But yesterday, there were plunging share prices all over the world. At the close, the DJIA (-449.36 -4.06% to 10609.66), S&P 500 (-57.21 -4.71% to 1156.39), and NASDAQ Composite (-109.05 -4.94% to 2098.85) all collapsed. So too did the Toronto Composite (-2.86%) to 11877.7; but the Venture Board held the line with a gain of +0.72% to 1469.6.

Earlier in the day the Asia-Pacific and European markets were also hit by selling. All across the world, traders have walked away from financial services companies.

Before relating how bad yesterday was for the Bulls, I will tell you that six leading central banks have agreed to pump more than $180 billion in extra $USD into global money markets that this week had seized up. The Fed announced it was extending currency swap arrangements with other central banks to fund the extra liquidity operations.

At about the same time Britain’s Lloyds Bank (LLOY.L) made a US$21.7 billion deal to acquire the highly stressed HBOS (HBOS.L). Lloyds sealed a 12.2 billion pound) deal to buy HBOS (HBOS.L), the country’s largest mortgage bank.

Immediately, there was a turn in the equity market indexes around the world, and prices started to rally. Some of this is short covering, and some of it will be the use of Other People’s Money by the financial services companies to pump the shares of stocks in their own industry; but much of the volume will be from traders who were cognizant that the equity market had been heavily sold down to value finding levels.

So, today, there will be what may likely be the start of a market rally that lasts for as long as it takes the financial services industry to sort out their issues with write-downs and diminished reserves. As I reported yesterday, I believe the equity market will split the financials from the non-financials, with the non-financials starting a new Bull market now, and the financial stocks rallying along with the rest for a time before falling again to test the sector bottom.

At the end of the day, the financial sector will likely miss the first leg of the new Bull because traders know: (i) the balance sheet liabilities of banks are understated and their assets over-stated, and (ii) the central banks that have been coordinating this emergency lending must recover those funds to then restore the health of their own banks and the confidence of government legislators.

Home-owners are still beleaguered and consumers are still facing hugely inflated prices and have less purchasing means, so the financial services and consumer discretionary-spending companies will lag.

In any case, in equity markets today, there were mostly losses until the central banks announced their relief plan: Australia All-Ords (-2.47% to 4651.9), Shanghai Composite (-1.72% to 1895.8), Hong Kong Hang Seng (-0.03% to 17632.5), India Sensex 30 (+0.40% to 13315.6), and Japan’s Nikkei 225 (-2.22% to 11489.3) were quite soft before the coordinated central bank action was taken.

In Europe, after setting lows (3954 for the CAC, 5818 for the DAX and 4883 for the FTSE), the equity markets stormed back. After the US markets open much stronger this morning, the European markets are expected to sustain their rally.

In the US yesterday, all sectors were crushed. Worst hit were Financials (XLF -9.6%) and Technology (XLK -6.3%). A day ago, after the rally, the XLF had gained +7.5% and I remarked “these reversals may be short-lived”. I have been correctly forecasting this roller coaster for you every day, which itself is stressful.

Among industry groups yesterday, all were hammered into the deep red – except one – the Goldminers: the $XAU index gained +8.6%. The opening paragraph of my commentary yesterday saved so many of you from selling.

The losers in the XLF were the Broker-Dealers ($XBD -10.2%) and Banks ($BKX -7.7%).

Among the Cara 100, there were some big winners on a day when the broad market sank about -5.0%. The leading winners were SNDK (+39.1%), ABX (+13.0%), GG (+11.0%) and SLW.

The leading losers were: IBKR (-15.2%), GS (-13.9%), PTR (-13.4%), and GOL (-13.2%). Goldman Sachs reported a -70% drop in earnings, but traders ignored the report because they do not trust the write-offs, believing instead that GS will be merged with another sad-sack bank in order to hide the losses and try to sustain what has been a pristine reputation in the industry.

All in all, there were nine Cara 100 stocks that dropped over -10% on the day, which shows that the shares of even the best quality companies can plunge at times, making it all the more important to be an active trader when markets are volatile.

Bond Yields dropped as the safe-haven trade was put on again. The 30-year US Treasury Bond ($USB) gained +0.28% to 122.89. Yields on the 30-year, 10-year and 5-year dropped to 4.081, 3.410 and 2.489 per cent respectively. The yield on the 3-month Treasury Bill dropped to almost nil. I think long-term holders of bonds can sell bond positions now and switch to high dividend yielding equities of the highest quality companies. You can look to the Utilities, I think, if you are looking for income.

Gold prices soared in the biggest one-day gain ever, yesterday, with $GOLD lifting +$70.00/oz to 850.50. Crude Oil ($WTIC) gained +5.94/bbl to 96.96. The $USD sank -1.22% to 78.19, while the Euro gained +1.24% to 143.30. The Yen, and Pound gained +1.52% and +1.79% respectively, while the Cdn Loonie lost -0.27% to 93.40.

In the futures market, prices are moving so fast, it would be silly for me to quote them. Suffice to say that Crude Oil is on its way to 100, Gold may hit 900, the DJIA futures are up about +100, and the $USD is down large and the Euro well up during the early morning.

Trading will be very volatile, today and tomorrow, which is called Quadruple Witching Day.

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Comments & Outlook

Yesterday here, I stated: “One of my key indicators for timing the end of the current Bear market will be the Toronto Venture Board index. This index is a sophisticated measure of trader confidence and appetite for risk… So, when you see the reversal in the CDNX market (ie, Toronto Venture Board), I believe that will be a signal that smart money (of which there is plenty around) is returning to capital markets. That will be the time for you to take a reasonable risk to seek the legitimate reward opportunities that equity markets periodically present.”

