Bill Cara: Week in Review #39 (2007-09-29)

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October 1, 2007

Week in Review #39 (2007-09-29)

On the confidence scale, traders are somewhere between concern that past indiscretions among mortgage loan syndicators and commercial bankers could weigh too heavily on credits markets, causing some financial institutions to fail, and, on the other side, optimism that growth in BRIC economies can replace the ills of the US, UK and Western Europe. The equity market can go either way at this point.

What is for sure is that the credit market problems that surfaced in June will take at least a year and require agreements between the major banks of the world to resolve. In the interim, despite the helping support of central bankers to provide additional liquidity, many financial institutions will fail and/or be taken over by stronger ones.

Muddling through the process, central bankers will try to ensure enough liquidity to help private equity companies to complete the deals they lined up and those that will become available under the present circumstances, and they want to help those financially strong corporations interested in taking on more debt to pay out higher dividends. These deals contribute to what people call the Wealth Effect.

‘Wealth effect’ is an expression that is akin to little more than taking money out of one pocket and putting it into another to induce them to do something they ought not to.

In being aware of the money and handling it, to paraphrase the dim-witted TV commercial of one of Canada’s biggest banks, “you are richer than you think you are”. I say it is dim-witted because it is an obvious attempt to get people who cannot afford to borrow to do so anyway in order to spend on things they may or may not need.

It’s kind of like saying to an alcoholic that it is ok to have a drink after five years absence of substance abuse. The drink may calm the person’s nerves for an hour, and destroy their psyche. In the context of commercial lending, does the bank really care as long as somebody is there to make the payments or collect the loan collateral in the event payments are not?

In other words, ‘wealth effect is part of the psychology of credit markets, a creation of the Sell-side. Just another challenge in the daily life of the Buy-side.

Now we are told that one of the largest and strongest banks of the world, UBS, is going to write off $3.41 billion in loans. I don’t know if that actually means the bank will be taking provisions for loan losses, which is a deduction from earnings and in effect sets the special loans department into action to try to collect on the collateral (meaning tough times for the bank’s customers) or whether it is actually a write-off meaning the bank has decided it cannot collect these debts, or sell them to others who will try to collect, which in effect lowers the shareholders’ capital in the bank.

Usually, when you see one or more of the major banks talking like this, it means they all will, and that means that all bank customers are going to get squeezed, and in the process end up having banks seize assets where loans are not being repaid as per earlier agreements. Typically these things happen in Bull markets. They happen once every 10 or 15 years and in my whole life, I haven’t seen it happen in a Bull market yet.

Credit squeezes by banks are bad for embattled home-owners too because high bid prices for homes are the result of the bidders being able to finance the purchase through available credit. When credit of a part of the market is squeezed, like for sub-prime borrowers, it is almost always the case that there is a squeeze on the borrowing practices of the typical prime rate borrowers as well. That is what is happening today.

So, what happens is that asset prices fall quickly when potential buyers cannot borrow enough to complete the deal. In 1990, my parents bought the country home and property of their next-door neighbor for $300,000 cash that until the credit squeeze a few months earlier held a $1.1 million mortgage against it. In a credit squeeze, cash is king.

For a couple years, I could see that cash would be king because I saw too many dumb TV commercials like, “You are richer than you think you are!” That was just a different slant than the years 1999-2000 when the discount brokers were running TV ads about truck drivers using their market winnings to buy Caribbean islands – one little old lady even bought a country!

Well, you know the rest of that story. The truck drivers and little old ladies were then roundly criticized for being stupid enough to day trade their stocks. The industry took no responsibility. While the pickings were good, they did take their bonuses.

Same thing today. Billions of dollars in bonuses are being paid by banks to bankers while new home-owners and real-estate investors are being criticized for the lying part of the banks’ “Liar Loan” problem.

You see the reason for my analogy to the banker giving a drink to an AA member? At the end of the day, we all must take responsibility and pay the piper. But, banks will continue to bonus bankers, and when there are subsequent losses from the business these bankers initiated, the shareholders will take the hit.

Moreover, if Banks A and B operated foolishly, Bank C will buy them out at fire-sale prices. The rich will get richer. In a horse race, I say always find the best horse and jockey – not the best story in the newspaper, but the principals with the superior trackrecords. That’s because, in life, what goes around will come around.

My son and new daughter-in-law were married on the weekend. It is a new life but for them to succeed in the future they must learn from the mistakes others have made in the past. Same thing applies to traders.

If you continue to act like traders who were losers in the past you too will be a loser in the future.

If you thought that watching a couple years of “You are richer than you think you are” TV commercials was interesting and informative, then you are a loser. If you thought that the Government of Canada, as an example, was doing the right thing in their TV commercials by telling young people to sign up for the fun and travel of the armed forces then you are a loser. The government stopped running those “fun” commercials when the nation’s young people started to come home in body bags.

There is a reality to life, and you are at risk if you choose to ignore it, and instead believe the stories of goldilocks and make-believe. Credulity syndrome is the term I use for losers. Too many people are afflicted.

When banks tighten, and central banks liquefy, as they are doing today, having cash is an important asset, but there is nothing so important as having gold and silver money at times like that. The more paper money that is printed, the more it is depreciated (because much of it is misspent/wasted), and the higher the value of gold and silver, and the bigger are the winners who hold it. The losers will continue to be those who borrow to spend unnecessarily – individuals, corporations and governments alike.

Losers in the markets will be traders who do not recognize that this is a bad time to be investing in companies that make or sell goods and services that are not essential to sustaining life, or on financial institutions that lend (since this is a time these companies are bent on collecting and having to write off bad debts).

I will sum up that this was a week in transition. People, like my son and daughter-in-law, were married with great hopes for their future, but also with the need to stay grounded by learning from the past mistakes of others. Traders who are new at this, let this be the first week of the rest of your life. Keep your dreams alive, but don’t ignore the lessons of the past.

For sure, Sell-side lenders and dream merchants are not going to tell you that. They are too busy trying to get theirs. That’s life.

International Economics Review

Econoday Weekly International Report

US Economic Calendar for next week

US Equity Markets Review

DJIA (interactive) chart

Traders are taking note of a possible double top.

On Friday, the DJIA lost -17 points (-0.12 pct) to close at 13895, up +75 points from the previous Friday’s 13820.

The broad market indexes are now well above both the 50-day and 200-day Moving average technical lines of resistance, and the volume is picking up, which means that traders are generally less cautious. The Daily RSI-7 data (see from Chris) shows the market is over-bought. This combo warrants close monitoring.

We have to watch the post-quarter trading for signs of a market sell-off. As I pointed out a week ago, selling into strength the stocks in your portfolio that have already had a Sell Alert and then a subsequent big run-up in price to a second Sell Alert is usually the right decision.

NASDAQ Composite (interactive) chart

On Friday, the Nasdaq Composite had a loss of -8 points (-0.30 pct) to close at 2701, which is a gain on the week of +30 points.

