Monday was the bump higher, Tuesday and Wednesday turned out to be significant grinders as investors regained confidence and continued to scoop up stocks since there's nothing else to buy besides maybe gold and treasuries, and the latter isn't granting much of a return these days.
Speculation is back in vogue, now that the latest crisis has passed from public view, though there will certainly be issues going forward, as always.
Dow 10,896.91, +148.65 (1.38%)
NASDAQ 2,425.02, +49.71 (2.09%)
S&P 500 1,171.67, +15.88 (1.37%)
NYSE Composite 7,316.36, +94.70 (1.31%)
Once again, advancing issues finished far ahead of decliners, 5470-1122; 195 new highs outpaced just 58 new lows. As much as the rally seemed vibrant and flourishing, volume declined for the third straight day, reinforcing the notion that while all the attention was focused on stocks going higher, there were wise guys taking some slivers of profit while the herd pushed to the extremes.
NYSE Volume 5,929,432,500.00
NASDAQ Volume 2,308,404,000.00
Gold continued to dominate the commodity space, breaking through to fresh all-time highs, another sign that global economies aren't quite as fit as their leaders would have you believe. The shiny stuff was up another $22.80, to $1,242.70 on the day. Silver gained 37 cents, to finish at $19.64. The metals have parted ways with oil significantly this week, as crude fell 72 cents to $75.65, while motorists are still anxiously awaiting a similar price reduction at the pump.
Despite the coming arrival of summer, oil, if the price were not so ham-handedly manipulated, could reach even lower levels around the $60/barrel mark by mid-July, though the sheiks and barons probably won't allow that to occur, instead focusing on limiting supply and choking consumers. Gold will continue to rocket higher in coming months unless sovereign economies actually discover fiscal integrity - an unlikely occurrence.
Wednesday, May 12, 2010
Tuesday, May 11, 2010
Hot Flashes and Mood Swings; Gold Shines
Financial markets continued to behave in disorganized, semi-rational manners.
Prior to the opening bell, stock futures were pointing toward a heavy downdraft, with Dow futures predicting close to a 100-point gap lower at the open and that is roughly where it stood, making what would turn out to be the low point of the day just five minutes into the trading day.
Stocks gained steadily until reaching a peak just before 2:00 pm and then relented, sliding steadily downward into the close. This is the second day in a row which has witnessed large opening gaps - Monday's to the upside and of greater magnitude, today's lower - which benefit only the most adroit professionals and are a bane to the small investor.
Volatility, though subdued when compared to the final two days of the prior week, remains at elevated levels and volume dropped off for the second straight session.
What the markets are attempting to digest is a spate of conflicting events concerning Europe and the bailout of Greece, changing politics in Great Britain, the continuing unnatural disaster from the oil spill in the Gulf of Mexico and a reft of economic data and information that is not easily deciphered.
Housing and unemployment remain as the great contradictory indicators to a general recovery. Without a meaningful rebound in home-buying and employment, any hope for sustained prosperity seem overblown. The nearly $1 trillion thrown at the monetary crisis in Europe is being regarded widely as nothing more than a temporary fix with structural problems as yet not addressed.
The huge bulk of unfunded future liabilities mostly in the form of pensions and health services are keeping a lid on the economies of European nations as well as the United States. Massive government current deficits are already strangling state budgets. In New York, efforts are underway to overturn portions of the state budget which calls for one-day-a-week furloughs for state employees. The budget and the measure was passed on Monday night by the state legislature, at the urging of lame-duck governor David Patterson.
Meanwhile, hearigs were underway in washington, D.C. and New Orleans, concerning Thursday's stock market "flash crash" and the events leading up to an immediately following the oil rig explosion which caused the continuing oil spill of the Louisiana coastline (see video at end of this post).
