Thursday, November 08, 2007

Stocks Finish Mostly Lower on Weakness in the Tech Sector

S&P 500 1,474.77 -.06%
DJIA 13,266.29 -.25%
NASDAQ 2,696.00 -1.92%
Russell 2000 780.90 +.64%
Wilshire 5000 14,855.40 +.01%
Russell 1000 Growth 613.28 -.73%
Russell 1000 Value 803.80 +.76%
Morgan Stanley Consumer 735.22 +.73%
Morgan Stanley Cyclical 1,017.98 +.26%
Morgan Stanley Technology 634.48 -3.57%
Transports 4,696.73 +.72%
Utilities 526.89 +1.99%
MSCI Emerging Markets 157.79 -.13%

Total Put/Call 1.24 +15.89%
NYSE Arms .86 -46.61%
Volatility(VIX) 26.16 -1.25%
ISE Sentiment 119.0 +10.19%

Futures Spot Prices
Crude Oil $95.60 -.80%
Reformulated Gasoline 243.65 -.17%
Natural Gas 7.73 +1.43%
Heating Oil 260.15 -.61%
Gold 833.90 +.05%
Base Metals 241.32 -1.77%
Copper 321.75 -1.27%

10-year US Treasury Yield 4.28% -4 basis points
US Dollar 75.43 +.03%
CRB Index 353.85 -.16%

Leading Sectors
Alternative Energy +2.5%
Utilities +1.99%
HMOs +1.65%

Lagging Sectors
Networking -3.19%
Computer Hardware -3.59%
Internet -4.66%

Evening Review
Market Performance Summary
WSJ Data Center
Sector Performance
ETF Performance
Style Performance
Commodity Movers
Market Wrap CNBC Video(bottom right)
S&P 500 Gallery View
Timely Economic Charts
PM Market Call
After-hours Commentary
After-hours Movers

After-hours Stock Quote
In Play

Afternoon Recommendations
- None of note

Afternoon/Evening Headlines
- Most US stocks rose after a final-hour rally in banks from their lowest level in two years overcame a sell-off in technology shares led by Cisco Systems(CSCO).
- Qualcomm Inc. said profit rose 84% after selling more chips. The shares fell 7.4% after a forecast missed analysts’ estimates.
-’s(PCLN) gross travel bookings for the 3rd quarter rose 54% to $1.39 billion. The shares jumped 9% in after-hours trading.

BOTTOM LINE: The Portfolio finished lower today on losses in my Computer longs, Internet longs, Semi longs and Software longs. I did not trade in the final hour, thus leaving the Portfolio 75% net long. The tone of the market was slightly negative today as the advance/decline line finished mildly lower, most sectors gained and volume was heavy. Measures of investor anxiety were above about average into the close. Today's overall market action was mildly bearish. Meaningful weakness was almost exclusively concentrated in market leading tech stocks today. Most sectors gained. While today's afternoon rebound, led by financials, was a positive, I would have liked to have seen more evidence of angst at the lows. Copper has broken down through its uptrend that has been in place since January. Oil is near session lows, falling 0.88, but continues to levitate near $100 per barrel on extreme speculation by investment funds. I want to see how Asia reacts to our stock rebound before further shifting market exposure. Nikkei futures are indicating a flat open in Japan right now. The AAII percentage of bulls dropped to 36.19% this week from 44.7% the prior week. This reading is back to below-average levels. The AAII percentage of bears soared to 51.4% this week from 36.5% the prior week. This reading is now at elevated levels. The percentage of bears has only been higher six other times over the last decade. Moreover, the 10-week moving average of the percentage of bears is currently at 36.6%, a high level. The 10-week moving average of the percentage of bears peaked at 43.0% at the major bear market low during 2002. The 50-week moving average of the percentage of bears is currently 37.3%, an elevated level seen during only two other periods since tracking began in the 1980s. Those periods were October 1990 to July 1991 and March 2003 to May 2003, both of which were near major stock market bottoms. The extreme readings in the 50-week moving average of the percentage of bears during those periods peaked at 41.6% on Jan. 31, 1991, and 38.1% on April 10, 2003. We are currently still close to eclipsing the peak in long-term bearish sentiment during the 2000 to 2003 market meltdown. I find this astonishing, notwithstanding the recent pullback, given that the S&P 500 is 107% higher from the October 2002 major bear market lows and just made a new record high three weeks ago.

No comments: