Stocks Surged Yet Fell Back On Inflation Report
Wednesday, 14. May 2008, 17:44:11
Wall Street surged but pulled back on the CPI report.
The Labor Department reported that consumer prices advanced 0.2 percent in April after rising 0.3 percent in March; the reported decline in prices comes at a time when America is experiencing the largest jump in food prices in 18 years.
Wall Street is always concerned that higher food and energy costs are cutting into consumers' ability to spend; any pullback would be an unnerving prospect for investors because consumer spending accounts for about two-thirds of U.S. economic activity.
Stocks surged early in the day; but then tumbled to close basically unchanged; most market participants believe as HousingPanic does, that it's hilarious to believe the Gov's inflation report which showed nearly 0% inflation.
Some stocks fell on disappointing earnings
Deere & Co, DE, said its fiscal second-quarter profit rose 22 percent as higher crop prices drove global demand for its farm equipment. But the company said rising costs of raw materials could eat into its profits in the coming months. Deere fell 10% to 81.25
Jack in the Box, JBX, fell 10 percent, to $24.87 after the fast food chain said sales at restaurants open at least a year fell short of forecasts for the fiscal second quarter. The company lowered its sales target for the third quarter.
A number of stocks rose to all time highs
Restarant, YUM,
Computer, IBM,
Nasdaq, Research in Motion, RIMM,
Nasdaq, Priceline, PCLN,
Irrigation eauipment, Vamont Industries, VMI,
Apparel, HBI,
Defense and Aerospace, HON
Consumer Goods Containers, BLL,
Industrial Gases, PX,
Industrial, AME,
Industrial, SNA,
Industrial, KEX,
Retail, GYMB,
Retail, ROST,
Solar, FSLR First Solar has a PE of 122 and it manifested a doji today at $307.
Transportation, CSX,
Transportation, R,
Utilities, MAM,
Computer Storage, WDC,
Most ETFs were up this week; here is a representative sample
Retail, XRT, up 4.8%
Consumer Discretionary, XLY, up 3.5%
REITS, RWR, up 3.5%
Small Cap Value, RZV, up 3.0%
Russell 2000, IWM, up 2.7%
Semiconductors, XSD, up 2.4%
Home Construction, ITB, up 2.0%
Water Infrastructure, FIW, up 2.5%
Telecom, IYZ, up 2.1%
Nasdaq, QQQQ, up 1.9%
Brazil, EWZ, up 1.5%
Financial, IYF, up 1.2%
Energy, XLE, unchanged
Reit Mortgages, REM, down 1.1%
Market summary charts
US Dollar, $USD, closed at 73.35.
US Bond, $USB, fell to its 200 day moving average confirming that a run on the US Treasuries is underway.
30 Year US Government Bond Fund, BTTRX.
Interest Rate on the 30 Year US Treasury Bond, $TNX, has popped through 200 day moving average.
EUR/JPY, FXE:FXY rose to 1.630.
Overall US Stock Market, VTI, closed at $140 -- at the middle of a 'broadening top pattern' going back to going back to January 29, 2007; daily chart shows that the stock market is unable to rise above its 120 day moving average.
CRB, $CRB, fell to $422.
West Texas Intermediate Crude, $WTIC, closed unchanged at $125.50.
Gold, $GOLD, fell to $860.
Volatility, $VIX, closed basically unchanged at 17.66.
The Fed's actions and charts are truly scarry
Overall, little has changed from yesterday; I am terrified by the Fed's chart showing that over $100 Billion of liquidity has been transferred out of the Federal Reserve's vaults as this evidences that the banks are insolvent, and that the investment bankers are "zombie corporations" -- soulless, capital-eating monsters.
The Financial Ninja relates regarding the Federal Reserves facilities of TAF, TSLF And PDCF that:
An interesting chart was present by Dr. Janet Yellen this morning showing the Fed's balance sheet; this graph shows that about half the Fed's U.S. Treasuries have been committed to fight the liquidity crisis.
The Fed has basically traded in high quality instruments, US treasuries, for low quality instruments that the market doesn’t want at all or is pricing at levels deemed unacceptable by those market participants still denying reality.
The Fed has committed half of its $800 billion balance sheet to battle the RESIDENTIAL real estate bubble implosion. The COMMERCIAL real estate bubble implosion has yet to get well underway. Revolving credit, such as credit card debt has yet to implode as well. Job losses have yet to accelerate. The recession has yet to gather steam.
He reminds that The Fed Is Almost Out Of Ammo, Citigroup and UBS Too.
