The DJIA (+130.4 +1.01% to 12876.3), S&P 500 (+15.3 +1.09% to 1403.58), NASDAQ Composite (+43 +1.73% to 2488.5) and the Russell 2000 small cap index (+13.5 +1.84% to 732.6) were all very strong.

The leading sectors were Basic Materials (XLB +2.1%) and Consumer Discretionary (XLY +2.1%) whereas the Energy sector (XLE -0.6%) both held the market in check and gave it some fuel.

In the industry groups, the Retailers ($RLX +2.7%) were very strong – 1-800-HELP in the form of “tax” rebates will do that. The REITS ($DJR) and Broker-Dealers ($XBD) each gained +2.5%.

Many of the Retailers had gains above +4%: Pacific Sunwear (PSS +17.3%), AnnTaylor (ANN +16.1%), Hot Topic (HOTT +7.4%), Bebe (BEBE +6.2%), Tween Brands (TWB +6.0%), The Limited (LTD +4.7%), Best Buy (BBY +4.2%) Bed, Bath & Beyond (BBBY +4.1%) and Ethan Allen (ETH +4.0%).

Among the Cara 100 stocks, Canada’s Research In Motion (RIMM +6.9%) and EnCana (ECA +6.7%) were strongest, while VIP (-3.1%) and YHOO (-2.6%) were down on the day.

On the earnings front, Japan's top telecommunications company Nippon Telegraph and Telephone (NTT) reported its FY 2007 group net profit surged +32%. France's #2 bank, Societe Generale SA was a different story. It had a -23% decline in Q1 profits to $1.7 billion. This bank is still blaming a $7.18 billion trading loss to an individual “rogue” trader. (Cara 100) Wal-Mart has just reported a +6.9% profit increase, earning $3.02 billion ($0.76/share vs analyst expectations of $0.75) vs $2.83 billion ($0.68/sh). Overall revenue was $95.30 billion compared to $86.41 billion for the prior year.

On the deals front, (Cara 100) Aussie-based Westpac Banking Corp (WBK) has made a $17.6 billion all-share bid for smaller rival St George Bank in a merger that would create Australia's biggest bank by market value. Also, Hewlett-Packard (HPQ) confirmed it is in talks to buy Electronic Data Systems (EDS).

On the economics front, the Chinese money supply grew at the Y/Y rate of +17% in April. The Greek Import Price Index grew +7.9% Y/Y in March, quicker than the +0.3% growth experienced in the previous year.

The US long bond ($USB was flat at $117.25. There was a pop of +6.1% in the T-Bill yield to 1.750.

Crude Oil ($WTIC) dropped -$1.73/bbl to 124.23. The June futures earlier today were down at 123.60.

$GOLD lost -$0.90/oz to 884.90 and like the other precious metals is marginally softer in the spot market this morning as the $USD has gained some moderate strength. But nothing remarkable.

Asia-Pacific equity markets were mixed overnight. Hong Kong (+1.95% to 25553) and Japan Nikkei (+1.53% to 13953.7) were quite strong, but Australia, Shanghai, and India were down. In trading at mid-session in Europe, the losses at 7:30am ET were minor and also a little better than 90 minutes earlier.

The June Dow 30 futures are down about -40 to 12824.

---

Comments & Outlook

With the continuing need by bankers to recapitalize their balance sheets, and the need for governments around the old world to replace or at least maintain needed infrastructure, the capital markets will be squeezed out unless the major central banks continue to print money.

The current capital flows are supporting high commodity prices, which is a drag on economic growth, everywhere, but particularly in the old world economies like the US.

I suspect this process to continue for at least the next several years, meaning that the average consumer in the US will struggle on, house poor and disappointed to be missing the American dream.

What tends to happen during challenging times like this is that people try to recover the easy way, through lotteries, gambling, stealing, and day-trading. That’s not a desirable or satisfactory retirement plan, but some people will do what they feel they must do.

I’ll leave you with a final thought, which is that most Americans will not admit (i) that as owners of capital they will have to accept lower returns, (ii) they are chattels of the debt system, and (iii) their country has generally disappointed them. I believe there will be an outpouring of emotion come the November elections, where people vote for ‘change’.

