Wednesday, June 30, 2010
FA...Stocks and interest rates tumble on fears that recovery will fade; Consumer confidence slumps
Tim Paradis, AP Business Writer, On Tuesday June 29, 2010, 5:58 pm EDT
NEW YORK (AP) -- No matter where they look, investors are seeing economic trouble.
Stocks and interest rates plunged Tuesday after signs of slowing economies from China to the U.S. spooked traders who were already uneasy about a global recovery. The Dow Jones industrial average fell 268 points, or 2.7 percent, and dropped below 10,000. The benchmark Standard & Poor's 500 index dropped 3.1 percent to close at its lowest level since October.
Interest rates fell in the Treasury market after demand for the safety of government debt grew. The yield on the 10-year note dropped to 2.95 percent, the first time it has fallen below 3 percent since April 2009, when the markets were in the early stages of their recovery from the financial crisis. The yield is used as a benchmark for many consumer loans and mortgages. The yield on the two-year note hit a new low.
The markets began the day by following Asian and European stocks lower. Asian exchanges fell after an index that forecasts economic activity for China was revised lower. European stocks continued the slide after Greek workers walked off the job to protest steep budget cuts.
Then, shortly after U.S. trading began, the market was hit with news that consumer confidence fell sharply this month because of worries about jobs and the overall economy. The Conference Board's Consumer Confidence Index fell to 52.9 from a revised 62.7 in May. It was the steepest drop since February and economists polled by Thomson Reuters had forecast only a modest dip.
Investors are also anxious as they wait for the Labor Department's monthly employment report on Friday. Companies have indicated that business is getting better, yet there are few signs that they are ready to hire in big numbers. The government is expected to say that the unemployment rate rose 0.1 percentage point to 9.8 percent in June.
Industrial stocks suffered some of the steepest drops on fears that a stalled global rebound will cut demand. Aircraft maker Boeing Co. led the Dow lower with a drop of 6.3 percent. Caterpillar Inc., the maker of construction and mining equipment, lost 5.5 percent. Shares of coal producers pulled energy stocks lower on worries about a slowdown.
Investors have been so burned by the financial crisis of 2008-09 that they fear any hint of a slowdown means the economy will start tanking again. And they're selling heavily at the end of the day, fearful about negative economic news that could start coming out of Asia just hours after U.S. trading ends.
Paul Zemsky, head of asset allocation at ING Investment Management in New York, said investors are wrestling with two opposing ideas of where the economy is headed. He said the more likely case is that the recovery continues and corporate earnings growth make stocks look cheap right now. The darker scenario is that government budget cuts, the end of fiscal stimulus, problems in Europe and a slowdown in China lead to a double-dip in the global economy.
Investors' indecision and uneven economic reports have brought big swings to stocks since late April when debt problems in Greece began to pound world markets.
"The central issue that any investor faces today is fire or ice," Zemsky said. "There's no in-between. It's either one or the other."
The Dow fell 268.22, or 2.7 percent, to 9,870.30, its lowest close since June 7. During the last hour, the Dow was down 326.60. The Dow has fallen 428 points, or 4.2 percent, in the past four days.
The Standard & Poor's 500 index fell 33.33, or 3.1 percent, to 1,041.24. It was the lowest close for the S&P since Oct. 5 and the fifth drop of more than 3 percent in the past year. The index is now down 14.5 percent from its 2010 peak in April.
The Nasdaq composite index fell 85.47, or 3.9 percent, to 2,135.18.
Only about 260 stocks rose while about 2,840 fell at the New York Stock Exchange, where consolidated volume came to 6.3 billion shares, compared with a light 3.9 billion Monday.
Mike Shea, managing partner at Direct Access Partners LLC in New York, took some comfort in the fact that the market closed off its lowest level of the day. That signaled that some buyers were willing to step in.
"Getting that little pop at the end of the day -- it's kind of losing a football game 35-0 and then scoring a touchdown in the last five minutes," he said.
Shea cautioned that trading could continue to be volatile Wednesday, which is the final day of the quarter and the first half. For some traders, it's the last day of their fiscal year. "The market can be a little wacky on the last days of quarters," he said.
Crude oil fell $2.31 to $75.94 per barrel on the New York Mercantile Exchange.
The yield on the two-year Treasury note traded as low as 0.59 percent, below the 0.60 percent from December 2008 during the peak of the financial crisis.
The Chicago Board Options Exchange's Volatility Index rose 17.7 percent. The VIX is known as the market's fear gauge because a rise signals traders are expecting more drops in stocks.
Zemsky said there isn't much until the start of corporate earnings reports next month that likely will give investors solid answers about the direction of the economy. Until then, Friday's June jobs report is the one standout. Even with a good report, investors might still be focused on earnings. The May jobs numbers were a disappointment because private employers hired only 41,000 workers.
"I don't think Friday payrolls can do a lot to bring the market a whole lot higher if they're good. But if they're bad, it's really 'Look out below,'" Zemsky said.
A drop in the euro to $1.2181 was another sign of traders' nervousness. A slide in the 16-nation currency has for months indicated fading confidence in Europe's ability to handle big budget deficits.
Greece is required to make the cuts under terms of a bailout from other European Union members and the International Monetary Fund. Protests over government cost-cutting in Greece renewed concerns about how well European countries will be able to stick to austerity plans.
In other trading, Chinese markets fell after the Conference Board's Leading Economic Index for China was revised to 0.3 percent for April from 1.7 percent.
Boeing fell $4.26, or 6.3 percent, to $63.04 and Caterpillar, also a Dow stock, fell $3.55, or 5.5 percent, to $60.85.
Coal company Peabody Energy Corp. fell $3.16, or 7.4 percent, to $39.33, while mining company Massey Energy Co. fell $2.25, or 7.5 percent, to $27.95.
The Russell 2000 index of smaller companies fell 25.58, or 4 percent, to 615.96.
The Shanghai composite index fell 4.3 percent to a 14-month low. Japan's Nikkei stock average fell 1.3 percent. Britain's FTSE 100 fell 3.1 percent, Germany's DAX index dropped 3.3 percent, and France's CAC-40 fell 4 percent
NEW YORK (AP) -- No matter where they look, investors are seeing economic trouble.
Stocks and interest rates plunged Tuesday after signs of slowing economies from China to the U.S. spooked traders who were already uneasy about a global recovery. The Dow Jones industrial average fell 268 points, or 2.7 percent, and dropped below 10,000. The benchmark Standard & Poor's 500 index dropped 3.1 percent to close at its lowest level since October.
Interest rates fell in the Treasury market after demand for the safety of government debt grew. The yield on the 10-year note dropped to 2.95 percent, the first time it has fallen below 3 percent since April 2009, when the markets were in the early stages of their recovery from the financial crisis. The yield is used as a benchmark for many consumer loans and mortgages. The yield on the two-year note hit a new low.
The markets began the day by following Asian and European stocks lower. Asian exchanges fell after an index that forecasts economic activity for China was revised lower. European stocks continued the slide after Greek workers walked off the job to protest steep budget cuts.
Then, shortly after U.S. trading began, the market was hit with news that consumer confidence fell sharply this month because of worries about jobs and the overall economy. The Conference Board's Consumer Confidence Index fell to 52.9 from a revised 62.7 in May. It was the steepest drop since February and economists polled by Thomson Reuters had forecast only a modest dip.
Investors are also anxious as they wait for the Labor Department's monthly employment report on Friday. Companies have indicated that business is getting better, yet there are few signs that they are ready to hire in big numbers. The government is expected to say that the unemployment rate rose 0.1 percentage point to 9.8 percent in June.
Industrial stocks suffered some of the steepest drops on fears that a stalled global rebound will cut demand. Aircraft maker Boeing Co. led the Dow lower with a drop of 6.3 percent. Caterpillar Inc., the maker of construction and mining equipment, lost 5.5 percent. Shares of coal producers pulled energy stocks lower on worries about a slowdown.
Investors have been so burned by the financial crisis of 2008-09 that they fear any hint of a slowdown means the economy will start tanking again. And they're selling heavily at the end of the day, fearful about negative economic news that could start coming out of Asia just hours after U.S. trading ends.
Paul Zemsky, head of asset allocation at ING Investment Management in New York, said investors are wrestling with two opposing ideas of where the economy is headed. He said the more likely case is that the recovery continues and corporate earnings growth make stocks look cheap right now. The darker scenario is that government budget cuts, the end of fiscal stimulus, problems in Europe and a slowdown in China lead to a double-dip in the global economy.
Investors' indecision and uneven economic reports have brought big swings to stocks since late April when debt problems in Greece began to pound world markets.
"The central issue that any investor faces today is fire or ice," Zemsky said. "There's no in-between. It's either one or the other."
The Dow fell 268.22, or 2.7 percent, to 9,870.30, its lowest close since June 7. During the last hour, the Dow was down 326.60. The Dow has fallen 428 points, or 4.2 percent, in the past four days.
The Standard & Poor's 500 index fell 33.33, or 3.1 percent, to 1,041.24. It was the lowest close for the S&P since Oct. 5 and the fifth drop of more than 3 percent in the past year. The index is now down 14.5 percent from its 2010 peak in April.
The Nasdaq composite index fell 85.47, or 3.9 percent, to 2,135.18.
Only about 260 stocks rose while about 2,840 fell at the New York Stock Exchange, where consolidated volume came to 6.3 billion shares, compared with a light 3.9 billion Monday.
Mike Shea, managing partner at Direct Access Partners LLC in New York, took some comfort in the fact that the market closed off its lowest level of the day. That signaled that some buyers were willing to step in.
"Getting that little pop at the end of the day -- it's kind of losing a football game 35-0 and then scoring a touchdown in the last five minutes," he said.
Shea cautioned that trading could continue to be volatile Wednesday, which is the final day of the quarter and the first half. For some traders, it's the last day of their fiscal year. "The market can be a little wacky on the last days of quarters," he said.
Crude oil fell $2.31 to $75.94 per barrel on the New York Mercantile Exchange.
The yield on the two-year Treasury note traded as low as 0.59 percent, below the 0.60 percent from December 2008 during the peak of the financial crisis.
The Chicago Board Options Exchange's Volatility Index rose 17.7 percent. The VIX is known as the market's fear gauge because a rise signals traders are expecting more drops in stocks.
Zemsky said there isn't much until the start of corporate earnings reports next month that likely will give investors solid answers about the direction of the economy. Until then, Friday's June jobs report is the one standout. Even with a good report, investors might still be focused on earnings. The May jobs numbers were a disappointment because private employers hired only 41,000 workers.
"I don't think Friday payrolls can do a lot to bring the market a whole lot higher if they're good. But if they're bad, it's really 'Look out below,'" Zemsky said.
A drop in the euro to $1.2181 was another sign of traders' nervousness. A slide in the 16-nation currency has for months indicated fading confidence in Europe's ability to handle big budget deficits.
Greece is required to make the cuts under terms of a bailout from other European Union members and the International Monetary Fund. Protests over government cost-cutting in Greece renewed concerns about how well European countries will be able to stick to austerity plans.
In other trading, Chinese markets fell after the Conference Board's Leading Economic Index for China was revised to 0.3 percent for April from 1.7 percent.
Boeing fell $4.26, or 6.3 percent, to $63.04 and Caterpillar, also a Dow stock, fell $3.55, or 5.5 percent, to $60.85.
Coal company Peabody Energy Corp. fell $3.16, or 7.4 percent, to $39.33, while mining company Massey Energy Co. fell $2.25, or 7.5 percent, to $27.95.
The Russell 2000 index of smaller companies fell 25.58, or 4 percent, to 615.96.
The Shanghai composite index fell 4.3 percent to a 14-month low. Japan's Nikkei stock average fell 1.3 percent. Britain's FTSE 100 fell 3.1 percent, Germany's DAX index dropped 3.3 percent, and France's CAC-40 fell 4 percent
Tuesday, June 29, 2010
FA...Interest rates keep falling as investor view of economy dims further; stocks edge lower
Tim Paradis, AP Business Writers, On Monday June 28, 2010, 5:58 pm EDT
NEW YORK (AP) -- A darkening view of the economy sent bond market interest rates to their lowest level in 14 months and kept many investors out of the stock market.
The yield on the 10-year Treasury note, considered a benchmark because it's used to set rates on consumer loans including mortgages, fell to 3.03 percent Monday, its lowest point since late April 2009. At that time, the markets were still recovering from the devastation of the financial crisis and collapse in stocks.
Investors felt safer making their bets in the bond market and many avoided any kind of stock trades. All the major stock indexes fell by single digits. The New York Stock Exchange traded less than a billion shares on its selling floor, a number that's more likely to be seen in August or late December than in June.
Treasurys benefited from investors' growing gloom. The latest bit of bad economic news came from the Commerce Department, which said consumers saved more than they spent last month. The government said consumer spending rose 0.2 percent last month, just above the 0.1 percent growth forecast by economists polled by Thomson Reuters. However, personal income rose 0.4 percent.
Consumer spending remains a sticking point for the economy, which won't have a strong recovery until consumers fell more confident about buying again. With the recovery looking more uncertain, many investors are choosing to go with bonds because they are considered stable. And investors are willing to put up with bonds' lower returns simply because they are safer than stocks.
The 10-year note's 3.03 percent yield compared with 3.11 percent late Friday. It hasn't been this low since April 28 of last year.
Investors are also growing anxious ahead of the release of the government's June employment report on Friday. The May report was troubling because it showed that private employers are hiring few workers. That hurts the economy since consumers aren't likely to spend if they aren't working or are worried about losing their jobs.
Burt White, chief investment officer at LPL Financial in Boston, said the coming weeks will be important for investors because of the jobs report on Friday and the announcement of earnings for the April-June quarter. White said stronger profits could convince businesses to start investing more. That, economists hope, will lead to more hiring.
"Businesses have to commit to this recovery," White said.
The Dow Jones industrial average fell 5.29, or 0.1 percent, to 10,138.52 after being up 58 points.
The broader Standard & Poor's 500 index fell 2.19, or 0.2 percent, to 1,074.57. The Nasdaq composite index fell 2.83, or 0.1 percent, to 2,220.65.
Commodities, seen as risky investments along with stocks also fell, but their drop was also influenced by a stronger dollar. A rise in the dollar made commodities more expensive for foreign buyers. Crude oil fell 61 cents to $78.25 per barrel on the New York Mercantile Exchange, while gold fell.
The drop in commodities sent raw materials producers falling. Exxon Mobil Corp. 63 cents, or 1.1 percent, to $58.47, while gold producer Freeport-McMoRan fell $1.91, or 2.9 percent, to $64.66.
Meanwhile, tobacco stocks rose after the Supreme Court said it wouldn't take up a case between the government and tobacco makers. The decision prevents the government from getting billions of dollars from makers of cigarettes for anti-smoking campaigns. Reynolds American Inc. rose $2.08, or 4.1 percent, to $53.45, and Altria Group Inc., parent of Philip Morris USA, rose 64 cents, or 3.3 percent, to $20.34.
A separate decision from the court signaled that gun control laws in Chicago and a nearby suburb likely would be struck down by a lower court. That gave a boost to shares of gun makers. Smith & Wesson rose 23 cents, or 5.6 percent, to $4.33, while Sturm, Ruger & Co. climbed 33 cents, or 2.2 percent, to $15.39.
Retailers were hurt by the consumer spending report. Macy's Inc. lost 20 cents, or 1.1 percent, to $18.82, and Amazon.com Inc. fell $3.20, or 2.6 percent, to $117.80. Home Depot Inc. fell 61 cents, or 2 percent, to $29.59.
Eight stocks fell for every seven that rose on the NYSE. Volume on the exchange floor came to 942 million shares. Consolidated volume, which includes shares traded on other exchanges, totaled 3.94 billion, also a very low figure.
The Russell 2000 index of smaller companies fell 3.57, or 0.6 percent, to 641.54.
Britain's FTSE 100 rose 0.5 percent, Germany's DAX index gained 1.4 percent, and France's CAC-40 rose 1.6 percent. Japan's Nikkei stock average fell 0.5 percent.
NEW YORK (AP) -- A darkening view of the economy sent bond market interest rates to their lowest level in 14 months and kept many investors out of the stock market.
The yield on the 10-year Treasury note, considered a benchmark because it's used to set rates on consumer loans including mortgages, fell to 3.03 percent Monday, its lowest point since late April 2009. At that time, the markets were still recovering from the devastation of the financial crisis and collapse in stocks.
Investors felt safer making their bets in the bond market and many avoided any kind of stock trades. All the major stock indexes fell by single digits. The New York Stock Exchange traded less than a billion shares on its selling floor, a number that's more likely to be seen in August or late December than in June.
Treasurys benefited from investors' growing gloom. The latest bit of bad economic news came from the Commerce Department, which said consumers saved more than they spent last month. The government said consumer spending rose 0.2 percent last month, just above the 0.1 percent growth forecast by economists polled by Thomson Reuters. However, personal income rose 0.4 percent.
Consumer spending remains a sticking point for the economy, which won't have a strong recovery until consumers fell more confident about buying again. With the recovery looking more uncertain, many investors are choosing to go with bonds because they are considered stable. And investors are willing to put up with bonds' lower returns simply because they are safer than stocks.
The 10-year note's 3.03 percent yield compared with 3.11 percent late Friday. It hasn't been this low since April 28 of last year.
Investors are also growing anxious ahead of the release of the government's June employment report on Friday. The May report was troubling because it showed that private employers are hiring few workers. That hurts the economy since consumers aren't likely to spend if they aren't working or are worried about losing their jobs.
Burt White, chief investment officer at LPL Financial in Boston, said the coming weeks will be important for investors because of the jobs report on Friday and the announcement of earnings for the April-June quarter. White said stronger profits could convince businesses to start investing more. That, economists hope, will lead to more hiring.
"Businesses have to commit to this recovery," White said.
The Dow Jones industrial average fell 5.29, or 0.1 percent, to 10,138.52 after being up 58 points.
The broader Standard & Poor's 500 index fell 2.19, or 0.2 percent, to 1,074.57. The Nasdaq composite index fell 2.83, or 0.1 percent, to 2,220.65.
Commodities, seen as risky investments along with stocks also fell, but their drop was also influenced by a stronger dollar. A rise in the dollar made commodities more expensive for foreign buyers. Crude oil fell 61 cents to $78.25 per barrel on the New York Mercantile Exchange, while gold fell.
