The DJIA (-108.0 -0.85 pct to 12635.16), S&P 500 (-14.60 -1.05 pct to 1380.82) and Nasdaq Composite (-30.51 -1.26 pct to 2382.85) sagged as the Financials (XLF -2.90 pct) and Technology (-2.07 pct) led the way down. Only the Utilities (XLU +1.44 pct) were looking good on an otherwise blue Monday.

The Banks ($BKX -4.11 pct), Broker-Dealers ($XBD -2.30 pct) and Retailers ($RLX -3.17 pct), which had been last week’s big winners, were all leaders on the downside.

The consumer stocks, CCL (-6.1 pct), TGT (-5.3 pct), BBBY (-5.1 pct), WHR (-4.8 pct), ERTS (-4.4 pct) and JCP (-3.9 pct), all gave back some or all of the previous week’s gains. So too were the bankers hit, eg, UBS -4.6 pct, LEH -3.3 pct, and the India-duo of HDB and IBN at -3.0 pct and -2.9 pct respectively.

Most of the gainers were in the coal and oils, such as TCK +5.9 pct, the Chinese oils PTR and CEO (+3.8 pct and +3.1 pct respectively) and Canadian Oils IMO and SU (+2.1 pct and +1.7 pct respectively).

On the corporate deals front, it looks like the Microsoft (MSFT) bid for Yahoo (YHOO) might run into resistance. Google (GOOG) CEO Eric Schmidt offered Yahoo CEO Jerry Yang financial muscle to fight off Gates, Ballmer & Co.

On the earnings front, Archer Daniels Midland's (ADM) fiscal Q2 lifted +7 pct to $473 million ($0.73/share) vs $441 million ($0.67/sh) a year earlier as revenue jumped +50 pct to $16.5 billion. This is a clear sign that food inflation will be a problem. The GSCI Agriculture Index gained +2.31 pct on the day.

Early today, Toyota (TM) is guiding higher by about +7.5 pct for its recent profit growth, and BP reported a recent surge of +53 pct in earnings, although the net earnings for the year were still down.

The economic data turned somewhat positive as December factory orders grew +2.3 pct and non-defense capital goods (excluding aircraft orders) gained +4.4 pct. That didn’t help the $USD, which dropped -0.18 pct to 75.35.

Crude Oil ($WTIC) jumped +1.0 pct to $90.02/bbl, on the $USD weakness and also apparently due to increased geo-political tensions in Iraq and Nigeria.

$GOLD lost -4.10 (-0.45 pct) to 909.40.

But early today the picture remains blue as most of Asia-Pacific closed down: Australia -1.2 pct), China -1.6 pct, Hong Kong -0.9 pct, and Japan -0.8 pct.

In Europe at 7:00am ET, the FTSE, CAC and DAX were down -0.6 pct, -0.8 pct and -0.5 pct respectively.

March Crude Oil is down about -0.8 pct to 89.25, while the March USD is stronger as the March Euro is down -1.0 pct to 1.4665. And, April Gold -13.30 to 896.00 and March Silver -0.22 to 16.56 are down sharply.

In the Spot market at 7:00am ET, Gold, Silver, Platinum and Palladium are down since midnight by -9.67, -0.15, -12 and -8. Silver, plat and pall are a tad stronger from their 6:00am levels though.

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Comments & Outlook

My sixth sense tells me that there will be more talk this year about wage and price inflation than economic woes. Higher inflation means higher interest rates, which will bring on additional problems in the credit market, which will hurt the banks and brokers.

Overnight, the interest rate in Australia was bumped on account of these concerns that inflation is creeping to a +4 pct level. And in New Zealand, the wage inflation data yesterday was negative. I hear the same is true in countries like Germany.

So, there is only so much that central bankers can do to stimulate economies that are squeezed by inflation and credit market issues.

I think that there simply has to be more cleaning up of problems at HB&B, and traders have to let this credit contraction cycle play out. So, my recommendation is to relax, sit back and let prices come to you. Avoid bonds, especially at the long end, and switch instead to well-protected income oriented trusts.

