STOCK MARKET WATCH, Monday 23 May

[ozymandius]

Monday May 23, 2005

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 3 YEARS, 243 DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 4 YEARS, 155 DAYS
WHERE'S OSAMA BIN-LADEN? 3 YEARS, 218 DAYS
DAYS SINCE ENRON COLLAPSE = 1275
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 2
Other Arrests of Execs = 54


U.S. FUTURES & MARKETS INDICATORS
NASDAQ FUTURES-----------------------------S&P FUTURES




AT THE CLOSING BELL WHEN BUSH TOOK OFFICE on January 22, 2001
Dow - 10,578.24
Nasdaq - 2,757.91
S&P 500 - 1,342.90

AT THE CLOSING BELL ON May 20, 2005

Dow... 10,471.91 -21.28 (-0.20%)
Nasdaq... 2,046.42 +3.84 (+0.19%)
S&P 500... 1,189.28 -1.80 (-0.15%)
10-Yr Bond... 4.13% +0.02 (+0.41%)
Gold future... 417.70 -3.10 (-0.74%)

GOLD, EURO, YEN, Dollars and Loonie




PIEHOLE ALERT

Heads Up!
Preliminary info on appearances by Bush & Co. throughout the country. Details & links are added as they become available so check back. And if you know more, are organizing something, or would like to, contact [e-mail]

For information on protests and other actions Citizens For Legitimate Government

[UpInArms]

1. daily dollar watch

http://quotes.ino.com/chart/?s=NYBOT_DXY0

Last trade 86.59 Change -0.04 (-0.05%)

Dollar Rallies on Razor Sharp Accuracy of SSI

http://www.dailyfx.com/index.php?option=com_content&task=view&id=1184&Itemid=39

US Dollar
For a day absent of any US economic data, it sure has been a wild ride in the dollar. The catalyst for the dollar’s sharp rally at the onset of the US trading session was primarily flow-based movements as traders try to take a stab at the key 1.25 level. In fact, the FXCM Speculative Sentiment index that we released yesterday confirms that the move was flow based. The razor sharp accuracy of our “flip in the ratio” signal manifested yesterday in USDCHF. In our report, we had said that even though the flip in the ratio was marginal, the fact that bears have gained control of the currency pair suggests that (as a contrarian indicator) we should see further gains in USDCHF. This is exactly what happened, the dollar ended up rallying 150 pips against the Swiss franc. With positioning in the euro, we used the USDCHF data as supporting evidence that the euro may not have reached a bottom, which is what we saw today. Meanwhile, Federal Reserve Chairman Alan Greenspan was on the speaking calendar at the Economic Club of NY talking about a variety of current market topics including energy prices, China and the housing market. On energy prices, the mighty chairman confirmed our belief that energy prices “remain central” to the economy’s health and for us, that means the health of the US dollar. He believes that oil prices will probably continue to recede with continued “inventory accumulation.” On the issue of China, Greenspan said that, “something has to move” but also added that revaluation is unlikely to lower the US’ trade balance. In regards to the housing market, he doesn’t believe that there is a national bubble but he does see the price acceleration as an unsustainable underlying pattern. Overall, we didn’t learn anything new. When asked the number one question in the minds of traders, that is “what is the neutral rate,” Greenspan skirted the question and said that the neutral rate is an “amorphous concept.”

Euro
Weak economic data from the Eurozone may have given dollar bulls a reason to send the single currency out for another round of beating. French GDP growth slowed markedly in the first quarter, rising a paltry 0.2% from a downwardly revised 0.7% in the fourth quarter. High unemployment has crimped consumer spending, causing public consumption to be a main drag on overall growth. Italian industrial orders also plunged 1.7% in March, confirming that France is not the only country in the region to be experiencing deteriorating growth. This will continue to refrain the ECB from raising rates anytime soon. As recently as today, ECB member Mersch echoed the central bank’s belief that interest rate remain appropriate.

<snip>

Japanese Yen
The Japanese yen was taken along for a slide today as dollar bulls bid up the currency despite the dearth of US economic news. As for news from Japan, the most significant was the release of the Bank of Japan’s minutes from this month’s monetary policy meeting. Again the reserve target was set at the 30 to 35 trillion yen range. However, this month’s statement changed in its stance that if liquidity demand falls short of expectations, the actual balance would be allowed to fall below this target temporarily. What the Bank is essentially saying is that they will accommodate liquidity demand fluctuations and keep the nominal interest rate close to zero while excess liquidity will not be allowed to flood the markets. Incidentally, the actual minutes from the meeting reflected a more positive outlook from the central bankers. Whereas industrial production was regarded as flat in April’s minutes, they are now seen as “increasing gradually” while business fixed investment, especially in manufacturing, are now on a “rising trend” due to higher profits. On the always important issue of inflation, the monetary authorities now expect corporate goods prices to continue increasing for the time being, but at a slower pace, possibly due to the recent downturn in crude oil prices while consumer prices remain on a downward path. This sense of improvement can also be seen in today’s convenience stores sales data as it improved from last month’s -1.4% with a lower rate of -0.9% in April. This is the second month in a row that the pace of the decline slowed. Meanwhile, China made a blockbuster announcement that they plan on raising their export tariff on low-cost clothing and textile products starting June 1st. With the recent pressure on China to revalue their currency, the government has chosen to raise taxes or tariffs on exports in hopes of cooling some of the recent trade tensions between the US and EU and to ideally head off the US’ own plans to reinstate some quotas on Chinese imports. We doubt that this measure is enough for the US to step away from the call for revaluation – expect this to continue to be a big topic in the markets over the next few weeks.

...more...