Table 13: International equities via an ETF perspective (ie, $USD)

Sorted by 1-Week Price Performance
Symbol Close 1Day
Change 1Day
%Change 1W
%Change 2W
%Change 4W
%Change YTD
%Change 3M
%Change 6M
%Change 12M
%Change

EWZ 74.09 -0.49 -0.66% 6.88% 15.59% 24.92% 58.65% 21.78% 52.73% 95.59%

FXI 180.00 -2.09 -1.15% 6.84% 15.54% 23.27% 54.64% 39.55% 75.95% 121.54%

IFN 54.30 -0.23 -0.42% 6.76% 9.26% 19.81% 19.76% 27.61% 35.51% 23.41%

TRF 68.67 -0.83 -1.19% 6.19% 11.42% 11.97% -22.45% 2.66% -2.32% 1.78%

EWJ 14.32 -0.03 -0.21% 3.92% 5.45% 3.99% 0.85% -0.56% -2.98% 6.15%

QQQQ 51.41 -0.17 -0.33% 2.08% 4.45% 6.37% 18.89% 8.14% 16.89% 26.25%

EWC 32.73 0.06 0.18% 1.77% 5.28% 11.25% 32.51% 11.21% 25.07% 36.15%

EWU 25.80 0.15 0.57% 1.48% 4.39% 6.68% 9.54% 1.40% 7.17% 17.52%

IEV 118.79 0.14 0.11% 1.18% 4.92% 6.58% 12.49% 2.37% 10.14% 22.71%

SPY 152.58 -0.51 -0.33% 0.40% 2.48% 4.40% 7.93% 1.40% 6.80% 14.09%

Japanese equity market ETF: EWJ

Here is the Japanese (EWJ) equity market ETF Monthly, Weekly and Daily data charts:

Interactive EWJ Monthly data:

Interactive EWJ Weekly data:

Weekly EWJ

Interactive EWJ Daily data:

Daily EWJ

U.K. equity market ETF

Here is the United Kingdom (EWU) equity market ETF Monthly, Weekly and Daily data charts:

Interactive EWU Monthly data:

Interactive EWU Weekly data:

Weekly EWU Data

Interactive EWU Daily data:

EWU Daily data:

Daily EWU Data

Canada’s equity market

Here is the Canadian (EWC) equity market ETF Monthly, Weekly and Daily data charts:

Interactive EWC Monthly data:

Interactive EWC Weekly data:

Weekly EWC Data

Interactive EWC Daily data:

Daily EWC Data

The US equity market Sector ETF Summary

The tables I show are for ten (GICS) Sector Index Funds (ETF’s) only, but they cover the full spectrum of the equity market.

This week it was a case of 4 sector ETFs up, 1 flat and 5 down. Basic Materials (XLB) was #1 again, but Energy (XLE) dropped from #2 to #9. Financials (XLF) dropped from #6 to #10.

Table 1: Cara ETF List is sorted by price performance Week over Week (W/W), i.e. 1W%N.

Sorted by 1-Week Price Performance
Symbol Close 1Day
Change 1Day
%Change 1W
%Change 2W
%Change 4W
%Change YTD
%Change 3M
%Change 6M
%Change 12M
%Change

XLB 42.12 -0.37 -0.87% 1.32% 6.44% 8.70% 21.70% 5.04% 10.64% 32.33%

XLP 27.94 0.05 0.18% 1.01% 2.05% 4.14% 6.32% 3.21% 5.51% 9.53%

XLI 41.00 0.14 0.34% 0.91% 3.69% 5.59% 16.38% 5.18% 14.24% 23.23%

IYH 70.79 -0.29 -0.41% 0.08% 1.64% 3.78% 6.52% 0.91% 5.81% 8.31%

IYZ 33.85 -0.18 -0.53% 0.00% 3.74% 2.76% 14.13% 0.39% 8.77% 22.73%

SMH 38.30 -0.06 -0.16% -0.73% 3.12% 2.41% 14.09% -0.75% 11.86% 12.12%

XLU 39.93 -0.50 -1.24% -0.97% 0.58% 3.34% 8.45% 1.47% -0.08% 15.94%

XLY 36.73 0.08 0.22% -1.00% -0.05% 0.58% -4.65% -6.68% -3.92% 4.50%

XLE 74.94 -0.56 -0.74% -1.00% 3.04% 8.77% 32.45% 9.00% 23.36% 40.34%

XLF 34.20 -0.26 -0.75% -1.16% 0.97% 2.55% -7.37% -6.15% -4.47% -1.16%

You can do this table yourself by entering the following string into the Summary window at Billcara2.com and then clicking on the link for Performance. XLE XLB XLI XLY XLP IYH XLF SMH IYZ XLU . You can also add more ETF’s – up to 30 in total.

For a list of components to any ETF, go to the AMEX.com web site, and click on ETF’s.

10 (energy: XLE)

ETF Chart for Energy:XLE

15 (basic materials: XLB)

ETF Chart for Basic Materials:XLB

20 (industrial: XLI)

ETF Chart for Industrial:XLI

25 (consumer discretionary: XLY)

ETF Chart for Energy:XLY

30 (consumer staples: XLP)

ETF Chart for Consumer Staples:XLP

35 (healthcare: IYH)

ETF Chart for Health Care:IYH

40 (financial: XLF)

ETF Chart for Financial:XLF

45 (technology, semiconductor: SMH)

ETF Chart for Technology, Semiconductor:SMH

50 (telecom: IYZ)

ETF Chart for Telecom:IYZ

55 (utilities: XLU)

ETF Chart for Utilities:XLU

Individual Sector ETF Review

Sector 10 (energy: XLE, IYE, VDE, OIH, PBW and IXC)

Here’s the XLE Monthly, Weekly and Daily data charts:

XLE Monthly data:

XLE Monthly Data

XLE Weekly data:

XLE Weekly Data

XLE Daily data:

XLE Daily Data

Energy (XLE) was the #9 performer this week, down -1.00 pct, closing at 74.94. A week ago, it was #2, up +4.08 pct. XLE was #1 performer for three weeks in a row before that, and I started to say I thought the price was over-bought.

China National Offshore Oil Co (CEO +7.50 pct) was the big winner again this week, as it was over the past 4 weeks (+42.13 pct). Smart traders will be watching for a Sell-alert to realize their gains, and move into cash (or into over-sold but recovering stocks).

For the past year (52-weeks), CEO is up +101.3 pct.