The drop in commodities sent raw materials producers falling. Exxon Mobil Corp. 63 cents, or 1.1 percent, to $58.47, while gold producer Freeport-McMoRan fell $1.91, or 2.9 percent, to $64.66.
Meanwhile, tobacco stocks rose after the Supreme Court said it wouldn't take up a case between the government and tobacco makers. The decision prevents the government from getting billions of dollars from makers of cigarettes for anti-smoking campaigns. Reynolds American Inc. rose $2.08, or 4.1 percent, to $53.45, and Altria Group Inc., parent of Philip Morris USA, rose 64 cents, or 3.3 percent, to $20.34.
A separate decision from the court signaled that gun control laws in Chicago and a nearby suburb likely would be struck down by a lower court. That gave a boost to shares of gun makers. Smith & Wesson rose 23 cents, or 5.6 percent, to $4.33, while Sturm, Ruger & Co. climbed 33 cents, or 2.2 percent, to $15.39.
Retailers were hurt by the consumer spending report. Macy's Inc. lost 20 cents, or 1.1 percent, to $18.82, and Amazon.com Inc. fell $3.20, or 2.6 percent, to $117.80. Home Depot Inc. fell 61 cents, or 2 percent, to $29.59.
Eight stocks fell for every seven that rose on the NYSE. Volume on the exchange floor came to 942 million shares. Consolidated volume, which includes shares traded on other exchanges, totaled 3.94 billion, also a very low figure.
The Russell 2000 index of smaller companies fell 3.57, or 0.6 percent, to 641.54.
Britain's FTSE 100 rose 0.5 percent, Germany's DAX index gained 1.4 percent, and France's CAC-40 rose 1.6 percent. Japan's Nikkei stock average fell 0.5 percent.
Monday, June 28, 2010
Cuff 'em! No New Bull Market Without 'Perp Walks' for "Financial Terrorists"
Posted Jun 25, 2010 01:13pm EDT by Peter Gorenstein
Related: bac, gs, xlf, aig, ^dji, ^gspc, spy
Convicted felons and former captains of industry Jeff Skilling and Conrad Black caught a break Thursday: The Supreme Court ruled to limit the reach of a federal fraud law that prosecutors used to convict both men. The decision doesn’t set them free but does send their case back to the lower courts and opens the possibility of retrial.
“This is the worst possible time for this case to come up,” says Damien Hoffman, co-founder of Wall Street Cheat Sheet. The conviction of Skilling, Black, Enron Chairman Ken Lay, and former WorldCom CEO Bernie Ebbers helped fuel the last bull market in the mid-2000s says Derek Hoffman, Damien’s brother and business partner. “When they were put behind bars there was a turn in investor sentiment.”
What we need to fuel another bull market, the Hoffman brothers contend, is a new round of perp walks and convictions for those responsible for the crash of 2008. “So long as investors think another Dick Fuld or Bernie Madoff is lurking on the next corner, gold, guns and canned soup will seem the safer bet,” they write in a recent article.
Here’s a few of the names the Hoffman Brothers think belong behind bars
- Joseph Cassano — the former head of AIG’s financial products unit. Under his watch the company amassed massive amounts of risk that lead to the biggest bailout in U.S. history. There’s very little chance of Cassano facing time, however; Federal prosecutors recently dropped their investigation against him.
- Dick Fuld — Lehman Brothers CEO who watched his house of cards come tumbling down, bringing the global financial system to the edge of the collapse.
- Angelo Mozilo — The Countrywide CEO helped fuel the subprime madness. His company’s lack of due diligence is a prime reason for the foreclosure problem. Mozilo also co-founded IndyMac, the large California bank that was seized by the FDIC in July 2008.
- Stanley O’Neal — the former Merrill Lynch CEO pushed the firm to aggressively market and trade CDOs. O'Neal left with the firm on the brink of collapse before Bank of America purchased it. For all his good work, O’Neal was fired but left with a golden parachute and options valued at $161.5 million at the time.
- Fabrice “Fabulous Fab” Tourre — the banker at the center of the SEC’s criminal fraud complaint against Goldman Sachs. “People need to know the Goldman’s of the world don’t have politicians in their pockets and that the American markets are a safe place to put your money,” says Damien.
The Hoffman Brothers also note that during the S&L scandal of the 1980s over 1,000 people went to jail. To date only two Bear Stearns hedge fund managers have even gone on trial. Both were acquitted. Meanwhile, Skilling is serving a 24-year sentence in Colorado.
Related: bac, gs, xlf, aig, ^dji, ^gspc, spy
Convicted felons and former captains of industry Jeff Skilling and Conrad Black caught a break Thursday: The Supreme Court ruled to limit the reach of a federal fraud law that prosecutors used to convict both men. The decision doesn’t set them free but does send their case back to the lower courts and opens the possibility of retrial.
“This is the worst possible time for this case to come up,” says Damien Hoffman, co-founder of Wall Street Cheat Sheet. The conviction of Skilling, Black, Enron Chairman Ken Lay, and former WorldCom CEO Bernie Ebbers helped fuel the last bull market in the mid-2000s says Derek Hoffman, Damien’s brother and business partner. “When they were put behind bars there was a turn in investor sentiment.”
What we need to fuel another bull market, the Hoffman brothers contend, is a new round of perp walks and convictions for those responsible for the crash of 2008. “So long as investors think another Dick Fuld or Bernie Madoff is lurking on the next corner, gold, guns and canned soup will seem the safer bet,” they write in a recent article.
Here’s a few of the names the Hoffman Brothers think belong behind bars
- Joseph Cassano — the former head of AIG’s financial products unit. Under his watch the company amassed massive amounts of risk that lead to the biggest bailout in U.S. history. There’s very little chance of Cassano facing time, however; Federal prosecutors recently dropped their investigation against him.
- Dick Fuld — Lehman Brothers CEO who watched his house of cards come tumbling down, bringing the global financial system to the edge of the collapse.
- Angelo Mozilo — The Countrywide CEO helped fuel the subprime madness. His company’s lack of due diligence is a prime reason for the foreclosure problem. Mozilo also co-founded IndyMac, the large California bank that was seized by the FDIC in July 2008.
- Stanley O’Neal — the former Merrill Lynch CEO pushed the firm to aggressively market and trade CDOs. O'Neal left with the firm on the brink of collapse before Bank of America purchased it. For all his good work, O’Neal was fired but left with a golden parachute and options valued at $161.5 million at the time.
- Fabrice “Fabulous Fab” Tourre — the banker at the center of the SEC’s criminal fraud complaint against Goldman Sachs. “People need to know the Goldman’s of the world don’t have politicians in their pockets and that the American markets are a safe place to put your money,” says Damien.
The Hoffman Brothers also note that during the S&L scandal of the 1980s over 1,000 people went to jail. To date only two Bear Stearns hedge fund managers have even gone on trial. Both were acquitted. Meanwhile, Skilling is serving a 24-year sentence in Colorado.
Sunday, June 27, 2010
Friday, June 25, 2010
FA..Stocks drop following downbeat forecasts from retailers; Traders eye costs of bank regulation
Stephen Bernard and Tim Paradis, AP Business Writers, On Thursday June 24, 2010, 6:04 pm EDT
NEW YORK (AP) -- Disappointing forecasts from retailers and concern about the government's financial overhaul package pounded stocks Thursday.
The Dow Jones industrial average lost 146 points after edging higher Wednesday. Broader indexes dropped for a fourth straight day.
Downbeat forecasts from retailers raised concerns that high unemployment and weak consumer spending would stall an economic rebound. Nike Inc. dropped 4 percent after saying increased costs could hurt earnings. Bed Bath & Beyond fell 5.6 percent after the home goods retailer's second-quarter earnings forecast missed expectations.
Dell Inc. lost 6.4 percent after the computer maker's fiscal year forecast failed to top expectations, as some analysts had hoped.
Meanwhile, financial stocks fell after Congress continued working on a bill to overhaul regulation of the industry. Democratic leaders hoped to reconcile the House and Senate bills so President Barack Obama can have a deal in place by the time he meets with the leaders of the Group of 20 nations this weekend in Toronto.
Traders were concerned that some provisions of the bill would cut into bank profits. Large banks were lobbying to strike a proposal that would make the industry cover costs to dismantle the mortgage giants Fannie Mae and Freddie Mac. Bank of America Corp. dropped 2.7 percent and JPMorgan Chase & Co. lost 2.2 percent.
Economic news didn't help. The government said initial claims for unemployment benefits fell last week but remained above the level that would signal employers are ramping up hiring. A second report indicated that orders for durable goods fell last month for the first time in six months. Orders for big-ticket goods fell 1.1 percent in May. Analysts predicted a 1.3 percent drop.
"There is just such a stagnation in the economy," said Dan Deming, a trader with Stutland Equities in Chicago. Deming said investors are struggling to determine whether the economy can continue to bounce back without as much help from government spending.
"The water is so murky right now," Deming said. "It's just very hard to get a picture of where we're at."
The Dow fell 145.64, or 1.4 percent, to 10,152.80. The Standard & Poor's 500 index fell 18.35, or 1.7 percent, to 1,073.69. It was the first four-day drop for the S&P 500 index since early May. The Nasdaq composite index fell 36.81, 1.6 percent, to 2,217.42.
Interest rates were mixed in the Treasury market. The yield on the benchmark 10-year Treasury note rose to 3.14 percent from 3.12 percent late Wednesday. The yield had fallen to a 13-month low of 3.07 percent.
The recent drop in rates is good news for borrowers. Freddie Mac said Thursday that the cost of a home loan has fallen this week to the lowest level on record. The average rate on a 30-year fixed mortgage dropped to 4.69 percent from 4.75 percent last week.
Crude oil rose 16 cents to settle at $76.51 a barrel on the New York Mercantile Exchange.
The market's moves were also being driven by traders preparing for changes Friday to some of the stocks that make up the Russell 2000 index of smaller companies. The Russell 2000 fell 11.08, or 1.7 percent, to 633.17.
The slump in stocks made clear that anxiety is still ruling the market, after appearing to have waned last week. The Dow and other major stock indexes touched new lows for 2010 earlier this month, then regained some ground when fears about a debt blowup in Europe began to ease.
Now, the concern is that cracks are appearing in the U.S. recovery. Since last week, several reports on housing and jobs have indicated that the economy's biggest trouble spots aren't getting much better. Even manufacturing, which has been one of the strongest areas of the economy, looked weaker in one report last week. Analysts warn against drawing big conclusions from a few reports but investors will want to see some better numbers for stocks to resume their climb.
The latest numbers point to "substantive holes in the economic recovery story," said Tom Samuels, portfolio manager of the Palantir Fund in Houston.
The Federal Reserve said Wednesday that the economy is continuing to recover, but that risks remain. It signaled that the problems in Europe are a risk for the U.S.
Mike Rubino, CEO of Rubino Financial Group in Troy, Mich., said investors had been expecting the economy to improve "at a much faster level" than they're seeing. That disappointment has pulled stocks from their 2010 highs in late April.
The government is set to release its final number Friday on gross domestic product for the first quarter.
Among stocks, Nike fell $2.89, or 4 percent, to $69.63, while Bed Bath & Beyond fell $2.34, or 5.6 percent, to $39.12.
Bank of America fell 41 cents, or 2.7 percent, to $15.02 and JPMorgan dropped 86 cents, or 2.2 percent, to $38.03.
Stocks of health care companies benefited from increased demand for investments considered reliable in a weak economy. Health care and consumer products maker Johnson & Johnson rose 61 cents to $59.60.
More than three stocks fell for every one that rose on the New York Stock Exchange, where consolidated volume came to 4.9 billion shares, compared with 4.6 billion Wednesday.
Britain's FTSE 100 fell 1.5 percent, Germany's DAX index dropped 1.4 percent, and France's CAC-40 fell 2.4 percent. Japan's Nikkei stock average rose 0.1 percent.
NEW YORK (AP) -- Disappointing forecasts from retailers and concern about the government's financial overhaul package pounded stocks Thursday.
The Dow Jones industrial average lost 146 points after edging higher Wednesday. Broader indexes dropped for a fourth straight day.
Downbeat forecasts from retailers raised concerns that high unemployment and weak consumer spending would stall an economic rebound. Nike Inc. dropped 4 percent after saying increased costs could hurt earnings. Bed Bath & Beyond fell 5.6 percent after the home goods retailer's second-quarter earnings forecast missed expectations.
Dell Inc. lost 6.4 percent after the computer maker's fiscal year forecast failed to top expectations, as some analysts had hoped.
Meanwhile, financial stocks fell after Congress continued working on a bill to overhaul regulation of the industry. Democratic leaders hoped to reconcile the House and Senate bills so President Barack Obama can have a deal in place by the time he meets with the leaders of the Group of 20 nations this weekend in Toronto.
Traders were concerned that some provisions of the bill would cut into bank profits. Large banks were lobbying to strike a proposal that would make the industry cover costs to dismantle the mortgage giants Fannie Mae and Freddie Mac. Bank of America Corp. dropped 2.7 percent and JPMorgan Chase & Co. lost 2.2 percent.
Economic news didn't help. The government said initial claims for unemployment benefits fell last week but remained above the level that would signal employers are ramping up hiring. A second report indicated that orders for durable goods fell last month for the first time in six months. Orders for big-ticket goods fell 1.1 percent in May. Analysts predicted a 1.3 percent drop.
"There is just such a stagnation in the economy," said Dan Deming, a trader with Stutland Equities in Chicago. Deming said investors are struggling to determine whether the economy can continue to bounce back without as much help from government spending.
"The water is so murky right now," Deming said. "It's just very hard to get a picture of where we're at."
The Dow fell 145.64, or 1.4 percent, to 10,152.80. The Standard & Poor's 500 index fell 18.35, or 1.7 percent, to 1,073.69. It was the first four-day drop for the S&P 500 index since early May. The Nasdaq composite index fell 36.81, 1.6 percent, to 2,217.42.
Interest rates were mixed in the Treasury market. The yield on the benchmark 10-year Treasury note rose to 3.14 percent from 3.12 percent late Wednesday. The yield had fallen to a 13-month low of 3.07 percent.
The recent drop in rates is good news for borrowers. Freddie Mac said Thursday that the cost of a home loan has fallen this week to the lowest level on record. The average rate on a 30-year fixed mortgage dropped to 4.69 percent from 4.75 percent last week.
Crude oil rose 16 cents to settle at $76.51 a barrel on the New York Mercantile Exchange.
The market's moves were also being driven by traders preparing for changes Friday to some of the stocks that make up the Russell 2000 index of smaller companies. The Russell 2000 fell 11.08, or 1.7 percent, to 633.17.
The slump in stocks made clear that anxiety is still ruling the market, after appearing to have waned last week. The Dow and other major stock indexes touched new lows for 2010 earlier this month, then regained some ground when fears about a debt blowup in Europe began to ease.
Now, the concern is that cracks are appearing in the U.S. recovery. Since last week, several reports on housing and jobs have indicated that the economy's biggest trouble spots aren't getting much better. Even manufacturing, which has been one of the strongest areas of the economy, looked weaker in one report last week. Analysts warn against drawing big conclusions from a few reports but investors will want to see some better numbers for stocks to resume their climb.
The latest numbers point to "substantive holes in the economic recovery story," said Tom Samuels, portfolio manager of the Palantir Fund in Houston.
The Federal Reserve said Wednesday that the economy is continuing to recover, but that risks remain. It signaled that the problems in Europe are a risk for the U.S.
Mike Rubino, CEO of Rubino Financial Group in Troy, Mich., said investors had been expecting the economy to improve "at a much faster level" than they're seeing. That disappointment has pulled stocks from their 2010 highs in late April.
The government is set to release its final number Friday on gross domestic product for the first quarter.
Among stocks, Nike fell $2.89, or 4 percent, to $69.63, while Bed Bath & Beyond fell $2.34, or 5.6 percent, to $39.12.
Bank of America fell 41 cents, or 2.7 percent, to $15.02 and JPMorgan dropped 86 cents, or 2.2 percent, to $38.03.
Stocks of health care companies benefited from increased demand for investments considered reliable in a weak economy. Health care and consumer products maker Johnson & Johnson rose 61 cents to $59.60.
More than three stocks fell for every one that rose on the New York Stock Exchange, where consolidated volume came to 4.9 billion shares, compared with 4.6 billion Wednesday.
Britain's FTSE 100 fell 1.5 percent, Germany's DAX index dropped 1.4 percent, and France's CAC-40 fell 2.4 percent. Japan's Nikkei stock average rose 0.1 percent.
Thursday, June 24, 2010
Tuesday, June 22, 2010
China's easing of currency's peg to dollar aims to blunt trade criticism and aid own economy
Elaine Kurtenbach, AP Business Writer, On Monday June 21, 2010, 1:39 pm EDT
SHANGHAI (AP) -- By loosening its currency's peg to the dollar, China is seeking to defuse complaints that it keeps its exports artificially cheap, strengthen its hand against inflation and ensure its economy can keep growing at a healthy pace.
The Chinese yuan surged to a record high Monday as Beijing delivered on its central bank's weekend promise of greater flexibility in its exchange rates. World shares rallied as investors took heart from the signal of confidence in China's resilience.
Analysts said the move was not a major shift in foreign policy. They described it instead as a maneuver aimed mainly at countering criticism of Beijing's currency policies before this weekend's summit of the Group of 20 leading economies. Beijing's trading partners have been frustrated by their perennial trade imbalances with China.
"This is a type of 'diplomatese' before the G-20," said Yi Xianrong, a prominent economist at the Institute of Finance in the Chinese Academy of Social Sciences, a government think-tank.
But Beijing's decision to give up the dollar link it imposed two years ago to help its exporters during the recession also shows it recognizes the need for flexibility in its own economic policies.
China's large trade surpluses oblige the central bank to intervene in the exchange market: It buys up excess foreign exchange earnings to keep the yuan's value from rising. Greater flexibility will allow more leeway in China's monetary policies, helping it counter inflation.
"Chinese policymakers are attempting to engineer a scenario that maximizes political goodwill while at the same time minimizes any negative economic impact," said Alaistair Chan, an economist at Moody's Analytics in Sydney.
The shift away from the dollar peg pushed the yuan to 6.7971 on Monday from 6.8272 yuan on Friday. It was a shift of 0.4 percent and an abrupt break from the narrow range around 6.83 yuan to $1 that had held since mid-2008.
The central bank still sets the exchange rate each day before the start of trading and limits daily fluctuations to 0.5-percent. Its announcement late Saturday stressed China's commitment to keeping the currency stable.
