Day Traders Diary
2/3/09U.S. stocks on Tuesday scaled back early gains as Federal Reserve Chairman Ben Bernanke had little positive to say on the economy. The Dow Jones Industrial Average gained 39 points to 6,803. The S&P 500 inched up 6 points to 707, while the Nasdaq Composite added 12 points to 1,335. The economic news goes from bad to worse every day. Goldman Sachs is predicting a 7% decline in GDP in the first quarter and no recovery in the second half. Most of the financials are unchanged or modestly higher this morning. Citigroup is initiating an assistance program for distressed homeowners. The Obama administration is relooking at the bad bank plan in reaction to the sharp drop in the banking stocks. After the first hour, the averages remained in the green, but not by much. The earnings keep coming in. Chicos, Trina Solar, and MBIA all reported quarterly losses. Autozone is up 10% on positive earnings. Go figure. As the morning progressed, the averages gravitated toward the unchanged level, then fell into the red. MGM Mirage is down 20% as a Chapter 11 becomes more realistic. Not a lot of good news out there. During the lunch hour, the averages moved back into the green and remained in the green entering the last hour. But no rally is safe. In the last hour, the averages dropped again thanks to the financials. Bank of America gave up it's gains on a debt downgrade. GE remains weak as their credit swaps keep pushing higher. The Dow Jones Industrial Average finished down 37 points at 6,726. The S&P 500 shed 4 points to 696, while the Nasdaq Composite declined a point to 1,321.
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