Table 2: Senior oil & gas equities

Sorted by 1-Week Price Performance
Symbol Close 1Day
Change 1Day
%Change 1W
%Change 2W
%Change 4W
%Change YTD
%Change 3M
%Change 6M
%Change 12M
%Change

CEO 166.43 3.24 1.99% 7.50% 25.47% 42.13% 76.55% 51.99% 98.39% 101.34%

PBR 75.50 -1.41 -1.83% 3.28% 12.50% 27.34% 51.52% 25.29% 58.98% 84.82%

XOM 92.56 -0.41 -0.44% 0.27% 4.39% 8.38% 24.90% 10.88% 22.26% 37.88%

TOT 81.03 -0.77 -0.94% -0.50% 3.98% 9.93% 14.18% 4.17% 17.78% 23.75%

IMO 49.56 0.45 0.92% -1.16% 4.34% 16.01% 38.98% 8.35% 33.01% 48.61%

SU 94.81 -0.62 -0.65% -1.16% -1.57% 8.73% 28.28% 8.45% 27.72% 32.38%

ECA 61.85 0.51 0.83% -1.21% 0.18% 6.55% 36.41% -0.48% 21.51% 31.96%

CVX 93.58 0.07 0.07% -1.33% 3.23% 7.33% 31.86% 11.55% 26.17% 45.76%

STO 33.92 0.46 1.37% -2.02% 6.47% 20.24% 32.04% 14.75% 26.57% 37.72%

Integrated Oil & Gas - Canada

Oil & Gas Exploration & Production -Canada

Sector 15 (basic materials: IYM, XLB, IGE and VAW)

Here’s the XLB Monthly, Weekly and Daily data charts:

XLB Monthly data:

XLB Monthly Data

XLB Weekly data:

XLB Weekly Data

XLB Daily data:

XLB Daily Data

XLB (Basic Materials) gained ++1.32 pct on the week to close at 42.12.

Base metal miners like Brazil’s CVRD (RIO) were strong. RIO jumped +11.43 pct this week, and +24.51 pct over two weeks. Yes, the fundamentals are improving, but those kind of gains must be realized or else they might be given back.

Table 3: Senior metals and steel equities:

Sorted by 1-Week Price Performance
Symbol Close 1Day
Change 1Day
%Change 1W
%Change 2W
%Change 4W
%Change YTD
%Change 3M
%Change 6M
%Change 12M
%Change

RIO 33.93 -0.05 -0.15% 11.43% 24.51% -29.27% 17.73% -23.58% -8.32% 60.73%

BHP 78.60 0.95 1.22% 8.37% 19.20% 27.16% 102.21% 35.85% 62.50% 104.47%

GGB 26.22 0.00 0.00% 4.88% 13.21% 14.40% 59.68% 5.22% 47.14% 96.11%

AA 39.12 0.12 0.31% 4.60% 10.26% 8.22% 33.38% 0.38% 15.06% 40.97%

RTP 343.40 4.80 1.42% 4.51% 14.91% 29.88% 68.25% 14.70% 51.28% 80.08%

MT 78.36 -0.19 -0.24% 2.96% 14.81% 21.58% 92.06% 26.55% 49.43% 131.63%

TS 52.62 -0.26 -0.49% 1.49% 13.72% 12.99% 8.45% 7.83% 19.46% 47.15%

NUE 59.47 -1.07 -1.77% -0.05% 4.21% 14.63% 9.12% 3.09% -9.48% 21.02%

TCK 47.71 0.15 0.32% -0.65% 11.34% 16.28% -31.10% 11.08% -32.91% -24.39%

PKX 178.77 -2.36 -1.30% -1.78% 8.77% 20.72% 125.07% 50.84% 79.27% 176.73%

Sector 20 (industrial: IYJ, XLI, VIS, and IYT)

Here’s the XLI Monthly, Weekly and Daily data charts:

XLI Monthly data:

XLI Monthly Data

XLI Weekly data:

XLI Weekly Data

XLI Daily data:

XLI Daily Data

Table 4: Senior capital goods makers and transportation:

Sorted by 1-Week Price Performance
Symbol Close 1Day
Change 1Day
%Change 1W
%Change 2W
%Change 4W
%Change YTD
%Change 3M
%Change 6M
%Change 12M
%Change

ABB 26.23 0.32 1.24% 2.54% 10.21% 9.06% 47.19% 18.15% 51.97% 98.56%

BA 104.99 -0.47 -0.45% 2.34% 5.68% 8.40% 17.74% 10.92% 15.99% 32.21%

MMM 93.58 0.19 0.20% 2.07% 5.12% 4.72% 19.58% 7.40% 21.26% 25.36%

HON 59.47 0.27 0.46% 1.33% 5.37% 5.65% 31.86% 5.61% 27.26% 44.94%

UTX 80.48 -0.21 -0.26% 1.32% 5.70% 8.99% 28.13% 12.56% 21.74% 27.46%

FDX 104.75 0.11 0.11% 0.62% -4.06% -3.87% -4.57% -6.14% -4.82% -4.95%

GE 41.40 0.01 0.02% 0.36% 2.60% 7.81% 9.03% 8.78% 15.67% 17.15%

CAT 78.43 0.96 1.24% 0.35% 7.20% 5.05% 28.24% -1.36% 17.27% 19.41%

ERJ 43.92 -0.05 -0.11% -0.30% 5.05% -0.14% 7.70% -9.80% -1.94% 10.02%

XLI (Industrials) gained +0.91 pct this week to close at 41.00.

Switzerland’s answer to General Electric is ABB, which was up +2.54 pct W/W and +10.21 pct over two weeks. That is a huge increase for a mature large cap company. Is global forex that good? Certainly I like the business this company does, and its management, financial strength, and operating metrics, but the stock is very expensive now.

Selling, however, is best done with the help of Sell-alerts.

Sector 25 (consumer discretionary: XLY, IYC and VCR)

Here’s the XLY Monthly, Weekly and Daily data charts:

XLY Monthly data:

XLY Monthly Data

XLY Weekly data:

XLY Weekly Data

XLY Daily data:

XLY Daily Data

Consumer Discretionary (XLY) was another weak performer this week, losing -1.00 pct W/W to close at 36.73.

Nike (NKE) was strong (+2.44 pct W/W), whereas the losers were Whirlpool (WHR), Starbucks (SBUX) and JC Penny (JCP).

Table 5: Senior consumer discretionary equities

Sorted by 1-Week Price Performance
Symbol Close 1Day
Change 1Day
%Change 1W
%Change 2W
%Change 4W
%Change YTD
%Change 3M
%Change 6M
%Change 12M
%Change

NKE 58.66 0.49 0.84% 2.44% 2.50% 5.20% 20.13% 0.63% 10.10% 33.14%

BC 22.86 -0.09 -0.39% 2.19% 3.86% -8.12% -28.38% -30.50% -28.14% -28.38%

TM 116.86 0.98 0.85% 1.56% 3.25% 3.15% -13.63% -5.64% -10.97% 7.61%

EBAY 39.02 -0.25 -0.64% 0.05% 3.20% 16.13% 29.33% 21.63% 17.11% 43.46%

DIS 34.39 0.18 0.53% -0.61% 2.47% 2.75% 0.56% 0.35% -0.78% 10.79%

CCL 48.43 -0.66 -1.34% -1.59% 8.73% 7.62% -4.95% -0.14% 2.22% 4.47%

WHR 89.10 0.83 0.94% -3.37% -2.30% -6.36% 5.24% -20.91% 4.38% 4.52%

SBUX 26.20 -0.77 -2.86% -4.62% -5.21% -4.20% -25.67% 0.27% -17.43% -23.99%

JCP 63.37 -0.44 -0.69% -4.68% -1.32% -3.97% -18.82% -11.68% -22.58% -8.33%

Sector 30 (consumer staples: XLP, VDC, RTH and IYK)

