Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
US Presidential Election Year Stock Market Seasonal Trend - 29th Nov 24
Who controls the past controls the future: who controls the present controls the past - 29th Nov 24
Gold After Trump Wins - 29th Nov 24
The AI Stocks, Housing, Inflation and Bitcoin Crypto Mega-trends - 27th Nov 24
Gold Price Ahead of the Thanksgiving Weekend - 27th Nov 24
Bitcoin Gravy Train Trend Forecast to June 2025 - 24th Nov 24
Stocks, Bitcoin and Crypto Markets Breaking Bad on Donald Trump Pump - 21st Nov 24
Gold Price To Re-Test $2,700 - 21st Nov 24
Stock Market Sentiment Speaks: This Is My Strong Warning To You - 21st Nov 24
Financial Crisis 2025 - This is Going to Shock People! - 21st Nov 24
Dubai Deluge - AI Tech Stocks Earnings Correction Opportunities - 18th Nov 24
Why President Trump Has NO Real Power - Deep State Military Industrial Complex - 8th Nov 24
Social Grant Increases and Serge Belamant Amid South Africa's New Political Landscape - 8th Nov 24
Is Forex Worth It? - 8th Nov 24
Nvidia Numero Uno in Count Down to President Donald Pump Election Victory - 5th Nov 24
Trump or Harris - Who Wins US Presidential Election 2024 Forecast Prediction - 5th Nov 24
Stock Market Brief in Count Down to US Election Result 2024 - 3rd Nov 24
Gold Stocks’ Winter Rally 2024 - 3rd Nov 24
Why Countdown to U.S. Recession is Underway - 3rd Nov 24
Stock Market Trend Forecast to Jan 2025 - 2nd Nov 24
President Donald PUMP Forecast to Win US Presidential Election 2024 - 1st Nov 24
At These Levels, Buying Silver Is Like Getting It At $5 In 2003 - 28th Oct 24
Nvidia Numero Uno Selling Shovels in the AI Gold Rush - 28th Oct 24
The Future of Online Casinos - 28th Oct 24
Panic in the Air As Stock Market Correction Delivers Deep Opps in AI Tech Stocks - 27th Oct 24
Stocks, Bitcoin, Crypto's Counting Down to President Donald Pump! - 27th Oct 24
UK Budget 2024 - What to do Before 30th Oct - Pensions and ISA's - 27th Oct 24
7 Days of Crypto Opportunities Starts NOW - 27th Oct 24
The Power Law in Venture Capital: How Visionary Investors Like Yuri Milner Have Shaped the Future - 27th Oct 24
This Points To Significantly Higher Silver Prices - 27th Oct 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Fed Helps the Stock Market Rally

Stock-Markets / Financial Markets 2009 Aug 13, 2009 - 05:14 AM GMT

By: PaddyPowerTrader

Stock-Markets

Best Financial Markets Analysis ArticleThe Dow Jones surged yet another 120 points yesterday on the back of existing home sales which rose more than expected (due to lower prices). They stayed perky after the Fed assured us that the US economy was levelling out and that they weren’t taking away that summer punch bowl during 2009 as there is no sign of inflationary pressures.


Risky assets were already trading positively going into FOMC, brushing off the dour sentiment seen in Asia as the market mulled the signs of slower growth in China. The overriding mood of optimism was illustrated by Bloomberg’s latest survey of investor confidence, which produced a 19 point rise in the headline index to 58.1, the first reading above 50 since the survey began about two years earlier. Confidence in the US rose 18 points to 47.3, that in Europe rose 10 points to 41.1 whilst that in Asia jumped 15 points to 74.2, with Japan up 16 points to 50.0.

Whilst equity markets closed off their highs for the session, the S&P500 still managed a broad-based gain of 1.2%, with the price action reinforced by some more upbeat commentary in the insurance sector and better-than-expected earnings at luxury home builder Toll Brothers. The latter noted that its cancellation rate over the past quarter had declined to the lowest level since the housing meltdown began in 2006, helping the S&P homebuilders supercomposite close at a new high.