Dow 10,748.26, -36.88 (0.34%)
NASDAQ 2,375.31, +0.64 (0.03%)
S&P 500 1,155.79, -3.94 (0.34%)
NYSE Composite 7,221.66, -35.96 (0.50%)
Advancing issues outpaced declines on the day, 3719-2812; new highs surpassed new lows, 166-62. Volume was lower for the second straight session.
NYSE Volume 6,583,789,500.00
NASDAQ Volume 2,484,207,000.00
The big winner on the day was gold, which shot up $19.50, to $1,219.90, closing at an all-time high. Silver tagged along, rising 74 cents, to $19.27. Crude oil futures finished the day 43 cents to the downside, at $76.37.
What's moving markets, now that second quarter earnings releases have been pretty much digested, are the markets themselves. Momentum trading is in vogue as equities seek direction. It's a turbulent time not only for stocks, but for stock-watchers as well.
Prior to the opening bell, stock futures were pointing toward a heavy downdraft, with Dow futures predicting close to a 100-point gap lower at the open and that is roughly where it stood, making what would turn out to be the low point of the day just five minutes into the trading day.
Stocks gained steadily until reaching a peak just before 2:00 pm and then relented, sliding steadily downward into the close. This is the second day in a row which has witnessed large opening gaps - Monday's to the upside and of greater magnitude, today's lower - which benefit only the most adroit professionals and are a bane to the small investor.
Volatility, though subdued when compared to the final two days of the prior week, remains at elevated levels and volume dropped off for the second straight session.
What the markets are attempting to digest is a spate of conflicting events concerning Europe and the bailout of Greece, changing politics in Great Britain, the continuing unnatural disaster from the oil spill in the Gulf of Mexico and a reft of economic data and information that is not easily deciphered.
Housing and unemployment remain as the great contradictory indicators to a general recovery. Without a meaningful rebound in home-buying and employment, any hope for sustained prosperity seem overblown. The nearly $1 trillion thrown at the monetary crisis in Europe is being regarded widely as nothing more than a temporary fix with structural problems as yet not addressed.
The huge bulk of unfunded future liabilities mostly in the form of pensions and health services are keeping a lid on the economies of European nations as well as the United States. Massive government current deficits are already strangling state budgets. In New York, efforts are underway to overturn portions of the state budget which calls for one-day-a-week furloughs for state employees. The budget and the measure was passed on Monday night by the state legislature, at the urging of lame-duck governor David Patterson.
Meanwhile, hearigs were underway in washington, D.C. and New Orleans, concerning Thursday's stock market "flash crash" and the events leading up to an immediately following the oil rig explosion which caused the continuing oil spill of the Louisiana coastline (see video at end of this post).
Dow 10,748.26, -36.88 (0.34%)
NASDAQ 2,375.31, +0.64 (0.03%)
S&P 500 1,155.79, -3.94 (0.34%)
NYSE Composite 7,221.66, -35.96 (0.50%)
Advancing issues outpaced declines on the day, 3719-2812; new highs surpassed new lows, 166-62. Volume was lower for the second straight session.
NYSE Volume 6,583,789,500.00
NASDAQ Volume 2,484,207,000.00
The big winner on the day was gold, which shot up $19.50, to $1,219.90, closing at an all-time high. Silver tagged along, rising 74 cents, to $19.27. Crude oil futures finished the day 43 cents to the downside, at $76.37.
What's moving markets, now that second quarter earnings releases have been pretty much digested, are the markets themselves. Momentum trading is in vogue as equities seek direction. It's a turbulent time not only for stocks, but for stock-watchers as well.
| Oil spill video: Times-Picayune Tuesday update |
Monday, May 10, 2010
Euro Bailout Revives Markets... and How!
If anyone was thinking the markets couldn't get any more extreme than they did last week, Monday morning's festival of funding, courtesy of the European Union and the IMF, to the tune of nearly $1 Trillion.
According the the Wall Street Journal:
Most of the gains came right at the open, which kept individual investors shut out for the most part. The major indices gapped up within 5 minutes of the open by roughly 4%.
