STOCK MARKET WATCH, Monday 28 February

[ozymandius]

Monday February 28, 2005

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 3 YEARS, 326 DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 4 YEARS, 77 DAYS
WHERE'S OSAMA BIN-LADEN? 3 YEARS, 133 DAYS
DAYS SINCE ENRON COLLAPSE = 1191
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 2
Other Arrests of Execs = 54

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U.S. FUTURES & MARKETS INDICATORS
NASDAQ FUTURES-----------------------------S&P FUTURES

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AT THE CLOSING BELL ON February 25, 2005

Dow... 10,841.60 +92.81 (+0.86%)
Nasdaq... 2,065.40 +13.70 (+0.67%)
S&P 500... 1,211.37 +11.17 (+0.93%)
10-Yr Bond... 4.27% -0.01 (-0.21%)
Gold future... 436.10 +0.40 (+0.09%)





GOLD, EURO, YEN, Dollars and Loonie

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PIEHOLE ALERT

Heads Up!
Preliminary info on appearances by Bush & Co. throughout the country. Details & links are added as they become available so check back. And if you know more, are organizing something, or would like to, contact [e-mail]

For information on protests and other actions Citizens For Legitimate Government

---

[ozymandius]

1. WrapUp by Tim W. Wood

THE DOW REPORT
Dogs of the Dow - Part II

Tim W. Wood on FinancialSense.comLast week we set up a model portfolio using Michael O’Higgins’ Book Value method. This week we are going to set up another Dogs of the Dow model portfolio using the Dividend method. This method is widely used and is aimed at picking high dividend paying stocks. For this method we look at the 30 stocks that make up the Dow Jones Industrial Average and simply pick the 10 stocks with the highest dividend yields. This becomes our model portfolio for the entire year. This portfolio is then adjusted at yearend for the next year. Ideally, we should have set this portfolio up on January 1, 2005 and used the closing prices for 2004. But, since we didn’t set the portfolio up at that time and because I want to be consistent, so that we can compare the Dividend method to the Book Value method, we will use the closing data as of February 18, 2005.

-cut-

The purpose of tracking this model portfolio is multifold. One, we want to compare the performance of the Book value method to that of the Dividend method. Two, we want to compare both of these methods to the performance of the Dow Jones Industrial Average. Three, if the slide into Phase II of the bear market, according to Dow theory, begins in 2005 we want to see how these methods perform in that environment as well.

Now for a quick look at the market. Below is a daily chart of the Industrials and the Transports. In 2004 the story was that the Industrials were lagging the Transports. Now the shoe is on the other foot and the Transports are lagging the Industrials. According to Dow theory the markets are clearly not in gear. We know from our studies of the past that when the averages are not in agreement they are warning us to be careful because trouble likely lies ahead.

more...

http://www.financialsense.com/Market/wrapup.htm

[ClintonTyree]

2. Trouble ahead?

No way, we've "turned the corner" and everything is coming up roses. I see that the dire concern of early last week viv-a-vis the falling dollar has already been forgotten and it's full steam ahead again with the irrational upward trend in the market. Fools and their money........

[ozymandius]

6. I have made an executive decision.

I will not put any new assets into the market until after Greenscam retires. That'll be nine months from now. I will be surprised if there is not some shakeup when his hand leaves the wheel.

[RawMaterials]

3. Gold near year high on weak dollar, firm oil

LONDON, Feb 28 (Reuters) - Gold prices hovered just below their highest for the year on Monday in Europe, bolstered by renewed weakness in the dollar and firm oil prices, traders and analysts said.

Spot gold rose to an eight-week high of $437.00 a troy ounce -- its strongest since the start of the year.

By 1117 GMT, gold <XAU=> was quoted at $436.75/437.50 an ounce, up from New York's late Friday quote of $434.55/435.30.

"The strength today is partly due to the weaker U.S. dollar and partly as a result of the oil price going higher. We are looking for a break through the year's best," said Paul Merrick, vice president for commodities at RBC Capital Markets.

A weaker U.S. currency makes dollar-priced metals cheaper for non-U.S. investors.

snip..

Sentiment has improved dramatically in gold over the past couple of weeks when a bout of liquidation aided by fears of gold sales by the International Monetary Fund (IMF) took the metal right down to $410 an ounce.

Traders were now looking for bullion to regain $440 an ounce -- a level seen late last year. Gold peaked in early December 2004 at $456.75, its highest since June 1988.

Analysts noted news out late last week that a majority of Group of Seven members favour selling some of the IMF's gold reserves to fund debt relief.

Alan Williamson, analyst with HSBC Bank, said the report had been "effectively ignored" given the U.S. has a veto on such sales and is known to oppose the plan that was proposed by British finance minister Gordon Brown.