Allowing greater flexibility suits China's own needs. Apart from helping Beijing fight inflation, it should encourage manufacturers to improve efficiency and reduce the country's reliance on exports as a driver for growth, the central bank said.
By ruling out any one-time major revaluations, the People's Bank of China also doused speculation over such moves and removed a source of uncertainty for investors. China's share market responded by jumping nearly 3 percent Monday.
"China has to keep the currency stable under the current circumstances and will certainly take any consequences of the yuan's appreciation very seriously," Yi said.
The decision to revert to a basket of currencies including the U.S. dollar, rather than the dollar alone, to set the exchange rate restores policies in place before the global downturn walloped Chinese manufacturers in 2008. Millions lost their jobs.
China had set up the basket-linked exchange rate system in July 2005, allowing the yuan to gradually gain nearly 20 percent until the financial crisis hit.
China's economy surged 11.9 percent in the first quarter of this year, and exports jumped by nearly 50 percent over a year earlier in May. That was despite expectations that Europe's debt crisis would hit demand in the 27-nation European Union, China's biggest trading partner.
Such trends raised expectations that China would adjust policies that critics say keep the yuan undervalued, unfairly holding down prices of Chinese products overseas and making them impossible to compete with. Beijing's gradual approach to currency reform is a perennial bugaboo in relations with Washington.
U.S. Treasury Secretary Timothy Geithner's immediate praise for the central bank's announcement suggests the move was coordinated to allow him to release a report on China's currency, postponed for more than two months, without having to accuse Beijing of manipulating its currency, Qian Wang, an economist at J.P.Morgan, said in a note to clients.
Geithner delayed the release of the report to allow more time for talks with the Chinese, and the shift in policy is viewed by many as a concession by Beijing.
But President Barack Obama's administration still faces pressure from Congress to name China a currency manipulator, a designation that could potentially lead to U.S. trade sanctions.
"The window was closing for China to act before China-U.S. relations get even more politically charged heading into the U.S. midterm election," Wang said, referring to November's congressional elections.
Though Chinese exporters already operating on razor-thin margins will have to find new ways to stay competitive, the central bank -- echoing many economists -- noted that such changes are crucial for more balanced, sustainable growth that is less reliant on exports.
"The exchange rate problem is one we would have to face sooner or later," said Bai Ming, deputy general manager of Zhejiang Mingfeng Car Accesories Co., which exports car covers to the Americas, Europe and South Korea.
"What we are trying to do is to raise productivity and save costs. We cannot just sit back," he said.
But while it has prescribed a small dose of currency flexibility for its own economic health, China still rejects accusations that its currency regime is a major cause of huge trade imbalances that contributed to the global crisis.
G-20 leaders should focus on more urgent global reforms, said a commentary Monday by the official Xinhua News Agency.
"If they cannot make good use of the coming G-20 summit to press ahead with the much-needed overhaul of the global financial system, the international community will soon find to its disappointment that its leaders look only for red herrings, rather than real solutions, at a time when true leadership is badly needed," it said.
Associated Press researchers Bonnie Cao in Beijing and Ji Chen in Shanghai contributed to this report.
SHANGHAI (AP) -- By loosening its currency's peg to the dollar, China is seeking to defuse complaints that it keeps its exports artificially cheap, strengthen its hand against inflation and ensure its economy can keep growing at a healthy pace.
The Chinese yuan surged to a record high Monday as Beijing delivered on its central bank's weekend promise of greater flexibility in its exchange rates. World shares rallied as investors took heart from the signal of confidence in China's resilience.
Analysts said the move was not a major shift in foreign policy. They described it instead as a maneuver aimed mainly at countering criticism of Beijing's currency policies before this weekend's summit of the Group of 20 leading economies. Beijing's trading partners have been frustrated by their perennial trade imbalances with China.
"This is a type of 'diplomatese' before the G-20," said Yi Xianrong, a prominent economist at the Institute of Finance in the Chinese Academy of Social Sciences, a government think-tank.
But Beijing's decision to give up the dollar link it imposed two years ago to help its exporters during the recession also shows it recognizes the need for flexibility in its own economic policies.
China's large trade surpluses oblige the central bank to intervene in the exchange market: It buys up excess foreign exchange earnings to keep the yuan's value from rising. Greater flexibility will allow more leeway in China's monetary policies, helping it counter inflation.
"Chinese policymakers are attempting to engineer a scenario that maximizes political goodwill while at the same time minimizes any negative economic impact," said Alaistair Chan, an economist at Moody's Analytics in Sydney.
The shift away from the dollar peg pushed the yuan to 6.7971 on Monday from 6.8272 yuan on Friday. It was a shift of 0.4 percent and an abrupt break from the narrow range around 6.83 yuan to $1 that had held since mid-2008.
The central bank still sets the exchange rate each day before the start of trading and limits daily fluctuations to 0.5-percent. Its announcement late Saturday stressed China's commitment to keeping the currency stable.
Allowing greater flexibility suits China's own needs. Apart from helping Beijing fight inflation, it should encourage manufacturers to improve efficiency and reduce the country's reliance on exports as a driver for growth, the central bank said.
By ruling out any one-time major revaluations, the People's Bank of China also doused speculation over such moves and removed a source of uncertainty for investors. China's share market responded by jumping nearly 3 percent Monday.
"China has to keep the currency stable under the current circumstances and will certainly take any consequences of the yuan's appreciation very seriously," Yi said.
The decision to revert to a basket of currencies including the U.S. dollar, rather than the dollar alone, to set the exchange rate restores policies in place before the global downturn walloped Chinese manufacturers in 2008. Millions lost their jobs.
China had set up the basket-linked exchange rate system in July 2005, allowing the yuan to gradually gain nearly 20 percent until the financial crisis hit.
China's economy surged 11.9 percent in the first quarter of this year, and exports jumped by nearly 50 percent over a year earlier in May. That was despite expectations that Europe's debt crisis would hit demand in the 27-nation European Union, China's biggest trading partner.
Such trends raised expectations that China would adjust policies that critics say keep the yuan undervalued, unfairly holding down prices of Chinese products overseas and making them impossible to compete with. Beijing's gradual approach to currency reform is a perennial bugaboo in relations with Washington.
U.S. Treasury Secretary Timothy Geithner's immediate praise for the central bank's announcement suggests the move was coordinated to allow him to release a report on China's currency, postponed for more than two months, without having to accuse Beijing of manipulating its currency, Qian Wang, an economist at J.P.Morgan, said in a note to clients.
Geithner delayed the release of the report to allow more time for talks with the Chinese, and the shift in policy is viewed by many as a concession by Beijing.
But President Barack Obama's administration still faces pressure from Congress to name China a currency manipulator, a designation that could potentially lead to U.S. trade sanctions.
"The window was closing for China to act before China-U.S. relations get even more politically charged heading into the U.S. midterm election," Wang said, referring to November's congressional elections.
Though Chinese exporters already operating on razor-thin margins will have to find new ways to stay competitive, the central bank -- echoing many economists -- noted that such changes are crucial for more balanced, sustainable growth that is less reliant on exports.
"The exchange rate problem is one we would have to face sooner or later," said Bai Ming, deputy general manager of Zhejiang Mingfeng Car Accesories Co., which exports car covers to the Americas, Europe and South Korea.
"What we are trying to do is to raise productivity and save costs. We cannot just sit back," he said.
But while it has prescribed a small dose of currency flexibility for its own economic health, China still rejects accusations that its currency regime is a major cause of huge trade imbalances that contributed to the global crisis.
G-20 leaders should focus on more urgent global reforms, said a commentary Monday by the official Xinhua News Agency.
"If they cannot make good use of the coming G-20 summit to press ahead with the much-needed overhaul of the global financial system, the international community will soon find to its disappointment that its leaders look only for red herrings, rather than real solutions, at a time when true leadership is badly needed," it said.
Associated Press researchers Bonnie Cao in Beijing and Ji Chen in Shanghai contributed to this report.
FA...Stocks erase gains after traders re-examine China's plan to let yuan appreciate against dollar
Tim Paradis, AP Business Writers, On Monday June 21, 2010, 5:49 pm EDT
NEW YORK (AP) -- Stocks erased big gains Monday after investors lost some of their enthusiasm about China's decision to let its currency appreciate against the dollar.
The Dow Jones industrial average fell about 8 points after climbing nearly 144 in early trading. The Dow had been up the past four days. The Standard & Poor's 500 index also slid and the Nasdaq composite index fell after seven straight gains.
The initial reaction to China's weekend announcement was that a stronger yuan compared with the dollar would allow U.S. manufacturers and exporters to be more competitive selling their products in China. But traders came to see the move as more of a long-term shift rather than something that would give the economy a boost now.
A drop in the euro also eroded investors' excitement over China's move. A slide in the European currency is seen as a sign of faltering confidence in Europe's ability to contain its debt problems.
Many of China's trading partners complain that the country keeps the yuan artificially low to bolster exports. At the same time, the weak currency makes imported goods expensive for consumers in China. Subodh Kumar, an independent investment strategist in Toronto, said some traders at first mistakenly expected to see a lower yuan make demand from China jump the way it did in 2008 when the country enacted a massive economic stimulus plan.
"The notion is that they're going to get the same kick out of China that they did in 2008," Kumar said. "Most of China's moves are long-term."
But materials companies rose on expectations that demand from China will increase. Aluminum producer Alcoa Inc. gained 5.5 percent, while mining company Cliffs Natural Resources Inc. rose 3 percent.
The news from China hurt retailers because the country's imports would become more expensive. That could cut into earnings, especially since weak consumer spending limits' stores ability to pass higher prices on to their customers. Macy's Inc. fell 3.4 percent, while Wal-Mart Stores Inc. dropped 1 percent.
The focus on China and the euro came on a quiet day with little other news. Light trading volume signaled that many investors were staying out of the market. Traders are looking to a two-day meeting of the Federal Reserve that begins Tuesday. The Fed is expected to keep the federal funds rate, its benchmark interest rate, at historic lows. Traders will be focused on the Fed's assessment of the economy.
The light flow of news left the market vulnerable to more of the big swings that have been common since major stock indexes hit 2010 highs in late April.
"There's nothing down there to move it except rumor and innuendo and traders trying to book a few profits before the end of the day," said James Paulsen, chief investment strategist for Wells Capital Management in Minneapolis, referring to sentiment on trading floors.
The Dow fell 8.23, or 0.1 percent, to 10,442.41. The index had risen 5.2 percent in the past two weeks, its biggest two-week gain since mid-November 2009.
The S&P 500 index fell 4.31, or 0.4 percent, to 1,113.20, and the Nasdaq fell 20.71, or 0.9 percent, to 2,289.09.
Treasury prices fell but were off their lows, while interest rates moved higher. Falling stocks sent more traders searching for the safety of government debt. The yield on the 10-year Treasury note rose to 3.25 percent from 3.23 percent late Friday.
The dollar rose against other major currencies and the euro fell.
Prices for many commodities climbed but ended off their highs. Crude oil rose 64 cents to $77.82 per barrel on the New York Mercantile Exchange. Gold hit a record $1,266.50 an ounce before settling down $17.60 at $1,240.70 an ounce. Copper jumped.
Anadarko Petroleum Corp. rose 88 cents, or 2.1 percent, to $43.45, while Freeport-McMoRan Copper & Gold Inc. rose $2.18, or 3.3 percent, to $68.08.
Alcoa rose 61 cents, or 5.5 percent, to $11.72, while Cliffs Natural Resources rose $1.67, or 3 percent, to $57.89.
A profit warning from California Pizza Kitchen Inc. because of weaker-than-expected sales renewed concerns that consumers will continue to hold back spending while they worry about jobs. California Pizza Kitchen fell $2.06, or 10.9 percent, to $16.83.
Macy's fell 72 cents, or 3.4 percent, to $20.74, while Abercrombie & Fitch dropped 82 cents, or 2.3 percent, to $34.51.
Three stocks fell for every two that rose on the New York Stock Exchange, where consolidated volume came to 4.5 billion shares, compared with 4.9 billion Friday.
The Russell 2000 index of smaller companies fell 6.89, or 1 percent, to 660.03.
Overseas markets jumped following China's announcement. They held on to their gains because they closed earlier than U.S. markets. Britain's FTSE 100 rose 0.9 percent, Germany's DAX index added 1.2 percent, and France's CAC-40 climbed 1.3 percent. Japan's Nikkei stock average rose 2.4 percent, while Hong Kong's Hang Seng jumped 3.1 percent.
NEW YORK (AP) -- Stocks erased big gains Monday after investors lost some of their enthusiasm about China's decision to let its currency appreciate against the dollar.
The Dow Jones industrial average fell about 8 points after climbing nearly 144 in early trading. The Dow had been up the past four days. The Standard & Poor's 500 index also slid and the Nasdaq composite index fell after seven straight gains.
The initial reaction to China's weekend announcement was that a stronger yuan compared with the dollar would allow U.S. manufacturers and exporters to be more competitive selling their products in China. But traders came to see the move as more of a long-term shift rather than something that would give the economy a boost now.
A drop in the euro also eroded investors' excitement over China's move. A slide in the European currency is seen as a sign of faltering confidence in Europe's ability to contain its debt problems.
Many of China's trading partners complain that the country keeps the yuan artificially low to bolster exports. At the same time, the weak currency makes imported goods expensive for consumers in China. Subodh Kumar, an independent investment strategist in Toronto, said some traders at first mistakenly expected to see a lower yuan make demand from China jump the way it did in 2008 when the country enacted a massive economic stimulus plan.
"The notion is that they're going to get the same kick out of China that they did in 2008," Kumar said. "Most of China's moves are long-term."
But materials companies rose on expectations that demand from China will increase. Aluminum producer Alcoa Inc. gained 5.5 percent, while mining company Cliffs Natural Resources Inc. rose 3 percent.
The news from China hurt retailers because the country's imports would become more expensive. That could cut into earnings, especially since weak consumer spending limits' stores ability to pass higher prices on to their customers. Macy's Inc. fell 3.4 percent, while Wal-Mart Stores Inc. dropped 1 percent.
The focus on China and the euro came on a quiet day with little other news. Light trading volume signaled that many investors were staying out of the market. Traders are looking to a two-day meeting of the Federal Reserve that begins Tuesday. The Fed is expected to keep the federal funds rate, its benchmark interest rate, at historic lows. Traders will be focused on the Fed's assessment of the economy.
The light flow of news left the market vulnerable to more of the big swings that have been common since major stock indexes hit 2010 highs in late April.
"There's nothing down there to move it except rumor and innuendo and traders trying to book a few profits before the end of the day," said James Paulsen, chief investment strategist for Wells Capital Management in Minneapolis, referring to sentiment on trading floors.
The Dow fell 8.23, or 0.1 percent, to 10,442.41. The index had risen 5.2 percent in the past two weeks, its biggest two-week gain since mid-November 2009.
The S&P 500 index fell 4.31, or 0.4 percent, to 1,113.20, and the Nasdaq fell 20.71, or 0.9 percent, to 2,289.09.
Treasury prices fell but were off their lows, while interest rates moved higher. Falling stocks sent more traders searching for the safety of government debt. The yield on the 10-year Treasury note rose to 3.25 percent from 3.23 percent late Friday.
The dollar rose against other major currencies and the euro fell.
Prices for many commodities climbed but ended off their highs. Crude oil rose 64 cents to $77.82 per barrel on the New York Mercantile Exchange. Gold hit a record $1,266.50 an ounce before settling down $17.60 at $1,240.70 an ounce. Copper jumped.
Anadarko Petroleum Corp. rose 88 cents, or 2.1 percent, to $43.45, while Freeport-McMoRan Copper & Gold Inc. rose $2.18, or 3.3 percent, to $68.08.
Alcoa rose 61 cents, or 5.5 percent, to $11.72, while Cliffs Natural Resources rose $1.67, or 3 percent, to $57.89.
A profit warning from California Pizza Kitchen Inc. because of weaker-than-expected sales renewed concerns that consumers will continue to hold back spending while they worry about jobs. California Pizza Kitchen fell $2.06, or 10.9 percent, to $16.83.
Macy's fell 72 cents, or 3.4 percent, to $20.74, while Abercrombie & Fitch dropped 82 cents, or 2.3 percent, to $34.51.
Three stocks fell for every two that rose on the New York Stock Exchange, where consolidated volume came to 4.5 billion shares, compared with 4.9 billion Friday.
The Russell 2000 index of smaller companies fell 6.89, or 1 percent, to 660.03.
Overseas markets jumped following China's announcement. They held on to their gains because they closed earlier than U.S. markets. Britain's FTSE 100 rose 0.9 percent, Germany's DAX index added 1.2 percent, and France's CAC-40 climbed 1.3 percent. Japan's Nikkei stock average rose 2.4 percent, while Hong Kong's Hang Seng jumped 3.1 percent.
Monday, June 21, 2010
An iconic wall will fall at 10 tonight
An iconic wall will fall at 10 tonight
KUALA LUMPUR: When the clock strikes 10 tonight, the 394-metre long wall of Pudu Prison fronting Jalan Pudu will be demolished after having served its purpose for the past 100 years.
Construction on the wall, also known as Pudu Gaol, started in 1891 in Jalan Hang Tuah and it was fully completed in 1895 at a cost of RM15,360.90.
The 4.5m high wall had once set a record for the longest mural in the world (384m). It will be torn down to make way for a road-widening project, including the construction of an underpass.
A section of Pudu Prison wall fronting Jalan Pudu in Kuala Lumpur is expected to be demolished tonight. The 394m wall of the prison, built in 1895 and closed in 1996, was once famous for having the longest mural in the world at 384m. The wall will make way for a road-widening project to ease traffic congestion in the city centre. - BRIAN MOH / The Star
The prison stopped operating in 1996 when the building could no longer cater to the high volume of up to 6,550 people at a time since 1985.
The prisoners were subsequently shifted to the Sungai Buloh Prison, 36km from here.
The rest of the prison, which sits amid flourishing development in the Bukit Bintang’s Golden Triangle, will remain for now, but the site has been earmarked for a mega development project.
A passer-by taking pictures of the wall with death sentence warning to drug traffickers. - BRIAN MOH / The Star
Last night, a group of activists gathered in front of the city’s iconic building to say “goodbye”. Some even performed Chinese funeral rites including breaking ceramic bowls and burning paper offerings.
A participant, who only wanted to be identified as Min Lik, said the group was not there to protest against the demolition but to mourn its “passing”.
