STOCK MARKET WATCH, Thursday 23 March

SECTOR VALUATION ANALYSIS

Last week I read the Bank Credit Analyst U.S. Equity Sector Strategy released on Thursday (03/16/06) entitled, “Green Light For Energy When The Fed Stops Tightening.” The piece commented on asset manias over the past decade and compared the technology mania seen in the late 1990s to the current energy mania. I have included the articles comments and graph below:

“True, energy stocks have already rallied significantly, but the rally has been totally driven by profits. P/E ratios in the energy sector have declined markedly in the past several years, despite the steady rise in share prices. This is in stark contrast to the multiple expansion-driven rally in tech stocks in the late 1990s. We doubt energy stocks will be greeted with the same speculative zeal as tech stocks, because after all, energy remains a commodity. Still, there is room for some modest multiple expansion once the Fed is widely seen to be going on hold, as evidenced by yesterday’s sharp rally in energy stocks (despite lower oil prices) following the release of the benign Fed Beige Book.”

The article sparked my curiosity and I decided to use the Ford Equity Research Value Graphs to look at the valuation of the S&P 500 sectors. The Ford Value Graphs use the high and low P/E extremes (for a stock or index) multiplied by the 12-month operating earnings per share to come up with high and low valuation bands. These bands are similar to Bollinger Bands that give a statistical measure of the significance of the current variable in relation to its extremes over a set time period. The Ford Value Graphs help give an indication of whether or not a stock/index is undervalued or overvalued as well as giving a graphical illustration of the earnings trend for an index/stock.

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I’d like to make two observations in regard to the DJIA and the S&P500. First, both the DJIA and the S&P500 hit their 10-year upper P/E extremes in 1999 and stayed there until they rolled over in 2000. Second, they both underwent mean reversion back to normal levels and then had a major sell off in 2002 that drove both indexes to their 10-year lower P/E extreme. At this point the markets were undervalued and a rally ensued. The second observation I’d like to make is that when looking at their 3-year charts, P/E compression is seen where the upper P/E extreme driven by the 1990s market mania has fallen from 30 to 19 for the Dow and from 28 to 20 for the S&P 500. Note that the lower P/E extreme remained constant for the DOW and fell slightly, from 17 to 16, for the S&P500. This implies that the 10-year upper extreme truly was an extreme caused from a market mania while the lower P/E is seen as a true lower value not caused by a mania of fear as it was not compressed but returned to a “normal” lower extreme value seen previously.

-see charts-

more...

http://www.financialsense.com/Market/wrapup.htm

8:30 AM Initial Claims 03/18
Briefing Forecast 295K
Market Expects 305K
Prior 309K

10:00 AM Existing Home Sales Feb
Briefing Forecast 6.40M
Market Expects 6.50M
Prior 6.56M

8:30 AM ET 3/23/06 U.S. 4-WK. AVG. CONTINUING CLAIMS LOWEST SINCE FEB. 2001

8:30 AM ET 3/23/06 U.S. CONTINUING JOBLESS CLAIMS RISE 38,000 TO 2.472 MILLION

8:30 AM ET 3/23/06 U.S. INITIAL WEEKLY JOBLESS CLAIMS FALL 11,000 TO 302,000

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B14BCD0BF%2D754E%2D4CFD%2D82B2%2DD37936747B4C%7D&dist=newsfinder&symbol=&siteid=mktw

WASHINGTON (MarketWatch) -- First-time claims for state unemployment benefits fell by 11,000 to 302,000 in the week ending March 18, the Labor Department said Thursday. It's down from a revised 313,000 and is the lowest since Feb. 24. The number of people continuing to collect unemployment benefits, meanwhile, rose by 38,000 to 2.472 million, the highest since Feb. 25. The four-week average of continuing claims hit a five-year low of 2.469 million.

10:00 AM ET 3/23/06 JUMP IN FEB. HOME SALES DUE TO WARM JAN. WEATHER: NAR

10:00 AM ET 3/23/06 U.S. JAN. EXISTING HOME SALES REVISED 6.57MLN VS. 6.56MLN

10:00 AM ET 3/23/06 U.S. FEB. EXISTING HOME INVENTORIES UP 5.2% TO 3.03MLN

10:00 AM ET 3/23/06 U.S. FEB. EXISTING HOME MEDIAN PRICE UP 10.6% Y-O-Y

10:00 AM ET 3/23/06 U.S. FEB. EXISTING HOME SALES HIGHER THAN 6.52MLN EXPECTED

10:00 AM ET 3/23/06 U.S. FEB. EXISTING HOME SALES UP 5.2% TO 6.91MLN

http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B26FBA5C9%2D9CBF%2D4D44%2D873E%2D9D47F58F8FA4%7D&dist=newsfinder&symbol=&siteid=mktw

WASHINGTON (MarketWatch) -- Resales of U.S. homes unexpectedly increased 5.2% in February to a seasonally adjusted annualized rate of 6.91 million, the National Association of Realtors said Thursday. Economists were expecting sales of about 6.52 million. The boost in sales in February was likely due to warmer than usual weather in January, when sales that were closed in February were initiated, the realtors said. The supply of unsold homes also rose 5.2% in February to 3.03 million, close to the all-time record of 3.04 million in 1986. The inventory represents 5.3 months supply, unchanged from January. Median prices are now up 10.6% year-over-year to $209,000.

I wonder if all those "sales" on the courthouse steps are being put into this formula? :eyes:

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-03-23T150451Z_01_N23185324_RTRIDST_0_ECONOMY-HOMES-URGENT.XML

WASHINGTON, March 23 (Reuters) - Sales of existing U.S. homes climbed 5.2 percent in February, defying expectations for a slowdown, as unseasonably warm weather boosted sales of both single-family homes and condos, according to trade group data on Thursday that showed a pause in the market's cool-down.

