STOCK MARKET WATCH, Wednesday 28 April

Market Internals Vs. Price

Over the past few weeks we have had a rather peculiar development in the equity markets. All three major indices have moved sideways while remaining below resistance, but above support! From a price-only-based point of view, the action has been consistent with the type of price behavior that we see during consolidation periods, which precede successful break-outs. However during the same period, the internals have been more consistent with failed consolidations, which precede break-downs. Consequently, the end result has been a bifurcated and choppy market characterized by lack of follow-thru in either direction.

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The current pattern of the McClellan Volume Summation Indexes at point #3 looks very similar to the pattern at point #2 and at point #1. Point#1 marked the beginning of a horrendous decline, while point #2 marked the beginning of a spectacular rally. Even if we didn't bother to do any further analysis, the very fact that the current pattern is almost identical to a pattern that in the past preceded both a substantial decline and a substantial advance should be enough of a reason for rational investors to consider both outcomes and devise their investment and trading strategy accordingly.

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In addition, we have observed a rotation by institutional investors out of high beta stocks, and into low beta and more defensive issues such as health care, food, energy and even pharmaceuticals. In other words, investors are no longer exhibiting a robust preference to take on risk. In fact it's quite the opposite, as they have become more risk-averse. A robust appetite for risk is not only an essential element of every bull market, but also a sudden shift in the level of risk tolerance, which almost invariably results in above-average market declines.

In other words -in my view- the equity markets at the moment are not "firing on all cylinders." The price action exhibited by the indices is positive, but it is due to positive price action by a small number of stocks with high capitalization, which disproportionately affects the price of the index itself.

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

Forex News & Analysis

http://www.forexnews.com/NA/default.asp

The euro reached a one-week high of 1.1954 in late Tokyo trade, effectively ending a strict definition of a downtrend by rising above its previous high of 1.1940 and through trendline resistance from 1.2380 crossing at 1.1880 today. The move may mark the incipient signs of a reversal but would first need to overcome key Fibonacci resistance at 1.1955 to confirm. Hinting that the dollar rally may be losing steam was the greenback’s indifference to this week’s data showing a surprise jump in consumer confidence in April and record new home sales and surging existing home sales. Given that yields have also stalled near their one-year highs of 4.48% in the 10-year note, the dollar may have exhausted its yield play rally. A leveling off of yields could therefore lead to some profit taking in the dollar’s strong gains since mid-February.

No key data is due from the US or Canada today. Instead traders will look to Thursday’s revision of Q1 GDP, which is expected to show an annualized gain of 5%, above the preliminary estimate of 4.1%. Despite robust growth over the past three quarters, the Fed’s optimistic view on inflation is part of the Fed’s attempt to ease rates higher, which appears to be working as the dollar and yield rally has stabilized, while stocks chop higher, looking take out last month’s highs, but remain constrained by rate fears and valuation concerns.

EUR/USD

The euro rose to a session high of 1.1954, stopping right at the 61.8% retracement of the 1.2380-1.1760 decline. The euro has rallied 2 cents from Monday’s new 5-month low and trendline support at 1.17 is likely to hold in the near term. Yesterday we said that while it is still very close to call, the euro has indeed held above a trio of trendline support cited in last week’s article “Euro Finds Trio of Support.” The subsequent move through downtrend resistance at 1.1920 may be the preliminary indication of a larger relief rally in store to correct its 11.5 cent decline from February’s all time high of 1.2925. But it will take a move through cited resistance at 1.1954. Until then support is seen at 1.1850, which marks the 50% retracement level of the 1.1760-1.2925 rally, followed by Monday’s low of 1.1760 Only a move below here would target 1.1575, the 61.8% retracement of the 1.1760-1.2925 rally.

USD/JPY

The dollar held above support at 108.60 but was unable to overcome resistance at 109.80 after twice testing last week’s new one month high of 109.83. While the rise back above the 61.8% retracement of the 112.32 to 103.40 decline at 109 yen is a bullish development for the dollar we continue to warn that the dollar may come under pressure if EUR/USD were to rally from trendline support at 1.17, thus dragging the dollar lower in its wake. Resistance is seen at 109.80 followed by 112.35. Support is seen at 108.60, 107.50 and 106.50.