Dollar Prepares For Countermove By Majors

http://www.dailyfx.com/index.php?option=com_content&task=view&id=1193&Itemid=39

EUR/USD – Euro bulls remained under pressure after the dollar longs renewed their attack against the single currency positions following the failure by the euro bulls to recapture the 1.2600 figure. As euro longs get ready to defend their territory against the greenback invasion, they will rely on a minor support at 1.2495, a Feb 20 daily spike low. An intermediate support at 1.2460, a July 16 high, currently defends the major support at 1.2389, an Aug 17 daily spike high from the incursions by the dollar longs. In case euro bulls retaliate, their initial advance will encounter a minor resistance at 1.2631, a 61.8 Fib of the 1.1991-1.3667 euro rally. A move deeper in the dollar held territory will meet an intermediate resistance at 1.2682, a 10-day SMA, with a sustained breakout testing the offers at 1.2730, a Feb 7 daily spike low. Oscillators are aligned. Stochastic is extremely oversold on the daily chart at 9.22 and is oversold at 13.83 on the dealer (4HR) chart. RSI is dipping below the oversold line on the daily chart at 25.74 and is treading above the oversold line at 36.58 on the 4-hour chart. MACD remains below zero line on the daily chart and is made a bearish crossover below the zero on the dealer (4HR) chart.

<snip>

USD/JPY – Yen bulls continued to retreat after the dollar forces pushed the pair above the 108.00 figure. As the yen longs remain under the constant pressure from the greenback bulls, advancing dollar longs will meet minor resistance at 108.47, an Apr 12 daily spike low. A move further will most likely see the vanguard greenback forces meeting an intermediate resistance at 1008.88, a 2005 high, with a sustained breakout aiming at 109.43, a major resistance created by the July 26 daily spike high. As dollar forces get ready to battle over the 108.00 figure, they will rely on a minor support at 107.44, a 5-day SMA, with intermediate support currently seen at 107.08, a 61.8 Fib of the 108.88-104.16 yen rally. Major support remains intact at 106.52, a 50.0 Fib of the Apr-May bull swing. Indicators are aligned. Stochastic is overbought on both the daily chart at 86.88 and at 87.13 on the dealer (4HR) chart. RSI is overbought on the daily chart at 70.21 and is dipping below the overbought line at 66.16 on the 4-hour chart. MACD crossing above the zero line on the daily chart and continues to tread above the zero line on the dealer (4HR) chart.

...more...

Have a Great Day Marketeers!

[converted_democrat]

4. Hello UpInArms!!

Good morning to you. :hi:

[UpInArms]

7. Hi Ho converted_democrat!

Glad to see you this bright and shiny Monday morning :hi:

[AnneD]

13. Morning Marketeers

:donut: Can I opine at the watercooler for a minute. I have been a bit puzzled at this obsession about privatizing Social Security. I have followed this intensly as I am 50 and would be on the first wave of those experiencing this change. All calculations I have tried have shown me at way less under the new system vs the current plan. We all know that successful investment is capital + time (compounding). Now at 50 I have a 15 year window to contribute into my 403B. Now the market has not been doing well and is not my investment of choice at the moment. I spoke to an investment person (I suspect he make the money in stock mutual funds-you'll see why) and when I asked him about IRA (I am thinking of post-tax investment at todays low rate 'cause I know the tax rate will go up due to deficit), he said that the Roths were new and still subject to sunset review.
So how does this connect with SS privitization and why am I so pissed/opposed to privitization. Well, you have to start drawing in out when you reach 70. At that point, you are REQUIRED to take money out. The first of the boomers (that have had to use defined contribution retirement plans like 401 as opposed to defined benefits such as pensions) turn 70 in 2016 then will jump dramatically each succceding year as more Boomers hit 70.
Now, here we have a bunch of people that HAVE to sell in a rapid sucession. How much damage can alot of forced sales do to the market? Enter the privatization of SS. By requiring everyone esp young workers to divert money into the market, it might stave off a collapse. Hmmmmmm, hasn't the Bush admin been bandying about a 2015+ year for SS collapse. Well something might collapse but I don't think it is SS.
OK those were my deep thoughts about SS (and the push to privitize), retirement and the market. Is my brain to feverish and I need to pack it in ice, or do I have a valid concern?????? Spitballing welcome as always. Whachathink.
Happy hunting, and watch out for the bears.

[converted_democrat]

14. Well...

:hi: Good morning Anne. I do not know nearly as much about this stuff as UIA, Ozzy, 54, or Raw, but I have thought that same thing for sometime. It seems to me like they are trying to further prop the market. Either that, or Bush is such a spoiled brat that he really feels he has to get way. Almost everything he has done in the past has had some financial ulterior motive, so I think your idea is very likely.

[UpInArms]

16. Morning AnneD!

You are probably very close in your assessment of the situation. With this mal-administration, if past mirrors present, everything that they "say" has very little to do with the motive behind their agenda.

Saving SS/Clean Air/Leave No Child Behind, etc.

If you take it apart, there are probably many supporting legs on the table - channeling $$$ into their cronies' pockets, setting the support system of this country on fire, working on the feudal/serf endgame?

What you can bet the farm on is that whatever their goal actually is, will not be in the best interest of the average citizen or future retiree.