Here's the XLP Monthly, Weekly and Daily data charts:

XLP Monthly data:

XLP Monthly Data

XLP Weekly data:

XLP Weekly Data

XLP Daily data:

XLP Daily Data

Table 6: Senior consumer staples equities

Sorted by 1-Week Price Performance
Symbol Close 1Day
Change 1Day
%Change 1W
%Change 2W
%Change 4W
%Change YTD
%Change 3M
%Change 6M
%Change 12M
%Change

WFMI 48.96 0.82 1.70% 8.73% 12.86% 10.89% 7.65% 26.02% 8.87% -20.35%

WAG 47.24 -0.69 -1.44% 4.03% 4.33% 5.87% 2.54% 7.19% 0.64% 4.40%

PEP 73.26 0.64 0.88% 2.55% 5.32% 7.96% 16.80% 12.41% 16.38% 11.15%

KO 57.47 0.14 0.24% 1.63% 1.90% 7.62% 18.30% 9.59% 19.68% 28.54%

MO 69.53 0.05 0.07% 1.44% 3.73% 0.40% 7.10% -0.95% 8.90% 19.88%

PG 70.34 0.24 0.34% 1.37% 3.73% 8.20% 8.99% 14.50% 11.17% 12.13%

DEO 87.73 -0.07 -0.08% 1.15% 4.35% 4.88% 10.31% 3.07% 10.27% 22.29%

ABV 73.13 0.83 1.15% 0.92% 6.03% 8.47% 48.94% 7.06% 37.62% 62.15%

BUD 49.99 -0.27 -0.54% -1.15% -0.38% 3.29% 1.56% -2.89% -0.85% 5.42%

WMT 43.65 0.04 0.09% -1.31% 0.76% 0.76% -8.20% -9.93% -8.09% -11.82%

XLP (consumer staples stocks) were a relatively strong #2 performer, gaining +1.01 pct W/W to close at 27.94.

Whole Food Markets (WFMI), having cleared some legal issues related to a take-over, was up +8.73 pct W/W (+12.86 pct in two weeks).

Sector 35 (healthcare: IYH, XLV, VHT, IXJ, and IBB)

Here’s the IYH Monthly, Weekly and Daily data charts:

IYH Monthly data:

IYH Monthly Data

IYH Weekly data:

IYH Weekly Data

IYH Daily data:

IYH Daily Data

Table 7: Senior healthcare equities

Sorted by 1-Week Price Performance
Symbol Close 1Day
Change 1Day
%Change 1W
%Change 2W
%Change 4W
%Change YTD
%Change 3M
%Change 6M
%Change 12M
%Change

AET 54.27 0.27 0.50% 3.69% 5.42% 7.53% 26.56% 8.32% 21.36% 40.52%

AMGN 56.57 0.01 0.02% 2.08% 0.44% 12.96% -17.30% 1.93% 0.55% -21.58%

JNJ 65.70 0.16 0.24% 0.89% 3.96% 6.66% -1.05% 6.92% 9.45% 1.36%

BMET 45.99 0.06 0.13% 0.24% 0.31% 0.48% 10.90% 1.05% 8.47% 41.68%

NVS 54.96 0.29 0.53% -0.25% 1.14% 5.23% -5.47% -0.94% -2.95% -6.16%

BMY 28.82 -0.19 -0.65% -0.62% 1.55% 0.07% 9.25% -10.08% 3.67% 15.28%

PFE 24.43 -0.32 -1.29% -0.65% 0.58% -0.49% -7.07% -4.61% -4.16% -14.01%

DNA 78.02 -1.05 -1.33% -1.71% -1.23% 6.11% -4.62% 4.95% -5.49% -6.42%

GSK 53.20 0.02 0.04% -1.90% -0.39% 3.87% -1.13% 1.01% -2.62% -1.10%

UNH 48.43 -0.83 -1.68% -2.97% -2.97% -1.26% -7.88% -6.42% -13.29% -1.32%

IYH (healthcare) gained +0.08 pct W/W to close at 70.79, a gain of six cents. Yet, IYH was performing leader #4.

Aetna (AET +3.7 pct W/W) and United Health (UNH -3.0 pct) were going in opposite directions.

Sector 40 (financial: IYG, IYF, XLF, VFH, IXG, VNQ, RWR, IYR, and ICF)

Here’s the XLF Monthly, Weekly and Daily data charts:

XLF Monthly data:

XLF Monthly Data

XLF Weekly data:

XLF Weekly Data

XLF Daily data:

XLF Daily Data

Table 8: Senior financial company equities

Sorted by 1-Week Price Performance
Symbol Close 1Day
Change 1Day
%Change 1W
%Change 2W
%Change 4W
%Change YTD
%Change 3M
%Change 6M
%Change 12M
%Change

GS 216.74 -0.04 -0.02% 3.22% 13.72% 26.47% 7.98% -1.18% 3.27% 28.25%

HBC 92.60 -0.35 -0.38% 0.04% 2.99% 3.94% -0.40% 0.02% 6.01% 1.07%

CS 66.33 0.36 0.55% -0.09% 2.98% 2.60% -5.39% -6.42% -9.40% 13.58%

DB 128.39 -0.06 -0.05% -0.69% 2.63% 5.58% -5.14% -10.59% -3.29% 6.12%

UBS 53.25 0.14 0.26% -1.48% 2.66% 3.28% -13.26% -11.25% -10.38% -9.94%

LEH 61.73 -0.80 -1.28% -1.55% 3.75% 14.80% -21.49% -18.98% -13.98% -15.86%

C 46.67 -0.21 -0.45% -1.77% 0.06% 0.95% -15.53% -9.92% -8.60% -6.60%

MS 63.00 -1.55 -2.40% -2.23% -4.70% 4.72% -22.81% -26.16% -20.72% -12.97%

JPM 45.82 -0.39 -0.84% -2.78% 0.61% 4.21% -4.68% -6.95% -5.66% -2.18%

MER 71.28 -0.26 -0.36% -4.62% -4.51% -1.25% -23.85% -17.37% -15.08% -9.42%

The Financial ETF (XLF) lost -1.16 pct W/W to close at 34.20. On Friday, the loss was -0.75 pct.

I would not touch Financials right now unless I wanted to become a millionaire starting out with two.

