Weekly Outlook

Click here for Wall St. Week Ahead by Reuters.

Click here for Stocks to Watch Monday by MarketWatch.

Click here for TradeTheNews.com Weekly Calendar.

BOTTOM LINE: I expect US stocks to finish the week mixed as mostly positive earnings reports, lower energy prices and bargain-hunting offset economic worries, financial sector concerns and technical selling. My trading indicators are giving mostly bearish signals and the Portfolio is 75% net long heading into the week.

Market Week in Review

S&P 500 1,036.19 -4.02%*

Click here for the Weekly Wrap by Briefing.com.

*5-Day Change

Weekly Scoreboard*

Indices
S&P 500 1,036.19 -4.02%
DJIA 9,712.73 -2.60%
NASDAQ 2,045.11 -5.08%
Russell 2000 562.77 -6.34%
Wilshire 5000 10,521.58 -4.42%
Russell 1000 Growth 458.73 -3.77%
Russell 1000 Value 529.16 -4.77%
Morgan Stanley Consumer 634.05 -3.15%
Morgan Stanley Cyclical 708.59 -9.23%
Morgan Stanley Technology 516.50 -4.94%
Transports 3,613.34 -5.04%
Utilities 363.04 -3.81%
MSCI Emerging Markets 38.19 -6.40%

Lyxor L/S Equity Long Bias Index 951.0 -1.63%

Lyxor L/S Equity Variable Bias Index 842.32 -1.60%

Lyxor L/S Equity Short Bias Index 1,015.64 +1.83%

Sentiment/Internals
NYSE Cumulative A/D Line +55,985 -8.72%
Bloomberg New Highs-Lows Index -66 -115.35%
Bloomberg Crude Oil % Bulls 29.0 -12.12%
CFTC Oil Net Speculative Position +109,619 +47.37%

CFTC Oil Total Open Interest 1,220,540 +.34%
Total Put/Call 1.19 +40.0%
OEX Put/Call 1.57 -10.80%
ISE Sentiment 84.0 -37.78%
NYSE Arms 2.98 +30.13%
Volatility(VIX) 30.69 +37.81%
G7 Currency Volatility (VXY) 13.32 +4.88%
Smart Money Flow Index 9,350.25 -2.91%

Money Mkt Mutual Fund Assets $3.370 Trillion -.10%
AAII % Bulls 33.65 -16.91%
AAII % Bears 42.31 +18.52%

Futures Spot Prices
CRB Index 270.38 -3.55%

Crude Oil 77.0 -3.31%
Reformulated Gasoline 195.95 -3.91%
Natural Gas 5.04 -7.96%
Heating Oil 200.52 -3.98%
Gold 1,040.40 -1.44%
Bloomberg Base Metals 189.93 -2.29%
Copper 295.55 -2.28%

US No. 1 Heavy Melt Scrap Steel 244.0 USD/Ton -3.05%

China Hot Rolled Domestic Steel Sheet 3,511 Yuan/Ton +1.18%

S&P GSCI Agriculture 318.72 -5.38%

Economy
ECRI Weekly Leading Economic Index 128.40 +.39%

Citi US Economic Surprise Index +29.20 -21.08%

Fed Fund Futures imply 56.9% chance of no change, 43.1% chance of 25 basis point cut on 11/04

US Dollar Index 76.30 +1.10%

Yield Curve 249.0 +1 basis point

10-year US Treasury Yield 3.38% -11 basis points

Federal Reserve’s Balance Sheet $2.144 Trillion -1.81%

U.S. Sovereign Debt Credit Default Swap 20.0 unch.

10-year TIPS Spread 2.02% +2 basis points
TED Spread 24.0 +1 basis point
N. Amer. Investment Grade Credit Default Swap Index 106.95 +7.21%

Euro Financial Sector Credit Default Swap Index 68.91 +11.56%
Emerging Markets Credit Default Swap Index 278.53 +5.45%
CMBS Super Senior AAA 10-year Treasury Spread 443.0 -5.14%

M1 Money Supply $1.679 Trillion +.72%

Business Loans 659.40 -.69%
4-Wk MA of Jobless Claims 526,300 -1.10%

Continuing Claims Unemployment Rate 4.40% -10 basis points
Average 30-year Mortgage Rate 5.03% +3 basis points
Weekly Mortgage Applications 562,300 -12.28%

ABC Consumer Confidence -51 -1 point
Weekly Retail Sales +.60% +10 basis points
Nationwide Gas $2.70/gallon +.06/gallon
US Cooling Demand Next 7 Days 19.0% below normal
Baltic Dry Index 3,103 +1.97%

Oil Tanker Rate(Arabian Gulf to US Gulf Coast) 30.0 unch.

