Indices
S&P 500 1,220.14 +1.81%
DJIA 10,530.76 +1.23%
NASDAQ 2,169.43 +3.81%
Russell 2000 658.16 +3.59%
DJ Wilshire 5000 12,194.17 +2.18%
S&P Equity Long/Short Index 1,059.27 +.56%
S&P Barra Growth 584.33 +1.89%
S&P Barra Value 631.56 +1.74%
Morgan Stanley Consumer 585.42 +.13%
Morgan Stanley Cyclical 732.22 +3.21%
Morgan Stanley Technology 510.26 +3.73%
Transports 3,935.22 +5.17%
Utilities 392.90 -.79%
S&P 500 Cum A/D Line 7,227.00 +15.12%
Bloomberg Crude Oil % Bulls 23.0 -8.0%
Put/Call .86 +4.88%
NYSE Arms .86 +68.63%
Volatility(VIX) 13.17 -7.58%
ISE Sentiment 189.00 +51.20%
AAII % Bulls 42.95 +34.01%
US Dollar 91.26 +1.87%
CRB 318.77 -1.04%
Futures Spot Prices
Crude Oil 60.58 -1.17%
Unleaded Gasoline 160.80 -3.13%
Natural Gas 11.41 -12.53%
Heating Oil 179.62 -5.46%
Gold 457.90 -1.93%
Base Metals 136.47 +2.61%
Copper 184.70 +2.04%
10-year US Treasury Yield 4.66% +1.97%
Average 30-year Mortgage Rate 6.31% +2.60%
Leading Sectors
Retail +7.09%
Gaming +6.48%
Semis +6.35%
Lagging Sectors
Foods -.90%
Gold & Silver -.91%
REITs -1.48%
One-Week High-Volume Gainers
One-Week High-Volume Losers
*5-Day % Change
Friday, November 04, 2005
Stocks Mixed Mid-day as Profit-taking Offsets Lower Energy Prices
Indices
S&P 500 1,216.47 -.28%
DJIA 10,503.27 -.18%
NASDAQ 2,161.42 +.06%
Russell 2000 655.48 -.50%
DJ Wilshire 5000 12,158.20 -.30%
S&P Barra Growth 582.72 -.18%
S&P Barra Value 629.71 -.35%
Morgan Stanley Consumer 584.50 -.33%
Morgan Stanley Cyclical 729.07 +2.69%
Morgan Stanley Technology 507.78 -.23%
Transports 3,919.38 -1.36%
Utilities 391.83 -.60%
Put/Call .83 -8.79%
NYSE Arms 1.05 +31.47%
Volatility(VIX) 13.47 +3.62%
ISE Sentiment 179.00 +12.58%
US Dollar 91.29 +.94%
CRB 318.83 -.77%
Futures Spot Prices
Crude Oil 60.80 -1.67%
Unleaded Gasoline 161.00 -1.03%
Natural Gas 11.36 -2.81%
Heating Oil 179.30 -2.21%
Gold 457.50 -.95%
Base Metals 136.47 +.72%
Copper 184.60 +1.04%
10-year US Treasury Yield 4.65% +.14%
Leading Sectors %
Gaming +1.21%
Restaurants +1.04%
HMOs +.77%
Lagging Sectors
Steel -1.48%
Energy -2.80%
Oil Service -2.85%
S&P 500 1,216.47 -.28%
DJIA 10,503.27 -.18%
NASDAQ 2,161.42 +.06%
Russell 2000 655.48 -.50%
DJ Wilshire 5000 12,158.20 -.30%
S&P Barra Growth 582.72 -.18%
S&P Barra Value 629.71 -.35%
Morgan Stanley Consumer 584.50 -.33%
Morgan Stanley Cyclical 729.07 +2.69%
Morgan Stanley Technology 507.78 -.23%
Transports 3,919.38 -1.36%
Utilities 391.83 -.60%
Put/Call .83 -8.79%
NYSE Arms 1.05 +31.47%
Volatility(VIX) 13.47 +3.62%
ISE Sentiment 179.00 +12.58%
US Dollar 91.29 +.94%
CRB 318.83 -.77%
Futures Spot Prices
Crude Oil 60.80 -1.67%
Unleaded Gasoline 161.00 -1.03%
Natural Gas 11.36 -2.81%
Heating Oil 179.30 -2.21%
Gold 457.50 -.95%
Base Metals 136.47 +.72%
Copper 184.60 +1.04%
10-year US Treasury Yield 4.65% +.14%
Leading Sectors %
Gaming +1.21%
Restaurants +1.04%
HMOs +.77%
Lagging Sectors
Steel -1.48%
Energy -2.80%
Oil Service -2.85%
