STOCK MARKET WATCH, Wednesday 7 April

[ozymandius]

Wednesday April 7, 2004

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 291
DAYS SINCE DEMOCRACY DIED (12/12/00) 3 YEARS, 117 DAYS
WHERE'S OSAMA BIN-LADEN? 2 YEARS, 170 DAYS
WHERE ARE SADDAM'S WMD? - DAY 384
DAYS SINCE ENRON COLLAPSE = 866
Number of Enron Execs in handcuffs = 18
Recent Acquisitions: Skilling
ENRON EXECS CONVICTED = 2
Other Arrests of Execs = 54

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




AT THE CLOSING BELL ON April 6, 2004

Dow... 10,570.81 +12.44 (+0.12%)
Nasdaq... 2,059.90 -19.22 (-0.92%)
S&P 500... 1,148.16 -2.41 (-0.21%)
10-Yr Bond... 4.17% -0.05 (-1.16%)
Gold future... 419.80 +3.50 (+0.84%)

DOW..........................NASDAQ.......................S&P

||


GOLD, EURO, YEN and Dollars


~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
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

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

[ozymandius]

1. WrapUp by Ike Iossif

"The Path of Least Resistance"

For the week ending 3-6-04 I said, "The markets did respond favorably to the positive divergences we mentioned last week with a furious rally. Next week comes the toughest part: continuation and a close above the first upside targets. If we are going to have continuation, the two most likely patterns are illustrated in scenarios one and two. If Thursday's rally was a one day affair, then the two most likely patterns are illustrated in scenarios three and four. All of our indicators are below zero and rising. The "rising" part supports continuation. At the same time, the "below zero" part means that the odds for a rally failure are better than even. If the SP closes above 1115, it will attempt to overcome resistance at 1125. A close above 1125 suggests further continuation. On the other hand, if the SP closes below 1095, it would be a warning flag, suggesting that the rally is being aborted. In either case, I expect above-average volatility and thus the environment will favor option players. A straddle or a collar with striking prices no more than 3% above and below Friday's closing prices ought to be profitable if any of the four scenarios shown below take place."

<cut to charts>

Current Over the last two weeks, we observed two important developments. In the week ending 3-26-04 we witnessed the formation of several steep positive divergences between price and most of our indicators, such as the McClellan Oscillators, the Thrust Oscillators, the Buy/Sell Equilibrium Indexes, the Quantifiers, and the SI25s. Therefore, we pointed out that if the "character" of the market was still bullish, the indices ought to be able to respond positively to these divergences by halting their decline and embarking on a new advance.

Over the past seven trading days the indices have done just that--they rallied with a vengeance! During the course of the rally, the second significant development took place. Most indicators not only turned positive, but more importantly, have exceeded their most recent highs! Such action means one of two things; either the rally is already exhausted and the markets are about to turn down again, or the bull is starting another multi-week rally and the action of the past few days represents the "initiatory thrust."

<cut>
Going into next week, the odds do favor a pullback, given how overbought the markets are. However, strong markets that are for real can get overbought and still continue higher without giving up much ground. Last week we gave you the two most probable price patterns for either a bearish or a bullish environment. It turned out that scenario #1 played out rather accurately. For next week, we have three price patterns that are the most common given the current market structure. Once again, we'll stick with the SP, because its current pattern is more reliable than the one from NASDAQ.

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

[revcarol]

2. So we're overbought, but it's OK.

The market can still go higher. And only the insiders will know when to sell. But BUY, BUY, BUY, all you fools out there.

[ozymandius]

4. Meanwhile, the insiders are selling.

There are plenty of people willing to snap up those shares at the standard market price.

and Good Morning!

[ozymandius]

3. Treasuries Up as Fed Waits for Jobs Data

NEW YORK (Reuters) - U.S Treasury prices rallied on Tuesday, putting a dent in two days of losses after Fed officials said several months of positive jobs data was needed before the central bank could consider raising interest rates.


St. Louis Federal Reserve (news - web sites) President William Poole said it would take "some string of months" of employment numbers before the Federal Reserve can judge if the economic recovery was on a solid path.

The Fed has said it needs evidence of resuscitated employment levels before it can raise official interest rates from four-decade lows.

story

[JNelson6563]

5. Will Iraq disaster play into today?

One can only wonder how events in Iraq will play into the markets. What a nightmare!

Another thing to wonder about, UE#s. I do not believe that 300,000+ number at all and have no faith in what this bunch of thugs tells us.

Julie

[ozymandius]

6. If yesterday was any indication - probably not for awhile.

It seems that the markets move on good news (like Hussein's capture) but never on bad news. It would probably require a tactical failure like Tet for the markets to react. But let me express one caveat: we may be close to arriving at that event.

The markets reacted haltingly to Nokia's profit reports. This also speaks somewhat for software and chip makers, hence the Nasdaq's troubles. Nevermind that average losses of ten soldiers per day have been mounting.

Another caveat: the situation on the ground in Iraq stands a good chance of reverberating through the markets if consumer sentiment sours on the news of staggering military losses. The Marines' losses in Ramadi yesterday from a surprise attack were staggering. People react to that. Remember: these are Marines, not soldiers.

[54anickel]

7. Dollar Watch

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

Last trade 88.59 Change -0.16 (-0.18%)

Settle 88.75 Settle Time 23:35
Open 88.77 Previous Close 88.75
High 89.01 Low 88.46

Dollar down, gold up in Europe

http://www.mlive.com/newsflash/business/index.ssf?/news...