Their stocks are doing better than ever.

At last count - there were almost 900 military contractors associated with the Pentagon. Many of them make arms or armament components.

Or will everyone just move on?

Eight months ago any news out of Iraq was perceived as good with everything going as planned, even bumps in the road. The market reacted wildly negatively the last time the Marines saw substancial numbers of deaths in Falluja.

both this morning. :shrug:

Silver:
?s=FOREX_XAGUSDO&t=f&w=5&a=2&v=s

Gold:
?s=FOREX_XAUUSDO&t=f&w=5&a=2&v=s

I didn't realize I had as much power as the greenman. :-)

Seriously... any idea what's going on?

every once in a while - big moves up or down in short periods of time. I could put on my conspiracy theory hat and say price manipulation, but I'm not about to go there with you. :evilgrin:

"Notice that a 61.8% re-tracement of the rally that started in April of 2003 will take gold to 364.39. A 38.2% re-tracement of the entire bull move that started in February of 2001 will also take gold to 364.55. In addition, the 364.55 level represents "channel support." My point is this -- I believe that the 364-365 level represents very important support. In all likelihood it will be tested in the coming weeks and I would expect gold to bounce sharply from that level."

That would put the dollar right on the second support level I was talking about. He's just more optomistic than I am that it will "bounce" right off.

Notice that a 61.8% re-tracement of the rally that started in April of 2003 will take gold to 364.39. A 38.2% re-tracement of the entire bull move that started in February of 2001 will also take gold to 364.55. In addition, the 364.55 level represents "channel support." My point is this -- I believe that the 364-365 level represents very important support. In all likelihood it will be tested in the coming weeks and I would expect gold to bounce sharply from that level.

:shrug:

special time again.

Gold and silver down and the dollar up against both the Yen and Euro ... while the market open with sharp declines? Smells like intervention.

Just fell off another cliff to the $385/oz range.

That's what it looks like to me. Or somebody is paying Euoro/Yen premiums for gold. Or both.

probably the shorts trying to shake the longs out of the tree before the price starts to head back up on fight to quality due to geopolitical issues and the future de-hedging of Anglo's books.

If you don't believe in market manipulations and gold cartels, then it's probably going to be harder to come up with a reason.

:shrug:

Of course there's always the obvious... No cheating or manipulation necessary for the theory that Gold is simply overpriced and due for a correction. That just maybe a 50% run up in two years is about all one can expect without a substantial correction?

Or maybe that gold hasn't changed much on it's own and has actually been rising almost exclusively on the plunge in the dollar and that maybe THAT is about done?

The Dollar is up about 7.1% and Gold has fallen about 7.2%.

Today's movement is probably just bringing them in line.

consideration. I'll stick with the shorts shaking out the longs. B-)

Since January of 2002 to the high, Gold went up about 44% (give or take - I'm eyeballing it). In the same period of time the dollar fell to it's low (a drop of.... wait for it... 42%).

Sure, on any given day/week it's possible for the underlyig value of Gold to fluctuate a little, but if you've lived in Germany these last couple years and invested in Gold in Euros? You haven't made any money.

http://www.washingtonpost.com/wp-dyn/articles/A47866-2004Apr27.html

Federal bank regulators are preparing to impose on Riggs Bank what could be the largest civil penalty ever against a financial institution for violations of anti-money-laundering laws, sources familiar with the discussions between Riggs and government officials said yesterday.

The fines being contemplated by regulators could top $25 million, the sources said. The penalty will be imposed for what the bank acknowledges have been years-long deficiencies in complying with the Bank Secrecy Act, which requires financial institutions to report suspicious activities to federal authorities.

Riggs expects to report tomorrow that it earned a profit for the first quarter of 2004. But the bank is expected to caution investors that fines that could be imposed by regulators any day could wipe out profit for the year. The fines themselves are expected to be announced after the earnings report comes out.