Sector 45 (technology: IGM, IGV, IGW, XLK, VGT, IYW, IGN, IXN, MTK and SMH)

Here’s the SMH Monthly, Weekly and Daily data charts:

SMH Monthly data:

SMH Monthly Data

SMH Weekly data:

SMH Weekly Data

SMH Daily data:

SMH Daily Data

Table 9: Senior technology equities

Sorted by 1-Week Price Performance
Symbol Close 1Day
Change 1Day
%Change 1W
%Change 2W
%Change 4W
%Change YTD
%Change 3M
%Change 6M
%Change 12M
%Change

CTSH 79.79 0.05 0.06% 5.17% 10.71% 10.93% 2.61% 4.93% -13.99% 6.30%

ADBE 43.66 0.21 0.48% 4.08% 0.58% 3.41% 9.37% 7.88% 1.80% 14.62%

INFY 48.39 -0.19 -0.39% 3.80% 2.50% 4.20% -13.31% -4.82% -6.33% 0.31%

QCOM 42.26 0.03 0.07% 3.50% 7.18% 8.14% 12.81% -2.67% -0.87% 10.83%

SNDK 55.10 0.32 0.58% 2.88% 7.43% 0.80% 32.07% 13.58% 22.96% 1.72%

CSCO 33.13 -0.10 -0.30% 2.57% 4.97% 5.41% 19.43% 21.49% 27.77% 41.88%

ADSK 49.97 0.17 0.34% 2.57% 5.07% 10.07% 23.20% 4.72% 32.20% 43.96%

SAP 58.67 0.89 1.54% 0.05% 2.05% 11.18% 10.28% 14.26% 29.69% 17.88%

INTC 25.86 0.10 0.39% -0.04% 3.73% 2.29% 27.08% 8.70% 35.68% 26.83%

ORCL 21.65 0.02 0.09% -1.50% 7.87% 7.13% 23.64% 9.95% 17.22% 20.75%

This week, SMH (semi-conductors) lost -0.73 pct to 38.30.

Sector 50 (telecom: IYZ, VOX and IXP)

Here’s the IYZ Monthly, Weekly and Daily data charts:

IYZ Monthly data:

IYZ Monthly Data

IYZ Weekly data:

IYZ Weekly Data

IYZ Daily data:

IYZ Daily Data

IYZ (telecommunications) was flat on the week.

Sector 55 (utilities: IDU, XLU, and VPU)

Here’s the XLU Monthly, Weekly and Daily data charts:

XLU Monthly data:

XLU Monthly Data

XLU Weekly data:

XLU Weekly Data

XLU Daily data:

XLU Daily Data

This week, XLU (Utilities) lost -0.97 pct, to close at 39.3, but on Friday the loss was -1.24 pct.

Bonds & Yields Review

Table 10: US Treasury Yields

US Treasury Bonds
Maturity Yield Yesterday Last Week Last Month

3 Month 3.64 3.56 3.62 3.81

6 Month 3.91 3.87 3.92 4.13

2 Year 3.97 3.94 4.02 4.15

3 Year 4.01 3.98 4.09 4.17

5 Year 4.24 4.21 4.29 4.30

10 Year 4.58 4.57 4.62 4.56

30 Year 4.83 4.83 4.88 4.88

Municipal Bonds
Maturity Yield Yesterday Last Week Last Month

2yr AA 3.40 3.37 3.40 3.64

2yr AAA 3.49 3.45 3.48 3.55

2yr A 3.47 3.43 3.46 3.53

5yr AAA 3.48 3.48 3.53 3.58

5yr AA 3.49 3.52 3.54 3.67

5yr A 3.70 3.70 3.75 3.81

10yr AAA 3.77 3.78 3.78 4.44

10yr AA 3.78 3.87 3.76 4.44

10yr A 3.90 3.91 3.91 4.67

20yr AAA 4.33 4.45 4.48 4.66

20yr AA 4.73 4.85 4.98 4.71

20yr A 4.33 4.46 4.76 4.73

Corporate Bonds
Maturity Yield Yesterday Last Week Last Month

2yr AA 4.81 4.79 4.85 4.90

2yr A 4.89 4.86 5.08 4.92

5yr AAA 5.06 5.03 5.10 5.06

5yr AA 5.14 5.11 5.18 5.32

5yr A 5.21 5.19 5.28 5.27

10yr AAA 5.38 5.37 5.42 5.62

10yr AA 5.79 5.77 5.84 5.75

10yr A 5.78 5.79 5.89 5.80

20yr AAA 5.96 5.97 6.03 6.18

20yr AA 6.33 6.34 5.97 6.30

20yr A 6.29 6.30 6.36 6.32

Within the US Treasury market, the yields dropped between -4 and -5 basis points, which gave a small lift to Bonds.

The yield for the 3-month T-Bills increased +2bp to 3.64 pct.

Here is the $USB 30-year Treasury Bond chart.

Interest rates and bond yields.

TNX0X Weekly Data

IRX0X Weekly Data

Interactive Daily data charts:

TNX0X Daily Data

IRX0X Daily Data

Interactive Chart of Interest rates and bond yields.

TLT gained +0.94 pct W/W to 88.72.

US Bond Funds -- Interactive Monthly Data Charts

SHY Monthly data series chart:

IEF Monthly data series chart:

TLT Monthly data series chart:

AGG Monthly data series chart:

LQD Monthly data series chart:

TIP Monthly data series chart:

US Bond Funds -- Interactive Weekly Data Charts

SHY Weekly data series chart:

IEF Weekly data series chart:

TLT Weekly data series chart:

AGG Weekly data series chart:

LQD Weekly data series chart:

TIP Weekly data series chart:

US Bond Funds -- Interactive Daily Data Charts

SHY Daily data series chart:

IEF Daily data series chart:

TLT Daily data series chart:

AGG Daily data series chart:

LQD Daily data series chart:

TIP Daily data series chart:

Table 11: Interest-sensitive securities

Sorted by 1-Week Price Performance.
Symbol Close 1Day
Change 1Day
%Change 1W
%Change 2W
%Change 4W
%Change YTD
%Change 3M
%Change 6M
%Change 12M
%Change

TLT 88.72 0.20 0.23% 0.94% -1.32% -0.08% -0.39% 5.22% -0.03% -1.02%

IEF 83.88 0.03 0.04% 0.54% -0.50% -0.29% 1.45% 3.91% 0.67% 0.68%

TIP 102.03 0.08 0.08% 0.42% -0.17% 0.80% 2.82% 3.53% 0.69% 0.85%

AGG 100.02 0.15 0.15% 0.31% 0.12% 0.26% 0.11% 1.81% -0.35% -0.19%

SHY 81.26 -0.18 -0.22% 0.10% 0.26% 0.17% 1.52% 1.55% 0.99% 1.12%

FRE 59.01 -0.98 -1.63% -2.22% 2.86% -1.76% -13.08% -4.06% -3.20% -9.87%

FNM 60.81 -1.19 -1.92% -3.05% -0.77% -4.09% 1.59% -8.42% 8.47% 10.34%

CFC 19.01 0.14 0.74% -3.06% -2.11% -3.21% -54.86% -47.80% -45.23% -45.40%

Freddie Mac (FRE -22 pct), Fannie Mae (FNM -3.05 pct) and Countrywide Financial (CFC -3.06 pct) were losers this week.