CDNX rallied yesterday by +0.72% while all the world’s markets were cratering. This morning you can see the rest of the world following the Toronto Venture Board rally.

The big picture here is that central banks have convened with organized support, which will rally stocks. Like the 2000-2002 Bear market cycle, where many of the US stocks didn’t start their Bull run until March 2003, I think the same will happen here between the non-financials and financials. There are just too many issues that the financial services industry, the central banks and finance ministers, the regulators and legislators must deal with, and the end result will not be known until a couple months after the installation in January 2009 of the new US President.

So, my thinking is that the Financials are good for a trade here – probably +10% or more on the closing positions of short-sellers, and by the self-interested parties in the industry who manage OPM. But at the end of the day, consider that a trade.

Where you can best position long-term portfolios for capital growth is in the Energy, Basic Materials, Industrials and Technology sectors. A few days ago I gave a list of stocks (was it in the Week In Review of two weeks ago?). Also I recall pointing you to Barrick and Goldcorp, which happened to be up +13.0% and +11.0% yesterday. And, after I posted a BUY recommendation on Goldcorp late last week, which Seeking Alpha picked up with a nice headline, GG jumped +13.7% that day.

During the day today and tomorrow, I anticipate massive swings in prices. HB&B traders will be trying to pick your pockets.

The capital markets, whether you trade equities or bonds, or the contract markets of options, futures, forex, and commodities, are not a bed of roses. There is huge risk if you make the wrong decisions. But, if your timing is on the mark, then large profits can be made, especially if you look after risk management first and profit-seeking second.

All I’m trying to do in this blog is inform, educate and facilitate. Hopefully, by doing so, many people in this community are benefitting.

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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:

At least one RSI value <30:

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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 14: Dow 30 List

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)

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The Americas

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

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

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

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Sector ETF Summary for the US equity market

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

Table 1: Cara ETF List

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 XLK SPY . 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.

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10 (energy: XLE)

Table 2: Senior oil & gas equities

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15 (basic materials: XLB)

Table 3: Senior metals and steel equities

Table 12: Senior gold equities

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20 (industrial: XLI)

Table 4: Senior capital goods makers and transportation

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25 (consumer discretionary: XLY)

Table 5: Senior consumer discretionary equities

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30 (consumer staples: XLP)

Table 6: Senior consumer staples equities

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35 (healthcare: IYH)

Table 7: Senior healthcare equities

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40 (financial: XLF)

Table 8: Senior financial company equities

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45 (technology, semiconductor: SMH)

Table 9: Senior technology equities

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50 (telecom: IYZ)

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55 (utilities: XLU)

Table 12: US Utilities

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International Equity Market USD-denominated ETF Review

Table 13: International equities perspective

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Japanese equity market ETF: EWJ

Here is the Japanese (EWJ) equity market ETF Daily data charts:

Interactive EWJ Daily data:

Interactive EWJ Weekly data:

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U.K. equity market ETF

Here is the United Kingdom (EWU) equity market ETF Daily data charts:

Interactive EWU Daily data:

EWU Daily data:

Interactive EWU Weekly data:

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Canada's equity market

Here is the Canadian (EWC) equity market ETF Daily data charts:

Interactive EWC Daily data:

Interactive EWC Weekly data:

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Bonds & Yields Review

Table 10: Yahoo Finance U.S. Treasury Debt, Municipal and Corporate Bond Yields

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

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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:

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Table 11: Interest-sensitive securities

Consumer Finance -USA -- Interactive Daily Data Charts

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Commodities Review

$CRB Index

Open Futures Contracts

Interactive Chart of Daily CRB Commodities Index:

Interactive Chart of Weekly CRB Commodities Index:

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Oil Review

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

Interactive Chart of Daily Crude Oil:

Interactive Chart of Weekly Crude Oil:

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Gold & Precious Metals Review

Spot gold chart for the week

Interactive Chart of Daily Gold EOD Continuous Contract Index:

Interactive Chart of Weekly Gold EOD Continuous Contract Index:

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Spot silver chart for the week

Interactive daily data

Interactive Chart of Daily Silver EOD Continuous Contract Index:

Interactive chart of the Silver Bullion index.

Interactive Chart of Weekly Silver EOD Continuous Contract Index:

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Spot platinum chart for the past three days

Interactive Chart of Daily Platinum EOD Continuous Contract Index:

Interactive Chart of Weekly Platinum EOD Continuous Contract Index:

Interactive chart of the Platinum metal index.

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Spot palladium chart for the week

Interactive Chart of Daily Palladium EOD Continuous Contract Index:

Interactive Chart of Weekly Palladium EOD Continuous Contract Index:

Interactive chart of the Palladium metal index.

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Interactive Chart of Weekly Copper EOD Continuous Contract Index:

Interactive Chart of Daily Copper EOD Continuous Contract Index:

Interactive chart of the Copper metal index.

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Table 12: Senior gold equities

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

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Here are the key Silver miners and the SLV ETF:

SLV SIL CDE HL PAAS SSRI SLW MGN

Interactive Daily data
Interactive Weekly data

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

Interactive Chart of Daily U.S. Goldminers Index:

Weekly U.S. Goldminers Index:

Interactive Chart of Weekly U.S. Goldminers Index:

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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 Daily data:

GDX Weekly data:

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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 Daily data:

Interactive Chart of XGD Weekly data:

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Forex Review

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

Interactive Chart of Daily U.S. Dollar Index:

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

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Daily British Pound Index:

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Daily Japanese Yen Index:

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Daily Canadian Dollar Index:

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Wrap-up