Sales of existing U.S. homes rose to a 6.91 million unit annual rate in February from January's upwardly revised 6.57 million unit pace, according to the National Association of Realtors. The existing homes sale figure includes both single-family homes and condos.

Analysts had forecast existing homes sales at a 6.50 million unit pace in February, down from January's originally reported 6.56 million unit pace.

But the Realtors' group called February's sales figures an aberration due to both warm weather and lower mortgage rates in January that boosted buying activity. The group's chief economist said the pace of home resales should start to slow again next month.

The increase in total sales - the biggest in two years - was driven by a 4.7 percent gain in the pace of single-family sales and an 8.8 percent jump in condo sales in February, the Realtors data showed.

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hmmm... condos? Usually those are the things that go into foreclosure first - high homeowner's dues, taxes, ARMs.... :eyes:

kind of flies in the face of that report - together with the demand for loans falling :eyes:

(edited for clarity)

http://money.cnn.com/2006/03/22/real_estate/homeownership_study/index.htm

NEW YORK (CNNMoney.com) - The rate of home ownership for low- to moderate-income families with children is lower than in 1978, even as the overall rate of home ownership increases, according to a study from the Center for Housing Policy released Wednesday.

The study found that only 59.6 percent of working class families owned their homes in 2003, the most recent year for which figures were available, down from 62.5 percent in 1978.


Meanwhile, home ownership in the overall population has risen to 68.3 percent in 2003 from 65.2 percent in 1978. The study is based upon Census Bureau data.

According to the Center, that translates into 2.3 million children who would be living in owner-occupied housing if the rates had remained the same.

The study defines working class families are ones whose earnings range from $10,700, or the equivalent of working 40 hours a week at minimum wage, and up to 120 percent of the median income in their area.

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SINGAPORE - Oil prices rebounded Thursday, recovering most of their losses the previous day, after U.S. government data showed domestic supplies of oil and gasoline shrank last week.

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Gasoline rebounded 1.09 cent to $1.7474 a gallon after plunging 10.3 cents, or 6 percent, on Wednesday.

Heating oil rose marginally to $1.7455 a gallon, while natural gas gained 8.2 cents to $7.035 per 1,000 cubic feet.

In its latest weekly report, the U.S. Energy Department said Wednesday that domestic inventories of crude oil declined by 1.3 million barrels last week to 338.6 million barrels, or 9 percent above year-ago levels. The agency said gasoline inventories fell by 2.3 million barrels to 221.6 million barrels, or 1 percent higher than last year.

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10:31 AM ET 3/23/06 U.S. NATURAL GAS SUPPLY DOWN 23 BLN CUBIC FT: ENERGY DEPT

11:23 AM ET 3/23/06 MAY CRUDE TAPS A THREE-SESSION HIGH OF $63.60/BRL

11:23 AM ET 3/23/06 MAY CRUDE LAST UP $1.58, OR 2.6%, AT $63.35/BRL

11:23 AM ET 3/23/06 APRIL NATURAL GAS RISES 20.7C, OR 3%, TO $7.16/MLN BTUS

2:59 PM ET 3/23/06 MAY CRUDE CLOSES AT $63.91/BRL, UP $2.14, OR 3.5%

2:59 PM ET 3/23/06 APRIL NATURAL GAS UP 5%, ENDS AT 1-MO HIGH OF $7.328/MLN BTU

NEW YORK (Reuters) - Consumer demand for home mortgage loan applications fell last week to the lowest level this year despite a marked drop in interest rates, as industry trade group said on Wednesday.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity or the week ended March 17 decreased 1.6 percent to 565.0 from the previous week's 574.4, its lowest level of 2006.

"It is very evident that the steam is coming out of the housing market even though rates moved down," said Celia Chen, director of housing economics at Moody's Economy.com, a consulting firm.

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:donut: I am really concerned about the RE market now. It is not looking so good. I found out one of the reasons why Tx has such a high forclosure number-Texas allows 27 days to foreclose. I know some states have a much longer process. We use to have homestead exemption laws and you could not take equity out of your house-but then you didn't get thrown out of your house so easily either. I really fought the changing of the law because I thought it irresponsible to extract so much equity out of your home (not to mention all of those questionable loan sharks that were backing the changes)-but it passed anyway. I will have to check with a RE person to see how the changes affected homestead rules.

Oh and Babs will be out today visiting some Katrina evacuee kids at a local middle school. Guess she want to make sure they are 'making out nicely':sarcasm:. Oh to be a parent with a kid over there. I'd add a little spice to that dog and pony photo op show.

Happy hunting and watch out for the bears.

So that those members of a family would always have their home - the equity was secured for them.

It all changed in 1997 -

http://www.thomas-law.com/equityloans.html



Change in Texas Law May Make Reverse Mortgages More Popular

Texas was one of the last states to allow homeowners to take out home equity loans. Laws going back to the nineteenth century strictly prohibited home equity lending, as legislators feared that unscrupulous lenders would take advantage of homeowners for the purpose of seizing their homes through foreclosure. This made it impossible for citizens of the Lone Star State to use their equity for home improvements, debt consolidation or paying medical bills, as homeowners in other states may do.

In 1997, the Texas constitution was amended to allow homeowners to borrow against their home equity. The amendment allowed for traditional term loans, lines of credit, and reverse mortgages, but did not allow a line of credit on a reverse mortgage.

In a reverse mortgage, owners of homes who are at least 62 years of age may borrow against the equity in their home. They need not pay the money back until they die, move or sell the home. Reverse mortgages have become quite popular in the last few years, especially in areas like California, where homeowners may be cash poor but may have a lot of equity in their homes. Nationally, nearly 90% of homeowners who take out a reverse mortgage do so with a line of credit. In Texas, however, the only options are a lump sum or monthly payments. There are several advantages in taking a reverse mortgage in the form of a line of credit, rather than a lump sum. The most significant is the fact that interest is only due when money is actually drawn from the credit line. This saves the homeowner substantial amounts of interest over the life of the loan when compared to a lump-sum payout. Reverse mortgages have been quite popular in Texas since the law was changed to allow them, but lenders say that the demand should increase substantially if lines of credit are allowed.

