks continue to trade in the red, but are well above their session lows. Action has been choppy, but movement has been limited in afternoon trade when compared to this session's wide range. Meanwhile, Treasury bonds continue to make gains, sending the 10-year note's yield below 3.50%
Pimco's Bill Gross on CNBC said he expects the fed funds rate to be at 2.5% in six months. He said that President Bush's planned 1% fiscal stimulus package is just a drop in the bucket, and it would need to be 2% to 3% to prevent a recession.DJ30 -132.58 NASDAQ -45.52 SP500 -17.14 NASDAQ Dec/Adv/Vol 2015/980/2.24 bln NYSE Dec/Adv/Vol 2012/1163/1.73 bln
2:00 pm : Stocks are back on the retreat as the influential tech (-2.9%) and energy (-2.9%) sectors continue to show weakness. Despite the dip, the Dow has pared an impressive 321 points from its session low.
Moody's has affirmed Wachovia's (WB 31.69, +0.89) credit ratings, but with a negative outlook according to Reuters.
Even though the Fed cut rates by 75 basis points in an emergency session, traders are pricing in an 82% chance of a 50 basis point cut on the regularly scheduled Jan. 30 meeting. DJ30 -143.47 NASDAQ -46.15 SP500 -18.18 NASDAQ Dec/Adv/Vol 1944/1026/2.04 bln NYSE Dec/Adv/Vol 1926/1240/1.59 bln
1:30 pm : The major indices trade near their best levels of the session and then pullback. Meanwhile, the small-cap Russell 2000 Index is posting a modest gain.
Decliners outpace advancers by 3-to-2 on the NYSE and by 5-to-3 on the Nasdaq. On the NYSE, 782 stocks made a new 52-week low this session, compared to the seven that made a new high. On the Nasdaq, 873 stocks made a new 52-week low, compared to the three that made a new high. Trading volume is heavy.DJ30 -126.00 NASDAQ -41.56 R2K +0.6% SP500 -15.92 NASDAQ Dec/Adv/Vol 1853/1100/1.89 bln NYSE Dec/Adv/Vol 1859/1289/1.48 bln
1:00 pm : Stocks continue to trade in negative territory with the Dow modestly outperforming the other major indices.
Nine of the 30 Dow Jones Components are posting a gain. Retailer Home Depot (HD 28.00, +1.72) is providing leadership after the company was upgraded to Outperform from Market Perform at Bernstein, according to Bloomberg.com. Coca-Cola (KO 58.83, -1.91) is the main laggard.
Strikingly, the small-cap Russell 2000 Index is posting a small gain.DJ30 -102.10 NASDAQ -43.50 R2K +0.1% SP500 -14.17 NASDAQ Dec/Adv/Vol 2006/923/1.73 bln NYSE Dec/Adv/Vol 1996/1148/1.38 bln
12:30 pm : Trading has been choppy, with a wide session range. Stocks are trading modestly below their best levels of the session in heavy volume.
Fourth quarter 2007 earnings are now expected to decline 19.0%, lower than Jan. 1 estimated decline of 9.4%, according to Thomson Financial. The decline is due to larger than expected losses last week at Citigroup (C 24.46, +0.01) and Merrill Lynch (MER 53.84, +1.97). Earnings are expected to grow by 11.4% when not including financials.DJ30 -129.57 NASDAQ -47.72 SP500 -17.81 NASDAQ Dec/Adv/Vol 1896/1051/1.58 bln NYSE Dec/Adv/Vol 2035/1103/1.26 bln
12:00 pm : Stocks opened sharply lower in the wake of a global stock market sell-off. The major indices have managed to pare a good portion of their losses due to leadership from financials and retailers after the Fed cut interest rates before its scheduled meeting.
At midday, the Dow is down 175.01 points, off its best level of the session. The average is well off its low, though, as it was down 464 points shortly after the opening bell.
The selling pressure followed steep declines in overseas markets on fear of a U.S. recession. The Hong Kong Hang Seng, the Shanghai Composite and India plunged more than 10% in the last two sessions.
Before the open, the FOMC announced it is cutting the fed funds and discount rates by 75 basis points after an emergency unscheduled meeting. The fed funds rate now stands at 3.50% and the discount rate stands at 4.00%. It was the largest cut since 1984, and the Fed's first intermeeting cut since 2001.
