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Federal Reserve Open Market Operations
The Fed's Open Market Operations desk performed 2 repurchase operations last night:
- a $5.25billion, overnight repurchase entirely undertaken in T-backed collateral ; and
- a $7billion, 14-day repurchase with $2.757billion in T-backed collateral.
And yet the response of the market was pretty underwhelming - although long positions established at 10 a.m. NY time had an opportunity to pocket about 3.5 points (the post-10 a.m. high was 1178, reached after the futures had dipped to 1.5 points below the 10 a.m. level of 1173.75). Still, that amount of repurchase dough ought really to have resulted in more of a move. As I said yesterday, something doesn't smell right.
Major US Indices
The "big news" of the day was after the market, when Microsoft reported its earnings for the quarter. They came in below the consensus guess of $0.33 a share, with earnings per share registering at $0.31 a share. Revenue was $10.8billion, which was higher than the consensus guess of $10.55 billion. In the aftermarket, MSFT shares were $0.20 higher than their closing level, so they must have said something that encouraged the sort of punter who trades on Instinet.
After showing considerable strength around the open, the indices were showing considerable weakness with a little under an hour to go. The Dow was down 78 points at 9 minutes past 3 NY time...
Then something happened - and if the SEC doesn't investigate it, then the SEC remains a lame duck (it's been my view since the year dot, that these regulators always end up being the be-yatch for whoever they're supposed to regulate... the head of the SEC is a former ticket-clipper, for God's sake).
Anyhow - what happened was, that MSFT's shares, which had been soft (down 16c) but not altogether weak, suddenly rocketed 30c in 18 minutes. That's what you might call the "Naughty Rene Effect" - somebody acting on information that's not generally available.
After that sudden burst upwards, the S&P and Nasdaq Comp got into the green for the day, but the Dow never got its head back above the UNCH line. By the close, the DJIA had fallen 31.19 points (0.3%) for the session, closing at 10467.4 points; the broader S&P500 added 0.48 points (0.04%), ending the day at 1174.55.
Over at Times Square, the Nasdaq Composite added 1.06 points (0.05%), to close at 2047.15, while larger-cap technology issues fared worse with the Nasdaq100 losing 1.46 points (0.1%), to end at 1507.55 points.
NYSE Volume was chunky, with 1.6 billion shares changing hands, while Nasdaq Volume was again over 2 billion, with 2.1 billion shares traded.
| Index | Close | Gain(Loss) | % |
| DJIA | 10467.4 | -31.19 | -0.3% |
| S&P500 | 1174.55 | 0.48 | 0.04% |
| Nasdaq Composite | 2047.15 | 1.06 | 0.05% |
| Nasdaq100 | 1507.55 | -1.46 | -0.1% |
| NYSE Volume | 1.6bn | - | - |
| Nasdaq Volume | 2.1bn | - | - |
Bellwethers
My 9-stock "bellwethers" group rose by an average of 0.18%
- Cisco Systems (CSCO) +$0.49 (2.77%) to $18.18;
- Ebay (EBAY) +$0.38 (0.46%) to $82.70;
- Citigroup (C) +$0.08 (0.17%) to $48.56;
- Wal Mart (WMT) -$0.20 (0.38%) to $53.08;
- IBM (IBM) +$0.03 (0.03%) to $91.98;
- General Electric (GE) +$0.12 (0.34%) to $35.61;
- Intel (INTC) -$0.11 (0.49%) to $22.31;
- Fannie Mae (FNM) -$0.99 (1.53%) to $63.56;
- Freddie Mac (FRE) +$0.15 (0.23%) to $65.80;
Market Breadth & Internals
NYSE advancing issues exceeded decliners by 1891 to 1412 for a single-day A/D reading of 479; and Nasdaq losers exceeded gainers by 1559 to 1480.
NYSE advancing volume exceeded volume in decliners by 921.21 to 664.82 million shares; Nasdaq advancing volume was greater than volume in decliners by 604.52 to 509.07 million shares.