Merrick said funds were still interested in gold and saw further interest if prices started to move back above $440, which he predicted to happen over the next 10 days or so.

"I am looking at the moment at gold investments for clients who are keen to get back in," he said.

http://www.fxstreet.com/nou/noticies/afx/noticia.asp?font=Reuters&pv_noticia=MTFH36682_2005-02-28_11-26-18_L28624407

[ozymandius]

4. It's 10:27. Do you know where your numbers are?

------------------------------------------------------------------------
 Market Summary
------------------------------------------------------------------------
Dow 10,811.53 -30.07 (-0.28%)
Nasdaq 2,059.29 -6.11 (-0.30%)
S&P 500 1,208.23 -3.14 (-0.26%)
10-Yr Bond 4.282% +0.01
NYSE Volume 323,367,000
Nasdaq Volume 492,237,000
------------------------------------------------------------------------

[ozymandius]

5. Good morning all!

:donut: :donut: :donut: :donut: :donut:

Gee, it's quiet around here. I hope everyone is having a relaxing start to their day.

Ozy

[stevedeshazer]

7. Good Morning, ozymandius!

Still shaking off the weekend. It's my birthday today. Have a great day, everyone!

[ozymandius]

10. Good morning Steve! Congratulations!

:toast: :party: :toast:

[RawMaterials]

8. Side of Blather

10:30AM : Stocks remain under pressure as Chicago PMI holds strong but new home sales fall... Feb Chicago PMI has checked in above the breakeven 50% mark for the 22nd consecutive month with a read of 62.7 (consensus 60.5), as both the production and new orders components rose to very strong 68.5 levels and employment rose 5 points to 57.7... The better than expected expansion in regional manufacturing activity should bode well for tomorrow's release of the ISM index (consensus 57.0)...

Jan new home sales, however, dipped 9.2% to 1.106 mln (consensus 1.125 mln) as the Dec gain was revised to 5.6% (from 0.1%)... The housing data, which are more volatile over the winter months, were reflected by an even wilder swing in pricing...NYSE Adv/Dec 1349/1619, Nasdaq Adv/Dec 1097/1634

10:00AM : Indices continue to sport modest losses early on as investors await another batch of economic data... Meanwhile, energy (+1.0%) continues to benefit from higher oil prices while semiconductor has extended last week's gains after the SOX (+0.6%) hit a new 2005 high on Friday and positive comments on Oracle (ORCL 13.22 +0.09) have given software a boost... Biotech (-4.2%), however has been hammered after Biogen Idec (BIIB 40.37 -26.91) and Elan (ELN 9.12 -17.78) pulled their MS drug Tysabri from the market...

Airline, transportation, financial, utility, homebuilding and materials have also been weak...NYSE Adv/Dec 1169/1362, Nasdaq Adv/Dec 1171/1334

9:40AM : Market shows little follow through, opening on a lower note, as inflation concerns resurface... While the underlying trends with regards to the Commerce Dept.'s earlier report were stable, Jan personal income and spending data were affected by monthly fluctuations... Jan income fell 2.3%, less than economists expected (consensus -2.6%), due to the downside of Microsoft's Dec dividend payment which left a 3.7% gain, while personal spending was flat (consensus +0.1%)...

More noteworthy was the inflation indicator (deflator) for personal spending, which climbed 0.2%, while the core deflator rose 0.3%, the largest gain since Oct. 2001, adding some interim inflation worries following the larger than expected Jan core PPI of +0.8%... At 10:00 ET, Feb Chicago PMI (consensus 60.5) and Jan New Home Sales (consensus 1125K) will be released...

9:15AM : S&P futures vs fair value: -1.8. Nasdaq futures vs fair value: -6.0. Expectations remain intact for stocks to open on a downbeat note... Still contributing to the modest weakness have been mixed economic data, downside guidance and and oil prices near $52/bbl

9:00AM : S&P futures vs fair value: -2.2. Nasdaq futures vs fair value: -6.0. Still shaping up to be a modestly lower open for the cash market as the larger than expected 0.3% rise in the core PCE price index was a bit concerning... While this morning's earnings were few and far between, the three worth noting (i.e. HNZ, GAS and TIF) all posted better than expected results, but GAS and TIF issued downside guidance... There have also been some notable downgrades on GM, F, BIIB, DDS, APC, MAY and NOVL while TXN, BSC, BBY, GP and CSC have been upgraded

8:32AM : S&P futures vs fair value: -1.5. Nasdaq futures vs fair value: -1.0. Futures trade pulls back a bit following economic data, and now suggests a slightly lower open for the indices... Jan Personal Income has checked in down 2.3%, slightly better than expected, while Spending has come in unchanged (consensus +0.1%) after rising 0.8% last month... There have been no revisions to the prior month's data

8:00AM : S&P futures vs fair value: +0.1. Nasdaq futures vs fair value: +4.0. Futures market versus fair value suggesting a flat to modestly higher open for the cash market as investors await economic data and digest M&A news... FD has confirmed it will acquire MAY for $11 bln and YELL will acquire USFC for $1.37 bln while MYL has terminated its $4 bln agreement to buy KG and reports suggest Q will revise its offer for MCIP... Fresh four-month highs on crude oil prices to over $52/bbl, however, have weighed on pre-market action...