The Fed decided to take action due to a "weakening economic outlook and increasing downside risks to growth." Of note, St. Louis Fed President William Poole dissented, as he did not believe current conditions justified action before the scheduled Jan. 30 meeting.
The market eventually warmed up to the rate cut, as financials (+1.9%) and retailers (+3.7%) rebounded into positive territory. The beaten down names are also seeing some short covering.
In earnings news, Bank of America (BAC 37.41, +1.44) reported fourth quarter net income dropped 95% to $0.05 per share. The bank also reported a $5.2 billion collateral debt obligation related write-down. The stock is trading higher, and helped lift the financial sector, after BofA's CEO said the company will continue to raise its dividend.
Eight sectors are lower, led by a 3.5% decline in utilities and a 3.2% decline in tech. Only financials and consumer discretionary (+0.7%) are in the green. DJ30 -175.01 NASDAQ -55.55 SP500 -23.50 NASDAQ Dec/Adv/Vol 2051/876/1.40 bln NYSE Dec/Adv/Vol 2081/1049/1.09 bln
11:30 am : Stocks climb to their best levels and then retreat a bit.
The financial sector (+3.3%) extends its gains. Wachovia's (WB 31.21, +0.41) CEO said the company has no plans to cut the dividend, and has no need to cut the dividend, according to Reuters.
Meanwhile, Retailers (+4.5%) continue to outperform. The utilities sector (-3.1%) is now the main laggard.DJ30 -145.43 NASDAQ -42.11 SP500 -16.23 NASDAQ Dec/Adv/Vol 1745/1142/1.18 bln NYSE Dec/Adv/Vol 2036/1079/885 mln
11:00 am : Stocks climb to their best levels of the session, but remain in the red.
Financials (+2.5%) have bounced into positive territory. The outperformance of the beaten down sector is being fueled by the 75 basis point rate cut and short covering. Thrifts & mortgages are providing leadership with a 4.8% advance. Office REITs are the main laggards with a 0.8% slide.
The 75 basis point rate cut has spurred some selling interest in the dollar. The dollar is down 1.20% against the euro and is down 0.40% against a basket of world currencies.DJ30 -150.79 NASDAQ -49.95 SP500 -19.48 NASDAQ Dec/Adv/Vol 2125/739/830 mln NYSE Dec/Adv/Vol 2335/746/695 mln
10:30 am : Stocks are trading at their best level of the session after a broad-based increase in buying interest. Losses remain substantial, but the major indices have made a significant recovery from their session lows.
The S&P 500 Retailing index is up 2.1%, which is aiding the consumer discretionary sector (+0.2%). Sears Holdings (SHLD 96.12, +6.69) is providing leadership after The Wall Street Journal reported the company is planning a shakeup.
Bond insurers MBIA (MBI 10.88, +2.33) and Ambac (ABK 7.68, +1.48) have made some large gains this morning. Ambac reported a larger than expected fourth quarter loss, but said its claims paying ability remains strong and it is evaluating strategic alternatives with a number of parties. MBIA was mentioned positively in Barron's.DJ30 -161.35 NASDAQ -53.55 SP500 -22.62 NASDAQ Dec/Adv/Vol 2387/437/646 mln NYSE Dec/Adv/Vol 2648/398/440 mln
10:00 am : Choppy action as the stock market is back on the retreat after paring a good portion of its losses as financials briefly bounced into the green.
The financial sector (-1.5%) is outperforming on a relative basis. Notably, Bank of America (BAC 35.22, -0.75) bounced off its lows after its CEO said the company will continue to raise its dividend. The bank missed its earnings expectations this morning and reported a $5.3 billion CDO-related write-down.
Telecom is the main laggard with a 5% drop, which follows its 5% decline last Friday.DJ30 -322.80 NASDAQ -72.72 SP500 -37.74 NASDAQ Dec/Adv/Vol 2464/244/315 mln
09:45 am : Stocks open sharply lower in the wake of a sell-off in global stock markets during the last two sessions. The Hong Kong Hang Seng Index dropped 8.7% today, and is down 13.7% in the past two sessions. The selling interest has been spurred by a fear of a U.S. slowdown.
The Federal Reserve cut the fed funds and discount rates by 75 basis points this morning prior to its regularly scheduled meeting on Jan. 30. The Fed decided to take action due to a "weakening economic outlook and increasing downside risks to growth." It is the largest cut since 1984, and the Fed's first inter meeting cut since 2001.
