STOCK MARKET WATCH, WEDNESDAY AUGUST 27.....(#1)

Surprise, Surprise, Surprise…

Stock indexes in the U.S. today snapped back from a weak start this morning on very light trading. Positive economic reports in the morning gave traders very little reason to buy up the indexes and led the Dow Jones to a 84 point loss by mid-morning. However, at about 2pm EDT traders began buying up index futures leading to what most analysts revealed as a short-covering frenzy in advance of the Labor Day Weekend. One note of interest indicated that over the past six years, the week going into Labor Day has been negative for the markets. However, the month of September has typically started off strong before slumping later in the month.

Much of the recent talks of the coming economic recovery and the markets expectations of such have overshadowed concerns of the coming months and the historical effects to the markets during this time of year. With the market significantly overvalued again, unemployment over 6%, rising interest rates and a federal budget deficit exceeding $400 billion, the markets have poised themselves for another fall.

more...

"With the market significantly overvalued again, unemployment over 6%, rising interest rates and a federal budget deficit exceeding $400 billion, the markets have poised themselves for another fall."

With this clip from your first post I would like to add that L.Paul Bremmer of the Interim Iraqi Authority( or what ever his title is)has stated that they need more money. Of the 1 billion in frozen Iraqi assets, all but 10 million have been spent. What is hindreing them in the financial efforts is the lack of exported Iraqi oil that was being counted on. It was expected that these funds would last at least until October. It is felt they will be gone before September. Bush is then going to be forced to ask congeress for additional funds. This was in an LBN thread yesterday, sorry I don't have the link. With this news, I got my $1.75 ready, will there be a slower than usual Sept on the markets or even a return to the 7,500 mark that the market went to on two occasions since Bush took office? I have to also ask, with this news coming out of Iraq on the oil do you feel that there will be note worthy activity in the oil market?
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found the thread in the LBN:

http://www.nytimes.com/reuters/politics/politics-iraq-usa-bremer.html
August 27, 2003
W.Post: Bremer Iraq Effort to Cost Tens of Billions
By REUTERS



Filed at 0:57 a.m. ET
WASHINGTON (Reuters) - Iraq will need tens of billions of dollars in contributions from overseas in the next year to fund the reconstruction effort, the top U.S. civil administrator in Iraq, Paul Bremer, said in an interview published on Wednesday.
Bremer told The Washington Post that Iraqi revenue would not be enough to cover the bill for economic needs that he described as "almost impossible to exaggerate."Explaining the huge cost of the project, Bremer said it would cost $2 billion just to meet current electrical demand and an estimated $16 billion over four years to deliver clean water to all Iraqis.The figures, which must be added to the $4 billion the Pentagon spends each month on military operations in Iraq, offer the latest evidence that the price of the Iraqi occupation is growing substantially, The Post reported.
Quick revenues from Iraq's vast oil resources have failed to materialize because of sabotage and looting.

Bremer told the newspaper he hoped to return Iraqi oil production to prewar levels by October 2004. But he noted that even when deliveries return to 2002 levels, the industry would not produce enough revenue to cover the cost of reconstruction.

<snip>

He also told the newspaper that it would take years and countless billions of dollars to get Iraq functioning again. ..Bush said it would require "substantial" time ...would try to persuade more countries to join in ....Bremer strongly questioned the wisdom of giving significant responsibility to the United Nations."What exactly is it that happens on the ground that makes things better if the U.N. is in charge of reconstruction?" he asked.
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I am a bit late on this one, but I read this thread also and I enjoy it. You all are doing good work.

I was paying attention to gasoline futures last week. What was not surprising, but possibly quite prophetic, was the rise in prices. The trend in commodities futures dictates that trading prices today will be reflected at the pump (in this case) three months from now.

But then, we ARE talking about gasoline prices. Any excuse to raise prices will be used to inch those prices up in the immediate term. However three months from now expect a price shock.

Consumer confidence? I don't know how this rise in gasoline prices will affect this economic yardstick. More important will be the other fossil fuel prices - especially natural gas. Since these fuels all basically come from the same place it will be interesting tonote how consumer confidence will faire in November and December when retailers are gearing up for the holiday shopping season.

As I look at my calendar, Thanksgiving will land on November 27th. Christmas arrives exactly five weeks later. It dos make me wonder how this year will compare to last year's truncated shopping season that sank some retailers. Travel during this time may be prohibitively expensive for some. Shipping costs may have an untoward effect on the holiday season's commercial aspects.

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Today's forecast:

The market was pistol-whipped with good fortune yesterday. As I read the results of yesterday's unexpected rally, a weird analogy comes to mind. The turn of events was like finding a C-note after one falls down and earns a goose egg on the noggin.