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I forgot your background. Let's see, who was the Gov in '97 :think:
Oh yah, it was Dubya:sarcasm:
Bet the loan sharks contributed substantial to his war chest, as I recall he had a big slush fund.
I'm all for people making choices in their life, but I really hate to see people becoming desperate and doing stupid thing after being smooth talked by a snake oil salesman. These lending companies are everywhere and ready to pounce.
The old laws were better. At least no one ended up homeless.

http://quotes.ino.com/chart/?s=NYBOT_DX

Last trade 89.88 Change +0.01 (+0.01%)

Dollar Bound To Ranges While Speculation Gears Up

http://www.dailyfx.com/story/dailyfx-financial-markets-headlines/dailyfx-financial-markets-headlines/7491-dollar-bound-to-ranges-while-speculation-gears.html

The US dollar had little on its palette in terms of economic data today, leaving market participants to contemplate already released indicators this week and speculate on next week’s active calendar. Action in the dollar-backed majors was largely choppy. Against the euro, the greenback advanced only 20 pips, after hours of trading in a 50-pip range, from yesterday’s 1.2096, New York session close. The largest gain the dollar made amongst the four large pairs was in the USDCHF. The pair made a new weekly high 1.3057, before trading back slightly to 1.3050 by 19:22 GMT. Trading in the GBPUSD had the pair hovering around par with Tuesday’s New York session close at 1.7575 after a second day of trading within a 50-pip range constraint. Finally, the yen was the only currency among the majors to gain in ground against the greenback. An early session decline in the USDJPY weighed the pair off of highs around 117.40 established in Asian hours all the way down to 116.60. Recently, the dollar was trading around 116.80 to the yen.

With little new fundamental data being put to the market to absorb, traders had time to ruminate over the week’s earlier releases and put speculative bets down on a slew of indicators that will hit the newswire over the coming days. The only market moving indicator offered to the market so far this week has been yesterday’s producer prices. While the market initially rallied on this release, there has been some second guessing on this figure especially with the federal open market committee meeting next Tuesday to determine monetary policy. While growth remains impressive, and core prices actually nudged higher, the mark below expectations will offer another area for policy members to point to that supports a call for normalizing inflation. Also placing some weight on speculators for the upcoming rate decision will be Friday’s February durable goods orders. Expected to have grown 1.3 percent for the period, a realized reversal in orders will help to secure expansion numbers in lieu of receding price levels.

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Protectionism - Death of the Dollar?

http://www.dailyfx.com/story/dailyfx-reports/daily-fundamentals/7495-protectionism---death-of-the.html

US Dollar
With no US economic data released today, the dollar continued to quietly gain strength against the majors. The only currencies that managed to rally against the dollar were the two high yielders that lost the most ground this week, namely the Australian and New Zealand dollars. Tomorrow is not expected to be very different since the only piece of data due out is jobless claims. The lack of a meaningful reaction stems from the fact that claims will do little to change the market’s opinion on rates. With the count down now at 7 days until the next Fed rate decision, there is no question that we will see rates at 4.75 percent by the end of this month. Therefore we take this opportunity to talk about a broader theme that may affect the dollar in the months to come. Today, the World Trade Organization warned the US against shooting themselves in the foot by exercising too much protectionism. The report was written before the UAE Ports deal and likely relates to the failed bid by China to purchase Unocal last July. The two US Senators that have caused a lot of fan fare by threatening to impose high tariffs on Chinese goods are also now touring China to see how much “progress” has been made. Any attempts to inhibit laissez faire tend to lead to disastrous results but more importantly though, attempts at preventing trade and dollar positive cross border acquisitions can only be added to the numerous factors that are pressuring the dollar over the medium to long term.

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Last trade 90.39 Change +0.52 (+0.58%)

Settle Time 15:02 Open 89.86

Previous Close 89.87 High 90.43

Low 89.75 2006-03-23 10:57:21, 30 min delay

http://www.amconmag.com/2006/2006_03_27/review.html

Two hundred years ago, when the United States was a modest commercial republic, the president could take a walk down Pennsylvania Avenue—by himself—and talk to anyone who approached him. If he wasn’t on a walk outdoors, he was most likely at home, and you could speak to him by knocking on the door of the White House and presenting yourself.

The Hamiltonians and their agenda of mercantilism, paper money, and presidential exaltation had been humiliated in the election of 1800. Jeffersonianism had prevailed against them. And though Jefferson made some missteps during his presidency—not even Jefferson could be fully trusted with power—the policy bias was clear: frugality, free trade, peace, hard money, and decentralized government.

Today? The president moves about like Caesar Augustus, with a vast, graded court of civil and military aides, doctors, secretaries, valets, hairdressers, makeup artists, bodyguards, drivers, baggage handlers, cooks, food tasters, Praetorian guards, snipers, centurions, bulletproof limos, a portable hospital, and an armored rostrum. And that’s when he travels in the U.S.

<snip>

The paranoia of the Bush circle has infected the whole regime. The entire government—elected officials, appointed staff, permanent bureaucracy—has shifted in the last decade from pretending to be the people’s servants to admitting that they regard the people as a threat. Thus do we see the stream of legislation permitting ever more powers to spy, confiscate, and jail without trial.

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The authors not only provide a frightening picture of the mess that the U.S. government has made at home and abroad, they also understand the crucial role that the monetary regime has played in this debacle. They show how the legal right to counterfeit—that’s what the Federal Reserve grants the government—has changed the structure of the government and led to the loss of liberty and the rise of an imperial power unlike any in history.

