AI
Monday, July 28, 2008 9:06:15 PM
Market Update 080728
http://biz.yahoo.com/mu/update.html
4:20 pm : Monday was not a good session for stock market bulls. Stocks tumbled 1.9%, settling at session lows, after the financial sector was unable to hold onto its opening gains, prompting a broad-based sell off. A 1.2% rise in oil prices compounded selling interest.
All ten of the economic sectors posted a loss on relatively light trading volume.
The financial sector got off to a good start, rising 1.6%, even though news ahead of the opening bell was somewhat negative. Over the weekend, the FDIC shut down two undercapitalized regional banks -- First National Bank of Nevada and First Heritage Bank -- marking the sixth and seventh failures this year. The banks' deposits were taken over by Mutual of Omaha. The closures did not come as a complete shock, as it is widely expected that more regional banks will fail, although the news certainly did not help bring buyers to the table.
The financial sector quickly reversed course as a sharp drop in shares of Merrill Lynch (MER 24.21, -3.31) sent the sector tumbling. There was no specific news item to account for the 12% drop in MER, although there were heightened concerns due to some increased options buying.
In late afternoon, Treasury Secretary Paulson and four of the U.S. largest banks announced support for covered bonds as an instrument to improve mortgage financing oportunities. Covered bonds are similar to traditional asset-backed securities, but would remain on the issuers' balance sheet. The announcement did little to please investors, with the financial sector ending the session down 4.5%. The sector is down 11.5% in the last three sessions, but is still up 18.5% from its July 15 52-week low.
The consumer discretionary sector fell 2.5%, as the 1.2% rise in crude oil prices weighed on oil-sensitive names. Oil advanced on reports of unrest in Nigeria. Conversely, the energy sector outperformed on a relative basis with a 0.5% loss, although the sector fell from a gain of 1.6% as the broader market slipped.
In earnings news, telecom (-2.3%) underperformed after investors soured on Verizon Communication's (VZ 33.57, -0.88) quarterly results. The company reported slightly higher-than-expected earnings due to solid wireless growth. Wall Street was concerned with the slower growth rate of the company's FiOS service.
Kraft Foods (KFT 30.87, +1.49) posted a solid gain after the company topped Wall Street's estimate with a 16% increase in second quarter earnings per share. The company was able to offset soaring commodity costs by passing increased prices on to consumers. Conversely, Tyson Foods (TSN 15.12, -1.11) was not able to pass along its increased input prices, resulting in a 90% drop in earnings per share, which fell short of expectations.
Amgen (AMGN 60.48, +6.56) was the best performing stock on Monday. Wall Street was pleased with encouraging results related to the trial of Amgen's osteoporosis drug.
In deal news, private equity firm Kohlberg Kravis Roberts is going public through a takeover of its struggling European affiliate KKR Private Equity. The Wall Street Journal reports that the company, which will trade on the NYSE as KKR, may be valued between $12 billion and $15 billion.
As stocks struggled, Treasuries rallied. The 10-year note rose 21 ticks, sending its yield to 4.0%. DJ30 -239.61 NASDAQ -46.31 NQ100 -2.4% R2K -2.0% SP400 -1.2% SP500 -23.39 NASDAQ Adv/Vol/Dec 690/1.96 bln/2126 NYSE Adv/Vol/Dec 857/1.17 bln/2289
3:30 pm : The stock market trades slightly above its recently reached low, as a lack of leadership is preventing a substantial recovery effort.
Tuesday is set to be a busy session with the release of the latest consumer confidence reading and a barrage of earnings reports. Amgen (AMGN 60.22, +6.30), Mosaic (MOS 123.15, +1.10) and Colgate-Palmolive (CL 68.78, -0.42) are a few of the more widely held names.DJ30 -186.68 NASDAQ -39.77 SP500 -16.84 NASDAQ Adv/Vol/Dec 722/1.58 bln/2069 NYSE Adv/Vol/Dec 928/862 mln/2201
3:00 pm : The stock market traders near its recently reached session low.
Four major financial firms issued a joint statement announcing their support for two recent regulatory actions taken by the FDIC and U.S. Treasury Department to promote the development of the U.S. covered bond market. The supporting financial firms include Bank of America (BAC 28.87, +0.72), Citigroup (C 17.69, -1.16), JPMorgan Chase (JPM 38.19, -1.33) and Wells Fargo (WFC 28.27, -0.82).