At 8:30 ET, Jan Personal Income (consensus -2.6%) and Spending (consensus +0.1%) will be released at 8:30 ET

6:18AM : FTSE...5007.70...+0.90...+0.0%. DAX...4361.92...+13.28...+0.3%.

6:18AM : S&P futures vs fair value: -0.3. Nasdaq futures vs fair value: +3.5.

6:18AM : Nikkei...11740.60...+82.35...+0.7%. Hang Seng...14195.35...+38.26...+0.3%.

[RawMaterials]

9. Copper Rises to Record in London on Japan's Industrial Output

Feb. 28 (Bloomberg) -- Copper reached a record high in London after Japan, the world's third-largest user, reported a bigger-than-expected increase in industrial production, signaling that demand for the metal may rise.

Copper for delivery in three months was up $41, or 1.3 percent, to $3,238 a metric ton on the London Metal Exchange at 10:36 a.m. It reached $3,275, the highest since the contract began trading in its current form in June 1986. The yen rallied, making copper cheaper to buy with the Japanese currency.

``Japan's industrial production in January is encouraging and that's driving copper higher,'' Liu Songtao, a trader at Dalu Futures Co., said from Beijing. ``If the dollar continues to slide, it's very likely we'll see copper trading at $3,500.''

Industrial production increased 2.1 percent from December, seasonally adjusted, Japan's Ministry of Economy, Trade and Industry said. Global copper use rose 7 percent last year to a record 16.4 million tons because of higher demand from China and Russia, exceeding new supplies by 579,000 tons, the U.K.-based World Bureau of Metal Statistics said in a report.

snipp..

Draining Inventory

Consumers have relied on stored metal as production lags demand. Inventory in LME warehouses has slid 88 percent since the start of 2004 to 53,975 tons, less than two days' global use.

Mining companies like BHP, Chile's state-owned Codelco and Phoenix-based Phelps Dodge Corp., the second-largest copper producer, are boosting output from mines including Escondida in Chile and Grasberg in Indonesia. Supplies from mines and scrap will rise 8.7 percent this year to 17 million tons, narrowing the gap with demand to 172,000 tons, Merrill Lynch & Co. forecast this month.

Hedge-fund managers and other large speculators increased their net-long position in New York copper futures by 34 percent in the week ended Feb. 22, according to U.S. Commodity Futures Trading Commission data.

Speculative long positions, or bets prices will rise, outnumbered short positions by 27,718 contracts on the Comex division of the New York Mercantile Exchange, the Washington- based commission said in its Commitments of Traders report.






http://www.bloomberg.com/apps/news?pid=10000086&sid=aydIPGHaXU10&refer=latin_america

[ozymandius]

11. 11:54 numbers

------------------------------------------------------------------------
 Market Summary
------------------------------------------------------------------------
Dow 10,795.05 -46.55 (-0.43%)
Nasdaq 2,056.39 -9.01 (-0.44%)
S&P 500 1,206.48 -4.89 (-0.40%)
10-Yr Bond 4.299% +0.03
NYSE Volume 654,082,000
Nasdaq Volume 925,272,000
------------------------------------------------------------------------

[ozymandius]

12. blather for you

Stocks Fall on Concerns About Inflation
Monday February 28, 11:11 am ET

Stocks Decline on Fresh Concerns About Higher Prices and Inflation, Threatening to Reverse Rally

NEW YORK (AP) -- Fresh concerns about higher prices and inflation pushed stocks modestly lower Monday, threatening to reverse last week's three-day rally. Trouble in the pharmaceutical sector also pressured the market.

ADVERTISEMENTWall Street was disappointed with the Commerce Department's latest reading on consumer income and spending. Personal income fell less than expected in January, but spending was flat and core consumer prices rose 0.3 percent -- the fastest rate in more than three years.

Crude oil prices also continued their march toward $52 per barrel, and stock investors worried that companies will have to start passing on higher transportation costs to consumers. A barrel of light crude was quoted at $51.65, up 16 cents, on the New York Mercantile Exchange.

more... (including good news)

http://biz.yahoo.com/ap/050228/wall_street_11.html

[ozymandius]

13. January Income Drop Not A Worry

(CBS/AP) Personal incomes which had been bolstered by a large stock dividend payment in December plunged 2.3 percent in January, the sharpest decline in more than a decade. Consumer spending was flat, the government reported Monday.

