Market Summary

Equities advanced in trading on Monday, recouping Friday’s losses ahead of the August FOMC meeting which begins tomorrow. I am not exactly sure what the street expects the Fed to do, besides open a new bout of quantitative easing. Futures got kick started in the premarket on rising global markets and extended those gains into the closing bell. At 4 PM, the Dow Jones Industrial average rose 45.19, or 0.4 percent, to 10,698.75. The Standard & Poor’s 500 index climbed 6.15, or 0.6 percent, to 1,127.79, while the Nasdaq composite index advanced 17.22, or 0.8 percent, to 2,305.69, led by Hewlett-Packard Co (HPQ), which recovered slightly after Friday’s tumble. Trading was pretty much at a standstill, with volume only registering 3.3 billion shares on the NYSE, however market breadth was very positive, with advancers to decliners of 3-1.

Gold was off $2.70 to $1,202.60 an ounce, while September crude rose 78 cents or 1 percent to $81.48 on the NYMEX to end its 3 day decline. The greenback looks to end its nine week decline, bouncing off of four month lows ahead of the Fed meeting.

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While investment strategists generally expect US equities to close out 2010 in negative territory with a likely rebound early next year, most also say the market between now and December 31 remains too unpredictable to forecast with any confidence.

Economic Data

After a series of disappointing reports on jobs, housing and manufacturing earlier this year, for example, third- and fourth-quarter economic data will carry significant weight as Wall Street looks for signs the economy is continuing its expansion despite the financial crisis in Europe.

Political Uncertainty

Historically, the market’s sweet spot during the four-year presidential cycle is the fourth quarter of the midterm year and first quarter of the pre-election year, according to the Stock Trader’s Almanac. That suggests the markets may get a boost between October 2010 and March 2011.

Morning Outlook

World markets advanced overnight despite the U.S. employment situation, led by gains in Europe. European markets climbed after German exports reached their highest levels since late 2008. There are no economic reports out on the session, so what you see is what you get. Futures in the U.S are higher in the premarket following global equities and look to recover the slight losses from Friday’s session. So far in the premarket, Dow Jones industrial average futures climbed 33, or 0.3 percent, to 10,646. Standard & Poor’s 500 index futures rose 4.20, or 0.4 percent, to 1,123.70, while Nasdaq 100 index futures advanced 6.25, or 0.3 percent, to 1,908.75.

Wall Street overcame another disappointing Employment Situation for the month of July, with the blue chips overcoming 100 plus point losses earlier in the session to close only slightly in the red. The Dow Jones industrial average closed down 21.42 points, or 0.2 percent, at 10,653.56. The Standard & Poor’s 500 index fell 4.17, or 0.4 percent, to 1,121.64, while the Nasdaq composite index lost 4.59, or 0.2 percent, to 2,288.47.

On the Corporate Front

Hewlett-Packard Co (HPQ) is the talk of the street to kick off the new week, as it seems from an outsider that the company is running a reality show over in Silicon Valley. 4 years after their last CEO ouster, Hewlett-Packard Chief Executive Mark Hurd resigned Friday following a probe into a sexual-harassment claim against him made by a former contractor.

Tyson Foods Inc. (TSN) reported net income of $248 million or 65 cents per share in the quarter ending July 3, an 89 percent jump from $131 million, or 35 cents per share last year. Revenue climbed 11.6 percent to $7.44 billion. The company beat analyst expectations on the top and bottom line, as the street was looking for earnings of 58 cents per share on revenue of $7.26 billion. That is some good white meat!

Currencies and Commodities

The dollar rose 0.1935% at 85.6760 yen in the currency market. The euro depreciated 0.2071% at $1.3252, while the pound gained 0.1132% to $1.5961. Gold climbed $3.70 to $1209, while silver rose 0.04% at $18.48. Light, sweet crude for September delivery was up 89 cents at $81.59 per barrel on the NYMEX; a 1.10 advance

Market Summary

It was the same old story on Wall Street Tuesday, where futures gave up slight gains in the premarket following a reversal in the euro dollar trade with the euro falling to its lowest level in four years. We had some good housing numbers, but domestic data is in the rear view mirror in investor’s minds as equities are following the strength of the euro.