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Hmmmm.... looks like the "conservatives" might be getting a dose of reality. :eyes:

Oh, and btw - the entire article is worth a read :hi:

(thanks to Judi Lynn and this thread:

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x2183340 )

http://www.bloomberg.com/apps/news?pid=10000103&sid=amzVdnivhgdY&refer=us

March 23 (Bloomberg) -- President George W. Bush has tried to sell Americans on an ``ownership society'' that would create more wealth -- and more Republicans in the process. The stock market hasn't accommodated.

The Standard & Poor's 500 Index -- the benchmark for American equities -- is down 2.8 percent since Bush took office five years and two months ago. That's the worst performance during the same stage of any two-term administration in the past half century except that of Richard M. Nixon.

The market's performance is undermining a central goal of White House Deputy Chief of Staff Karl Rove, Bush's chief political adviser. Borrowing from Margaret Thatcher's privatization push in the U.K. in the 1980s, Rove's theory is that if more Americans make their own financial decisions and the last vestiges of a welfare state are dismantled, a culture of ownership will spring up. The ranks of Republican voters, the idea goes, will swell along with it.

``The ownership society looked very attractive on paper,'' said Jacob Hacker, a political science professor at Yale University in New Haven, Connecticut. ``But once you flesh out the changes, people become very concerned because they are already fearful that their economic security is slipping away,''

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http://breakingnews.nypost.com/dynamic/stories/J/JAPAN_NEC_FAKED_SALES?SITE=NYNYP&SECTION=BUSINESS

TOKYO (AP) -- Japanese electronics maker NEC Corp. has launched an internal probe after finding an employee at an engineering unit may have faked business deals and inflated sales by 36.3 billion yen ($310 million) over half a decade.

For the current fiscal year ending in March, the amount of inflated sales at NEC Engineering Ltd. is estimated at 13.3 billion yen ($113.6 million), inflating operating income by 9.3 billion yen ($79.5 million), the Tokyo-based company said in a statement released Wednesday.

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The fictitious purchases and sales, which ran from 2001 to December 2005, are believed to be the product of only one employee, and NEC said it failed to initially detect the problem because "it did not fully confirm all the details" of the transactions.

The falsified earnings come as NEC battles a drop in profits due to increased competition in the chip and mobile phone industry. In the quarter ended Dec. 31, NEC reported a 47 percent drop in net income to 20.78 billion yen ($117.6 million).

...more at link...

Only "one employee" ... :eyes:

9:02 AM ET 3/23/06 FEDERATED'S WASH., D.C. FACILITY EMPLOYS 250 PEOPLE

9:01 AM ET 3/23/06 FEDERATED TO CLOSE DISTRIBUTION CENTER IN WASHINGTON, D.C.

My time is short this morning, just wanted to follow up with AnneD on the Helen Thomas discussion. Sort of goes with today's great toon!

http://www.truthout.org/docs_2006/032206A.shtml

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Helen Thomas: I'd like to ask you, Mr. President, your decision to invade Iraq has caused the deaths of thousands of Americans and Iraqis, wounds of Americans and Iraqis for a lifetime. Every reason given, publicly at least, has turned out not to be true. My question is, why did you really want to go to war? From the moment you stepped into the White House, from your Cabinet - your Cabinet officers, intelligence people, and so forth - what was your real reason? You have said it wasn't oil - quest for oil, it hasn't been Israel, or anything else. What was it?
The President: I think your premise - in all due respect to your question and to you as a lifelong journalist - is that - I didn't want war. To assume I wanted war is just flat wrong, Helen, in all due respect -

Helen Thomas: Everything -

The President: Hold on for a second, please.

Helen Thomas: - everything I've heard -

The President: Excuse me, excuse me. No President wants war. Everything you may have heard is that, but it's just simply not true. My attitude about the defense of this country changed on September the 11th. We - when we got attacked, I vowed then and there to use every asset at my disposal to protect the American people. Our foreign policy changed on that day, Helen. You know, we used to think we were secure because of oceans and previous diplomacy. But we realized on September the 11th, 2001, that killers could destroy innocent life. And I'm never going to forget it. And I'm never going to forget the vow I made to the American people that we will do everything in our power to protect our people.

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just look at the blather...

09:15 am : S&P futures vs fair value: -0.3. Nasdaq futures vs fair value: -4.0. GM has announced that it has sold a 78% stake in GMAC for about $9 billion in cash and assumed debt to an investor group led by Kohlberg Kravis Roberts, Five Mile Capital Partners, and Goldman Sachs Capital Partners. Futures trade is little changed, and still suggests a lower open for the cash market.

09:01 am : S&P futures vs fair value: -1.0. Nasdaq futures vs fair value: -5.0. Futures trade continues to signal a downside start for stocks. The host of uninspiring earnings reports and earnings outlooks continues to dampen sentiment, and Adobe (ADBE) is particularly weighing on the Nasdaq. A rebound (+0.7%) in the price of crude, to $62.21, isn't helping things. On a positive note, General Mills beat earnings estimates by four cents. The company met revenue expectations and reaffirmed its FY06 guidance, the high end of which matches the consensus estimate.

NEW YORK (Reuters) - U.S. stock futures pointed to a flat market opening on Thursday, with upbeat earnings news from companies including General Mills Inc. (NYSE:GIS - news) offsetting a disappointing outlook from software maker Adobe Systems Inc. (Nasdaq:ADBE - news)

General Mills, maker of Cheerios cereal and Progresso soup, reported stronger-than-expected quarterly earnings, and its shares rose in light volume before the opening bell.

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Adobe posted lower quarterly net income on acquisition-related costs and gave a disappointing outlook in a second day of gloomy news for the tech sector. RBC Capital Markets cut its rating on Adobe, whose shares fell before the bell.

Standard & Poor's 500 futures were down 1.5 points, but were even with fair value, a mathematical formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract.