Translating that discussion to the capital markets, I see a difficult time in the bond markets for several years, and a flowing of capital from large cap companies into smaller, less seasoned companies with younger and more aggressive management.

Yesterday, the Russell 2000 small cap index (+1.84%) and the relatively smaller company-based, more youthful NASDAQ Composite (+1.73%) were head and shoulders the better performers than the DJIA (+1.01%) and S&P 500 (+1.09%). On the good days in the market, when traders will be reaching to make back some lost ground, perhaps too quickly, I foresee more of the same.

If you are going to try to be a player then during difficult market conditions, don’t ignore the risks that lie just below the surface.

---

Links & Charts

---

International Economics Review

US Economic Calendar.

---

Knobias Cara100 Tables

---

Cara 100 Daily RSI-7 Charts

At least one RSI value >70:

Ticker	Last	RSI-7M	RSI-7W	RSI-7D	Zone
GGB	44.96	88.25	79.82	79.32	Distribution Zone (for 3 days)
SYT	60.90	87.49	60.30	57.78
ECA	91.73	86.33	74.92	80.55	Distribution Zone (for 1 days)
PBR	65.70	82.85	69.07	69.47
ATVI	30.90	81.52	83.26	80.13	Distribution Zone (for 2 days)
RIMM	141.97	81.13	77.88	78.71	Distribution Zone (for 1 days)
RIO	40.58	79.81	70.35	61.76
WMT	58.02	79.80	83.16	64.96
NUE	81.34	77.92	79.04	66.06	Sell alert (trig. 2 days ago [on 2008-05-09 at $78.41, +3.74% chg], after a 1 day DZ)
SU	126.90	75.85	75.39	78.98	Distribution Zone (for 3 days)
TT	46.53	74.21	68.39	60.16
BHP	88.27	73.77	77.02	66.30
CHRW	64.92	72.94	71.29	58.81	Sell alert (trig. 4 days ago [on 2008-05-07 at $63.79, +1.77% chg], after a 4 day DZ)
PDA	58.02	71.87	68.34	65.97	Sell alert (trig. 5 days ago [on 2008-05-06 at $57.80, +0.38% chg], after a 2 day DZ)
ABB	31.44	71.47	77.47	72.70	Distribution Zone (for 1 days)
ABV	76.50	70.63	51.60	52.64
STO	38.48	70.02	85.15	70.51	Distribution Zone (for 1 days)
COST	73.68	69.58	75.01	74.03	Sell alert (trig. 4 days ago [on 2008-05-07 at $72.08, +2.22% chg], after a 5 day DZ)
NTES	24.14	69.09	74.43	76.79
CVX	97.36	68.35	79.81	68.23
LLTC	36.50	66.82	78.54	72.29
TOT	84.30	62.05	72.66	62.79
QCOM	44.63	62.01	72.23	63.05
DIS	34.77	61.95	71.99	76.94
IBKR	32.99	59.40	62.59	73.24
DOW	41.77	57.40	72.26	78.56
HBC	86.68	56.04	71.19	56.24
ERTS	54.27	56.00	66.30	76.96
ADBE	40.44	54.51	70.97	69.27
CCJ	40.01	50.71	61.27	77.09

At least one RSI value <30:

Ticker	Last	RSI-7M	RSI-7W	RSI-7D	Zone
SBUX	16.04	13.66	35.50	39.75
UBS	31.60	27.90	38.20	32.71
BC	16.50	29.13	48.44	52.41
GRMN	43.12	33.27	27.99	46.51	Buy alert (trig. 8 days ago [on 2008-05-01 at $43.12, +0.00% chg], after a 1 day AZ)
PG	65.35	46.70	33.41	26.33
KO	56.40	49.15	29.63	18.83

---

International Equity Markets Review

Europe

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

---

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

---

Here is the latest session data for the German DAX.

