This was a very good day for many investments. Dow was up 186, advancers over decliners 2-1 but NAZ rose only 10. NYSE volume was just under 1½B, medium but not great on one of those rare days where stocks, led by banks & oils, each had good gains. The Bloomberg Financial index had was up, trying to get back to the 302 high last week. By way of comparison, its all time high was 482 last year:
S&P 500 FINANCIALS INDEX ........... 293.13 ....... up 5.76 ......... % Change ..... 2.0%
Oil had one of its best days in some time:
CLU08.NYM.....Crude Oil --- Sep 08 --- 127.01 --- up 4.82 (3.94%)
The weekly report had inventories decline over 3MM barrels, anything sets off this market. In sympathy, oil stocks rose sharply. Exxon (XOM) & Chevron (CVX), Dow stocks, each had gains over 3 ahead of their earnings reports in the next couple of days. The Alerian MLP index rose 6, one of its best days ever. One MLP I watch (on the right), Enbridge Energy Partners, was up 3 for the stock & over 2 for the units (probably its best day in history). This was fueled by buying ahead of distribution (99¢) at week's end. However, REITs pulled back on this otherwise up day.
Hard to say what got buyers all excited. The jobs report this AM was pretty good but it doesn't necessarily tie with the reports issued by the Dept of Labor, like the one due later this week. Oil should have been a downer, but not today. Banks are soaring, maybe buyers feel the moves by the FED will save troubled banks. The FED extends emergency measures & Pres Bush signed the housing bill.
Showing posts with label Bloomberg. Show all posts
Showing posts with label Bloomberg. Show all posts
Wednesday, July 30, 2008
Markets up on favorable reports
Dow is up 96, advancers ahead of decliners better than 2-1 & NAZ is up 9. Markets were encouraged by a favorable a private report showing the economy gained 9K jobs in June vs estimates of a 60K loss. As reported last night,the SEC is extending the new rules on short-selling. Pres Bush signed the housing bill helping 400K homeowners & Fannie Mae (FNM)/Freddie Mac (FRE). Oil continues to pull back, now it's below 122. Collectively these were taken as good signs for stock buyers.
S&P 500 FINANCIALS INDEX
Financials are cooling down, but are still having a nice day. In 1+ days, they're up 24. A leader, Bank of America (BAC), is up more than 1, even topped 34 on today's opening as shown in the 10 day chart:
While financials are doing well, REITs pulled back after yesterday's strong gains. The Alerian MLP index inched up to 266, remaining close to 262 support level. MLPs while not directly related to oil, they only move oil & gas around, seem to follow its lead. Most will be going ex-distribution (typically representing 2+% of the stock's price) in the next few days distorting raw numbers. Sadly junk bond funds still can't get no respect with their 12% yields.
More macro economic numbers are coming later this week. I think they will be giving gloomy signals. Oils will be reporting earnings in the next couple of days which should be record numbers. Bloomberg TV reported that hedge fund managers had a brutal (one of the worst ever) month after wrong bets. If true, prepare for big stock price swings when they try to even out positions.
S&P 500 FINANCIALS INDEX
| Value 290.30 | Change up 2.93 | % Change up 1.02% |
Financials are cooling down, but are still having a nice day. In 1+ days, they're up 24. A leader, Bank of America (BAC), is up more than 1, even topped 34 on today's opening as shown in the 10 day chart:
While financials are doing well, REITs pulled back after yesterday's strong gains. The Alerian MLP index inched up to 266, remaining close to 262 support level. MLPs while not directly related to oil, they only move oil & gas around, seem to follow its lead. Most will be going ex-distribution (typically representing 2+% of the stock's price) in the next few days distorting raw numbers. Sadly junk bond funds still can't get no respect with their 12% yields.
More macro economic numbers are coming later this week. I think they will be giving gloomy signals. Oils will be reporting earnings in the next couple of days which should be record numbers. Bloomberg TV reported that hedge fund managers had a brutal (one of the worst ever) month after wrong bets. If true, prepare for big stock price swings when they try to even out positions.
Monday, July 28, 2008
No let-up in selling
Markets continue to slide in Asia/Australia. Each market is down 2-3%, very bleak. The announcement by Merrill Lynch after hours about needing more capital (after selling their Bloomberg stake for $4B a couple of days ago) & many prior announcements that they would not need more capital is being questioned in Asia trading. Merrill Lynch is taking another big write-off & will seek an additional $8½B. The end of the credit crisis does not look to be near.
Dow Down, Down, Down
Another ugly day in the markets. Dow tumbled 239, decliners over advancers 5-2 & NAZ fell 46. The S&P 500 is back to 1234, below what some thought was an important support level of 1270. NYSE volume was under 1.2B, very low signally nothing was decided. This is bleeding & it will continue. Banks/financials led the way down. The 4 financials of the Dow accounted for 50 points of the decline. The S&P 500 FINANCIALS INDEX (on Bloomberg.com) dropped 12 to 265 (5 days ago it was at an interim high of 302).