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CHICAGO (Reuters) - ConAgra Foods Inc. (NYSE:CAG - news) on Thursday posted a quarterly loss, hurt by higher costs and charges related to restructuring and litigation.

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ConAgra, whose brands include Healthy Choice frozen meals, Peter Pan peanut butter and Hebrew National hot dogs, posted a net loss of $31.7 million, or 6 cents a share, for the third quarter ended February 26. That compared with a profit of $165.3 million, or 32 cents a share, a year earlier.

Excluding one-time items, it earned 37 cents a share, beating analysts' average expectation of 34 cents, according to Reuters Estimates.

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9:33
Dow 11,306.15 -11.28 (-0.10%)
Nasdaq 2,298.85 -4.50 (-0.20%)
S&P 500 1,303.22 -1.82 (-0.14%)
10-Yr Bond 46.97 -0.06 (-0.13%)
NYSE Volume 40,080,000
Nasdaq Volume 58,642,000

Dow 11,307.51 -9.92 (-0.09%)
Nasdaq 2,300.47 -2.88 (-0.13%)
S&P 500 1,303.10 -1.94 (-0.15%)
10-Yr Bond 4.699 -0.04 (-0.09%)

NYSE Volume 310,881,000
Nasdaq Volume 358,729,000

10:00 am : The market is vacillating around the unchanged mark. Just two of the ten economic sectors are lending support, and their gains are countered by losses across the rest of the market. At this point, Energy (+0.8%) is leading trade. Crude oil's rebound and gains in gasoline, natural gas, and heating oil have helped renew some buying interest across the sector. The Materials sector (+0.3%) is also trending higher. On the other side of the aisle, it's the rate-sensitive areas that are faring worst. The Financial sector is levying a 0.3% loss, while Utilities (-0.4%) and the homebuilding industry are also declining. DJ30 +2.08 NASDAQ -1.23 SP500 -1.38 NASDAQ Dec/Adv/Vol 1239/1166/187.8 mln NYSE Dec/Adv/Vol 1513/1107/65.9 mln

09:40 am : As futures trade had presaged, the stock market opened in the red. A round of relatively disappointing profit reports and earnings outlooks is weighing on sentiment. Adobe (ADBE), which beat estimates but issued downside guidance, is a particular drag. YRC Worldwide (YRCW), Carnival Corp (CCL), and Scholastic Corp. (SCHL) also disappointed the market. Crude's 0.8% rise to $62.26 per barrel isn't helping matters, but the price remains within its recent range. Building anticipation ahead of the FOMC meeting may help keep action in check. With respect to today's economic calendar, new claims for unemployment for the week ended March 18 were 302,000 - in-line with expectations and with the recent trend. The market awaits existing home sales data (10:00 ET). Economists anticipate an annual rate of 6.50 million - a reading that would mark the series' sixth straight decline. New home sales data will be released tomorrow. On a related note, KB Homes (KB) delivered better than expected earnings after yesterday's bell, but cautioned that it will likely see pullbacks in some markets this year. DJ30 -6.80 NASDAQ -3.28 SP500 -1.48

Dow 11,273.73 -43.70 (-0.39%)
Nasdaq 2,291.26 -12.09 (-0.52%)
S&P 500 1,299.62 -5.42 (-0.42%)
10-Yr Bond 4.725 +0.22 (+0.47%)

NYSE Volume 551,135,000
Nasdaq Volume 608,499,000

10:30 am : Following the better than expected Existing Homes Sales report, the homebuilding industry fully erased its early loss, and it's now registering a gain. The broader market, though, hasn't caught a similar bid. Existing home sales rose to a 6.91 million annual rate in February, which is above the 6.50 million rate that analysts had anticipated. Still, it's is the third straight level below a 7 million rate (the rate had been above 7 million every month from April through November of 2005). The data doesn't alter expectations that home sales will drift lower over the year ahead. Comments from KB Homes (KBH 65.84 +1.25) feed the argument that the housing sector is slowing, and the market awaits the New Home Sales report tomorrow. Treasuries, meanwhile, have taken a bearish cue from the data because of the fact that it was better than expected. Rising yields are weighing on stocks.DJ30 -19.69 NASDAQ -7.62 SP500 -3.35 NASDAQ Dec/Adv/Vol 1434/1159/385.7 mln NYSE Dec/Adv/Vol 1555/1292/206.7 mln

Must be getting harder to cook those books :eyes:

Snow-No timetable for U.S. forex practices report

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2006-03-23T164937Z_01_WBT005025_RTRIDST_0_ECONOMY-SNOW-URGENT.XML

HAGERSTOWN, Maryland, March 23 (Reuters) - U.S. Treasury Secretary John Snow on Thursday said he still was unable to say when a hotly awaited report on currency practices of major trading partners, including China, will be issued.

"We don't have a precise timetable on that," Snow said in answer to a reporter's question after touring a Volvo truck engine-making plant.

"That's being worked on," he added. The currency report is issued twice a year and normally would come in April but it is often delayed.

Snow visited the manufacturing plant to highlight the Bush administration's drive to attract foreign investment in the wake of the Dubai Ports World decision, which kept a United Arab Emirates company from taking over management of some U.S. ports.

Snow said the U.S. economy was on a good growth path, partly because of healthy foreign investment and data on weekly jobless claims issued on Thursday reinforced that point.

...more that obscures the lack of filing of a mandated report from the Treasury Department...

Snow says U.S. welcomes foreign investment

http://today.reuters.com/misc/PrinterFriendlyPopup.aspx?type=bondsNews&storyID=uri:2006-03-23T180421Z_01_N23266730_RTRIDST_0_ECONOMY-SNOW-UPDATE-1.XML

excerpt:

Snow was asked to comment on the Dubai Ports World deal in which a United Arab Emirates company had sought to take over management of some U.S. ports, provoking an angry U.S. reaction that eventually resulted in the UAE company dropping its deal.

