3SOF

Wall Street Turns Mixed.......


Tuesday 10/30/2007


Stocks in the U.S. turned mixed Tuesday afternoon as investors digested the latest round of earnings reports and positioned themselves ahead of the Federal Reserve's upcoming interest rate decision.

The Dow Jones Industrial Average was lower by 21 points, or 0.2%, to 13,849, pulled down by a 4% drop in component Procter & Gamble (PG:NYSE) . The S&P 500 was off 3 points, or 0.2%, at 1538.

The Nasdaq Composite reversed early losses and recently was up 10 points, or 0.4%, at 2827, boosted by a 15% jump in Sepracor (SEPR:) .

While traders were certainly thinking about the Fed and the latest quarterly numbers from corporate America, the news of the day was coming from Merrill Lynch (MER:) , which said embattled CEO Stan O'Neal has decided to leave the firm, effective immediately.

Rumors of O'Neal's departure pushed the stock 10.7% higher over the previous two sessions, but shares of Merrill were recently down 2.9% to $65.49.

Elsewhere, the Federal Open Market Committee convened for a two-day meeting, with a decision about rates due at 2:15 p.m. EDT on Wednesday. Most economists are expecting a 25-basis-point cut, the second reduction in as many months after the Fed kept its fed funds target rate at 5.25% for nine straight meetings dating back to June 2006.

Marc Pado, U.S. market strategist with Cantor Fitzgerald, said that the central bank had better not come up short or the market will panic.

"The rally over the last few days has been on less volume and less conviction, which we would take to imply that most of the funds completed their selling and are sitting pat, waiting for the Fed decision," he said. " [A cut of] 25 basis points is about 96% baked in the cake. Another 25 basis points is expected before the end of the year. Consolidation is the key for today."

In the meantime, the focus remained on earnings. UBS (UBS:) said that third-quarter income fell 41% from a year ago, as the Swiss financial services firm had to deal with writedowns due to the subprime mortgage mess over the summer.

UBS also warned it may have to take further writedowns in the fourth quarter because of its ongoing exposure to the U.S. mortgage markets. Shares were off 7 cents, or 0.1%, to $53.18.

European bourses dipped following the UBS numbers. London's FTSE 100 lost 0.7%, the Paris CAC 40 was off 0.6%, and Germany's Xetra Dax was down 0.4%.

Back in the U.S., Procter & Gamble posted fiscal first-quarter results that topped the Thomson First Call average estimate by a penny. P&G fell, though, after saying it expects fiscal second-quarter earnings per share of 95 cents to 97 cents, compared with Wall Street's expectation of 97 cents.

Shares of the Dow component were shedding $2.84 to $68.99.

U.S. Steel (X:) said third-quarter earnings fell 35% from a year ago, resulting in an earnings miss. Qwest Communications'' (Q:) quarterly results benefited from a $2.2 billion tax benefit, but the company cut its outlook for the full year.

U.S. Steel was recently losing 5.1% to $106.73, and Qwest was off 12.2% to $7.18.

Elsewhere, Colgate-Palmolive (CL:) posted a third-quarter profit that rose 22% from the year-ago period, exceeding the analyst target by a penny. Colgate was recently higher by $1.76, or 2.4%, to $76.02.

Away from equities, crude prices were retreating after setting new records on Monday. The December crude contract closed above $93 a barrel for the first time during the prior session, but it was recently falling $1.84 to $91.69.

Last time out, crude prices did little to dampen enthusiasm, except for in the transportation sector, and the New York market climbed. The Dow gained 63.56 points, or 0.46%, to 13,870.26, and the S&P 500 tacked on 5.70 points, or 0.37%, to 1540.98. The Nasdaq added 13.25 points, or 0.47%, to 2817.44.

On the economic front, the Conference Board said its consumer confidence index fell to a reading of 95.6 in October from 99.5 last month, worse than expectations for a reading of 99.0.

Treasury prices were retreating following the data. The 10-year note was losing 1/32 in price, yielding 4.39%. The 30-year bond shed 7/32 in price, yielding 4.68%. The dollar was rising slightly against the euro.

Futures Rise Ahead of Fed.......


Wednesday 10/31/2007


Stocks in the U.S. were set to start Wednesday's session with gains as investors made their final bets before the Federal Reserve's interest rate decision.

Futures on the S&P 500 were adding 6.30 points to 1542.30 and were 5 points above fair value. Nasdaq futures were up 9.2 points at 2227 and were 5.3 points higher than fair value.

At 2:15 p.m. EDT, the Federal Open Market Committee will end its two-day meeting and release a statement regarding rates and its views on the economy. Many analysts are expecting a 25-basis-point rate cut in the fed funds target, which would be the second reduction in the past two months, but a minority believes the central bank may lower by 50 points.

In the meantime, traders had to gear up for several releases looming on the economic docket. The Commerce Department will be first with its advance read on third-quarter gross domestic product. Economists have forecast that GDP rose 3.1% last quarter, down from 3.8% in the second quarter.

Later, at 10 a.m. EDT, reports on construction spending and the Chicago purchasing managers'' index are due.

On Tuesday, the major averages lost ground amid weak earnings and sliding oil prices. The Dow Jones Industrial Average fell 77.79 points, or 0.56%, to 13,792.47, pulled down by a 4% drop in Procter & Gamble (PG:) . The S&P 500 was off 9.96 points, or 0.65%, at 1531.02.

The Nasdaq Composite closed little changed, easing 0.73 point to 2816.71. The index was propped up by a 16.1% jump in Sepracor (SEPR:) .

Earnings took a backseat to the Fed's rate decision, although several companies were due out before the opening bell. Kraft Foods (KFT:) , Clorox (CLX:) and Jones Apparel (JNY:) are due to report early.

Already, Alcatel-Lucent (ALU:) posted a quarterly loss and trimmed its outlook. The company also replaced its financial chief and said it would cut 4,000 more jobs.

Crude prices were holding steady before the Energy Department's weekly inventory report, due at 10:30 a.m. EDT. The December crude contract was recently up 10 cents to $90.48.

Treasury prices were losing ground, with the 10-year note down 4/32 in price, yielding 4.40%. The 30-year bond was off 5/32 in price, yielding 4.69%. The dollar was hitting new lows against the euro once again.

Overseas markets were mostly higher. London's FTSE 100 was adding 0.4%, the Paris CAC 40 was up 0.4%, and Germany's Xetra Dax was 0.2% higher. In Asia, Japan's Nikkei 225 added 0.5% overnight, while Hong Kong's Hang Seng eased 0.9%.

Stocks Give Thumbs Up to Fed.......


Wednesday 10/31/2007


Stocks in the U.S. overcame the initial weakness that followed the Federal Reserve's rate cut and closed with substantial gains Wednesday.

The Dow Jones Industrial Average went from up 100 points before the Fed released its comments on rates and the economy all the way into negative territory, but then the rebound began. When the final bell rang, the Dow had a gain of 137.54 points, or 1%, at 13,930.01.

The S&P 500 jumped 18.36 points, or 1.2%, to 1549.38, and the Nasdaq Composite was better by 42.41 points, or 1.51%, at 2859.12.

