Wednesday, October 11, 2006

Stocks Finish Slightly Lower on Profit-taking, FOMC Comments and NYC Plane Crash Worries

Indices
S&P 500 1,349.95 -.26%
DJIA 11,852.13 -.13%
NASDAQ 2,308.27 -.31%
Russell 2000 741.71 -.56%
Wilshire 5000 13,484.90 -.30%
S&P Barra Growth 625.49 -.33%
S&P Barra Value 722.50 -.18%
Morgan Stanley Consumer 654.83 +.09%
Morgan Stanley Cyclical 845.13 -.47%
Morgan Stanley Technology 542.14 +.05%
Transports 4,592.53 -1.03%
Utilities 433.11 +.12%
Put/Call .91 +13.75%
NYSE Arms .89 +26.47%
Volatility(VIX) 11.62 +.87%
ISE Sentiment 121.0 -1.6%
US Dollar 87.10 +.09%
CRB 297.81 -.53%

Futures Spot Prices
Crude Oil 57.50 -1.74%
Unleaded Gasoline 144.61 -1.28%
Natural Gas 6.14 -4.92%
Heating Oil 166.80 -.77%
Gold 576.50 unch.
Base Metals 234.80 -.54%
Copper 341.80 +.26%
10-year US Treasury Yield 4.77% +.55%

Leading Sectors
Semis +1.29%
Airlines +.44%
HMOs +.38%

Lagging Sectors
Gold & Silver -2.09%
Oil Service -2.24%
I-Banks -3.90%

Evening Review
Detailed Market Summary
Market Gauges
Daily ETF Performance
Style Performance
Market Wrap CNBC Video(bottom right)
S&P 500 Gallery View
Economic Calendar
Timely Economic Charts
GuruFocus.com
PM Market Call
After-hours Movers
Real-time/After-hours Stock Quote
In Play

Afternoon Recommendations
- None of note

Afternoon/Evening Headlines
Bloomberg:
- Crude oil plunged to the lowest this year in NY, falling over $1/bbl. to $57.46/bbl. on speculation OPEC won’t cut production enough to stem falling prices. Oil has declined $21/bbl. or 27% in less than three months on slowing global growth, increasing global supplies, a stronger US dollar and less speculation by investment funds.
- A small plane crashed into a 50-story apartment building on Manhattan’s Upper East Side, exploding in a fireball that engulfed at least one floor. Four people died, including NY Yankees pitcher Cory Lidle.
- The North American Aerospace Defense Command said it sent fighter jets over “numerous” US cities in response to a small plane crashing today into an apartment building on NY’s Upper East Side.
- US natural-gas inventories may have climbed by 63 billion cubic feet last week to another all-time high, according to trading in options and forward contracts tied to a weekly report form the US energy department.
- US home foreclosures fell 2.7% in Sept., according to RealtyTrac Foreclosure report.

AP:
- Democratic Senate Minority Leader Harry Reid may have failed to properly report transactions connected to land that netted him a $1.1 million profit, citing property deeds, records and interviews.

BOTTOM LINE: The Portfolio finished slightly lower today on losses in my Telecom longs and Retail longs. I did not trade in the final hour, thus leaving the Portfolio 100% net long. The tone of the market was slightly negative today as the advance/decline line finished modestly lower, sector performance was mixed and volume was above average. Measures of investor anxiety were higher into the close. I would again classify today's overall market action as a healthy consolidation of recent gains. The 10-year yield only rose 2 basis points on the day, despite supposed "hawkish" comments in the FOMC minutes. I suspect the mild rise was more related to the "better retail sales" and "accelerating growth in 2007" comments in the FOMC minutes. Most of today's losses were confined to the I-banking and commodity sectors. Tech stocks, specifically semis, performed quite well. I suspect the terrorism-related sell-off this afternoon left even more investors leaning the wrong way as I sense bears remain stunningly complacent, given the DJIA is only 25 points off a record high. As well, I continue to believe the majority of bulls are looking for an overbought pullback of 2%-3% and have raised cash accordingly. This bodes well for another substantial push higher in the major averages over the coming weeks.

No comments: