Overnight, the Asia-Pacific equity markets sold off for the most part as expected, but the moves were not serious. The Japanese Nikkei 225 dropped -1.30 pct, Hong Kong -1.24 pct, Singapore -2.46 pct, and Australia -2.27 pct, while Shanghai was up +0.59 pct and India +0.61 pct. At this point (8:01am ET), the bourses of Europe are up about +0.4 pct.

So the big sell-off follow-through from Friday in the US did not happen.

Crude Oil e-miNY Feb-08 contracts are running at 97.475, which is close to being unchanged from Friday afternoon.

The spot Gold price is up from Friday, and since midnight ET up +6.46 (+0.75 pct) to 862.26. Spot Silver is up +0.13 since midnight to 15.31, caught within an interesting flag pattern since early Thursday.

The $USD is a little firmer this morning. The Euro e-miNY Mar-08 contracts are running at 1.4711, down -0.45 pct. The DJIA e-miNY Mar-08 contracts are presently up +41, and Nasdaq up +4.00, indicating a firm open.

Interest rate futures are a bit stronger as US Treasuries are soft.

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Links & Charts

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International Economics Review

US Economic Calendar.

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International Equity Markets Review

Europe

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

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Here is the latest session data for the London stock exchange FTSE.

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Here is the latest session data for the German DAX.

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Here is the latest session data for the French CAC 40.

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Here is the latest session data for the Milan Italy stock exchange MIBTEL.

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Here is the latest session data for the Swiss market index.

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Asia-Pacific

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

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

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Here is the latest chart for the Singapore index .

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Here is the latest chart for the Shanghai Composite index .

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

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

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

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US Equity Markets Review

DJIA (interactive) chart

NASDAQ Composite (interactive) chart

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Oil Review

Here is the e-miNY Jan-08 Crude Oil chart.

Interactive Chart of Daily Crude Oil:

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Gold & Precious Metals Review

Spot gold chart for the week

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Spot silver chart for the week

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Forex Review

Here is the chart of the week's trading in the $USD.

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Comments & Outlook

Imagine my shock this morning to see the Bloomberg headlines that the brainiac strategists at Goldman Sachs and Citigroup have published their 2008 forecast for US equity market prices, which they say will lift +14 pct by December 31. The average target from HB&B is up +11 pct.

With dividends, the anticipated Total Return is very high. I do not believe it.

In a similar vein, in the 4Q07, I stated that earnings projections of +20 pct in the quarter for high tech companies was dubious at best. I did not believe it then either.

The point I’d like to make is where is the covenant in publishing these projections and forecasts? Obviously reputation doesn’t matter to HB&B any more.

When Wall Street gets into a storm, you can count on them to try to pull on the same oars to keep the ship afloat. If they would only call themselves salespeople, I’d say have at it. But these people hold themselves out as investment advisors. With the SIV/CDO crisis of the moment, some of them don’t even truly know if they are solvent, so why should we listen to them?

This is not a small issue.

When independent analyst Marc Faber calls for buying cotton and gold commodities and selling all securities, as he did today, he will be referred to on the Street as a crackpot. In other words, HB&B says either get with the program or we will destroy your credibility.

I’d like to point out that for all the HB&B published ratings of Dow 30 stocks to start the year 2000 – immediately preceding one of the worst Bear markets in history – these so-called investment experts and advisors averaged more than 98 pct Strong Buy, Buy and Hold ratings and less than 2 pct Sells. Completely ignored were the mind-blowing, never before seen in history PE’s for stable income earners like General Electric and Procter & Gamble.

After I thought about this Bloomberg headline today, I googled Abby Joseph Cohen to see what the Goldman Sachs' chief US investment strategist had to say in other media recently. Imagine my surprise when I see what was reported on January 2 by CNNMoney.com:

Wall Street's top forecasters have some good news and bad news for 2008. Many think stocks will head higher but that unemployment will rise and the overall economy will slow.

In other words, 2008 is going to look an awful lot like 2007. Despite falling housing prices and the subprime mortgage meltdown igniting fears about a broader economic slowdown, stocks are still on track to finish higher in 2007.

For 2008, experts said investors need to be prepared for more woes in the slumping housing market and a slight rise in unemployment.

"2008 will be a sluggish year," Abby Joseph Cohen, Goldman Sachs' chief U.S. investment strategist, told CNNMoney.com. She said many investors are concerned about what could be weak earnings growth in 2008.

"Portfolio managers sense that 2008 will be a very difficult year for corporate profits," she said.

But Cohen believes that stocks could finish 2008 in the plus column as investors anticipate better news in the latter part of the year.

"We believe that the worst time is right now. The worst numbers will be at the end of 2007 and in the first half 2008. We expect an improvement in the second half," she said.

Now how could anybody glean a 15 or 16 pct total Annual Return out of what Ms. Cohen had to say?

At the end of the day, the dynamics of Wall Street takes on a life of its own, depending on what the spin doctors want you to believe. The only certainty is that you will be spun.

After all, Wall Street is the only game that plays people.

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