So I expect temerity in the markets. The federal deficit will be on people's minds as it has ben revised upward from the original $350 billion. Mortgage applications are slowing down (not good); Freddie Mac is back in the news (also not good); Intel's drag on the tech sector will still be in play. The lack of information in today's newspapers will lead to wary speculation.

So I forecast and across the board loss for the markets. The losses will be modest.

Remember: my opinion and $1.75 will buy you a cup of coffee.

EDIT: corrected date for Thanksgiving

The local coffee house is indirectly making a killing off of you.

where do you find coffee for only $1.75?

A tall coffee-o-the-day is just $1.75 here.

It this a recent trend or has it always been true?

Radfringe noted these last year--I think they have been around for a long time. There are several reasons, depending on the market conditions.

if the market has been falling for several days you'll see bears buying to cover the short selling they did earlier (for those who don't know the lingo--investors who promise to sell stocks for a set price, but don't deliver until later. When the stock prices fall, they buy the stocks at that lower price for delivery. They get paid higher for what they bought lower. If the prices go up, tho, they're screwed).

You'll also see buyers who think that the market has bottomed and buy at "bargain prices". In either case, the buyers think the markets are about to head back up.

Sometimes, however, there are big investors who try to push stock prices back up when they "fall too much."

Requests for home loans fall 13%, sinking to lowest level since June 2002
NEW YORK (Reuters) - The number of applications Americans filed for mortgage loans fell last week to the lowest level in 13 months on a steep drop in refinancing requests, an industry survey showed.

The Mortgage Bankers Association of America said Wednesday its seasonally adjusted gauge of mortgage requests fell to 638.6 for the week ended Aug. 22, down 13.3 percent from the previous week's 736.7
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"the likely final chapter of the refinancing boom"

NEW YORK (Reuters) - U.S. stocks were set to open near unchanged on Wednesday as investors prepared for a quiet day heading toward the Labor Day holiday weekend, with no major economic data or company news expected.

Investors are now focusing on Thursday's gross domestic product and jobless numbers, which will give the latest snapshot on the U.S. economy's slow recovery.

"The market is basically going to be in a holding pattern today waiting for tomorrow's GDP data and initial jobless claims," said Bill Strazzullo, market strategist with State Street Corp. "The market needs a catalyst to break out of this consolidation mode."

story

Storms swept thru here earlier, but I doubt there will be much "storm" on Wall Street today. Not until the summer vacations are over for the traders...

Well I am late in the action--big orthodontist appt this morn for my teen-aged daughter. Appliance out-full braces in! So look for a boost in that sector. ;-)

After skimming all the fab stuff you guys posted this morn I've got a forecast for ya but Ozy put it more eloquently, haha.

BTW, Ozy, love the toon! Good one. Course you always post good ones.

The markets are down and with the news Maeve posted about housing and the wrap-up stating the obvious, stocks poised for fall, well what is there to say but batton down the hatches and prepare for the storm.

Gas in my northern Michigan region $1.88 a gallon. Ouch. You can bet my little Honda Civic is the vehicle we're using the most.

10:10 and we are here:

Dow 9,319.26 -21.19 (-0.23%)
Nasdaq 1,766.39 -4.26 (-0.24%)
S&P 500 994.09 -2.64 (-0.26%)
10-Yr Bond 4.500% +0.014

More later--
Julie

Check out the chart in Ozy's original post this morn! Gold's up over $5! What does that tell you?

Julie

Looks like someone is concerned about long-term stability.

Good morning all!

Today's reading is really interesting. It is ZENITH changing to REPEATING. I just HAVE to quote this changing line from Zenith, "Incompetance is at its zenith. Be patient." !!!!!!!
I love it! That just HAS to be about Chimpy & Co.
The part that scares me is that it is followed by REPEATING. Does this mean we can expect this incompetance to continue???? And possibly cheat its way into another term? I'm way too scared to ask Ching about the election. I'll leave that to braver souls than I.

I'm predicting a down day.

"Incompetance is at its zenith. Be patient."

Truer words were never spoken! Good to see ya checkin' in with the reading Conventina! :hi:

Julie

We had a nice little buy-on-the-dip bounce, with a bit of a fall-off thereafter. Nothing serious going on as far as I can tell.

Dow 9,325.15 -15.30 (-0.16%)
Nasdaq 1,773.75 +3.10 (+0.18%)
S&P 500 995.76 -0.97 (-0.10%)
10-Yr Bond 4.513% +0.027

Dow 9,322.07 -18.38 (-0.20%)
Nasdaq 1,774.00 +3.35 (+0.19%)
S&P 500 995.43 -1.30 (-0.13%)
10-Yr Bond 4.521% +0.035


12:23

It looks like gold is still climbing. You're right Ozy *somebody's* concerned. Like anyone with a clue. haha

Julie

has no impact on the market. Maybe it is only that I have never watched the markets closely until the last year or so, but there seems to be a bit of a disconnect between investor behavior and economic news.