A covered bond, like asset-backed securities, are based on an underlying asset. However, unlike asset-backed securities, the covered bond would remain on the issuers' balance sheet.
Treasury Secretary Paulson believes covered bonds have the potential to increase mortgage financing, improve underwriting standards and strengthen U.S. financial institutions.
The market enjoyed a brief upturn on the news, but gains were quickly given up.DJ30 -188.97 NASDAQ -39.16 SP500 -16.93 NASDAQ Adv/Vol/Dec 680/1.41 bln/2088 NYSE Adv/Vol/Dec 871/770 mln/2232
2:30 pm : The major indices establish minor new session lows. The selling interest is broad-based, with notable weakness in financials (-2.6%), telecom (-2.3%) and consumer discretionary (-2.3%).
Large cap tech is also under pressure, with the Nasdaq 100 falling 2.1%. The main laggards include, Apple (AAPL 155.50, -6.54), Google (GOOG 476.60, -15.38), Microsoft (MSFT 25.52, -0.65) and Research In Motion (RIMM 114.39, -3.04).
The energy sector (+0.5%) stands alone in positive territory, thanks to a 1.2% rise in crude oil prices.DJ30 -200.04 NASDAQ -41.84 SP500 -17.57 NASDAQ Adv/Vol/Dec 692/1.29 bln/2060 NYSE Adv/Vol/Dec 889/705 mln/2202
2:00 pm : Stocks have made a bit of an upturn after taking out a fresh session low. Still, losses in each of the major indices remains considerable.
The downturn in the Dow is the most significant. Alcoa (AA 32.14, +0.33) is the only one of its components trading with a gain.
The session's pessimistic tone has pushed participants toward Treasuries. The benchmark 10-year Note is up 22 ticks, pushing its yield toward a session low.DJ30 -184.74 NASDAQ -32.22 SP500 -15.42 NASDAQ Adv/Vol/Dec 757/1.18 bln/1975 NYSE Adv/Vol/Dec 928/648 mln/2146
1:30 pm : The stock market stabilized near its recently established session low. The only sectors that remain in positive territory -- energy (+0.2%) and utilities (+0.1%) -- are struggling to maintain a gain.
Steel stocks are a pocket of strength this session, rising 2.9%. Before the stock market open Credit Suisse gave a positive outlook on future steel prices, citing strength in supply and demand fundamentals.DJ30 -181.48 NASDAQ -30.95 SP500 -14.38 NASDAQ Adv/Vol/Dec 764/1.06 bln/1939 NYSE Adv/Vol/Dec 972/590 mln/2089
1:00 pm : The stock market establishes a new intraday low, down more than 1%.
The financial sector (-2.3%) extends its decline, with 74% of its components posting a loss. The main laggards are AIG (AIG 25.33, -1.91 ), Citigroup (C 17.82, -1.03) and Bank of America (BAC 28.79, -0.79).
Fannie Mae (FNM 11.49, -0.06) and Freddie Mac (FRE 8.44, +0.17) are avoiding a sharp decline, although they are well off their session highs. Last Saturday, the Senate passed a housing relief bill, which includes support for Fannie and Freddie.
Meanwhile, the telecom sector (-1.5%) is trading at a fresh 52-week low. The sector is now down 29.6% from its 52-week high.DJ30 -187.75 NASDAQ -32.13 SP500 -14.93 NASDAQ Adv/Vol/Dec 793/963 mln/1889 NYSE Adv/Vol/Dec 987/536 mln/2041
12:30 pm : The stock market is unable to gain any upward momentum as two of the most heavily weighted sectors -- financials (-1.6%) and tech (-1.2%) -- post large declines. There is an overall lack of leadership, with 68% of S&P 500 stocks posting a loss.
Federal Reserve Governor Frederic Mishkin said commodity prices have driven inflation above a level that is consistent with price stability. Mishkin said the Federal Reserve should adopt an inflation target, adding that a long run level of 2% or a bit less is low enough to for everyday decisions of households and businesses while also alleviating risks of deflation.DJ30 -127.15 NASDAQ -21.23 SP500 -8.31 NASDAQ Adv/Vol/Dec 864/863 mln/1797 NYSE Adv/Vol/Dec 1125/482 mln/1895
12:05 pm : At midday, stocks are trading with substantial losses near session lows as financials come under selling pressure and oil prices (+0.8% to $124.12) regain some lost ground. Overall it was a slow news day with only handful of earnings reports and no economic data. The weakness is mostly broad-based, with eight of the ten sectors posting a loss.