As had been widely expected, the Federal Open Market Committee, the Fed's policymaking arm, decided to lower the fed funds target rate by 25 basis points to 4.50%. It was only the second rate reduction since June 2003, with the last coming in September.

In an accompanying statement, the Fed said that "the upside risks to inflation roughly balance the downside risks to growth," adding that "recent increases in energy and commodity prices, among other factors, may put renewed upward pressure on inflation."

"The key word is ''balance,'' which took the market down [initially] ," said Paul Mendelsohn, chief investment strategist with Windham Financial. "They are now in a neutral stance by saying risks are balanced because of inflation. This indicates that unless something major goes wrong with the economy, they are done with rate cuts."

Indeed, traders initially took a dim view of those remarks, but buyers appeared to believe the idea of a neutral economy probably isn't that bad considering the turmoil in the credit and housing markets in recent months.

"Today's action, combined with the policy action taken in September, should help forestall some of the adverse effects on the broader economy that might otherwise arise from the disruptions in financial markets and promote moderate growth over time," the statement read.

The central bank also reduced the discount rate by 25 basis points to 5%. It was the third cut to the discount rate, or the interest rate charged to banks that want to borrow, since mid-August.

Most analysts agree that the next data point, which comes later this week in the nonfarm payrolls report, will be important in judging officials'' future moves.

"Friday's job report is now the next key number," added Mendelsohn. "Barring any major problem on Friday, it would indicate that growth is not slowing as fast as we think and the market can keep its upward bias."

Peter Cardillo, chief market economist with Avalon Partners, said the Fed sent "a loud message" that they sacrificed containing inflation in lieu of economic activity. "Energy continues to rise and the dollar has been falling, and the market has been ignoring that," he said. "The Fed realizes that somewhere along the line that's going to mean inflation."

In light of the Fed's renewed concerns over inflationary pressures, record crude prices appeared worse than before. The December crude contract crossed $94 a barrel for the first time, finishing with a gain of $4.15 at $94.53 a barrel.

Earlier, the Energy Department said oil inventories unexpectedly dropped by 3.9 million barrels last week, while gasoline and distillate inventories rose slightly.

Treasury prices slid, with the 10-year note losing 19/32 in price, pushing the yield to 4.46%. The 30-year bond fell 26/32 in price, yielding 4.73%. The dollar rebounded after having set new lows against the euro.

Breadth was positive. On the New York Stock Exchange 2.55 billion shares changed hands, as advancers topped decliners by a 12-to-5 margin. Volume on the Nasdaq reached 2.46 billion shares, with winners edging losers nearly 3 to 2.

The gains that followed the Fed's decision pushed the Dow into positive territory for October. The blue chip average ended the month up 0.2%. The S&P 500 added 1.5%, and the Nasdaq surged 5.8%, its best monthly performance since July 2005.

Commodity-related indices had the best performance for the session. The Philadelphia Gold & Silver Sector Index jumped 3.7%, the Philadelphia Oil Service Sector Index was higher by 2.6%, and the Amex Oil Index added 2%.

Interestingly enough, transportation stocks also fared well despite rising oil prices. The Nasdaq Transportation Index rose 2.3% and the Dow Jones Transportation Average gained 1.4%.

Before of the Fed's announcement, traders scrutinized several releases on the economic docket. The Commerce Department released its advance read on third-quarter gross domestic product, which beat expectations with a 3.9% increase.

Economists had forecast that GDP rose 3.1% last quarter, compared with a 3.8% rate in the second quarter.

Ian Shepherdson, chief economist with High Frequency Economics, said that while the third-quarter number is positive on first blush, the market should expect fourth-quarter GDP to come in below a 2% clip.

" [The] key point here, though, is that things look very different in fourth-quarter post-turmoil," he said. "Residential investment plunged 20.1%. [The fourth quarter] will be worse."

Also on the economic front, the Census Bureau said that construction spending unexpectedly rose 0.3% last month, compared with estimates of a 0.4% decline. At the same time, the Chicago purchasing managers'' index declined to a reading of 49.7 for October, falling from last month's 54.2. Any reading below 50 indicates contraction.

Earnings took a backseat to the Fed's rate decision, although several companies were reporting. Kraft Foods (KFT:) posted a third-quarter profit that dropped 20% from a year ago. Still, Kraft beat estimates once charges were stripped out. Kraft gained 81 cents, or 2.5%, to $33.41.

Alcatel-Lucent (ALU:) posted a quarterly loss and trimmed its outlook. The company also replaced its financial chief and said it would cut 4,000 more jobs, sending the stock higher by 30 cents, or 3.2%, to close at $9.69.

Elsewhere, Clorox (CLX:) reported a fiscal first-quarter profit that topped expectations, and Jones Apparel (JNY:) blew away estimates with its third-quarter report. Shares of Clorox ended up $1.57, or 2.6%, to $62.57. Jones Apparel jumped $1.24, or 6.3%, to $20.94.

Away from earnings, Google (GOOG:) crossed the $700-a-share level for the first time ever. The Internet search giant rose $12.23, or 1.8%, to $707, the best close in its three-year history in the public markets.

Overseas markets were mostly higher. London's FTSE 100 added 0.9%, the Paris CAC 40 was up 0.8%, and Germany's Xetra Dax was 0.5% higher. In Asia, Japan's Nikkei 225 added 0.5% overnight, while Hong Kong's Hang Seng eased 0.9%.

Wall Street Gets Whacked !!!


Thursday 11/1/2007


Stocks in the U.S. sold off sharply Thursday as a profit shortfall at Exxon Mobil (XOM:) and a downgrade of Citigroup (C:) pressured the major averages and more than erased the prior session's gains.

The Dow Jones Industrial Average sank 362.14 points, or 2.6%, to 13,567.87. The S&P 500 lost 40.94 points, or 2.64%, at 1508.44, and the Nasdaq Composite tanked 64.29 points, or 2.25%, to 2794.83.

Two members of the Dow were notable losers, led by Citi, who fell $2.85, or 6.9% to a 52-week low at $38.51 after CIBC World Markets cut its rating on the stock and said it might be facing a huge capital shortfall. Credit Suisse also downgraded Citi.

Several brokers fell in sympathy. Morgan Stanley (MS:) tumbled 7.2%, Merrill Lynch (MER:) was down 5.8%, Bear Stearns (BSC:) lost 5%, and Lehman Brothers (LEH:) shed 4.5%.

"Sentiment has clearly turned decidedly negative, with Citigroup's multiple downgrades responsible for additional investor nervousness among financial stocks," said Michael Sheldon, chief market strategist with Spencer Clarke LLC. "Yesterday the market overreacted to the [Federal Reserve] rate cut, but a combo of record high oil and Citigroup news really changed investor's position by 180 degrees today."

Also dropping was Exxon Mobil. The oil giant's stock declined $3.49, or 3.8%, to $88.50 after its latest quarterly report, which showed profits that were 5 cents short of analysts'' expectations of $1.75. Weak refining margins were the primary culprit.