“Pudu Jail is part of Kuala Lumpur’s landscape and it is a major heritage building for the city,” she said.
End of an era: A pile of paper money is burnt as a symbolic gesture to the ‘death’ of Pudu Jail by a few Malaysians who are calling for the preservation of the historical landmark.
A Pudu resident, however, said the jail should go. He said a promoter tried to open up the prison for tourists but stopped because the response was poor. “It’s a waste for an unused prison to sit in middle of the city,” he said, adding that he did not see any heritage value.
Businessman Lim Beng Tat, 47, drove from Kajang to take some photographs with his family at the front of the building.
“It’s sad to see this iconic building go,” he said.
Prabu Munusamy, 32, who was met near the area, expressed disappointment over the pending demolition, saying the prison complex could be a valuable tourist attraction.
“This prison had housed several prominent convicts,” he said.
Chew Chong Huai, 52, said he was saddened that a building with such historical value would be demolished instead of being preserved as a heritage site. “In other countries, like China for example, historical buildings would be preserved as tourist attractions,” he said.
Irwan Hashim, 32, also disagreed with the move to demolish the prison complex and wall, saying the city was already congested with development.
KUALA LUMPUR: When the clock strikes 10 tonight, the 394-metre long wall of Pudu Prison fronting Jalan Pudu will be demolished after having served its purpose for the past 100 years.
Construction on the wall, also known as Pudu Gaol, started in 1891 in Jalan Hang Tuah and it was fully completed in 1895 at a cost of RM15,360.90.
The 4.5m high wall had once set a record for the longest mural in the world (384m). It will be torn down to make way for a road-widening project, including the construction of an underpass.
A section of Pudu Prison wall fronting Jalan Pudu in Kuala Lumpur is expected to be demolished tonight. The 394m wall of the prison, built in 1895 and closed in 1996, was once famous for having the longest mural in the world at 384m. The wall will make way for a road-widening project to ease traffic congestion in the city centre. - BRIAN MOH / The Star
The prison stopped operating in 1996 when the building could no longer cater to the high volume of up to 6,550 people at a time since 1985.
The prisoners were subsequently shifted to the Sungai Buloh Prison, 36km from here.
The rest of the prison, which sits amid flourishing development in the Bukit Bintang’s Golden Triangle, will remain for now, but the site has been earmarked for a mega development project.
A passer-by taking pictures of the wall with death sentence warning to drug traffickers. - BRIAN MOH / The Star
Last night, a group of activists gathered in front of the city’s iconic building to say “goodbye”. Some even performed Chinese funeral rites including breaking ceramic bowls and burning paper offerings.
A participant, who only wanted to be identified as Min Lik, said the group was not there to protest against the demolition but to mourn its “passing”.
“Pudu Jail is part of Kuala Lumpur’s landscape and it is a major heritage building for the city,” she said.
End of an era: A pile of paper money is burnt as a symbolic gesture to the ‘death’ of Pudu Jail by a few Malaysians who are calling for the preservation of the historical landmark.
A Pudu resident, however, said the jail should go. He said a promoter tried to open up the prison for tourists but stopped because the response was poor. “It’s a waste for an unused prison to sit in middle of the city,” he said, adding that he did not see any heritage value.
Businessman Lim Beng Tat, 47, drove from Kajang to take some photographs with his family at the front of the building.
“It’s sad to see this iconic building go,” he said.
Prabu Munusamy, 32, who was met near the area, expressed disappointment over the pending demolition, saying the prison complex could be a valuable tourist attraction.
“This prison had housed several prominent convicts,” he said.
Chew Chong Huai, 52, said he was saddened that a building with such historical value would be demolished instead of being preserved as a heritage site. “In other countries, like China for example, historical buildings would be preserved as tourist attractions,” he said.
Irwan Hashim, 32, also disagreed with the move to demolish the prison complex and wall, saying the city was already congested with development.
Don't Waste Your Cancer
John Piper
I write this on the eve of prostate surgery. I believe in God's power to heal—by miracle and by medicine. I believe it is right and good to pray for both kinds of healing. Cancer is not wasted when it is healed by God. He gets the glory and that is why cancer exists. So not to pray for healing may waste your cancer. But healing is not God's plan for everyone. And there are many other ways to waste your cancer. I am praying for myself and for you that we will not waste this pain.
1. You will waste your cancer if you do not believe it is designed for you by God.
It will not do to say that God only uses our cancer but does not design it. What God permits, he permits for a reason. And that reason is his design. If God foresees molecular developments becoming cancer, he can stop it or not. If he does not, he has a purpose. Since he is infinitely wise, it is right to call this purpose a design. Satan is real and causes many pleasures and pains. But he is not ultimate. So when he strikes Job with boils (Job 2:7), Job attributes it ultimately to God (2:10) and the inspired writer agrees: "They . . . comforted him for all the evil that the LORD had brought upon him" (Job 42:11). If you don't believe your cancer is designed for you by God, you will waste it.
2. You will waste your cancer if you believe it is a curse and not a gift.
"There is therefore now no condemnation for those who are in Christ Jesus" (Romans 8:1). "Christ redeemed us from the curse of the law by becoming a curse for us" (Galatians 3:13). "There is no enchantment against Jacob, no divination against Israel" (Numbers 23:23). "The LORD God is a sun and shield; the LORD bestows favor and honor. No good thing does he withhold from those who walk uprightly" (Psalm 84:11).
3. You will waste your cancer if you seek comfort from your odds rather than from God.
The design of God in your cancer is not to train you in the rationalistic, human calculation of odds. The world gets comfort from their odds. Not Christians. Some count their chariots (percentages of survival) and some count their horses (side effects of treatment), but we trust in the name of the LORD our God (Psalm 20:7). God's design is clear from 2 Corinthians 1:9, "We felt that we had received the sentence of death. But that was to make us rely not on ourselves but on God who raises the dead." The aim of God in your cancer (among a thousand other good things) is to knock props out from under our hearts so that we rely utterly on him.
4. You will waste your cancer if you refuse to think about death.
We will all die, if Jesus postpones his return. Not to think about what it will be like to leave this life and meet God is folly. Ecclesiastes 7:2 says, "It is better to go to the house of mourning [a funeral] than to go to the house of feasting, for this is the end of all mankind, and the living will lay it to heart." How can you lay it to heart if you won't think about it? Psalm 90:12 says, "Teach us to number our days that we may get a heart of wisdom." Numbering your days means thinking about how few there are and that they will end. How will you get a heart of wisdom if you refuse to think about this? What a waste, if we do not think about death.
5. You will waste your cancer if you think that "beating" cancer means staying alive rather than cherishing Christ.
Satan's and God's designs in your cancer are not the same. Satan designs to destroy your love for Christ. God designs to deepen your love for Christ. Cancer does not win if you die. It wins if you fail to cherish Christ. God's design is to wean you off the breast of the world and feast you on the sufficiency of Christ. It is meant to help you say and feel, "I count everything as loss because of the surpassing worth of knowing Christ Jesus my Lord." And to know that therefore, "To live is Christ, and to die is gain" (Philippians 3:8; 1:21).
6. You will waste your cancer if you spend too much time reading about cancer and not enough time reading about God.
It is not wrong to know about cancer. Ignorance is not a virtue. But the lure to know more and more and the lack of zeal to know God more and more is symptomatic of unbelief. Cancer is meant to waken us to the reality of God. It is meant to put feeling and force behind the command, "Let us know; let us press on to know the LORD" (Hosea 6:3). It is meant to waken us to the truth of Daniel 11:32, "The people who know their God shall stand firm and take action." It is meant to make unshakable, indestructible oak trees out of us: "His delight is in the law of the LORD, and on his law he meditates day and night. He is like a tree planted by streams of water that yields its fruit in its season, and its leaf does not wither. In all that he does, he prospers" (Psalm 1:2). What a waste of cancer if we read day and night about cancer and not about God.
7. You will waste your cancer if you let it drive you into solitude instead of deepen your relationships with manifest affection.
When Epaphroditus brought the gifts to Paul sent by the Philippian church he became ill and almost died. Paul tells the Philippians, "He has been longing for you all and has been distressed because you heard that he was ill" (Philippians 2:26-27). What an amazing response! It does not say they were distressed that he was ill, but that he was distressed because they heard he was ill. That is the kind of heart God is aiming to create with cancer: a deeply affectionate, caring heart for people. Don't waste your cancer by retreating into yourself.
8. You will waste your cancer if you grieve as those who have no hope.
Paul used this phrase in relation to those whose loved ones had died: "We do not want you to be uninformed, brothers, about those who are asleep, that you may not grieve as others do who have no hope" (1 Thessalonians 4:13). There is a grief at death. Even for the believer who dies, there is temporary loss—loss of body, and loss of loved ones here, and loss of earthly ministry. But the grief is different—it is permeated with hope. "We would rather be away from the body and at home with the Lord" (2 Corinthians 5:8). Don't waste your cancer grieving as those who don't have this hope.
9. You will waste your cancer if you treat sin as casually as before.
Are your besetting sins as attractive as they were before you had cancer? If so you are wasting your cancer. Cancer is designed to destroy the appetite for sin. Pride, greed, lust, hatred, unforgiveness, impatience, laziness, procrastination—all these are the adversaries that cancer is meant to attack. Don't just think of battling against cancer. Also think of battling with cancer. All these things are worse enemies than cancer. Don't waste the power of cancer to crush these foes. Let the presence of eternity make the sins of time look as futile as they really are. "What does it profit a man if he gains the whole world and loses or forfeits himself?" (Luke 9:25).
10. You will waste your cancer if you fail to use it as a means of witness to the truth and glory of Christ.
Christians are never anywhere by divine accident. There are reasons for why we wind up where we do. Consider what Jesus said about painful, unplanned circumstances: "They will lay their hands on you and persecute you, delivering you up to the synagogues and prisons, and you will be brought before kings and governors for my name's sake. This will be your opportunity to bear witness" (Luke 21:12 -13). So it is with cancer. This will be an opportunity to bear witness. Christ is infinitely worthy. Here is a golden opportunity to show that he is worth more than life. Don't waste it.
Remember you are not left alone. You will have the help you need. "My God will supply every need of yours according to his riches in glory in Christ Jesus" (Philippians 4:19).
By John Piper. © Desiring God. Website: www.desiringGod.org. Email: mail@desiringGod.org. Toll Free: 1.888.346.4700.
I write this on the eve of prostate surgery. I believe in God's power to heal—by miracle and by medicine. I believe it is right and good to pray for both kinds of healing. Cancer is not wasted when it is healed by God. He gets the glory and that is why cancer exists. So not to pray for healing may waste your cancer. But healing is not God's plan for everyone. And there are many other ways to waste your cancer. I am praying for myself and for you that we will not waste this pain.
1. You will waste your cancer if you do not believe it is designed for you by God.
It will not do to say that God only uses our cancer but does not design it. What God permits, he permits for a reason. And that reason is his design. If God foresees molecular developments becoming cancer, he can stop it or not. If he does not, he has a purpose. Since he is infinitely wise, it is right to call this purpose a design. Satan is real and causes many pleasures and pains. But he is not ultimate. So when he strikes Job with boils (Job 2:7), Job attributes it ultimately to God (2:10) and the inspired writer agrees: "They . . . comforted him for all the evil that the LORD had brought upon him" (Job 42:11). If you don't believe your cancer is designed for you by God, you will waste it.
2. You will waste your cancer if you believe it is a curse and not a gift.
"There is therefore now no condemnation for those who are in Christ Jesus" (Romans 8:1). "Christ redeemed us from the curse of the law by becoming a curse for us" (Galatians 3:13). "There is no enchantment against Jacob, no divination against Israel" (Numbers 23:23). "The LORD God is a sun and shield; the LORD bestows favor and honor. No good thing does he withhold from those who walk uprightly" (Psalm 84:11).
3. You will waste your cancer if you seek comfort from your odds rather than from God.
The design of God in your cancer is not to train you in the rationalistic, human calculation of odds. The world gets comfort from their odds. Not Christians. Some count their chariots (percentages of survival) and some count their horses (side effects of treatment), but we trust in the name of the LORD our God (Psalm 20:7). God's design is clear from 2 Corinthians 1:9, "We felt that we had received the sentence of death. But that was to make us rely not on ourselves but on God who raises the dead." The aim of God in your cancer (among a thousand other good things) is to knock props out from under our hearts so that we rely utterly on him.
4. You will waste your cancer if you refuse to think about death.
We will all die, if Jesus postpones his return. Not to think about what it will be like to leave this life and meet God is folly. Ecclesiastes 7:2 says, "It is better to go to the house of mourning [a funeral] than to go to the house of feasting, for this is the end of all mankind, and the living will lay it to heart." How can you lay it to heart if you won't think about it? Psalm 90:12 says, "Teach us to number our days that we may get a heart of wisdom." Numbering your days means thinking about how few there are and that they will end. How will you get a heart of wisdom if you refuse to think about this? What a waste, if we do not think about death.
5. You will waste your cancer if you think that "beating" cancer means staying alive rather than cherishing Christ.
Satan's and God's designs in your cancer are not the same. Satan designs to destroy your love for Christ. God designs to deepen your love for Christ. Cancer does not win if you die. It wins if you fail to cherish Christ. God's design is to wean you off the breast of the world and feast you on the sufficiency of Christ. It is meant to help you say and feel, "I count everything as loss because of the surpassing worth of knowing Christ Jesus my Lord." And to know that therefore, "To live is Christ, and to die is gain" (Philippians 3:8; 1:21).
6. You will waste your cancer if you spend too much time reading about cancer and not enough time reading about God.
It is not wrong to know about cancer. Ignorance is not a virtue. But the lure to know more and more and the lack of zeal to know God more and more is symptomatic of unbelief. Cancer is meant to waken us to the reality of God. It is meant to put feeling and force behind the command, "Let us know; let us press on to know the LORD" (Hosea 6:3). It is meant to waken us to the truth of Daniel 11:32, "The people who know their God shall stand firm and take action." It is meant to make unshakable, indestructible oak trees out of us: "His delight is in the law of the LORD, and on his law he meditates day and night. He is like a tree planted by streams of water that yields its fruit in its season, and its leaf does not wither. In all that he does, he prospers" (Psalm 1:2). What a waste of cancer if we read day and night about cancer and not about God.
7. You will waste your cancer if you let it drive you into solitude instead of deepen your relationships with manifest affection.
When Epaphroditus brought the gifts to Paul sent by the Philippian church he became ill and almost died. Paul tells the Philippians, "He has been longing for you all and has been distressed because you heard that he was ill" (Philippians 2:26-27). What an amazing response! It does not say they were distressed that he was ill, but that he was distressed because they heard he was ill. That is the kind of heart God is aiming to create with cancer: a deeply affectionate, caring heart for people. Don't waste your cancer by retreating into yourself.
8. You will waste your cancer if you grieve as those who have no hope.
Paul used this phrase in relation to those whose loved ones had died: "We do not want you to be uninformed, brothers, about those who are asleep, that you may not grieve as others do who have no hope" (1 Thessalonians 4:13). There is a grief at death. Even for the believer who dies, there is temporary loss—loss of body, and loss of loved ones here, and loss of earthly ministry. But the grief is different—it is permeated with hope. "We would rather be away from the body and at home with the Lord" (2 Corinthians 5:8). Don't waste your cancer grieving as those who don't have this hope.
9. You will waste your cancer if you treat sin as casually as before.
Are your besetting sins as attractive as they were before you had cancer? If so you are wasting your cancer. Cancer is designed to destroy the appetite for sin. Pride, greed, lust, hatred, unforgiveness, impatience, laziness, procrastination—all these are the adversaries that cancer is meant to attack. Don't just think of battling against cancer. Also think of battling with cancer. All these things are worse enemies than cancer. Don't waste the power of cancer to crush these foes. Let the presence of eternity make the sins of time look as futile as they really are. "What does it profit a man if he gains the whole world and loses or forfeits himself?" (Luke 9:25).
10. You will waste your cancer if you fail to use it as a means of witness to the truth and glory of Christ.
Christians are never anywhere by divine accident. There are reasons for why we wind up where we do. Consider what Jesus said about painful, unplanned circumstances: "They will lay their hands on you and persecute you, delivering you up to the synagogues and prisons, and you will be brought before kings and governors for my name's sake. This will be your opportunity to bear witness" (Luke 21:12 -13). So it is with cancer. This will be an opportunity to bear witness. Christ is infinitely worthy. Here is a golden opportunity to show that he is worth more than life. Don't waste it.
Remember you are not left alone. You will have the help you need. "My God will supply every need of yours according to his riches in glory in Christ Jesus" (Philippians 4:19).
By John Piper. © Desiring God. Website: www.desiringGod.org. Email: mail@desiringGod.org. Toll Free: 1.888.346.4700.
God Knows Our Needs
Philippians 4:10-19
Today's passage presents an interesting paradox. Paul promises the Philippians that God will supply all their needs (v. 19) yet admits that he has experienced times of want (v. 12). To reconcile these two statements, let's consider God's divine viewpoint.
Paul wrote these words from a prison cell—a place of great physical discomfort. From a human perspective, we would all agree that God should have provided for Paul by relieving his suffering. But instead, the Lord taught him contentment in this difficult situation. Although his physical discomfort remained, a greater need for a changed attitude was met.
A change of heart toward ongoing suffering is a huge challenge. On our own, it's impossible, but the Lord promises to strengthen us through Christ. By living in dependence and submission to Him, we gain His power to overcome our negative, sinful attitudes and learn contentment in all kinds of situations.
Our problem is not that the Lord won't provide for us, but that we so often fail to understand what our deepest needs are. God sees from an unlimited perspective and works for our eternal good, providing for us according to His good purposes from the limitless supply of "His riches in glory."
Instead of merely pleading with God to take away your difficulty, try asking Him to strengthen you through it. Although He may not always deliver you from trials, you can count on Him to work in you to produce contentment, no matter what your external needs may be.
For more biblical teaching and resources from Dr. Charles Stanley, please visit www.intouch.org.
Today's passage presents an interesting paradox. Paul promises the Philippians that God will supply all their needs (v. 19) yet admits that he has experienced times of want (v. 12). To reconcile these two statements, let's consider God's divine viewpoint.
Paul wrote these words from a prison cell—a place of great physical discomfort. From a human perspective, we would all agree that God should have provided for Paul by relieving his suffering. But instead, the Lord taught him contentment in this difficult situation. Although his physical discomfort remained, a greater need for a changed attitude was met.