The financial sector got off to a good start, rising 1.6%, even though news this morning was not great. Over the weekend, the FDIC shut down two under capitalized regional banks -- First National Bank of Nevada and First Heritage Bank -- marking the sixth and seventh failure this year. The banks' deposits were taken over by Mutual of Omaha. The closures do not come as a complete shock, as it is widely expected that more regional banks will fail, although the news certainly does not help bring buyers to the table.
The financial sector is down 1.5% at midday, as a sharp drop in shares of Merrill Lynch (MER 25.07, -2.47) sent the sector tumbling. There is no specific news item to account for the drop in MER, although there are heightened concerns due to some increased options buying.
The consumer discretionary sector is posting a substantial loss of 1.7%, as the 0.8% rise crude oil prices weighs on the oil-sensitive names. Conversely, the energy sector is leading the way with a 0.8% gain.
In earnings news, telecom (-1.1%) is a laggard as investors sour to Verizon Communication's (VZ 33.78, -0.67) earnings. The company reported slightly higher-than-expected earnings due to solid wireless growth, although Wall Street is concerned with the company's flagging land-line business and DSL service.
Kraft Foods (KFT 30.78, +1.40) is sporting a solid gain after the company topped Wall Street's estimate with a 16% increase in second quarter earnings per share. The company was able to offset soaring commodity costs by passing increased prices on to consumers. Conversely, Tyson Foods (TSN 15.35, -0.88) was not able to pass along price increases. Tyson reported a 90% drop in earnings per share, which fell short of expectations.
Amgen (AMGN 60.32, +6.40) is the best performing stock this session. Wall Street is pleased with the biotech firm's positive osteoporosis drug trial results.
In deal news, private equity firm Kohlberg Kravis Roberts is going public through a takeover of its struggling European affiliate KKR Private Equity. The Wall Street Journal reports the company, which will trade on the NYSE as KKR, may be valued between $12 billion and $15 billion.
As stocks falter, Treasuries rally. The 10-year note is up 22 ticks, sending its yield to around 4.0%. DJ30 -128.07 NASDAQ -20.60 SP500 -8.29 NASDAQ Adv/Vol/Dec 879/773 mln/1771 NYSE Adv/Vol/Dec 1122/427 mln/1881
11:30 am : Buyers are not showing much interest as the stock market falls to session lows. At the same time, crude prices rebound, now up 1.0% to $124.43
Only three sectors are in positive territory -- energy (+1.6%), materials (+0.3%) and utilities (+0.8%).
The financial sector continues to stumble, extending its decline to -2.0%. Consumer discretionary stocks (-1.8%) are under pressure as crude prices rebound.
Treasuries are rallying, with the 10-year note yielding just below 4% after rising 25 ticks.DJ30 -111.38 NASDAQ -20.68 SP500 -6.79 NASDAQ Adv/Vol/Dec 836/647 mln/1761 NYSE Adv/Vol/Dec 1136/362 mln/1828
11:05 am : The stock market remains in the red, with notable weakness in blue chip names as the Dow (-0.7%) underperforms its counterparts. AIG (AIG 25.89, -1.35) and 3M (MMM 70.05, -0.90) are the worst-performing Dow components.
Merrill Lynch (MER 26.04, -1.48) is a notable laggard within the financial sector, falling as much as 8.2% on no specific news item. MER is currently down 5.4%. Not all Wall Street firms are under heavy pressure, Goldman Sachs (GS 178.43, -0.23) and JPMorgan Chase (JPM 39.57, +0.05) are both holding near the unchanged mark. The financial sector is trading with a loss of 1.1%, after rising as much as 1.6% in the early-going.
Shares of Motorola (MOT 7.12, -0.13) are garnering some attention on reports that Motorola is going to reorganize its second largest business. According to The Wall Street Journal, the struggling communication equipment company is expected to split its home and networks mobility business unit into three distinct businesses, which may make it easier for Motorola to sell the businesses in the future.
As the rest of the market slips, energy stocks (+0.9%) get a decent bid, although oil is only up a modest 0.2%.DJ30 -82.64 NASDAQ -10.74 SP500 -3.49 NASDAQ Adv/Vol/Dec 874/523 mln/1641 NYSE Adv/Vol/Dec 1292/297 mln/1617
10:30 am : The stock market trades with a modest loss as the financial sector (-0.7%) falls into the red. There is some weakness in banks, with regional banks sliding 1.4% and diversified banks shedding 0.8%.