LONDON (AP) -- The U.S. dollar fell Wednesday morning against most other major currencies in European trading. Gold prices rose.

The euro was quoted at $1.2086, up from $1.2065 late Tuesday.

Other dollar rates compared with late rates Tuesday included: 105.81 Japanese yen, down from 106.00; 1.2891 Swiss francs, down from 1.2966, and 1.3122 Canadian dollars, up from 1.3081.

snip>

Gold traded in London at $419.25 bid per troy ounce up from $417.30 late Tuesday. In Zurich the bid was $418.63, up from $417.20.

Gold rose $2.20 in Hong Kong to $418.85.

Silver opened in London at $8.21 bid per troy ounce, up from $8.11.


Japan's Foreign Debt Rating Raised to Aaa by Moody's
http://quote.bloomberg.com/apps/news?pid=10000087&sid=a...

April 7 (Bloomberg) -- Japan's foreign-currency debt rating was raised by Moody's Investors Service to its top ranking after sales of yen boosted the nation's U.S. dollar reserves.

The one-level increase to Aaa from Aa1 affects about $30 billion in corporate or agency debt guaranteed by the government, New York-based Moody's said in a statement. Moody's left Japan's domestic currency rating, which affects 459 trillion yen ($4.34 trillion) of debt, unchanged at A2, its sixth ranking.

Japan probably won't alter its policy of selling yen to protect an export-led recovery, bolstering foreign currency reserves that are already the world's largest, Moody's analyst Thomas Byrne said in an interview. The nation's yen-denominated public debt, which is approaching 144 percent of gross domestic product, may not be reduced by the economic recovery, he said.

``For those who believe in Japan's revival story it's a great support,'' said Hideaki Kurimoto, who helps manage the equivalent of $2.9 billion at Meiji Dresdner Asset Management Co. in Tokyo. Still, he said, ``the Moody's upgrade in reality may have limited impact since it's only for foreign debt.''

Prime Minister Junichiro Koizumi's government plans to sell a record 36.6 trillion yen of new yen-denominated bonds this fiscal year starting April 1 even is it projects economic growth of 1.8 percent, the third year of expansion.

snip>

Bad Loans

Koizumi, who marks his third anniversary in office on April 26, has sought to cut spending on public works and reduce the bad loans that have choked the banking system.

Japan's economy grew at a 6.4 percent annual pace in the three months to Dec. 31, the fastest since the nation's asset- price bubble burst in 1991. Exports and consumer spending each accounted for about a quarter of the growth.

Executives at Japanese service companies were optimistic for the first time in seven years in March as an export-led recovery sparked consumer spending, the Bank of Japan's Tankan survey showed last week. Confidence among leaders at large manufacturers was the highest since 1997.

The upgrade of Japan's foreign currency government bond rating reflects Japan's efforts to overhaul its economy, Finance Minister Tanigaki told reporters today.

``Japan's various efforts at reforming the economy are being reflected little by little in economic indicators,'' he said.

more...

http://www.fxstreet.com/nou/content/102055/content.asp?...

Key factors today:

Liquidity will be relatively low over the next 48 hours, increasing the risk of sharp intra-day volatility, especially with a lack of major data.

Euro/dollar:

The dollar should remain firm in the short term due to optimism over the US economy and speculation over an ECB rate cut. The US currency is still vulnerable to a further period of consolidation and correction, especially with liquidity dipping and concerns over the Iraq situation. There is still the potential for a dollar move to 1.1850 in the medium-term target, but the dollar will find it more difficult to strengthen through 1.20 in the very short term.

snip>

The latest US layoff figures reported a decline to a 9-month low and the optimism over the US economy should persist. The comments from Fed officials will be an increasingly important short-term influence. Last night, Fed official Poole stated that the Fed must act aggressively on inflation if needed, but there were no indications that he was advocating an immediate increase in rates. There will still be expectations that a Fed tightening will be brought forward and the May Fed meeting will be very important.

The dollar will be vulnerable to profit taking after the gains since last Friday. There will also be some unease over the situation in Iraq which could dampen confidence in the US currency. The underlying dollar tone should, however, remain firm in the short term, especially with a lack of confidence in the Euro-zone developments. Speculation over an ECB rate cut and divisions within the bank will continue to unsettle the Euro.

[54anickel]

8. Gasoline, politics, and the dollar

http://www.ameinfo.com/news/Detailed/37462.html

We have long argued that the Bush administration has been happy with a lower dollar as a weaker dollar should be seen as a means to an end and that end is greater employment growth.

It all seems so one way – the lower dollar together with fiscal and interest rate policy would all combine to stimulate the economy in this election year 2004. In the 'politicisation of the dollar' we argued that the administration would be happy with a lower dollar as long as it served their interests.

We went on to argue that by July all the easing should be in place and in the system and a period of stability in the dollar over the election period would be in their best interests.

Here we demonstrate how the lower dollar may be starting to become an election issue much sooner than we first thought. Recently there has been a big political brouhaha regarding gasoline prices. In level terms gasoline prices are at a record high, and it has been recently reported that they have reached a national average of $1.80 a gallon.

more...

[54anickel]

9. Defensives bolster European stocks, Daimler drags

I remember one of our wrap-ups discussing the move to "defensives" during market uncertainty. If I remember correctly it was lipstick and cosmetics they used in that article as examples for the US.

http://www.forbes.com/markets/newswire/2004/04/07/rtr13...