Total Borrowings of Depository Institutions (Chart: BORROW) are fast approaching $150 billion. This does not include the effect of the $50 billion increase in the TAF limit to $150 billion.
This has already pushed Non-Borrowed Reserves (Chart: BOGNONBR) to a NEGATIVE $100 billion. This is likely just to get worse as the balance sheets of financial institutions continue to deteriorate.
The balance sheets of almost all financial institutions, whether they be depository institutions or prime brokers WILL DETERIORATE further. They have to. The vast majority of their balance sheets are now in the Level 2 or Level 3 asset buckets.
As I said in Bulltrap: ABCP, and Level 3 Bombs, I can’t imagine that these assets are currently being undervalued or even conservatively valued.
That just NOT how these fellows roll. This is Wall Street man! Privatize the profits, and socialize the losses!"
And I'm even more terrifid by yesterday's Craig Torres and Steve Matthews report in Bloomberg that Bernanke Stands Ready To Boost Loans to Banks as Needed: we are going from bad to worse!
Federal Reserve Chairman Ben S. Bernanke said financial markets remain unsettled and the central bank will increase its auctions of cash to banks as needed.
While markets have improved, they remain ``far from normal,'' Bernanke said today in a speech to an Atlanta Fed conference at Sea Island, Georgia. ``We stand ready to increase the size of the auctions if further warranted by financial developments.''
Bernanke's comments contrast with those by Treasury Secretary Henry Paulson and Wall Street leaders including Vikram Pandit, chief executive officer of Citigroup Inc., who say the worst of the credit crisis is over. The Fed chief said it will take ``some time'' for financial firms to resolve the crisis by raising new capital and strengthening their management of risk.
Investment Application
Given today's failed rally, it's 'lock and load' with a broad based short selling strategy; or even better yet, a 'dollar cost average buy' of gold at BullionVault.com.
Here is one database of stocks, from which I suggest that one sell DRYS at 99.04 as it manifested a shooting star.
And here is yet even another database of stocks I recommend short selling; one of its stocks I recommend selling is Apple, AAPL, as it manifested a bearish engulfing candlestick.
Off all the short selling opportunities that exist today, I most definitely recommend the semiconductors, as these are going to move very quickly, greatly rewarding those who are short.
And I present these 200% ETFs for short selling and these 100% ETFs for short selling as well.
The Labor Department reported that consumer prices advanced 0.2 percent in April after rising 0.3 percent in March; the reported decline in prices comes at a time when America is experiencing the largest jump in food prices in 18 years.
Wall Street is always concerned that higher food and energy costs are cutting into consumers' ability to spend; any pullback would be an unnerving prospect for investors because consumer spending accounts for about two-thirds of U.S. economic activity.
Stocks surged early in the day; but then tumbled to close basically unchanged; most market participants believe as HousingPanic does, that it's hilarious to believe the Gov's inflation report which showed nearly 0% inflation.
Some stocks fell on disappointing earnings
Deere & Co, DE, said its fiscal second-quarter profit rose 22 percent as higher crop prices drove global demand for its farm equipment. But the company said rising costs of raw materials could eat into its profits in the coming months. Deere fell 10% to 81.25
Jack in the Box, JBX, fell 10 percent, to $24.87 after the fast food chain said sales at restaurants open at least a year fell short of forecasts for the fiscal second quarter. The company lowered its sales target for the third quarter.
A number of stocks rose to all time highs
Restarant, YUM,
Computer, IBM,
Nasdaq, Research in Motion, RIMM,
Nasdaq, Priceline, PCLN,
Irrigation eauipment, Vamont Industries, VMI,
Apparel, HBI,
Defense and Aerospace, HON
Consumer Goods Containers, BLL,
Industrial Gases, PX,
Industrial, AME,
Industrial, SNA,
Industrial, KEX,
Retail, GYMB,
Retail, ROST,
Solar, FSLR First Solar has a PE of 122 and it manifested a doji today at $307.
Transportation, CSX,
Transportation, R,
Utilities, MAM,
Computer Storage, WDC,
Most ETFs were up this week; here is a representative sample
Retail, XRT, up 4.8%
Consumer Discretionary, XLY, up 3.5%
REITS, RWR, up 3.5%
Small Cap Value, RZV, up 3.0%
Russell 2000, IWM, up 2.7%
Semiconductors, XSD, up 2.4%
Home Construction, ITB, up 2.0%
Water Infrastructure, FIW, up 2.5%
Telecom, IYZ, up 2.1%
Nasdaq, QQQQ, up 1.9%
Brazil, EWZ, up 1.5%
Financial, IYF, up 1.2%
Energy, XLE, unchanged
Reit Mortgages, REM, down 1.1%
Market summary charts
US Dollar, $USD, closed at 73.35.