Following Thursday's "magic moments," which witnessed a drop and subsequent rebound on the Dow in a matter of less than 15 minutes, market observers have plenty reason for skepticism. After Bob Brinker called the Thursday move, "manipulation," veteran trader Art Cashin, head of floor operations at UBS, said live on CNBC, referring to Friday's non-farm payroll report, "188,000 was a guess by the Bureau of Labor Statistics." Further, he said, "keep your eye on the referee. This game isn't on the up and up," referring to possibly the entire market.
All of this market volatility should come as no surprise to anybody who's been following the financial crisis over the past 2 1/2 - 3 years. Nations, and their political leaders, have a vested interest in keeping their worthless currencies in play, regardless the consequences down the road. Mountains of debt have been piled upon other mountains of debt around the world. The EU bailout was a long time in coming and a hard morsel to chew on for beleaguered leaders. Essentially, they had no choice, though the future seems as uncertain as ever, if not more so.
Stocks bounded higher in Europe and the US, with the average index gaining somewhere between 3 and 5 percent. Asian markets were more subdued, excepting Indonesia and India, which were both highr by 3 1/2 to 4%.
As usual, bank stocks - both in the US and in Europe - led the advance.
Dow 10,785.14, + 404.71 (3.90%)
NASDAQ 2,374.67, +109.03 (4.81%)
S&P 500 1,159.73, +48.85 (4.40%)
NYSE Composite 7,257.62, +341.44 (4.94%)
Advancing issues led decliners by an enormous margin, 6036-696. New highs regained their edge over new lows, though not my a meaningful margin, considering the momentous advance. There were 143 new highs to just 37 new lows. The idea that there were any new lows at all was remarkable, and also notable was the volume, at lower levels than on most of last week's down days.
NYSE Volume 7,876,002,500.00
NASDAQ Volume 2,858,059,750.00
Chances are good that throwing a trillion dollars at Europe's problems will stabilize markets for a while, but, like their TARP counterpart in the fall of 2008, the effects could be very short-lived. As with the TARP in the US, the average European citizen will not likely embrace the bailout of banks and government while the populace goes hungry.
Commodities were mixed on the news. Oil regained some of what it lost over the past week, gaining $1.69, to $76.80, but gold was down $9.60, to $1,200.40. Silver slit the difference, gaining 10 cents, to $18.53.
Largely ignored were two items: Ratings agency, Moody's, received a Wells Notice from the SEC, signaling that enforcement action was forthcoming; Fannie Mae posted a $13 billion loss for the first quarter and asked for another $8.4 billion in federal assistance.
One thing that seems certain: The comparisons of Wall Street to Las Vegas are unfair. Las Vegas is a much more friendly place for individuals. The odds stay the same and the rules don't change over the weekend. These comparisons are only giving Las Vegas - a place where anyone and everyone gets a fair shake - a bad name and should cease. We'd like to call Wall Street a den of wolves, but we actually like wolves.
According the the Wall Street Journal:
The U.S. market's surging open followed strong gains in the Asian and European markets after the European Union agreed to a EUR750 billion ($955 billion) bailout, including EUR440 billion of loans from euro-zone governments, EUR60 billion from a European Union emergency fund and EUR250 billion from the International Monetary Fund.
Most of the gains came right at the open, which kept individual investors shut out for the most part. The major indices gapped up within 5 minutes of the open by roughly 4%.
Following Thursday's "magic moments," which witnessed a drop and subsequent rebound on the Dow in a matter of less than 15 minutes, market observers have plenty reason for skepticism. After Bob Brinker called the Thursday move, "manipulation," veteran trader Art Cashin, head of floor operations at UBS, said live on CNBC, referring to Friday's non-farm payroll report, "188,000 was a guess by the Bureau of Labor Statistics." Further, he said, "keep your eye on the referee. This game isn't on the up and up," referring to possibly the entire market.