At the closing bell, the blue chips had another triple digit swing, falling 114.88, or 1.1 percent, to 10,510.95. The Standard & Poor’s 500 index fell 16.14, or 1.4 percent, to 1,120.80, while the Nasdaq composite index led the way to the downside, losing 36.97, or 1.6 percent, to 2,317.26

Benchmark crude for June delivery fell 54 cents to settle at $69.41 a barrel on the NYMEX, erasing earlier gains and closing below $70, a very bearish sign.

Economic Rundown

We saw a boost in housing starts for the second consecutive month leading up to the expiration of the homebuyer tax credit. Housing starts in April advanced 5.8 percent, following a 5.0 percent gain in March. The April annualized pace of 672,000 units topped economists forecast of 650,000 units. The reading was a 40.9 percent year over year increase. April’s gain was led by a 10.2 percent increase in single-family starts, following a 2.1 percent rise in March. The multifamily component fell 18.6 percent after a 24.4 percent surge the month before.

The producer price index declined by 0.1 percent in April from a 0.7 percent spike in March. The April number came in below the consensus forecast for a 0.1 percent rise. Declines in both food and energy helped pull the headline figure down. At the core level (excluding food and energy), the PPI came in with a 0.2 percent increase, following a 0.1 percent uptick in March and above the 0.1 percent the street had expected.

Core PPI rose to 1.0 percent year over year from 0.8 percent the month before.

On the Corporate Front

Hewlett-Packard Company (HPQ) reported after the bell, earning $2.2 billion, or 91 cents per share for the fiscal quarter ending April 30th. HPQ earned $1.7 billion, or 71 cents per share, in the same period last year. The tech giant reported net revenue of $30.8 billion, up 13% from a year earlier

We also saw a raised 2010 outlook, certainly the sector will like that tomorrow…

Morning Outlook

Wall Street is heading higher Thursday morning. Earnings galore have edged futures higher as the street awaits the weekly jobless claim numbers from the Labor Department. The focus today seems to be on the domestic economy, which is constantly showing signs of improvement over this earnings season. Time Warner Cable Inc (TWC) Procter & Gamble Co (PG) Colgate-Palmolive Company (CL) just to name a few have released so far this morning. Dow Jones industrial average futures rose 38, or 0.3 percent, to 11,053. Standard & Poor’s 500 index futures gained 6.30, or 0.5 percent, to 1,196.40, while Nasdaq 100 index futures climbed 9.50, or 0.5 percent, to 2,016.25. Oil is heading its way higher, while the greenback is moving against european currencies. I wonder what country the rating agencies with downgrade today when everyone else with common sense downgraded them months and months ago.

Stocks are coming off of solid gains on Wednesday, buoyed by the Fed’s statement, earnings, and an after the bell deal between HPQ and PALM for $1.2 billion in cash. Yesterday, the blue chips advanced 53.28 points, or 0.5 percent, to 11,045.27. The Standard & Poor’s 500 index rose 7.65, or 0.7 percent, to 1,191.36, while the Nasdaq composite index climbed just 0.26 of a point, or 0.01 percent, to 2,471.73.

Currencies and Commodities

The dollar rose 0.0505% at 94.0750 yen in the currency market. The euro appreciated 0.3044% at $1.3261 while the pound gained 0.3068% to $1.5255. Gold dropped $3.50 at $1168.30, while silver gained 0.25% at $18.18. Light, sweet crude advanced $1.02 to $84.24 per barrel on the NYMEX; a 1.23% move up.

Economic Calendar

8:30 AM
Jobless Claims: New unemployment claims for the week of April 24th, showing the number of individuals who filed for unemployment insurance for the first time. The fewer people filing for unemployment benefits, the more that have jobs, the more income in the consumer’s pocket, as well as a forecast on the strength of the economy. The consensus is for an increase of 447,000 for first time jobless claims, down from last week’s surprising spike of 456,000.