Last year Riggs National Corp., the holding company that owns the bank, reported profit of $979,000. It has not earned more than $25 million in a year since 1999.

more...

http://www.washingtonpost.com/wp-dyn/articles/A47769-2004Apr27.html

Troubled mutual fund manager Janus Capital Group Inc. yesterday agreed to give up $226.2 million to settle state and federal charges that the Denver company helped favored clients profit at the expense of average investors.



Janus will pay $50 million in restitution and $50 million in civil penalties and will reduce fees by $125 million over five years as part of the deal. It will also turn over $1.2 million to Colorado authorities to be used for investor education initiatives.

The settlement with New York Attorney General Eliot L. Spitzer, Colorado Attorney General Ken Salazar and Colorado Securities Commissioner Fred J. Joseph is the latest in a series of setbacks for Janus, which controls about $145 billion in assets and is the nation's ninth-biggest fund company. The Securities and Exchange Commission also is taking part in the settlement, but the deal is still subject to the approval of the agency's five commissioners.

Janus, which cultivated a reputation in the 1990s as a go-to, technology-savvy investment adviser, suffered declines during the economic downturn and has lost investors as a result of the mutual fund scandal . Last week, chief executive Mark B. Whiston stepped aside after less than two years on the job, replaced by Chairman Steven L. Scheid. Outflows from the firm's stock funds have continued even as other mutual fund management companies have rebounded as a result of the recovery in the economy, analysts said.

more...

http://business.timesonline.co.uk/article/0,,9076-1090775,00.html

GLOBAL CROSSING, the US telecoms carrier, admitted yesterday that it had overstated its 2003 profits by up to $80 million (£45 million), just four months after emerging from Chapter 11 bankruptcy protection.

The shares plunged 22 per cent in the wake of the announcement, and Global Crossing admitted that worse could follow because its internal investigation is not yet complete.

Global Crossing, whose UK customers include a string of Whitehall departments and the National Lottery, said the problem came to light as it was preparing its first-quarter figures for 2004.

The company said in a statement that “management became concerned” that the company’s reported costs were lower than they should have been, revealing “a material weakness in its internal controls”.

The company, whose Chapter 11 restructuring was one of the biggest in US corporate history, did not suggest that the cost under-reporting was fraudulent, but the revelations are almost certain to attract the attention of the US Securities and Exchange Commission.

more...

9:00AM: S&P futures vs fair value: -3.9. Nasdaq futures vs fair value: -3.5. The stage remains set for a lower open, as futures indications fade to their lowest level of the morning. The market looks to extend its mostly sideways trading action in today's session, as participants continue to lack conviction in the face of Tuesday's FOMC meeting and tomorrow's GDP data.

8:35AM: S&P futures vs fair value: -2.8. Nasdaq futures vs fair value: -1.0. Futures indications continue to fade and point to a lower open for the cash market. Generally better than expected earnings reports and guidance remain insufficient to incite buying interest, as participants continue to exhibit hesitancy. There are no economic reports today, as the market awaits tomorrow's GDP and Initial Claims reports.

8:02AM: S&P futures vs fair value: -2.6. Nasdaq futures vs fair value: -1.0. The futures market is lower as the lack of conviction seen yesterday carries over into the pre-open session. Trade in the overseas markets is lackluster, with the European DAX down 0.7% and the Asian Nikkei down 0.3%. A CNBC report speculating that the U.S. may withdraw from Athens Olympics in order not to risk American lives ahead of the election brought geopolitical concerns center-stage.

http://www.kitco.com/ind/Field/apr272004.html

Talk of deflation has become popular once again. Richard Russell has mentioned it and several people have asked my opinion of a recent article by George Paulos and Sol Palha entitled “A Day Late and A Dollar Short”. It is a well-written, well-argued case for deflation (to be found at www.freebuck.com and www.lemetropolecafe.com).
The word “Deflation” conjures up visions of the 1929 Crash and the economic depression of the 1930’s, hence a well-written piece where the authors’ views are obviously sincerely held tends to strike an emotional response.