"I'm pleased to again emphasize that America welcomes investment from abroad," Snow said. "America is open for foreign investment, we attract an enormous amount of foreign investment every year. We want to continue to make America a place that is the best place in the world to invest."

The Bush administration was taken by surprise at congressional anger over the proposed ports deal and is aiming to make the case that the United States still wants foreign investment.

<snip>

In 2005, the U.S. trade deficit climbed 17.5 percent to a record $725.8 billion and the deficit with China shot up 24.5 percent from 2004 to a record $201.6 billion.

<snip>

There are signs already the Chinese government is pushing back against U.S. pressure, including a comment from Chinese Premier Wen Jiabao reported on Wednesday by the Financial Times newspaper that the United States must take responsibility for its own economic imbalances.

...more...

:spray:

:rofl:

I have seen some of these women ply their wares in the street....they are usually not that eloquent. Guess that is the difference between a street hooker and a high class call girl or to paraphrase Slim Whitman to Harvey Korman in Blazing Saddle "You uses yor mouth better than a $20 Whore" :rofl:

(who wrote "Sorrows of Empire" and has a new book coming out)

From an Interview:

http://www.counterpunch.org/engelhardt03232006.html

Whatever Happened to Congress?
By TOM ENGELHARDT


Johnson:

The high-growth economies of East Asia now hold huge amounts in American treasury certificates. If the dollar loses its value, the last person to get out of dollars loses everything, so you naturally want to be first. But the person first making the move causes everyone else to panic. So it's a very cautious, yet edgy situation.

A year ago, the head of the Korean Central Bank, which has a couple of hundred billion of our dollars, came out and said: I think we're a little heavily invested in dollars, suggesting that maybe Dubai's currency would be better right now, not to mention the euro. Instantaneous panic. People started to sell; presidents got on the telephone asking: What in the world are you people up to? And the Koreans backed down--and so it continues.

There are smart young American Ph.D.s in economics today inventing theories about why this will go on forever. One is that there's a global savings glut. People have too much money and nothing to do with it, so they loan it to us. Even so, as the very considerable economics correspondent for the Nation magazine, William Greider, has written several times, it's extremely unwise for the world's largest debtor to go around insulting his bankers. We're going to send four aircraft-carrier task forces to the Pacific this summer to intimidate the Chinese, sail around, fly our airplanes, shoot off a few cruise missiles. Why shouldn't the Chinese say, let's get out of dollars. Okay, they don't want a domestic panic of their own, so the truth is they would do it as subtly as they could, causing as little fuss as possible.

-------------
What I wonder is how will anyone know when China and Japan start to "ease out?" :eyes:

11:53 AM ET 3/23/06 MAY COPPER UP 2% AT $2.384/LB AFTER A RECORD $2.386

11:52 AM ET 3/23/06 APRIL GOLD FALLS $2.20 TO $549.50/OZ AFTER $544.80 LOW

11:52 AM ET 3/23/06 MAY SILVER UP 1.2% AT FRESH 22-YEAR HIGH OF $10.63/OZ

1:46 PM ET 3/23/06 CORRECT: MAY SILVER SETTLES UP 19.5C AT $10.69/OUNCE

1:43 PM ET 3/23/06 APRIL PLATINUM SETTLES UP 40C AT $1,046.40/OUNCE ON NYMEX

1:43 PM ET 3/23/06 JUNE PALLADIUM SETTLES DOWN $2.75 AT $323.20/OUNCE ON NYMEX

1:42 PM ET 3/23/06 APRIL GOLD SETTLES DOWN 90C AT $550.8/OUNCE ON NYMEX

1:40 PM ET 3/23/06 MAY COPPER SETTLES UP 5.9C AT $2.398/POUND ON NYMEX

Dow 11,289.98 -27.45 (-0.24%)
Nasdaq 2,300.08 -3.27 (-0.14%)
S&P 500 1,302.84 -2.20 (-0.17%)
10-Yr Bond 4.739 +0.36 (+0.77%)

NYSE Volume 1,024,106,000
Nasdaq Volume 1,076,130,000

12:30 pm : Fading further, the market continues to retrace some of yesterday's gains. Along with Energy (+1.1%), the semiconductor industry is helping to limit the indices' declines. Currently, the Philadelphia Semiconductor Index (SOX) is up 0.9%. Driving its advance is Advanced Micro Devices (AMD 35.42 +1.05). The chip maker is benefiting from news that Dell (DELL 30.31 -0.10), which exclusively uses Intel (INTC 19.89 -0.09) chips, has purchased Alienware. Alienware, which is a maker of high-end personal computers favored by gamers, uses AMD chips. Despite relative strength in that influential industry group, the Tech sector continues to post a 0.5% loss and the Nasdaq remains submerged. With respect to the latter, a drop in biotechnology is a contributing factor.DJ30 -52.43 NASDAQ -8.99 SP500 -4.83 NASDAQ Dec/Adv/Vol 1567/1303/959.2 mln NYSE Dec/Adv/Vol 1716/1383/642.3 mln

12:00 pm : Sellers remain in control of the trading action as the market enters the noon hour. Interest rate concerns are weighing on investors' sentiment, and a round of disappointments from the earnings front exacerbates a bearish bias.

On Tuesday, the FOMC will announce what is widely expected to be another rate hike. Anxiety ahead of that, and ahead of the accompanying policy directive, is building. Today's economic calendar featured a better than expected reading from the housing sector, and the data is fanning rate worries. In February, existing home sales rose to a 6.91 million annual rate. It's still the third consecutive month that the series has checked in below the 7 million annual rate, but, nonetheless, the reading was well above expectations. The Fed has asserted that monetary policy will be dependent upon the economic data, and today's housing report suggests that the data has not deteriorated to the point that the Fed would have reason to pause. To that point, the Treasury market is taking a bearish cue. Rising yields are weighing on the equity market, and rate-sensitive areas are faring especially poorly. The Financial sector is levying a weighty 0.5% loss, as is the Utilities sector.