:hi:

[54anickel]

25. No guarantee indexing to prices will do much good for Social Security

More smoke & mirrors and a glimpse at the reason for changing the indexing of SS.

http://www.chron.com/cs/CDA/ssistory.mpl/business/3192150

snip>

"On the heels of yesterday's announcements from United and Blockbuster, the public may suddenly become even more keenly aware of what has been happening for the past 40 years — top execs have been gleaning huge personal gains despite the dismal performance of the companies they lead; pension funds are almost all underfunded; more corporations will file for bankruptcy, sticking the public with the bill as we did in the S&L bailout; while Congress, under pressure from its financial institution contributors, has made it increasingly difficult for individuals, who may be the very victims of Enrons, to file for personal bankruptcy."

snip>

"I'm working part-time at a home furnishings store, which is making money because no one in any store other than the manager is a full-time employee with benefits. We work 15 hours a week in five-hour shifts, doing everything from unloading trucks, stocking shelves, selling the merchandise and toting tables, chairs and other heavy objects to customers' vehicles. I'm way too old for this, but I must buy groceries while I continue to look for a real job."

snip>

The benign assumption behind progressive indexing is simple. Index future benefits to prices rather than wages, and most of the $4 trillion revenue shortfall expected over the next 75 years will disappear.

snip>

According to the Department of Labor, average gross weekly earnings for private nonagricultural workers rose from $267.26 a week in 1982 to $536.17 a week in February 2005 — doubling in 23 years. The same figure, adjusted for the consumer price index for urban wage earners and clerical workers, otherwise known as CPI-W, rises from $267.26 to $276.95.

That's a purchasing power gain of $9.69 over two decades. In today's money, it's about enough to go to a movie if you don't eat much.

snip>

It's just possible that inflation-indexed benefits will rise faster than wage-indexed benefits in the future. It's possible that millions of part-time and temporary workers will have such uneven work lives that their wages will be flat or declining.

more...

[AnneD]

27. Thanks....

CD and UIA. Yeh, I don't have the diploma but I have been an investor since my mid 20's. I have gone through 2 market crashes and 1 layoff in a depressed economy (in which I had to retool and had to eat up my savings in the process) so I have a smidge of life experience. Even when I knew the tech bubble was/had popped, I still had a degree of trust in the market and cut Bush a bit of slack at the beginning of his term in reguard to the employement and economic outlook. HOWEVER, his choices, and the choices of his advisors (that I knew to be crooks) have absolutely soured me. Even saving on my weinney salary there is no way I can make up the difference in the potential loss of SS (current level vs privatized level). The one thing I have going for me is that I have one of those rare defined benefit retirement plans (read pension) that is fairly safe (unlike airline pensions )-I work for the State (Texas Teachers Retirement System) and I have enough quarters for SS. I was planning on pension+SS (a sm amt due to pension)+investments, so I am in a better place than most but my investments have taken a beating and they want to take away that last safety net I or many others may have. They are screwing the wrong age group...we aren't called the Baby Boom for nothing. Yeltsin is having problems with his pensioners now-in the US, whomever is in office will have it worse. Repubs are so screwed on this issue. And 54 I didn't even GET into indexing. Just another way to be screwed out of more money.

[54anickel]

21. Japan and China Stop Buying US Debt

edit to add link
http://www.kitcocasey.com/displayArticle.php?id=116

Some argue that catastrophe can’t happen. These optimists point out that the foreigners who have loaned us the dollars to maintain our life style, are freely doing so and are now locked in a deadly embrace where they would hurt themselves if they don't continue extending us credit. (I‘m not so sure, but I’ll get to that later.) They go on to point out that the situation is almost like the Mutual Assured Destruction of the cold war, where the Soviets and the US were deterred by the prospect of world destruction; neither side would initiate all-out attack on the other, because the result would be worse for everyone.

The problem for the Japanese and Chinese is that they hold so much of our debt that if they tried to cash it in (sell off their holding of US Treasuries) they would drive Treasuries down, interest rates up, the dollar down and be left holding big losses on their balance sheets. The proponents of this status quo like to talk about how owing the bank $100 is my problem, but owing the bank $1 million becomes the bank’s problem. Again, I question that conclusion.

Let’s look at the numbers: Japan has $700B of accumulated Treasuries, and China $200B. They could afford to let them crumble to worthlessness because these levels of losses could be absorbed by these economies. On a relative basis the damage to the US would be worse. That is not a likely course, but it should be providing fear as an overhang to the value of the dollar. It is more likely that they will keep the flow supported at some level because they want to continue to keep their workforce busy producing goods for us for trade. That is a bigger deterrent to their pulling out of the vendor finance program than the potential loss on their Treasury holdings.

All that background is to set the stage as to why looking at the details of this imbalance of trade is so important. The imbalance has not produced disaster because of how the foreigners have handled our deficits. So key to predicting the future is to determine if there is any change in the Vendor Financing policies of our foreign partners. So, I now turn to reading the tea leaves of the latest cross-border flows to see what is unfolding.

snip>



snip>

There is another shift in the composition of the purchases of Treasuries: Central Banks are buying less and the rest of the public is buying more. In the month of March the central banks actually sold off $15B from their holdings, which was the second highest rate ever. The only bigger month was during the Russian default and the LTCM collapse of August 1998. This shift is also consistent with the halt in Chinese and Japanese purchases, as they use official institutions to carry out their actions.

more...

[UpInArms]

24. Look at the Pirates of the Caribbean snap up those dollars! .. n/t

[UpInArms]

26. Dollar dips against euro, yen

China's Wu: No timetable for yuan revaluation

http://www.marketwatch.com/news/story.asp?guid=%7BAECD8A7B%2DCB98%2D4B4A%2D9D9A%2DBFD5F58A2ED2%7D&siteid=mktw

NEW YORK (MarketWatch) -- The dollar retreated below multi-month highs at midday Monday, as currency markets mulled a number of political developments which could imperil the euro.

In recent trades the euro was up 0.05% at $1.2557, after the dollar struck a seven-month high against the single currency late Friday. The dollar was down 0.3% at 107.81 yen.

With no U.S. economic reports scheduled for release Monday, currency market players turned their attention to events overseas.

The French daily Liberation Monday reported that 52% of French voters are expected to reject the referendum on the European constitution to be held next Sunday

Currency markets also tracked reports from Holland indicating that an even larger number of Dutch voters may reject a similar referendum on the constitution on June 1.

...more...

Last trade 86.45 Change -0.18 (-0.21%)

Settle 86.63 Settle Time 23:33

Open 86.54 Previous Close 86.63

High 86.71 Low 86.28

Last tick: 2005-05-23 11:53:14 ET
30-min delayed quote.