The Commerce Department said the sharp January drop in incomes followed a record 3.7 percent jump in incomes in December with both months heavily influenced by a $3 per share dividend payment that computer software giant Microsoft made on Dec. 2.

"It's nothing to worry about," Mark Zandi, chief economist of Economy.com, told CBS Radio News. "I think underlying income growth is solid, primarily because the job market is improving, we're creating lots of jobs, wage growth looks to at least have stabilized and the combination of both those things means more income for all of us."

-cut-

The worse-than-expected performance pushed new home sales down to 1.11 million units at a seasonally adjusted annual rate in January compared to a revised December rate of 1.22 million units. Last week, the National Association of Realtors reported that sales of existing homes and condominiums had fallen as well in January, dipping a slight 0.1 percent to a seasonally adjusted annual rate of 6.8 million units.

more...

http://www.cbsnews.com/stories/2005/02/28/ap/business/main676918.shtml

[ozymandius]

14. This should cause some worry. Check these numbers.

12:18
------------------------------------------------------------------------
 Market Summary
------------------------------------------------------------------------
Dow 10,763.05 -78.55 (-0.72%)
Nasdaq 2,047.90 -17.50 (-0.85%)
S&P 500 1,201.66 -9.71 (-0.80%)
10-Yr Bond 4.331% +0.06
NYSE Volume 756,822,000
Nasdaq Volume 1,048,305,000
------------------------------------------------------------------------

[ozymandius]

15. Just getting worse

12:27
------------------------------------------------------------------------
 Market Summary
------------------------------------------------------------------------
Dow 10,760.99 -80.61 (-0.74%)
Nasdaq 2,045.94 -19.46 (-0.94%)
S&P 500 1,201.18 -10.19 (-0.84%)
10-Yr Bond 4.333% +0.06
NYSE Volume 797,405,000
Nasdaq Volume 1,097,810,000
------------------------------------------------------------------------

[RawMaterials]

16. 12:52 side of blather

12:30PM : Renewed selling interest in equities, prompted by profit taking in energy stocks and a sell off in bonds, pushes the indices to their lowest levels of the session... The S&P Energy Index (-2.5%), which has soared nearly 22.0% in 2005 alone, has turned firmly negative over the last half hour as crude oil prices ($51.30/bbl -$0.19) have fallen... Extensive weakness in treasuries, subsequent to the resignation of Lebanon's government, has lifted yields on the 10-year note (-20/32) to 4.34%, rates not seen since late Dec. 2004, and also weighed on stocks...

Speculation of a large Euro/US trade running through a very thin market has also been cited as adding pressure to bonds...NYSE Adv/Dec 1277/1921, Nasdaq Adv/Dec 1053/1935

12:00PM : Major indices continue to sport widespread losses midday in the wake of mixed economic data, renewed inflation concerns and volatile oil prices despite strong M&A activity... Jan income fell a less than expected 2.3%, (consensus -2.6%) while personal spending was flat (consensus +0.1%)... However, the inflation indicator for consumer prices climbed 0.2% while the core PCE deflator rose 0.3%, the largest gain since Oct. 2001...

Feb Chicago PMI checked in at 62.7 (consensus 60.5), as both the production and new orders components rose to very strong 68.5 levels, but Jan new home sales dipped 9.2% to 1.106 mln (consensus 1.125 mln)... The latter has prompted profit taking in homebuilders (-1.3%) after last week's strong performance while investors overall have maintained a more cautious sentiment after the increase in a key measure of inflation... Biotech (-4.9%) has been the largest standout to the downside, and weighed on health care (-1.2%) and drug stocks (-0.5%), following Biogen Idec (BIIB 36.15 -31.13) and Elan Corp's (ELN 8.52 -18.38) voluntarily withdrawal of MS drug Tysabri...

Energy (-0.8%), which was strong early on as crude oil futures ($51.53/bbl +$0.04) neared $52/bbl, has since succumbed to some profit taking after it too is coming off a solid week of gains... Other areas under pressure have been airline, financial, materials, disk drive and semiconductor... Transportation (+0.8%), however, has been strong following Yellow Roadway's (YELL 58.97 -2.34) plans to acquire USF Corp (USFC 48.12 +9.30) for $1.37 bln while retail has found modest buying support now that Federated (FD 56.90 +0.11) has confirmed it will acquire May Dept. Stores (MAY 34.69 -0.66) for $11 bln...