Conversely, the date helped the homebuilding industry erase its early loss. A sore spot there had been KB Homes (KBH 67.48 +2.89). The company beat earnings estimates and reaffirmed its full-year guidance, but, like many of its peers, cautioned that softness in some markets is likely. Tomorrow, the February New Home Sales Report will be released, and it's apt to garner some added attention. Further to the earnings front, the software industry is a particular pocket of weakness following downside guidance from Adobe Systems (ADBE 35.71 -0.91). There are a few bright spots helping to offset its effect, namely upgraded Yahoo (YHOO 31.69 +0.94) shares and Advanced Micro Devices (AMD 35.50 +1.13), but selling across the tech board is wide-spread and stunting the sector's advance. With respect to AMD, the stock is benefiting from Dell's (DELL 30.46 +0.05) acquisition of Alienware - which uses AMD chips.

Due largely to a profit warning from trucking company YRC Worldwide (YRCW 38.68 -6.61), transportation industries are weak and weighing on the Industrials sector (-0.8%). Healthcare (-0.7%) is suffering from some broad-based selling and is also booking a significant loss. The market's best source of support is the Energy sector. A spike in energy prices has driven buyers back to energy stocks, but the fact that crude is about 3% higher to $63.50 per barrel today, and out of its recent range, is not helping the broader market. DJ30 -48.26 NASDAQ -7.64 SP500 -4.14 NASDAQ Dec/Adv/Vol 1505/1325/862.5 mln NYSE Dec/Adv/Vol 1690/1373/572.0 mln

NEW YORK (Reuters) - U.S. stocks fell on Thursday, hit by a drop in transportation shares and news of surprising strength in the housing sector, which renewed worries about interest rates and pushed up bond yields.

Trucking company YRC Worldwide Inc. (Nasdaq:YRCW - news) warned that first quarter earnings would be much lower-than-expected, due to soft volumes and cost overruns.

"The underlying economy is coming along, so when a company as big as YRC comes out with that ... it gives everybody a little bit of pause," said Cummins Catherwood, managing director of Walnut Asset Management.

more...

cross-posting from this thread:

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=102&topic_id=2183213&mesg_id=2183213

http://www.dailytexanonline.com/home/index.cfm?event=displayArticlePrinterFriendly&uStory_id=032e0948-f51e-49ad-b48d-0edce51caff8



http://www.nabe.org/press/Clips/clip051305.htm



http://www.akingump.com/attorney.cfm?attorney_id=324

Dow 11,258.04 -59.39 (-0.52%)
Nasdaq 2,293.69 -9.66 (-0.42%)
S&P 500 1,300.13 -4.91 (-0.38%)
10-Yr Bond 4.735 +0.32 (+0.68%)

NYSE Volume 1,331,211,000
Nasdaq Volume 1,391,108,000

2:00 pm : Little has changed within the stock market. One area that is demonstrating some interesting relative strength is the retail industry. The apparel group is the standout - currently up about 1%. Home improvement retail is another notable pocket of strength. There, it's Home Depot (HD 43.94 +0.57) that is leading the advance. The stock is trading in sympathy with the homebuilding industry, as it appears to be similarly benefiting from today's better than expected housing data. As a whole, retailers are showing resilience in the face of interest rate anxiety and spiking energy costs. At this point, crude is 3.3% higher and is pushing $64 per barrel.DJ30 -44.17 NASDAQ -5.49 SP500 -3.19 NASDAQ Dec/Adv/Vol 1507/1428/1.28 bln NYSE Dec/Adv/Vol 1663/1517/869.0 mln

1:30 pm : The recent recovery attempt has stalled, and the indices have edged lower. Meanwhile, the Treasury market continues to suffer. Yields are up across the curve. At the back end, which is the most inflation-sensitive, the 30-year note is down 11 ticks and up to a 4.74% yield. The benchmark 10-year note, meanwhile, is off seven ticks and yielding 4.73%. A week ago, that bond was offering 4.64%. Today's better than expected housing data continues to be the catalyst behind the Treasury action. The reading adds to what had already been some anxiety ahead of the upcoming (Tuesday) FOMC policy decision and directive. Treasuries continue to occupy much of stock traders' attention, and, as such, are contributing to the equity market's bearish bias. DJ30 -41.44 NASDAQ -6.01 SP500 -3.51 NASDAQ Dec/Adv/Vol 1487/1434/1.19 bln NYSE Dec/Adv/Vol 164/1504/798.5 mln

Dow 11,255.64 -61.79 (-0.55%)
Nasdaq 2,293.96 -9.39 (-0.41%)
S&P 500 1,300.15 -4.89 (-0.37%)
10-Yr Bond 47.35 +0.32 (+0.68%)
NYSE Volume 1,350,754,000
Nasdaq Volume 1,409,685,000

Dow 11,257.16 -60.27 (-0.53%)
Nasdaq 2,298.09 -5.26 (-0.23%)
S&P 500 1,301.09 -3.95 (-0.30%)
10-Yr Bond 47.37 +0.34 (+0.72%)
NYSE Volume 1,622,514,000
Nasdaq Volume 1,679,722,000