LONDON, April 7 (Reuters) - European shares climbed on Wednesday as investors put money into recent under-performers such as drink and drugs firms but automaker DaimlerChrysler <DCXGn.DE> weighed despite assurances on its outlook.

Mobile phone giant Nokia <NOK1V.HE> remained under pressure, falling for a second day after telling investors that sales dipped in the first three months of the year and its earnings would be below market expectations.

Defensive sectors such as healthcare <.SXDP> and food and beverages <.SX3P> found favour after underperforming the rebound in stocks over the past two weeks. Spirits heavyweight Diageo <DGE.L> led the gains, rising 2.6 percent after dealers said joint house broker Cazenove upped its rating on the stock to "buy".

"For the last 12 months, the name of the game was to have stocks sensitive to the economic recovery," said Juergen Lukasser, a global fund manger for Constantia Privatbank in Vienna which has about five billion euros under management.

"Although there have been some positive developments, people are getting a little bit more concerned about how the economic recovery will progress and are looking to reduce exposure to beta," he said, referring to riskier high-beta stocks which tend to exaggerate market moves.

more...

[54anickel]

10. Before the Bell-Alcoa falls, Sirius Satellite, MGM rise

Looks like the market is not going to be easily pleased in this round of earnings reports. Must have their expectations already priced in again.

http://www.reuters.com/financeNewsArticle.jhtml?type=ma...

CHICAGO, April 7 (Reuters) - Shares of Alcoa Inc. fell in trading before Wednesday's opening bell, one day after the world's biggest aluminum producer said earnings for the quarter more than doubled on higher aluminum prices and strong sales to car and plane makers. But the results disappointed some investors as the earnings fell short of Wall Street's target.

Alcoa shares dipped to $35.25 on the INET electronic brokerage system after Tuesday's close of $36.50 on the New York Stock Exchange.

[54anickel]

11. Politics, Jobs, Trade War

http://205.232.90.194/editorials/willie/willie040604.ht...

big snip>

Look for misguided trade protection coming this autumn. Economic good sense is hardly the likely outcome. Historical accounts from decades past will continue to bend to political opportunism. The obstruction of Chinese imports will lead to importation of similar products from other low-cost Asian sources. After two to three years of severe cost competition, much US mfg has been gutted, with thousands of plants shut down. Advisors cling naively to the notion that jobs can be restored by either currency shifts or trade protection. They will not.

Jobs will not so easily return to our economy if we thwart the Asian flow of finished goods. Instead, we risk very serious retaliation by our Chinese credit masters. A politician who urges blockage of Chinese goods overlooks the consequent reaction by distant leaders in Beijing. The People's Bank of China owns $400 billion in foreign reserves, almost $150 billion of which rests in the form of US Treasury Bonds. The Bank of Japan possesses nearly $700 billion in USTBonds. China is a major ongoing purchaser of US Treasurys. If Chinese leaders are angered by near-sighted and angry trade sanctions, we will feel the impact of either reduced govt & agency bond purchases, or outright selling. Their foreign reserves are at risk due to currency exchange. Diversification away from US$-denominated securities might broaden. The result would be higher interest rates during a fragile and lopsided economic recovery. Our dependence on low interest rates is grim.

The leaders of the United States had better be careful. Frustration over job losses is building to a fever pitch. Voters will continue their appeal to political leaders for action. Their responses are not likely to be successful, because a real solution involves a lengthy recession and cleansing of massive debts. Our entire cost structure must be reduced, which requires a sizeable USDollar devaluation and a closure of the wage gap between the US and Asia. The solution will be painful. Trade protection and its many sanctions are certain to occur. Higher prices are the inevitable result. If Americans are forced to purchase domestic goods, then our rising material costs, higher labor costs, and higher overhead costs can result only in end products at an elevated price. Asian retaliation will come in two ways. They will be less willing to support our credit markets, now the object of truly monstrous subsidies. Thus we face higher interest rates within our entire economy. FOREX markets will join the Asians in USDollar selling, if not gradual abandonment. Thus higher import costs inside American shores. Tariffs will also raise prices for imported goods in direct fashion, but in select product groups.

Curtailment of free trade carries with it horrible geopolitical risks. Higher price levels are but one consequence. Early in the 1930 decade, retaliation raged among nations in trade protection intended to save domestic jobs. They failed, as unemployment rose to 25%. Politics and ignorance drove the process. In just four years, from 1929 to 1932, world trade went into a tailspin by fully two thirds. History teaches us that armed conflict (i.e. military war) often follows in the wake of trade war gone amok. When nations do not obtain what they need through peaceful negotiation, they tend to seize by force. Amidst the chaos, old scores are settled. The most famous quote to this effect is from Frederic Bastiat, who posed "When goods are not allowed to cross borders, armies will."

Much hubbub has been made of "comparative advantage" and how the United States benefits in evolutionary leapfrog fashion from round after round of creative destruction. The message rings hollow that in free global trade, both sides win. As the work of John Maynard Keynes has been misapplied (ignoring debt), so now the work of David Ricardo is being misinterpreted. Expect the entire topic of job export and its misconstrued benefits to become a raging explosive issue. Our national leaders are flying blind. The crew of US economic experts in our nation is the most inept in the entire world. They extend micro-economics to a national level, and deem it valid macro-economic analysis. Macro-economics is our enormous defect among the brain trust. A clear view is missing of the minefield ahead, as insufficient income will be available to service rapidly growing debt. See a Richard Benson article, wherein he justifies how we have passed the point of no return. Discussion of these important topics will be continued in next newsletter issues.

more...