The rate cut has done little to lift the stock market in the early-going.DJ30 -368.65 NASDAQ -88.00 SP500 -44.25
09:16 am : S&P futures vs fair value: -56.1. Nasdaq futures vs fair value: -74.0.
09:00 am : S&P futures vs fair value: -60.8. Nasdaq futures vs fair value: -83.8. Futures give up the majority of their 75 basis point rate cut induced bounce. In overseas trading, the German Dax briefly hit positive territory on news of the cut, but has since slipped back into the red.
08:36 am : S&P futures vs fair value: -42.2. Nasdaq futures vs fair value: -47.0. Futures remain in the red, but have improved significantly on news that the Fed cut rates by 75 basis points prior to its scheduled Jan. 30 meeting. The fed funds rate now stands at 3.50% and the discount rate stands at 4.00%. The Fed decided to take action due to a “weakening economic outlook and increasing downside risks to growth.” Of note, St. Louis Fed President William Poole dissented, as he did not believe current conditions justified action before the Jan. 30 meeting.
08:20 am : S&P futures vs fair value: -41.4. Nasdaq futures vs fair value: -54.3. Futures get a bounce on news that the Fed unexpectedly cut rates by 75 basis points.
08:00 am : S&P futures vs fair value: -67.8. Nasdaq futures vs fair value: -86.0. Futures point to a sharply lower open in the wake of substantial losses in global stock markets. Hong Kong, the Shanghai Composite and India have plunged more than 10% in the last two sessions. The selling has been spurred by a fear of a United States economic slowdown. Meanwhile, the Treasury market is rallying in a flight-to-quality bid. In earnings news, Bank of America (BAC) missed expectations and reported a $5.3 billion CDO-related write-down.
06:47 am : S&P futures vs fair value: -57.3. Nasdaq futures vs fair value: -70.8.
06:47 am : FTSE...5586.70...+8.50...+0.2%. DAX...6729.26...-60.73...-0.9%.
06:47 am : Nikkei...12573.05...-752.89...-5.7%. Hang Seng...21757.63...-2061.23...-8.7%.
http://biz.yahoo.com/mu/update.html
4:30 pm : It was anything but a normal day at the office for stock market participants who arrived Tuesday morning, cognizant that global equity markets had gotten creamed to start the week, that Bank of America (BAC 37.39, +1.42) reported a 95% decline in fourth quarter net income, and that the futures for the Dow Jones Industrial Average were signaling a loss of more than 500 points at the open.
Then the real excitement started.
At 08:20 ET it was announced that the Federal Open Market Committee (FOMC) approved a 75 basis point intermeeting cut in the fed funds rate to 3.50%. The Board of Governors also approved a 75 basis point cut in the discount rate to 4.00%.
The decision was stunning, both for its size and its timing, which came just eight days ahead of the regularly scheduled FOMC meeting.
The FOMC said it took this action "in view of a weakening of the economic outlook and increasing downside risks to growth." The statement added that, "Appreciable downside risks to growth remain." The latter statement fed the market's belief that there will be another substantive rate cut at the Jan. 29-30 FOMC meeting. Currently, the fed funds futures market is pricing in a 76% probability that the fed funds rate will be cut to 3.00% next week.
Following the FOMC's surprise announcement, the futures market pared a considerable portion of its early losses. It wasn't long before the futures for the major indices started backpedaling again as concerns about the aggressive nature of the Fed's easing, and what it signaled about economic conditions, caused unease for some traders. Subsequently, the stock market did indeed start the day on a sharply lower note.
At their lows of the morning, which were established shortly after the opening bell, the Dow, Nasdaq and S&P had dropped 459, 119 and 51 points, respectively. From that point on, they spent the remainder of the day in recovery mode, following the lead of the beaten-down, and rate-sensitive, financial (+2.2%) and consumer discretionary (+1.7%) sectors.
The financials greased the recovery effort as relative strength in that area after Bank of America's poor earnings report sparked short-covering activity. Notwithstanding its poor results, Bank of America helped get things going with an admission on its call that it expects to continue to raise its dividend and that it expects 2008 earnings per share to be well in excess of $4.00 versus $3.30 in 2007.
On a related note, Wachovia (WB 31.91, +1.11) said it had no plans to cut its dividend and that it has no need to cut its dividend.
Where the short-covering really registered, though, was in bond insurers MBIA (MBI 12.53, +3.98) and Ambac (ABK 7.97, +1.77). The former was helped by a positive article in Barron's while the latter helped its cause, after a horrid earnings report, with an admission that it is seeing a lot of interest for "strategic alternatives."