I still believe the primary equity market cycle will bottom at 10000 for the DJIA and 2000 for the Nasdaq Composite, to use round numbers. That simply says this Bear market is not yet half played out.

I do think most or all the damage will be done in the 1H08 and that the Techs will be leaders in the 2H of the year.

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Links & Charts

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International Economics Review

US Economic Calendar.

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Knobias Cara100 Tables

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Cara 100 Daily RSI-7 Charts

At least one RSI value >70:

Ticker	Last	RSI-7M	RSI-7W	RSI-7D	Zone
PBR	113.06	83.20	62.14	68.91
IBKR	35.47	82.47	74.94	73.47	Distribution Zone (for 1 days)
COST	67.79	82.46	53.87	58.44
ABX	50.90	82.34	67.26	51.85	Sell alert (trig. 2 days ago [on 2008-01-31 at $51.44, -1.05% chg], after a 3 day DZ)
NOK	37.62	78.15	55.53	68.84
GG	36.75	72.40	58.63	47.22
KO	59.26	71.69	42.80	44.28
TT	44.79	71.29	66.94	59.81
VCP	30.25	71.28	55.49	71.89
NKE	62.51	68.87	54.42	73.56
WMT	51.18	67.13	72.05	74.34
CHRW	56.27	64.67	66.26	78.76
ECA	67.78	64.17	55.65	70.96
BHP	73.72	63.81	55.90	78.14
NUE	59.58	55.93	58.15	73.81
QCOM	42.20	55.05	63.05	70.21
RY	51.75	54.55	56.29	76.10
YHOO	28.38	52.97	63.82	77.80
LEH	66.00	50.39	63.10	74.54
AMAT	18.88	48.56	59.35	74.67
TGT	57.05	46.62	58.12	73.73
WHR	85.72	46.02	59.22	76.43
SWK	51.32	45.53	59.01	80.87
DOW	39.89	42.20	53.12	78.26
BBBY	32.38	41.22	62.83	72.60
WFMI	40.76	40.04	51.08	73.15
TM	109.80	39.47	55.28	78.22	Buy alert (trig. 8 days ago [on 2008-01-23 at $99.25, +10.63% chg], after a 1 day AZ)
INFY	43.50	39.36	51.16	77.45
JCP	48.50	32.98	57.29	78.96
BC	19.28	27.70	55.52	87.51
KSS	45.93	25.22	47.98	71.12

At least one RSI value <30:

Ticker	Last	RSI-7M	RSI-7W	RSI-7D	Zone
SBUX	19.22	17.59	30.27	45.77
UBS	42.04	24.37	27.21	45.96
SNDK	27.55	24.37	23.77	55.51	Buy alert (trig. 2 days ago [on 2008-01-31 at $25.45, +8.25% chg], after a 2 day AZ)
KSS	45.93	25.22	47.98	71.12
BC	19.28	27.70	55.52	87.51
WAG	36.32	27.91	47.67	69.82
DELL	20.35	28.84	23.01	42.92	Buy alert (trig. 7 days ago [on 2008-01-24 at $21.09, -3.51% chg], after a 2 day AZ)
KB	65.87	29.11	35.86	47.84
GSK	47.01	31.96	33.45	29.27
GFI	14.08	33.94	34.10	24.27
ADBE	34.48	34.95	20.17	29.69
CCJ	33.34	35.70	31.37	23.17
GOOG	515.90	43.51	25.31	23.00
PG	66.05	50.49	29.17	41.41

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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