Other M&A news includes Mylan (MYL 17.39 +0.45) has terminated its $4 bln agreement to buy King Pharmaceuticals (KG 9.48 -0.77)... Computer hardware and software have also posted modest gains... Meanwhile, all three of this morning's only worth earnings reports - Heinz (HNZ 37.91 +0.52), Nicor (GAS 37.36 +0.67) and TIF came in better than analysts expected, but downside guidance from Tiffany (TIF 30.26 -0.66) has pressured shares of the retailer... Treasuries have failed to benefit from this morning's mixed economic data as the 10-year note is now off 9 ticks to yield 4.29%, the benchmark's highest yields of the session... NYSE Adv/Dec 1570/1590, Nasdaq Adv/Dec 1259/1673

11:30AM : Still not much conviction this morning as weakness in biotech weighs on sentiment... Shares of both Biogen Idec (BIIB 36.06 -31.22) and Elan Corp (ELN 8.42 -18.48) have plummeted after the companies voluntarily withdrew multiple sclerosis (MS) drug Tysabri (which was cleared for marketing by the FDA in Nov.) following two serious adverse events - one patient died and another developed a serious central nervous system disease...

PDLI (-11.0%) has also fallen in sympathy while some rivals like TEVA (+6.9%), which markets a competitive Copaxone MS treatment, as well as SRA (+18.4%) and CHIR (+1.9%), have actually surged as Tysabri has been suspended until further notification... S&P Health Care Index -1.1%... ..DRG -0.4%...NYSE Adv/Dec 1569/1549, Nasdaq Adv/Dec 1255/1655

11:00AM : Market pares some of its losses and climbs to highs of the morning but still trades with a tinge of caution... Meanwhile, resurgence in M&A activity has helped minimize today's losses as strong balance sheets and confidence in management provide some modest support for equities... Federated Dept. Stores (FD 57.45 +0.66) has confirmed it will acquire May Dept. Stores (MAY 34.87 -0.48) for $11 bln...

Yellow Roadway (YELL 59.12 -2.19) has reached a definitive agreement to acquire USF Corp (USFC 48.18 +9.36) for $1.37 bln while reports suggest Qwest (Q 3.90 +0.04) is willing to revise its offer for MCI (MCIP 22.72 +0.12)... However, Mylan (MYL 17.44 +0.50) has terminated its $4 bln agreement to buy King Pharmaceuticals (KG 9.58 -0.67), but investors have applauded Mylan's decision as MYL shares have surged 3.0%...NYSE Adv/Dec 1508/1530, Nasdaq Adv/Dec 1253/1600

10:30AM : Stocks remain under pressure as Chicago PMI holds strong but new home sales fall... Feb Chicago PMI has checked in above the breakeven 50% mark for the 22nd consecutive month with a read of 62.7 (consensus 60.5), as both the production and new orders components rose to very strong 68.5 levels and employment rose 5 points to 57.7... The better than expected expansion in regional manufacturing activity should bode well for tomorrow's release of the ISM index (consensus 57.0)...

Jan new home sales, however, dipped 9.2% to 1.106 mln (consensus 1.125 mln) as the Dec gain was revised to 5.6% (from 0.1%)... The housing data, which are more volatile over the winter months, were reflected by an even wilder swing in pricing...NYSE Adv/Dec 1349/1619, Nasdaq Adv/Dec 1097/1634

10:00AM : Indices continue to sport modest losses early on as investors await another batch of economic data... Meanwhile, energy (+1.0%) continues to benefit from higher oil prices while semiconductor has extended last week's gains after the SOX (+0.6%) hit a new 2005 high on Friday and positive comments on Oracle (ORCL 13.22 +0.09) have given software a boost... Biotech (-4.2%), however has been hammered after Biogen Idec (BIIB 40.37 -26.91) and Elan (ELN 9.12 -17.78) pulled their MS drug Tysabri from the market...

Airline, transportation, financial, utility, homebuilding and materials have also been weak...NYSE Adv/Dec 1169/1362, Nasdaq Adv/Dec 1171/1334

9:40AM : Market shows little follow through, opening on a lower note, as inflation concerns resurface... While the underlying trends with regards to the Commerce Dept.'s earlier report were stable, Jan personal income and spending data were affected by monthly fluctuations... Jan income fell 2.3%, less than economists expected (consensus -2.6%), due to the downside of Microsoft's Dec dividend payment which left a 3.7% gain, while personal spending was flat (consensus +0.1%)...

More noteworthy was the inflation indicator (deflator) for personal spending, which climbed 0.2%, while the core deflator rose 0.3%, the largest gain since Oct. 2001, adding some interim inflation worries following the larger than expected Jan core PPI of +0.8%... At 10:00 ET, Feb Chicago PMI (consensus 60.5) and Jan New Home Sales (consensus 1125K) will be released...