Breadth was markedly weaker. On the New York Stock Exchange 3.31 billion shares changed hands, as decliners trounced advancers by a 7-to-1 margin. Volume on the Nasdaq reached 2.52 billion shares, with losers beating winners 5 to 1.

Last time out, stocks surged following the Fed's decision to trim 25 basis points off the fed funds rate. The Dow seesawed during the session, but when the final bell rang, it had a gain of 137.54 points, or 1%, at 13,930.01.

The S&P 500 jumped 18.36 points, or 1.2%, to 1549.38, and the Nasdaq was better by 42.41 points, or 1.51%, at 2859.12.

"Looking at this decline, it's a little bit overdone," Robert Pavlik, chief investment officer with Oaktree Asset Management, said earlier. "Even though the Fed hasn't indicated any chance of another rate cut, they're willing to step in if the economy needs it. The hawkish statement that accompanied the Fed cut yesterday is now the focus, while the Citigroup and Exxon news certainly isn't helping."

Art Hogan, chief market analyst with Jefferies, said the pullback should be viewed as a typical hangover following a Fed interest rate decision.

"We had our celebration, but we forgot the Fed shifted their balance," said Hogan. "The guaranteed rate cut is gone, and investors are now looking at the news differently. If you drill down deeper into the Fed's statement and look at what's been affecting the market, there's more bad news than good news, and that's why we have this move today."

Meanwhile, crude prices topped $96 a barrel for the first time ever in electronic trading. The front-month December contract, though, ended with a loss of $1.04 at $93.49 a barrel.

Exxon Mobil wasn't the only energy name reporting, as both Marathon Oil (MRO:) and Tesoro (TSO:) said profits fell year over year, with soft margins playing a considerable role in the declines. Marathon lost 2.5% to $57.67, and Tesoro dropped 5.4% to $57.29.

Elsewhere, Sprint Nextel (S:) fell after its earnings slumped, while CVS Caremark (CVS:) and Eastman Kodak (EK:) topped estimates.

Sprint fell 3% to $16.58, CVS closed lower by 1.5% at $41.03, and Kodak lost 3.1% to $27.76.

Medco Health (MHS:) reported a third-quarter profit that rose 16% from a year ago and beat Wall Street's expectations, although revenue missed targets. The company also raised guidance for 2007. Medco finished up $2.25, or 2.4%, to $96.63.

Dominion Resources (D:) reported a third-quarter profit that tripled year-ago results, but PG&E (PCG:) , on the other hand, reported a 29% decline in earnings from a year ago. Dominion slumped 1.7%, and PG&E slid 5.5%.

On the economic front, the Commerce Department said personal income rose 0.4% in September, as expected. The report also noted that disposable personal income increased 0.4%, and personal consumption expenditures increased 0.3%.

"Consumer spending continued to support economic growth through the third quarter," said Peter Morici, professor at the University of Maryland School of Business and former chief economist at the U.S. International Trade Commission. "However, with rising energy prices, a sluggish jobs market and falling home values dragging on consumer confidence, consumer spending will grow slowly in fourth quarter."

Additionally, the Labor Department said initial jobless claims fell by 6,000 last week to 327,000 claims. Also, the Institute for Supply Management said its manufacturing index fell to a reading of 50.9 last month from 52.0 in September. The number fell short of estimates and was the lowest since March.

The releases were the last before the Labor Department's important monthly nonfarm payrolls report on Friday. Economists expect that the U.S. economy added 80,000 jobs last month.

Treasury prices were rallying as traders moved into the so-called safe haven of bonds. The 10-year note was up 31/32 in price, cutting the yield to 4.35%. The 30-year bond rose 1-26/32 in price, yielding 4.64%. The dollar was giving up ground against the euro.

Overseas markets were mixed. London's FTSE 100 was down 2%, the Paris CAC 40 was off 2%, and Germany's Xetra Dax was 1.7% lower. In Asia, Japan's Nikkei 225 added 0.8% overnight, while Hong Kong's Hang Seng tacked on 0.5%.

Stocks Eke Out Gains.......


Friday 11/2/2007


Stocks had a rocky session but ended slightly to the upside Friday afternoon as a robust jobs report was mostly overshadowed by lingering fears about the credit markets.

The Dow Jones Industrial Average rose 27 points to 13,595, and the S&P 500 gained 1 point to 1510. The Nasdaq Composite was up 16 points at 2810.

Paul Mendelsohn, chief investment strategist with Windham Financial, said that while the employment number was outstanding, bonds and equities have yet to stabilize following the previous Day's slide because of subprime and credit woes.

"The financials are in a freefall again, as the subprime problem continued to rise to the surface," he said. "You can see through all these ancillary units that there's a flight to safety. Insurance companies are lower. We don't know what the cross-credit risks are yet."

Earlier, a rebound appeared to be in order after the Labor Department's nonfarm payrolls report showed that the economy added 166,000 jobs last month, more than doubling expectations.

"Sustained payroll growth at this pace would keep the Federal Reserve on hold indefinitely, but that's an unlikely prospect," said Ian Shepherdson, chief economist with High Frequency Economics. "This report reflects the relative strength of third-quarter [gross domestic product] , and the rise in jobless claims is already signaling softer numbers ahead."

The report also said that the unemployment rate remained unchanged at 4.7%. Average hourly earnings rose 0.2%, slightly below consensus. The September and August data was revised to reflect 10,000 fewer jobs created.

Treasuries initially sold off after the data before turning higher. The 10-year note was up 11/32 in price, yielding 4.30%. The 30-year bond was rising 19/32 in price, yielding 4.60%.

With the early downturn, stocks'' were sliding again after a drubbing Thursday, when a profit shortfall at Exxon Mobil (XOM:) and downgrades of Citigroup (C:) sent U.S. shares sharply lower.

The Dow plunged 362.14 points, or 2.6%, to 13,567.87, and the S&P 500 lost 40.94 points, or 2.64%, at 1508.44. The Nasdaq sank 64.29 points, or 2.25%, to 2794.83.

As with the previous session, Citigroup led the financial sector lower with a nearly 2% loss. Bank of America (BAC:) , Merrill Lynch (MER:) , Goldman Sachs (GS:) , and Morgan Stanley (MS:) were all falling 2.8% or more. Dow component AIG (AIG:) slid 3.8% due to fear of exposure.

Homebuilders were also suffering. Toll Brothers (TOL:) , Ryland (RYL:) , Centex (CTX:) , Beazer Homes (BZH:) and Standard Pacific (SPF:) were all sliding by more than 1.5%.

Peter Morici, professor at the University of Maryland School of Business and former chief economist at the U.S. International Trade Commission, said that unfortunately, this week's Fed statement suggested it's through cutting interest rates. "This only served to further destabilize credit, stock and housing markets, and negate the potential positive effects of its quarter-point reduction in the federal funds rate."

Earnings took a backseat during the last day of the week, even as several big names were reporting results. Chevron (CVX:) posted a 26% decline in third-quarter profit, which fell short of estimates.

Elsewhere, Martha Stewart Living (MSO:) posted a narrower-than-expected third-quarter loss, while NYSE Euronext (NYX:) topped analysts'' expectations for its latest quarter.