Market Summary

Traders came into the session with a lot of question marks. How would the street react to yesterday’s sharp decline? What would the Fed say? Well investors were pretty calm throughout the session. The market did see a slight pop, extending modest gains following the afternoon Fed Statement. Late to the party as always, S&P downgraded Spain’s long-term debt to “AA” from “AA+”

At the closing bell, the blue chips advanced 53.28 points, or 0.5 percent, to 11,045.27. The Standard & Poor’s 500 index rose 7.65, or 0.7 percent, to 1,191.36, while the Nasdaq composite index climbed just 0.26 of a point, or 0.01 percent, to 2,471.73.

Benchmark crude for June delivery rose 78 cents to settle at $83.22 a barrel on the NYMEX, reversing an earlier decline despite the fact that crude oil inventories increased by nearly 2 million barrels last week.

Economic Rundown

The FOMC concluded its two say policy meeting this afternoon. Nothing new to report on that front, as we saw the same language in regards to interest rates remaining exceptionally low for an extended period. The market was really looking to hear something regarding the Fed’s balance sheet, which has swelled since the financial crisis and included some $1.25 trillion in Mortgage Backed Securities. The overall balance sheet spans $2.5 trillion, and at some point these assets will be sold off to the private market.

The Fed still sees a moderate recovery, with inflation being a non factor despite the massive liquidity that has been pumped in. The central bank does face a dilemma at some point. You don’t want to see a sudden jump in either rates or inflation. The Fed is going to have to react to real signs of recovery: growth in gross domestic product, the broadest measure of economic activity; modest job gains; and positive earnings by corporations.

On the Corporate Front

At the closing bell we got a little M&A action, when Hewlett Packard Company (HPQ) bought PALM for $5.70 a share, or $1.2 billion. That is a 23 percent premium on PALM common stock. PALM rumors have been circulating for what seems like forever, as the smart phone maker hasn’t really been able to compete with the big boys in the market.

Market Summary

Signs of optimism in the housing market and economy prompted investors to move funds away from bonds as stock markets rallied worldwide today. Following up on yesterday’s strong advance, the blue chips gained 40.43, or 0.4 percent, to 10,309.24. The Standard & Poor’s 500 index rose 4.64, or 0.4 percent, to 1,099.51, while the Nasdaq composite index climbed 12.10, or 0.6 percent, to 2,226.29.

The Fed released the minutes from the January Fed meeting, where despite persistently high unemployment over the next two years, they have raised their assessment of the economy.

On the Corporate Front

Hewlett-Packard Company (HPQ) reported after the bell that net income was $2.3 billion, or 96 cents per share last quarter. Those figures are up from the $1.9 billion, or 75 cents per share the company earned the same period a year prior. Revenue jumped 8 percent to $31.2 billion on the top line, beating analyst estimates of $30 billion.

For 2010, HPQ is forecasting revenue of $121.5 billion to $122.5 billion, above street estimates of $120 billion.

Housing Climbing Out of Hole..Slowly

According to the Commerce Department, groundbreaking activity for new homes increased 2.8 percent to a seasonally adjusted annual rate of 591,000 units, north of the 580,000 unit annual pace. December’s housing starts were revised upwards to 575,000 units from the previously reported 557,000. Compared to January last year, starts increased 21.1 percent

To get a gauge of where we are in this recovery compared to past activity, housing starts peaked at a 2.273 million unit annual pace in January 2006 and bottomed at 479,000 units last April. It is staggering how far we have to go.

Debt Up to Our Eyeballs

The Treasury Department said Wednesday that the deficit for January totaled $42.63 billion, down from a $63.46 billion deficit in January 2009 and was below the $47 billion forecast of private economists. That left the total of red ink so far this budget year at $430.69 billion, 8.8 percent higher than last year when the deficit soared to an unprecedented level of $1.42 trillion.

Our deficit in 2010 will be north of 10 percent of GDP, that’s huge! The president’s commission established to come up with legislative recommendations has the goal in mind of reducing our annual deficit to roughly 3.3 percent of GDP.