Deflationary talk is not new. It has been around every time the USA has had an economic recession. A very public proponent of a deflationary future is Robert Prechter who published his deflationary tome “How to Conquer the Crash” in 1995. His views are equally persuasive and also sincerely held. To this day he believes that deflation is about to strike.

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Deflation is a collapse of a debt pyramid when it becomes “excessive” and debtors cannot fulfil their debt obligations. This creates a self-feeding downward spiral of debt repudiation leading to recession or worse. The debts could be said to have been settled by the bankruptcy of the debtors.

A deflationary collapse requires two special factors to be present:
1. A strong or desirable currency that people are content to hold;
2. An inability by monetary authorities to create new money at will.

Those pre-conditions were present in the 1930’s when the convertibility of the dollar into gold ensured that the dollar was money that people could trust and were content to hold. The constraint of gold convertibility prevented the authorities from creating dollars at will and boosting Government spending.

more...

The article is "gold-buggy" but has some interesting charts.

http://www.freebuck.com/articles/dvanarts/040427dvanarts.htm

edit for html

Dow 10,407.25 -70.91 (-0.68%)
Nasdaq 2,012.91 -19.62 (-0.97%)
S&P 500 1,129.67 -8.48 (-0.75%)
10-yr Bond 4.415% +0.011
30-yr Bond 5.220% +0.010

NYSE Volume 187,747,000
Nasdaq Volume 282,334,000

9:40AM: In tune with futures expectations, the cash market is off to a lower open... Two Dow components reported earnings this morning: McDonald's (MCD 27.77 +0.55) checked in with in-line results and Boeing (BA 43.68 +0.13) with better than expected earnings... The earnings parade continues, with the bulk of the reports coming in above expectations, but failing to incite an earnings rally as participants remain hesitant in the face of macro developments... To that effect, the advance reading for the Q1 GDP will be reported tomorrow, while the FOMC will hold a meeting on Tuesday...

I cant believe the 226 MILLION fine for Janus, I wonder what they really deserve ? Has fidelity been fined for anything yet? Im thinking of moving my 401K to them.

also on the subject of Marvin Bush's Riggs Bank (from http://www.timnews.com )

911 - Marvin Bush's Riggs Bank to be fined by federal regulators .. CBS -For secret transactions with Saudi Arabia
http://cbs.marketwatch.com/news/story.asp?guid=%7B705F07F6%2DAEC4%2D41C6%2DB456%2DF62CBEC3B119%7D&siteid=mktw


SECRETS - Saudi Prince Bandar transfered money to 911 hijackers through Riggs Bank in DC .. Newsweek
Bank directed by Marvin Bush
http://www.msnbc.msn.com/id/4661093

Kinna like Prescott Bush's Union Banking Corp trading with the Nazi's.

...on its funds. But being locked in to their funds is somewhat restrictive. If you upgrade your account to a brokerage style account, to get more flexibility, the transaction fees are really a rip off.

I used to swear by Fidelity but now I want to get out and transfer all my assets to another service. It doesn't really matter as I'm almost entirely in cash anyway.

On edit,

Sorry, looks like I posted this in the wrong spot.

http://biz.yahoo.com/rm/040427/minerals_coins_2.html

The U.S. Mint has increased the price for collector proof sets and American Eagle coins between $2 and $6 to reflect higher costs for silver, zinc, nickel and copper. The price hike marks the first time since 1998 that the Mint has boosted prices for collectibles.

Copper prices have risen 76 percent, nickel 67 percent and zinc 55 percent since early 2003, according to Mint figures.

snip>
The price increase also reflected small adjustments for inflation and the addition of two commemorative nickels, Eskridge said.

Metals prices have surged to their highest levels in several years due to a weak dollar, shrinking inventories and a construction boom in China that has boosted demand.

Silver, the predominant metal used in commemorative coins, hit a near 17-year high earlier this month of $8.43 an ounce, has eased to $6.20/6.23 compared with $6.15/$6.18 in New York.

more...

http://cbs.marketwatch.com/news/story.asp?guid=%7B5156846C-B1C3-439A-AF7B-EEB86E95A8A8%7D&siteid=google&dist=google

I first reported on this phenomenon in a piece in February, when gold had also broken below $400. Subsequently, of course, gold bounced back, to a high of $432 on March 31.