Traders are getting the message that the problems of the housing market and mortgage loan market in the US will take maybe a year or two to resolve.

Consumer Finance -USA -- Interactive Weekly Data Charts

Consumer Finance -USA -- Interactive Daily Data Charts

Commodities Review

$CRB index gained +0.16 pct W/W to close at 333.67. There has been a succession of five W/W gains.

The 50-day Moving Average is now at 316.40 and the 200-day MA is 310.99.

$CRB Index

Open Futures Contracts

Interactive Chart of Weekly CRB Commodities Index:

CRB Commodities Index - Weekly Chart

Interactive Chart of Daily CRB Commodities Index:

CRB Commodities Index - Daily Chart

Oil Review

The Crude Oil futures market ($WTIC in the US for Light Sweet Crude called West Texas Intermediate) gained +0.04/bbl (+0.05 pct W/W) to close at 81.66.

The 50d MA for $WTIC is 75.49 and the 200d MA is 66.18, so Oil is now well above both the 50d MA and 200d MA lines.

Here is the e-miNY Sept-07 Crude Oil chart.

Interactive Chart of Weekly Crude Oil:

Crude Oil- Weekly Chart

Interactive Chart of Daily Crude Oil:

Crude Oil- Daily Chart

Gold & Precious Metals Review

This week, $GOLD rallied a further 11.10 (+1.50 pct W/W), and $SILVER rocketed another +0.30 (+2.20 pct). $GOLD is now at 750.00 (which is a long-term cycle high close), and the 50day MA is now 693.33 and the 200d MA is 667.81.

Remember my words from last week:

Onwards and upwards until it doesn’t. For clues to that watch to see if the Euro declines and the USD lifts. Watch to see a sell-off in the $XAU goldminers share index. It’s coming – I just don’t know when. Months ago, I opined it would top out at about 750 for this cycle, and then in the next cycle start to rally again to over $1000, after central banks start talking about a new General Agreement on Currencies, and China agrees to release the tight link to the USD. In the meantime, prices will be volatile. Further FOMC decisions to cut rates will boost gold.

Spot gold chart for the week

Interactive Chart of Weekly Gold EOD Continuous Contract Index:

GOLD EOD Continuous Contract Index - Weekly Chart

Interactive Chart of Daily Gold EOD Continuous Contract Index:

GOLD EOD Continuous Contract Index- Daily Chart

Interactive chart of recent trading for the Gold Bullion index.

Spot silver chart for the week

Interactive daily data

This week, $SILVER gained +$0.30/oz (+2.20 pct) to close at 13.92.

The 50d MA is 12.76 and the 200d MA is 13.16.

Interactive Chart of Weekly Silver EOD Continuous Contract Index:

SILVER EOD Continuous Contract Index - Weekly Chart

Interactive Chart of Daily Silver EOD Continuous Contract Index:

SILVER EOD Continuous Contract Index- Daily Chart

Interactive chart of the Silver Bullion index.

Spot platinum chart for the week

Interactive Chart of Weekly Platinum EOD Continuous Contract Index:

PLAT EOD Continuous Contract Index - Weekly Chart

Interactive Chart of Daily Platinum EOD Continuous Contract Index:

PLAT EOD Continuous Contract Index- Daily Chart

Interactive chart of the Platinum metal index.

This week, $PLAT gained +33.80/oz (+2.53 pct) to close at 1369.90. A week ago, $PLAT gained +32.30/oz (+2.48 pct).

The 50d MA is 1296.13 and the 200d MA is 1257.41.

Spot palladium chart for the week

Interactive Chart of Weekly Palladium EOD Continuous Contract Index:

PALL EOD Continuous Contract Index - Weekly Chart

Interactive Chart of Daily Palladium EOD Continuous Contract Index:

PALL EOD Continuous Contract Index- Daily Chart

Interactive chart of the Palladium metal index.

This week, $PALL gained +9.40 (+2.74 pct) to close at 351.95.

The 50d MA is 349.52 and the 200d MA is 356.60, so this is one metal that still has not broken out.

It could be an industry demand shift for the metal, something somebody wrote to me about recently. Comments welcome.

Interactive Chart of Weekly Copper EOD Continuous Contract Index:

COPPER EOD Continuous Contract Index - Weekly Chart

Interactive Chart of Daily Copper EOD Continuous Contract Index:

COPPER EOD Continuous Contract Index- Daily Chart

Interactive chart of the Copper metal index.

This week, $COPPER gained +4.75 (+1.32 pct) to close at 364.00.

The 50d MA of $COPPER is 343.26 and the 200d MA is 320.32, so the current price (364.00) is now above both the 50d MA and 200d MA.

Table 12: Senior gold equities

Sorted by 1-Week Price Performance
Symbol Close 1Day
Change 1Day
%Change 1W
%Change 2W
%Change 4W
%Change YTD
%Change 3M
%Change 6M
%Change 12M
%Change

BVN 47.78 -2.46 -4.90% 4.14% 11.79% 29.80% 73.05% 31.59% 60.39% 69.49%

GG 30.56 0.90 3.03% 1.06% 11.70% 32.24% 11.78% 29.22% 22.78% 28.03%

ABX 40.28 1.10 2.81% 0.55% 8.28% 28.32% 35.03% 40.50% 39.33% 29.89%

GFI 18.09 0.03 0.17% 0.00% 7.81% 21.57% -1.31% 15.00% 0.61% -2.95%

AEM 49.80 1.66 3.45% -0.02% 3.45% 15.71% 27.95% 41.88% 36.51% 53.00%

KGC 14.98 0.03 0.20% -3.23% 7.85% 27.71% 31.17% 28.92% 8.39% 21.20%

MDG 33.10 0.83 2.57% -3.41% 8.81% 20.94% 25.90% 35.66% 31.35% 31.30%

NEM 44.73 0.20 0.45% -5.95% -1.37% 7.73% 1.20% 15.55% 4.63% 3.69%

AUY 11.78 0.24 2.08% -6.58% -0.08% 8.27% -4.46% -2.97% -18.14% 22.84%

This week, $XAU lost -2.80 (-1.53 pct) to close at 168.75.

The 50d MA is 148.89 and the 200d MA is 141.76.

I don’t think the public is even involved at this point. These stocks will go much higher, but watch the spec companies (ie, the explorers) and the ones like Western Goldfields that are ramping up new production.

Do not forget to take part profits after major run-ups, and to re-set stop losses.