[UpInArms]

2. The yuan diversion

The yuan diversion

http://www.iht.com/articles/2005/05/22/opinion/edyuan.php

The get-tough-on-China talk got tougher last week when Treasury Secretary John Snow announced that China risks being branded a currency manipulator - and thus subject to sanctions - unless it acts soon to increase the fixed exchange rate between its currency, the yuan, and the U.S. dollar.

<snip>

Focusing on the yuan also deflects the blame for America's role in promoting global imbalances. Snow has acknowledged that the United States' federal budget deficit distorts global trade and investment. But, incredibly, he has also said that the United States is "aggressively tackling" its deficit with "appropriate fiscal policy."

That statement might be valid if President George W. Bush and his congressional allies gave up their drive to extend Bush's first-term tax cuts permanently or if Bush abandoned his plan to borrow trillions of dollars to privatize Social Security. But no such reversals are in sight. Contrary to Snow's assertion, then, the United States is not "doing its part" to address global imbalances.

Washington relies greatly on China for the funds to finance its deficits. Rather than positioning itself as China's adversary, it would be wise for America to cooperate, starting with honest discussion.

...more at link...

[ozymandius]

3. Today's WrapUp by Tim W. Wood

THE DOW REPORT
Lessons from the Past

As a market historian, it is my belief that if we study the markets of the past, we can gain valuable insight into the future. If you think about it, how can you judge a given situation if you have never been exposed to it before? So, it’s logical to me that we can gain our experience in one of two ways. We can learn from the school of hard knocks and let unfamiliar situations teach us the hard way, or we can learn from history. Both Dow theory and cycle analysis are really nothing more than studies of past market behavior. Then, when we see a similar behavior we have some indication as to the outcome of that setup based on the market history of the past. Basically, this is a means of “profiling” the market.

However, simply studying the past is not exactly the same as first hand experience and as we all know, history does not repeat itself exactly. But, it does repeat in a general sense and I would much rather be armed with the lessons of the past than not. Also, if you think about it, our formal education is really nothing more than the study of history. Our teachers taught us to be the engineer, doctor, accountant, lawyer, carpenter, mechanic or whatever, largely through the study of history. The engineer learns design structure through the experience of his predecessors. The doctor is taught based on analytical and diagnostic principles that were learned and developed by his predecessors as well. The lawyer studies case law and so forth. If you think about it, a large part of any profession is learned through the study of history. Yet, it seems that most participants in the market make very little, if any, study of market history. You often hear people say that they think this or that about a particular market, but it is rarely ever based on any serious study. People will spend years learning a skill or getting an education, but are generally unwilling to make much of an effort to truly study the markets and prepare themselves properly as investors.

-cut-

On October 23, 1929, William Peter Hamilton saw that the bear market had been signaled. The next business day, Hamilton wrote his famous editorial about that signal in the Wall Street Journal entitled A Turn In The Tide. On May 27, 1933 Robert Rhea wrote that the new bull market had been confirmed. These guys were able to make these calls because they knew market history and as a result, they knew what the turning point looked like.

Now, I’m not saying that just because I’m a market historian that I have all the answers. What I am saying is that history is our best teacher and in believing that, I have not limited my study of the averages to recent history. I have analyzed the markets from 1896 to present and as a result, I feel fairly confident that the Dow theory will once again hold true.

more...

http://financialsense.com/Market/wrapup.htm

[ozymandius]

5. pre- pre-open blather

8:30AM: S&P futures vs fair value: -0.8. Nasdaq futures vs fair value: -0.8. Still shaping up to be a lackluster open for the indices, as futures indications continue to vacillate around the unchanged mark... Ongoing pressure on oil prices, however, could arguably provide some early support while reports indicating that Apple Computer (AAPL) might consider using Intel (INTC) chips have helped shares of both tech companies surge in the early going

8:00AM: S&P futures vs fair value: -0.8. Nasdaq futures vs fair value: -0.8. Futures market versus fair value suggesting a flat open for the cash market... With no major economic data and very little in the way of corporate news to digest - following the best weekly advance for the major indices in at least six months - investors have so far been reluctant to show much follow-through interest in pre-market trading

[UpInArms]

11. later pre-opening blather

briefing.com

9:15AM: S&P futures vs fair value: -0.8. Nasdaq futures vs fair value: -0.8.

9:00AM: S&P futures vs fair value: -0.8. Nasdaq futures vs fair value: -0.8. No real change in sentiment as the futures market continues to trade close to fair value, setting the stage for stocks to open on a flat note... Shares of Campbell Soup (CPB) have surged following better than expected Q3 earnings while BMC Software (BMC) has also caught an early bid after reaffirming its Q4 outlook and issuing upside FY06 guidance... Companies in focus this morning after being upgraded include WMB, CIEN, PIXR, ETN, STA and MFE

ino.com

The June NASDAQ 100 was slightly lower overnight due to light profit taking as it consolidates above the 50% retracement level of this year's rally crossing near 1524.54. Stochastics and the RSI are bullish but overbought hinting that a short-term top might be in or is near. If June extends this month's rally, the 62% retracement level of this year's decline crossing at 1554.62 is the next upside target. Closes below the 10-day moving average crossing at 1491.75 would signal that the short covering rally off April's low has come to an end. The June NASDAQ 100 was down 1.00 pts. at 1529.50 as of 6:05 AM ET. Overnight action sets the stage for a steady to lower opening by the NASDAQ composite index later this morning.