Rail Freight Carloads 207,041 +.61%

Iraqi 2028 Govt Bonds 75.88 -2.0%

Best Performing Style
Large-Cap Growth -3.77%

Worst Performing Style
Small-Cap Growth -6.51%

Leading Sectors
HMOs +.03%

Telecom -.09%

Computer Services -.65%

Drugs -1.67%
Restaurants -2.60%

Lagging Sectors
Homebuilders -10.53%
Steel -10.66%
Hospitals -10.76%
Gaming -10.85%
Education -13.87%

One-Week High-Volume Gainers

One-Week High-Volume Losers

*5-Day Change

Stocks Finish at Session Lows, Weighed Down by Commodity, Financial, Hospital, Networking, Disk Drive and Insurance Shares

Evening Review
BNO Breaking Global News of Note

Google Top Stories

Bloomberg Breaking News

Yahoo Most Popular Biz Stories

MarketWatch News Viewer

Briefing.com In Play

SeekingAlpha Market Currents

WSJ Today’s Markets
Today’s Movers
StockCharts Market Performance Summary
WSJ Data Center
Sector Performance
ETF Performance
Morningstar Style Performance
Commodity Futures
S&P 500 Gallery View
Timely Economic Charts
Most Recent Guru Stock Picks
CNN PM Market Call
After-hours Stock Commentary
After-hours Movers
After-hours Stock Quote
After-hours Stock Chart

Stocks Sharply Lower into Final Hour on Economic Fear, Financial Sector Pessimism, More Shorting, Profit-Taking

BOTTOM LINE: The Portfolio is lower into the final hour on losses in my Technology longs, Retail longs and Financial longs. I added (IWM)/(QQQQ) hedges and added to my (EEM) short this morning, thus leaving the Portfolio 75% net long. The tone of the market is very negative as the advance/decline line is substantially lower, every sector is falling and volume is slightly above average. Investor anxiety is very high. Today’s overall market action is bearish. The VIX is soaring 27.3% and is very high at 31.58. The ISE Sentiment Index is very low at 74.0 and the total put/call is very high at 1.20. Finally, the NYSE Arms has been running very high most of the day, hitting 4.03 at its intraday peak, and is currently 2.35. The Euro Financial Sector Credit Default Swap Index is jumping +6.91% today to 69.66 basis points. This index is down from its record March 10th high of 208.75. The North American Investment Grade Credit Default Swap Index is rising +2.32% to 106.95 basis points. This index is also well below its Dec. 5^th record high of 285.99. The TED spread is rising +1 basis point to 24 basis points. The TED spread is now down 440 basis points since its all-time high of 463 basis points on October 10th. The 2-year swap spread is rising +3.99% to 34.19 basis points. The Libor-OIS spread is unch. at 13 basis points. The 10-year TIPS spread, a good gauge of inflation expectations, is down -2 basis points to 2.02%, which is down 63 basis points since July 7th. The 3-month T-Bill is yielding .04%, which is down -1 basis point today. Cyclical and Small-Cap shares are under the most pressure today as economic fears rise to the fore once again. As well, (XLF)/(IYR) have traded heavy throughout the day. Bank, Insurance, Hospital, Oil Service, Coal and Disk Drive shares are substantially underperforming, falling 4%+. The market’s severe reaction to today’s news is a big negative. On the positive side, investor angst gauges are soaring with volume only slightly above average. I expect Asia to come under significant pressure Sunday night and negative stories over the weekend, which will likely lead to further US weakness Monday morning. However, I suspect another sharp snapback rally is in the offing early next week. Nikkei futures indicate a -254 open in Japan and DAX futures indicate a -17 open in Germany on Monday. I expect US stocks to trade mixed-to-lower into the close from current levels on rising economic fear, financial sector pessimism, profit-taking and more shorting.