[Maeve]

12. And the Casino opens in the red

Dow 10,526.37 -44.44 (-0.42%)
Nasdaq 2,052.43 -7.47 (-0.36%)
S&P 500 1,144.63 -3.53 (-0.31%)
10-Yr Bond 4.163% -0.008


Hello, I must be going....following the Iraq mess this morning (and DU is one of the better places to do that!) and off to a meeting later, but thought I'd stop by and get a quick post in.

y'all!

[54anickel]

14. Mornin Maeve! I think all eyes will be on Iraq today. Very sad mess

over there.

[54anickel]

13. 9:41 and we're off to the races

edit for html and blather

Dow 10,521.55 -49.26 (-0.47%)
Nasdaq 2,050.66 -9.24 (-0.45%)
S&P 500 1,144.06 -4.10 (-0.36%)
30-yr Bond 5.004% -0.012

NYSE Volume 60,645,000
Nasdaq Volume 135,104,000

9:40AM: In tune with futures indications, the cash market is off to a lower open... The apprehensive stance is rooted in disappointing corporate developments, including Alcoa's (AA 35.70 -0.80) worse than expected earnings report (see Earnings Briefing for more details) and downward guidance by Seagate (STX 13.10 -2.49) - see Story Stocks for more perspective... Despite the lackluster start to the Q1 earnings season, expectations remain for growth of 17% in the S&P 500 versus last year...
This morning's economic reports included the Export Prices report ex-agriculture and Import Prices report ex-oil, which checked in at 0.6% and 0.2%, respectively, but did not make much of a splash on trading action...

[Maeve]

16. 10:30 and not getting better

Dow 10,517.03 -53.78 (-0.51%)
Nasdaq 2,047.77 -12.13 (-0.59%)
S&P 500 1,142.55 -5.61 (-0.49%)
10-Yr Bond 4.148% -0.023
NYSE Volume 263,851,000
Nasdaq Volume 400,700,000

[54anickel]

17. Still nothing on Iraq in the blather, I'm guessing maybe the 11:00 update

may make mention. Just look at gold! And the last blather did state gold was doing well....

10:00AM: The market maintains its stance in negative territory, with the Dow underperforming the S&P 500 and the Nasdaq on a relative basis... The bulk of the sectors are trading in the red, but strong sector leadership in one direction or the other is limited... Laggards of note include the hardware, computer storage, computer peripherals, casino & gaming, homebuilding, and real estate operations groups... There are no influential leaders to the upside, but the gold, drug, and internet groups are among the sectors in the green...NYSE Adv/Dec 976/1545, Nasdaq Adv/Dec 948/1473

[54anickel]

15. Central Pranking

http://205.232.90.194/editorials/mackenzie/mackenzie040...

John Mackenzie
April 7, 2004

"Like gold, U.S. dollars have value only to the extent that they are strictly limited in supply.

But the U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost. By increasing the number of U.S. dollars in circulation, or even by credibly threatening to do so, the U.S. government can also reduce the value of a dollar in terms of goods and services, which is equivalent to raising the prices in dollars of those goods and services. We conclude that, under a paper-money system, a determined government can always generate higher spending and hence positive inflation. Of course, the U.S. government is not going to print money and distribute it willy-nilly... if we do fall into deflation, we can take comfort that the logic of the printing press example must assert itself, and sufficient injections of money will ultimately always reverse a deflation." -Ben Bernanke

The same, tired supply side only rational, no mention of actual demand for dollars. Artificial demand, certainly, but why?

That's far more straightforward.

Mr. Bernanke furthers his plight:

"We can take comfort that the logic of the printing press example must assert itself, and sufficient injections of money will ultimately always reverse a deflation."

Please cite once, throughout history, this has succeeded, just once.

Inevitable debt deflation is lay directly before us, it cannot be serviced, but our "Central Pranksters" will attempt every viable form of monetary malfeasance to assure us all they've tried.

The Fed's power to prolong the hyperinflation scenario is not without substance.

We will soon see if the rest of those at the table cave in and join the secular end game. To date, they've resisted far more than I had suspected they would.

much more...

[54anickel]

18. 11:24 still nothing on the news. Funny how they used to use bad news

as an excuse for down days. Of course that was when the markets were breaking some important technicals.
Maybe they've been reading DU.

Dow 10,481.33 -89.48 (-0.85%)
Nasdaq 2,041.93 -17.97 (-0.87%)
S&P 500 1,140.45 -7.71 (-0.67%)
30-yr Bond 4.985% -0.031

NYSE Volume 476,959,000
Nasdaq Volume 646,428,000

11:00AM: New session lows, with the major averages failing miserably at any rebound attempts... The Nasdaq continues to spearhead the decline and underperform its blue-chip counterparts on a relative basis... Breadth figures are unfavorable, with decliners outpacing advancers by a 2-to-1 margin on the NYSE and the Nasdaq... Down volume is leading up volume by a 3-to-1 margin on the NYSE and slightly on the Nasdaq... Volume is running in-line with the levels seen earlier this week, which is to say moderate...
The ratio of new 52-week highs versus new lows is uninspiring, with 48 and 69 new highs juxtaposed with 7 and 6 new lows....NYSE Adv/Dec 1071/1907, Nasdaq Adv/Dec 909/1877

[54anickel]

19. U.S. stocks down on earnings misses, Iraq tensions

http://www.forbes.com/markets/newswire/2004/04/07/rtr13...

snip>

"Indexes are lower due to negative news from Seagate Technology, which is hurting the technology area," said Tom Schrader, managing director of U.S. equity trading at Legg Mason Wood Walker. "Alcoa is a big bellwether stock, and since its down 2 percent, it's dragging down the industrials."