Table: 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
AA	34.08	-0.20	-0.58%	8.29%	17.11%	-2.27%	-5.67%	-11.62%	-5.80%	5.06%
BA	82.90	0.14	0.17%	6.83%	5.74%	-3.40%	-4.29%	-15.20%	-20.47%	-7.94%
C	29.22	-0.47	-1.58%	5.68%	19.51%	0.69%	1.04%	-22.55%	-36.09%	-46.54%
MCD	53.88	-0.34	-0.63%	5.50%	2.82%	-5.56%	-7.26%	-8.71%	11.05%	20.97%
DIS	30.90	0.24	0.78%	5.21%	8.38%	-0.74%	-2.95%	-8.90%	-8.85%	-12.17%
T	38.16	-0.12	-0.31%	4.84%	5.68%	-6.68%	-6.93%	-5.59%	-3.27%	0.10%
INTC	21.20	-0.57	-2.62%	4.48%	11.58%	-6.48%	-16.37%	-20.90%	-11.33%	-0.14%
MMM	80.57	-0.64	-0.79%	4.04%	7.56%	-1.46%	-2.59%	-5.09%	-7.98%	9.07%
CAT	70.95	-0.81	-1.13%	4.02%	12.96%	3.53%	0.45%	-5.10%	-10.14%	8.74%
GM	27.57	-1.41	-4.87%	3.92%	17.22%	16.58%	12.95%	-25.47%	-13.95%	-16.43%
IBM	107.93	-1.15	-1.05%	2.81%	4.38%	6.72%	3.09%	-5.81%	-3.54%	8.83%
WMT	50.07	-1.11	-2.17%	2.79%	5.23%	9.51%	6.76%	13.31%	10.00%	4.14%
PFE	23.63	0.04	0.17%	2.78%	4.98%	3.50%	3.14%	-0.17%	0.51%	-11.83%
HON	60.48	0.27	0.45%	2.65%	9.37%	3.77%	0.97%	1.90%	3.95%	31.02%
GE	35.37	-0.79	-2.18%	1.87%	3.09%	-1.86%	-3.78%	-12.30%	-7.07%	-2.48%
DD	45.64	-0.31	-0.67%	1.78%	6.89%	5.21%	4.34%	-4.84%	-1.53%	-9.17%
JPM	46.22	-2.03	-4.21%	1.43%	17.31%	12.92%	9.60%	7.11%	5.89%	-9.25%
PG	66.15	0.10	0.15%	1.32%	-1.49%	-8.15%	-8.52%	-4.89%	5.20%	1.24%
VZ	38.61	-0.14	-0.36%	1.31%	-1.23%	-9.37%	-10.65%	-13.00%	-9.68%	1.15%
AIG	55.43	-0.30	-0.54%	1.24%	6.49%	0.24%	-1.55%	-6.24%	-10.07%	-19.75%
HD	29.35	-1.10	-3.61%	0.72%	11.68%	17.59%	12.41%	-3.45%	-18.90%	-28.12%
JNJ	63.47	0.11	0.17%	0.63%	-4.25%	-3.60%	-3.70%	-2.02%	4.82%	-4.67%
HPQ	44.06	-0.36	-0.81%	0.59%	0.71%	-6.00%	-11.54%	-15.92%	-7.07%	4.73%
AXP	47.66	-1.94	-3.91%	0.55%	9.29%	-3.01%	-6.62%	-18.42%	-17.10%	-18.05%
UTX	74.05	-0.07	-0.09%	0.43%	8.82%	-1.29%	-1.54%	-2.11%	0.16%	8.90%
XOM	85.44	-0.51	-0.59%	0.36%	0.42%	-7.21%	-8.63%	-2.83%	4.09%	13.11%
MO	75.07	-0.37	-0.49%	0.08%	-0.46%	0.23%	0.19%	4.10%	12.72%	15.56%
KO	58.63	-0.63	-1.06%	-1.31%	-3.47%	-5.21%	-4.03%	-3.11%	10.04%	21.54%
MRK	47.47	1.49	3.24%	-3.61%	-10.97%	-16.50%	-17.26%	-15.29%	-5.61%	6.13%
MSFT	30.19	-0.26	-0.85%	-7.73%	-8.54%	-12.19%	-14.28%	-18.54%	4.25%	0.00%

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) (