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
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
US House Prices Trend Forecast 2024 to 2026 - 11th Oct 24
US Housing Market Analysis - Immigration Drives House Prices Higher - 30th Sep 24
Stock Market October Correction - 30th Sep 24
The Folly of Tariffs and Trade Wars - 30th Sep 24
Gold: 5 principles to help you stay ahead of price turns - 30th Sep 24
The Everything Rally will Spark multi year Bull Market - 30th Sep 24
US FIXED MORTGAGES LIMITING SUPPLY - 23rd Sep 24
US Housing Market Free Equity - 23rd Sep 24
US Rate Cut FOMO In Stock Market Correction Window - 22nd Sep 24
US State Demographics - 22nd Sep 24
Gold and Silver Shine as the Fed Cuts Rates: What’s Next? - 22nd Sep 24
Stock Market Sentiment Speaks:Nothing Can Topple This Market - 22nd Sep 24
US Population Growth Rate - 17th Sep 24
Are Stocks Overheating? - 17th Sep 24
Sentiment Speaks: Silver Is At A Major Turning Point - 17th Sep 24
If The Stock Market Turn Quickly, How Bad Can Things Get? - 17th Sep 24
IMMIGRATION DRIVES HOUSE PRICES HIGHER - 12th Sep 24
Global Debt Bubble - 12th Sep 24
Gold’s Outlook CPI Data - 12th Sep 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Stock Markets Retreat Ahead Of U.S. Corporate Earnings Season

Stock-Markets / Financial Markets 2009 Jan 12, 2009 - 11:28 AM GMT

By: PaddyPowerTrader

Stock-Markets Best Financial Markets Analysis ArticleFriday saw a late in the day sell-off of over 200 points in the Dow Jones. This was a reality check for those who tried (in vain) to trade the nonfarm jobs number as not quite as bad as feared . Standing back, while the headline number was not the kitchen sink number some had predicted, the downward revisions to previous months and the uptick in the unemployment rate meant the report was about as bad as it could have been. The major worry for equities remains earnings revisions and daily analyst downgrades which are sapping sentiment and sucking the life out of the appetite for risk.


Today's Market Moving Stores

  • The UK government is mulling over giving guarantees for banks main sources of funding MBS (mortgage backed securities) and/or small business loans. Meanwhile the German government is expected to adopt a two year €50bn fiscal package today. The plan would include a “Germany fund” that would issue credit guarantees to help cash starved businesses raise debt financing.
  • In the UK the NIESR believe that the economy contracted by 1.5% in the final quarter of 2008.
  • The big news from the banking sector is a story that Citibank and Morgan Stanley are in talks to merge their brokerage units. The deal would be structured as a joint venture, but would involve a payment from Morgan Stanley to Citi that would give it the larger stake. Morgan's 8,000 brokers and Citi's 11,000 would create the largest single brokerage in the US, beating Bank of America's Merrill unit which has 16,000 Brokers. Morgan Stanley would have the right over a period of years to increase its stake and ultimately buy all of it.
  • In other banking news we learn that the UK taxpayer in now the proud owner of 43.4% of the combined Lloyds / HBoS group after investors snubbed the rights offerings by both companies. The government has been forced to buy 99% of the stock offered at a cost of £13bn.
  • Asian exports are collapsing. The latest trade data from Asia are horrifying. There seems to be a collapse in global trade under way. Brad Setser has a good analysis with plenty of charts showing the collapse in trade in Korea and Taiwan , where exports are down 40% year on year. While the always readable Doug McIntyre highlights the plight of China . Remember when they were going to take over the world?
  • The WSJ says that US retailers are expected to begin a wave of post-Xmas bankruptcy filings.
  • Seems that criticism of the TARP and how tax payers dollar are being spent is on the rise.
  • As the Bank of England cuts rates to record lows, here's a nice visual charting the history of their interest rates .

Comment On Ireland's Rating Outlook Cut

Here's a snippet of what RBS had to say about Ireland being moved to negative outlook by S&P last Friday:

“The main point of concern lies in the economic policy challenges the government faces posed by deterioration in key sectors such as housing, construction and financials – housing related taxes have halved in 2008, from 3.8% to around 1.9% of GDP and tales of corporate defaults (Waterford Wedgewood) and exodus (Dell) will only place further strain on government revenue generation going forward. General government debt levels have increased materially the last few years and in particular after guaranteeing bank debt (has taken general govt debt levels to a putative 228% of GDP, although this is of course contingent only). The impact on the banks should hardly be felt, as the market has been pricing Ireland in the same vein as Thailand in recent weeks i.e. a long way off AAA status in any event. It also will not prevent the govt from being able to provide the €10bn allocated to bank prefs as this is coming from the National Pension Fund.”

Equities

  • European equity news will be dominated by reports from food giants Tesco and Carrefour.
  • The unofficial start of the US earnings season kicks off today with earnings from Alcoa after the close of trading. Recall they rattled the market last week with news of 13.5k pending job cuts and plans to cut capital spending by 50%.
  • Another blue chip bellwether stock reporting this week is Intel on Thursday. These numbers will be closely watched as they are often seen as a wider barometer for the health of the tech sector as a whole.

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