A change of heart toward ongoing suffering is a huge challenge. On our own, it's impossible, but the Lord promises to strengthen us through Christ. By living in dependence and submission to Him, we gain His power to overcome our negative, sinful attitudes and learn contentment in all kinds of situations.
Our problem is not that the Lord won't provide for us, but that we so often fail to understand what our deepest needs are. God sees from an unlimited perspective and works for our eternal good, providing for us according to His good purposes from the limitless supply of "His riches in glory."
Instead of merely pleading with God to take away your difficulty, try asking Him to strengthen you through it. Although He may not always deliver you from trials, you can count on Him to work in you to produce contentment, no matter what your external needs may be.
For more biblical teaching and resources from Dr. Charles Stanley, please visit www.intouch.org.
Saturday, June 19, 2010
FA...Dow Jones industrial average posts its biggest two-week gain since last November
Tim Paradis and Seth Sutel, AP Business Writer, On Friday June 18, 2010, 6:07 pm EDT
NEW YORK (AP) -- Here's something for investors beaten down by the market's sharp declines this spring: The Dow Jones industrial average just had its best two weeks since November.
The Dow's gain of 16 points on Friday was relatively modest, but it capped a surge of 5.2 percent over the past two weeks that puts the average nearly halfway back to the high for the year that it reached on April 26.
Stocks had a longer winning streak earlier this year, an eight-week stretch that ended in late April, but those gains were more gradual. Then a sharp drop in May and early June brought the Dow down as much as 12.4 percent below its 2010 high, a decline that market analysts call a "correction."
The debate now is focusing on whether that correction phase is over. A correction is generally considered a drop of 10-20 percent from a recent peak. The Dow has risen back 6.5 percent from its lowest close of the year on June 7, but it's still down 6.7 percent from its 2010 high.
"I don't know that we're totally through the correction," said Stu Schweitzer, global markets strategist at JPMorgan's Private Bank in New York. "I do expect markets to remain quite volatile all through the rest of this year, but I still expect that we're going to end the year higher."
Minerals companies led other shares higher after gold settled at another record high. Barrick Gold Corp. jumped 3.5 percent, while Newmont Mining Corp. rose 2.6 percent.
Corporate news also brought out buyers. CVS Caremark Corp. rose 1.9 percent and Walgreen Co. rose 2.8 percent after the two companies settled a dispute over pharmacy prescriptions that had threatened to hurt profits. Dow component Caterpillar Inc. gained 1.4 percent after reporting sharply higher sales.
The Dow rose 16.47, or 0.2 percent, to close at 10,450.64. The broader Standard & Poor's 500 index rose 1.47, or 0.1 percent, to 1,117.51. The Nasdaq composite index edged up 2.64, or 0.1 percent, to 2,309.80.
All three indicators posted solid gains for the week. The Dow is up 2.3 percent, the S&P 500 2.4 percent and the Nasdaq 3 percent.
The Dow posted its second consecutive weekly gain of more than 2 percent. Before that, the Dow had been down for three weeks. The last time the Dow had a two-week stretch of gains that strong was in November 2009.
Advancing stocks narrowly outpaced those that fell on the New York Stock Exchange, where consolidated volume came to 4.9 billion shares, versus 4.6 billion the day before. Volume was heavier because of the simultaneous expiration of four kinds of futures and options contracts, which occurs once every quarter.
Trading was relatively quiet considering the options and futures expirations, which can often bring volatility as traders adjust their portfolios. The week that follows the June expiration is often a losing one for investors. The Dow has posted a loss during that week for the past 11 years, according to the Stock Trader's Almanac.
Bond prices slipped, pushing interest rates higher. The yield on the benchmark 10-year Treasury note rose to 3.23 percent from 3.20 percent late Thursday.
The dollar edged lower against the British pound and Japanese yen, while the euro edged down versus the dollar. The euro has regained strength over the past week amid encouraging signs in Europe's efforts to control its debt crisis. Spain had successful bond sales this week, and European leaders pledged to disclose the results of stress tests on banks.
Crude oil rose 39 cents to settle at $77.18 per barrel on the New York Mercantile Exchange.
Randy Frederick, director of trading and derivatives at Charles Schwab, said the market's bounce from its recent lows has come too quickly. He said professional traders are building up positions in investments that would cushion their losses if the market fell again.
"Not that we're going into this big ugly bear market but to go back down to the lows that we were at just a few weeks ago, I think, seems very possible based on what I see," Frederick said. "I see a reason to be a little cautious right now."
The coming week brings readings on home sales and consumer sentiment. The Federal Reserve also will meet on interest rates.
Gold settled up $1,258.30 an ounce, a gain of $9.60. Barrick Gold rose $1.56, or 3.5 percent, to $46.38, and Newmont Mining climbed $1.57, or 2.6 percent, to $61.25.
CVS rose 59 cents to $32.43, while Walgreen gained 82 cents to $30.09. Caterpillar gained 90 cents to close at $65.85.
The Russell 2000 index of smaller companies rose 1.07, or 0.2 percent, to 666.92.
NEW YORK (AP) -- Here's something for investors beaten down by the market's sharp declines this spring: The Dow Jones industrial average just had its best two weeks since November.
The Dow's gain of 16 points on Friday was relatively modest, but it capped a surge of 5.2 percent over the past two weeks that puts the average nearly halfway back to the high for the year that it reached on April 26.
Stocks had a longer winning streak earlier this year, an eight-week stretch that ended in late April, but those gains were more gradual. Then a sharp drop in May and early June brought the Dow down as much as 12.4 percent below its 2010 high, a decline that market analysts call a "correction."
The debate now is focusing on whether that correction phase is over. A correction is generally considered a drop of 10-20 percent from a recent peak. The Dow has risen back 6.5 percent from its lowest close of the year on June 7, but it's still down 6.7 percent from its 2010 high.
"I don't know that we're totally through the correction," said Stu Schweitzer, global markets strategist at JPMorgan's Private Bank in New York. "I do expect markets to remain quite volatile all through the rest of this year, but I still expect that we're going to end the year higher."
Minerals companies led other shares higher after gold settled at another record high. Barrick Gold Corp. jumped 3.5 percent, while Newmont Mining Corp. rose 2.6 percent.
Corporate news also brought out buyers. CVS Caremark Corp. rose 1.9 percent and Walgreen Co. rose 2.8 percent after the two companies settled a dispute over pharmacy prescriptions that had threatened to hurt profits. Dow component Caterpillar Inc. gained 1.4 percent after reporting sharply higher sales.
The Dow rose 16.47, or 0.2 percent, to close at 10,450.64. The broader Standard & Poor's 500 index rose 1.47, or 0.1 percent, to 1,117.51. The Nasdaq composite index edged up 2.64, or 0.1 percent, to 2,309.80.
All three indicators posted solid gains for the week. The Dow is up 2.3 percent, the S&P 500 2.4 percent and the Nasdaq 3 percent.
The Dow posted its second consecutive weekly gain of more than 2 percent. Before that, the Dow had been down for three weeks. The last time the Dow had a two-week stretch of gains that strong was in November 2009.
Advancing stocks narrowly outpaced those that fell on the New York Stock Exchange, where consolidated volume came to 4.9 billion shares, versus 4.6 billion the day before. Volume was heavier because of the simultaneous expiration of four kinds of futures and options contracts, which occurs once every quarter.
Trading was relatively quiet considering the options and futures expirations, which can often bring volatility as traders adjust their portfolios. The week that follows the June expiration is often a losing one for investors. The Dow has posted a loss during that week for the past 11 years, according to the Stock Trader's Almanac.
Bond prices slipped, pushing interest rates higher. The yield on the benchmark 10-year Treasury note rose to 3.23 percent from 3.20 percent late Thursday.
The dollar edged lower against the British pound and Japanese yen, while the euro edged down versus the dollar. The euro has regained strength over the past week amid encouraging signs in Europe's efforts to control its debt crisis. Spain had successful bond sales this week, and European leaders pledged to disclose the results of stress tests on banks.
Crude oil rose 39 cents to settle at $77.18 per barrel on the New York Mercantile Exchange.
Randy Frederick, director of trading and derivatives at Charles Schwab, said the market's bounce from its recent lows has come too quickly. He said professional traders are building up positions in investments that would cushion their losses if the market fell again.
"Not that we're going into this big ugly bear market but to go back down to the lows that we were at just a few weeks ago, I think, seems very possible based on what I see," Frederick said. "I see a reason to be a little cautious right now."
The coming week brings readings on home sales and consumer sentiment. The Federal Reserve also will meet on interest rates.
Gold settled up $1,258.30 an ounce, a gain of $9.60. Barrick Gold rose $1.56, or 3.5 percent, to $46.38, and Newmont Mining climbed $1.57, or 2.6 percent, to $61.25.
CVS rose 59 cents to $32.43, while Walgreen gained 82 cents to $30.09. Caterpillar gained 90 cents to close at $65.85.
The Russell 2000 index of smaller companies rose 1.07, or 0.2 percent, to 666.92.
Friday, June 18, 2010
Daytrading tips.....
You are not alone!
--------------------------------------------------------------------------------
Quote:
Originally Posted by jzettel
Okay, So curious If any of you have some tips to help mentally prepare trading a larger account. On my micro I'm able exercise patience and see most trades to profitability. However, on my Mini I get scared and get out too early both on winners and losers. Any words of wisdom to live by?
Thanks,
Jeff
Hello Jeff. Everyone at one time or another feels the same way. One reason is that there is little emotional attachment to a smaller account. So the pressure is not there in the same way that is for a larger account. A larger account represents hopes, goals, and dreams that become endangered with each pip the market moves against your position. Traders close out profitable trades early for fear of losing a profit. On the other hand, traders hold trades and refuse to take a loss as part of the goal or the dream goes with the loss.
Looking at each trade as one in a series of a thousand trades helps to take the pressure off of one individual trade. Setting stops and limits ahead of time and sticking with them is a good way to place the trade and walk away. Win or lose you know there is another trade out there. Keeping position size small relative to your account size will also enable you to look at each trade objectively as a potter looks at clay. Focusing on making a daily pip goal instead of a dollar figure helps too. The casino's give players chips for money because there is little emotional attachment to a plastic disk. However, there is a lot of attachment to a greenback.
I hope these suggestions help. If I get a lot of losers in a row, I drastically reduce my position size to the smallest unit I can trade. If I still can't get into the rhythm of the market then I go back to demo until I can get in synch with the market.
__________________
Gregory McLeod moderates the Active Trader Strategy Lab a thread for short-term traders.
Enroll in our online DailyFX Course today and get personalized instruction from our team of expert traders 24 hours a day. We have taught over 25,000 students and in our online courses in the past. The new DailyFX Course has nearly 600 minutes of content delivered via video so you can learn at your own pace. Join the instructors in live webinars where they will show you how to use the highlighted tool in current market conditions. Click here to get more information.
--------------------------------------------------------------------------------
Quote:
Originally Posted by jzettel
Okay, So curious If any of you have some tips to help mentally prepare trading a larger account. On my micro I'm able exercise patience and see most trades to profitability. However, on my Mini I get scared and get out too early both on winners and losers. Any words of wisdom to live by?
Thanks,
Jeff
Hello Jeff. Everyone at one time or another feels the same way. One reason is that there is little emotional attachment to a smaller account. So the pressure is not there in the same way that is for a larger account. A larger account represents hopes, goals, and dreams that become endangered with each pip the market moves against your position. Traders close out profitable trades early for fear of losing a profit. On the other hand, traders hold trades and refuse to take a loss as part of the goal or the dream goes with the loss.
Looking at each trade as one in a series of a thousand trades helps to take the pressure off of one individual trade. Setting stops and limits ahead of time and sticking with them is a good way to place the trade and walk away. Win or lose you know there is another trade out there. Keeping position size small relative to your account size will also enable you to look at each trade objectively as a potter looks at clay. Focusing on making a daily pip goal instead of a dollar figure helps too. The casino's give players chips for money because there is little emotional attachment to a plastic disk. However, there is a lot of attachment to a greenback.
I hope these suggestions help. If I get a lot of losers in a row, I drastically reduce my position size to the smallest unit I can trade. If I still can't get into the rhythm of the market then I go back to demo until I can get in synch with the market.
__________________
Gregory McLeod moderates the Active Trader Strategy Lab a thread for short-term traders.
Enroll in our online DailyFX Course today and get personalized instruction from our team of expert traders 24 hours a day. We have taught over 25,000 students and in our online courses in the past. The new DailyFX Course has nearly 600 minutes of content delivered via video so you can learn at your own pace. Join the instructors in live webinars where they will show you how to use the highlighted tool in current market conditions. Click here to get more information.
Pray for Jerusalem!
June 17, 2010
Pray for the peace of Jerusalem! "May they be secure who love you!"
--Psalm 122:6
The history and the future of the world are forever linked to the Middle East. So if you have any doubts about whether you and I are living in the last days, Israel is the super sign!
According to the Scripture, the Jewish people must return to Israel before Christ can return.
Well, Israel has been restored and Jews continue to repopulate Israel. The prophecy is being fulfilled even now!
You see, you cannot separate Israel from God's sovereign plan for our world. And even we, as Gentiles, share in this historic connection. From patriarchs to prophets, to apostles, we received the Scriptures through mostly Jewish people. And, of course, our Messiah came to us through David and the Jewish lineage.
By grace we've been grafted into God's extraordinary Kingdom and family. We have a divine and providential connection with Israel and the Jewish people... and this covenant is holy and eternal.
If you want God's blessing in this life, then bless Israel as he instructed us in his Word, and pray for the peace of Jerusalem.
And remember, just as surely as Jesus ascended into heaven from Jerusalem's Mount of Olives, he has promised to return to that very place. Jesus is coming soon!
BY GRACE WE'VE BEEN GRAFTED INTO GOD'S
EXTRAORDINARY KINGDOM AND FAMILY.
--------------------------------------------------------------------------------
For more from PowerPoint Ministries and Dr. Jack Graham, please visit www.jackgraham.org
Pray for the peace of Jerusalem! "May they be secure who love you!"
--Psalm 122:6
The history and the future of the world are forever linked to the Middle East. So if you have any doubts about whether you and I are living in the last days, Israel is the super sign!
According to the Scripture, the Jewish people must return to Israel before Christ can return.
Well, Israel has been restored and Jews continue to repopulate Israel. The prophecy is being fulfilled even now!
You see, you cannot separate Israel from God's sovereign plan for our world. And even we, as Gentiles, share in this historic connection. From patriarchs to prophets, to apostles, we received the Scriptures through mostly Jewish people. And, of course, our Messiah came to us through David and the Jewish lineage.
By grace we've been grafted into God's extraordinary Kingdom and family. We have a divine and providential connection with Israel and the Jewish people... and this covenant is holy and eternal.
If you want God's blessing in this life, then bless Israel as he instructed us in his Word, and pray for the peace of Jerusalem.
And remember, just as surely as Jesus ascended into heaven from Jerusalem's Mount of Olives, he has promised to return to that very place. Jesus is coming soon!
BY GRACE WE'VE BEEN GRAFTED INTO GOD'S
EXTRAORDINARY KINGDOM AND FAMILY.
--------------------------------------------------------------------------------
For more from PowerPoint Ministries and Dr. Jack Graham, please visit www.jackgraham.org
FA...Stocks eke out slender gain after 2 reports remind traders that economy still has problems
Tim Paradis, AP Business Writer, On Thursday June 17, 2010, 5:53 pm EDT
NEW YORK (AP) -- The stock market managed a slender gain Thursday after traders shook off a pair of disappointing economic reports.
Traders began buying late in the session, although without the vehemence that has marked other final-hour moves in recent weeks. The Dow Jones industrial average closed up about 24 points after falling 90 early in the day, and scored its first three-day advance since April. The Standard & Poor's 500 and Nasdaq composite indexes both rose a little more than a point.
The late rebound following downbeat employment and manufacturing news suggests that investors may be getting more confident about the economic recovery, said Philip Orlando, the New York-based chief equity market strategist at Federated Investors.
"I think we're starting to see a change in psychology," Orlando said. "We're beginning to ignore bad news and focusing on the bigger, better long term picture, and that's encouraging."
Still, investors were also looking for safe holdings, a sign that the economy is uncertain enough for them to hedge their bets. Treasury prices rose, pushing down interest rates, and gold closed at a record high.
The government said early in the day that the number of people seeking unemployment benefits rose unexpectedly last week. Initial claims for jobless benefits increased 12,000 to 472,000. That's the highest level in a month and follows three straight weeks of declines. Economists had forecast another drop.
A drop in the Philadelphia Federal Reserve's index of regional manufacturing also hit stocks. The Philly Fed said manufacturing continued to expand in June but at a slower pace than in May. Its index of manufacturing activity dropped to 8 from 21.4 the month before. Traders were concerned that the slowdown signals that a recovery is fading in one of the strongest parts of the economy.
"It adds up to a modest, uneven recovery," said Paul Ballew, chief economist at Nationwide Insurance in Columbus, Ohio, and a former senior economist with the Federal Reserve. "We're not expecting some light switch being turned on here."
Retailers and other stocks that depend on steady consumer spending fell following the jobs report. Bed Bath & Beyond Inc. fell 7.6 percent, and most other big retailers also ended the day with losses. DirecTV Inc. fell 3.9 percent.
Stocks regarded as safer investments during weak economies such as utilities and health care rose. FirstEnergy Corp. gained 1.6 percent, while health insurer Aetna Inc. climbed 4.5 percent after it forecast that its second-quarter earnings would beat analysts' expectations because of lower medical costs.
A stronger euro helped the market. The euro rose after a bond offering by Spain's government drew solid demand. Traders have been concerned that European countries like Spain with high debt loads would have trouble raising money because of worries about defaults. A stronger euro is seen as a sign of confidence in Europe's ability to cut its debt without jeopardizing an economic rebound. The euro climbed to $1.2396, up more than 5 cents from the four-year low it reached last week.
Traders have been trying to determine where stocks are headed since major stock indexes hit their 2010 peak in late April. The Dow has risen 6.3 percent from its lowest close of the year on June 7 but it's still down almost 7 percent from its high of 11,205 on April 26.
The Dow rose 24.71, or 0.2 percent, to 10,434.17. The last time the average had a three-day advance was April 19-21, shortly before the market began sliding on concerns about Europe's economic problems. The Dow is up 243.28 over the past three days. The bulk of that gain came from an almost 214-point jump on Tuesday.