"Outside of that, the markets kind of meandering. It's kind of directionless," Schrader added.

Stock investors are anxiously waiting to see if first-quarter earnings can measure up to the lofty expectations built up in recent weeks -- expectations that have helped put the three major market gauges back within striking distance of their 2004 highs.

snip>

Geopolitical issues, which had faded into the background for Wall Street in recent weeks as investors focused on the outlook for the economy and corporate earnings, have begun to re-emerge amid a rising wave of violence in Iraq.

U.S.-led forces battled Sunni guerrillas in two cities on Wednesday and grappled with a radical Shiite uprising in a two-front war that has killed more than 30 soldiers and 160 Iraqis in three days.

"The market appears to be at a tipping point related to the tensions building in Iraq," said Keith Keenan, vice president of institutional trading at brokerage Wall Street Access. "Any further headlines, which are likely to be, unfortunately, negative, could weigh on the market."

A report on import and export prices, data that Wall Street usually gives little more than a cursory glance, caught the attention of some investors after the March figures soared well above expectations.

Import prices rose 0.9 percent, above the 0.5 percent gain economists had expected, heightening fears inflation may be working its way through the system and could force the Federal Reserve to hike interest rates soon.

[54anickel]

20. 12:26 update

Dow 10,487.41 -83.40 (-0.79%)
Nasdaq 2,042.59 -17.31 (-0.84%)
S&P 500 1,140.36 -7.80 (-0.68%)
30-yr Bond 4.981% -0.035

NYSE Volume 648,359,000
Nasdaq Volume 836,377,000

12:00PM: In an extension of yesterday's losses, the market is retreating again in today's session, with the major averages having spent the entirety of the session on the defensive... The negative sentiment is rooted in disappointment over a rather uninspiring start for the Q1 earnings season, which included worse than expected earnings from Alcoa (AA 35.50 -1.00) and downward guidance from Seagate Technology (STX 14.15 -1.44)...
While today's headlines are uninspiring, keep in mind that the Q1 earnings season just began and expectations remain set for year/year earnings growth of 17% for the S&P 500, while Briefing.com looks for growth of at least 20%... The bulk of the sectors in today's session are in the red, with laggards of note including the hardware, networking, semiconductor, software, transportation, casino & gaming, and aluminum groups... Leaders to the upside are harder to come by, but include the gold, oil & gas services, and real estate operators sectors... The latter is rebounding on the heels of 3 losing sessions, which were triggered by an uptick in interest rates on the heels of Friday's strong Employment report...

The bond market is little changed, with the 10-year note up 4/32, bringing its yield down to 4.13%...

[JNelson6563]

21. Looks grim

12:43 and it looks like even the greed-driven lemmings are a bit wary.


Dow 10,483.55 -87.26 (-0.83%)
Nasdaq 2,042.66 -17.24 (-0.84%)
S&P 500 1,139.99 -8.17 (-0.71%)
10-Yr Bond 4.137% -0.034


Oh wait, no it's jsut becasue Alcoa didn't meet expectations. The fact that things are going horribly awry in Iraq have nothing to do with it. Mmm hmm.

Julie

[teryang]

22. Events in Iraq will effect market

If American casualties are high or if we get a POW situation this market can drop like a rock.

Eventually this war will take its toll on the market, because it is open ended.

[54anickel]

23. 1:48 update not a peep about Iraq

Dow 10,479.33 -91.48 (-0.87%)
Nasdaq 2,043.72 -16.18 (-0.79%)
S&P 500 1,139.94 -8.22 (-0.72%)
30-yr Bond 4.997% -0.019

NYSE Volume 837,208,000
Nasdaq Volume 1,055,377,000

1:30PM: The major averages are vacillating near their respective session lows... While the selling pressure experienced earlier in the session has subsided, buyers are not rushing to use the dip as a buying opportunity... Accordingly, leadership to the upside remains limited to the real estate operations, oil & gas services, and gold sectors... The biotech sector is among today's laggards of note, with Biosite (BSTE 36.65 -0.97), Chiron (CHIR 45.80 -0.16), and Genentech (DNA 109.11 -1.04) among the biggest losers...
CHIR is lower after a federal appeals court upheld a lower court's ruling that the company had made an invalid patent-infringement claim over DNA's drug, Herceptin... Bank of America also mentioned this morning that CHIR may miss earnings in its upcoming report... Separately, DNA is scheduled to report earnings after the market closes... The consensus estimate is for EPS of $0.31...NYSE Adv/Dec 1336/1882, Nasdaq Adv/Dec 1123/1907

1:00PM: More of the same, with the major averages trending sideways along their respective session lows... Although the Nasdaq is performing roughly in-line relative to the Dow now, the tech composite spearheaded the market's earlier decline... The Nasdaq's pullback, in turn, was incited by selling interest in the semiconductor sector, which is down 1.2%, as indicated by the SOX index... Remember that the semiconductor sector has led the Nasdaq in its decline through the beginning of the year and in the tech composite's rebound over the past two weeks...