Meanwhile, Treasuries are enjoying some buying interest. The 10-year note is up 20 ticks, sending its yield down to 4.01%.
In deal news, The Wall Street Journal reports private equity firm KKR is going public, which will enable KKR to buy its struggling European affiliate KKR Private Equity. KKR is expected to fetch between $12 billion and $15 billion.DJ30 -47.30 NASDAQ -4.61 SP500 -0.78 NASDAQ Adv/Vol/Dec 903/391 mln/1545 NYSE Adv/Vol/Dec 1415/222 mln/1413
10:00 am : The stock market climbs into the green and then retreats back into the negative territory. The financial sector (unch) dips off its 1.7% opening gain, although thrifts and mortgages stocks (+3.7%) -- which includes GSEs Fannie Mae (FNM 12.19, +0.64) and Freddie Mac (FRE 8.75, +0.48) -- are still enjoying some buying interest.
Telecom (-0.4%) is a laggard after investors show disappointment with Verizon's (VZ 33.88, -0.57) quarterly results, although the telecom giant did top its earnings estimates.
Amgen (AMGN 61.83, +7.91) is the best performing stock this session. Wall Street is pleased with the biotech firm's positive osteoporosis drug trial results.DJ30 -35.49 NASDAQ -6.76 SP500 -0.51 NASDAQ Adv/Vol/Dec 921/241 mln/1412 NYSE Adv/Vol/Dec 1383/138 mln/1333
09:40 am : The stock market opens on a modestly lower note as continued economic concerns and worries of the sustainability of the financial sector's rebound offset several better-than-expected earnings reports. Then an easing in crude prices (unchanged at $123.25 after being up 1.6%) helps the S&P 500 recover to the unchanged mark, and the Nasdaq find positive ground.
Verizon (VZ 34.01, -0.44) reported earnings of $0.67 per share, which topped estimates by two cents. The telecom giant is benefiting from strong wireless sales. Kraft Foods (KFT 30.30, +0.92) reported quarterly earnings that were 16% better than the previous year and the consensus estimate after the company was able to offset rising input costs with price hikes.
In other news, the FDIC shut down two undercapitalized regional banks -- First Nation Bank and First Heritage Bank. The deposits were taken over by Mutual of Omaha. Financials up 1.3% in the early-going as investors shrug off the news.DJ30 -24.75 NASDAQ +2.16 SP500 -0.43
09:15 am : S&P futures vs fair value: -4.0. Nasdaq futures vs fair value: -9.5.
09:01 am : S&P futures vs fair value: -3.7. Nasdaq futures vs fair value: -10.0. A modestly lower open is expected, as concerns about a slowing global economy and doubts of the sustainability of the financial sector rally keeps buying interest in check. Wrigley (WWY) reported earnings of $0.74 per share, which is six cents better the the average analyst estimate. In May, Mars Inc. announced plans to buy Wrigley for $23 billion.
08:35 am : S&P futures vs fair value: -3.7. Nasdaq futures vs fair value: -7.2. Futures continue to indicate a lower open as crude climbs 0.9% to $124.35 per barrel. Toyota (TM) lowered its 2008 worldwide sales target to 9.5 million vehicles from 9.85 million vehicles, with weakness in North America. According to the Wall Street Journal, Toyota sold 9.37 million cars in 2007.
08:05 am : S&P futures vs fair value: -3.8. Nasdaq futures vs fair value: -7.2. Futures suggest a lower start to the trading week. Dow component Verizon (VZ) reported earnings of $0.67 per share, which is two cents better than expectations. Meanwhile, Kraft (KFT) reported second quarter earnings that were well above estimates and issued upside 2008 earnings guidance. Private equity firm KKR plans to sell itself to the public, partly to rescue its struggling European unit, according to the Wall Street Journal. Two banks were shut down by the FDIC over the weekend, including First Nation Bank and First Heritage Bank. The deposits were taken over by Mutual of Omaha.
06:17 am : S&P futures vs fair value: -7.8. Nasdaq futures vs fair value: -17.0.
06:16 am : FTSE...5336.00...-16.60...-0.3%. DAX...6370.52...-66.19...-1.0%.
06:16 am : Nikkei...13353.78...+19.02...+0.1%. Hang Seng...22687.21...-53.50...-0.2%.
