Market News

[weatherweenie]

8:30am ET
[BRIEFING.COM] S&P futures vs fair value: -7.0. Nasdaq futures vs fair value: -12.0. Still shaping up to be another dismal start for stocks as investors lack any overwhelming evidence to get buying efforts back on track. Among a handful of positive developments, Warren Buffett's Berkshire Hathaway has bought another 10.1 mln shares of Burlington Northern Santa Fe (BNI) and MedcoHealth Solutions (MHS) has agreed to buy PolyMedica (PLMD) for $1.5 bln.
However, today's only notable M&A deal is hardly of the blockbuster variety and Buffett's interests in railroads has been public knowledge for several months, leaving the door open for investors to put renewed subprime concerns front and center as a reason to keep questioning valuations following last week's sizable market gains.

 

[James48843]

Housing values continue to sink too. In my area (Detroit metro region) home prices are down 11%. And we weren't even on the bubble the last few years- we were depressed to begin with.

Yahoo news says:

AP



Home Prices: Steepest Drop in 20 Years
Tuesday August 28, 9:58 am ET
By Vinnee Tong, AP Business Writer

S&P Says Housing Prices Fell in 2Q by Steepest Rate Since Its Index Was Started in 1987

NEW YORK (AP) -- U.S. home prices fell 3.2 percent in the second quarter, the steepest rate of decline since Standard & Poor's began its nationwide housing index in 1987, the research group said Tuesday.

The decline in home prices around the nation shows no evidence of a market recovery anytime soon, one of the architects of the index said.

MacroMarkets LLC Chief Economist Robert Shiller said the declining residential real estate market "shows no signs of slowing down."

The report came a day after the National Association of Realtors said sales of existing homes dropped for a fifth straight month in July while the number of unsold homes shot up to a record level.

The S&P/Case-Schiller quarterly index tracks price trends among existing single-family homes across the nation compared with a year earlier . A separate index that covers 20 U.S. cities fell 3.5 percent in June from a year earlier. A 10-city index fell 4.1 percent from a year earlier.

Source: http://biz.yahoo.com/ap/070828/home_price_index.html?.v=10


here is the actual Standard & Poors Housing data link:
http://www2.standardandpoors.com/po...s_csmahp/0,0,0,0,0,0,0,0,0,1,1,0,0,0,0,0.html

 

[charmed855]

Fed minutes: response needed if conditions worsen

Tuesday August 28, 2:01 pm ET
WASHINGTON (Reuters) - The Federal Reserve acknowledged at its last regular meeting that a policy response might be necessary if financial market conditions worsened, minutes of its August 7 meeting, released on Tuesday, show.

"Members expected a return to more normal market conditions, but recognized that the process likely would take some time, particularly in markets related to subprime mortgages," the central bank's policy-setting Federal Open Market Committee said.

"However, a further deterioration in financial conditions could not be ruled out and, to the extent such a development could have an adverse effect on growth prospects, might require a policy response," the Fed said.

 

[FUTURESTRADER]

DWCPF 50% retrace is 633.11, currently at intraday low of 633.55. 50% from start of run on wednesday, 8/15. Same with S&P, right at 50%.

 

[weatherweenie]

08:35 am : S&P futures vs fair value: -7.6. Nasdaq futures vs fair value: -3.0. As expected, Q2 GDP was revised higher. The preliminary read checked in at 4.0% (consensus 4.1%), up from an advance read of 3.1%.
The chain deflator, a key inflation measure, remained unchanged at 2.7%, matching economists' forecasts. Initial claims rose 9K to 334K (consensus 320K), the highest since mid April but still reflective of healthy labor conditions.
The response in stocks has been modestly positive, but underlying credit issues still leave the futures market languishing below fair value and suggests investors will take some of yesterday's broad-based gains off the table.

 

[weatherweenie]

Briefing.com: negative developments tied to the ongoing credit turmoil remain front and center. H&R Block's (HRB) CEO saying that the mortgage lending market may be in the most severe dislocation since the 1930s and that management may prefer a collapse of its Option One divestiture to more losses is exacerbating an already nervous market.
The Fed adding $5.0 bln of temporary reserves to the banking system via 14-day repos reiterates the Fed's commitment to ensure financial markets have adequate liquidity but also leaves investors again questioning the severity of the subprime fallout.