BOTTOM LINE: The Portfolio is higher mid-day on gains in my Internet longs, Software longs, Steel shorts and Energy-related shorts. I have not traded today, thus leaving the Portfolio 100% net long. The tone of the market is slightly negative as the advance/decline line is lower, sector performance is mixed and volume is slightly above average. Measures of investor anxiety are mixed. Today's market action appears to be a healthy consolidation of recent gains to me. A number of sectors are higher or just slightly lower. The only real losses are in the commodity stocks, which is positive for the market as a whole. I have been forecasting continued strength in the US dollar for some time. This is now helping to pressure commodity prices. Gold is especially weak, due to US dollar strength, and will likely remain so over the intermediate-term as inflation decelerates and the dollar remains relatively strong. The 10-year T-note yield is slightly higher to 4.66%. However, this is still lower than the 4.92% it touched intraday last year and still near historically low levels. I expect US stocks to trade modestly higher from current levels into the close on more optimism and short-covering.
Today's Headlines
Bloomberg:
- Berkshire Hathaway may report its lowest quarterly profit in almost four years because of losses from Hurricane Katrina and an incorrect bet against the US dollar.
- The US House of Representatives voted to bolster private-property rights by limiting local governments’ power to seize land for economic development.
- Crude oil may decline as stockpiles increase and warm weather in the northern US cuts demand for heating oil, a Bloomberg survey showed.
- Autonomy, whose software helps businesses keep track of data, agreed to buy US competitor Verity for $500 million in cash to add programs for searching databases.
- The US dollar rose to a 26-month high against the yen and the strongest level of the year versus the euro on continuing optimism over the US economy relative to the economies of other developed nations.
Wall Street Journal:
- Investors, including private partnerships and real-estate investment trusts, are buying millions of acres of US forest land from companies such as International Paper under pressure to boost profit.
NY Times:
- Mazada Motor joined Toyota Motor, Honda Motor and Ford Motor in featuring alternative-fuel vehicles at the Tokyo Motor Show.
- Ford Motor is expected to announce plans today to subsidize the installation of around 100 ethanol fuel pumps at gasoline stations in the US Midwest to push a money-saving alternative to gas.
Washington Post:
- SBC Communications CEO Whitacre stirred controversy over access to the Internet when he indicated companies wouldn’t be able to use SBC’s network for free.
- FEMA said it will set aside as much as $1.5 billion worth for small companies to maintain trailers for Hurricane Katrina evacuees.
Philadelphia Inquirer:
- Planet Hollywood International plans to build a $380 million casino along the Penn’s Landing waterfront in Philadelphia, subject to approval by city and state officials.
Detroit News:
- GM has been operating several assembly plans on overtime and ordering more parts from suppliers to prepare for a possible strike at Delphi.
Financial Times:
- Pierre Omidyar, the founder of EBay, will start a $100 million fund with a view to lending to small businesses in developing countries.
- Berkshire Hathaway may report its lowest quarterly profit in almost four years because of losses from Hurricane Katrina and an incorrect bet against the US dollar.
- The US House of Representatives voted to bolster private-property rights by limiting local governments’ power to seize land for economic development.