[cosmicdot]

36. Genentech Profits Surge on Brisk Sales

FWIW

Genentech is a company which owns 8.4% of VaxGen, one of 2 companies awarded a contract for anthrax vaccines (the other was a British firm) ... through Beneficial Ownerships, etc., Genentech links to Societe Generale which links to ENTRUST which links to Nortel and Franklin Resources (Tom Kean sits on Franklin's Board)

http://news.scotsman.com/latest.cfm?id=2641903


Beneficial Ownership of VaxGen - 5% or more of stock

Genentech, Inc. ............................... 1,522,354
8.4%
1 DNA Way
South San Francisco, CA 94080

http://makeashorterlink.com/?L167421C7

In June 1999, the Company redeemed all of our callable putable common
stock, par value $.02 per share (or "special common stock") held by
stockholders other than Roche Holdings, Inc. (or "Roche") in cash and
retired all of the shares of special common stock including those
held by Roche. As a result, Roche's percentage ownership of our
outstanding equity increased from approximately 65% to 100%.

Societe Generale .......................... 950,570 5.1% 1,635
58.7%
1221 Avenue of the Americas
New York, NY 10020


Societe Generale's COMPANY CONFORMED NAME:
ENTRUST TECHNOLOGIES INC
2323 NORTH CENTRAL EXPRESSWAY
RICHARDSON
TX 75080

http://makeashorterlink.com/?T257121C7

Entrust Beneficial Ownership

Nortel Networks Limited
8200 Dixie Road, Suite 100
Brampton, Ontario L6T 5P6
Canada
9,629,159
14.9 %

Franklin Resources, Inc.
One Franklin Parkway
San Mateo, CA 94403
5,662,875
8.8 %

Entrust Board of Director info at this link:
http://makeashorterlink.com/?U637121C7


http://groups.yahoo.com/group/corporatesleuth/message/3...



Genentech Profits Surge on Brisk Sales

April 7, 2004 03:38 PM EDT


SAN FRANCISCO - Biotechnology company Genentech Inc.'s yearlong hot
streak continued Wednesday when it reported robust profits for the
first quarter while its newest cancer drug Avastin rang up better-
than-expected sales since its launch earlier this year.

The results, released after the stock market closed Wednesday, beat
analysts' expectations.

For the quarter ended March 31, the South San Francisco, Calif.-based
company earned $176.6 million, or 33 cents a share, a 17 percent
increase over the previous year's first-quarter earnings of $151.5
million, or 24 cents a share.

Excluding special expenses, Genentech said it would have posted a
profit of $207.6 million, or 38 cents a share. On that basis, the
results exceeded the per-share estimate among Wall Street analysts by
7 cents, according to research firm Thomson First Call.

Revenue was $975.1 million in the quarter, an increase of 30 percent
from a year earlier.

The company's stock has tripled in value in the last year, boosted by
surprisingly strong data released in May that showed Avastin helped
the sickest colon cancer patients.

http://start.earthlink.net/newsarticle?cat=1&aid=D81Q83...

On the Net:

Genentech: http://www.gene.com

[54anickel]

37. Ewwww! Thanks much for posting this. n/t

[54anickel]

24. U.S. stocks troubled by slow start to earnings season

http://biz.yahoo.com/cbsm-top/040407/484a53d1f0edb3ac5a...

NEW YORK (CBS.MW) - Weakness in U.S. stocks deepened in afternoon action Wednesday with the blue chips roiled by Alcoa's earnings miss, and the techs getting hit following a warning from disk drive maker Seagate.

The Dow Jones Industrial Average (^DJI - News) fell about 96 points, or 0.9 percent, to 10,475, while the Nasdaq Composite sank roughly 19 points, or 0.9 percent, to 2,041.

Since threatening to dip below 10,000 on March 24, the Dow has gained ground in seven of the past nine sessions, running within a range of 10,007 and 10,570 on an intraday basis. Over the same period, the Nasdaq has bounced from a low of 1,897 to a high of 2,079 on April 5 before pulling back of late.

snip>

Economic data was fairly minor as far as stocks were concerned with prices for imported goods rising for the sixth straight month, and mortgage re-financing in decline last week.

Breadth in the Dow was overwhelmingly negative with 28 of the index's 30 components in decline. The lone gainers were Johnson & Johnson and United Technologies.

Midday volume was 711 million on the New York Stock Exchange, and 941 million on the Nasdaq. Breadth in the broad market continued Tuesday's strong negative trend with losers outpacing winners on both exchanges, 19 to 13 on the Big Board, and 19 to 13 on Nasdaq.

Paul Mendelsohn, chief investment strategist with Windham Financial Services, said the deterioration of advance-decline activity on the New York Stock Exchange is a sign that markets may be "consolidating off of their near-term oversold conditions" but he still see some barriers to further upside at current levels.

"Events in Iraq are likely holding the markets back, as they present a potential re-election problem for President Bush and conditions in that country continue to destabilize," he said in note to clients. "We are going to need some positive earnings surprises within the next few days in order to drive this market higher."

[54anickel]

25. Stocks Lower at Late Morning on Iraq, Earnings Concerns

The Wall Street Journal Online
Stocks retreated Wednesday as weaker-than-expected earnings from aluminum maker Alcoa and news of heavy fighting in Iraq weighed on investors.

snip>

Inflation fears also may have played a part in trading after the Labor Department said overall import prices rose 0.9% in March, following a 0.4% increase in February. Wall Street had expected a gain of only 0.4% to 0.7%. The acceleration reflected resurgent petroleum prices, which climbed 6.1%. Prices of nonpetroleum imports rose just 0.2%, half the rate in February.

snip>

News from the Middle East also weighed on the market as U.S.-led forces battled Sunni guerrillas and tried to manage a radical Shiite uprising Wednesday in Iraq. Fighting in the past three days has led to the deaths of more than 30 Americans and 150 Iraqis in Fallujah and Ramadi.