114 NYSE-listed stocks rose to new 52-week highs, and 14 posted fresh 52-week lows, while on the Nasdaq there were 65 stocks that hit new 52-week highs, and 39 which fell to fresh 52-week lows.
| NYSE | Nasdaq | |
| Advancers | 1891 | 1480 |
| Decliners | 1412 | 1559 |
| Advancing Volume (m) | 921.21 | 604.52 |
| Declining Volume (m) | 664.82 | 509.07 |
| New Highs | 114 | 65 |
| New Lows | 14 | 39 |
Market Sentiment
[Commentary]
| Index | Close | Gain(Loss) | % |
| Equity Call Volume (000) | 2445.4 | -356.05 | -12.71% |
| Equity Put Volume (000) | 1723.45 | -141.86 | -7.61% |
| CBOE Volatility Index | 13.24 | -0.2 | -1.49% |
| CBOE Nasdaq Volatility Index | 18.58 | -0.34 | -1.8% |
| Equity Put-Call Ratio | 0.7 | 0.04 | 5.85% |
| SPX-VIX Ratio | 88.71 | 1.36 | 1.55% |
Bond Market Analysis
Bonds fell along the curve, but only modestly so at the long end. The yield on the benchmark 30-year Treasury bond rose 1.3 basis points to 4.676%.
| Index | Close | Gain(Loss) | % |
| UST 13wk (yld) | 2.387 | 0.02 | 0.93% |
| UST 2Y (yld) | 3.268 | 0.024 | 0.74% |
| UST 5Y (yld) | 3.736 | 0.02 | 0.57% |
| UST 10Y (yld) | 4.204 | 0.013 | 0.31% |
| UST 30Y (yld) | 4.676 | 0.013 | 0.28% |
The Banks Index slid 0.42 points (0.42%), closing at 100.07; within the index,
- Zions Bancorp (ZION) -$0.74 (1.09%) to $67.09;
- Bank Of NY (BK) -$0.32 (1.08%) to $29.28;
- Northern Trust (NTRS) -$0.47 (1.07%) to $43.59;
- Regions Financial (RF) -$0.31 (0.94%) to $32.84;
- MBNA Corp (KRB) -$0.22 (0.82%) to $26.48;
The Broker-dealer Index advanced 0.87 points (0.6%), to end the session at 147; the ticket clippers lined up as follows -
- E*Trade (ET) +$0.52 (4.02%) to $13.47;
- A G Edwards (AGE) +$0.46 (1.11%) to $41.91;
- Ameritrade (AMTD) +$0.09 (0.74%) to $12.30;
- Goldman Sachs (GS) +$0.74 (0.72%) to $104.00;
- Raymond James (RJF) +$0.21 (0.7%) to $30.18;
The Philadelphia SOX (Semiconductor) index added 3.61 points (0.9%), closing at 403.67
- Altera (ALTR) +$0.22 (1.2%) to $18.61;
- Freescale Semiconductor (FSL-B) +$0.67 (3.95%) to $17.63;
- Micron Technology (MU) +$0.32 (3.1%) to $10.63;
- Novellus Systems (NVLS) +$0.79 (3.05%) to $26.68;
- Applied Materials (AMAT) +$0.36 (2.23%) to $16.48;
Gold & Silver Markets
Gold fell by $0.5 (0.12%) to close at $426 per ounce - close to the top of the day's range ($424 - $426.50, although Gold did hit $428.10 during the overnight session).
The Gold Bugs Index advanced 0.23 points (0.11%), closing at 203.33
- Iamgold (IAG) +$0.15 (2.47%) to $6.23;
- Golden Star Resources (GSS) +$0.07 (1.88%) to $3.79;
- Hecla Mining (HL) +$0.05 (0.89%) to $5.69;
- Eldorado Gold (EGO) +$0.02 (0.74%) to $2.71;
- Agnico Eagle (AEM) +$0.08 (0.62%) to $12.90;
Silver rose $0.02 (0.29%) to close at $6.82 per ounce. The Gold and Silver Index (XAU) lost 0.43 points (0.46%), at 92.07 points.