My posting is for my own entertainment, do your own DD before pushing your buy/call button
http://biz.yahoo.com/mu/update.html
4:20 pm : Monday was not a good session for stock market bulls. Stocks tumbled 1.9%, settling at session lows, after the financial sector was unable to hold onto its opening gains, prompting a broad-based sell off. A 1.2% rise in oil prices compounded selling interest.
All ten of the economic sectors posted a loss on relatively light trading volume.
The financial sector got off to a good start, rising 1.6%, even though news ahead of the opening bell was somewhat negative. Over the weekend, the FDIC shut down two undercapitalized regional banks -- First National Bank of Nevada and First Heritage Bank -- marking the sixth and seventh failures this year. The banks' deposits were taken over by Mutual of Omaha. The closures did not come as a complete shock, as it is widely expected that more regional banks will fail, although the news certainly did not help bring buyers to the table.
The financial sector quickly reversed course as a sharp drop in shares of Merrill Lynch (MER 24.21, -3.31) sent the sector tumbling. There was no specific news item to account for the 12% drop in MER, although there were heightened concerns due to some increased options buying.
In late afternoon, Treasury Secretary Paulson and four of the U.S. largest banks announced support for covered bonds as an instrument to improve mortgage financing oportunities. Covered bonds are similar to traditional asset-backed securities, but would remain on the issuers' balance sheet. The announcement did little to please investors, with the financial sector ending the session down 4.5%. The sector is down 11.5% in the last three sessions, but is still up 18.5% from its July 15 52-week low.
The consumer discretionary sector fell 2.5%, as the 1.2% rise in crude oil prices weighed on oil-sensitive names. Oil advanced on reports of unrest in Nigeria. Conversely, the energy sector outperformed on a relative basis with a 0.5% loss, although the sector fell from a gain of 1.6% as the broader market slipped.
In earnings news, telecom (-2.3%) underperformed after investors soured on Verizon Communication's (VZ 33.57, -0.88) quarterly results. The company reported slightly higher-than-expected earnings due to solid wireless growth. Wall Street was concerned with the slower growth rate of the company's FiOS service.
Kraft Foods (KFT 30.87, +1.49) posted a solid gain after the company topped Wall Street's estimate with a 16% increase in second quarter earnings per share. The company was able to offset soaring commodity costs by passing increased prices on to consumers. Conversely, Tyson Foods (TSN 15.12, -1.11) was not able to pass along its increased input prices, resulting in a 90% drop in earnings per share, which fell short of expectations.
Amgen (AMGN 60.48, +6.56) was the best performing stock on Monday. Wall Street was pleased with encouraging results related to the trial of Amgen's osteoporosis drug.
In deal news, private equity firm Kohlberg Kravis Roberts is going public through a takeover of its struggling European affiliate KKR Private Equity. The Wall Street Journal reports that the company, which will trade on the NYSE as KKR, may be valued between $12 billion and $15 billion.
As stocks struggled, Treasuries rallied. The 10-year note rose 21 ticks, sending its yield to 4.0%. DJ30 -239.61 NASDAQ -46.31 NQ100 -2.4% R2K -2.0% SP400 -1.2% SP500 -23.39 NASDAQ Adv/Vol/Dec 690/1.96 bln/2126 NYSE Adv/Vol/Dec 857/1.17 bln/2289
3:30 pm : The stock market trades slightly above its recently reached low, as a lack of leadership is preventing a substantial recovery effort.
Tuesday is set to be a busy session with the release of the latest consumer confidence reading and a barrage of earnings reports. Amgen (AMGN 60.22, +6.30), Mosaic (MOS 123.15, +1.10) and Colgate-Palmolive (CL 68.78, -0.42) are a few of the more widely held names.DJ30 -186.68 NASDAQ -39.77 SP500 -16.84 NASDAQ Adv/Vol/Dec 722/1.58 bln/2069 NYSE Adv/Vol/Dec 928/862 mln/2201
3:00 pm : The stock market traders near its recently reached session low.
Four major financial firms issued a joint statement announcing their support for two recent regulatory actions taken by the FDIC and U.S. Treasury Department to promote the development of the U.S. covered bond market. The supporting financial firms include Bank of America (BAC 28.87, +0.72), Citigroup (C 17.69, -1.16), JPMorgan Chase (JPM 38.19, -1.33) and Wells Fargo (WFC 28.27, -0.82).