Market watchers said the disappointing Alcoa news, combined with headlines from abroad, may have finally burst investors' bubble.

"We're so close to earnings season, and the expectations are so high...that that's kept investors in the market," said Jeff Kleintop, chief investment strategist at PNC Financial Services Group. "Now that we get...a number of disappointments, that pulls some of the optimism that was helping support stock prices in the face of these geopolitical headlines."

snip>

In other economic news, the Federal Reserve reports on consumer credit for February at 3 p.m. Eastern time. Economists expect an increase of $7.8 billion, compared with a rise of $14.3 billion in January.

[54anickel]

26. Why oil prices will stay high (Go Shrub!)

http://www.atimes.com/atimes/Global_Economy/FD08Dj02.ht...

The recent decision by the Organization of Petroleum Exporting Countries (OPEC) to reduce oil production has crystallized the growing influence of geopolitics on crude-oil supplies.

Despite strong pressure from the administration of US President George W Bush on OPEC to delay its planned production cut, the position of Saudi Arabia - to reduce supplies - prevailed. More important than the immediate impact on oil prices, OPEC's action signals the depth to which US foreign relations with Persian Gulf countries have plunged in the year since the US invasion of Iraq. US foreign relations with other key oil-producing countries, including Russia and Venezuela, have also weakened considerably over the past year. Increasing antagonism between the world's largest oil producers and the Bush administration will keep world oil supply lean through at least the end of 2004. With supply diminished, oil demand, particularly in Asia, will remain strong, pushing international oil prices above US$40 per barrel.

Saudi Arabia holds the world's largest petroleum reserves and accounts for more than one-third and one-half of total OPEC oil production and spare production capacity, respectively. Its dominant position in OPEC and importance to world oil supply has made strong relations with Saudi Arabia a priority for the US government over many administrations. In the past, strong relations with Saudi Arabia gave the United States considerable influence over OPEC, helping to ensure that international oil prices remained at levels acceptable to consuming countries. But over the past three years, relations between the Bush administration and Saudi Arabia have deteriorated substantially. The role of Saudi nationals in the terrorist attacks against the US in September 2001 instigated this deterioration. The deterioration in relations advanced with the US invasion of Iraq, which Saudi Arabia, along with many other Gulf countries, opposed. These countries opposed the war in Iraq specifically because they feared it would strongly destabilize the entire region - a fear that has been realized.

In addition to the chaotic conditions accompanying the US occupation of Iraq and growing instability there, terrorist attacks have occurred in Saudi Arabia, Morocco and Turkey. The conflict in the Palestinian Territories has escalated to heights unimaginable two years ago and the Bush administration continues to threaten Syria and Iran. Washington has succeeded in alienating almost every country in the Middle East. Against this background, it's no great leap to infer that many of the region's governments would be happy to see Bush defeated in this year's presidential elections, potentially heralding a change in US foreign policy and the return of stability in the Middle East. While the Gulf countries have no influence over US foreign policy, they do have modest leverage over the US economy via their ability to control oil supply and therefore international oil prices. High oil prices will undermine the US economy, threatening Bush's re-election.

more...

[54anickel]

27. 3:14 udpate and we have bargain hunters again

Dow 10,522.81 -48.00 (-0.45%)
Nasdaq 2,059.25 -0.65 (-0.03%)
S&P 500 1,145.23 -2.93 (-0.26%)
30-yr Bond 5.010% -0.006

NYSE Volume 1,131,175,000
Nasdaq Volume 1,435,096,000

3:00PM: Buyers stepped out of the woodwork in the last half an hour, driving the Nasdaq higher... The notable improvement in the tech composite has also incited buying interest in the broader market, with the blue-chip averages having lifted out of their earlier trading ranges... The improvement in the indices came despite a Fox report that a suspicious package had been found in the Atlanta airport...
The internet, networking, and semiconductor sectors, which had been among the laggards earlier in the session have caught a bid, lifting near their best levels of the session and sponsoring the Nasdaq's rebound...NYSE Adv/Dec 1424/1839, Nasdaq Adv/Dec 1339/1755

[54anickel]

28. U.S. consumer credit grew by $4.1 bln in February

http://www.forbes.com/markets/newswire/2004/04/07/rtr13...

snip>
The Fed said outstanding consumer credit, which excludes mortgage debt, rose by $4.1 billion to a seasonally adjusted $2.019 trillion in February.

January credit growth was revised up to an $15.8 billion gain from the initially reported $14.3 billion surge.

[Frodo]

29. Maybe that's what's having an effect on the markets?

The upward revision is bad, but wasn't 4B close to half what was anticipated?

[54anickel]

30. Market expected 7.7B (Briefing forecast 2.0B - ha) n/t

[54anickel]

31. An about face at 3:33 ( heading back down)

Dow 10,497.63 -73.18 (-0.69%)
Nasdaq 2,055.02 -4.88 (-0.24%)
S&P 500 1,143.20 -4.96 (-0.43%)
30-yr Bond 5.011% -0.005

NYSE Volume 1,210,268,000
Nasdaq Volume 1,531,805,000

3:30PM: With half an hour of trading remaining, the Nasdaq has lifted to fresh session highs, while the Dow and the S&P 500 have also improved their standing toward their best levels of the morning...