The June S&P 500 index was slightly higher overnight as it consolidates above the 50% retracement level of this year's decline crossing at 1186.60. Stochastics and the RSI are bullish but overbought hinting that a short-term top might be in or is near. If June extends last week's rally, the 62% retracement level of the March-April decline crossing at 1196.54 is the next upside target. Closes below the 20-day moving average crossing at 1169.90 would confirm that a short-term top has been posted. The June S&P 500 Index was up 0.80 pts. at 1191 as of 6:07 AM ET. Overnight action sets the stage for a steady to higher opening when the day session begins later this morning.

[ozymandius]

6. Oil Prices Weak on U.S. Inventory Boost

Oil Prices Lose Ground on Boost in U.S. Inventories; Analysts Say Market Set for Turnaround

VIENNA, Austria (AP) -- Crude oil futures lost ground Monday, driven by better-than-expected increases in U.S. inventories and OPEC comments calculated to keep markets calm.

Still, analysts said that -- with prices now below what the Organization of Petroleum Exporting Countries sees as the acceptable upper bracket -- the market was set for a turnaround in the near future.

-cut-

Prices have been weighed down by a U.S. Department of Energy report that revealed a build of 334 million barrels in the previous week, the 13th increase in the past 14 weeks. Inventories are up 34 million barrels from a year ago, the highest since May 1999.

more...

http://biz.yahoo.com/ap/050523/oil_prices.html?.v=7

[UpInArms]

8. Treasury prices fall ahead of Fed speakers

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38495.3716403125-835791723&siteID=mktw&scid=0&doctype=806&

NEW YORK (MarketWatch) - Treasury prices weakened, pushing up yields, early Monday ahead of scheduled speeches by two Federal Reserve officials. Given a dearth of economic reports Monday, the Treasury market could trade in response to addresses by Philadelphia Federal Reserve President Anthony Santomero and the Chicago Fed's Michael Moskow. In recent trades the yield on the 10-year bond rose to 4.14% from 4.125% late Friday.

[UpInArms]

9. Able Labs fallout continues

8:54am 05/23/05 ABLE LABS SHARES DOWN 17.4% AT $5.94 PREMARKET

8:53am 05/23/05 ABLE LABS SAYS ACTIONS WILL MATERIALLY HURT EARNS

8:54am 05/23/05 ABLE LABS SAYS MAY NEED TO TAKE FURTHER ACTIONS

8:52am 05/23/05 ABLE LABS WITHDRAWS ABBREVIATED NDAS

8:53am 05/23/05 ALBE LABS NDA WITHDRAWAL DUE TO UNRELIABLE DATA

8:51am 05/23/05 TRIKON TECH GETS NASDAQ DELISTING NOTICE

8:52am 05/23/05 ABLE LABS SUSPENDS MANUFACTURING; RECALLS PRODUCT LINE

[UpInArms]

10. Able Labs recalls remainder of product line

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38495.382089294-835792364&siteID=mktw&scid=0&doctype=806&

BOSTON (MarketWatch) -- In the wake of last week's announcement that it was suspending all product shipments until further notice, generic drugmaker Able Laboratories (ABRX) said early Monday that it is recalling the remainder of it product line due to concerns over quality control. The drugmaker has been engaged in an on-going internal review of its manufacturing practises as the result of several other recent recalls. Shares of Able were down 18.5% to $5.86 on volume of 439,365 in pre-market trade.

[UpInArms]

12. 9:44 EST markets are open and blather

Dow 10,483.44 +11.53 (+0.11%)
Nasdaq 2,048.59 +2.17 (+0.11%)
S&P 500 1,189.64 +0.36 (+0.03%)
10-Yr Bond 4.103 -0.22 (-0.53%)

NYSE Volume 103,080,000
Nasdaq Volume 133,661,000

9:40AM: As futures indications suggested, the market opens in lackluster fashion, as investors find little in the way of market-moving data to extend this year's biggest weekly advance... While gains of at least 3.0% for the major averages last week - spurred by tame inflation data and falling oil prices - improved overall sentiment, the absence of noteworthy economic data and corporate news this morning has so far stalled much follow-through interest...

Perhaps the release of the FOMC minutes tomorrow afternoon (2:00 ET) can set a more definitive tone to what is anticipated to be a rather quiet week of trading heading into the Memorial Day weekend...

[UpInArms]

15. July crude tops $49 on the Nymex

http://www.marketwatch.com/news/newsfinder/pulseone.asp?dateid=38495.4583088889-835795219&siteID=mktw&scid=0&doctype=806&

DALLAS (MarketWatch) -- July crude added 50 cents to $49.15 a barrel Monday on the New York Mercantile Exchange, despite the existence of global crude inventories at their highest level in six years. "We're overdue for a corrective rally here," said Mike Fitzpatrick, energy analyst at Fimat. "I doubt it will get there, but you have risk to $53 from a technical perspective."

[ozymandius]

17. numbers and blather

11:21
Dow 10,503.09 +31.18 (+0.30%)
Nasdaq 2,048.87 +2.45 (+0.12%)
S&P 500 1,191.18 +1.90 (+0.16%)
10-Yr Bond 40.82 -0.43 (-1.04%)

NYSE Volume 545,229,000
Nasdaq Volume 623,073,000

11:00AM: Sellers show some resolve, as oil prices spike to session highs and the indices cling to modest gains... Crude oil futures, which have been weak most of the morning following a report that showed OPEC may boost production, have recently rebounded to $49.15/bbl (+$0.50), taking some of the steam out of early buying efforts... Oil prices were off 3.8% last week and are off more than 18% from an April 4 high of $59.94/bbl on the July contract... NYSE Adv/Dec 1923/1022, Nasdaq Adv/Dec 1577/1127

10:30AM: Major indices continue to trade at improved levels, as a rally in the Treasury market provides a floor of early buying support... Even though total bond volume remains lighter than usual, some technical factors have recently come into play to lift bonds across the board, knocking yields on the 10-year note (+11/32) down to 4.07% and subsequently improving borrowing costs for both consumers and corporations...NYSE Adv/Dec 1817/1010, Nasdaq Adv/Dec 1510/1067

[Mojorabbit]

18. wow!