Now we've returned to fun and games. Gold has come crashing down to test its 200-day moving average just below $390 Wednesday. Half that fall was in just 3 days last week.

Gold shares have fallen 20 percent in the same period. There is gloom and despondency everywhere.

And puzzlement. The return of measurable inflation at home -- mounting chaos and bloodshed in the Middle East -- shouldn't these be good for gold?

more...

other than oil and some other commodity prices, real estate, etc. And real estate is starting to come down.

Higher commodity prices and debt will take a bite out of consumer spending power. Also, isn't the money supply shrinking?

Maybe gold is the early indicator of deflation around the corner.

Real Estate Chart

One day there are reports that it is shrinking, another day it's expanding.

Do you happen to know of a good source for the money supply information?

I've used the charts here-
http://www.economagic.com/popular.htm

Here's a link to M2.

http://www.briefing.com/Silver/Calendars/EconomicReleases/m2.htm

M3, sometimes they bring up MZM.

Question for you, does this extra liquidity Greenspan guards so dearly from derivatives show up in any of these measures?

"liquidity" in general (to me) really just means a move from the higher measures (M3 say) to the ones that are closer to "cash" (like M1,M2). But since everything in the lower numbers shows up in the higher ones I would guess that it would eb an increase in M2 without a coresponding increase in M3.

All completely off the cuff.

but not enough to confirm the trend yet. Not my area of expertise. I guess they can't control both the supply and the cost of money, and since they are already controlling the cost of money (interest rate), it leaves the money supply free to seek it's own level.

This will be very interesting if the money supply starts dropping as economists are preaching to us that inflation is here. It would be almost too funny to watch them try to explain that, if it weren't scary at the same time.

http://www.bday.co.za/bday/content/direct/1,3523,1603170-6078-0,00.html

World number five gold miner Harmony (HAR) will look at restructuring Avgold's (AVG) hedge book at the minimum cost to shareholders, if the group buys out and delists Avgold, Harmony marketing director Ferdi Dippenaar said.

In the past, Harmony has aggressively restructured and closed out hedge books that it inherited when it acquired Randfontein Mines' South African operations and various mines in Australia respectively.

Harmony has a policy of non-hedging so as to get full exposure to the spot gold price.

The extent of the restructuring of the hedge book will depend on the dollar gold price, the rand/dollar exchange rate and the mark-to-market value of Avgold's hedge book, Dippenaar said.

more...

Dow 10,364.39 -113.77 (-1.09%)
Nasdaq 1,999.38 -33.15 (-1.63%)
S&P 500 1,125.10 -13.05 (-1.15%)
10-yr Bond 4.432% +0.028
30-yr Bond 5.237% +0.027

NYSE Volume 674,697,000
Nasdaq Volume 828,406,000

11:00AM: The Nasdaq is down 1.3%, having dipped below its 50-day simple moving average at 2008, inciting selling efforts in the broader market... The gold sector is among today's biggest laggards, with losses of 5.9%, as indicated by the XAU index, on concern of falling China demand after Premier Wen Jiabao said today that China needs "very forceful" measures to cool its fast-growing economy... The price of gold has fallen $13.40 to $385.70/oz...
Also contributing to the sector's decline are worse than expected earnings from Newmont Mining (NEM 38.80 -1.39), which reported Q1 EPS of $0.30 (consensus $0.34)... Phelps Dodge (PD 68.19 -0.69), for its part, is also down despite reporting blow-out earnings - please see Briefing.com's Earnings Briefing for more perspective...NYSE Adv/Dec 771/2106, Nasdaq Adv/Dec 695/2007


Now that explanation for gold's drop makes absolutely no sense to me at all :crazy:

http://www.forbes.com/markets/newswire/2004/04/28/rtr1350915.html

But his strongest comments were reserved for his own economy, which logged 9.7 percent growth in the first quarter of this year but faces resurgent inflation due to unchecked expansion in money supply, bank credit and fixed asset investment.