- Crude oil may decline as stockpiles increase and warm weather in the northern US cuts demand for heating oil, a Bloomberg survey showed.
- Autonomy, whose software helps businesses keep track of data, agreed to buy US competitor Verity for $500 million in cash to add programs for searching databases.
- The US dollar rose to a 26-month high against the yen and the strongest level of the year versus the euro on continuing optimism over the US economy relative to the economies of other developed nations.
Wall Street Journal:
- Investors, including private partnerships and real-estate investment trusts, are buying millions of acres of US forest land from companies such as International Paper under pressure to boost profit.
NY Times:
- Mazada Motor joined Toyota Motor, Honda Motor and Ford Motor in featuring alternative-fuel vehicles at the Tokyo Motor Show.
- Ford Motor is expected to announce plans today to subsidize the installation of around 100 ethanol fuel pumps at gasoline stations in the US Midwest to push a money-saving alternative to gas.
Washington Post:
- SBC Communications CEO Whitacre stirred controversy over access to the Internet when he indicated companies wouldn’t be able to use SBC’s network for free.
- FEMA said it will set aside as much as $1.5 billion worth for small companies to maintain trailers for Hurricane Katrina evacuees.
Philadelphia Inquirer:
- Planet Hollywood International plans to build a $380 million casino along the Penn’s Landing waterfront in Philadelphia, subject to approval by city and state officials.
Detroit News:
- GM has been operating several assembly plans on overtime and ordering more parts from suppliers to prepare for a possible strike at Delphi.
Financial Times:
- Pierre Omidyar, the founder of EBay, will start a $100 million fund with a view to lending to small businesses in developing countries.
Job Market Bounces Back After Hurricanes
- The Change in Non-farm Payrolls for October was 56K versus estimates of 120K and an upwardly revised -8K in September.
- The Change in Manufacturing Payrolls for October was 12K versus estimates of -9K and -28K in September.
- The Unemployment Rate for October fell to 5.0% versus estimates of 5.1% and 5.1% in September.
- Average Hourly Earnings for October rose .5% versus estimates of a .2% increase and a .1% gain in September.
- The Change in Manufacturing Payrolls for October was 12K versus estimates of -9K and -28K in September.
- The Unemployment Rate for October fell to 5.0% versus estimates of 5.1% and 5.1% in September.
- Average Hourly Earnings for October rose .5% versus estimates of a .2% increase and a .1% gain in September.
BOTTOM LINE: The US economy added 56,000 jobs in October as hiring lagged even in areas not hurt by Hurricanes Katrina and Rita, Bloomberg reported. The economy has created 118,000 jobs over the last 4 months, mainly due to the effects of the hurricanes. The manufacturing workweek rose to 41 hours from 40.6 hours. The .5% gain in average hourly earnings for October was the largest monthly increase since February 2003. I expect job creation to improve through year-end, but not to levels seen before the hurricanes struck. This should help keep unit labor costs, the largest component of inflation, in check.
Thursday, November 03, 2005
Friday Watch
Late-Night Headlines
Bloomberg:
- Amazon.com plans to sell online access to any page or section of a book, as well as its entirety. Random House said it’s developing a similar service and may participate in Amazon’s program.
- Shares of BlueScope Steel Ltd. had their biggest-ever slump after Australia’s biggest steelmaker said profit may fall as much as 38% as rising inventories curb prices. Steel prices may fall as much as 27% next year as rising Chinese output causes a glut, ABN Amro analyst Michael Sones said.
Financial Times:
- Microsoft has agreed to a deal with the British Library to make digital copies of 25 million pages of material, including books, journals, maps and manuscripts, available on the Internet.
AFP:
- Riots broke out for the eighth consecutive night in the suburbs of Paris. The violence was most severe in the north-eastern Seine-Saint-Denis area, where 1,300 police officers were deployed. Over 40 vehicles were set alight and shots were fired at police.
Late Buy/Sell Recommendations
Goldman Sachs:
- Reiterated Outperform on LVS, WON and SBUX.