Broke 10,500!

[Mojorabbit]

19. Experts Lower Projected 2005 Growth Rate

http://biz.yahoo.com/ap/050523/economic_outlook.html?.v=5
Experts Say Yawning U.S. Trade Deficit Probably Will Weigh Down Economic Growth in 2005

WASHINGTON (AP) -- The yawning U.S. trade deficit probably will weigh down economic growth this year, business economists say.

The economy, as measured by gross domestic product, is projected to expand by 3.4 percent in 2005, compared with an earlier estimate of 3.6 percent, according to the latest outlook from the National Association for Business Economics.

The lower forecast mostly reflects economists' beliefs that the trade picture will worsen. The U.S. trade deficit, which ballooned to a record $617 billion last year, is a politically sensitive subject for the Bush administration.

"Virtually the entire reduction in the panel's estimate of GDP growth in 2005 was due to a much deeper projected trade deficit of $662 billion this year," Carl Tannenbaum, who oversaw the survey, said in an interview

snip
One of the main reasons for the higher estimate is that economists' believe oil prices will hover around $46 a barrel this year, compared with an earlier estimate of about $40, Tannenbaum said.

Last year, consumer prices rose 3.3 percent, the most since 2000.

To keep inflation in check, the Federal Reserve probably will continue pushing short-term interest rates higher this year, the economists said.

[ozymandius]

20. From the good doctor, Atrios

atrios

source blog

link to article

Atrios says:

One of the interesting things about the consumer price index is that while one of its component prices is rental prices and owner-equivalent rents, it actually excludes actual home prices. This isn't an unreasonable approach generally, though it's apparently leading to some perverse results. The increased demand for home ownership both for primary residence and for rental property investment purposes has suppressed rental prices while home prices (in many markets) have been skyrocketing. So, the housing portion of the CPI may perversely being held down by an overheated housing market.

Crescenzi says:

"Surging housing demand appears to be continuing to reduce demand for rental units, weighing on the OER component of the CPI. Strength in housing demand is apparent in the recent data on mortgage applications for home purchases, wherein the four-week moving average is now at a record high, as well as the National Association of Homebuilders' latest housing market index, which in May reached its second-highest reading in five years. Meanwhile, rental income has fallen to about $147.8 billion from the peak of $186.6 billion in April 2002. When the housing market weakens, it will result in increased demand for rental units, hence boosting the OER portion of the CPI."

more...

[UpInArms]

22. 12:07 EST numbers and blather (happy days are here again!)

Dow 10,512.11 +40.20 (+0.38%)
Nasdaq 2,052.77 +6.35 (+0.31%)
S&P 500 1,192.53 +3.25 (+0.27%)
10-Yr Bond 4.077 -0.48 (-1.16%)

NYSE Volume 685,040,000
Nasdaq Volume 754,350,000

12:00PM: Market holds onto modest gains midday, as some of the momentum that helped the major averages enjoy their largest weekly advance of the year, carries over into today's market action... While there has been nothing in the way of notable economic data this morning, early buying interest has arguably been prompted by optimism surrounding tomorrow's FOMC minutes and a widely expected upward revision to Q1 GDP data later in the week...

A rally in Treasurys, as the benchmark 10-year note is up 12 ticks to yield 4.07%, has also helped underpin a modestly positive tone to trading, as seven out of ten economic sectors trade higher... Energy (+1.2%) has paced the way higher after a few notable names (i.e. XOM, CVX and COP) were reportedly upgraded to Outperform by Sanford Bernstein and amid a rebound in crude oil prices ($49.05/bbl +$0.50)... A weaker dollar has also provided support to the Materials sector (+0.4%) has also benefited from a declining greenback... Technology has also traded higher, as gains in Hardware and Software offset modest pressure in the Semiconductor space...

Hardware has surged amid reports that Apple Computer (AAPL 39.31 +1.76) might consider using Intel (INTC 26.39 +0.04) chips, Software has benefited from a sector upgrade from Goldman Sachs while modest profit-taking has weighed on chip stocks following last week's 4.0% advance on the PHLX Semi Index... Consumer Discretionary, as the Retail group extends last week's 6.6% surge, has shown relative strength while the Industrials sector has also traded higher, getting a boost from an analyst upgrade on Eaton (ETN 61.02 +1.66)... Interest-rate sensitive areas like Financial and Utility, however, continue to struggle, despite the rally in bonds...

[ozymandius]

29. Reminder: it's all hot air

12:36

Dow 10,512.92 +41.01 (+0.39%)
Nasdaq 2,054.50 +8.08 (+0.39%)
S&P 500 1,193.17 +3.89 (+0.33%)
10-Yr Bond 40.83 -0.42 (-1.02%)

NYSE Volume 779,859,000
Nasdaq Volume 836,594,00

[54anickel]

23. Conundrums:

At the end of the credit bubble bulletin

http://www.prudentbear.com/creditbubblebulletin.asp

After reading Bill Gross’s latest, I felt compelled to muster some type of response. I was even quick with a title – “The McCulleyzation of Mr. Gross.” I struggled with whether I would use “The Disappointing McCulleyzation…” While disheartened, I reminded myself that in these uncertain times everything needs to be kept in perspective. He has his job to do. Understandably, his top priority is performing for his bond investors.