A covered bond, like asset-backed securities, are based on an underlying asset. However, unlike asset-backed securities, the covered bond would remain on the issuers' balance sheet.
Treasury Secretary Paulson believes covered bonds have the potential to increase mortgage financing, improve underwriting standards and strengthen U.S. financial institutions.
The market enjoyed a brief upturn on the news, but gains were quickly given up.DJ30 -188.97 NASDAQ -39.16 SP500 -16.93 NASDAQ Adv/Vol/Dec 680/1.41 bln/2088 NYSE Adv/Vol/Dec 871/770 mln/2232
2:30 pm : The major indices establish minor new session lows. The selling interest is broad-based, with notable weakness in financials (-2.6%), telecom (-2.3%) and consumer discretionary (-2.3%).
Large cap tech is also under pressure, with the Nasdaq 100 falling 2.1%. The main laggards include, Apple (AAPL 155.50, -6.54), Google (GOOG 476.60, -15.38), Microsoft (MSFT 25.52, -0.65) and Research In Motion (RIMM 114.39, -3.04).
The energy sector (+0.5%) stands alone in positive territory, thanks to a 1.2% rise in crude oil prices.DJ30 -200.04 NASDAQ -41.84 SP500 -17.57 NASDAQ Adv/Vol/Dec 692/1.29 bln/2060 NYSE Adv/Vol/Dec 889/705 mln/2202
2:00 pm : Stocks have made a bit of an upturn after taking out a fresh session low. Still, losses in each of the major indices remains considerable.
The downturn in the Dow is the most significant. Alcoa (AA 32.14, +0.33) is the only one of its components trading with a gain.
The session's pessimistic tone has pushed participants toward Treasuries. The benchmark 10-year Note is up 22 ticks, pushing its yield toward a session low.DJ30 -184.74 NASDAQ -32.22 SP500 -15.42 NASDAQ Adv/Vol/Dec 757/1.18 bln/1975 NYSE Adv/Vol/Dec 928/648 mln/2146
1:30 pm : The stock market stabilized near its recently established session low. The only sectors that remain in positive territory -- energy (+0.2%) and utilities (+0.1%) -- are struggling to maintain a gain.
Steel stocks are a pocket of strength this session, rising 2.9%. Before the stock market open Credit Suisse gave a positive outlook on future steel prices, citing strength in supply and demand fundamentals.DJ30 -181.48 NASDAQ -30.95 SP500 -14.38 NASDAQ Adv/Vol/Dec 764/1.06 bln/1939 NYSE Adv/Vol/Dec 972/590 mln/2089
1:00 pm : The stock market establishes a new intraday low, down more than 1%.
The financial sector (-2.3%) extends its decline, with 74% of its components posting a loss. The main laggards are AIG (AIG 25.33, -1.91 ), Citigroup (C 17.82, -1.03) and Bank of America (BAC 28.79, -0.79).
Fannie Mae (FNM 11.49, -0.06) and Freddie Mac (FRE 8.44, +0.17) are avoiding a sharp decline, although they are well off their session highs. Last Saturday, the Senate passed a housing relief bill, which includes support for Fannie and Freddie.
Meanwhile, the telecom sector (-1.5%) is trading at a fresh 52-week low. The sector is now down 29.6% from its 52-week high.DJ30 -187.75 NASDAQ -32.13 SP500 -14.93 NASDAQ Adv/Vol/Dec 793/963 mln/1889 NYSE Adv/Vol/Dec 987/536 mln/2041
12:30 pm : The stock market is unable to gain any upward momentum as two of the most heavily weighted sectors -- financials (-1.6%) and tech (-1.2%) -- post large declines. There is an overall lack of leadership, with 68% of S&P 500 stocks posting a loss.
Federal Reserve Governor Frederic Mishkin said commodity prices have driven inflation above a level that is consistent with price stability. Mishkin said the Federal Reserve should adopt an inflation target, adding that a long run level of 2% or a bit less is low enough to for everyday decisions of households and businesses while also alleviating risks of deflation.DJ30 -127.15 NASDAQ -21.23 SP500 -8.31 NASDAQ Adv/Vol/Dec 864/863 mln/1797 NYSE Adv/Vol/Dec 1125/482 mln/1895
12:05 pm : At midday, stocks are trading with substantial losses near session lows as financials come under selling pressure and oil prices (+0.8% to $124.12) regain some lost ground. Overall it was a slow news day with only handful of earnings reports and no economic data. The weakness is mostly broad-based, with eight of the ten sectors posting a loss.
