Wednesday, January 16, 2008
The Pain Continues
The Bears dominated trading Tuesday with negative economic news and dismal earnings to blame. The Dow fell 277.04 points to close at 12,501.11. The SPX gave up 35.30 points closing at 1,380.95. We are safely in the green with the money in the bank.
There wasn’t much news to get excited about Tuesday with retail sales falling and Citigroup (C) reporting disappointing earnings. The only bright spot was that producer prices didn’t rise as much as expected, leaving an emergency rate cut by the Fed a strong possibility.
Economic news was also a major problem for the bulls Tuesday, with weaker than expected retail sales data for December. After what was a rather strong November heading into the holiday season, consumers slowed their spending with sales down 0.4 percent compared with December 2006. This was much worse than estimates for a flat reading during the month. Though November’s strength helps offset December’s weakness, there are concerns that December gave us a taste of the pain coming.
Today's session (Wednesday) is already looking awful as I type at 8.00am EST. Futures are already down 14. This is largely due to Intel and it poor earnings which it announced after the market close yesterday. There are now concerns the whole of the the tech market is going to suffer!
Economic data today will consist of the consumer price index, industrial production and the Fed Beige Book. Though weakness has nearly guaranteed a larger rate cut from the Fed, it also has traders extremely worried about how strong a recession we might see.
Until next time.
There wasn’t much news to get excited about Tuesday with retail sales falling and Citigroup (C) reporting disappointing earnings. The only bright spot was that producer prices didn’t rise as much as expected, leaving an emergency rate cut by the Fed a strong possibility.
Economic news was also a major problem for the bulls Tuesday, with weaker than expected retail sales data for December. After what was a rather strong November heading into the holiday season, consumers slowed their spending with sales down 0.4 percent compared with December 2006. This was much worse than estimates for a flat reading during the month. Though November’s strength helps offset December’s weakness, there are concerns that December gave us a taste of the pain coming.
Today's session (Wednesday) is already looking awful as I type at 8.00am EST. Futures are already down 14. This is largely due to Intel and it poor earnings which it announced after the market close yesterday. There are now concerns the whole of the the tech market is going to suffer!
Economic data today will consist of the consumer price index, industrial production and the Fed Beige Book. Though weakness has nearly guaranteed a larger rate cut from the Fed, it also has traders extremely worried about how strong a recession we might see.
Until next time.
# posted by Paul @ 6:03 AM 
