Monday, June 23, 2008

Dreary news sends markets lower

Dreary news sent markets lower. Dow declined 14, decliners over advancers 3-2 & NAZ was down 16. The banking/financial sector of the Dow is being hit especially hard today. Goldman Sachs cut ratings for financials & consumer sectors, sending many of those stocks down 1. Oil rose 1.73 to 137 on news after the oil summit meeting in Jeddah, Saudi Arabia, this weekend. Markets were not impressed by Saudi's agreement to raise oil production 200K per day. Nigeria is another major source of oil & that situation remains iffy from day to day.

Citigroup (C), a Dow stock, is halfway though laying off 6500 staff members. Below is their chart showing a $50 stock for many years is now under 19 with dismal prospects for the div. This story is repeated for many banks:

Chart for Citigroup Inc. (C)

A Harvard study says that this housing slump is deeper than past ones & may take longer to straighten out. Nothing new. I think that's enough dreary news for the time being. Looks like markets will be testing their lows earlier this year, around 11½K for the Dow. Leaving on an up note, The Alerian MLP index is up 3 nearing the important 290 support level, probably on the "good news' for oil.

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