To watch the moves in precious metal miners, you will have to monitor the individual stock charts, preferably in real-time, as follows:

NEM ABX AU GFI GG HMY AUY KGC BVN
Interactive Daily data
Interactive Weekly data

MDG LIHRY AEM BGO IAG EGO RGLD GOLD CDE GRS
Interactive Daily data
Interactive Weekly data

CBJ SSRI SIL NG KRY UXG GRZ TSE_HRG TSE_GUY TSE_AGI
Interactive Daily data
Interactive Weekly data

NXG GSS MNG DROOY MFN RNO RANGY MRB CLG
Interactive Daily data
Interactive Weekly data

Here are the key Silver miners and the SLV ETF:

SLV SIL CDE HL PAAS SSRI SLW MGN

Interactive Daily data
Interactive Weekly data

Here are the Weekly and Daily Data charts of the indexes:

Weekly U.S. Goldminers Index:

Interactive Chart of Weekly U.S. Goldminers Index:

Weekly U.S. Goldminers Index - Weekly Chart

Interactive Chart of Daily U.S. Goldminers Index:

Daily U.S. Goldminers Index - Daily Chart

The U.S. goldminer share trust ETF trades under the ticker symbol GDX.

Here are the U.S. Goldminer ETF (GDX) index Weekly and Daily data charts:

GDX Weekly data:

GDX Weekly Data Chart

GDX Daily data:

GDX Daily Data Chart

The Toronto Exchange-listed goldminer iUnits S&P/TSX Capped Gold Index ETF trades under the ticker symbol TSE:XGD. Yes, just like GDX on the AMEX, you can trade XGD on Toronto.

Here are the Weekly and Daily data charts for the TSX Goldshares (XGD) index:

Interactive Chart of XGD Weekly data:

XGD Weekly Data Chart

Interactive Chart of XGD Daily data:

XGD Daily Data Chart

Forex Review

Here is the chart of the week’s trading.

The $USD lost another bundle for the USD Bulls. $USD fell -0.82 (-1.05 pct) to close at 77.77.

This chart looks like a train track into the ocean. Nobody knows how far it can go down.

The following data is a simulation of the M3 as of the past week.

US M3 (estimated) continues to grow at an excessive rate, as it does in Europe. Central bankers are constantly diluting all fiat money at extreme rates. They have no option under the circumstances. The economy is relatively strong, but the credit markets are imploding.

The $USD will continue to fall as long as traders have little confidence in the highest level decision-makers of America, in government, the central bank, commercial banks and business corporations. Until the American consumer has a growing income with a piece of that to spend, there will be disappointments. Less individual taxable income means less personal tax and spending. Less spending means less corp tax and less taxable income. Without taxes, governments must print new money, which depreciates the value of the old money. When that happens, foreigners want to travel to vacation in the US, but they don’t want to hold securities that will repay them in lower valued USD.

Interactive Chart of Weekly U.S. Dollar Index:

Weekly U.S. Dollar Index - Weekly Chart

Interactive Chart of Daily U.S. U.S. Dollar Index:

Daily U.S. Dollar Index - Weekly Chart

Interactive Chart of Weekly Euro Dollar Index, priced in USD:

Weekly Euro Dollar Index - Priced in USD

Interactive Chart of Daily Euro Dollar Index, priced in USD:

Daily Euro Dollar Index - Priced in USD

The Euro ($XEU) gained +1.86 (+1.32 pct W/W) to close at 142.74, a new record.

Four weeks ago, at 136.39, I opined, “I still think we’ll see a 140 handle inside 60 days.” The past 28 days were not bad.

The Euro’s 50d MA is 137.60 and the 200d MA is 134.32.

Weekly British Pound Index:

Weekly British Pound - Weekly Chart

Daily British Pound Index:

Daily British Pound Index - Daily Chart

This week, the Pound gained +2.52 (+1.25 pct) to close at 204.59.

The 50d MA is 202.00 and the 200d MA is 198.61. The recent high was 203.51 (Sept.), and before that 206.40 (July).

Weekly Japanese Yen Index:

The Japanese Yen ($XJY) gained +0.45 (+0.52 pct W/W) to close at 87.16.

The 50d MA is 85.85 and the 200d MA is 83.91.

Weekly Japanese Yen - Weekly Chart

Daily Japanese Yen Index:

Daily Japanese Yen Index - Daily Chart

Weekly Canadian Dollar Index:

Weekly Canadian Dollar - Weekly Chart

Daily Canadian Dollar Index:

Daily Canadian Dollar Index - Daily Chart

This week, the Loonie gained +0.70 (+0.70 pct) to close at 100.74.

The 50d MA is 95.77 and the 200d MA is 90.50.

Parity will take some getting used to and adjustment.

International Equity Markets Review

Here is the latest session data for the exchanges of the Americas.

Here is the latest chart for the Brazilian Bovespa stock exchange in Sao Paulo.

Here is the latest session data for the Toronto Stock Exchange composite index.

Btw, I’ll be attending the Cambridge Gold Show in Toronto Oct 21-22. Apparently, Jock is coming up from St. Louis again. We’ll have to have a hospitality suite in my room at the InterContinental!

International Equity Markets Review

Europe>

Here is the latest session data for the bourses of Europe.

Asia-Pacific

Here is the latest session data for the Asia-Pacific stock exchanges.

Here is the latest chart for the Japanese Nikkei 225 index.

Here is the latest chart for the Singapore index .

Here is the latest chart for the Shanghai Composite index .

Here is the latest chart for the Hong Kong Heng Seng index .

Here is the latest chart for the India BSE 30 index .

Here is the latest chart for the Australian All Ordinaries index .

US Equity Markets Review

A dozen NASDAQ stocks to watch.

Here is the Monthly data chart of the Interactive Chart of Nasdaq Composite, S&P 500, Dow30, and Russell 2000 (small cap) indexes.

Here is the Weekly data chart of the Interactive Chart of Nasdaq Composite, S&P 500, Dow30, and Russell 2000 (small cap) indexes.

Here is the Daily data chart of the Interactive Chart of Nasdaq Composite, S&P 500, Dow30, and Russell 2000 (small cap) indexes.

Table 14: Dow 30 List

Sorted by 1-Week Price Performance
Symbol Close 1Day
Change 1Day
%Change 1W
%Change 2W
%Change 4W
%Change YTD
%Change 3M
%Change 6M
%Change 12M
%Change

