Up, Up & Away

This was one of those days, seems like nothing could go wrong short of negative guidance. Dow was up 138, advancers over decliners 2-1 (seems like a lot more) & NAZ was up 24. NYSE volume approached 1.4B, up from 1.2B yesterday, not too bad. The VIX (volatility index) pulled back 1.87 to 21.18, high but not as extreme as in recent days.





While banks/financials dominated a lot of thinking, oil's drop of 3 bringing its recent decline of almost 20 is dramatic:

CLQ08.NYM	Crude Oil Aug 08	127.95 3:32pm ET	3.09 (2.36%)

Financials are leading the markets. The clearest example is Wachovia (WB) reporting a $9B loss, a little worse than expected. There is a belief that they have turned the corner because they are closing the mortgage business bought last year. WB shot up 3.61, don't see that to often. Troubled Washington Mutual (WM) reported an ugly loss, far worse than expected, but rose 34¢ (not bad for a $5 stock). All financials were flying today as shown in Bloomberg's S&P Financials Index. Maybe not all. The 3 negative reports after yesterday's close got hammered, including American Express (AXP):

S&P 500 FINANCIALS INDEX Value 296.60, UP 18.340, Change 6.6%

AAPL
162.02 down 4.27 (2.57%) 66,894,998

TXN
24.35 down 4.17 (14.62%) 74,038,510

AXP
37.99 down 2.91 (7.11%) 48,346,955


After hours Yahoo reported lower profits & sales below expectations, but the stock was little changed after declining 27¢ earlier.

This was one of those days when just about all problems were ignored (except for those mentioned above). The bulls are in charge with banks & financials giving them encouragement. Macro economic reports are due later this week. Let's see what they have to say.