Major averages soared well over 1 percent following the long holiday weekend as a sagging greenback sent raw materials higher. It was the best day on the street since November as the Dow Jones Industrial average closed up 170 points, or 1.7%, to 10,269. The Standard & Poor’s 500 Index added 19 points, or 1.8%, to 1,095, and the Nasdaq Composite Index rose 31 points, or 1.4%, to 2,214.

Morning Outlook

Futures look to the upside Wednesday morning, following yesterday’s strong gains. The greenback is advancing, while crude is still making its way higher to test its upward resistance. Dow Jones industrial average futures rose 21, or 0.2 percent, to 10,262. Standard & Poor’s 500 index futures rose 3.30, or 0.3 percent, to 1,096.50, while Nasdaq 100 index futures rose 5.00, or 0.3 percent, to 1,804.25.

Fifteen companies from the benchmark S&P index are scheduled to report earnings today, including Deere & Co. (DE) and Hewlett-Packard Co (HPQ)

Currencies and Commodities

The dollar rose 0.6484% at 90.724 yen in the currency market. The euro depreciated 0.2429% to $1.3736 while the pound lost 0.1021% to $1.5776. Gold rose 60 cents to $1120.40 an ounce, while silver ticked up 0.45% at $16.22. Light, sweet crude for March delivery continued up from yesterday’s 4% increase, rising 52 cents to $77.53 per barrel on the NYMEX; a 0.68% gain

Economic Calendar

8:30 AM
Housing Starts: Measures initial construction of residential units for the month of January. Housing construction impacts so many other segments of the economy, from consumer spending on appliances and material to labor. The consensus figure is 580,000 units, after falling 4 percent to 557,000 in December.

9:15 AM
Industrial Production: The index of industrial production measures the physical output of the nation’s factories, mines and utilities. The consensus is for a production increase of 0.8% for the month of January for its 7th consecutive monthly advance; up from the 0.6% gain in December. The manufacturing component fell 0.1% last month, so we will have to see if that trend continues.

Wall Street saw a mixed session Friday, with the blue chips advancing for the first time following four consecutive weekly declines. The Dow Jones industrial average lost 45.05 points, or 0.44 percent, to close at 10,099.14. The Standard & Poor’s 500 Index declined 2.96 points, or 0.27 percent, to close at 1,075.51. However, the Nasdaq Composite Index saw positive territory on the day, closing up 6.12 points, or 0.28 percent, at 2,183.53.

Morning Outlook

Stocks look to continue their rise following the first up week in 5 weeks. Financials look to pull the market higher after Barclays, the U.K.’s second- largest bank, beat analysts’ earnings forecasts. Dow Jones industrial average futures rose 34, or 0.3 percent, to 10,151. Standard & Poor’s 500 index futures advanced 4.70, or 0.4 percent, to 1,083.80, while Nasdaq 100 index futures gained 10.00, or 0.6 percent, to 1,793.25.

A drop in the greenback is sending raw materials higher, also helping the major averages and equity markets. This is the kickoff to a busy holiday shortened week following the President’s Day holiday. Outside of scheduled economic data, forty five companies will release quarterly results, including Hewlett- Packard Co. (HPQ) and Wal-Mart Stores Inc. (WMT) today.

Currencies and Commodities

The dollar fell 0.1128% at 89.916 yen in the currency market. The euro appreciated 0.3273% to $1.3643 while the pound gained 0.0948% to $1.5675. Gold surged $22.70 to $1112.70 an ounce, while silver climbed 1.99% at $15.76 Light, sweet crude for March delivery rose $1.06 to $75.19 per barrel on the NYMEX; a 1.43% advance

Economic Calendar

1:00 PM
Housing Market Index: Based on a survey in which respondents from The National Association of Home Builders. Thoughts and feeling over the general economy and housing market conditions weigh into an index that rates the different factors of the housing market.

Time to look back on the year that was 2009, and the end of the first decade of the 21st century. For Wall Street, is was a decade most would like to forget. One thing we have definately learned is that despite the way 2010 starts, it is not a precurser to how it will end.

The benchmark Standard & Poor’s 500 is down about 10 percent over the last 10 years, which puts Wall Street on course to register its first-ever negative decade on a total return basis, even with dividends reinvested.

