Early market losses trimmed in the afternoon

Banks led stocks on their way up in the last month & are leading the way down today. The Financial Index can't break thru the 138 close at the end of Jan, becoming a very important resistance level. Banks were hurt by a dose of reality, an analyst advised selling bank shares because gov measures to shore up banks may not help as much as expected & loan losses could exceed levels from the depression.

S&P 500 FINANCIALS INDEX

Value 127.11

Change -3.84

% Change -2.9%

Dow may be failing its first test of the 8K resistance level. After a decline in the AM, there were buyers late in the day cutting the loss & bringing the Dow within only 25 points of 8K. The Sun deal falling thru didn't help matters today. Dow slipped 41, decliners over advancers 2-1 & NAZ dropped 15. Looking at just the last week, Dow has been leveling off just under 8K in the last 3 trading days. The technical guys shouldn't like to see that.


Dow Jones Industrials --- 1 week




MLPs & REITs benefited from higher prices in the PM. The Alerian MLP Index & Dow Jones REIT Index each slipped 1. REITs have been strong in the last few days, they may get more attention from buyers searching for high yields. Oil pulled back another 1 to the 51s on the dismal economic outlook.


The Defense Dept is cutting back purchasing weapons systems. They feel the effects of budget tightening while pork projects receive more spending. Cutbacks in military spending will add unemployment to the rolls in coming months.

• Defense chief Gates proposes weapons cuts- AP

Alcoa (AA) earnings will be reported tomorrow, beginning earnings season. There is a lot of talk they will beat very lowered expectations which may give the stock & the markets a lift. For me, bad is bad whether or not it beats ever gloomier predictions.

I'll be in an out for the rest of the week, so postings won't be as regular. But I'm here & will be posting.