Nonetheless, I do take it as evidence of our upside-down financial world that the universe’s largest bond manager buys into the notion of insufficient global demand and a Bernanke Fed chairmanship. Is the world’s largest economy not in the midst of an ill-fated consumption boom, with the most populated countries on earth – China and India – embark on an historic increase in domestic consumption (along with investment)? Then there is the issue of Dr. Bernanke as a dogmatic standard bearer for continued artificially low U.S. and global rates, an environment today deemed untouchable by the entrenched financial powers.

snip>

I have to this point disregarded “Bretton Woods Two” propaganda. The fanciful notion that the concomitant ballooning of U.S. current account deficits and Asian central bank dollar holdings comprise a stable and sustainable monetary regime reminded me too much of the convoluted New Paradigm metrics and “analysis” spawned during the late-‘90s manic technology circus. I am again reminded that there is a high correlation between the length of blow off periods and the capacity to relish nonsense. The current global currency arrangement evolved out of the necessity of managing escalating U.S. profligacy and the attendant precarious global financial flows. My notion is that Global Wildcat Finance is no more a lasting currency regime than wildcat banking was an enduring banking system. It works miraculously only while it works.

Many readers are likely familiar with Nouriel Roubini’s (of NYU) insightful work analyzing the U.S. Current Account. In his paper “The US as a Net Debtor: The Sustainability of the US External Imbalance” he points to “the scale of financial flows required to sustain the new “Bretton Woods Two” as the “Achilles heel.” According to Mr. Roubini’s cogent analysis, “…there are five reasons why this new regime will not prove to be stable. 1) Internal dislocation in the United States… Bretton Woods Two keeps U.S. interest rates below what they otherwise would be, helping interest rate sensitive sectors of the U.S. economy. However, the financing comes at the expense of import-competing sectors… 2) The strains placed on Europe… 3) The strains placed on China’s domestic financial system… 4) The financial risks associated with continuing to provide low-cost dollar denominated financing to the United States. Asian central banks are already taking an enormous financing risk by holding most of their reserves in dollar denominated assets… 5) Incentives to free ride and opt out of the cheap dollar financing cartel…”

I tend to lean toward the view that this strange global currency arrangement was fashioned more out of ad hoc urgency to manage destabilizing financial flows than an organized “cartel” to manipulate Asian currencies lower. What began with good intentions spiraled out-of-control right along with U.S. trade deficits. I thought the Financial Times’ Wednesday interview with Bank of Korea governor Park Seung was especially telling.

more...

[MARALE]

28. Stocks play 'follow the leader'

It all makes fundamental sense and the charts were cooperating -- bears seemed destined to be right.

Then all of a sudden, the Nasdaq Composite ($COMPQ: news, chart, profile) broke out to the upside last week, as a surging dollar and mixed economic data was keeping bond yields down and helping weigh down commodities prices. See previous column. Meanwhile, the economy continues to produce mixed data.

(Remember when a weak dollar used to be good for stocks?)

...

It's very difficult to project the next move when stocks are trading like the tip of a wagging tail. Perhaps the best strategy to avoid getting whipsawed is the one that says the market isn't expected to move at all.

...

It's not wrong to follow the signs that you are used to following, but it's wrong to keep following them if they stop working. Obviously, the market is not moving within its "normal" patterns, so you have to find an alternative driver.
...

http://www.marketwatch.com/news/story.asp?guid=%7BF396CCC5%2DB17D%2D41D2%2D8974%2D9E2B456D6E3B%7D&siteid=mktw&dist=

Morning all, Thought this was interesting.

[ozymandius]

30. 1:04 numbers et al

Dow 10,513.14 +41.23 (+0.39%)
Nasdaq 2,052.59 +6.17 (+0.30%)
S&P 500 1,192.43 +3.15 (+0.26%)
10-Yr Bond 40.86 -0.39 (-0.95%)

NYSE Volume 848,522,000
Nasdaq Volume 899,061,000

1:00PM: Little changed since the last update as the major averages continue to vacillate in roughly the same ranges... Meanwhile, Campbell Soup (CPB 30.75 +0.41) - this morning's only S&P 500 company out with quarterly results - has surged 1.3% after exceeding Q3 analysts' expectations by $0.02 and reaffirming FY05 guidance... Of the 475 S&P companies that have reported earnings, roughly 66% have turned in better than expected results versus the 14% and 20% of constituents that have matched and missed expectations, respectively...NYSE Adv/Dec 1975/1164, Nasdaq Adv/Dec 1593/1292

[MARALE]

31. Election hopes spark German stocks

http://www.marketwatch.com/news/story.asp?guid=%7B5BC6B7E1%2D61D4%2D47B5%2DB578%2D66495EBC90C4%7D&siteid=mktw&dist=

The Social Democratic-Green alliance scored only 43.3% of the vote in North Rhine-Westphalia, Germany's most populous state, compared to a 51% tally for the Christian Democratic Union, marking the first time in 39 years that a new government will be in place in the state.

Prior to Schroeder's announcement, an election was widely seen occurring in Sept. 2006.

...

German utilities E.ON Ag (EON: news, chart, profile) and RWE Ag (DE:703712: news, chart, profile) were early election-play winners, gaining over 2% each on expectations that a Christian Democrat-led government wouldn't subsidize alternative energy to the same degree as a government that included the Green Party.

E.ON and RWE both operate nuclear plants that had been scheduled to be phased out, a law the Christian Democrats had opposed.

Automakers might also get a boost as diesel filters and ecological taxes are less likely to be a priority in a conservative government, Kahler said.

Interesting. I hate those one line paragraphs!

[ozymandius]

32. 2:07 - paint still drying

Dow 10,517.95 +46.04 (+0.44%)
Nasdaq 2,056.76 +10.34 (+0.51%)
S&P 500 1,192.70 +3.42 (+0.29%)
10-Yr Bond 40.65 -0.60 (-1.45%)

NYSE Volume 1,018,992,000
Nasdaq Volume 1,056,484,000

2:00PM: Holding steady at modestly higher levels as buyers remain in control of the action... While many Mondays typically have at least some sort of M&A activity to speak of, today has been rather quiet... However, there has been one announcement that has piqued investors' interest... Western Wireless (WWCA 39.21 -0.19), which agreed to be acquired by Alltel (AT 57.09 -0.29) for approximately $4.0 bln earlier this year (on Monday, Jan. 10), has hired Deutsche Bank to field offers for the possible sale of its portfolio of foreign wireless assets - a deal that could fetch roughly $2.0 bln... NYSE Adv/Dec 1978/1208, Nasdaq Adv/Dec 1574/1348

[ozymandius]

33. Interest Rates Rise at Treasury Auction

WASHINGTON -- Interest rates on short-term Treasury bills rose in Monday's auction with the three-month bill hitting the highest level since September 2001.