9:15AM : S&P futures vs fair value: -1.8. Nasdaq futures vs fair value: -6.0. Expectations remain intact for stocks to open on a downbeat note... Still contributing to the modest weakness have been mixed economic data, downside guidance and and oil prices near $52/bbl

[RawMaterials]

17. 1:45 Number and Blather

Dow 10,752.04 -89.56 (-0.83%)
Nasdaq 2,042.42 -22.98 (-1.11%)
S&P 500 1,200.78 -10.59 (-0.87%)
10-Yr Bond 43.55 +0.83 (+1.94%)

NYSE Volume 1,041,123,000
Nasdaq Volume 1,370,769,000







1:30PM : More of the same as market internals remain firmly negative... Decliners on the NYSE hold a 20 to 11 edge over advancers while declining issues on the Nasdaq hold a 2 to 1 advantage over advancing issues... The ratio of down to up volume also reflects a similarly bearish bias on both the Big Board and Composite as down volumes hold a commanding edge over up volumes... While slightly stronger volume has returned, after a shortened week of limited participation, overall volume still remains a bit lighter than usual...

Meanwhile, the Nasdaq continues to vacillate near a secondary floor of support of 2046 while the S&P has found modest support around the 1201 level...NYSE Adv/Dec 1169/2088, Nasdaq Adv/Dec 1024/2031

1:00PM : Little changed since the last update as the major averages continue to vacillate in roughly the same ranges... With earnings season coming to a close, only three of this week's 16 S&P 500 constituents reported earnings this morning... Shares of HJ Heinz (HNZ 37.74 +0.35) have climbed after it beat Q3 earnings by a penny...

Nicor (GAS 37.17 +0.48) has also been strong, despite guiding FY05 EPS below consensus, after Q4 earnings of $1.08 handily beat forecasts of $0.86, while Tiffany (TIF 30.25 -0.67), despite beating forecasts by $0.02, has been under pressure after issuing downside Q1 guidance and guiding FY06 EPS in line with consensus...NYSE Adv/Dec 1156/2074, Nasdaq Adv/Dec 1003/2022

[jswordy]

18. New home sales analysis: What does the future hold?

NEW YORK (CNN/Money) - New home sales tumbled 9.2 percent in January, the government reported Monday, coming in well below Wall Street forecasts, and economists expressed mixed opinions about what was next for the nation's housing market.

Some analysts said a slowdown was coming, in what could be a worrisome sign for housing as well as the broader economy. But others noted the January declines were exacerbated by bad weather and weren't as bad as they first appeared.

The strong housing market has been a mainstay of support for the broader economy in recent years.

Sales of new one-family homes fell to a seasonally adjusted annual rate of about 1.11 million in January from a revised December rate of 1.22 million, the Commerce Department said.

Economists had estimated that new home sales would rise to a rate of about 1.13 million in January, according to a survey by Briefing.com.

"Today's number is a sign of slowing ahead," said Michael Darda, chief economist at MKM Partners. "But that's not a negative thing. With the dramatic price appreciation we've seen, we don't want to see a runaway market out of control."

http://money.cnn.com/2005/02/28/news/economy/new_homes/index.htm

[TrogL]

19. Loonie Watch

http://members.shaw.ca/trogl/looniewatch.html

Highlights.



http://www.x-rates.com/d/USD/CAD/data30.html

Detailed analysis (http://quotes.ino.com/chart/?s=CME_CDT4&v=s)


2005-01-28 Friday, January 28 0.805023 USD
2005-01-31 Monday, January 31 0.806712 USD
2005-02-01 Tuesday, February 1 0.806127 USD
2005-02-02 Wednesday, February 2 0.805932 USD
2005-02-03 Thursday, February 3 0.804894 USD
2005-02-04 Friday, February 4 0.80032 USD
2005-02-07 Monday, February 7 0.796052 USD
2005-02-08 Tuesday, February 8 0.801539 USD
2005-02-09 Wednesday, February 9 0.799297 USD
2005-02-10 Thursday, February 10 0.806062 USD
2005-02-11 Friday, February 11 0.807754 USD
2005-02-14 Monday, February 14 0.810241 USD
2005-02-15 Tuesday, February 15 0.810636 USD
2005-02-16 Wednesday, February 16 0.805088 USD
2005-02-17 Thursday, February 17 0.812348 USD
2005-02-18 Friday, February 18 0.813405 USD
2005-02-22 Tuesday, February 22 0.812942 USD
2005-02-23 Wednesday, February 23 0.806322 USD
2005-02-24 Thursday, February 24 0.804182 USD
2005-02-25 Friday, February 25 0.805997 USD
2005-02-28 Monday, February 28 0.813339 USD






It's been awhile so I thought I'd drop a quick one in. The loonie's been in the doldrums lately but is rising today against all currencies, especially the greenback. This could be a delayed reaction to the budget which had something for everybody, even the Conservatives (or whatever they're called this week).