Nothing really new other than dreariness & realization that ugly days lie ahead for financials. The write-offs at 2 Australian banks didn't help. Sec of Treasury, Henry Paulson, said major banks will start a new lending program. The country's 4 biggest banks will issue covered bonds to help the ailing mortgage market. While this is done in Europe, it's new to the US. There may be a fair amount of scepticism, maybe this is just another way to batch loans together but may not achieve the desired results of helping banks. Meanwhile oil neared 125, up 1.47, on the usual assortment of supply problems. Today they are in Nigeria.
Economists in the White House reduced their forecast for economic growth in the US.
----------- original------- revised
2008.......2.7%..............1.6%
2009.......3.0%..............2.2%
Unemployment rates will tick up, not encouraging. The economy will be struggling for some time, the kind of news investors don't like to hear.
Nothing really new other than dreariness & realization that ugly days lie ahead for financials. The write-offs at 2 Australian banks didn't help. Sec of Treasury, Henry Paulson, said major banks will start a new lending program. The country's 4 biggest banks will issue covered bonds to help the ailing mortgage market. While this is done in Europe, it's new to the US. There may be a fair amount of scepticism, maybe this is just another way to batch loans together but may not achieve the desired results of helping banks. Meanwhile oil neared 125, up 1.47, on the usual assortment of supply problems. Today they are in Nigeria.
Economists in the White House reduced their forecast for economic growth in the US.
----------- original------- revised
2008.......2.7%..............1.6%
2009.......3.0%..............2.2%
Unemployment rates will tick up, not encouraging. The economy will be struggling for some time, the kind of news investors don't like to hear.
Tuesday, July 22, 2008
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:
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.
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 | 3.09 (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.
Sunday, July 20, 2008
Wild, wild week!
Stock markets, highlighted by financial stocks, just went thru a major sell-off followed by a sharp rally in the last few trading days. Financial stocks got the most attention, even more than energy & energy stocks. This year, they've gone from one new low to another with seemingly no end.
The S&P Financials Index, shown on Bloomberg (their symbol for it is S5FINL), went from a high of 510 in May 2007 to a low of 230 last week (more than a 50% decline) followed by a sharp rebound to 280 Fri. The moves are similar to Bank of America (BAC) stock performance even though its had more exaggerated moves, shown below (note high volume recently):
Banks have gone thru a lot, especially this year, mostly negative news stories. All major banks operate under a dark cloud which varies from one to the next, but each one has a cloud overhead. A week ago, the banking system had its first failure in what must be at least 20 years. There haven't been any (or many) because a large bank was always available to take over the weak one, then life went on. That concept is barely alive today. The FNM/FNM situation & confusion about their survivability during the credit crisis adds to uncertainty for financials. That's been a lot for investors, whether experienced or novices, to absorb causing wild swings on big volume.
Meanwhile, economic problems drone on. In 1980, the economy had to deal huge numbers for inflation & unemployment while contracting. The combination of events was called stagflation, all economic measures were going wrong. The world is not as ugly today. By comparison, inflation & unemployment are more moderate while the economy is eaking out growth. However, they're ugly enough to drag down markets this year & looks like these conditions will continue.
The depression in housing & autos affects a lot of businesses & workers. Masco (MAS), another member of S&P Dividend Aristocrat list, will eak out their 50th consecutive annual div increase this year (by one penny). If continued, Q4 will be above the prior year by that penny. But they indicate earnings will not cover the current div. Remaining on the list next year is unclear. It will be sad if they are forced to break their 50 year track record next year. While this is just one small story among a great many, it's indicative of tough times the economy is going thru causing stocks to sell off in 2008.
I haven't seen the extreme fraidy cat lately, the black one living most of his life under the futon or in a closet. Maybe that's his way of saying we should be cautious, at best, going forward. More earnings reports will be issued this week including BAC on Mon. By weekend, they will announce the next div (the one they traditionally increase). If earnings are less bad then dreaded, chances are they will have an increase even if it's limited. The earliest signals for this week are the New Zealand market opened higher & pre-trading for Australian stocks is showing a 1% increase suggesting markets will start on a positive note.
The S&P Financials Index, shown on Bloomberg (their symbol for it is S5FINL), went from a high of 510 in May 2007 to a low of 230 last week (more than a 50% decline) followed by a sharp rebound to 280 Fri. The moves are similar to Bank of America (BAC) stock performance even though its had more exaggerated moves, shown below (note high volume recently):
BAC stock has done well, from the 20s in the early part of the decade to the 50s last year. As a member of the S&P 500 Dividend Aristocrat list, BAC had yearly increases with a nice one 12 months ago. Since the peak in early 2007, it had a slow & then a sharp drop to last week's low of 18½ where the stock yielded almost 14% (for those who believed in the div). The 3 day rebound brought the stock back to the what had been a “new low” price reached a month ago. The rebound came on high volume as show below:
Banks have gone thru a lot, especially this year, mostly negative news stories. All major banks operate under a dark cloud which varies from one to the next, but each one has a cloud overhead. A week ago, the banking system had its first failure in what must be at least 20 years. There haven't been any (or many) because a large bank was always available to take over the weak one, then life went on. That concept is barely alive today. The FNM/FNM situation & confusion about their survivability during the credit crisis adds to uncertainty for financials. That's been a lot for investors, whether experienced or novices, to absorb causing wild swings on big volume.