All of this market volatility should come as no surprise to anybody who's been following the financial crisis over the past 2 1/2 - 3 years. Nations, and their political leaders, have a vested interest in keeping their worthless currencies in play, regardless the consequences down the road. Mountains of debt have been piled upon other mountains of debt around the world. The EU bailout was a long time in coming and a hard morsel to chew on for beleaguered leaders. Essentially, they had no choice, though the future seems as uncertain as ever, if not more so.
Stocks bounded higher in Europe and the US, with the average index gaining somewhere between 3 and 5 percent. Asian markets were more subdued, excepting Indonesia and India, which were both highr by 3 1/2 to 4%.
As usual, bank stocks - both in the US and in Europe - led the advance.
Dow 10,785.14, + 404.71 (3.90%)
NASDAQ 2,374.67, +109.03 (4.81%)
S&P 500 1,159.73, +48.85 (4.40%)
NYSE Composite 7,257.62, +341.44 (4.94%)
Advancing issues led decliners by an enormous margin, 6036-696. New highs regained their edge over new lows, though not my a meaningful margin, considering the momentous advance. There were 143 new highs to just 37 new lows. The idea that there were any new lows at all was remarkable, and also notable was the volume, at lower levels than on most of last week's down days.
NYSE Volume 7,876,002,500.00
NASDAQ Volume 2,858,059,750.00
Chances are good that throwing a trillion dollars at Europe's problems will stabilize markets for a while, but, like their TARP counterpart in the fall of 2008, the effects could be very short-lived. As with the TARP in the US, the average European citizen will not likely embrace the bailout of banks and government while the populace goes hungry.
Commodities were mixed on the news. Oil regained some of what it lost over the past week, gaining $1.69, to $76.80, but gold was down $9.60, to $1,200.40. Silver slit the difference, gaining 10 cents, to $18.53.
Largely ignored were two items: Ratings agency, Moody's, received a Wells Notice from the SEC, signaling that enforcement action was forthcoming; Fannie Mae posted a $13 billion loss for the first quarter and asked for another $8.4 billion in federal assistance.
One thing that seems certain: The comparisons of Wall Street to Las Vegas are unfair. Las Vegas is a much more friendly place for individuals. The odds stay the same and the rules don't change over the weekend. These comparisons are only giving Las Vegas - a place where anyone and everyone gets a fair shake - a bad name and should cease. We'd like to call Wall Street a den of wolves, but we actually like wolves.
Sunday, May 9, 2010
Bob Brinker Calls Market Turmoil "Manipulation"
Over the weekend, Bob Brinker, host of the nationally-syndicated financial talk show, Money Talk, characterized the market turmoil of this past Thursday, May 6, 2010, as "manipulation," which has been the stance of this blog since the event occurred.
This may be a notable development, though likely it is not, in that whereas, I, a blogger without an enormous following, have mentioned the manipulation of the stock market numerous times over the past few years without fanfare, but when a national radio host with the reputation and longevity of a Bob Brinker says the very same thing about a specific situation, there may be something to it.
Brinker did not elaborate on who might be doing the manipulation, but the mere fact that he used the word, was something of a shock. My gut feeling is that if Bob Brinker thinks the market was manipulated this past Thursday, then there are surely others who believe the same or at least are thinking along the same lines.
Is Brinker spreading fear uncertainty and doubt (FUD) recklessly, or issuing a heartfelt, albeit shrouded, warning to his loyal listeners? Really makes one wonder about what's really going on with the barons of finance and the Wall Street crowd.
This may be a notable development, though likely it is not, in that whereas, I, a blogger without an enormous following, have mentioned the manipulation of the stock market numerous times over the past few years without fanfare, but when a national radio host with the reputation and longevity of a Bob Brinker says the very same thing about a specific situation, there may be something to it.
Brinker did not elaborate on who might be doing the manipulation, but the mere fact that he used the word, was something of a shock. My gut feeling is that if Bob Brinker thinks the market was manipulated this past Thursday, then there are surely others who believe the same or at least are thinking along the same lines.