The S&P 500 index rose 1.43, or 0.1 percent, to 1,116.04, and the Nasdaq rose 1.23, or 0.05 percent, to 2,307.16.
The yield on the benchmark 10-year Treasury note fell to 3.19 percent from 3.27 percent late Wednesday.
Crude oil fell 84 cents to $76.83 per barrel on the New York Mercantile Exchange. Gold closed at a record $1,248.70 an ounce.
BP fell 14 cents to $31.71. Aetna rose $1.31, or 4.5 percent, to $30.63.
Losing stocks were slightly ahead of gainers on the New York Stock Exchange, where consolidated volume came to 4.6 billion shares, down from 5.1 billion on Wednesday.
The Russell 2000 index of smaller companies fell 0.28, or 0.04 percent, to 665.85.
Britain's FTSE 100 rose 0.3 percent, Germany's DAX index rose 0.5 percent, and France's CAC-40 gained 0.2 percent. Japan's Nikkei stock average fell 0.7 percent.
NEW YORK (AP) -- The stock market managed a slender gain Thursday after traders shook off a pair of disappointing economic reports.
Traders began buying late in the session, although without the vehemence that has marked other final-hour moves in recent weeks. The Dow Jones industrial average closed up about 24 points after falling 90 early in the day, and scored its first three-day advance since April. The Standard & Poor's 500 and Nasdaq composite indexes both rose a little more than a point.
The late rebound following downbeat employment and manufacturing news suggests that investors may be getting more confident about the economic recovery, said Philip Orlando, the New York-based chief equity market strategist at Federated Investors.
"I think we're starting to see a change in psychology," Orlando said. "We're beginning to ignore bad news and focusing on the bigger, better long term picture, and that's encouraging."
Still, investors were also looking for safe holdings, a sign that the economy is uncertain enough for them to hedge their bets. Treasury prices rose, pushing down interest rates, and gold closed at a record high.
The government said early in the day that the number of people seeking unemployment benefits rose unexpectedly last week. Initial claims for jobless benefits increased 12,000 to 472,000. That's the highest level in a month and follows three straight weeks of declines. Economists had forecast another drop.
A drop in the Philadelphia Federal Reserve's index of regional manufacturing also hit stocks. The Philly Fed said manufacturing continued to expand in June but at a slower pace than in May. Its index of manufacturing activity dropped to 8 from 21.4 the month before. Traders were concerned that the slowdown signals that a recovery is fading in one of the strongest parts of the economy.
"It adds up to a modest, uneven recovery," said Paul Ballew, chief economist at Nationwide Insurance in Columbus, Ohio, and a former senior economist with the Federal Reserve. "We're not expecting some light switch being turned on here."
Retailers and other stocks that depend on steady consumer spending fell following the jobs report. Bed Bath & Beyond Inc. fell 7.6 percent, and most other big retailers also ended the day with losses. DirecTV Inc. fell 3.9 percent.
Stocks regarded as safer investments during weak economies such as utilities and health care rose. FirstEnergy Corp. gained 1.6 percent, while health insurer Aetna Inc. climbed 4.5 percent after it forecast that its second-quarter earnings would beat analysts' expectations because of lower medical costs.
A stronger euro helped the market. The euro rose after a bond offering by Spain's government drew solid demand. Traders have been concerned that European countries like Spain with high debt loads would have trouble raising money because of worries about defaults. A stronger euro is seen as a sign of confidence in Europe's ability to cut its debt without jeopardizing an economic rebound. The euro climbed to $1.2396, up more than 5 cents from the four-year low it reached last week.
Traders have been trying to determine where stocks are headed since major stock indexes hit their 2010 peak in late April. The Dow has risen 6.3 percent from its lowest close of the year on June 7 but it's still down almost 7 percent from its high of 11,205 on April 26.
The Dow rose 24.71, or 0.2 percent, to 10,434.17. The last time the average had a three-day advance was April 19-21, shortly before the market began sliding on concerns about Europe's economic problems. The Dow is up 243.28 over the past three days. The bulk of that gain came from an almost 214-point jump on Tuesday.
The S&P 500 index rose 1.43, or 0.1 percent, to 1,116.04, and the Nasdaq rose 1.23, or 0.05 percent, to 2,307.16.
The yield on the benchmark 10-year Treasury note fell to 3.19 percent from 3.27 percent late Wednesday.
Crude oil fell 84 cents to $76.83 per barrel on the New York Mercantile Exchange. Gold closed at a record $1,248.70 an ounce.
BP fell 14 cents to $31.71. Aetna rose $1.31, or 4.5 percent, to $30.63.
Losing stocks were slightly ahead of gainers on the New York Stock Exchange, where consolidated volume came to 4.6 billion shares, down from 5.1 billion on Wednesday.
The Russell 2000 index of smaller companies fell 0.28, or 0.04 percent, to 665.85.
Britain's FTSE 100 rose 0.3 percent, Germany's DAX index rose 0.5 percent, and France's CAC-40 gained 0.2 percent. Japan's Nikkei stock average fell 0.7 percent.
Thursday, June 17, 2010
Suddenly, Gary Shilling's Bearishness Doesn't Seem So Nutty
Posted Jun 16, 2010 02:14pm EDT by Aaron Task in Investing, Newsmakers
Related: ^DJI, ^GSPC, UUP, TLT, FXE, FXI, XLF
In case you hadn't noticed, Gary Shilling is here to let you know what's become apparent to just about everybody: "It's difficult to make a lot of money in this environment from a long only portfolio, especially from a long only stock portfolio."
The best bet for most investors right now is probably a highly diversified portfolio with uncorrelated assets that can profit (or at least preserve capital) as the market seesaws back and forth between the "risk-on" reflation trade and the "risk-off" deflation trade.
But Shilling, president of A. Gary Shilling & Co., is a charter member of the risk-off deflation camp and is positioned accordingly:
Short Stocks: Never a believer in the recovery, Shilling says stocks "have gotten way ahead of themselves" and says there's a 30% chance the devilish lows of March 2009 (S&P 666) will be retested before this secular bear market ends.
Long Treasuries: Treasuries are "THE safe haven," Shilling says, predicting the yield on the 30-year bond will go to 3%; that would be an over 30% appreciation from current levels and about 55% for his old favorite, zero coupon bonds. "That not a bad return when you look at the alternatives," he says. "I don't think we'll get anything close to that from stocks."
Long the Dollar, Short Commodities: Shilling is long the dollar vs. the euro, British sterling and Aussie dollar, the latter of which is a bet on a slowdown in China. Australia "has become a Chinese colony," Shilling quips. But it's no joke that a China slowdown will, by definition, hurt demand for commodities, most notably copper.
Broken Clock or Crazy Like a Fox?
Anyone familiar with his work and writings knows these are time-tested themes for Shilling. In December 2008, he put a 2009 target of 600 on the S&P 500, which nearly came true. But instead of declaring victory, Shilling reiterated that forecast here in March 2009, and stuck by the bearish guns in May 2009 and again in February 2010.
Back in February, Shilling was starting to look stubborn at best, and out of touch at worst. Now, however, his bearishness doesn't seem so crazy, what with:
The U.S. housing market downshifting, unemployment still high and consumers cutting back again.
The euro zone teetering on collapse about about to trigger another global financial crisis or "just" heading for a steep drop in growth amid all the austerity measures. (For more on why Europe matters, see: No Escape from Europe's Rubble)
China trying to tamp-down inflation.
Japan still a basketcase.
Sovereign debt looking like the new subprime.
The dollar benefiting from its "best house in a bad neighborhood" status, which is lulling policymakers into a false sense of security about America's ability to continue its profilgate spending.
U.S. stocks expensive on a long-term cyclically adjusted P/E basis.
"Trying to time this is tough -- it always is," Shilling tells Henry in the accompanying clip. "Deleveraging is difficult to predict [and] it's happening in discreet pieces. That affects investor sentiment and market behavior. "
Check the accompanying for more on why Shiling isn't worried about inflation (hyper or otherwise) and doesn't think you should be either.
.23 votes|Recommend this.EmailIMBookmarkdel.icio.usDiggEmbed this video:
..34 Comments
Showing comments 1 - 20 of 34Next.Yahoo! Finance User - Wednesday June 16, 2010 02:21PM EDTDespite all the printing press of the FED, inflation is not here. This is a deflationary crash. Japan had it for 20 years. Do not think we are immune. Stocks are a bubble. We have not seen the bottom back in March 2009. Here is why: http://kondratieffwinter.blogspot.com/2010/02/deflationary-depression.html
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.shai - Wednesday June 16, 2010 02:29PM EDTthe stock market is hardly likely to under go correction as long as it's being pumped look at all the negative news but the market is still going up it doesn't even follow fundamentals any more
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.Yahoo Finance User - Wednesday June 16, 2010 02:29PM EDTI have to bash Schilling for the first time. Previously, I had agreed with him a lot. Our agreements end in the "Long Treasuries" Gary, you are insane. This is for you, Gary. Can you possibly refute. People need to be careful with this BEAR camp. Most of whom have a lot stakes in the fiat currencies, which prevent them to "see" the truth. Pure BS. There are 3 levels of debts: 1. Debt to income ratio tolerable 2. Debt to income ratio intolerable. 3. Debt to income ratio NOT ONLY intolerable, but also uncollateralized or under-collateralized, AKA Ponzi Scheme AKA Unfunded liabilities AKA synthetic CDOs, CDS'. We are on the level 3 and multiply that by a factor of 3-5, you get the true picture, a PONZI sheme on a global basis. ******************** I will have more next time. ********************* In short, the path is unmistakeably currency devaluation as the central banks are monetizing the debts right at this moment. This will end very quickly as people, no matter how stupid they are, realize that deflation can co-exist with the currency devaluation, incorrectly called inflation. Such a misuse of language prevents many from realizing the inconvenient truth: these 2 can co-exist. ***************** I hereby declare that US Federal reserve is no longer relevant as the day when fiat currencies are not accepted has already arrived!! Barter will become realty. Gold is the only reserve currency in the near future when no dealers will accept any fiat currency for gold. **************** Gold is the ultimate short of the fiat currencies and current out-of-whack resource allocation. This missing phrase in the GOLD definition is the ultimate sign of the truth concealment from the uninformed MASS. The reality will force the looters' hand decisively.
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.Big E. - Wednesday June 16, 2010 02:30PM EDTDiversify, at least that way you will not feel guilty about losing all your money in one bet. Hello! returns these days are from measely to non existant, whether it's savings, investment or purchasing. It's more like ouch, ouch, than choo, choo.
report abuse
.Tups - Wednesday June 16, 2010 02:33PM EDTHi Gary, I'll take the opposite side of your positions. Put a number on it!
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.Nick - Wednesday June 16, 2010 02:35PM EDTSorry Gary, but you are wrong. In from 1995 to 2006, the best investment was real estate (in SOME markets). During that same time frame, stocks did almost nothing. We kept putting on and taking off our DOW 10,000 hats. Now it's back to a 15 year bull market in stocks. (Just like the one we have from 1980 to 1995.) Why? Corporations are getting rid of works. Boohoo right? Well, yes. But, that just means more black on the bottom line. In other words, businesses are getting leaner and meaner. Eventually they will go too far and have to start hiring again, but in the meantime, bottom line profits are going to be going up. As for me, I am not looking to hit anything out of the proverbial ballpark with my stock picks. But, I know that people need things like gasoline, heating oil, electricity, food, transportation and clothing. So that means I am buying oil companies, utility companies, and a few select retailers. Right now banks are willing to pay you about 1 percent on money market account investments. Whoppie! I would rather be earning 4 to 5 percent (with some risk) on utilities and some oil stocks. if I can earn 4 percent in dividends and another 3 percent in capital appreciation each year (and that is NOTHING), that brings me pretty darn close to the 7.2 percent I need to earn (compounded) to double my investment every 10 years. No, I am not greedy. Feed me 7.2 percent a year for the next 20 years and I will be content. That means, start with $100,000 today and have $400,000 in 20 years. Or, one million today and have 4 million in 20 years. Do the math. It ain't hard.
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.Yahoo Web Police just pulled you over. - Wednesday June 16, 2010 02:35PM EDTGary shilling is on target both on housing and the economy. However, regarding his statement on housing… the real question is will it stop at 10 to 20% drop. Personally… I think it will drop another 25 to 50%. ------------------------------------------------------------------------------------------------------------------------------------------ In every major economic event there is a catalyst… ours has many but the big one… will be the catastrophic “Gulf Oil Crisis.” It will push employment, housing and business off the edge of a very unstable cliff. ----------------------------------------------------------------------------------------------------------------------------------------- You see… it’s the wild card Wall Street hasn’t acknowledged and is America’s new "Dust Bowl"… the “Gulf Oil crisis.” It will have a huge economic and psychological impact on consumers.... lasting many, many years. A negative impact on both Gulf and east coast economies.... maybe even the World. ----------------------------------------------------------------------------------------------------------------------------------------- The environmental consequences are unknown and potentially huge… could change the warming/cooling patterns of the earth… plus the actual damages could run into the trillions of dollars… much of it unrepairable. ----------------------------------------------------------------------------------------------------------------------------------------- All the stupid Elites and Wall Street see is greed and $$$$$$$ signs… money from the clean up.... and it isn’t going to happen. The Gulf oil spill is going to suck the life out of the American economy.
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.Yahoo Web Police just pulled you over. - Wednesday June 16, 2010 02:37PM EDTCash will be king.
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.Quick - Wednesday June 16, 2010 02:37PM EDTThe "recovery" has been smoke and mirrors. $1.4 TRILLION in funny money -- "Bernie Bucks" dumped into stimulus programs the only encouraged consumers to get deeper into debt on new cars and new homes -- creating false trends in consumption numbers that are now collapsing after programs like cash for clunkers and housing purchase rebates are ending. Lots of non-productive government jobs created at levels of spending that cannot be maintained -- national debt increasing by ONE THIRD in just a year and a half.
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.William C - Wednesday June 16, 2010 02:37PM EDTWelcome to Tech Ticker - Land of hysteria
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.Johnny - Wednesday June 16, 2010 02:38PM EDTThe Roman Army under Julious Caesar is now passing the Rubicon Line and he break through beyond line and Conquer Rome to bulit a strong Roman Empire and he made it......Now the Dow Jones break the Bordeline of 10,200 from below 9,800 last month sell in May and it is above 10,200 passing to above 10,400 plus today.....It is indicating the Dow Jones will heading to 11,000 very quick and easy this time..........The forecast is 12, 500 by Christmas day.........Buy to make money until Christmas day.................That us my Tip.......My Chart is very good and accurate .....BUY.........
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.Johnny - Wednesday June 16, 2010 02:40PM EDTDo not bearish all the time Mr.GARY SHIlling otherwise your client will go out and you end up no Client at all.........
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.Thomas T - Wednesday June 16, 2010 02:42PM EDTEverbody in America without a job, get on the boat- we are going to China. You will like China, real kind people, rice everyday for all of you. If you go to China, osammie can claim a win in the job market. Just think of all the new people you will meet. Don't worry about not being able to speak the language, you have to seak spanish to order anything at Micky D's now so no probelmo. Priceless
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.Dane Gun - Wednesday June 16, 2010 02:46PM EDTGo global i have and i am loving my returns! Take a look at this! I have cleaned a 43% profit so far this year and do not get bothered by American markets constant whipsaws. All trades are traded on US markets in American brokerage account but companies are based in booming economies :) I can't tell you how much i love this program and have the best returns ytd and it only June and i have been trading for 5 years. Do you your self a favor and check it out. http://wealthinsideralliance.com/global-investing/?aff_id=588
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.Yahoo Finance User - Wednesday June 16, 2010 02:47PM EDTSyntax corrected version, sorry, hard for me type and say in this little box... I have to bash Schilling for the first time. Previously, I had agreed with him a lot. Our agreements end in the "Long Treasuries" Gary, you are insane. This is for you, Gary, Can you possibly refute against what is said below? People need to be careful with this BEAR camp. Most of whom have a lot stakes in the fiat currencies, which prevents them from "seeing" the truth. Pure BS. There are 3 levels of debts: 1. Debt to income ratio tolerable 2. Debt to income ratio intolerable. 3. Debt to income ratio NOT ONLY intolerable, but also uncollateralized or under-collateralized, AKA Ponzi Scheme AKA Unfunded liabilities AKA synthetic CDOs, CDS'. We are on the level 3 and multiply that by a factor of 3-5, you get the true picture, a PONZI sheme on a global basis. ******************** I will have more next time. ********************* In short, the path is unmistakeably currency devaluation as the central banks are monetizing the debts right at this moment. This will end very quickly as people, no matter how stupid they are, realize that deflation can co-exist with the currency devaluation, incorrectly called inflation. Such a misuse of language prevents many from realizing the inconvenient truth: these 2 can co-exist. ***************** I hereby declare that US Federal reserve is no longer relevant as the day when fiat currencies are not accepted has already arrived!! Barter will become realty. Gold is the only reserve currency in the near future when no dealers will accept any fiat currency for gold. **************** Gold is the ultimate short of the fiat currencies and current out-of-whack resource allocation. This missing phrase in the GOLD definition is the ultimate sign of the truth concealment from the uninformed MASS. The reality will force the looters' hand decisively.
report abuse
.Yahoo Finance User - Wednesday June 16, 2010 02:49PM EDTSyntax corrected version, sorry, hard for me to type and say in this little box... I have to bash Schilling for the first time. Previously, I had agreed with him a lot. Our agreements end in the "Long Treasuries" Gary, you are insane. This is for you, Gary, Can you possibly refute against what is said below? People need to be careful with this BEAR camp. Most of whom have a lot stakes in the fiat currencies, which prevents them from "seeing" the truth. Pure BS. There are 3 levels of debts: 1. Debt to income ratio tolerable 2. Debt to income ratio intolerable. 3. Debt to income ratio NOT ONLY intolerable, but also uncollateralized or under-collateralized, AKA Ponzi Scheme AKA Unfunded liabilities AKA synthetic CDOs, CDS'. We are on the level 3 and multiply that by a factor of 3-5, you get the true picture, a PONZI sheme on a global basis. ******************** I will have more next time. ********************* In short, the path is unmistakeably currency devaluation as the central banks are monetizing the debts right at this moment. This will end very quickly as people, no matter how stupid they are, realize that deflation can co-exist with the currency devaluation, incorrectly called inflation. Such a misuse of language prevents many from realizing the inconvenient truth: these 2 can co-exist. ***************** I hereby declare that US Federal reserve is no longer relevant as the day when fiat currencies are not accepted has already arrived!! Barter will become realty. Gold is the only reserve currency in the near future when no dealers will accept any fiat currency for gold. **************** Gold is the ultimate short of the fiat currencies and current out-of-whack resource allocation. This missing phrase in the GOLD definition is the ultimate sign of the truth concealment from the uninformed MASS. The reality will force the looters' hand decisively.
report abuse
.Common Sense - Wednesday June 16, 2010 02:50PM EDTDon't believe this dude. S&P 500 will not hold 666. Look for the S&P 500 to test 525.
