Friday, June 13, 2008

Prospect of stable rates sends stocks higher

Signals that the the FED may not raise rates this month sent stocks higher. Dow was up 102, advancers ahead of decliners 5-2 & NAZ was up 39. Today's inflation report was viewed as a positive. The Labor Dept reported the inflation rate for May was a high 0.6%, however the core rate was only 0.2% (in line with expectations). This is in contrast to recent signals from the FED about needing to raise interest rates for the fight against inflation. Oil dropped 1 to 135 on news from the OPEC meeting. OPEC said recent prices (i.e in the 130s) do not reflect realities. Duhhh!! Does this qualify as a news bulletin? Foreclosures in the US climbed 48% in May. One home in 483 received a foreclosure notice, the highest ratio since record keeping began 3 years ago. If record keeping went back further, it could be the highest in 20-30 years, whatever.

Lehman Bros (LEH), up 2.09, has a friend, BlackRock (BLK), up 6, which has invested in them & may be considering a larger investment. Their drama will continue to play out.

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