Is Brinker spreading fear uncertainty and doubt (FUD) recklessly, or issuing a heartfelt, albeit shrouded, warning to his loyal listeners? Really makes one wonder about what's really going on with the barons of finance and the Wall Street crowd.
Friday, May 7, 2010
Wall Street Whacked Again; Europe Overwhelms Positive Employment and Gulf Oil Spill
Following the worst recession since the Great Depression, the bulk of Americans still suffering through the slow, painful "recovery" process probably is cheering every daily decline in the stock market. Where Main Street to a large extent has plumbed the depths of poverty, Wall Street has had the pleasure of using taxpayer dollars to dig their way out of the mess they themselves caused, so it's not surprising that after Thursday's "fat finger" debacle many Americans are throwing a fat finger right back at the titans of finance and their profligate ways.
News outlets claimed that a mistaken trade, hitting a a "B" instead of an "M" - as in billions vs. millions of shares - caused yesterday's 998 point plummet, thus the "fat finger" excuse, which, by the way, has been largely discredited. The truth of what happened on May 6, 2010 may never be fully known, but the idea that insiders purposely sold huge quantities in a coordinated assault has some merit.
The goal of the traders causing the plunge (probably computer programmed) was to sell enough shares of enough companies to trigger momentum trading by other computers and individuals in addition to triggering stop loss trades that would exacerbate the situation. Then, as the market plunged, notably to almost a 1000-point loss on the Dow, scoop up quantities of the same stocks after their values had been decimated, in effect, reversing the old saw of "buy low, sell high," on its head, selling high and the buying low.
If this was a coordinated, widely-spread-out trading scheme - and there's no evidence indicating that it wasn't - it seemed to have worked to perfection. Two other elements lead one to believe that it could also have been a staged event. First, the near-1000-point drop bottomed just after 2:30. Had it occurred before that time and gone down more than 1000 points, the NYSE would have shut down. Likely not wanting to tempt fate, the schemers plied their scam just after 2:30 and stopped the skid just before the 1000-point-down level was attained.
Second, CNBC and networks worldwide were airing scenes of protesters in Greece being beaten back and dispersed by riot police at precisely the moment the stock market was skidding out of control. If this were labeled a terror attack, it would fit the definition precisely, because it terrorized not only people invested or watching on TV, but the traders on the floor and in brokerages around the world.
Additionally, CNBC had commentators in place in Greece and on the Iberian peninsula, plus they brought Jim Cramer (Mad Money) onto the set for a rare appearance. At the depth of the decline, host Erin Burnett brought up a chart of Proctor Gamble, which had plunged some 20 points in a manner of minutes. Cramer cooly called it a buy and it immediately reversed course and headed back near the unchanged mark.
Commentators on CNBC also started the "fat finger" rumor and produced an additional three hours of coverage later in the evening, complete with "Markets in Turmoil" graphics and coverage from around the financial universe.
So, was the sudden collapse and subsequent, immediate 600-point rally all about finances or all about ratings? The timing seemed to synch perfectly with the anarchist overtones emanating from Athens, and the swiftness of the entire affair (less than 20 minutes) was riveting television. CNBC reported today that their web site traffic shot through the roof during and after the event.
Whatever the cause of Thursday's melt down and up, the message was loud and clear: something is amiss on Wall Street when stocks can go to zero in the space of a couple of heartbeats and nobody knows exactly why. Investors were skittish and tentative on Friday, even after the government produced the best non-farm payroll report in four years.
The employment report for April showed the US economy creating 290,000 jobs in April, with only 66,000 of those coming in the form of temporary census workers. The BLS also upgraded the previous two months, showing even more job growth than had previously been reported. That kind of upbeat news still could not shake off the tremors from Thursday's wild ride nor the unsettled affairs in Greece and across Europe, where LIBOR (London InterBank Overnight Rate) - the rate of interest banks charge each other for overnight loans - shot up dramatically.
