« Bill Cara's Community Chat, Tues., July 8, 2008, 7:59am ET | Main | Bill Cara's Community Chat, Wed., July 9, 2008, 8:24am ET »

July 9, 2008

Daily Report for Wed, Jul 09, 2008

Markets Re-cap

Short covering in the Financial sector following speeches by Fed chairman Bernanke and JP Morgan CEO Dimon led the market to a rally yesterday. So far today, the banks are continuing to rally in Europe, but higher oil prices are leaving traders unsure, so the equity futures are flat.

Share prices had been in negative territory yesterday until some mid-day speeches and TV appearances by key financial people led to a mini-rally in New York. By the close, the DJIA gained +152.3 +1.36% to 11384.2, the S&P 500 gained +21.4 +1.71% to 1273.7, and the NASDAQ Composite gained +51.1 +2.28% to 2294.4. The Toronto Composite gained +0.71%, but the Toronto Venture lost -78.7 -3.17% to 2399.7.

In NY, the Financials (XLF +6.5%) followed by Health (XLV) and Consumer Discretionary (XLY), both up +2.6%, were the winners. The loser again was Energy (XLE -1.7%) as Crude Oil ($WTIC) dropped -$5.33/barrel to 136.04. $GOLD futures dropped -$5.50/oz to 923.30.

The leading industry groups were Airlines ($XAL +11.2%), Banks ($BKS +7.6%), Broker-Dealers ($XBD +5.4%), and REIT’s ($DJR +6.8%). Goldminers ($XAU -1.7%) and Oil services ($OSX -1.5%) were the losers.

For the extreme Cara 100 stocks, the winners were ERJ (+11.0%) and BC (+8.2%). The losers were NUE (-4.4%), TCK (-4.3%) and TS (-4.2%).

The 30-year US Bond ($USB) gained +0.47% to 116.84. The yields on the 30-year, 10-year, and 5-year Treasury issues were down a bit and the T-Bill yield gained as traders moved out of short-term debt issues to take on a bit more risk.

The US Dollar index ($USD) gained +0.37% to close at 73.00. The Euro lost -0.40% to 1.5666, Yen -0.36% to 93.01, Pound -0.36% to 1.9694, and the Cdn Loonie -0.19% to 0.9807.

Earlier today, the Asia-Pacific equity markets all rallied. The Australia All-Ords gained +1.33% to 5089.4; the Shanghai Composite gained +3.75% to 2920.55; the Hang Seng of HK gained +2.76% to 21805.8; the Indian Sensex 30 gained +4.60% to 13964.3; and the Nikkei 225 was up just +0.15% to 13052.1.

European stocks this morning at about 8:05am ET. were stronger. The FTSE 100 is up +1.23% to 5507; the French CAC up +1.39% to 4336; and the German DAX +1.18% to 6379.

Crude Oil futures are up +1.91/bbl to 137.95, which is making equity traders nervous. The $USD is at 73.17 and the Euro at 1.5644, largely flat.

Spot prices at 7:47am ET for gold, palladium, platinum are down a bit, and silver up marginally, to: 917.35, 438, 1955, and 17.77, respectively.

The DJIA futures are at 11395, up +20 in the past few minutes, but traders are cautious to start the day.


Comments & Outlook

Yesterday, I started the Daily Report with this statement: “Any attempt to rally this market is hit with words of caution regarding the ill health of the Financials and the inflationary pressures caused by the energy markets.” Then I added in the Comments section: “Share prices in the broad market can be saved from massive destruction if the commodity producers (energy and basic materials) (ie, the Yin) are sacrificed for the benefit of the Industrials, Consumers (cyclicals, staples and health), Financials, Tech, Telecom and Utilities (ie the Yang). So, while we may be in what is called a secular Bull market for commodities, there will be phases in the market where prices of commodities and the share prices of commodity producers are hammered.”

With plenty of rest and no alcohol the previous evening, I can focus my mind clearly on the market as soon as I wake. Apparently, yesterday was one of those days as prices moved pretty much in line with my thinking.

Some of you agree and some disagree with my opinion that “the new reality today is that Crude Oil at about $90-$100 and Gold at $820 is required to stave a total collapse of securities prices across the board. If that’s what the authorities want, ultimately that’s what they will get. The only thing to be determined is the interim volatility, which is the extent of the fight to be put up by vested interests among the commodity producers.”

Yesterday’s action notwithstanding, there is another deep concern shared by many traders that the Financials can and will get the occasional boost from the Fed, but ultimately will have to write off so much worthless investment and replace it with so much new capital that their share prices will continue to fall, and many banks will in fact fail.