[daleo]

20. Often the stock market likes a little bad news.

It dampens expectations of interest rate hikes, and thus returns on stocks look comparatively good. Today, this news (income and housing down) seems to be spooking them a little. Maybe just a blip, or maybe they see this as an alarming early indicator of a downturn.

[RawMaterials]

21. Americans' personal incomes take a dive

WASHINGTON - Personal incomes which had been bolstered by a large stock dividend payment in December plunged 2.3 percent in January, the sharpest decline in more than a decade. Consumer spending was flat, the government reported today.

The Commerce Department said the sharp January drop in incomes followed a record 3.7 percent jump in incomes in December with both months heavily influenced by a $3 per share dividend payment that computer software giant Microsoft made on Dec. 2.

Without that $32 billion payment, personal incomes would have shown steadier gains of 0.6 percent in December and 0.5 percent in January.

Personal spending was unchanged in January after having risen by 0.8 percent in December. This reflected the fact that demand for autos sagged last month as dealers removed attractive incentive offers they had used to spur end-of-the-year sales.

Consumer spending, which accounts for two-thirds of total economic activity, is expected to post solid gains again this year, bolstered by continued improvements in employment, but not quite up to the pace in 2004. Last year, consumer spending rose by 3.8 percent, helping to push overall economic growth up by 4.4 percent last year.

Economists are looking for both overall economic growth and consumer spending to slow a bit this year as continued interest rate increases from the Federal Reserve dampen consumer demand. The Fed hiked interest rates for a sixth time in early February and a seventh quarter-point increase is expected when Fed policy-makers next meet on March 22.

For January, consumer spending was held back by a big drop in demand for durable goods such as cars. It was the weakest showing since a 0.3 percent decline in June of last year.

After taking account of inflation, consumer spending actually fell by 0.2 percent in January.

Disposable, or after-tax incomes, fell by 2.6 percent last month after having shot up by 4.1 percent in December, changes that were also influenced by the Microsoft stock dividend payment.

The drop in disposable incomes pushed the savings rate down to 1 percent in January. Savings had jumped to 3.6 percent of disposable income in December, bolstered by the dividend payment, after having been at 0.5 percent for three straight months before that.



http://www.chron.com/cs/CDA/ssistory.mpl/business/3060646

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22. OPEC signals it wants high oil prices

PARIS (AFP) - OPEC (news - web sites) is sending out signals to the global market that the cartel wants oil prices, at near-record highs, to remain there this year.

Ali al-Nuaimi, oil minister for Saudi Arabia, OPEC's largest producer, made it clear on Thursday where he expects the US price of a barrel of crude to be: "The price today is between 40 to 50 dollars, and that's where it will probably stay during 2005."

These statements appear to confirm what analysts have predicted for several months: Riyadh has been changing its views on pricing, after having for a long time defended a price of 25 dollars a barrel.

At present, the price of crude based on OPEC calculations has increased to about the level indicated by the Saudi minister -- it closed Friday in New York at 51.49 dollars, while in London it sold for 49.61 dollars.

Several ministers in the Organization of Petroleum Exporting Countries have hinted at an increase in the past few months, but it was not clear where Saudi Arabia stood. For that reason, analysts have taken note of al-Nuaimi's recent remarks.




http://story.news.yahoo.com/news?tmpl=story&cid=1518&ncid=1518&e=6&u=/afp/20050227/bs_afp/energyoilopecprice_050227051620

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23. Closing Numbers and Blater on edit

Dow 10766.23 -75.37 (-0.70%)
Nasdaq 2051.72 -13.68 (-0.66%)
S&P 500 1203.60 -7.77 (-0.64%)
10-Yr Bond 4.359% +0.87

NYSE Volume 1,795,459,000
Nasdaq Volume 2,109,500,000

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25. Closing Blather

Close Dow -75.37 at 10766.23, S&P -7.77 at 1203.60, Nasdaq -13.68 at 2051.72: Renewed inflation worries following mixed economic data, coupled with another rise in oil prices, higher interest rates and hardly any upside catalysts aside from resurgence in M&A activity, overturned last week's three-day rally... Jan personal income fell 2.3%, less than economists expected (consensus -2.6%), due to the downside of Microsoft's Dec dividend payment which left a 3.7% gain, while personal spending was flat (consensus +0.1%)...