Meanwhile, economic problems drone on. In 1980, the economy had to deal huge numbers for inflation & unemployment while contracting. The combination of events was called stagflation, all economic measures were going wrong. The world is not as ugly today. By comparison, inflation & unemployment are more moderate while the economy is eaking out growth. However, they're ugly enough to drag down markets this year & looks like these conditions will continue.
The depression in housing & autos affects a lot of businesses & workers. Masco (MAS), another member of S&P Dividend Aristocrat list, will eak out their 50th consecutive annual div increase this year (by one penny). If continued, Q4 will be above the prior year by that penny. But they indicate earnings will not cover the current div. Remaining on the list next year is unclear. It will be sad if they are forced to break their 50 year track record next year. While this is just one small story among a great many, it's indicative of tough times the economy is going thru causing stocks to sell off in 2008.
I haven't seen the extreme fraidy cat lately, the black one living most of his life under the futon or in a closet. Maybe that's his way of saying we should be cautious, at best, going forward. More earnings reports will be issued this week including BAC on Mon. By weekend, they will announce the next div (the one they traditionally increase). If earnings are less bad then dreaded, chances are they will have an increase even if it's limited. The earliest signals for this week are the New Zealand market opened higher & pre-trading for Australian stocks is showing a 1% increase suggesting markets will start on a positive note.
Tuesday, July 15, 2008
Worries, worries, worries!!
Worries are overwhelming the traders. It's difficult to keep track of all the banks, especially big ones, selling for 5 (that's $5 per share). The Bloomberg chart from yesterday (below) shows Dow is down 133 (off the lows of down more than 200), decliners ahead of advancers 9-1 (don't see that too often) while NAZ is down 21. S&P 500 is down to 1211, former important lines of support are now history! Banks & related financials are leading today's plunge. FED Chairman Bernanke is testifying trying to explain what's happening with banks & what to expect going forward. The FDIC said bank deposits are safe. They better be, but a nervous public needs reassurance. One tiny glimmer of optimism is First Horizon (FHN), now a $5 stock, was up today. For those who want to read more about bank worries, read on. This financial mess will just have to play out, keeping the powder dry seems to be a good tactic for the time being.
There is corp news. Retail sales inched up 0.1% in June, no great surprise. Going forward, help from tax rebates is pretty much over. JNJ (JNJ), a Dow stock & member of the S&P Dividend Aristocrat list, is up 1.28 on a favorable earnings report. But Kimberly Clark (KMB), another member of that elite div list, is down after cutting guidance which brought downgrades for the stock. General Motors (GM), another Dow stock, eliminated the div, is laying off workers & cutting truck production to help preserve cash.
On this gloomy day it's good to keep in mind investment ideas for buying beaten up stocks, better times are coming. We all need to be reminded.
Monday, July 14, 2008
Federal Reserve announcement leads to gloom
The Federal Reserve announcement yesterday trying to prop up Fannie Mae (FNM) & Freddie Mac (FRE) led to gloom in the markets. In pre-trading the Dow was up 150 based on seat of the pants enthusiasm but fell to a small gain at the open & has been selling off since then (check the chart below courtesy of Bloomberg): It's showing down 51, decliners ahead of advancers 2-1 & NAZ is down 26. S&P 500, down 11 to 1228, is in scary territory for technicians.
FRE saw strong demand this morning selling $3B in bills, an encouraging sign. But this is a very gloomy time for the GSEs, not to mention for many others. Banks are getting hammered again. There are a bunch (WM, NCC, FHN), used to be nice div guys, are now selling around 3, 4, 5, whatever. Last year, collecting their dividends was considered routine. Also the FED & banks have to clean up bleeding from the IndyMAc failure on Fri. The credit crisis has become an ugly mess that is not going away quickly no matter what the FED or gov does.
Back to the rest of the world. Oil is kicking around 145 up about 50¢ for the usual assortment of reasons (strong dollar & supply uncertainties). AAA reported gas averaged 4.11 yesterday. High priced gas is going to hurt retailers as the important back to school selling mini-season approaches. Hang on for another rough day in the markets.
FRE saw strong demand this morning selling $3B in bills, an encouraging sign. But this is a very gloomy time for the GSEs, not to mention for many others. Banks are getting hammered again. There are a bunch (WM, NCC, FHN), used to be nice div guys, are now selling around 3, 4, 5, whatever. Last year, collecting their dividends was considered routine. Also the FED & banks have to clean up bleeding from the IndyMAc failure on Fri. The credit crisis has become an ugly mess that is not going away quickly no matter what the FED or gov does.
Back to the rest of the world. Oil is kicking around 145 up about 50¢ for the usual assortment of reasons (strong dollar & supply uncertainties). AAA reported gas averaged 4.11 yesterday. High priced gas is going to hurt retailers as the important back to school selling mini-season approaches. Hang on for another rough day in the markets.
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