3:00 pm : The market continues to fade. Eight of ten sectors remain submerged. Despite some upside earnings reports, the Consumer Staples sector (-0.5%)has been able to overcome selling pressure. This morning, General Mills (GIS 50.23 +0.25) delivered earnings that beat expectations by four cents per share. The company met expectations for its revenue growth, and reaffirmed its full-year guidance range - the high end of which matches the consensus estimate. ConAgra (CAG 20.49 +0.23), meanwhile, beat EPS projections by three cents. The stock's upside appears to be dampened by the fact that the company disappointed on the top line. The sector is also getting some solid support from Sysco (SYY 32.40 +0.92), which is enjoying an analyst upgrade. Like the broader market, the Staples sector is experiencing some wide-spread selling that offsetting its pockets of strength.DJ30 -71.16 NASDAQ -11.57 SP500 -6.08 NASDAQ Dec/Adv/Vol 1609/1378/1.52 bln NYSE Dec/Adv/Vol 1780/1420/1.04 bln

http://tinyurl.com/kleyc


>>
The chief of the U.S. Pension Benefit Guaranty Corp. announced his resignation Thursday, as efforts continue in Congress to shore up the financially troubled government agency.
"This past two years has been a particularly tumultuous period for the PBGC," executive director Bradley Belt said in his resignation letter to President George W. Bush
>>

http://www.wbt.com/news/detail_wbt.cfm?article_id=26044

Bank of America Corp. has reached a deal with a Chinese bank to offer customers of both banks free ATM access while they're traveling abroad.

Beginning April 1, Bank of America customers in China can use debit or ATM cards for no charge at more than 11,000 foreign-enabled ATMs operated by China Construction Bank. The Chinese bank's cardholders will enjoy the same benefit when using the nearly 17,000 Bank of America ATMs in the United States.

``The successful operation of this project is a significant step for the strategic cooperation'' between the Chinese bank and Bank of America, China Construction Bank chairman Guo Shuqing said in a statement.

Bank of America last year paid $3 billion for a 9 percent stake in China Construction Bank, that nation's third-largest commercial bank with $522 billion in assets and $467 billion in deposits. It is China's largest mortgage lender and one of the country's four large state-controlled banks, but it has little experience with consumer lending.

...more...

hmmmm.... I don't use BoA - is that the same type of deal folks here in the USoA get?

4:20 pm : On the heels of yesterday's advance, the major averages spent the session in the red. Interest rate concerns continue to plague the market, and today's better than expected housing data underpinned them. A batch of disappointing news from the earnings front gave investors further reason to sell, and spiking energy prices did not help matters.

The FOMC is expected to raise interest rates again on Tuesday. Anxiety ahead of that - and ahead of the accompanying policy directive - has been mounting. For a market cognizant of the fact that the Fed will base its policy decisions on the economic data, today's Existing Home Sales report was not inspiring. The reading checked in at a 6.91 million annual rate, which was up from the prior month and well above analysts' projection. Essentially, the data, which is considered a lagging indicator, undercuts the argument that a slowing housing sector will give the Fed a reason to pause its tightening cycle. To that point, Treasuries sold off. For both markets, the housing data exacerbated the lingering interest rate uncertainty and the pre-FOMC nervousness. Bonds continue to occupy much of equity traders' attention, and rising yields helped keep buyers at bay. Rate-sensitive areas, particularly the Financial sector (-0.4%), did not fare well. Utilities (-0.2%) also declined.

Homebuilding was one area of the market that took the opposite cue. In the early going, KB Homes (KBH 67.82 +3.23) had been a sore spot. After Wednesday's bell, the company delivered better than expected profit and reaffirmed its full-year guidance. But, like many of its peers, KB Homes cautioned that softening in some markets is likely. That assertion appeared to be overshadowed, today, by the existing home sales report. Tomorrow, new home sales data will be reported. Across the board strength lifted the industry close to 4% and helped push the Discretionary sector (-0.1%) towards the unchanged mark. That area of the market was also supported by retailers, which demonstrated interesting resilience to interest rate worries and surging energy prices. Apparel stocks did well, and home improvement retail benefited from the housing data. General Motors (GM 22.00 -0.01) again occupied headlines, due to its 78% sale of GMACCH to a private equity consortium, but the stock had little effect on trade.

With respect to today's energy price action, natural gas led the advance. The commodity gained about 4% despite the fact that the Energy Department reported a less than expected inventory drawdown. Crude, meanwhile, closed near $64 per barrel. While equity trade has lately appeared to be less affected by energy price fluctuations, oil today broke out of its recent range. Ongoing geopolitical concerns continue to support energy prices, and reports that the Italian company Eni declared a "force majeure" in Nigeria added fuel to the fire. Additionally, crude's advance may have been a delayed reaction to yesterday's unexpected drop in supply. The price action coupled with a profit warning from YRC Worldwide (YRCW 38.56 -6.73) in challenging transportation stocks and taking Industrials 0.6% lower. On the bright side, the action sparked some buying action across the Energy sector. Its 1.1% gain was not enough to take the indices to positive turf, but it did help limit their decline. Metal commodities also rose today, and resulted in the Materials sector's (+0.2%) advance.

Further to the earnings front, downside guidance from Adobe Systems (ADBE 36.33 -0.29) weighed heavily upon trade. There were a few pockets of strength that helped offset its effect, but the sector still booked a 0.4% loss. Yahoo (YHOO 31.83 +1.08), following an analyst upgrade, and Jabil Circuit (JBL 42.75 +4.51), due to its upside guidance, were two of the brightest spots. Semiconductors had offered some leadership intra-day, mostly to Advanced Micro Device's (AMD 34.75 +0.38) credit, but the industry well-pared its gain and took some of the steam out of the sector. As a side note, AMD's rise appeared to have been the result of Dell's announced acquisition of Alienware - a high end PC maker that uses AMD chips. The Consumer Staples sector, despite better than expected earnings reports from General Mills (GIS 50.23 +0.25) and ConAgra (CAG 20.54 +0.28), also spent the session submerged. Upgraded Sysco (SYY 32.36 +0.88) shares were a separate source of support, but, like the broader market, the sector ultimately faced wide-spread selling that left it with a loss.DJ30 -47.14 NASDAQ -3.20 SP500 -3.37 NASDAQ Dec/Adv/Vol 1417/1604/2.00 bln NYSE Dec/Adv/Vol 1662/1579/1.45 bln