US Bond, $USB, fell to its 200 day moving average confirming that a run on the US Treasuries is underway.
30 Year US Government Bond Fund, BTTRX.
Interest Rate on the 30 Year US Treasury Bond, $TNX, has popped through 200 day moving average.
EUR/JPY, FXE:FXY rose to 1.630.
Overall US Stock Market, VTI, closed at $140 -- at the middle of a 'broadening top pattern' going back to going back to January 29, 2007; daily chart shows that the stock market is unable to rise above its 120 day moving average.
CRB, $CRB, fell to $422.
West Texas Intermediate Crude, $WTIC, closed unchanged at $125.50.
Gold, $GOLD, fell to $860.
Volatility, $VIX, closed basically unchanged at 17.66.
The Fed's actions and charts are truly scarry
Overall, little has changed from yesterday; I am terrified by the Fed's chart showing that over $100 Billion of liquidity has been transferred out of the Federal Reserve's vaults as this evidences that the banks are insolvent, and that the investment bankers are "zombie corporations" -- soulless, capital-eating monsters.
The Financial Ninja relates regarding the Federal Reserves facilities of TAF, TSLF And PDCF that:
An interesting chart was present by Dr. Janet Yellen this morning showing the Fed's balance sheet; this graph shows that about half the Fed's U.S. Treasuries have been committed to fight the liquidity crisis.
The Fed has basically traded in high quality instruments, US treasuries, for low quality instruments that the market doesn’t want at all or is pricing at levels deemed unacceptable by those market participants still denying reality.
The Fed has committed half of its $800 billion balance sheet to battle the RESIDENTIAL real estate bubble implosion. The COMMERCIAL real estate bubble implosion has yet to get well underway. Revolving credit, such as credit card debt has yet to implode as well. Job losses have yet to accelerate. The recession has yet to gather steam.
He reminds that The Fed Is Almost Out Of Ammo, Citigroup and UBS Too.
Total Borrowings of Depository Institutions (Chart: BORROW) are fast approaching $150 billion. This does not include the effect of the $50 billion increase in the TAF limit to $150 billion.
This has already pushed Non-Borrowed Reserves (Chart: BOGNONBR) to a NEGATIVE $100 billion. This is likely just to get worse as the balance sheets of financial institutions continue to deteriorate.
The balance sheets of almost all financial institutions, whether they be depository institutions or prime brokers WILL DETERIORATE further. They have to. The vast majority of their balance sheets are now in the Level 2 or Level 3 asset buckets.
As I said in Bulltrap: ABCP, and Level 3 Bombs, I can’t imagine that these assets are currently being undervalued or even conservatively valued.
That just NOT how these fellows roll. This is Wall Street man! Privatize the profits, and socialize the losses!"
And I'm even more terrifid by yesterday's Craig Torres and Steve Matthews report in Bloomberg that Bernanke Stands Ready To Boost Loans to Banks as Needed: we are going from bad to worse!
Federal Reserve Chairman Ben S. Bernanke said financial markets remain unsettled and the central bank will increase its auctions of cash to banks as needed.
While markets have improved, they remain ``far from normal,'' Bernanke said today in a speech to an Atlanta Fed conference at Sea Island, Georgia. ``We stand ready to increase the size of the auctions if further warranted by financial developments.''
Bernanke's comments contrast with those by Treasury Secretary Henry Paulson and Wall Street leaders including Vikram Pandit, chief executive officer of Citigroup Inc., who say the worst of the credit crisis is over. The Fed chief said it will take ``some time'' for financial firms to resolve the crisis by raising new capital and strengthening their management of risk.
Investment Application
Given today's failed rally, it's 'lock and load' with a broad based short selling strategy; or even better yet, a 'dollar cost average buy' of gold at BullionVault.com.
Here is one database of stocks, from which I suggest that one sell DRYS at 99.04 as it manifested a shooting star.
And here is yet even another database of stocks I recommend short selling; one of its stocks I recommend selling is Apple, AAPL, as it manifested a bearish engulfing candlestick.
Off all the short selling opportunities that exist today, I most definitely recommend the semiconductors, as these are going to move very quickly, greatly rewarding those who are short.
And I present these 200% ETFs for short selling and these 100% ETFs for short selling as well.