- Placer Dome (PDG) -$0.28 (1.59%) to $17.29;
- Anglogold Ashanti (AU) -$0.46 (1.42%) to $32.00;
- Harmony Gold (HMY) -$0.10 (1.21%) to $8.15;
- Durban Roodepoert Deep (DROOY) -$0.01 (0.74%) to $1.34;
| Index | Close | Gain(Loss) | % |
| Gold | 426 | -0.5 | -0.12% |
| Silver | 6.82 | 0.02 | 0.29% |
| PHLX Gold and Silver Index | 92.07 | -0.43 | -0.46% |
| AMEX Gold BUGS Index | 203.33 | 0.23 | 0.11% |
Oil Market
Oil lost ground, shedding $0.37 per barrel, closing at $48.65 per barrel. Maybe Iraq's elections will not be an international crying stock (the idea of them ought to be a laughing stock, but too many people are being killed to really get a chuckle going). Still, the idea apparently, is that Iraqis will be free to vote for any of the parties that the US thinks should be allowed to be in the game, under threat of death if they get it wrong... sounds a lot like how life was under the supposed "tyrant' (and still President, in international law) Hussein, whose run rate (expressed in deaths of civilians per year) was not even a tenth of the run rate achieved by the "Coalition of the Killing".
Any soldier who dies (or gets maimed) in Iraq is the fault of the government who sent them, not the people who have taken up arms to run invaders out of their country; if you feel strongly that for some reason you ought to "support the troops", so so by agitating actively for them to be brought home and for those who sent them to be sent to the Hague to stand trial for War Crimes. Iraq 2003-05 = Poland and Czechoslovaki 1939; waging aggressive war is illegal whether God tells you to do it or not.
The Oil and Gas Index (XOI) added 2.75 points (0.37%), closing at 740.19
- Kerr Mcgee (KMG) +$1.26 (2.11%) to $60.89;
- Sunoco (SUN) +$1.24 (1.45%) to $86.56;
- Unocal (UCL) - former employer of US Afghan Stooge Hamid Karzai - up $0.50 (1.07%) to $47.44;
- BJ Services (BJS) +$1.65 (3.5%) to $48.86;
- Global Inds (GLBL) +$0.23 (2.99%) to $7.93;
- Halliburton (HAL) - former employer of War Criminal Dick Cheney - up $0.77 (1.8%) to $43.51;
| Index | Close | Gain(Loss) | % |
| Reuters CRB | 285.75 | -1 | -0.35% |
| Crude Oil Light Sweet | 48.65 | -0.37 | -0.75% |
| AMEX Oil Index | 740.19 | 2.75 | 0.37% |
| Oil Service Index | 130.02 | 1.51 | 1.18% |
Currency Markets
| Index | Close | Gain(Loss) | % |
| US Dollar Index | 83.48 | 0.1 | 0.12% |
| Euro | 1.3032 | -0.0039 | -0.3% |
| Yen | 103.1 | -0.03 | -0.03% |
| Sterling | 1.8875 | 0.006 | 0.32% |
| Australian Dollar | 0.7765 | 0.0029 | 0.37% |
| Swiss Franc | 1.1847 | 0.0008 | 0.07% |
| Canadian Dollar | 0.8075 | -0.0032 | -0.39% |
European Markets
France's benchmark CAC-40 Index rose 11.58 points (0.3%), to end the session at 3891.4 points; the German DAX-30 Index rose 2.29 points (0.05%), at 4216.41; and in the UK, the FTSE-100 Index added 6.3 points (0.13%), to 4853.4 points.
| Index | Close | Gain(Loss) | % |
| CAC-40 | 3891.4 | 11.58 | 0.3% |
| DAX-30 | 4216.41 | 2.29 | 0.05% |
| FTSE-100 | 4853.4 | 6.3 | 0.13% |
Tonight's Pivots (US Futures Market)
| Dow | S&P500 | Nasdaq | Bonds | |
| R2 | 10522 | 1182.07 | 1525.5 | 114 7/32 |
| R1 | 10493 | 1178.53 | 1516.5 | 114 2/32 |
| Pivot | 10459 | 1174.47 | 1508.5 | 113 23/32 |
| S1 | 10430 | 1170.93 | 1499.5 | 113 18/32 |
| S2 | 10396 | 1166.87 | 1491.5 | 113 7/32 |