Cigna (CI:) also exceeded estimates and offered an upbeat forecast on its full-year profits. Duke Energy (DUK:) and Viacom (VIA:) were better than anticipated with their earnings.

Among research calls, Deutsche Bank upgraded Sprint Nextel (S:) to hold from sell, but downgraded Electronic Arts (ERTS:) to sell from hold. eBay (EBAY:) was downgraded at Bear Stearns.

Overseas markets were weak. London's FTSE 100 was down 1.3%, the Paris CAC 40 was off 0.6%, and Germany's Xetra Dax was 0.8% lower. In Asia, Hong Kong's Hang Seng dropped 3.3% overnight, and Japan's Nikkei 225 lost 2.1%.

Crude oil prices were again higher. The December front-month crude contract was rising 98 cents in floor trading to $94.47 a barrel.

Financials Pull Down Stocks.......


Monday 11/5/2007


Stocks in the U.S. closed with modest losses Monday as worries about the health of the financial sector continued to swirl.

The Dow Jones Industrial Average lost 51.70 points, or 0.4%, to 13,543.40, and the S&P 500 was down 7.48 points, or 0.5%, at 1502.17. The Nasdaq gave back 15.20 points, or 0.5%, at 2795.18.

Weighing on the mood all day was news out of Citigroup (C:) that it would record writedowns of as much as $11 billion to cover added losses on mortgage-backed securities and collateralized debt obligations, an announcement that came as CEO Chuck Prince resigned under pressure.

Citi also restated its third-quarter profit lower by $166 million to fix the value of certain debt obligations, and its shares were down 4.9% to $35.90, a 52-week low.

Uncertainty about how deep the credit crisis really is have had the markets on edge since the summer, and despite the occasional sign that it's clearing up, big banks and financial companies continue to reveal that they still don't have a firm grasp on just how much pain they'll ultimately feel.

Indeed, Federal Reserve Governor Frederic Mishkin said during a speech that the stress of the past few months "has reminded investors and policymakers alike that financial instability, if allowed to develop fully, could have severely negative consequences not only for the functioning of financial markets but also, importantly, for the macroeconomic prospects of our country, as well as others."

During its past two meetings, Fed policymakers have moved to settle things down by cutting the fed funds target rate by a combined 75 basis points.

Those actions "should help forestall some of the adverse effects on the broader economy that might otherwise arise from the disruptions in financial markets and should help promote moderate growth over time," Mishkin said.

He also said that he "will want to carefully assess incoming data and gauge the effects of financial and other developments on economic prospects before considering further policy action."

Another Fed governor, Randall Kroszner, said in Washington that "conditions for subprime borrowers have the potential to get worse before they get better," because housing activity appears to still be weakening and the bulk of rate resets have yet to come.

Also pressuring the financials was a Lehman Brothers downgrade of the U.S brokerage sector to neutral from positive. Bear Stearns (BSC:) and Merrill Lynch (MER:) were both taken down to equal-weight from overweight, and the stocks lost more than 2%.

The KBW Bank Index was worse by 0.9%, and the NYSE Financial Sector Index was off 1.6%. The Amex Securities Broker/Dealer Index fell 2.7%.

World indices were weak along with the New York market. London's FTSE was down 1.1%, and Frankfurt's Dax slipped 0.5%. Overnight, Tokyo's Nikkei dropped 1.5%, and Hong Kong's Hang Seng sank 5%.

One of the top stories overseas was PetroChina (PTR:NYSE) , whose global market value surpassed $1 trillion after its listing of shares in Shanghai, making it the biggest company in the world.

After the stock offer, Bear Stearns downgraded PetroChina to underperform from peer perform, citing its valuation. PetroChina's U.S.-listed shares plunged 12.9% to $222.10.

Meanwhile, Home Depot (HD:) and Lowe's (LOW:) each declined after Deutsche Bank cut its ratings on both home-improvement retailers to hold from buy.

Elsewhere, a few notable earnings were coming in. Marvel Enterprises (MVL:) topped estimates for the latest quarter and guided higher, while Burger King (BKC:) was essentially in line with expectations.

Treasuries were lower. The 10-year note was down 5/32 in price, yielding 4.34%, and the 30-year bond surrendered 8/32, yielding 4.63%. The dollar was mostly to the downside.

As for commodities, oil was down $1.95 to $93.98 a barrel, and gold was up $2.30 at $810.80 an ounce.

The session's lone economic report was the Institute for Supply Management's services index, which came in stronger than expected at 55.8. The consensus estimate was 54.

Stocks Aim to Bounce Back.......


Tuesday 11/6/2007 7:50 AM EST


Stock index futures were pointing to a higher open for the U.S. market as investors looked to recover from the prior session's sluggishness.

Futures on the S&P 500 were gaining 8.90 points to 1514.30 and were 5 points above fair value. Nasdaq 100 futures were adding 12.50 points at 2225.25 and were 6.03 points ahead of fair value.

On Monday, weakness in the financial sector, led by Citigroup (C:) , pushed stocks lower. The Dow Jones Industrial Average lost 51.70 points, or 0.4%, to 13,543.40, and the S&P 500 was down 7.48 points, or 0.5%, at 1502.17. The Nasdaq declined 15.20 points, or 0.5%, at 2795.18.

Following the close and into the new morning, traders were digesting another round of corporate earnings.

Among them, Activision (ATVI:) topped estimates, while Sun Microsystems (JAVA:) saw its revenue miss the consensus. Nortel's (NT:) quarterly profits were a bit better than expected, but sales were light.

Overseas, markets were mostly higher. London's FTSE tacked on 0.2%, and Frankfurt's Dax was up 0.4%. In Asia, Tokyo's Nikkei slipped 0.1%. Hong Kong's Hang Seng rose 1.7%.

Government bond prices were falling. The 10-year note was down 3/32 in price, yielding 4.35%, and the 30-year bond was losing 4/32 to yield 4.64%.

The dollar was weak against the other major currencies, with the exception of the Japanese yen. Against the euro, it hit a record low.

As for commodities, crude oil was surging $1.69 to $95.67 a barrel, and gold was jumping $11.10 to $821.90 an ounce, putting it roughly $3 from its 1980 all-time high at $825.

Blue Chips Stage Rally.......


Tuesday 11/6/2007 2:40 PM EST


Blue chips were back near their session highs Tuesday afternoon, but the tech-heavy Nasdaq was lagging behind.

The Dow Jones Industrial Average was recently adding 57 points at 13,601, and the S&P 500 was up 9 points at 1511. The Nasdaq was tacking on 10 points at 2805.

Commodities were having a banner day, with crude oil surging $2.34 to $96.32 a barrel, and gold jumping $14.90 to $825.70 an ounce, putting it above its 1980 all-time closing high.

Shares of energy companies and miners were lifted by the action. The Philadelphia Gold & Silver Sector Index was gaining 2.5%, and the Amex Gold Bugs Index was popping 3.4%, putting both among the best-performing subgroups of the day.

Big winners in terms of individual stocks were Newmont Mining (NEM:NYSE) , up 4%, and Kinross Gold (KGC:NYSE) , higher by 3.6%. Coeur d'Alene (CDE:NYSE) was stronger by 6.8%.