Counting out a series of problems on his fingers, Wen underscored the weaknesses underlying one of the world's fastest growing economies, problems which he said would prevent all but the most prudent steps in reforming the tightly held yuan currency.

"We need to take effective and very forceful measures to resolve those problems as soon as possible," Wen said.

China has restricted bank lending, singled out cement, steel and aluminum projects in a broad clampdown to stamp out excess development and, just on Wednesday, issued new land-use rules to rein in industrial growth.



COMEX gold falls under $390 as metals tumble
http://www.forbes.com/markets/newswire/2004/04/28/rtr1350902.html

NEW YORK, April 28 (Reuters) - COMEX gold fell to its lowest price since Nov 7 Wednesday morning, joining a broad metals shakeout caused by a rising dollar and concerns that Chinese demand could subside.

snip>

Dealers said metals were rocked by comments by Chinese Premier Wen Jiabao suggesting Beijing will take strong steps to cool its economy, which has been sucking in raw materials to feed a boom in construction and consumer spending.

http://www.gold-eagle.com/gold_digest_04/russell042704.html

I'm showing below a weekly chart of the Dollar Index. Question -- what are we looking at? Is this just another rally in a major downtrend? Maybe. But the Dollar Index is now pushing up and above against a second declining trendline. And the histograms at the bottom of the chart have turned up again. And I ask myself, "It this just another peak with the Dollar Index being halted by its long declining trendline? Or is this the beginning of an important reversal to the upside on the part of the dollar. As I write, it's too early to tell where we are with the dollar. But the chart gives me food for thought.

OK, what does all that I've written amount to? And what should we do about it -- if anything? First, all this is happening within the context of a primary bear market, a primary bear market that has been "contained," "held back," "thwarted," whatever you want to call it. For this reason I take what's happening very seriously. I don't like to fool around with angry, caged bears.

If interest rates break out on the upside, if the dollar continues to climb -- it's going to hit everything. It's going to cause an unwinding of the carry-trade. And it could trigger a move, even a rush -- to liquidity. It's going to set off a move to get out of all "things" and into cash. And cash is what the mass of Americans don't have. The real cash, the real liquidity, is owned and held by a very small percentage of Americans. What the great mass of Americans have is things: houses, cars, junk -- and lots of debt.

Now here's the hard part for me and my subscribers. If what I see above comes into being, there's a good chance that we could see pressure on gold shares. Gold shares are really a "call" on a higher price for gold. Sure, gold is real money, sure gold will triumph in the end, but for now the investment world sees gold as a commodity, like aluminum or wheat. They don't see gold as the only real money. So we could see pressure on gold, but more probably on the gold shares. I don't know for certain that we'll see pressure on gold, but it could happen. We've certainly seen pressure recently -- although this could simply be corrective action.

After a quick peek at the numbers over lunch and my appetite goes weak.

12:19

Dow 10,376.02 -102.14 (-0.97%)
Nasdaq 2,003.18 -29.35 (-1.44%)
S&P 500 1,126.82 -11.33 (-1.00%)
10-Yr Bond 4.432% +0.028

U.S. stocks consolidate with deep losses

NEW YORK (CBS.MW) -- Mid-session losses gripped Wall Street on Wednesday as fears of an economic slowdown in China compounded early selling spawned by news of financial turmoil at Nortel Networks and Comcast's withdrawal of its bid to acquire Walt Disney.

Blue-chip losses hit triple digits, and the Nasdaq at one point slipped below 2,000 for the first time in nearly a week.

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Alcoa (NYSE:AA - News) was the Dow's biggest decliner, shedding 4 percent as metals stocks took a hit on concerns that metals demand from China may suffer from new government rules. On the New York Mercantile Exchange, the June gold futures contract fell $13.30 to trade at $385.30 an ounce.

story

So, what would you make of the big move down in gold?
Pretty interesting, isn't it?