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.Dr. D. - Wednesday June 16, 2010 02:52PM EDTGrrrrrooooowwwwwlllll....the bear lurks for thee....
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.Lorraine - Wednesday June 16, 2010 03:07PM EDTSorry Gary, you are one of MANY bears here. The shift downward in the dollar will move stocks up here. Beware of economists giving stock market predictions. No volume, many shorts, a summer coming and a dollar coming down spells pain to A. Gary and countless others.
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.mayon - Wednesday June 16, 2010 03:07PM EDTWOW--It Must be RECOVERY !!!--My 500.00 limit Capital One credit card---I got a letter from Capital One---They(Capital One) want me to now pay a 59.00 annual membership fee or If I don't agree,I have to close account---Holy-Cow--IS this a sign of "Recovery"???---Even here in the great pacific NW of WA State--mall shops=LESS--State Budget=in the red,city,county-more lay offs,budget in red,more short sales & foreclosures,small businesses can't get a bank loan & closed,state,counties raising taxes--Hmmm=Recovery???
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Related: ^DJI, ^GSPC, UUP, TLT, FXE, FXI, XLF
In case you hadn't noticed, Gary Shilling is here to let you know what's become apparent to just about everybody: "It's difficult to make a lot of money in this environment from a long only portfolio, especially from a long only stock portfolio."
The best bet for most investors right now is probably a highly diversified portfolio with uncorrelated assets that can profit (or at least preserve capital) as the market seesaws back and forth between the "risk-on" reflation trade and the "risk-off" deflation trade.
But Shilling, president of A. Gary Shilling & Co., is a charter member of the risk-off deflation camp and is positioned accordingly:
Short Stocks: Never a believer in the recovery, Shilling says stocks "have gotten way ahead of themselves" and says there's a 30% chance the devilish lows of March 2009 (S&P 666) will be retested before this secular bear market ends.
Long Treasuries: Treasuries are "THE safe haven," Shilling says, predicting the yield on the 30-year bond will go to 3%; that would be an over 30% appreciation from current levels and about 55% for his old favorite, zero coupon bonds. "That not a bad return when you look at the alternatives," he says. "I don't think we'll get anything close to that from stocks."
Long the Dollar, Short Commodities: Shilling is long the dollar vs. the euro, British sterling and Aussie dollar, the latter of which is a bet on a slowdown in China. Australia "has become a Chinese colony," Shilling quips. But it's no joke that a China slowdown will, by definition, hurt demand for commodities, most notably copper.
Broken Clock or Crazy Like a Fox?
Anyone familiar with his work and writings knows these are time-tested themes for Shilling. In December 2008, he put a 2009 target of 600 on the S&P 500, which nearly came true. But instead of declaring victory, Shilling reiterated that forecast here in March 2009, and stuck by the bearish guns in May 2009 and again in February 2010.
Back in February, Shilling was starting to look stubborn at best, and out of touch at worst. Now, however, his bearishness doesn't seem so crazy, what with:
The U.S. housing market downshifting, unemployment still high and consumers cutting back again.
The euro zone teetering on collapse about about to trigger another global financial crisis or "just" heading for a steep drop in growth amid all the austerity measures. (For more on why Europe matters, see: No Escape from Europe's Rubble)
China trying to tamp-down inflation.
Japan still a basketcase.
Sovereign debt looking like the new subprime.
The dollar benefiting from its "best house in a bad neighborhood" status, which is lulling policymakers into a false sense of security about America's ability to continue its profilgate spending.
U.S. stocks expensive on a long-term cyclically adjusted P/E basis.
"Trying to time this is tough -- it always is," Shilling tells Henry in the accompanying clip. "Deleveraging is difficult to predict [and] it's happening in discreet pieces. That affects investor sentiment and market behavior. "
Check the accompanying for more on why Shiling isn't worried about inflation (hyper or otherwise) and doesn't think you should be either.
.23 votes|Recommend this.EmailIMBookmarkdel.icio.usDiggEmbed this video:
..34 Comments
Showing comments 1 - 20 of 34Next.Yahoo! Finance User - Wednesday June 16, 2010 02:21PM EDTDespite all the printing press of the FED, inflation is not here. This is a deflationary crash. Japan had it for 20 years. Do not think we are immune. Stocks are a bubble. We have not seen the bottom back in March 2009. Here is why: http://kondratieffwinter.blogspot.com/2010/02/deflationary-depression.html
report abuse
.shai - Wednesday June 16, 2010 02:29PM EDTthe stock market is hardly likely to under go correction as long as it's being pumped look at all the negative news but the market is still going up it doesn't even follow fundamentals any more
report abuse
.Yahoo Finance User - Wednesday June 16, 2010 02:29PM EDTI have to bash Schilling for the first time. Previously, I had agreed with him a lot. Our agreements end in the "Long Treasuries" Gary, you are insane. This is for you, Gary. Can you possibly refute. People need to be careful with this BEAR camp. Most of whom have a lot stakes in the fiat currencies, which prevent them to "see" the truth. Pure BS. There are 3 levels of debts: 1. Debt to income ratio tolerable 2. Debt to income ratio intolerable. 3. Debt to income ratio NOT ONLY intolerable, but also uncollateralized or under-collateralized, AKA Ponzi Scheme AKA Unfunded liabilities AKA synthetic CDOs, CDS'. We are on the level 3 and multiply that by a factor of 3-5, you get the true picture, a PONZI sheme on a global basis. ******************** I will have more next time. ********************* In short, the path is unmistakeably currency devaluation as the central banks are monetizing the debts right at this moment. This will end very quickly as people, no matter how stupid they are, realize that deflation can co-exist with the currency devaluation, incorrectly called inflation. Such a misuse of language prevents many from realizing the inconvenient truth: these 2 can co-exist. ***************** I hereby declare that US Federal reserve is no longer relevant as the day when fiat currencies are not accepted has already arrived!! Barter will become realty. Gold is the only reserve currency in the near future when no dealers will accept any fiat currency for gold. **************** Gold is the ultimate short of the fiat currencies and current out-of-whack resource allocation. This missing phrase in the GOLD definition is the ultimate sign of the truth concealment from the uninformed MASS. The reality will force the looters' hand decisively.
report abuse
.Big E. - Wednesday June 16, 2010 02:30PM EDTDiversify, at least that way you will not feel guilty about losing all your money in one bet. Hello! returns these days are from measely to non existant, whether it's savings, investment or purchasing. It's more like ouch, ouch, than choo, choo.
report abuse
.Tups - Wednesday June 16, 2010 02:33PM EDTHi Gary, I'll take the opposite side of your positions. Put a number on it!
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.Nick - Wednesday June 16, 2010 02:35PM EDTSorry Gary, but you are wrong. In from 1995 to 2006, the best investment was real estate (in SOME markets). During that same time frame, stocks did almost nothing. We kept putting on and taking off our DOW 10,000 hats. Now it's back to a 15 year bull market in stocks. (Just like the one we have from 1980 to 1995.) Why? Corporations are getting rid of works. Boohoo right? Well, yes. But, that just means more black on the bottom line. In other words, businesses are getting leaner and meaner. Eventually they will go too far and have to start hiring again, but in the meantime, bottom line profits are going to be going up. As for me, I am not looking to hit anything out of the proverbial ballpark with my stock picks. But, I know that people need things like gasoline, heating oil, electricity, food, transportation and clothing. So that means I am buying oil companies, utility companies, and a few select retailers. Right now banks are willing to pay you about 1 percent on money market account investments. Whoppie! I would rather be earning 4 to 5 percent (with some risk) on utilities and some oil stocks. if I can earn 4 percent in dividends and another 3 percent in capital appreciation each year (and that is NOTHING), that brings me pretty darn close to the 7.2 percent I need to earn (compounded) to double my investment every 10 years. No, I am not greedy. Feed me 7.2 percent a year for the next 20 years and I will be content. That means, start with $100,000 today and have $400,000 in 20 years. Or, one million today and have 4 million in 20 years. Do the math. It ain't hard.
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.Yahoo Web Police just pulled you over. - Wednesday June 16, 2010 02:35PM EDTGary shilling is on target both on housing and the economy. However, regarding his statement on housing… the real question is will it stop at 10 to 20% drop. Personally… I think it will drop another 25 to 50%. ------------------------------------------------------------------------------------------------------------------------------------------ In every major economic event there is a catalyst… ours has many but the big one… will be the catastrophic “Gulf Oil Crisis.” It will push employment, housing and business off the edge of a very unstable cliff. ----------------------------------------------------------------------------------------------------------------------------------------- You see… it’s the wild card Wall Street hasn’t acknowledged and is America’s new "Dust Bowl"… the “Gulf Oil crisis.” It will have a huge economic and psychological impact on consumers.... lasting many, many years. A negative impact on both Gulf and east coast economies.... maybe even the World. ----------------------------------------------------------------------------------------------------------------------------------------- The environmental consequences are unknown and potentially huge… could change the warming/cooling patterns of the earth… plus the actual damages could run into the trillions of dollars… much of it unrepairable. ----------------------------------------------------------------------------------------------------------------------------------------- All the stupid Elites and Wall Street see is greed and $$$$$$$ signs… money from the clean up.... and it isn’t going to happen. The Gulf oil spill is going to suck the life out of the American economy.
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.Yahoo Web Police just pulled you over. - Wednesday June 16, 2010 02:37PM EDTCash will be king.
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.Quick - Wednesday June 16, 2010 02:37PM EDTThe "recovery" has been smoke and mirrors. $1.4 TRILLION in funny money -- "Bernie Bucks" dumped into stimulus programs the only encouraged consumers to get deeper into debt on new cars and new homes -- creating false trends in consumption numbers that are now collapsing after programs like cash for clunkers and housing purchase rebates are ending. Lots of non-productive government jobs created at levels of spending that cannot be maintained -- national debt increasing by ONE THIRD in just a year and a half.
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.William C - Wednesday June 16, 2010 02:37PM EDTWelcome to Tech Ticker - Land of hysteria
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.Johnny - Wednesday June 16, 2010 02:38PM EDTThe Roman Army under Julious Caesar is now passing the Rubicon Line and he break through beyond line and Conquer Rome to bulit a strong Roman Empire and he made it......Now the Dow Jones break the Bordeline of 10,200 from below 9,800 last month sell in May and it is above 10,200 passing to above 10,400 plus today.....It is indicating the Dow Jones will heading to 11,000 very quick and easy this time..........The forecast is 12, 500 by Christmas day.........Buy to make money until Christmas day.................That us my Tip.......My Chart is very good and accurate .....BUY.........
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.Johnny - Wednesday June 16, 2010 02:40PM EDTDo not bearish all the time Mr.GARY SHIlling otherwise your client will go out and you end up no Client at all.........
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.Thomas T - Wednesday June 16, 2010 02:42PM EDTEverbody in America without a job, get on the boat- we are going to China. You will like China, real kind people, rice everyday for all of you. If you go to China, osammie can claim a win in the job market. Just think of all the new people you will meet. Don't worry about not being able to speak the language, you have to seak spanish to order anything at Micky D's now so no probelmo. Priceless
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.Dane Gun - Wednesday June 16, 2010 02:46PM EDTGo global i have and i am loving my returns! Take a look at this! I have cleaned a 43% profit so far this year and do not get bothered by American markets constant whipsaws. All trades are traded on US markets in American brokerage account but companies are based in booming economies :) I can't tell you how much i love this program and have the best returns ytd and it only June and i have been trading for 5 years. Do you your self a favor and check it out. http://wealthinsideralliance.com/global-investing/?aff_id=588
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.Yahoo Finance User - Wednesday June 16, 2010 02:47PM EDTSyntax corrected version, sorry, hard for me type and say in this little box... I have to bash Schilling for the first time. Previously, I had agreed with him a lot. Our agreements end in the "Long Treasuries" Gary, you are insane. This is for you, Gary, Can you possibly refute against what is said below? People need to be careful with this BEAR camp. Most of whom have a lot stakes in the fiat currencies, which prevents them from "seeing" the truth. Pure BS. There are 3 levels of debts: 1. Debt to income ratio tolerable 2. Debt to income ratio intolerable. 3. Debt to income ratio NOT ONLY intolerable, but also uncollateralized or under-collateralized, AKA Ponzi Scheme AKA Unfunded liabilities AKA synthetic CDOs, CDS'. We are on the level 3 and multiply that by a factor of 3-5, you get the true picture, a PONZI sheme on a global basis. ******************** I will have more next time. ********************* In short, the path is unmistakeably currency devaluation as the central banks are monetizing the debts right at this moment. This will end very quickly as people, no matter how stupid they are, realize that deflation can co-exist with the currency devaluation, incorrectly called inflation. Such a misuse of language prevents many from realizing the inconvenient truth: these 2 can co-exist. ***************** I hereby declare that US Federal reserve is no longer relevant as the day when fiat currencies are not accepted has already arrived!! Barter will become realty. Gold is the only reserve currency in the near future when no dealers will accept any fiat currency for gold. **************** Gold is the ultimate short of the fiat currencies and current out-of-whack resource allocation. This missing phrase in the GOLD definition is the ultimate sign of the truth concealment from the uninformed MASS. The reality will force the looters' hand decisively.
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.Yahoo Finance User - Wednesday June 16, 2010 02:49PM EDTSyntax corrected version, sorry, hard for me to type and say in this little box... I have to bash Schilling for the first time. Previously, I had agreed with him a lot. Our agreements end in the "Long Treasuries" Gary, you are insane. This is for you, Gary, Can you possibly refute against what is said below? People need to be careful with this BEAR camp. Most of whom have a lot stakes in the fiat currencies, which prevents them from "seeing" the truth. Pure BS. There are 3 levels of debts: 1. Debt to income ratio tolerable 2. Debt to income ratio intolerable. 3. Debt to income ratio NOT ONLY intolerable, but also uncollateralized or under-collateralized, AKA Ponzi Scheme AKA Unfunded liabilities AKA synthetic CDOs, CDS'. We are on the level 3 and multiply that by a factor of 3-5, you get the true picture, a PONZI sheme on a global basis. ******************** I will have more next time. ********************* In short, the path is unmistakeably currency devaluation as the central banks are monetizing the debts right at this moment. This will end very quickly as people, no matter how stupid they are, realize that deflation can co-exist with the currency devaluation, incorrectly called inflation. Such a misuse of language prevents many from realizing the inconvenient truth: these 2 can co-exist. ***************** I hereby declare that US Federal reserve is no longer relevant as the day when fiat currencies are not accepted has already arrived!! Barter will become realty. Gold is the only reserve currency in the near future when no dealers will accept any fiat currency for gold. **************** Gold is the ultimate short of the fiat currencies and current out-of-whack resource allocation. This missing phrase in the GOLD definition is the ultimate sign of the truth concealment from the uninformed MASS. The reality will force the looters' hand decisively.
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.Common Sense - Wednesday June 16, 2010 02:50PM EDTDon't believe this dude. S&P 500 will not hold 666. Look for the S&P 500 to test 525.
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.Dr. D. - Wednesday June 16, 2010 02:52PM EDTGrrrrrooooowwwwwlllll....the bear lurks for thee....
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.Lorraine - Wednesday June 16, 2010 03:07PM EDTSorry Gary, you are one of MANY bears here. The shift downward in the dollar will move stocks up here. Beware of economists giving stock market predictions. No volume, many shorts, a summer coming and a dollar coming down spells pain to A. Gary and countless others.
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.mayon - Wednesday June 16, 2010 03:07PM EDTWOW--It Must be RECOVERY !!!--My 500.00 limit Capital One credit card---I got a letter from Capital One---They(Capital One) want me to now pay a 59.00 annual membership fee or If I don't agree,I have to close account---Holy-Cow--IS this a sign of "Recovery"???---Even here in the great pacific NW of WA State--mall shops=LESS--State Budget=in the red,city,county-more lay offs,budget in red,more short sales & foreclosures,small businesses can't get a bank loan & closed,state,counties raising taxes--Hmmm=Recovery???
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FA...Stocks close little changed after BP agreement for victim fund eases uncertainty about company
Tim Paradis, AP Business Writer, On Wednesday June 16, 2010, 5:36 pm EDT
NEW YORK (AP) -- BP's agreement to put $20 billion into a fund for victims of the Gulf of Mexico oil spill lifted the stock market off its lows and sent the major indexes to a narrowly mixed finish.
The oil company also said Wednesday it has canceled a dividend payment totaling about $2.6 billion that was scheduled for June 21. It also won't declare a dividend for the second and third quarters. Investors saw the news as an end to the uncertainty about BP's stability, and that helped steady the overall market. The Dow Jones industrial average rose about 4 points, while the Standard & Poor's 500 index fell less than a point and the Nasdaq composite index was virtually unchanged.
BP's plans to place $20 billion in a fund to compenste victims were announced after a meeting between BP executives and President Barack Obama at the White House. Traders had been questioning how BP will handle the mounting costs of the spill, which began April 20 when a rig operated by BP exploded.
"One source of uncertainty has been at least partially resolved," said Brian Gendreau, a market strategist with Financial Network Investment Corp.
The market began the day by falling on news that home construction and applications for building permits slumped in May following the end of a homebuyer tax credit. Meanwhile, FedEx Corp. released a disappointing profit forecast for the fiscal year that began June 1, and that raised more questions about the economic recovery. The package delivery company is seen as a barometer of the economy because shipping demand tends to increase as business conditions improve. The stock fell almost 6 percent.
The Commerce Department's report on housing raised concerns that weaker demand for homes will hurt an economic rebound. Construction of homes and apartments fell 10 percent from a month earlier to an annual rate of 593,000, well below the 650,000 economists had forecast. A 17 percent drop in construction of single-family homes was the largest since January 1991.
Applications for building permits fell 5.9 percent to the lowest level in a year. Analysts had forecast an increase. Demand for permits is an indicator of future homebuilding activity. The weaker-than-expected numbers come after a homebuyer tax credit expired in April.