What I recommend is that today each of you set up a sample portfolio at Google Finance for every bank and broker with a market cap of say $5 billion or more. To make it easy, here’s a list:
AIB BAC BBD BBV BCH BCS BK BMO BNS C CM CS DB GS HBC HDB IBN ITU JPM KB KEY LEH LYG MER MS MTU NBG NMR PNC RY SAN SCHW STD STI TD UBB UBS WB WBK WFC

Then watch for the earnings reports of these banks, comparing the results (and expected increase in write-downs) to their stock action in the market. Two things could happen to tell you this Bear market is going to end soon: (i) the write-downs are minimal, and (ii) share prices rally—not for one or two banks, but across the board--for several days after the corporate results for the biggest banks are released.

I'm not betting on that to happen. I think the shorts will return to the Financials pretty soon. Yesterday they were scared a bit that Professor Bernanke was up to his old tricks. A little short-covering, that's all.


Links & Charts


International Economics Review

US Economic Calendar.



Knobias Cara100 Tables

 Portfolio GAINERS
SYMB LAST CHG %C VOL
ERJ 27.810 +2.750 +11 2.4M
BC 10.940 +0.830 +8.2 2.5M
IBKR 31.910 +2.180 +7.3 771.4K
LEH 22.270 +1.430 +6.9 53.4M
UBS 20.150 +1.250 +6.6 7.7M
CCL 34.260 +1.910 +5.9 9.3M
RIMM 122.040 +6.380 +5.5 23.8M
BMY 21.650 +1.050 +5.1 19.6M
QCOM 47.550 +2.190 +4.8 28.5M
CHRW 55.700 +2.440 +4.6 2.4M
HDB 74.550 +3.250 +4.6 843.2K
MICC 99.170 +4.200 +4.4 745.9K
ERTS 46.320 +1.940 +4.4 4.6M
MFC 36.240 +1.470 +4.2 2.6M
GSK 47.760 +1.930 +4.2 3.3M
IBN 28.980 +1.130 +4.1 5.8M
BDK 58.250 +2.240 +4 1.1M
WMT 59.110 +2.200 +3.9 32.5M
WFMI 23.260 +0.830 +3.7 4.6M
PAYX 32.130 +1.110 +3.6 7.2M
GRMN 44.100 +1.510 +3.5 3M
GE 28.060 +0.960 +3.5 87.9M
WHR 64.590 +2.120 +3.4 1.1M
NKE 58.320 +1.860 +3.3 4.8M
TGT 48.670 +1.500 +3.2 10.9M

 Portfolio LOSERS
SYMB LAST CHG %C VOL
NUE 63.160 -2.910 -4.4 10.5M
TCK 40.830 -1.850 -4.3 2.2M
TS 65.470 -2.850 -4.2 3.3M
KB 55.160 -1.930 -3.4 1.3M
PBR 62.310 -2.180 -3.4 20.6M
ECA 82.110 -2.160 -2.6 5.4M
IMO 50.220 -1.240 -2.4 724.7K
STO 34.340 -0.780 -2.2 1.8M
SLW 13.540 -0.250 -1.8 3.1M
DELL 22.630 -0.340 -1.5 32M
BHP 75.300 -1.100 -1.4 7M
SU 56.080 -0.790 -1.4 6.9M
XOM 85.940 -1.010 -1.2 35M
GG 43.860 -0.510 -1.1 7.4M
RIO 31.920 -0.350 -1.1 32.9M
CVX 95.790 -1.030 -1.1 18.8M
GGB 21.040 -0.220 -1 8.2M
EXC 89.040 -0.870 -1 4.7M
ATVI 31.720 -0.290 -0.9 7.6M
CHA 52.410 -0.370 -0.7 590K
TGP 24.160 -0.170 -0.7 194K
GFI 11.880 -0.070 -0.6 3.5M
ABX 44.440 -0.250 -0.6 8.7M
DIS 29.950 -0.130 -0.4 25.8M
TM 92.840 -0.330 -0.4 525.9K

 Portfolio 52-Wk HIGHS
SYMB DAY HIGH LAST CHG %CHG VOL
NONE FOUND.