The financial sector got off to a good start, rising 1.6%, even though news this morning was not great. Over the weekend, the FDIC shut down two under capitalized regional banks -- First National Bank of Nevada and First Heritage Bank -- marking the sixth and seventh failure this year. The banks' deposits were taken over by Mutual of Omaha. The closures do not come as a complete shock, as it is widely expected that more regional banks will fail, although the news certainly does not help bring buyers to the table.
The financial sector is down 1.5% at midday, as a sharp drop in shares of Merrill Lynch (MER 25.07, -2.47) sent the sector tumbling. There is no specific news item to account for the drop in MER, although there are heightened concerns due to some increased options buying.
The consumer discretionary sector is posting a substantial loss of 1.7%, as the 0.8% rise crude oil prices weighs on the oil-sensitive names. Conversely, the energy sector is leading the way with a 0.8% gain.
In earnings news, telecom (-1.1%) is a laggard as investors sour to Verizon Communication's (VZ 33.78, -0.67) earnings. The company reported slightly higher-than-expected earnings due to solid wireless growth, although Wall Street is concerned with the company's flagging land-line business and DSL service.
Kraft Foods (KFT 30.78, +1.40) is sporting a solid gain after the company topped Wall Street's estimate with a 16% increase in second quarter earnings per share. The company was able to offset soaring commodity costs by passing increased prices on to consumers. Conversely, Tyson Foods (TSN 15.35, -0.88) was not able to pass along price increases. Tyson reported a 90% drop in earnings per share, which fell short of expectations.
Amgen (AMGN 60.32, +6.40) is the best performing stock this session. Wall Street is pleased with the biotech firm's positive osteoporosis drug trial results.
In deal news, private equity firm Kohlberg Kravis Roberts is going public through a takeover of its struggling European affiliate KKR Private Equity. The Wall Street Journal reports the company, which will trade on the NYSE as KKR, may be valued between $12 billion and $15 billion.
As stocks falter, Treasuries rally. The 10-year note is up 22 ticks, sending its yield to around 4.0%. DJ30 -128.07 NASDAQ -20.60 SP500 -8.29 NASDAQ Adv/Vol/Dec 879/773 mln/1771 NYSE Adv/Vol/Dec 1122/427 mln/1881
11:30 am : Buyers are not showing much interest as the stock market falls to session lows. At the same time, crude prices rebound, now up 1.0% to $124.43
Only three sectors are in positive territory -- energy (+1.6%), materials (+0.3%) and utilities (+0.8%).
The financial sector continues to stumble, extending its decline to -2.0%. Consumer discretionary stocks (-1.8%) are under pressure as crude prices rebound.
Treasuries are rallying, with the 10-year note yielding just below 4% after rising 25 ticks.DJ30 -111.38 NASDAQ -20.68 SP500 -6.79 NASDAQ Adv/Vol/Dec 836/647 mln/1761 NYSE Adv/Vol/Dec 1136/362 mln/1828
11:05 am : The stock market remains in the red, with notable weakness in blue chip names as the Dow (-0.7%) underperforms its counterparts. AIG (AIG 25.89, -1.35) and 3M (MMM 70.05, -0.90) are the worst-performing Dow components.
Merrill Lynch (MER 26.04, -1.48) is a notable laggard within the financial sector, falling as much as 8.2% on no specific news item. MER is currently down 5.4%. Not all Wall Street firms are under heavy pressure, Goldman Sachs (GS 178.43, -0.23) and JPMorgan Chase (JPM 39.57, +0.05) are both holding near the unchanged mark. The financial sector is trading with a loss of 1.1%, after rising as much as 1.6% in the early-going.
Shares of Motorola (MOT 7.12, -0.13) are garnering some attention on reports that Motorola is going to reorganize its second largest business. According to The Wall Street Journal, the struggling communication equipment company is expected to split its home and networks mobility business unit into three distinct businesses, which may make it easier for Motorola to sell the businesses in the future.
As the rest of the market slips, energy stocks (+0.9%) get a decent bid, although oil is only up a modest 0.2%.DJ30 -82.64 NASDAQ -10.74 SP500 -3.49 NASDAQ Adv/Vol/Dec 874/523 mln/1641 NYSE Adv/Vol/Dec 1292/297 mln/1617
10:30 am : The stock market trades with a modest loss as the financial sector (-0.7%) falls into the red. There is some weakness in banks, with regional banks sliding 1.4% and diversified banks shedding 0.8%.