On the energy side, the Amex Oil Index was advancing 1.4%, led by a 3.4% rise in Valero Energy (VLO:NYSE) and a 2.8% move up in Hess (HES:NYSE) .

Valero's move came after it said shrinking refining margins pushed its third-quarter operating income down to $1.2 billion from $2.3 billion in the same period last year. Valero's adjusted profits, however, topped analysts' lowered estimates.

Elsewhere, mortgage lender IndyMac Bancorp (IMB:NYSE) reported a loss of $202.7 million, or $2.77 a share, for the third quarter, reversing last year's profit.

Largely responsible for the loss were pretax credit costs of $407.7 million and a $167.2 million pretax loss related to mortgage-backed securities. For the fourth quarter and next year, IndyMac said it "could be modestly profitable, or we could struggle and have additional losses, although we believe any quarterly losses would likely be substantially lower than the [third quarter] ."

Also, Activision (ATVI:) topped estimates, while Sun Microsystems (JAVA:) saw its revenue miss the consensus. Both reported following the last close. Nortel (NT:) swung to a quarterly profit.

Among analyst calls, Deutsche Bank upgraded MasterCard (MA:) to buy from hold and raised its target price to $250 from $133.

Bank of America downgraded Citigroup (C:) to neutral from buy, and Morgan Stanley cut its rating on soft lines and hard lines retailers to cautious from in-line.

Overseas, markets were mostly higher. London's FTSE tacked on 0.2%, and Frankfurt's Dax was up 0.4%. In Asia, Tokyo's Nikkei slipped 0.1%. Hong Kong's Hang Seng rose 1.7%.

Government bond prices were falling. The 10-year note was down 3/32 in price, yielding 4.35%, and the 30-year bond was losing 4/32 to yield 4.64%.

The dollar was weak and continuing its downtrend against most other major currencies, with the exception of the Japanese yen. Against the euro, it hit a record low.

Stocks Surge Into the Close.......


Tuesday 11/6/2007


Stocks in the U.S. ended at their session highs Tuesday as a late afternoon rally sent the major averages into the close on an up note.

The Dow Jones Industrial Average rose 117.54 points, or 0.9%, to 13,660.94, and the S&P 500 was up 18.10 points, or 1.2%, at 1520.27. The Nasdaq gained 30 points, or 1.1%, to 2825.18.

Commodities had a banner day, with crude oil surging $2.72 to $96.70 a barrel, and gold jumping $12.60 at $823.40 an ounce, putting it near its 1980 all-time closing high.

Shares of energy companies and miners were lifted by the action. The Philadelphia Gold and Silver Sector Index gained 3.5%, and the Amex Gold Bugs Index popped 4.4%, putting both among the best-performing subgroups of the day.

Big winners in terms of individual stocks were Newmont Mining (NEM:NYSE) , up 4.1%, and Kinross Gold (KGC:NYSE) , higher by 2.7%. Coeur d' Alene (CDE:NYSE) was stronger by 13.5%.

On the energy side, the Amex Oil Index advanced 2.8%, led by a 4.8% rise in Valero Energy (VLO:NYSE) and a 7.1% move up in Hess (HES:NYSE) .

Valero's increase came after it said shrinking refining margins pushed its third-quarter operating income down to $1.2 billion from $2.3 billion in the same period last year. Valero's adjusted profits, however, topped analysts' lowered estimates.

Elsewhere, mortgage lender IndyMac Bancorp (IMB:NYSE) reported a loss of $202.7 million, or $2.77 a share, for the third quarter, reversing last year's profit.

Largely responsible for the loss were pretax credit costs of $407.7 million and a $167.2 million pretax loss related to mortgage-backed securities. For the fourth quarter and next year, IndyMac said it "could be modestly profitable, or we could struggle and have additional losses, although we believe any quarterly losses would likely be substantially lower than the [third quarter] ."

IndyMac slipped 2.2%.

Also, Activision (ATVI:) topped estimates, while Sun Microsystems (JAVA:) saw its revenue miss the consensus. Both reported following the last close. Nortel (NT:) swung to a quarterly profit.

Among analyst calls, Deutsche Bank upgraded MasterCard (MA:) to buy from hold and raised its target price to $250 from $133.

Bank of America downgraded Citigroup (C:) to neutral from buy, and Morgan Stanley cut its rating on soft lines and hard lines retailers to cautious from in-line.

Overseas, markets were mostly higher. London's FTSE tacked on 0.2%, and Frankfurt's Dax was up 0.3%. In Asia, Tokyo's Nikkei slipped 0.1%. Hong Kong's Hang Seng rose 1.7%.

Government bond prices were falling. The 10-year note was down 5/32 in price, yielding 4.34%, and the 30-year bond was losing 7/32 to yield 4.63%.

The dollar was weak, continuing its downtrend against most other major currencies, with the exception of the Japanese yen. Against the euro, it hit a record low.

Stocks Get Roughed Up.......


Wednesday 11/7/2007


Troubling comments from a Federal Reserve official, weak earnings and a plummeting dollar pushed stocks in the U.S. deep into the red Wednesday.

The Dow Jones Industrial Average sank 360.92 points, or 2.64%, to 13,300.02. The S&P 500 plunged 44.65 points, or 2.94%, at 1475.62, and the Nasdaq Composite tumbled 76.42 points, or 2.7%, at 2748.76.

"This was a confluence of oil, subprime and dollar fears all hitting the market at once," said Paul Nolte, director of investments with Hinsdale Associates. "These factors have all been there, but this is the first day they've all been front and center. It seems no one wanted to hold anything overnight, which is why we had this late-session selloff."

The major averages fell to their worst levels of the day after St. Louis Fed President William Poole said that the central bank will not raise interest rates when it meets Dec. 11. Investors took Poole's comments as a sign that the Fed believes recent credit problems will persist.

"Market participants must be confident that they can take positions without the risk that the Fed might raise rates," said Poole during a speech in Milwaukee. "Barring unusual circumstances, the [Federal Open Market Committee] would not consider a rate increase just after cutting its fed funds rate target."

Poole added that "the Fed needs to be careful to do what is necessary, but not more."

Crude prices also pressured stocks. Overnight, crude oil touched a record $98.62 a barrel in electronic trading. Crude lost its gains, though, after the Energy Department's weekly inventory report showed a softer-than-expected decline of 800,000 barrels in oil stocks. Oil ended lower by 33 cents at $96.37 a barrel.

Meanwhile, the dollar hit fresh lows against the euro as an official in China said Beijing should adjust its currency reserves to a stronger currency than the dollar.

"The weak dollar is potentially pressuring China to peg its yuan to stronger currencies," said Marc Pado, U.S. market strategist with Cantor Fitzgerald. "Historically, China has been forced to buy dollars to maintain the peg. As they turn to sell those dollars, it could cause a short-term crisis."

During a speech on financial markets in New York, Fed Governor Kevin Warsh noted that the central bank may have to act if the decline in the dollar led to higher prices for imported goods.

The dollar's weakness had gold futures surging. Gold jumped $10.10 to close at a record $833.50 an ounce. Silver relinquished early gains and finished lower by 5 cents to $15.32 an ounce.