Today’s Market Moving News

  • Though Asian stocks gained across the board this morning, they are still largely unchanged so far in August and investors were still uncertain what would support equities beyond bullish sentiment. The MSCI index of Asia Pacific shares traded outside Japan rose 1.7%, with the biggest gains spread out across sectors, including financials, technology and consumer discretionary shares. The index has been choppy in recent weeks but is up 72% since March 9, when a global equity rally began. Japan’s Nikkei share average edged up 0.6%, driven by a variety of big auto exporters and tech names.
  • Commodity bulls have pushed oil prices further above $70 a barrel and lifted copper prices to a 10-month high, hoping for sustained demand for raw materials.
  • BHP Billiton, the world’s largest mining company, published its Full Year 2009 results and included an outlook on the commodity markets. BHP believes “commodity re-stocking in China now appears largely complete with substantial build of specific commodities at the end-user level and in strategic stockpiles”. BHP also warned that “further improvements in commodity prices in the short term should be viewed in the context of the likely supply responses from latent capacity across the industry”. However, in the long term BHP continues to expect strong growth in demand for commodities.
  • This European morning, mining stocks are looking bid. Rio Tinto shares are up 3% after it said that its Cloud Peak unit has filed an IPO statement in the US while Anglo American has climbed 2% after it concluded the sale of shares in Tongaat Hulett. The big loser this morning is insurer Aegon after announcing that it needs to raise 1bn in fresh capital through a rights issue (its off 9%).
  • A majority of economists polled by the WSJ say the recession is over, and 71% of those same economists think Ben Bernanke will get to keep his job for another term.
  • Note to Jim (the bottom of the housing market was in June) Cramer – foreclosure activity up 7% in July.
  • Harry Markopolos, the whistleblower on Bernie Madoff, believes that there are evildoers out there who will make the Ponzi scum “look like small-time.”

The Jobless Recovery
Now it may be a lagging indicator but this chart of the average duration of unemployment in weeks is downright frightening. So maybe bit your lip before uttering those “I quit” words.


Irish Equity Snippets
Greencore has issued an Interim Management Statement. In it, there is evidence of positive progress in UK convenience foods and further revenue advances in the US. These trends, together with the benefits of efficiency programmes and some margin accretion, are underlining FY adjusted EPS forecasts of 16.4c, in line with market expectations. Greencore has had a tremendous run in the past week with its share price up 23%. Despite that, its dividend yield is over 5% and these comments should be supportive.

United Drug has announced a joint venture with Medco Solutions to provide home-based pharmacy care in the UK for patients covered by the NHS. This is a green-field investment with a significant global healthcare player, in a space in which United Drug has demonstrated an interest in the past. It has a number of pilot schemes in homecare running in the UK at the moment. The Medco deal is a 50/50 JV with a reasonably modest outlay: start-up costs are believed to be in the region of £4-5mln, with the investment beginning at the end of this financial year (end-September).

Data Ahead Today
At 10:00 Euro area GDP for Q2 will be released. The German and French economies unexpectedly grew in the second quarter, bringing an end to their worst recessions since World War II. Both economies grew by 0.3% despite economists predicting contractions of 0.3% in Germany and a 0.2% in France. EUR/USD climbed half a cent to $1.4262. These early big two numbers have blown away the consensus for a -0.4% contraction for the pan-European number.

US Retail Sales for July will be released at 13:30. Look for a sharp rebound in retail sales, due almost entirely to the “cash for clunkers” program with total retail sales rising +0.8%. But, excluding both autos and gas, I’d expect that retail sales in July were flat.

Earnings from Wal-Mart (at around 13.15), Kohl’s and Nordstrom

And Finally… More From Jim The Realtor

Disclosures = None

By The Mole
PaddyPowerTrader.com

The Mole is a man in the know. I don’t trade for a living, but instead work for a well-known Irish institution, heading a desk that regularly trades over €100 million a day. I aim to provide top quality, up-to-date and relevant market news and data, so that traders can make more informed decisions”.© 2009 Copyright PaddyPowerTrader - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

PaddyPowerTrader Archive

© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in