The uptick is being attributed to short-covering and the fact that the Atlanta airport scare turned out to be a non-event for the market... Given today's modest volume levels, the exhibited volatility is not surprising and is indicative of the kind of action the market is likely to see in tomorrow's pre-holiday session...
After the market closes, look for earnings reports from Genentech (DNA 108.70 -1.45), Research In Motion (RIMM108.32 -1.46), and Yahoo (YHOO 48.88 +0.11)...NYSE Adv/Dec 1738/1550, Nasdaq Adv/Dec 1680/1428

[54anickel]

32. Closing numbers and yada - got around to Iraq

Dow 10,480.15 -90.66 (-0.86%)
Nasdaq 2,050.24 -9.66 (-0.47%)
S&P 500 1,140.53 -7.63 (-0.66%)
30-yr Bond 5.011% -0.005

NYSE Volume 1,461,781,000
Nasdaq Volume 1,779,098,000

Close: The market spent the entirety of the session in negative territory in a reversal of last week's sweeping gains and undermined by a variety of concerns ranging from geopolitical, to corporate, to inflationary... More specifically, Iraq came back into focus due to the conflict's escalation over the last couple of days... Separately, Q1 earnings season got off to a rather uninspiring start with an earnings miss from Alcoa (AA 34.75 -1.75) and a downward estimates revision from Seagate Technology (STX 14.96 -0.63)...
Finally, the price of crude oil rallied (up $1.18 at $36.15/bbl) after the U.S. Department of Energy report indicated that supplies declined 2.1 mln barrels in the week of April 2... Accordingly, the major averages slipped at the onset of the session and spent the bulk of the afternoon drifting sideways with moderate losses... Given the modest volume totals, thought, the last hour of trade proved to be volatile as short-covering and geopolitical rumors lifted the major averages to their session highs, but only to be crushed again as Secretary of Defense Donald Rumsfeld held a press conference concentrated on the escalation of violence in Iraq...

Leadership to the upside was limited through most of the session, including the oil & gas services, and real estate operations groups... Laggards of note were easier to come by and included the retail, chemical, aluminum, casino & gaming, and computer storage sectors... Elsewhere, the bond market was little changed, with the 10-year note down 2/32, bringing its yield up to 4.16%...

[54anickel]

33. Why Housing Could Spring a Leak

http://biz.yahoo.com/bizwk/040407/nf20040474797_db035_1...

It sure looked like good news: On Apr. 2, the government announced that a stunning 308,000 new jobs were created in March (economists were expecting only about 130,000). For the housing market, however, these tidings hit like a ton of bricks. Almost immediately, interest rates started rising, and housing stocks started falling.

KB Homes (NYSE:KBH - News) fell from $80.20 to $76.60 that day and to $75.27 the next (see BW Online, 4/5/04, "KB Home: Cyclical No Longer?"). D.H Horton (NYSE:DHI - News), Lennar (NYSE:LEN - News), and Centex (NYSE:CTX - News) all slumped an average of about 7% those two days before rebounding a bit on Apr. 6.

Are these stocks signaling potential weakness ahead for real estate? You bet they are. While housing experts point to myriad reasons why the real estate market will likely stay robust through 2004, the risk of a serious downturn in the next few years is clearly increasing -- particularly in areas of the country where home prices have risen the most.

"AN ATTRACTIVE ZONE." So far, the interest rate jumps have been moderate. Mortgage rates, both traditional 30-year and adjustable, remain way below their historical average of around 8%. But on Apr. 6, Bankrate.com's overnight survey of lenders showed the average rate on a 30-year-fixed mortgage spiked to 5.48%, up from 5.2% a week earlier.

"It's hard to be too concerned about such a relatively small backup," notes Mike Sklarz, chief valuation officer for real estate services company Fidelity National Financial in Jacksonville, Fla. "We're still in such an attractive zone of interest rates." He believes rates would have to rise to 6.5% or 7% to hurt the market.

That kind of a rise doesn't seem likely this year. Indeed, rates briefly climbed above 6% last August, only to retreat quickly when the economy slowed in the fourth quarter. But through it all, sales volume and home-price appreciation nationally have never slumped. And if the economy continues to grow and inflation perks up, a housing market bubble is certainly a plausible scenario a year or two from now.

THE AFFORDABILITY QUESTION. Any downturn in the market could have major economic ramifications. With home ownership now up to almost 70% of households, Americans are pouring more and more of their savings -- as well as their hopes and dreams -- into their homes. "You can't ignore the fact that low interest rates haves aided affordability and to some extent deserve credit for continued rapid price appreciation in real estate prices over the year," says Greg McBride, financial analyst at Bankrate.com.

much more...on the increase in ARMs

[JNelson6563]

34. This is going to be tricky

I do not believe the housing boom is even remotely sustainable. That is a train wreck waiting to happen. What worries me is will real estate values hold? They almost always do but we've had a lot of unprecedented stuff the last few years so it seems conventional wisdom is out the window these days.

Julie

[54anickel]

35. That's the big question -

As net wages continue to be driven down, who will be able to afford to buy them? "Unprecedented stuff" is putting it mildly. The values in my area have gone up, but not as drastically has what I've been reading about in areas such as most of CA, Denver, New York, etc.

I plan on staying out until I die or end up in an old-folks home, so I'd welcome some devaluing if it will lower my property taxes (fat chance). But I'm sure people like me are the "odd-man out".

I feel for some of the younger purchasers, especially those with interest only mortgage deals and low to no down. They've built no equity and if the value drops rather than increases - well you know the rest.