It looks like someone is angling for a bargain on gold. The money does not seem to be going into stocks or bonds either. Is this an across-the-board liquidation?

http://biz.yahoo.com/cbsm-top/040428/ad9e942301723d219ebae2ff230d2216_1.html

NEW YORK (CBS.MW) - Wall Street's losses mid-day Wednesday as fears of an economic slowdown in China compounded early selling on news of financial turmoil at Nortel Networks and Comcast's withdrawal of its bid for Walt Disney.

snip>
The Dow Jones Industrial Average (^DJI - News) was last down 100 points, or 1 percent, to 10,377 after tumbling as lo2 as 10,357.

The Nasdaq Composite Index (NasdaqSC:^IXIC - News) slumped 31 points, or 1.5 percent, to 2,001 and the S&P 500 (CBOE:^SPX - News) shed 12 points, or 1.1 percent, to 1,126.

snip>
Bryan Piskorowski, market analyst at Wachovia Securities, said fears of a slowdown in China's economy is hurting stocks.

"It's been running a full head of steam when you look at the demand growth stemming from China over the past 18 months, two years...I think the market is starting to come to grips with the fact that you can't grow at 7, 8, 9 percent for eternity."

more...

http://www.guardian.co.uk/business/story/0,3604,1205235,00.html

Royal Dutch Shell, the embattled oil giant, said today it will cut up to 2,800 jobs as it relocates its global technology division.
IT operations, now concentrated in the UK, the Netherlands and the US, are to be shifted to India or Malaysia, where Shell already employs about 1,000 people in a technology support centre.

The company, currently under investigation in the UK and the US for overstating its oil reserves, did not disclose where the jobs would be cut, but it employs around 1,000 people in its British IT operations in the north-west and in London. The group expects the cuts to save $850m (£475.6m).

Shell said the move was not just a cost-cutting exercise but was designed to improve efficiency and provide better services. The move will hardly boost morale at Shell as it undergoes one of the worst crises in its history.

more...

http://quotes.ino.com/chart/?s=NYBOT_DXY0&v=s

Last trade 91.17 Change +0.76 (+0.84%)

Settle 90.41 Settle Time 23:36

Open 90.41 Previous Close 90.41

High 91.22 Low 90.23


Forex - Dollar rises as market prepares for strong US GDP data Thursday
http://www.fxstreet.com/nou/noticies/afx/noticia.asp?pv_noticia=1083169503-9e32d306-44773

LONDON (AFX) - The dollar moved higher, rising past key levels against the the euro, yen and the pound as participants took advantage of a quiet session to prepare for a strong US GDP growth figure tomorrow

This sort of "squaring up for a strong GDP number" saw the US currency charge higher, said Kamal Sharma, strategist at Dresdner Bank

Notably, the euro slipped below 1.1850 usd while the pound fell under 1.78 usd. The dollar also rose past 110 yen briefly. Dresdner for one expects US GDP to have risen by an annualised 5 pct in the first quarter, putting the official rubber stamp on US economic recovery

But the data will be only the first of several hurdles for the dollar. The labour market report next Friday and the US Fed's statement after its rate decision on Tuesday will be pivotal. With these hurdles remaining, markets will be wary of taking bets against the dollar even if Thursday's GDP data come belowe expectations. Elsewhere, the pound had little to cheer about despite a hint from Marian Bell, a member of the Bank of England's interest rate setting Monetary Policy Committee, that UK rates will have to rise. She highlighted that the current low rate of inflation as measured by the CPI index would not affect the MPC's rate decision as it targets inflation over the coming two years

At last count, the CPI stood at 1.1 pct in March, well short of the 2.0 pct official target set by the government. But markets have already priced in a quarter point hike in May

more...


NY FX:Dlr Tone Firm After Gold Dips Below Key $387.50 Support
http://www.fxstreet.com/nou/noticies/afx/noticia.asp?pv_noticia=200404281205MKTNEWS_MAINWIRE_BC46_6444

NEW YORK, April 28 (MktNews) - A sharp dip in gold below key technical support at $387.50/$389.00, driven by earlier declines in other commodity prices, helped to keep a dollar buy trend alive at midday Wednesday, traders said.

Earlier, copper, aluminum and silver declined sharply, driven by fears of declining Chinese demand, which was sparked by a report quoting Chinese Premier Wen Jiabao stating that China needed "forceful measures" to cool its economy.