"All of a sudden today oil was too high and the dollar was too low," said Phillip Roth, chief technical market analyst with Miller Tabak. "The floodgates opened and volume picked up dramatically. This seems to be emotional selling, the first we've seen since August. The market still has a long way to go in its corrective process."

Among the worst performing sector indices, the NYSE Financial Index dropped 4.2%, the Philadelphia Housing Sector Index slumped 3.9%, and the Dow Jones Transportation Average fell 3.2%.

Washington Mutual (WM:) was the weakest of the financial names, plummeting 17.3%. Bear Stearns (BSC:) , Morgan Stanley (MS:) , Lehman Brothers (LEH:) and Bank of America (BAC:) lost 4.9% or more on the day.

Breadth was decidedly negative. On the New York Stock Exchange 3.11 billion shares changed hands, as decliners toppled advancers by a 10-to-1 margin. Volume on the Nasdaq reached 2.49 billion shares, with losers beating winners nearly 4 to 1.

Little help was found on the earnings docket. Dow component General Motors (GM:) posted a staggering third-quarter net loss of $39 billion, or $68.85 a share. Excluding items, the company lost $2.80 a share, well below the Thomson First Call estimate.

Shares of GM dropped $2.21, or 6.1%, to $33.95. Rival Ford (F:) , which reports its results Thursday, lost 4.5%. Toyota (TM:) slipped 0.3% despite reporting a rise in second-quarter profits.

Also, Time Warner (TWX:) reported a 53% decline in third-quarter earnings compared to a year ago. Excluding items, the media giant earned 24 cents a share, matching Wall Street's estimates. Time Warner shares were off 53 cents, or 2.9%, to close at $17.80.

Following the close, Cisco (CSCO:Nasdaq) sank after its solid quarter and in-line guidance failed to impress investors. Dow component AIG (AIG:) was also due to report quarterly earnings.

On the economic front, the Labor Department said its preliminary read on third-quarter productivity showed a 4.9% jump, nearly doubling expectations. Unit labor costs unexpectedly eased 0.2%, much better than estimates for a 1.0% increase.

U.S. Treasury securities were higher following a volatile session. The 10-year note rose 12/32 in price, dropping the yield to 4.33%. The 30-year bond was up 3/32 in price to yield 4.66%.

Most overseas indices were lower. In Europe, London's FTSE 100 was fell 0.9%, the Paris CAC 40 lost 0.5%, and Germany's Xetra Dax was down 0.4%. In Asia, Japan's Nikkei 225 dropped nearly 1% overnight, while Hong Kong's Hang Seng added 0.9%.

Tech Stocks Tumble.......


Thursday 11/8/2007


Stocks plunged anew Thursday before mounting a late rally that erased the worst of the blue-chip losses and cut tech shares'' declines almost in half.

The Dow Jones Industrial Average ended down 33.73 points, or 0.25%, at 13,266.29 -- nearly 200 points above its session low. The S&P 500 also rebounded from session lows, ending off by 0.85 point, or 0.06%, to 1474.77.

The Nasdaq Composite was the hardest hit, plunging by more than 90 points around midday. But by the finish it showed a loss of 52.76 points, or 1.92%, at 2696. Troubling comments from networking giant Cisco (CSCO:) played a large role in the weakness.

"All of this [comeback] occurred in the last hour of trading, and the only thing we could point to is some short-term covering," said Robert Pavlik, chief investment officer with Oaktree Asset Management. "There is still a more exaggerated weakness in technology. We recovered a lot as the selloff may have been overdone, but it's hard to really take anything positive away from this. We still need to see some stabilization in equities, the dollar, oil prices and financials."

Once again, the market was steered by continued concerns over economic growth, the weak dollar and the financial crisis.

Cisco dragged on tech stocks after the company said it had a quarterly fiscal first-quarter profit of 37 cents a share, which topped Wall Street's estimates by a penny. Although the company provided in-line guidance, investors grew jittery after the tech behemoth said it is feeling the effects of the credit crunch. Shares of Cisco dropped $3.12, or 9.5%, to $29.63.

Major tech names that have seen big run-ups in recent months were particularly under pressure.Oracle (ORCL:) plummeted 7.9%, Research In Motion (RIMM:) spiraled 6.4% lower, Apple (AAPL:) lost 5.8%, and Google (GOOG:) slid 5.3%.

On the New York Stock Exchange, 4.74 billion shares changed hands, as falling stocks eked past advancers by a 9-to-8 margin. Volume on the Nasdaq reached 3.40 billion shares, with losers edging winners 8 to 7.

The declines built on a selloff from last time out, when record oil prices, a weaker dollar and disappointing earnings combined to sink the major averages. The Dow plummeted 360.92 points, or 2.6%, to 13,300.02. The S&P plunged 44.65 points, or 2.9%, at 1475.62, and the Nasdaq tumbled 76.42 points, or 2.7%, at 2748.76.

In the spotlight in the new session was Federal Reserve Chairman Ben Bernanke, who delivered his economic outlook before the Joint Economic Committee in Washington. Bernanke said that further sharp increases in crude oil prices have put renewed upward pressure on inflation and may impose further restraint on economic activity.

"Recent increases in energy prices will likely lead overall inflation to rise for a time," he said. "The few data releases that have become available have continued to suggest that the overall economy remained resilient in recent months. However, financial market volatility and strains have persisted.

Policymakers, he said, repeating past remarks, will act as needed to "foster price stability and sustainable economic growth."

"Mr. Bernanke gave no ground to the market's desire for further easing in his testimony," said Ian Shepherdson, chief economist with High Frequency Economics. "Mr. Bernanke's language today was perhaps even a bit less market-friendly than the FOMC's. Until the Fed gets real and stops referring to the housing disaster as a mere ''correction,'' they will be behind the curve."

Treasury prices were mixed after Bernanke's speech. The 10-year note was up 14/32 in price, cutting the yield to 4.26%. The 30-year bond fell by 3/32 to yield 4.66%.

Among the worst-performing subsector indices, the Amex Airline Index fell 1.6%, the Philadelphia Semiconductor Sector Index fell 1.5%, and the S&P Retail Index was down 0.3%.

"This subprime problem is rolling across everything, with even tech stocks getting hit now," said Paul Mendelsohn, chief investment strategist with Windham Financial. "The assumption and the link has been made that the subprime issues are hitting other parts of the economy. The subprime problem is certainly not over with yet, and we can't calculate what the impact on the economy will be."

Peter Cardillo, chief market economist with Avalon Partners, said that after the market sold off sharply, key technical levels were held and the market had a chance to bounce.

"However, there are some important pieces of economic data tomorrow in the form of import prices and the trade balance which brings more uncertainty, so we should probably stay in a trading range," he said.

While traders were again eying the earnings docket, with Ford (F:) and Dean Foods (DF:) out with results before the opening bell, considerable focus was falling on chain stores, which had their monthly same-store sales.

Wal-Mart (WMT:) disappointed after posting a comp-sales increase of only 0.7%, compared with expectations of a 1.1% rise. Shares of the world's largest retailer finished down 31 cents, or 0.7%, to $43.62.