Overall, the S&P Retailing Index (+5.3%) turned in one of the best showings of the day as the rate cut spurred a flurry of short-covering and bottom-fishing interest in the depressed sector.
The major indices, however, still ended the day in the red, unable to make their way fully into positive territory after a striking rally try. Some late selling pressure worsened their official standing at the closing bell.
Not surprisingly, the volatility in the stock market produced a healthy bid in the Treasury market where the yield on the 10-year note dropped 15 basis points to 3.48%.DJ30 -128.11 NASDAQ -47.75 NQ100 -2.6% R2K -0.2% SP400 -0.5% SP500 -14.69 NASDAQ Dec/Adv/Vol 2034/979/3.18 bln NYSE Dec/Adv/Vol 1827/1367/2.56 bln
3:30 pm : Stocks attempted another recovery, and then ran into resistance near their session highs. The major indices are trading in negative territory, as they have for the entire session.
On the earnings front, Apple (AAPL 157.00, -4.33) and Texas Instruments (TXN 28.90, -0.57) are set to report after the close along with 17 other companies. Tomorrow morning, 44 companies are reporting, including ConocoPhillips (COP 71.36, -1.51), Motorola (MOT 12.04, -1.29), Pfizer (PFE 22.23, -0.27) and United Technologies (UTX 67.21, -0.84).DJ30 -127.79 NASDAQ -45.03 SP500 -15.61 NASDAQ Dec/Adv/Vol 2028/982/2.56 bln NYSE Dec/Adv/Vol 1911/1277/1.98 bln
3:00 pm : Stocks continue to vacillate within their afternoon trading range. Large cap tech names are underperforming this session.
85 of the 100 stocks in the Nasdaq 100 are trending lower. Apple (AAPL 156.95, -4.41) is the main laggard ahead of its earnings report after the close. Analysts expect Apple's earnings to increase 40% to $1.62 per share. Sears Holdings (SHLD 97.85, +8.42) is providing leadership on reports it is planning a reorganization.DJ30 -127.03 NASDAQ -45.02 NQ100 -2.3% SP500 -16.16 NASDAQ Dec/Adv/Vol 2067/949/2.38 bln NYSE Dec/Adv/Vol 2004/1166/1.86 bln
2:30 pm : Stocks continue to trade in the red, but are well above their session lows. Action has been choppy, but movement has been limited in afternoon trade when compared to this session's wide range. Meanwhile, Treasury bonds continue to make gains, sending the 10-year note's yield below 3.50%
Pimco's Bill Gross on CNBC said he expects the fed funds rate to be at 2.5% in six months. He said that President Bush's planned 1% fiscal stimulus package is just a drop in the bucket, and it would need to be 2% to 3% to prevent a recession.DJ30 -132.58 NASDAQ -45.52 SP500 -17.14 NASDAQ Dec/Adv/Vol 2015/980/2.24 bln NYSE Dec/Adv/Vol 2012/1163/1.73 bln
2:00 pm : Stocks are back on the retreat as the influential tech (-2.9%) and energy (-2.9%) sectors continue to show weakness. Despite the dip, the Dow has pared an impressive 321 points from its session low.
Moody's has affirmed Wachovia's (WB 31.69, +0.89) credit ratings, but with a negative outlook according to Reuters.
Even though the Fed cut rates by 75 basis points in an emergency session, traders are pricing in an 82% chance of a 50 basis point cut on the regularly scheduled Jan. 30 meeting. DJ30 -143.47 NASDAQ -46.15 SP500 -18.18 NASDAQ Dec/Adv/Vol 1944/1026/2.04 bln NYSE Dec/Adv/Vol 1926/1240/1.59 bln
1:30 pm : The major indices trade near their best levels of the session and then pullback. Meanwhile, the small-cap Russell 2000 Index is posting a modest gain.
Decliners outpace advancers by 3-to-2 on the NYSE and by 5-to-3 on the Nasdaq. On the NYSE, 782 stocks made a new 52-week low this session, compared to the seven that made a new high. On the Nasdaq, 873 stocks made a new 52-week low, compared to the three that made a new high. Trading volume is heavy.DJ30 -126.00 NASDAQ -41.56 R2K +0.6% SP500 -15.92 NASDAQ Dec/Adv/Vol 1853/1100/1.89 bln NYSE Dec/Adv/Vol 1859/1289/1.48 bln
1:00 pm : Stocks continue to trade in negative territory with the Dow modestly outperforming the other major indices.