Meanwhile, Treasuries are enjoying some buying interest. The 10-year note is up 20 ticks, sending its yield down to 4.01%.
In deal news, The Wall Street Journal reports private equity firm KKR is going public, which will enable KKR to buy its struggling European affiliate KKR Private Equity. KKR is expected to fetch between $12 billion and $15 billion.DJ30 -47.30 NASDAQ -4.61 SP500 -0.78 NASDAQ Adv/Vol/Dec 903/391 mln/1545 NYSE Adv/Vol/Dec 1415/222 mln/1413
10:00 am : The stock market climbs into the green and then retreats back into the negative territory. The financial sector (unch) dips off its 1.7% opening gain, although thrifts and mortgages stocks (+3.7%) -- which includes GSEs Fannie Mae (FNM 12.19, +0.64) and Freddie Mac (FRE 8.75, +0.48) -- are still enjoying some buying interest.
Telecom (-0.4%) is a laggard after investors show disappointment with Verizon's (VZ 33.88, -0.57) quarterly results, although the telecom giant did top its earnings estimates.
Amgen (AMGN 61.83, +7.91) is the best performing stock this session. Wall Street is pleased with the biotech firm's positive osteoporosis drug trial results.DJ30 -35.49 NASDAQ -6.76 SP500 -0.51 NASDAQ Adv/Vol/Dec 921/241 mln/1412 NYSE Adv/Vol/Dec 1383/138 mln/1333
09:40 am : The stock market opens on a modestly lower note as continued economic concerns and worries of the sustainability of the financial sector's rebound offset several better-than-expected earnings reports. Then an easing in crude prices (unchanged at $123.25 after being up 1.6%) helps the S&P 500 recover to the unchanged mark, and the Nasdaq find positive ground.
Verizon (VZ 34.01, -0.44) reported earnings of $0.67 per share, which topped estimates by two cents. The telecom giant is benefiting from strong wireless sales. Kraft Foods (KFT 30.30, +0.92) reported quarterly earnings that were 16% better than the previous year and the consensus estimate after the company was able to offset rising input costs with price hikes.
In other news, the FDIC shut down two undercapitalized regional banks -- First Nation Bank and First Heritage Bank. The deposits were taken over by Mutual of Omaha. Financials up 1.3% in the early-going as investors shrug off the news.DJ30 -24.75 NASDAQ +2.16 SP500 -0.43
09:15 am : S&P futures vs fair value: -4.0. Nasdaq futures vs fair value: -9.5.
09:01 am : S&P futures vs fair value: -3.7. Nasdaq futures vs fair value: -10.0. A modestly lower open is expected, as concerns about a slowing global economy and doubts of the sustainability of the financial sector rally keeps buying interest in check. Wrigley (WWY) reported earnings of $0.74 per share, which is six cents better the the average analyst estimate. In May, Mars Inc. announced plans to buy Wrigley for $23 billion.
08:35 am : S&P futures vs fair value: -3.7. Nasdaq futures vs fair value: -7.2. Futures continue to indicate a lower open as crude climbs 0.9% to $124.35 per barrel. Toyota (TM) lowered its 2008 worldwide sales target to 9.5 million vehicles from 9.85 million vehicles, with weakness in North America. According to the Wall Street Journal, Toyota sold 9.37 million cars in 2007.
08:05 am : S&P futures vs fair value: -3.8. Nasdaq futures vs fair value: -7.2. Futures suggest a lower start to the trading week. Dow component Verizon (VZ) reported earnings of $0.67 per share, which is two cents better than expectations. Meanwhile, Kraft (KFT) reported second quarter earnings that were well above estimates and issued upside 2008 earnings guidance. Private equity firm KKR plans to sell itself to the public, partly to rescue its struggling European unit, according to the Wall Street Journal. Two banks were shut down by the FDIC over the weekend, including First Nation Bank and First Heritage Bank. The deposits were taken over by Mutual of Omaha.
06:17 am : S&P futures vs fair value: -7.8. Nasdaq futures vs fair value: -17.0.
06:16 am : FTSE...5336.00...-16.60...-0.3%. DAX...6370.52...-66.19...-1.0%.
06:16 am : Nikkei...13353.78...+19.02...+0.1%. Hang Seng...22687.21...-53.50...-0.2%.
My posting is for my own entertainment, do your own DD before pushing your buy/call button
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