Rival Target (TGT:) , on the other hand, reported an October comp sales rise of 4.1%, compared with expectations of a 2.5% gain. Still, Target was 0.2% lower at $58.70.

Apparel retailers were the worst of the lot. Nordstrom (JWN:) , Limited (LTD:) , Gap (GPS:) and Chico's FAS (CHS:) all reported monthly losses and missed consensus targets.

Gap, however, offered strong guidance for the third quarter, and shares advanced 6.7% to $19.36.

As for earnings, insurance giant AIG (AIG:) said third-quarter profit fell 27% from a year ago, short of the Thomson First Call target. The stock slid $1.90, or 3.3%, to $56.

Ford posted a narrower-than-expected loss of $380 million. Excluding items, the company lost a penny a share, compared with expectations of a loss of 46 cents a share. Shares of Ford were adding 24 cents, or 2.9%, to $8.48.

Dean Foods, meanwhile, missed the consensus by a penny and issued in-line guidance for the fourth quarter. The stock managed to rise $1.07, or 4.2%, to $26.70.

Away from earnings, shares of Rio Tinto (RTP:) soared 23.1% to $440.20 after the company said BHP Billiton (BHP:) offered to buy it, but that the $109 billion bid was too low.

Morgan Stanley (MS:) was also making headlines, becoming the latest financial name to announce writedowns due to the subprime crisis. The firm said its fourth-quarter profit will be reduced by $2.5 billion because of the credit market problems. Shares were up $2.49, or 4.9%, to $53.68.

The dollar was weak again after both the Bank of England and the European Central Bank came out with separate announcements that they would not change key interest rates. The euro was climbing against the dollar on the news.

European bourses were little changed following the policy announcements. London's FTSE 100 was down 0.1%, while Germany's Xetra Dax added 0.3%.

Also on the U.S. economic docket, the Labor Department said that initial jobless claims fell by 13,000 last week to 317,000 claims, a bigger-than-expected decline.

Commodities were mixed in a volatile session. The December crude contract ended down 91 cents to $95.46 a barrel. Gold and silver futures were on the upswing.

Stocks Brace for More Losses.......


Friday 11/9/2007 7:51 AM EST


Stocks in the U.S. were set to fall again Friday as increased loan losses at Wachovia (WB:) and a weak quarter from Qualcomm (QCOM:) weighed on sentiment.

Futures on the S&P 500 were down 14.40 points to 1461.20 and were more than 18 points beneath fair value. Nasdaq 100 futures were losing 16.5 points at 2089 and were 23 points below fair value.

Before the opening bell, Wachovia became the latest lender to announce a writedowns, following Citigroup (C:) , Merrill Lynch (MER:) and Morgan Stanley (MS:) .

The fourth-largest U.S. bank said it expects to record a $1.1 billion writedown in debt obligations for October alone due to the recent subprime mortgage and credit mess. Shares of Wachovia were set to open 2.3% lower.

Meanwhile, Barclays (BCS:) lost nearly 8% in the premarket session as rumors swirled the lender would be the next in line to announce a hefty debt-valuation charge.

Elsewhere, Qualcomm was set to drag on technology stocks early. The company posted fiscal fourth-quarter earnings and revenue numbers late Thursday that exceeded Wall Street's estimates, but poor fiscal 2008 guidance dropped the stock in the premarket session.

Last time out, weak monthly retail chain store sales, a near 10% drop in Cisco (CSCO:) , and more rhetoric from Federal Reserve Chairman Ben Bernanke combined to sink the market. The major averages, though, managed to rebound from heavy selling, paring losses in the final hour of trading.

The Dow Jones Industrial Average ended down 33.73 points, or 0.25%, at 13,266.29 -- nearly 200 points above its session low. The S&P 500 also bounced back from its worst, finished lower by 0.85 point, or 0.06%, to 1474.77.

The Nasdaq Composite was the hardest hit, plunging by more than 90 points around midday. But by the close it showed a loss of 52.76 points, or 1.92%, at 2696.

Among other names reporting earnings after the previous close, Dow component Disney (DIS:) narrowly beat estimates, and chipmaker Nvidia (NVDA:) posted a profit that more than doubled from a year ago.

In addition to earnings, traders will focus on the latest batch of economic data. At 8:30 a.m. EST, reports on both the international trade balance and the import price index are due, and traders hope both will show what effect, if any, the weaker U.S. dollar has had.

Later, at 10 a.m. EST, the University of Michigan will post its consumer sentiment index for November.

Commodities were losing ground early. Crude was off 28 cents to $95.18 a barrel, gold was lower by $5.90 at $831.60 an ounce, and silver slid 32 cents to $15.19 an ounce.

U.S. Treasury's were rallying, sinking yields. The 10-year note was rising 9/32 in price, yielding 4.25%. The 30-year bond was higher by 20/32 in price, yielding 4.63%. Not surprisingly, the dollar continued to slide against the euro.

Overseas markets were mixed. In Asia, Hong Kong's Hang Seng tacked on 0.1%, while Japan's Nikkei 225 slipped 1.2%. Among European bourses, London's FTSE 100 lost 1%, and Germany's Xetra Dax added 0.2%.

Credit Woes Drop Stocks Again.......


Friday 11/9/2007 11:20 AM EST


Stocks in the U.S. were falling hard again Friday as increased loan losses at Wachovia (WB:) and a weak quarter from Qualcomm (QCOM:) weighed on sentiment.

The Dow Jones Industrial Average was sinking 137 points, or 1%, to 13,129, and the S&P 500 was dropping 13.5 points, or 0.9%, to 1461. The Nasdaq Composite was plunging 46 points, or 1.7%, to 2650.

Contributing to the selloff was Wachovia, which became the latest lender to announce a writedown, following Citigroup (C:) , Merrill Lynch (MER:) and Morgan Stanley (MS:) .

The fourth-largest U.S. bank said it expects to record a $1.1 billion writedown in debt obligations for October alone because of the recent subprime mortgage and credit mess. Shares of Wachovia were 2% lower at $39.49.

Meanwhile, Barclays (BCS:) lost 4.1% as rumors swirled the lender would be the next in line to announce a hefty debt-valuation charge. Barclays denied the rumor it would write down $10 billion due to exposure, though it didn't comment on whether there would be a writedown at all.

Fannie Mae (FNM:) shares were also stung by the subprime mortgage and credit market volatility. The company said it had a fiscal first-quarter profit of $1.17 a share, a 57% drop from a year ago. Shares were falling $3.55, or 7.1%, to $46.25.

Elsewhere, Qualcomm was dragging on technology stocks. The company posted fiscal fourth-quarter earnings and revenue numbers late Thursday that exceeded Wall Street's estimates, but poor fiscal 2008 guidance dropped the stock 3.5% to $38.36.

Major tech names were under pressure for the second straight day. Research In Motion (RIMM:) was 5.1% lower, Google (GOOG:) was sliding 3%, Oracle (ORCL:) fell 1.6%, and Apple (AAPL:) lost 1.4%.