While expected strong Chinese demand has helped to underpin various industrial metals markets this year, and therefore was ultimately behind part of the declines being seen in these metals, analysts maintained that the market was overly long and unwinds were to be expected.

snip>
Gold sales, driven by stop-loss selling as well as large fund selling, pushed the precious metal to lows near $384.65/oz.

Spot gold held at $385.00/oz. at 11:57 a.m. EDT, off from overnight highs near $398.40.

Tom Fitzpatrick, technical analyst at Citigroup, warned however that a daily close below $387.50/$388.50 will be needed to make sure the days declines are not a "one day wonder".

"You really need a daily close below that level to classify it as a break," he said.

Looks like we have a break.

http://quote.bloomberg.com/apps/news?pid=10000103&sid=ar0TnQKYFZjQ&refer=us

April 28 (Bloomberg) -- U.S. Treasuries fell before a report tomorrow is forecast to show economic growth accelerated in the first quarter, fueling speculation the Federal Reserve will lift its target interest rate as soon as September.

The decline in prices comes as the Treasury Department sold $26 billion of two-year notes. Investors are hesitant to buy Treasuries on concern the supply of government debt is increasing at a time when the economy is growing and inflation may be poised to quicken.

``People continue to view strength as an opportunity to sell,'' said James Caron, a fixed-income strategist in New York at Merrill Lynch & Co., the largest securities firm by capital. ``The trend has been for better-than-expected data, so there's every reason in the world to believe this data will fall within that trend.''

snip>
Demand for the Treasury's newest two-year note was the weakest since January, judging by the bid-to-cover ratio. There were $2.11 of bids for every dollar sold, compared with $2.18 at the government's most recent sale on March 24. For the past 12 sales, the bid-to-cover ratio, which gauges demand by comparing the volume of bids with the amount of securities offered for sale, averaged $2.

So-called indirect bidders, which include foreign central banks such as the Bank of Japan, bought 42.3 percent of the notes today, compared with 45.2 percent at the previous auction. Japan, the largest overseas holder of Treasuries, has put some of the proceeds from yen sales into U.S. government debt. Japan bought $30.3 billion of Treasury notes in February, up from $26.6 billion in January

The U.S. is selling debt to finance a widening budget deficit, which has already reached $299.5 billion halfway through the fiscal year that ends on Sept. 30. The government estimates it will reach $521 billion this fiscal year.

Dow 10,342.60 -135.56 (-1.29%)
Nasdaq 1,989.54 -42.99 (-2.12%)
S&P 500 1,122.41 -15.74 (-1.38%)
10-yr Bond 4.467% +0.063
30-yr Bond 5.263% +0.053

NYSE Volume 1,860,147,000
Nasdaq Volume 2,029,765,000

Close: The market opened lower and never looked back as the major averages extended their pullback through the entirety of the day and closed near their respective session lows... Ongoing concerns regarding rising interest rates played their part in the decline, like they have through most of the past month, while several other factors also contributed to the negative bias... Specifically, the Nasdaq's decline below its 50-day simple moving average at 2008 and below the psychologically significant 2000 mark undermined the broader market...
Separately, comments by China's Premier Wen Jiabao indicating that the country needs "very forceful" measures to cool its fast-growing economy led to a sell-off in the gold, aluminum, coal, steel, and metal-mining sectors... Another round of earnings reports came and went without inciting a rally from the market, despite the strong results, highlighted be generally better than expected earnings growth and upbeat guidance... Accordingly, leadership to the upside was limited as the bulk of the sectors ended the session in the red...

Laggards of note included the influential hardware, networking, internet, telecom, biotech, drug, banking, broker/dealer, insurance, oil services, and transportation groups - the list goes on.... Elsewhere, the bond market closed with losses across the yield curve and the 10-year note down 26/32, bringing its yield up to 4.49% ahead of tomorrow's Q1 GDP report...

They've been mis quoting their earnings and canned their President, CEO, accounting staff - the janitors are probably soon to follow.