 

[weatherweenie]

Dell Posts 46 Percent Gain in Second-Quarter Earnings on Stronger Sales

DALLAS (AP) -- Dell Inc. said Thursday that preliminary second-quarter earnings jumped 46 percent on stronger sales of enterprise products and services, improved average selling prices and favorable component costs.

http://biz.yahoo.com/ap/070830/earns_dell.html?.v=4

 

[weatherweenie]

08:34 am : S&P futures vs fair value: +17.2. Nasdaq futures vs fair value: +22.8. July personal income rose 0.5% (consensus 0.3%) while personal spending rose 0.4% (consensus 0.3%). The more closely watched core-PCE deflator rose just 0.1% again (consensus 0.2%), which assuages inflation concerns as the year-over-year rate stays at 1.9% and within the Fed's "comfort zone." The futures market is retracing its morning highs, still signaling a strong start for stocks; but the tame inflation data has done little to excite bond traders as the flight-to-quality bid in Treasuries continues to unwind. The 10-year note is down 9 ticks to yield 4.54%.

 

[budnipper1]

Bush is talking on TV right now. So far he says that he urges mortgage lenders to try to help homeowners refinance to save their homes from foreclosure. He also said that it was not the governments job to bail investors out of trouble when they start losing their money.

 

[budnipper1]

Bush is talking on TV right now. So far he says that he urges mortgage lenders to try to help homeowners refinance to save their homes from foreclosure. He also said that it was not the governments job to bail "speculators" out of trouble when they start losing their money.

(correcting mis-quote)

 

[James48843]

Virginia Senator John Warner(R) annouces he will retire and not seek another term at the end of this one.
Most likely will be highly competitive contest.

No word yet from Idaho Senator Larry Craig (R), after colleges call for him to resign. If he does, Idaho's republican governor has already floated a name for a replacement. Idaho Lt. Gov. Jim Risch.
http://www.idaho8.com/Global/story.asp?S=7011685

(How about that- you hold a press conference, say you are going to stay, and the next day the governor already floats names of replacements. Now THAT should be a hint...)

 

[weatherweenie]

Briefing.com: with only 30 minutes left to go, the NYSE is still 100 mln shares away from surpassing 1.0 bln, leaving today’s rally open for interpretation when fund managers return to work next week.

 

[ATCJeff]

Briefing.com: with only 30 minutes left to go, the NYSE is still 100 mln shares away from surpassing 1.0 bln, leaving today’s rally open for interpretation when fund managers return to work next week.

Glad I'm getting out today.

 

[Bullitt]

Price is the only thing that pays.

 

[weatherweenie]

PARIS, Sept 3 (Reuters) - European stocks edged higher on Monday, with the FTSEurofirst closing at a near four-week high, as comments from executives at Barclays and Deutsche Bank reassured investors on the banks' exposure to the troubled U.S. subprime mortgage market.

http://www.reuters.com/article/marketsNews/idINL0376580520070903?rpc=44

 

[Birchtree]

It's time for some members to invest in a nice pair of Timberland hiking boots and begin to contemplate the best route to climb the Big V (Valley) to the intermediate top of SPX at 1670. The longer the journey takes the better it will be, but we have no control of the momentum. Let'er rip.

 

[weatherweenie]

08:35 am : S&P futures vs fair value: +2.3. Nasdaq futures vs fair value: +2.0. Futures indications have strengthened in response to this morning's economic data, now suggesting a slightly higher start for stocks.
As expected, Q2 productivity was revised higher, checking in at 2.6% (consensus 2.4%) from a previous read of 1.8%. Also, with high levels of resource utilization still a Fed focal point as having the potential to sustain inflation pressures, unit labor costs falling to 1.4% from a preliminary read of 2.1% ease wage-based inflation worries.
Separately, initial claims fell 19K to 318K (consensus 330K), which is reflective of a tight job market; but the jobless claims have had less of an impact on trading than the productivity report since Friday's more closely-watched August employment report will provide a clearer picture of labor conditions.

 

[weatherweenie]

NEW YORK (AP) -- Oil prices climbed Thursday on reports of shrinking U.S. supplies of crude and gasoline, and as news of violence in the Middle East and rising tensions in Nigeria unnerved investors.

http://biz.yahoo.com/ap/070906/commodities_review.html?.v=2

 

[weatherweenie]

I know the article was posted previously, but here's a link in case anyone would like it:
http://federalnewsradio.com/index.php?sid=1238113&nid=22

In late August, in a single day, 25,000 Thrift Savings Plan investors moved tens of thousands of dollars from stock market funds into the super-safe treasury securities fund. Most of the IFTs (interfund transactions) involved taking money out of the international stock-indexed I fund and putting it into the G fund. And that wasn't even a record day...

 

[weatherweenie]

Briefing.com

Atlanta Fed President Dennis Lockhart later saying there are no signs that the housing and subprime mortgage market woes are spilling over into other sectors of the economy lent further validation that consumer spending remains healthy.
St. Louis Fed President and voting Fed official Poole, though, said that he sees evidence for a 'further leg down' in housing, that there was "no question" financial problems would worsen, and that the Fed won't be pushed into a decision.