The Treasury Department auctioned $17 billion in three-month bills at a discount rate of 2.895 percent, up from 2.800 percent last week. Another $15 billion in six-month bills was auctioned at a discount rate of 3.110 percent, up from 3.070 percent last week.

http://www.heraldsun.com/business/wire/22-610054.html

[ozymandius]

34. 3:10 and up, up, up

Dow 10,556.96 +85.05 (+0.81%)
Nasdaq 2,061.03 +14.61 (+0.71%)
S&P 500 1,196.96 +7.68 (+0.65%)
10-Yr Bond 40.67 -0.58 (-1.41%)
NYSE Volume 1,281,595,000
Nasdaq Volume 1,302,873,00

[Roland99]

35. Hey! We're only about 30 points away from Jan. 2001!!!

What a skyrocketing economy!!!

[RawMaterials]

36. Closing Numbers and Blather

Dow 10523.56 +51.65 (+0.49%)
Nasdaq 2056.65 +10.23 (+0.50%)
S&P 500 1193.86 +4.58 (+0.39%)
10-Yr Bond 4.072% -0.53

NYSE Volume 1,666,433,000
Nasdaq Volume 1,665,133,000


Close: Even in the absence of major market-moving economic and corporate news, falling bond yields ahead of upcoming reports helped extend last week's upside momentum across the board... The possibility that tomorrow's FOMC minutes (2:00 ET) may hint at a slowing in the Fed's "measured" run-up on interest rates, ignited a rally in Treasurys that knocked yields on the benchmark 10-year note (+14/32) down to 4.06% and improved overall sentiment...

Further evidence that the economy is on track to grow at or above long-term trends, as anticipated by an upward revision to Q1 GDP figure - to 3.6% from 3.1% - also prompted broad-based buying efforts that helped eight out of ten economic sectors finish in positive territory... Pacing the way to the upside was Energy (+1.5%), benefiting from a rebound in crude oil prices ($49.16/bbl +$0.51), dollar weakness and upgrades on XOM (+ 1.4%), CVX (+1.6%) and COP (+2.2%) by Sanford Bernstein... After surging to multi-month highs last week and reclaiming most of what was lost in 2004, modest profit-taking weakened the greenback against most major currencies... A weaker dollar also helped ignite widespread buying efforts in the Materials sector (+0.9%)...

Posting more modest gains, but arguably operating as more influential leaders to the upside, were Health Care and Technology... Health Care (+0.4%) posted a modest gain, getting a lift from strength in HMOs and after Raymond James raised its price target on Pfizer (PFE 28.76 +0.18) to $36 (from $32)... Technology (+0.3%) also showed relative strength, as gains in Hardware and Software offset modest pressure in the Semiconductor space...

A 1.4% surge in Hardware, following reports that Apple Computer (AAPL 39.67 +2.12) might consider using Intel's (INTC 26.59 +0.24) microprocessors in its Macintosh computer line, provided most of the momentum... A Goldman Sachs upgrade on the Software group to Attractive from Neutral, citing the emergence of Web services architecture, also lent some support to bellwethers like Microsoft (MSFT 25.85 +0.11) and Oracle (ORCL 12.71 +0.16), but overall software gains were minimized after Legg Mason downgraded BMC Software (BMC 17.45 -0.34) to Sell from Hold amid a muddled fundamental outlook following its disappointing quarter...

Consumer Discretionary (+0.5%) was strong, as Retail (+0.6%) extended last week's 6.6% rally, while the Industrials sector (+0.6%) also closed on an upbeat note... The latter got a lift from United Technologies (UTX 107.38 +2.23), which closed at a new all-time high, a strong performance from 3M Corp. (MMM 78.45 +1.39) and a 2.9% surge in shares of Eaton (ETN 61.10 +1.74), which was upgraded to Neutral from Underweight at JP Morgan... Consumer Staples (+0.1%) also traded higher, getting a boost from Wal-Mart (WMT 47.76 +0.58), which maintained May same store sales growth of 2-4%, and Campbell Soup (CPB 30.75 +0.41), which surged following better than expected Q3 earnings...

Financial, however, was weak after UBS trimmed its earnings targets on American International Group (AIG 53.51 -0.25), Lehman Brothers downgraded Huntington Bancshares (HBAN 23.74 -0.31) and Banc of America downgraded North Fork Banc (NFB 27.61 -0.41)... Utility also traded lower, under pressure after TXU Corp (TXU 78.95 -0.69) agreed to settle an accelerated share buyback by paying Citigroup (C 47.59 -0.21) $523 mln within the next three days... DJTA +0.2, DJUA -0.5, DOT +0.9, Nasdaq 100 +0.5, Russell 2000 +0.6, SOX -0.3, S&P Midcap 400 +0.6, XOI +1.2, NYSE Adv/Dec 2088/1189, Nasdaq Adv/Dec 1673/1391

[loudsue]

37. Thanks, Marketeers! Happy Days Are Here Again!!

:freak: So, how come I can't find a job??? :argh:

:kick:

[AnneD]

38. Loud Sue

you are not alone. I am blessed but I have walked in those shoes:hug: Don't lose hope (easier said than done I know).

[daleo]

39. It finally broke through the 10,500 barrier.

I think that means it will tank tomorrow, although it could be that this seeming mental barrier has been overcome.