Gotta post quick while I'm eating lunch. ;-)

Dow 9,335.75 -4.70 (-0.05%)
Nasdaq 1,777.97 +7.32 (+0.41%)
S&P 500 997.01 +0.28 (+0.03%)
10-Yr Bond 4.524% +0.038

Yahoo words:

"1:00PM: More of the same as the major averages are drifting mostly sideways... Running into the long Labor Day weekend, volume is relatively light with 510 mln and 700 mln shares traded on the NYSE and the Nasdaq, respectively... Breadth figures are mildly favorable today as advancers are outpacing decliners by a slight degree on both exchanges and up volume is leading down volume by a roughly 3-to-2 margin on the NYSE and a 2-to-1 margin on the Nasdaq..."

Dow 9,331.40 -9.05 (-0.10%)
Nasdaq 1,778.97 +8.32 (+0.47%)
S&P 500 996.40 -0.33 (-0.03%)
10-Yr Bond 4.539% +0.053

NEW YORK, Aug 27 (Reuters) - Treasury prices extended early losses on Wednesday after an auction of new two-year paper drew only tepid demand at a time when the supply of government debt is ballooning.

The $25 billion of notes fetched a yield of 2.04 percent having steadily climbed from 1.97 percent in when-issued trading this morning. The sale drew bids for only 1.73 times the amount on offer, just below the 1.80 average of the last three auctions.

Traders had hoped that with two-year yields more than 100 basis points above the Fed funds rate, the sale would have drawn better demand.

That in turn stirred worries about the likely reception for the more than $50 billion of two-, five- and 10-year notes Treasury plans to sell next month.

"It looks like foreign central banks were reluctant to show up for this sale," noted Michael Cloherty, a fixed-income strategist at CSFB.

"Basically the Street's been left with around $2 billion of paper more than if the central banks had bid as aggressively as in the last three auctions," he added

More at:
http://biz.yahoo.com/rf/030827/markets_bonds_5.html

sorry if this is the wrong place to post this article, but this article was the first time I heard that we were peddling bonds again today. Thought the market watchers here might be interested. Looks as if we are not doing a good job luring in the foreign suckers..

Bonds are another market and some of us keep an eye on them--we've even started posting the 10-Yr yields.

Gee, no one wants to loan Unka Sam money, huh?

It's close...the Nasdaq has been where the action was today, both in number movement and volume. Tomorrow has a few things on the economic calendar, so there might actually be some NEWS for us to report! :eyes:

And the numbers--ooo, red at the end!

Dow 9,333.79 -6.66 (-0.07%)
Nasdaq 1,782.14 +11.49 (+0.65%)
S&P 500 996.81 +0.08 (+0.01%)
10-Yr Bond 4.536% +0.050

Obviously it has everything to do with those missing Ten Commandments in Alabama.

S&P 500 996.79 0.06 (+0.01%) - This one finally settled down to the tiny fractionals.

I had thought the same thing when I saw Dick Cheney's sacred numbers as the close.

You think we should have left that graven image, that "golden calf", in place?? :evilgrin:
Nah!

I find it very curious that Bond buyers are becoming wary of lending our government any more money and that gold is becoming more valuable.

Take, for example, today's figures:
DJIA 9,333.79 -6.66 (-0.07%)
Nasdaq 1,782.14 +11.49 (+0.65%)
S&P 500 996.79 +0.06 (+0.01%)
10-year bond 4.54% +0.05 (+1.11%)
Gold future 373.70 -0.40 (-0.11%)

Futures in gold yesterday were $365.40 (five dollars lower than today). So we have an influx of investment in the gold market, the stock market is stagnant and by some estimates (whom I trust) overvalued; while the bond market is short on buyers. Hmmmmm.

the economy is definitely growing, and that the bond and gold figures are very telling. The sale of bonds are what will hold the US afloat and with fewer and fewer buyers from both the foreign and domestic front, it doesn't bode well, imo.

To meet burgeoning funding needs the Treasury is set to start monthly five-year auctions in September as well as reopening this month's 10-year issue.

All together, more than $50 billion of new paper could come to market next month making it equivalent to a quarterly refunding in all but name.

Something big and bad is coming here, but there is only one article, the one in Yahoo, that is even talking about it. Wonder how they are going to be able to keep this out of the spin in September.

all those nasty connections with the Bushies and those dead bodies...

We need an occasional reminder of this Barrick-Bush connection. Since you bring up the item, I wonder how their stock has performed over the past few days.