Kevin Smith, a housing market analyst at Chapdelaine Credit Partners in New York, said the drop in the home construction and permit numbers extends a string of choppy readings since October, and that it's too soon to tell how housing will hold up. He noted that the previous month had been the best in more than two years.
"It's going to be a bumpy ride," Smith said. He said housing won't make a strong recovery until unemployment falls and overall confidence grows.
The homebuyer's credit was part of the government package of stimulus measures designed to help the economy recover from the mortgage and financial crises of 2008. Investors have been uneasy about what would happen to the economy when the government started to withdraw those measures.
Wednesday's trading reflected the juggling act investors have been doing for months. While many of the economic signs in the U.S. show the recovery is proceeding, news like the home construction figures and the FedEx forecast have created doubt about the strength of the rebound. Events like the oil spill, which raises the prospect of a weakened oil giant as well as severe economic fallout from the disaster, have also unnerved traders. And economic problems remain in several European countries.
The Dow rose 4.69, or 0.05 percent, to 10,409.46, its fourth advance in five days. During morning trading, the Dow was down as much as 72.
The S&P 500 fell 0.62, or 0.06 percent, to 1,114.61, and the Nasdaq crept up 0.05 to 2,305.93.
Losing stocks were ahead of advancers by 3 to 2 on the New York Stock Exchange, where consolidated volume came to 5.1 billion shares, up from 4.7 billion on Tuesday.
Bond prices edged higher, pushing down interest rates. The yield on the benchmark 10-year Treasury note slipped to 3.27 percent from 3.31 percent late Tuesday.
The Dow is still down more than 7 percent from the 2010 high of 11,205.03 it reached April 26.
Stocks also steadied after the euro pulled off its lows. A Spanish newspaper reported that the International Monetary Fund and European Union were trying to come up with a financial rescue for Spain. That hit the euro and pushed the dollar higher. Officials in Spain denied the report. The country, like Greece and Portugal, is facing high debt loads. The euro fell to $1.2318. Last week it was a four-year low of $1.1878
U.S. markets have been tracking the moves of the 16-nation currency because it is seen as a measure of confidence in Europe's economy. European countries are in the midst of cutting spending, and investors are concerned that those cutbacks could curtail the region's economic rebound, and in turn, the U.S. recovery.
FedEx fell $4.94, or 6 percent, to $78.07. The company said its fiscal 2011 outlook was based on the assumption of a continued "moderate recovery" in the global economy.
BP rose 45 cents, or 1.4 percent, to $31.85. The company's stock is down by nearly half since the day of the explosion, when it was trading at about $60.
Homebuilders fell after the government's report. Toll Brothers Inc. fell 15 cents to $18.78, while KB Home fell 22 cents to $12.93.
Crude oil rose 72 cents to $77.66 per barrel on the New York Mercantile Exchange. Gold climbed.
The Russell 2000 index of smaller companies fell 2.64, or 0.4 percent, to 666.13.
Britain's FTSE 100 rose 0.4 percent, Germany's DAX index gained 0.3 percent, and France's CAC-40 rose 0.4 percent.
NEW YORK (AP) -- BP's agreement to put $20 billion into a fund for victims of the Gulf of Mexico oil spill lifted the stock market off its lows and sent the major indexes to a narrowly mixed finish.
The oil company also said Wednesday it has canceled a dividend payment totaling about $2.6 billion that was scheduled for June 21. It also won't declare a dividend for the second and third quarters. Investors saw the news as an end to the uncertainty about BP's stability, and that helped steady the overall market. The Dow Jones industrial average rose about 4 points, while the Standard & Poor's 500 index fell less than a point and the Nasdaq composite index was virtually unchanged.
BP's plans to place $20 billion in a fund to compenste victims were announced after a meeting between BP executives and President Barack Obama at the White House. Traders had been questioning how BP will handle the mounting costs of the spill, which began April 20 when a rig operated by BP exploded.
"One source of uncertainty has been at least partially resolved," said Brian Gendreau, a market strategist with Financial Network Investment Corp.
The market began the day by falling on news that home construction and applications for building permits slumped in May following the end of a homebuyer tax credit. Meanwhile, FedEx Corp. released a disappointing profit forecast for the fiscal year that began June 1, and that raised more questions about the economic recovery. The package delivery company is seen as a barometer of the economy because shipping demand tends to increase as business conditions improve. The stock fell almost 6 percent.
The Commerce Department's report on housing raised concerns that weaker demand for homes will hurt an economic rebound. Construction of homes and apartments fell 10 percent from a month earlier to an annual rate of 593,000, well below the 650,000 economists had forecast. A 17 percent drop in construction of single-family homes was the largest since January 1991.
Applications for building permits fell 5.9 percent to the lowest level in a year. Analysts had forecast an increase. Demand for permits is an indicator of future homebuilding activity. The weaker-than-expected numbers come after a homebuyer tax credit expired in April.
Kevin Smith, a housing market analyst at Chapdelaine Credit Partners in New York, said the drop in the home construction and permit numbers extends a string of choppy readings since October, and that it's too soon to tell how housing will hold up. He noted that the previous month had been the best in more than two years.
"It's going to be a bumpy ride," Smith said. He said housing won't make a strong recovery until unemployment falls and overall confidence grows.
The homebuyer's credit was part of the government package of stimulus measures designed to help the economy recover from the mortgage and financial crises of 2008. Investors have been uneasy about what would happen to the economy when the government started to withdraw those measures.
Wednesday's trading reflected the juggling act investors have been doing for months. While many of the economic signs in the U.S. show the recovery is proceeding, news like the home construction figures and the FedEx forecast have created doubt about the strength of the rebound. Events like the oil spill, which raises the prospect of a weakened oil giant as well as severe economic fallout from the disaster, have also unnerved traders. And economic problems remain in several European countries.
The Dow rose 4.69, or 0.05 percent, to 10,409.46, its fourth advance in five days. During morning trading, the Dow was down as much as 72.
The S&P 500 fell 0.62, or 0.06 percent, to 1,114.61, and the Nasdaq crept up 0.05 to 2,305.93.
Losing stocks were ahead of advancers by 3 to 2 on the New York Stock Exchange, where consolidated volume came to 5.1 billion shares, up from 4.7 billion on Tuesday.
Bond prices edged higher, pushing down interest rates. The yield on the benchmark 10-year Treasury note slipped to 3.27 percent from 3.31 percent late Tuesday.
The Dow is still down more than 7 percent from the 2010 high of 11,205.03 it reached April 26.
Stocks also steadied after the euro pulled off its lows. A Spanish newspaper reported that the International Monetary Fund and European Union were trying to come up with a financial rescue for Spain. That hit the euro and pushed the dollar higher. Officials in Spain denied the report. The country, like Greece and Portugal, is facing high debt loads. The euro fell to $1.2318. Last week it was a four-year low of $1.1878
U.S. markets have been tracking the moves of the 16-nation currency because it is seen as a measure of confidence in Europe's economy. European countries are in the midst of cutting spending, and investors are concerned that those cutbacks could curtail the region's economic rebound, and in turn, the U.S. recovery.
FedEx fell $4.94, or 6 percent, to $78.07. The company said its fiscal 2011 outlook was based on the assumption of a continued "moderate recovery" in the global economy.
BP rose 45 cents, or 1.4 percent, to $31.85. The company's stock is down by nearly half since the day of the explosion, when it was trading at about $60.
Homebuilders fell after the government's report. Toll Brothers Inc. fell 15 cents to $18.78, while KB Home fell 22 cents to $12.93.
Crude oil rose 72 cents to $77.66 per barrel on the New York Mercantile Exchange. Gold climbed.
The Russell 2000 index of smaller companies fell 2.64, or 0.4 percent, to 666.13.
Britain's FTSE 100 rose 0.4 percent, Germany's DAX index gained 0.3 percent, and France's CAC-40 rose 0.4 percent.
Wednesday, June 16, 2010
FA...Industrial, technology stocks lift market on signs of increasing demand; Dow rises 213
Tim Paradis, AP Business Writer, On Tuesday June 15, 2010, 5:57 pm
NEW YORK (AP) -- Industrial and technology stocks pulled the market sharply higher Tuesday after Boeing Co. said it was boosting production and an industry group forecast that demand for computers would increase.
The Dow Jones industrial average rose 213 points to its highest close since May 19 and had their third advance in four days. Major stock indexes rose more than 2 percent.
The advance was broad, but came on light trading volume. That's a sign that many traders are staying out of the market while they wait to see if stocks will keep moving higher after weeks of erratic trading.
Industrials made some of the biggest moves following upbeat news from Boeing Co. and Illinois Tool Works Inc. Boeing rose 4 percent after increasing production of the 737 jet. Boeing said customers are adding to existing orders and placing new ones. ITW rose about 2.5 percent after it raised the lower end of its fiscal second-quarter earnings target.
More good news on industrials came from the New York Federal Reserve, which said regional manufacturing expanded for an 11th straight month in June.
"We're still seeing factories and manufacturing help provide a little stimulus for the economy here," said Michael Church, president at Addison Capital Group in Philadelphia.
Technology stocks got a boost after research firm International Data Corp. raised its forecast for personal computer shipments for 2010. IDC said shipments will be up almost 20 percent from 2010, compared with a forecast of a 15 percent increase made in April. Microsoft Corp. rose 4.3 percent and Hewlett Packard Co. rose 2.4 percent.
A gain in the euro and a drop in the dollar signaled that traders are less worried that debt problems in Europe will disrupt a global recovery. The euro, which is seen as measure of investors' confidence in the European economy, traded at $1.2339. Last week, it fell to a four-year low of $1.1878.
Stocks had dropped along with the euro since May amid growing concerns that weaker European countries such as Greece would default on debt. Investors also were afraid that the budget cuts that countries including Greece, Spain and Portugal have had to implement will slow their economic growth. The concern was that growth across the continent and the rest of the world would also be hurt.
Tuesday's trading shows that investors have started to put aside some of their uneasiness about Europe and focus on continuing signs of strength in the U.S. Still, the market is susceptible to troubling headlines. On Monday, stocks gave up steep gains, partly because Moody's cut its rating on Greece's debt to "junk" status.
Investors are also ready to punish stocks of companies that have disappointing news. Best Buy Co. fell 6.1 percent Tuesday after the electronics chain posted weaker-than-expected earnings.
Analysts have predicted that the market's choppy trading of the past two months is likely to continue until investors feel more secure about the global economy. The Dow has had 24 triple-digit moves in the 35 trading days since it reached a 2010 high of 11,205.03 on April 26.
The Dow rose 213.88, or 2.1 percent, to 10,404.77. The broader Standard & Poor's 500 index rose 25.60, or 2.4 percent, to 1,115.23,
The Standard & Poor's 500 index moved above its average close of the past 200 days, 1,108. The 200-day moving average is a technical level watched by many traders. Pushing above that is seen as a sign of strength in the market. Gains in stocks faded Monday in part after the S&P 500 index failed to top the mark.
The tech-dominated Nasdaq composite index rose 61.92, or 2.8 percent, to 2,305.88.
Bond prices fell and drove up interest rates after stocks climbed. The yield on the benchmark 10-year Treasury note rose to 3.31 percent from 3.26 percent late Monday.
Andrew Neale, head of portfolio management at Fogel Neale Partners in New York, is skeptical that the market's climb will hold. He noted that many individual investors are growing weary of the market's sharp swings and are pulling money out of mutual funds and other investments. That means the gains are being driven largely by professional traders.
"We don't see any real retail buying," Neale said, referring to individual investors. "We're advising our clients to be very cautious with the market."
Boeing climbed $2.66, or 4.1 percent, to $67.48 and Illinois Tool rose $1.13, or 2.5 percent, to $46.78.
Microsoft Corp. rose $1.09, or 4.3 percent, to $26.58. Hewlett Packard rose $1.10 to $47.98.
Best Buy's fiscal first-quarter net income and revenue fell short of analysts' expectations but the company reiterated its fiscal 2011 forecast. The report brought concerns that consumers will cut spending and hurt a U.S. recovery. Best Buy fell $2.49, or 6.1 percent, to $38.56.
Shares of BP PLC rose 73 cents, or 2.4 percent, to $31.40 after falling 10 percent Monday when concerns grew about stepped-up political pressure in the U.S. to set aside money for costs related to the Gulf of Mexico oil spill that began April 20 when a rig operated by BP exploded. On Tuesday, credit ratings agency Fitch cut its rating on the oil company's debt. Fitch cited concerns about rising costs tied to the spill.
Commodities rose as investors were again tempted by investments seen as riskier. The prospect of a stronger global economy also lifted demand for metals and energy. Benchmark crude for July delivery rose $1.82 to settle at $76.94 a barrel on the New York Mercantile Exchange. Copper for July delivery rose 1.25 cents, or 0.42 percent, to settle at $3.0045 a pound.
The Russell 2000 index of smaller companies rose 16.50, or 2.5 percent, to 668.77.
Six stocks rose for every one that fell on the New York Stock Exchange, where consolidated volume came to 4.7 billion shares, versus 4.5 billion shares the day before.
Britain's FTSE 100 climbed 0.3 percent, Germany's DAX index rose 0.8 percent, and France's CAC-40 rose 1 percent. Japan's Nikkei stock average finished up 0.1 percent.
NEW YORK (AP) -- Industrial and technology stocks pulled the market sharply higher Tuesday after Boeing Co. said it was boosting production and an industry group forecast that demand for computers would increase.
The Dow Jones industrial average rose 213 points to its highest close since May 19 and had their third advance in four days. Major stock indexes rose more than 2 percent.
The advance was broad, but came on light trading volume. That's a sign that many traders are staying out of the market while they wait to see if stocks will keep moving higher after weeks of erratic trading.
Industrials made some of the biggest moves following upbeat news from Boeing Co. and Illinois Tool Works Inc. Boeing rose 4 percent after increasing production of the 737 jet. Boeing said customers are adding to existing orders and placing new ones. ITW rose about 2.5 percent after it raised the lower end of its fiscal second-quarter earnings target.
More good news on industrials came from the New York Federal Reserve, which said regional manufacturing expanded for an 11th straight month in June.
"We're still seeing factories and manufacturing help provide a little stimulus for the economy here," said Michael Church, president at Addison Capital Group in Philadelphia.
Technology stocks got a boost after research firm International Data Corp. raised its forecast for personal computer shipments for 2010. IDC said shipments will be up almost 20 percent from 2010, compared with a forecast of a 15 percent increase made in April. Microsoft Corp. rose 4.3 percent and Hewlett Packard Co. rose 2.4 percent.
A gain in the euro and a drop in the dollar signaled that traders are less worried that debt problems in Europe will disrupt a global recovery. The euro, which is seen as measure of investors' confidence in the European economy, traded at $1.2339. Last week, it fell to a four-year low of $1.1878.
Stocks had dropped along with the euro since May amid growing concerns that weaker European countries such as Greece would default on debt. Investors also were afraid that the budget cuts that countries including Greece, Spain and Portugal have had to implement will slow their economic growth. The concern was that growth across the continent and the rest of the world would also be hurt.
Tuesday's trading shows that investors have started to put aside some of their uneasiness about Europe and focus on continuing signs of strength in the U.S. Still, the market is susceptible to troubling headlines. On Monday, stocks gave up steep gains, partly because Moody's cut its rating on Greece's debt to "junk" status.
Investors are also ready to punish stocks of companies that have disappointing news. Best Buy Co. fell 6.1 percent Tuesday after the electronics chain posted weaker-than-expected earnings.
Analysts have predicted that the market's choppy trading of the past two months is likely to continue until investors feel more secure about the global economy. The Dow has had 24 triple-digit moves in the 35 trading days since it reached a 2010 high of 11,205.03 on April 26.
The Dow rose 213.88, or 2.1 percent, to 10,404.77. The broader Standard & Poor's 500 index rose 25.60, or 2.4 percent, to 1,115.23,
The Standard & Poor's 500 index moved above its average close of the past 200 days, 1,108. The 200-day moving average is a technical level watched by many traders. Pushing above that is seen as a sign of strength in the market. Gains in stocks faded Monday in part after the S&P 500 index failed to top the mark.
The tech-dominated Nasdaq composite index rose 61.92, or 2.8 percent, to 2,305.88.
Bond prices fell and drove up interest rates after stocks climbed. The yield on the benchmark 10-year Treasury note rose to 3.31 percent from 3.26 percent late Monday.
Andrew Neale, head of portfolio management at Fogel Neale Partners in New York, is skeptical that the market's climb will hold. He noted that many individual investors are growing weary of the market's sharp swings and are pulling money out of mutual funds and other investments. That means the gains are being driven largely by professional traders.
"We don't see any real retail buying," Neale said, referring to individual investors. "We're advising our clients to be very cautious with the market."
Boeing climbed $2.66, or 4.1 percent, to $67.48 and Illinois Tool rose $1.13, or 2.5 percent, to $46.78.
Microsoft Corp. rose $1.09, or 4.3 percent, to $26.58. Hewlett Packard rose $1.10 to $47.98.
Best Buy's fiscal first-quarter net income and revenue fell short of analysts' expectations but the company reiterated its fiscal 2011 forecast. The report brought concerns that consumers will cut spending and hurt a U.S. recovery. Best Buy fell $2.49, or 6.1 percent, to $38.56.
Shares of BP PLC rose 73 cents, or 2.4 percent, to $31.40 after falling 10 percent Monday when concerns grew about stepped-up political pressure in the U.S. to set aside money for costs related to the Gulf of Mexico oil spill that began April 20 when a rig operated by BP exploded. On Tuesday, credit ratings agency Fitch cut its rating on the oil company's debt. Fitch cited concerns about rising costs tied to the spill.
Commodities rose as investors were again tempted by investments seen as riskier. The prospect of a stronger global economy also lifted demand for metals and energy. Benchmark crude for July delivery rose $1.82 to settle at $76.94 a barrel on the New York Mercantile Exchange. Copper for July delivery rose 1.25 cents, or 0.42 percent, to settle at $3.0045 a pound.
The Russell 2000 index of smaller companies rose 16.50, or 2.5 percent, to 668.77.
Six stocks rose for every one that fell on the New York Stock Exchange, where consolidated volume came to 4.7 billion shares, versus 4.5 billion shares the day before.
Britain's FTSE 100 climbed 0.3 percent, Germany's DAX index rose 0.8 percent, and France's CAC-40 rose 1 percent. Japan's Nikkei stock average finished up 0.1 percent.
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