- Reiterated Underperform on ABC, FTO and CSC.
Business Week:
- Drugmaker Wyeth(WYE) is an attractive takeover target because it would help a larger rival expand its biological drug business.
- Shares of Ethan Allen Interiors(ETH) may decline as the furniture designer and marker’s growth is threatened by low-cost, high-quality imports.
Night Trading
Asian Indices are unch. to +.75% on average.
S&P 500 indicated -.10%.
NASDAQ 100 indicated -.12%.
Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell CNBC Video(bottom right)
Global Commentary
Asian Indices
European Indices
Top 20 Business Stories
In Play
Bond Ticker
Daily Stock Events
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule
Earnings of Note
Company/EPS Estimate
FO/1.12
GDT/.49
NBL/1.18
RL/.90
PWR/.07
Upcoming Splits
- None of note
Economic Releases
8:30 am EST
- The Change in Non-farm Payrolls for October is estimated at 120K versus -27K in September.
- The Change in Manufacturing Payrolls for October is estimated at -9K versus -27K in September.
- The Unemployment Rate for October is estimated at 5.1% versus 5.1% in September.
- Average Hourly Earnings for October is estimated to rise .2% versus a .2% gain in September.
Bloomberg:
- Amazon.com plans to sell online access to any page or section of a book, as well as its entirety. Random House said it’s developing a similar service and may participate in Amazon’s program.
- Shares of BlueScope Steel Ltd. had their biggest-ever slump after Australia’s biggest steelmaker said profit may fall as much as 38% as rising inventories curb prices. Steel prices may fall as much as 27% next year as rising Chinese output causes a glut, ABN Amro analyst Michael Sones said.
Financial Times:
- Microsoft has agreed to a deal with the British Library to make digital copies of 25 million pages of material, including books, journals, maps and manuscripts, available on the Internet.
AFP:
- Riots broke out for the eighth consecutive night in the suburbs of Paris. The violence was most severe in the north-eastern Seine-Saint-Denis area, where 1,300 police officers were deployed. Over 40 vehicles were set alight and shots were fired at police.
Late Buy/Sell Recommendations
Goldman Sachs:
- Reiterated Outperform on LVS, WON and SBUX.
- Reiterated Underperform on ABC, FTO and CSC.
Business Week:
- Drugmaker Wyeth(WYE) is an attractive takeover target because it would help a larger rival expand its biological drug business.
- Shares of Ethan Allen Interiors(ETH) may decline as the furniture designer and marker’s growth is threatened by low-cost, high-quality imports.
Night Trading
Asian Indices are unch. to +.75% on average.
S&P 500 indicated -.10%.
NASDAQ 100 indicated -.12%.
Morning Preview
US AM Market Call
NASDAQ 100 Pre-Market Indicator/Heat Map
Pre-market Commentary
Before the Bell CNBC Video(bottom right)
Global Commentary
Asian Indices
European Indices
Top 20 Business Stories
In Play
Bond Ticker
Daily Stock Events
Macro Calls
Rasmussen Consumer/Investor Daily Indices
CNBC Guest Schedule
Earnings of Note
Company/EPS Estimate
FO/1.12
GDT/.49
NBL/1.18
RL/.90
PWR/.07
Upcoming Splits
- None of note
Economic Releases
8:30 am EST
- The Change in Non-farm Payrolls for October is estimated at 120K versus -27K in September.
- The Change in Manufacturing Payrolls for October is estimated at -9K versus -27K in September.
- The Unemployment Rate for October is estimated at 5.1% versus 5.1% in September.
- Average Hourly Earnings for October is estimated to rise .2% versus a .2% gain in September.
BOTTOM LINE: Asian indices are mostly higher, led by Japan as the Nikkei 225 broke 14,000 for the first time in more than four years. I expect US equities to open modestly higher on a better-than-expected employment report. The Portfolio is 100% net long heading into the day.
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