As the European overtone kept markets subdued, US bond yields held steady or declined and the dollar gained against most other currencies, expressing the view that the United States was the best of a bad bunch as far as investments were concerned. With all the reporting on Wall Street and Europe overwhelming the news wires, the story of oil continually gushing into the Gulf - with the oil slick making landfall yesterday in Louisiana - was sadly sent to a back burner.
Traders were extremely cautious though not entirely on the sell side. The Dow dropped 279 points early in the day before rallying briefly into positive territory just 45 minutes later. The rally had no momentum, however, and stocks sold off in jumpy fashion through the remainder of the session.
Dow 10,380.43, -139.89 (1.33%)
NASDAQ 2,265.64, -54.00 (2.33%)
S&P 500 1,110.88, -17.27 (1.53%)
NYSE Composite 6,916.18, -95.74 (1.37%)
Market internals confirmed the ugly truth. Advancers were once again beaten severely by decliners, 4838-1775, and new lows exceeded new highs for the second straight day, 184-94, a significant development, signaling, in very certain terms, a continuance of the downturn. Volume was once again at fantastic heights, similar to Thursday's trading. It's obvious that much of the smart money has been heading for the exits en masse over the past two weeks and now the dumb money is following.
NYSE Volume 10,830,781,000.00
NASDAQ Volume 4,174,408,500.00
The unsettled nature of trading and uncertain future for Europe took oil down yet another notch, with crude futures closing down $2.00, to $75.11. The metals have divorced themselves from the energy complex, with gold rallying another $13.40, to $1,210.00, and silver adding 94 cents, to $18.43. Wall Street's high-velocity, highly volatile trading suggests that gold will continue to be a safe haven for wealth.
The week was among the ten worst ever for stocks, with the Dow suffering a 628-point decline. All of the major indices closed today at levels below the start of the year. They are all in negative territory for 2010.
The Dow Jones Industrials are down 7.4% from their April 26 high of 11,205.03. The NASDAQ is already technically in a correction, having fallen 10.5% from its recent high, while the S&P 500 is off 8.8%.
Stop losses? Maybe it's time to stop trading equities for the relative safety of bonds and metals. Unless conditions in various locales improve remarkably over the coming weeks, this slide should eviscerate much of the progress made in 2009. Think Dow 9000 and possibly lower, near-to-medium term.
News outlets claimed that a mistaken trade, hitting a a "B" instead of an "M" - as in billions vs. millions of shares - caused yesterday's 998 point plummet, thus the "fat finger" excuse, which, by the way, has been largely discredited. The truth of what happened on May 6, 2010 may never be fully known, but the idea that insiders purposely sold huge quantities in a coordinated assault has some merit.
The goal of the traders causing the plunge (probably computer programmed) was to sell enough shares of enough companies to trigger momentum trading by other computers and individuals in addition to triggering stop loss trades that would exacerbate the situation. Then, as the market plunged, notably to almost a 1000-point loss on the Dow, scoop up quantities of the same stocks after their values had been decimated, in effect, reversing the old saw of "buy low, sell high," on its head, selling high and the buying low.
If this was a coordinated, widely-spread-out trading scheme - and there's no evidence indicating that it wasn't - it seemed to have worked to perfection. Two other elements lead one to believe that it could also have been a staged event. First, the near-1000-point drop bottomed just after 2:30. Had it occurred before that time and gone down more than 1000 points, the NYSE would have shut down. Likely not wanting to tempt fate, the schemers plied their scam just after 2:30 and stopped the skid just before the 1000-point-down level was attained.
Second, CNBC and networks worldwide were airing scenes of protesters in Greece being beaten back and dispersed by riot police at precisely the moment the stock market was skidding out of control. If this were labeled a terror attack, it would fit the definition precisely, because it terrorized not only people invested or watching on TV, but the traders on the floor and in brokerages around the world.