---

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

---

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

---

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

---

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 Hang 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

DJIA (interactive) chart

NASDAQ Composite (interactive) chart

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
AA	41.61	2.57	6.58%	12.79%	16.42%	22.63%	15.17%	24.25%	16.00%	9.41%
DIS	34.77	0.47	1.37%	4.45%	7.22%	15.75%	9.20%	8.55%	8.59%	-3.60%
MSFT	29.99	0.60	2.04%	3.13%	3.45%	6.88%	-14.85%	5.82%	-10.16%	-2.91%
IBM	125.24	1.18	0.95%	2.63%	2.92%	6.79%	19.63%	17.56%	23.45%	18.17%
WMT	58.02	0.84	1.47%	1.84%	1.17%	5.20%	23.71%	15.46%	33.93%	21.43%
CVX	97.36	-0.03	-0.03%	1.82%	5.25%	9.03%	4.17%	20.02%	14.18%	21.64%
INTC	23.64	0.27	1.16%	1.68%	4.10%	14.26%	-6.75%	13.11%	-6.52%	6.10%
MRK	39.62	0.63	1.62%	1.64%	-4.39%	-4.30%	-30.94%	-14.85%	-29.24%	-23.81%
CAT	83.82	2.06	2.52%	1.29%	0.95%	10.96%	18.67%	19.74%	20.43%	11.94%
MMM	77.67	1.35	1.77%	0.15%	0.70%	-0.75%	-6.09%	-1.81%	-1.96%	-9.21%
MCD	60.87	1.63	2.75%	0.00%	2.15%	9.60%	4.77%	7.98%	3.98%	20.18%
UTX	74.57	1.44	1.97%	-0.07%	2.09%	6.54%	-0.85%	2.40%	0.87%	9.04%
DD	49.58	1.14	2.35%	-0.24%	0.81%	1.60%	13.35%	5.22%	5.92%	-1.67%
XOM	89.19	0.37	0.42%	-0.36%	-3.53%	-0.57%	-4.62%	5.70%	5.50%	9.80%
AXP	49.95	0.99	2.02%	-0.93%	4.30%	16.92%	-2.14%	10.80%	-10.95%	-20.68%
BA	84.80	0.74	0.88%	-1.30%	-0.21%	9.82%	-2.10%	1.48%	-8.68%	-9.21%
JPM	47.24	0.67	1.44%	-1.58%	-0.21%	13.83%	12.02%	9.07%	11.44%	-9.42%
JNJ	66.71	0.16	0.24%	-1.75%	-0.91%	1.48%	1.21%	5.94%	0.60%	7.13%
T	39.11	0.52	1.35%	-1.86%	2.11%	5.13%	-4.61%	4.27%	1.19%	-1.21%
PG	65.35	0.14	0.21%	-1.95%	-1.30%	-6.80%	-9.63%	-2.70%	-7.66%	6.00%
VZ	38.06	0.15	0.40%	-2.16%	0.29%	7.70%	-11.92%	1.33%	-11.07%	-7.96%
GE	32.40	0.13	0.40%	-2.35%	-2.32%	2.05%	-11.86%	-5.73%	-15.29%	-12.36%
HD	28.64	0.66	2.36%	-2.49%	-3.67%	2.62%	9.69%	0.92%	0.63%	-26.30%
PFE	19.91	0.12	0.61%	-2.97%	-1.58%	-3.16%	-13.09%	-12.21%	-13.51%	-26.37%
HPQ	46.65	-2.48	-5.05%	-3.38%	-1.98%	1.81%	-6.35%	8.79%	-1.88%	3.11%
KO	56.40	0.25	0.45%	-3.39%	-4.37%	-7.54%	-7.68%	-5.87%	-5.78%	7.04%
BAC	37.44	0.79	2.16%	-3.93%	-1.94%	5.23%	-7.69%	-12.56%	-14.87%	-26.52%
GM	20.76	0.47	2.32%	-7.16%	-5.38%	9.26%	-14.95%	-21.95%	-32.58%	-29.53%
C	23.64	0.01	0.04%	-8.19%	-11.82%	5.02%	-18.26%	-9.81%	-29.58%	-55.49%
AIG	38.37	-1.91	-4.74%	-19.03%	-18.43%	-11.37%	-31.85%	-16.84%	-32.42%	-47.13%

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) (