Last time out, weak monthly retail chain-store sales, a near 10% drop in Cisco (CSCO:) , and more rhetoric from Federal Reserve Chairman Ben Bernanke combined to sink the market. The major averages, though, managed to rebound from heavy selling, paring losses in the final hour of trading.

The Dow ended down 33.73 points, or 0.25%, at 13,266.29 -- nearly 200 points above its session low. The S&P 500 also bounced back from its worst, finished lower by 0.85 point, or 0.06%, to 1474.77.

The Nasdaq was the hardest hit, plunging by more than 90 points around midday. But by the close it showed a loss of 52.76 points, or 1.92%, at 2696.

"We may not have seen a reversal day, but it felt like capitulation in financials," said Marc Pado, U.S. market strategist with Cantor Fitzgerald. "That will get test by Wachovia today. It might be tough to get things going on a Friday, but hopefully we see more strength in the financials and some stability in tech. Just making it through this week and not closing on the lows would be good."

Among other names reporting earnings after the previous close, Dow component Disney (DIS:) narrowly beat estimates, and chipmaker Nvidia (NVDA:) posted a profit that more than doubled from a year ago. Shares of Disney fell 2.8%, while Nvidia was tacking on 0.1%.

Aside from earnings, traders had to focus on the latest batch of economic data. The Labor Department said that its import price index jumped 1.8% last month, well above expectations. At the same time, the Commerce Department said that the international trade balance unexpectedly narrowed to a deficit of $56.5 billion during September from a revised $56.8 billion in August.

Additionally, the University of Michigan said the November reading of its consumer sentiment index came in at a surprisingly low 75.0, the lowest level in two years.

Commodities were mixed. Crude was up 21 cents to $95.67 a barrel, gold was lower by $2.10 at $835.40 an ounce, and silver was off by a penny to $15.50 an ounce.

U.S. Treasuries were rallying, sinking yields. The 10-year note was rising 8/32 in price, yielding 4.25%. The 30-year bond was higher by 18/32 in price, yielding 4.63%. Not surprisingly, the dollar continued to slide against the euro.

Overseas markets were mostly lower. In Asia, Hong Kong's Hang Seng tacked on 0.1%, while Japan's Nikkei 225 slipped 1.2%. Among European bourses, London's FTSE 100 lost 1.3%, and the Paris CAC 40 fell 1.5%.

Tech Stocks Slapped Again.......


Friday into the closing 11/9/2007


Stocks in the U.S. were falling again Friday as increased loan losses at Wachovia (WB:) and a weak quarter from Qualcomm (QCOM:) weighed on sentiment.

The Dow Jones Industrial Average was down 82 points, or 0.6%, to 13,184, and the S&P 500 was dropping 4 points, or 0.3%, to 1471. The Nasdaq Composite was off 35 points, or 1.3%, to 2661. All three were above their worst levels.

The major averages were set to notch a losing week. Currently, the Dow has lost 3.4% thus far, and the S&P 500 is down 3.1%. The Nasdaq has suffered the most, tumbling more than 6%.

Contributing to the latest selloff was Wachovia, which became the latest lender to announce a writedown, following Citigroup (C:) , Merrill Lynch (MER:) and Morgan Stanley (MS:) .

The fourth-largest U.S. bank said it expects to record a $1.1 billion writedown in debt obligations for October alone because of the recent subprime mortgage and credit mess. Shares of Wachovia reversed early losses and were recently higher by 0.4%.

Meanwhile, Barclays (BCS:) lost 2.9% as rumors swirled that the lender would be the next in line to announce a hefty debt-valuation charge. Barclays denied the rumor it would write down $10 billion due to exposure, though it didn't comment on whether there would be a writedown at all.

Fannie Mae (FNM:) shares were also stung by the subprime mortgage and credit market volatility. The company said it had a fiscal third-quarter loss of $1.4 billion, or $1.56 a share, more than doubling its losses from a year ago. Shares were falling $2.59, or 5.2%, to $47.21.

Elsewhere, Qualcomm was dragging on technology stocks. The company posted fiscal fourth-quarter earnings and revenue numbers late Thursday that exceeded Wall Street's estimates, but poor fiscal 2008 guidance dropped the stock 3.7% to $38.31.

Major tech names were under pressure for the second straight day. Research In Motion (RIMM:) was 7.4% lower, Oracle (ORCL:) fell 3.9%, Google (GOOG:) was sliding 2.7%, and Apple (AAPL:) lost 2.5%.

Last time out, weak monthly retail chain-store sales, a near 10% drop in Cisco (CSCO:) , and more rhetoric from Federal Reserve Chairman Ben Bernanke combined to sink the market. The major averages, though, managed to rebound from heavy selling, paring losses in the final hour of trading.

The Dow ended down 33.73 points, or 0.25%, at 13,266.29 -- nearly 200 points above its session low. The S&P 500 also bounced back from its worst, finished lower by 0.85 point, or 0.06%, to 1474.77.

The Nasdaq was the hardest hit, plunging by more than 90 points around midday. By the close it showed a loss of 52.76 points, or 1.92%, at 2696.

"We may not have seen a reversal day, but it felt like capitulation in financials," said Marc Pado, U.S. market strategist with Cantor Fitzgerald. "That will get test by Wachovia today. It might be tough to get things going on a Friday, but hopefully we see more strength in the financials and some stability in tech. Just making it through this week and not closing on the lows would be good."

Among other names reporting earnings after the previous close, Dow component Disney (DIS:) narrowly beat estimates, and chipmaker Nvidia (NVDA:) posted a profit that more than doubled from a year ago. Shares of Disney fell 2.1%, while Nvidia was 1.5% higher.

Aside from earnings, traders had to focus on the latest batch of economic data. The Labor Department said that its import price index jumped 1.8% last month, well above expectations. At the same time, the Commerce Department said that the international trade balance unexpectedly narrowed to a deficit of $56.5 billion during September from a revised $56.8 billion in August.

Additionally, the University of Michigan said the November reading of its consumer sentiment index came in at a surprisingly low 75.0, the lowest level in two years.

Commodities were mixed. Crude was up 97 cents to $96.43 a barrel, gold was lower by 10 cents at $834.60 an ounce, and silver was off by 2 cents to $15.49 an ounce.

U.S. Treasuries were rallying, sinking yields. The 10-year note was rising 15/32 in price, yielding 4.22%. The 30-year bond was higher by 1-2/32 in price, yielding 4.60%. Not surprisingly, the dollar continued to slide against the euro.

Overseas markets were mostly lower. In Asia, Hong Kong's Hang Seng tacked on 0.1%, while Japan's Nikkei 225 slipped 1.2%. Among European bourses, London's FTSE 100 lost 1.3%, and the Paris CAC 40 fell 1.9%.

hi setravis:)

if we look at the weekly long term chart of the Dow we had a break! of the long term trendline. If we break 13000 it can get uglier on monday......

This week was very volatile. On Friday google tried to recover nicely up to 680 dollar 20 minutes before closing bears took it down to around 665. Monday will be interesting.  At the moment i am short in google, drys and long in wwat and bqi. The rest i have cash. 

More shorts for monday:

Macd Hist looks weak = bearish
Record Volume Friday on a down day and no reversal signs = bearish