However, an increase of 0.2% in the inflation indicator for consumer prices and a 0.3% rise in the core PCE deflator, the largest increase since Oct. 2001, were slightly disconcerting given the 0.8% jump in January's core PPI data... Today's data, coupled with nervousness surrounding a slew of other important economic data out later this week, higher oil prices and higher bond yields, underpinned a cautious sentiment throughout the session... Crude oil futures, after surpassing $52/bbl in pre-market trade, closed up $0.26 at $51.75/bbl in volatile trading while treasuries closed near their lows of the session, with the benchmark 10-year note finishing off 23 ticks to yield 4.35%, rates not seen in three months...

Inflation issues, improving manufacturing conditions, the resignation of Lebanon's government and speculation of a large Euro/US trade running through very thin trading all contributed to pressure in bonds... Meanwhile, Feb Chicago PMI checked in at 62.7 (consensus 60.5), as both the production and new orders components rose to very strong 68.5 levels, but Jan new home sales unexpectedly dipped 9.2% to 1.106 mln (consensus 1.125 mln), as the Dec gain was revised to 5.6% (from 0.1%)...

Disappointing home sales and higher bond yields spurred profit taking in the homebuilding sector (-1.6%) following last week's stellar performance... Biotech (-5.5%), however, was hammered the hardest after Biogen Idec (BIIB 38.55 -28.73) and Elan Corp (ELN 8.03 -18.87) voluntarily withdrew their multiple sclerosis drug Tysabri following two serious adverse events (one death and one serious central nervous system disease)... After soaring nearly 22.0% in 2005 alone, investors finally booked some profits in energy stocks (-0.40%) while semiconductor (-1.4%) failed to take advantage of positive sector comments from Lehman...

Autos also plummeted after both General Motors (GM 35.65 -1.24) and Ford Motor (F 12.63 -0.37) were downgraded at Banc of America while an upgrade on Best Buy (BBY 54.02 +2.33) and strength in Wal-Mart (WMT 51.69 +0.20), following better than expected Feb comps growth of 4.0%, minimized losses in retail... Health care, financial, utility, materials and consumer staples were also influential leaders to the downside... Computer hardware (+1.4%), however, was lifted by strength in HPQ (+0.7%) and SUNW (+0.5%) while transportation (+0.3%) benefited from Yellow Roadway's (YELL 59.25 -2.06) proposed $1.37 bln acquisition of USF Corp (USFC 47.74 +8.92)...

Other notable merger news included confirmation that Federated (FD 55.50 -1.29) will acquire May Dept. Stores (MAY 34.55 -0.80) for roughly $11 bln while Mylan (MYL 17.60 +0.66) terminated its $4.0 bln agreement to buy King Pharmaceuticals (KG 9.48 -0.77)...DJTA +0.3, DJUA -0.9, DOT -0.1, Nasdaq 100 -1.0, Russell 2000 -0.6, SOX -1.5, S&P Midcap 400 -0.5, XOI -0.2, NYSE Adv/Dec 1307/2071, Nasdaq Adv/Dec 1313/1836

3:30PM : Indices trade at improved levels but still appear poised to finish in negative territory as buying interest remains scarce across the board heading into the close... Investors will get another read on manufacturing activity when the Feb ISM Index (consensus 57.0) is released tomorrow at 10:00 ET... Jan Construction Spending (consensus +0.4%) will also be out at 10:00 while Auto Sales (consensus 5.5 mln) and Truck Sales (consensus 7.9 mln) for the month of February are expected sometime after the market opens...

With earnings season slowing to a crawl, tomorrow will only showcase notable earnings from the likes of RRD and MMC (before the bell) while S&P components PLL and SBL will report after the close...NYSE Adv/Dec 1163/2161, Nasdaq Adv/Dec 1122/2006

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24. Treasuries Hit by Inflation Blow

NEW YORK (Reuters) - Most Treasuries prices slipped on Monday after an unexpectedly large rise in core U.S. inflation revived concerns that official interest rates might have to rise faster and farther than first thought.

The core price index for personal consumption expenditures rose 0.3 percent in January, above most expectations. Annual growth climbed to 1.6 from 1.5 percent, when most analysts had looked for a slight slowdown.

"This is a significant surprise, given that it is the price measure that the Fed and Greenspan in particular focuses on," said Alan Ruskin, research director at 4CAST. Fed Chairman Alan Greenspan is set to appear before the House Budget committee this Wednesday.

"The data is likely to affirm some views that inflation will only remain contained, if the Fed tightens substantially," said Ruskin. "It's a significant negative for the (yield) curve as a whole, especially the front-end."



http://www.reuters.com/newsArticle.jhtml?jsessionid=CG5H1C1NOUY14CRBAELCFEY?type=businessNews&storyID=7758932