GM 36.70 0.24 0.66% 5.04% 7.25% 21.00% 24.62% -1.90% 14.05% 13.69%

AA 39.12 0.12 0.31% 4.60% 10.26% 8.22% 33.38% 0.38% 15.06% 40.97%

MSFT 29.46 -0.03 -0.10% 2.83% 1.45% 3.55% -1.34% -1.37% 6.28% 7.28%

BA 104.99 -0.47 -0.45% 2.34% 5.68% 8.40% 17.74% 10.92% 15.99% 32.21%

MMM 93.58 0.19 0.20% 2.07% 5.12% 4.72% 19.58% 7.40% 21.26% 25.36%

KO 57.47 0.14 0.24% 1.63% 1.90% 7.62% 18.30% 9.59% 19.68% 28.54%

MO 69.53 0.05 0.07% 1.44% 3.73% 0.40% 7.10% -0.95% 8.90% 19.88%

PG 70.34 0.24 0.34% 1.37% 3.73% 8.20% 8.99% 14.50% 11.17% 12.13%

HON 59.47 0.27 0.46% 1.33% 5.37% 5.65% 31.86% 5.61% 27.26% 44.94%

UTX 80.48 -0.21 -0.26% 1.32% 5.70% 8.99% 28.13% 12.56% 21.74% 27.46%

JNJ 65.70 0.16 0.24% 0.89% 3.96% 6.66% -1.05% 6.92% 9.45% 1.36%

IBM 117.80 0.09 0.08% 0.87% 2.32% 2.11% 21.11% 11.73% 24.35% 43.50%

AIG 67.65 0.18 0.27% 0.62% 4.14% 3.13% -6.24% -4.18% 0.09% 2.05%

GE 41.40 0.01 0.02% 0.36% 2.60% 7.81% 9.03% 8.78% 15.67% 17.15%

CAT 78.43 0.96 1.24% 0.35% 7.20% 5.05% 28.24% -1.36% 17.27% 19.41%

XOM 92.56 -0.41 -0.44% 0.27% 4.39% 8.38% 24.90% 10.88% 22.26% 37.88%

AXP 59.37 -0.20 -0.34% 0.15% 0.73% 2.86% -1.64% -3.51% 5.21% 5.96%

INTC 25.86 0.10 0.39% -0.04% 3.73% 2.29% 27.08% 8.70% 35.68% 26.83%

VZ 44.28 -0.40 -0.90% -0.23% 4.14% 5.60% 17.08% 8.21% 17.48% 20.39%

MRK 51.69 -0.61 -1.17% -0.25% 4.34% 4.09% 17.42% 2.70% 18.42% 21.91%

DD 49.56 -0.44 -0.88% -0.26% 3.16% 2.31% 1.06% -3.17% -0.50% 15.26%

T 42.31 -0.52 -1.21% -0.52% 4.62% 6.41% 21.06% 5.83% 7.28% 29.90%

MCD 54.47 -0.09 -0.16% -0.60% -1.77% 11.55% 24.16% 6.10% 20.94% 36.89%

DIS 34.39 0.18 0.53% -0.61% 2.47% 2.75% 0.56% 0.35% -0.78% 10.79%

PFE 24.43 -0.32 -1.29% -0.65% 0.58% -0.49% -7.07% -4.61% -4.16% -14.01%

WMT 43.65 0.04 0.09% -1.31% 0.76% 0.76% -8.20% -9.93% -8.09% -11.82%

HPQ 49.79 -0.48 -0.95% -1.46% 2.91% 2.79% 19.63% 10.18% 23.76% 40.69%

C 46.67 -0.21 -0.45% -1.77% 0.06% 0.95% -15.53% -9.92% -8.60% -6.60%

JPM 45.82 -0.39 -0.84% -2.78% 0.61% 4.21% -4.68% -6.95% -5.66% -2.18%

HD 32.44 -0.32 -0.98% -5.89% -9.08% -12.42% -21.01% -18.41% -13.12% -11.03%

You can do this table yourself by entering the following string into the Summaries window at www.billcara2.com and then clicking on the link for Performance.

AA AIG AXP BA C CAT DD DIS GE GM HD HON HPQ IBM INTC JNJ JPM KO MCD MMM MO MRK MSFT PFE PG T UTX VZ WMT XOM

Here are the links to interactive Dow charts from Billcara2.com that I broke into groups of ten, which you can add technical indicators for as well. (list one) (list two) (list three)

Value Line Report(s) this past Friday

The Value Line reports last week were for AT&T (T) and Verizon (VZ).

Of the two companies, AT&T seems to be in the lead, with the fewest problems and best operating metrics. Total Return (TR), which represents price appreciation and dividends, is estimated by Value Line as much better for T than VZ.

If AT&T could move its Return on Equity up to the 18-20 pct level, then I would consider including the company in the Cara USA 100. But with long distance revenues plummeting due to free Skype and other cheap alternative carriers, I would have a tough time with that. The stock is one for traders whose primary objective is income. With high and growing dividends, where the dividend yield and price appreciation potential is pushed up on every major pull-back in its share price, T would be attractive to many of you. On extreme pull-backs, I would write put options to increase my income.

T is a stock where I believe you could get annual Total Returns of 15-18 pct with your eyes (mostly) closed. Not quite Buffett numbers, but close.

(T: Value Line Report Sep. 28: next one is due Dec. 28)

I have no understanding how Value Line can lower the T’s Technical rating on Friday from a highest rated “1” to a “2”, and then conclude: “These shares are timely. We like this high-quality stock for the long haul, too, and believe that it offers above-average total return potential to 2010-2012. Justin Hellman Sept. 28, 2007.”

(VZ: Value Line Report Sep. 28: next one is due Dec. 28)

I also have no understanding how Value Line can raise the VZ Technical rating a week ago from “3” to “2” and the Safety rating on Friday from a “2” to a highest rated “1”, and then conclude: “Investors need not rush in. This neutrally ranked issue’s 3- to 5-year appreciation potential is now well below that of the average stock under our review. Kenneth A. Nugent Sept. 28, 2007.”

Maybe the name should be Value & Line, or Hellman & Nugent, like in Martin & Lewis, Abbott & Costello or Greenspan & Poole?

Actually, I have a high regard for the Value Line service – most of the time. I continue to urge traders to print out these free Dow 30 reports every week and store them in a binder, with your notes. List all your portfolio stocks and your watchlist stocks that trade in similar patterns (due to similar market reactions to interest rates, economic factors, commodity prices and forex rates). Then when you think there may be a primary or intermediate trend reversal for any of these groups of stocks, go to your public library or to your personally subscribed Value Line, and read the latest data and analysis. This homework helps keep you focused.

As for Verizon, I have always thought the hype from the company surpasses the reality. Even the name seems to be in flight whereas with AT&T (American Telephone & Telegraph), how dull can the picture be. I prefer to think of it as Monotonous Money Machine, which puts a different light on things.

Also, the AT&T company reached its low point in 2004 as then-CEO Michael Armstrong made himself pretty for the TV song-and-dance he was putting on – too many times. I commented at the time – “What’s this man actually accomplished?” – and after he departed, the company’s fortunes started improving.

I wonder how many millions the man took home in unearned compensation? Yes, from company to company, you can spot the good CEO’s from the not-so-good.

My rule is, the bigger the corporation, the less I want to see the CEO on TV. Even if they’re out on a golf course or on a cruiseship in the Mediterranean, I’d like to think that out of sight means hard at work in the office. It’s just this thing I have when I see Talking Heads being interviewed by people like CNBC’s Joe Kernan, like why is the red light flashing on the end of this person’s nose?... clown alert, clown alert…

Contrast that with the picture of Johnson & Johnson CEO William Weldon or the previous CEO Ralph Larsen, or Boeing’s CEO James McNerney (but not previous CEO Harry Stonecipher), In Canada, there is Donald Lindsay of Teck-Cominco (TCK) and Dominic D'Alessandro of Manulife Financial (MFC), who I think are good ones.