Nine of the 30 Dow Jones Components are posting a gain. Retailer Home Depot (HD 28.00, +1.72) is providing leadership after the company was upgraded to Outperform from Market Perform at Bernstein, according to Bloomberg.com. Coca-Cola (KO 58.83, -1.91) is the main laggard.
Strikingly, the small-cap Russell 2000 Index is posting a small gain.DJ30 -102.10 NASDAQ -43.50 R2K +0.1% SP500 -14.17 NASDAQ Dec/Adv/Vol 2006/923/1.73 bln NYSE Dec/Adv/Vol 1996/1148/1.38 bln
12:30 pm : Trading has been choppy, with a wide session range. Stocks are trading modestly below their best levels of the session in heavy volume.
Fourth quarter 2007 earnings are now expected to decline 19.0%, lower than Jan. 1 estimated decline of 9.4%, according to Thomson Financial. The decline is due to larger than expected losses last week at Citigroup (C 24.46, +0.01) and Merrill Lynch (MER 53.84, +1.97). Earnings are expected to grow by 11.4% when not including financials.DJ30 -129.57 NASDAQ -47.72 SP500 -17.81 NASDAQ Dec/Adv/Vol 1896/1051/1.58 bln NYSE Dec/Adv/Vol 2035/1103/1.26 bln
12:00 pm : Stocks opened sharply lower in the wake of a global stock market sell-off. The major indices have managed to pare a good portion of their losses due to leadership from financials and retailers after the Fed cut interest rates before its scheduled meeting.
At midday, the Dow is down 175.01 points, off its best level of the session. The average is well off its low, though, as it was down 464 points shortly after the opening bell.
The selling pressure followed steep declines in overseas markets on fear of a U.S. recession. The Hong Kong Hang Seng, the Shanghai Composite and India plunged more than 10% in the last two sessions.
Before the open, the FOMC announced it is cutting the fed funds and discount rates by 75 basis points after an emergency unscheduled meeting. The fed funds rate now stands at 3.50% and the discount rate stands at 4.00%. It was the largest cut since 1984, and the Fed's first intermeeting cut since 2001.
The Fed decided to take action due to a "weakening economic outlook and increasing downside risks to growth." Of note, St. Louis Fed President William Poole dissented, as he did not believe current conditions justified action before the scheduled Jan. 30 meeting.
The market eventually warmed up to the rate cut, as financials (+1.9%) and retailers (+3.7%) rebounded into positive territory. The beaten down names are also seeing some short covering.
In earnings news, Bank of America (BAC 37.41, +1.44) reported fourth quarter net income dropped 95% to $0.05 per share. The bank also reported a $5.2 billion collateral debt obligation related write-down. The stock is trading higher, and helped lift the financial sector, after BofA's CEO said the company will continue to raise its dividend.
Eight sectors are lower, led by a 3.5% decline in utilities and a 3.2% decline in tech. Only financials and consumer discretionary (+0.7%) are in the green. DJ30 -175.01 NASDAQ -55.55 SP500 -23.50 NASDAQ Dec/Adv/Vol 2051/876/1.40 bln NYSE Dec/Adv/Vol 2081/1049/1.09 bln
11:30 am : Stocks climb to their best levels and then retreat a bit.
The financial sector (+3.3%) extends its gains. Wachovia's (WB 31.21, +0.41) CEO said the company has no plans to cut the dividend, and has no need to cut the dividend, according to Reuters.
Meanwhile, Retailers (+4.5%) continue to outperform. The utilities sector (-3.1%) is now the main laggard.DJ30 -145.43 NASDAQ -42.11 SP500 -16.23 NASDAQ Dec/Adv/Vol 1745/1142/1.18 bln NYSE Dec/Adv/Vol 2036/1079/885 mln
11:00 am : Stocks climb to their best levels of the session, but remain in the red.
Financials (+2.5%) have bounced into positive territory. The outperformance of the beaten down sector is being fueled by the 75 basis point rate cut and short covering. Thrifts & mortgages are providing leadership with a 4.8% advance. Office REITs are the main laggards with a 0.8% slide.
