Wednesday, October 17, 2007

Roller Coaster Day for US Stocks

Talk about volatility! The Dow Jones Industrials took a 21-point round-trip, finally ending the session with the third straight loss for the index of 30 blue chip stocks.

Dow 13,892.54 -20.40; NASDAQ 2,792.67 +28.76; S&P 500 1,541.24 +2.71; NYSE Composite 10,165.30 +39.90

Stocks soared early in the day - with the Dow up by more than 100 points - on earnings reports, primarily, from tech stalwarts Intel (INTC) and Yahoo (YHOO), which reported strong earnings after the close on Tuesday and Coca-Cola, which beat estimates for the 3rd quarter.

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However, the celebration was short-lived as spiking oil prices and continuing concerns in credit and mortgage markets rattled investors. Slow software sales from IBM and a word from the CEO of United Technologies, who said 2008 would be "challenging," sent those two Dow components reeling.

Advancers and decliners finished virtually in a dead heat, with gainers showing a slight advantage. New lows eked out a win over new highs, 259-249.

Oil was lower by 21 cents, gold and silver registered marginal gains.

Earnings continue to come in weaker than expected and with continuing concerns in the housing and credit sectors, investor mood is quite dour. Even though techs remain a bright spot, retailers and mainstream industrials are returning very poor 3rd quarter performances.

Despite pontifications from Sir Alan Greenspan that there's only a 50/50 chance of a recession, one ponders the former Fed Chief's past performance and overall reputation, which has been severely tarnished of late. Concerns are abundant that not only will the US fall into recession, but that it will be a particularly long and deep one.

Keep that in mind with your trades on Thursday and Friday. This is no time to be overly optimistic.

NYSE Volume 3,638,064,750
NASDAQ Volume 2,440,087,250

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