Market Summary

Wall Street took a slight step back Monday after major averages powered forward over 1% last week. Futures were down in the premarket, and with a lack of news, didn’t give traders a reason to start buying. Instead, calm profit taking hit the street. The Dow Jones industrial average fell 32.12, or 0.3 percent, to 9,337.95. The Standard & Poor’s 500 index fell 3.38, or 0.3 percent, to 1,007.10, while the Nasdaq composite index fell 8.01, or 0.4 percent, to 1,992.24. Pullbacks are healthy, especially after the massive rally we have experienced.

Before a record $74 billion debt offering, government debt prices rose following Friday’s steep decline. Yields have been moving higher alongside equities as investors are more open to taking higher risk in the marketplace. The benchmark 10 year U.S. treasury fell 9 basis points to 3.77%.

Freddie Mac Posts Profit, Where Am I?! Says No Mas to Government Aid (For the Time Being)

The mortgage company (FRE), which is under federal conservatorship, posted a second quarter profit of $768 million compared to an $821 million loss recorded in the same quarter last year.
After paying out $1.1 billion in dividends on the preferred stock held by the Treasury Department, Freddie Mac posted a per share loss of 11 cents, much smaller than the $3.14 per share loss recorded in the first quarter of this year.

The company also completed 15,603 loan modifications in the second quarter, more than tripled the amount done last year.

Needless to say, shares surged nearly 80% on Monday.

Retail Sales Look to Post Gain

A jump in new-car sales fueled by the “cash-for-clunkers” trade-in program likely powered U.S. retail sales to a third straight monthly gain in July, according to a Reuters survey of 74 economists.

It would mark the first three-month string of sales rises in more than a year and help underpin optimism that recession is likely to end in the current quarter, as forecast on Monday by a huge majority of Blue Chip private-sector economists.

The Reuters survey estimates that July retail sales, to be published on Thursday, climbed a relatively sturdy 0.7 percent after gains of 0.6 percent in June and 0.5 percent in May.
Car dealers estimate that the Obama administration’s program offering incentives for consumers who trade in gas-guzzling old cars for more efficient new ones had spurred more than 245,000 new-car sales by last Friday by offering some $1 billion of rebates.

Major retailers such as Wal-Mart and Macy’s Inc will report earnings later this week.