 Portfolio 52-Wk LOWS
SYMB DAY LOW LAST CHG %CHG VOL
SBUX 14.650 15.340 +0.390 +2.61 20.37M

 Portfolio VOLUME
SYMB LAST %C VOL %ADSV
GOL 8.860 +2.8 3.1M +167
TCK 40.830 -4.3 2.2M +120
KB 55.160 -3.4 1.3M +107
MFC 36.240 +4.2 2.6M +106
GSK 47.760 +4.2 3.3M +102
CHA 52.410 -0.7 590K +99
IMO 50.220 -2.4 724.7K +87
PDA 47.390 +0.5 425.3K +81
DIS 29.950 -0.4 25.8M +78
HBC 75.960 +0.9 3.9M +73
PAYX 32.130 +3.6 7.2M +71
ATVI 31.720 -0.9 7.6M +63
CEO 169.150 +1.2 828.2K +62
ECA 82.110 -2.6 5.4M +61
WMT 59.110 +3.9 32.5M +58
SBUX 15.340 +2.6 20.4M +56
BHP 75.300 -1.4 7M +54
DNA 77.910 +2.6 4.8M +53
CCL 34.260 +5.9 9.3M +52
ERJ 27.810 +11 2.4M +49
STO 34.340 -2.2 1.8M +47
CVX 95.790 -1.1 18.8M +46
EXC 89.040 -1 4.7M +45
BBD 20.110 +1.5 14.5M +38
NUE 63.160 -4.4 10.5M +38

 Analysts UPGRADES
SYMB ANALYST OLD   NEW BEFORE   AFTER
YHOO Gabelli --- --- Sell Hold
• PREVIOUS SESSION
SU JP Morgan --- --- Neutral Overweight
SU Friedman 53.00 85.00 Mkt Perform Outperform

 Analysts DOWNGRADES
SYMB ANALYST OLD   NEW BEFORE   AFTER
NONE FOUND.
• PREVIOUS SESSION
DIS Lehman 40.00 29.00 Equal-weight Underweight


Cara 100 Daily RSI-7 Charts


At least one RSI value >70:
TickerLastRSI-7MRSI-7WRSI-7DZone
WMT59.1179.8564.8968.96
TT46.4976.6565.6256.92
TS65.4776.1158.9439.53Sell alert (trig. 4 days ago [on 2008-07-02 at $68.92, -5.01% chg], after a 5 day DZ)
EXC89.0474.1261.6244.94
PBR62.3173.9143.2025.69
ATVI31.7272.6547.9433.11
COST74.6671.8368.7074.26
QCOM47.5570.6958.4959.34
GSK47.7653.3571.7276.63
YHOO24.6441.6547.7773.10
BMY21.6537.6255.8976.72

At least one RSI value <30:
TickerLastRSI-7MRSI-7WRSI-7DZone
ERJ27.8116.2220.6753.01Buy alert (trig. 1 days ago [on 2008-07-08 at $27.81, +0.00% chg], after a 24 day AZ)
GOL8.8617.6014.4616.12Accumulation Zone (for 8 days)
BC10.9417.7622.3345.20Buy alert (trig. 1 days ago [on 2008-07-08 at $10.94, +0.00% chg], after a 6 day AZ)
UBS20.1519.3920.2740.72Buy alert (trig. 1 days ago [on 2008-07-08 at $20.15, +0.00% chg], after a 1 day AZ)
WFMI23.2623.1720.6233.27Buy alert (trig. 1 days ago [on 2008-07-08 at $23.26, +0.00% chg], after a 7 day AZ)
SBUX15.3423.7334.2033.14Buy alert (trig. 1 days ago [on 2008-07-08 at $15.34, +0.00% chg], after a 1 day AZ)
WAG31.8924.8526.1326.28Accumulation Zone (for 5 days)
TGP24.1625.5218.0010.51Accumulation Zone (for 4 days)
DB86.3025.5316.9640.17Buy alert (trig. 1 days ago [on 2008-07-08 at $86.30, +0.00% chg], after a 1 day AZ)
SNDK17.8326.1221.9525.55Accumulation Zone (for 12 days)
CCL34.2627.1936.0155.13Buy alert (trig. 2 days ago [on 2008-07-07 at $32.35, +5.90% chg], after a 3 day AZ)
BDK58.2527.4528.1152.97Buy alert (trig. 3 days ago [on 2008-07-03 at $56.53, +3.04% chg], after a 2 day AZ)
AET37.5628.9220.4428.30Accumulation Zone (for 3 days)
BA65.9229.1522.9333.63Buy alert (trig. 1 days ago [on 2008-07-08 at $65.92, +0.00% chg], after a 5 day AZ)
JCP37.8329.5342.5160.54
TM92.8429.8028.5232.40
KB55.1629.9230.5320.67
DEO70.8130.6817.0636.12Buy alert (trig. 1 days ago [on 2008-07-08 at $70.81, +0.00% chg], after a 1 day AZ)
IBN28.9831.8724.7938.85Buy alert (trig. 1 days ago [on 2008-07-08 at $28.98, +0.00% chg], after a 1 day AZ)
UTX61.7732.4724.5038.55Buy alert (trig. 3 days ago [on 2008-07-03 at $61.05, +1.18% chg], after a 1 day AZ)
ABV59.1933.4625.9717.40
HDB74.5535.4925.6947.78
DOW34.9435.8925.0140.14Buy alert (trig. 2 days ago [on 2008-07-07 at $34.21, +2.13% chg], after a 1 day AZ)
CHA52.4136.5818.8131.25
KO51.4737.0819.2832.89
DIS29.9537.2228.6118.58
WBK95.4539.3428.6145.84
HBC75.9640.4728.1534.70
VCP26.0444.2427.0320.79
CTSH31.3544.8843.9328.08
NKE58.3245.1628.6932.60
VIP27.7045.6629.1739.24
CHL67.3446.4728.1350.03
IMO49.9547.8528.0413.05
TCK40.8348.2033.4714.23
NUE63.1649.2330.8228.29
PDA47.3951.6734.9415.46
RIO31.9251.8732.0523.43
BHP75.3056.7935.9225.79
STO34.3458.7542.2623.81
ECA82.1163.0639.9622.48
SYT58.1864.3339.3827.46
GGB21.0465.2842.8724.20
PBR62.3173.9143.2025.69