The 75 basis point rate cut has spurred some selling interest in the dollar. The dollar is down 1.20% against the euro and is down 0.40% against a basket of world currencies.DJ30 -150.79 NASDAQ -49.95 SP500 -19.48 NASDAQ Dec/Adv/Vol 2125/739/830 mln NYSE Dec/Adv/Vol 2335/746/695 mln
10:30 am : Stocks are trading at their best level of the session after a broad-based increase in buying interest. Losses remain substantial, but the major indices have made a significant recovery from their session lows.
The S&P 500 Retailing index is up 2.1%, which is aiding the consumer discretionary sector (+0.2%). Sears Holdings (SHLD 96.12, +6.69) is providing leadership after The Wall Street Journal reported the company is planning a shakeup.
Bond insurers MBIA (MBI 10.88, +2.33) and Ambac (ABK 7.68, +1.48) have made some large gains this morning. Ambac reported a larger than expected fourth quarter loss, but said its claims paying ability remains strong and it is evaluating strategic alternatives with a number of parties. MBIA was mentioned positively in Barron's.DJ30 -161.35 NASDAQ -53.55 SP500 -22.62 NASDAQ Dec/Adv/Vol 2387/437/646 mln NYSE Dec/Adv/Vol 2648/398/440 mln
10:00 am : Choppy action as the stock market is back on the retreat after paring a good portion of its losses as financials briefly bounced into the green.
The financial sector (-1.5%) is outperforming on a relative basis. Notably, Bank of America (BAC 35.22, -0.75) bounced off its lows after its CEO said the company will continue to raise its dividend. The bank missed its earnings expectations this morning and reported a $5.3 billion CDO-related write-down.
Telecom is the main laggard with a 5% drop, which follows its 5% decline last Friday.DJ30 -322.80 NASDAQ -72.72 SP500 -37.74 NASDAQ Dec/Adv/Vol 2464/244/315 mln
09:45 am : Stocks open sharply lower in the wake of a sell-off in global stock markets during the last two sessions. The Hong Kong Hang Seng Index dropped 8.7% today, and is down 13.7% in the past two sessions. The selling interest has been spurred by a fear of a U.S. slowdown.
The Federal Reserve cut the fed funds and discount rates by 75 basis points this morning prior to its regularly scheduled meeting on Jan. 30. The Fed decided to take action due to a "weakening economic outlook and increasing downside risks to growth." It is the largest cut since 1984, and the Fed's first inter meeting cut since 2001.
The rate cut has done little to lift the stock market in the early-going.DJ30 -368.65 NASDAQ -88.00 SP500 -44.25
09:16 am : S&P futures vs fair value: -56.1. Nasdaq futures vs fair value: -74.0.
09:00 am : S&P futures vs fair value: -60.8. Nasdaq futures vs fair value: -83.8. Futures give up the majority of their 75 basis point rate cut induced bounce. In overseas trading, the German Dax briefly hit positive territory on news of the cut, but has since slipped back into the red.
08:36 am : S&P futures vs fair value: -42.2. Nasdaq futures vs fair value: -47.0. Futures remain in the red, but have improved significantly on news that the Fed cut rates by 75 basis points prior to its scheduled Jan. 30 meeting. The fed funds rate now stands at 3.50% and the discount rate stands at 4.00%. The Fed decided to take action due to a “weakening economic outlook and increasing downside risks to growth.” Of note, St. Louis Fed President William Poole dissented, as he did not believe current conditions justified action before the Jan. 30 meeting.
08:20 am : S&P futures vs fair value: -41.4. Nasdaq futures vs fair value: -54.3. Futures get a bounce on news that the Fed unexpectedly cut rates by 75 basis points.
08:00 am : S&P futures vs fair value: -67.8. Nasdaq futures vs fair value: -86.0. Futures point to a sharply lower open in the wake of substantial losses in global stock markets. Hong Kong, the Shanghai Composite and India have plunged more than 10% in the last two sessions. The selling has been spurred by a fear of a United States economic slowdown. Meanwhile, the Treasury market is rallying in a flight-to-quality bid. In earnings news, Bank of America (BAC) missed expectations and reported a $5.3 billion CDO-related write-down.
06:47 am : S&P futures vs fair value: -57.3. Nasdaq futures vs fair value: -70.8.
06:47 am : FTSE...5586.70...+8.50...+0.2%. DAX...6729.26...-60.73...-0.9%.
06:47 am : Nikkei...12573.05...-752.89...-5.7%. Hang Seng...21757.63...-2061.23...-8.7%.
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