Additionally, CNBC had commentators in place in Greece and on the Iberian peninsula, plus they brought Jim Cramer (Mad Money) onto the set for a rare appearance. At the depth of the decline, host Erin Burnett brought up a chart of Proctor Gamble, which had plunged some 20 points in a manner of minutes. Cramer cooly called it a buy and it immediately reversed course and headed back near the unchanged mark.
Commentators on CNBC also started the "fat finger" rumor and produced an additional three hours of coverage later in the evening, complete with "Markets in Turmoil" graphics and coverage from around the financial universe.
So, was the sudden collapse and subsequent, immediate 600-point rally all about finances or all about ratings? The timing seemed to synch perfectly with the anarchist overtones emanating from Athens, and the swiftness of the entire affair (less than 20 minutes) was riveting television. CNBC reported today that their web site traffic shot through the roof during and after the event.
Whatever the cause of Thursday's melt down and up, the message was loud and clear: something is amiss on Wall Street when stocks can go to zero in the space of a couple of heartbeats and nobody knows exactly why. Investors were skittish and tentative on Friday, even after the government produced the best non-farm payroll report in four years.
The employment report for April showed the US economy creating 290,000 jobs in April, with only 66,000 of those coming in the form of temporary census workers. The BLS also upgraded the previous two months, showing even more job growth than had previously been reported. That kind of upbeat news still could not shake off the tremors from Thursday's wild ride nor the unsettled affairs in Greece and across Europe, where LIBOR (London InterBank Overnight Rate) - the rate of interest banks charge each other for overnight loans - shot up dramatically.
As the European overtone kept markets subdued, US bond yields held steady or declined and the dollar gained against most other currencies, expressing the view that the United States was the best of a bad bunch as far as investments were concerned. With all the reporting on Wall Street and Europe overwhelming the news wires, the story of oil continually gushing into the Gulf - with the oil slick making landfall yesterday in Louisiana - was sadly sent to a back burner.
Traders were extremely cautious though not entirely on the sell side. The Dow dropped 279 points early in the day before rallying briefly into positive territory just 45 minutes later. The rally had no momentum, however, and stocks sold off in jumpy fashion through the remainder of the session.
Dow 10,380.43, -139.89 (1.33%)
NASDAQ 2,265.64, -54.00 (2.33%)
S&P 500 1,110.88, -17.27 (1.53%)
NYSE Composite 6,916.18, -95.74 (1.37%)
Market internals confirmed the ugly truth. Advancers were once again beaten severely by decliners, 4838-1775, and new lows exceeded new highs for the second straight day, 184-94, a significant development, signaling, in very certain terms, a continuance of the downturn. Volume was once again at fantastic heights, similar to Thursday's trading. It's obvious that much of the smart money has been heading for the exits en masse over the past two weeks and now the dumb money is following.
NYSE Volume 10,830,781,000.00
NASDAQ Volume 4,174,408,500.00
The unsettled nature of trading and uncertain future for Europe took oil down yet another notch, with crude futures closing down $2.00, to $75.11. The metals have divorced themselves from the energy complex, with gold rallying another $13.40, to $1,210.00, and silver adding 94 cents, to $18.43. Wall Street's high-velocity, highly volatile trading suggests that gold will continue to be a safe haven for wealth.
The week was among the ten worst ever for stocks, with the Dow suffering a 628-point decline. All of the major indices closed today at levels below the start of the year. They are all in negative territory for 2010.
The Dow Jones Industrials are down 7.4% from their April 26 high of 11,205.03. The NASDAQ is already technically in a correction, having fallen 10.5% from its recent high, while the S&P 500 is off 8.8%.
Stop losses? Maybe it's time to stop trading equities for the relative safety of bonds and metals. Unless conditions in various locales improve remarkably over the coming weeks, this slide should eviscerate much of the progress made in 2009. Think Dow 9000 and possibly lower, near-to-medium term.
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