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
AXP 41.55 1.96 4.95% 10.30% 1.64% -5.80% -18.59% -10.59% -13.35% -32.45%
WMT 59.11 2.20 3.87% 5.18% 4.36% -0.77% 26.03% 8.56% 28.58% 22.15%
GE 28.06 0.96 3.54% 5.13% 2.41% -6.65% -23.67% -24.06% -20.73% -27.08%
PG 63.66 0.75 1.19% 4.69% 1.16% -3.65% -11.96% -9.89% -12.41% 3.55%
IBM 123.88 2.38 1.96% 4.51% 0.34% -1.57% 18.33% 6.55% 26.94% 13.62%
JPM 35.77 1.73 5.08% 4.26% -2.98% -4.64% -15.18% -20.26% -9.90% -26.96%
PFE 18.19 0.80 4.60% 4.12% 4.66% 0.94% -20.60% -13.38% -22.50% -29.82%
MCD 58.52 1.16 2.02% 4.09% 2.65% -1.33% 0.72% 4.74% 2.52% 13.79%
C 17.39 0.99 6.04% 3.76% -6.25% -11.28% -39.87% -26.81% -35.92% -66.36%
AIG 27.40 1.46 5.63% 3.55% -9.57% -18.18% -51.33% -41.39% -50.68% -60.90%
JNJ 66.21 0.96 1.47% 2.91% 2.99% 0.88% 0.46% -0.17% -1.09% 6.57%
MMM 71.03 1.18 1.69% 2.07% -2.65% -6.32% -14.12% -11.08% -11.44% -19.38%
BA 65.92 1.63 2.54% 0.30% -12.79% -10.86% -23.90% -12.13% -17.51% -33.33%
UTX 61.77 1.19 1.96% 0.11% -10.24% -8.56% -17.87% -13.97% -13.96% -14.92%
VZ 35.36 -0.07 -0.20% -0.11% -1.53% -6.80% -18.17% -3.78% -15.79% -14.90%
KO 51.47 0.18 0.35% -0.98% -3.36% -7.86% -15.75% -14.94% -19.03% -2.15%
BAC 23.54 2.01 9.34% -1.38% -9.04% -20.50% -41.96% -38.67% -38.71% -52.11%
HD 23.04 0.72 3.23% -1.62% -8.06% -13.19% -11.76% -18.24% -6.87% -42.83%
HPQ 43.45 -0.55 -1.25% -1.72% -4.53% -8.78% -12.77% -5.69% 0.60% -5.50%
MRK 36.97 0.37 1.01% -1.91% 3.18% -0.05% -35.56% -9.61% -38.03% -25.25%
T 32.96 0.28 0.86% -2.17% -4.13% -12.25% -19.61% -15.05% -15.83% -18.94%
DD 41.89 0.37 0.89% -2.33% -7.87% -9.35% -4.23% -15.31% -2.01% -19.40%
XOM 85.94 -1.01 -1.16% -2.48% -2.01% -3.51% -8.10% -4.10% -4.56% -0.60%
INTC 20.92 0.21 1.01% -2.61% -6.44% -8.08% -17.48% -0.76% -6.02% -15.24%
CVX 95.79 -1.03 -1.06% -3.37% -3.30% -5.35% 2.49% 7.29% 5.32% 9.25%
DIS 29.95 -0.13 -0.43% -4.01% -7.53% -9.73% -5.94% -3.60% -1.93% -13.16%
CAT 69.51 -1.30 -1.84% -5.84% -13.11% -13.98% -1.59% -10.41% 3.51% -11.80%