Monday, June 2, 2008

Ugly day for markets

This was another ugly day for the markets. A rally in the last hour reduced losses, but this was still a down day. Dow was down 134, decliners over advancers 2-1 & NAZ had an especially tough day, down 31. The biggest negative news, among many negatives, was the S&P downgrade of major financials including: Merrill Lynch (MER), Morgan Stanley (MS), Lehman(LEH) along with banks such as JP Morgan (JPM) & Bank of America (BAC). After a period of massive write-offs, S&P is not convinced the worst is over (i.e. more losses are ahead). All of these sold off 1-2%. In addition Washington Mutual (WM) & Wachovia (WB) after having very rough years dismissed their CEO's. The Sec of Commerce, Henry Paulson, in a speech given in Asia said it may be months before the (credit mess) turmoil ends. On the upside, MLPs did well, up 2. They benefited from favorable speculation at the beginning of hurricane season (which already produced it's first tropical storm closing 2 refineries in Mexico).

Oil was hanging around 128, at one point nearing 129 but closing at 127.64 up 29¢. These are times to test the best of investors. But they know this time should be used to study companies in preparation for future buying opportunities!

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