Even the Great Depression in the 1930s, which followed the stock market crash in October 1929 and spanned one of the worst periods for stock investing, turned out positive as dividends helped investors cushion some of the turbulence.

Below is a list of the 5 top performers and laggards for the blue chips.
LOSERS:

- General Electric (GE) -54.18 pct

- Merck & Co (MRK) -46.49 pct

- DuPont (DD) -39.94 pct

- Alcoa Inc (AA) -21.78 pct

- Coca-Cola Co (KO) -14.89 pct

WINNERS:

- United Technologies Corp (UTX) 155.49 pct

- Caterpillar Inc (CAT) 148.65 pct

- 3M Co (MMM) 127.68 pct

- Hewlett-Packard Co. (HPQ) 92.70 pct

- Exxon Mobil Corp (XOM) 86.56 pct

Where do we go from here? You have some swearing that this is a V shaped recovery, while others point out that the economic fundamentals don’t support that. The facts are that you have a ton of government monetary and fiscal stimulus in the system right now. The November unemployment rate stands at 10%.

The S&P 500 is up 66.5 percent from a 12-year closing low set on March 9. Its trading levels now imply a forward price/earnings ratio of 15.5. Such a huge run up begs the question where will the correction come. for 2009, the S&P 500 is up 24.7 percent — a gain that puts the broad market index on track for what could be its best year since 2003. An even stronger advance this week could put the S&P 500 in position for its best year since 1998. For 2009, the Dow is up 19.9 percent and the Nasdaq is up 45 percent.

Trading to start the year will be determined based whether or not the economy can grow without government support. I don’t know if it can. There are serious underlying problems in this economy, with the lack of serious consumer spending being number one. You have seen a generational shift, as people are saving more and spending less.

And then you have the X factor…Terrorism. All bets are off when it comes to economic direction when you throw that wild card in. In the best of economic times and can cause panic, as we stand now it could be a near fatal blow to the American way of life. This near Christmas tragedy is a reminder of all the nuts out there.

Market Summary

Wall Street saw ended lower on Tuesday, as stocks fluctuated in trading following a host of economic data and comments from the central bank. The fed upped their 2010 growth prospects for the U.S., while downwardly revising their unemployment predictions for Q4 of 2010.

In a very light volume session, HPQ led the blue chips lower, as the Dow Jones industrial average dropped 17.24 points, or 0.16 percent, to end at 10,433.71. The Standard & Poor’s 500 Index lost 0.59 of a point, or 0.05 percent, to 1,105.65, while the Nasdaq Composite Index fell 6.83 points, or 0.31 percent, to 2,169.18.

The dollar rose slightly, while benchmark crude for December delivery fell $1.54 to settle at $76.02 a barrel on the NYMEX. The EIA will release their inventory report tomorrow.

New Fed Forecasts

The fed forecasts that the unemployment rate will be in the 9.3 to 9.7 percent range at the end of 2010, compared with a 9.5 to 9.8 percent range in their previous forecasts from June. They expect GDP to grow 2.5 to 3.5 percent next year, compared with a 2.1 to 3.3 percent projection in June.

In addition, the unemployment rate will be in the 6.8 to 7.5 percent range at the end of 2012, according to forecasts of 17 top Fed officials. The unemployment rate currently stands at 10.2%. Tons of slackkkk

Tons of Economic Data…No Clear Direction

The street was hit with a barrage of economic reports during the session, and its clear that nothing is definitive in terms of the economic strength and direction.

The U.S. Commerce Department’s second estimate of third quarter economic output, published on Tuesday, showed growth at a 2.8 percent annual rate, rather than the 3.5 percent pace it estimated last month.

It was still the fastest pace since the third quarter of 2007

The Standard & Poor’s/Case-Shiller index of home prices in 20 metropolitan areas rose 0.3 percent in September. It was the fifth straight monthly increase in home prices. Year over year however, home prices fell 9.4%.

Consumer confidence also edged up in November following October’s decline. The index increased to 49.5 in November from 48.7 in October. Economists had been expecting a slight decline.