The Week In Review
3/2-3/6/09March 6, 2009
U.S. stocks bounce on the open even though the economic data gets worse. The Labor Department reported 651,000 lost jobs in February while unemployment hit a 25-year high of 8.1%. The Dow Jones Industrial gained 52 points to 6,646. The S&P 500 Index climbed 5 points to 687 while the Nasdaq Composite added 6 points to 1,305. The financials are higher bouncing on the bad news. Wells Fargo did what everyone expected, cutting their dividend to preserve cash. The stock is up 13%, but down 75% since October. Bank of America is higher even though they keep finding more losses at Merrill Lynch. Unbelieveable. H&R Block is higher after reporting a profit. Within the first half an hour, the Dow surged 150 points. The Nasdaq and the techs are higher, but only by 15 points. Marvell Tech easily beat estimates. Apple is lower thanks to a downgrade at JP Morgan. The retailers are higher except for AnnTaylor. AnnTaylor is down 18% on a much wider quarterly loss. Speaking of losing money, a WallStreet Journal article implied that GM is more open to a bankrupcty filing. I think it's inevitable. After the first half an hour, the rally fizzled led by the techs. After the first hour, the rally was completely gone. The techs are moving lower. The financials have given up their gains. Through the morning and into the afternoon, the averages remained weak. AnnTaylor is now down 30%. The financials are making new lows. JP Morgan is down 9% to a new low. US Bancorp is down 6.5% to a new low. American Express is down 5% to a new low. Goldman Sachs is down 8%. Ugly. Entering the last hour, the averages were breaking down to new lows. The Dow dropped over 100 points below 6500. The Nasdaq declined 28 points. In the last hour, the averages actually recovered into the close thanks to some short covering. The Dow Jones Industrial Average finished up 32 points at 6,626. The S&P 500 closed up 80 cents at 683. The Nasdaq Composite pared its losses and ended down 5 points at 1,293. The S&P 500 lost 7% for the week, while the Dow and Nasdaq slid about 6%.
Just an average week.
March 5, 2009
U.S. stocks open lower with investors spooked by worries about the future of General Motors and hopes for the Chinese stimulus fades. The Dow Jones Industrial Average dropped 127 points to 6,748. GM is down 13%. Altria is up 5% on an upgrade. The S&P 500 shed 15 points to 697 while the Nasdaq Composite declined 22 points to 1,331. The financials keep heading lower. JP Morgan is down 4% on a debt downgrade. Bank of America and Wells Fargo's debt are on credit watch negative. US Bancorp is down 7% on a downgrade. Citigroup is inching closer to one dollar. The CFO of GE is out defending GE Capital indicating the financial division will be profitable in the first quarter. GE is actually higher. The retail sector reported dismal February sales. Gymboree is down 31% on earnings. Most retailers are lower except for Walmart which reported a 5% jump in sales. Everyone is going to Walmart. The commodities are lower. The techs are lower. Google and Yahoo are lower on downgrades. Adobe is a bright spot, up 10% on better than expected earnings. The company received three upgrades. After the first half an hour the averages were trying to rebound, but faltered. Barrons put out a positive piece on Aetna and Unitedhealth Group, but it isn't helping. After the first hour the averages were back at the lows of the day. Through the morning and into the afternoon, the averages kept moving lower. The Dow dropped 250 points. The Nasdaq declined 40 points. Citigroup dipped below a dollar a share. The rest of the financials are heading that way. GE held up for most of the day before falling in the red. The Wells Fargo Chairman bought a 100,000 shares, but it didn't seem to help. The insurance stocks are getting clobbered. No bottom in sight. In the last hour, the averages kept moving lower. The Dow Jones Industrial Average fell 281 points, or 4.1%, to end at 6,594. The S&P 500 shed 30 points, or 4.3%, to end at 682, while the Nasdaq Composite slumped 54 points, or 4%, to 1,299.
March 4, 2009
U.S. stocks bounce on the open following five consecutive down days. The Chinese market jumped 6% on a new stimulus plan. The U.S. followed suit with more details of a mortgage modification plan to keep people in their homes. The Dow Jones Industrial Average jumped 101 points to 6,827. The S&P 500 Index rose 11 points to 707, while the Nasdaq Composite climbed 19 points to 1,340. The financials are modestly higher. U.S. Bancorp jumped on the open after cutting their dividend 88%. Blackrock is up 2% on an upgrade. Three deep discount retailers BJs, Big Lots, and Costco all reported this morning. All three are higher. Big Lots is jumping 16%. Joy Global is up 12% on better than expected earnings. The commodities are performing well. The techs look good except for Google which laid out a bearish economic view for 2009. After the first half an hour, the major averages still looked good, but a number of stocks started to succumb to selling, namely GE. The stock is down 10% to new lows. U.S. Bancorp and a number of financials are lower. Insurance stocks are going down as well. Hartford is making new lows. Google is selling off. Here we go again. In the middle of the morning, GE made a statement defending their financial position helping lift that stock and the broader market. During the lunch hour, the averages remained strong, but the off the highs. The financials are all in the red. More insider buying at GE, but it's not helping. That's not good. In the middle of the afternoon, the Beige book was released and it wasn't pretty. The Fed expects the economy to remain weak until at least the end of the year. The bad news didn't hurt the averages. In fact, they actually rallied into the last hour. The Dow jumped as much as 250 points on indications Congress would review the mark to market accounting standards next week. That news signaled the top and the averages sold off into the close.
March 3, 2009
U.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.
March 2, 2009
U.S. stocks opened lower, pushing the Dow Jones Industrial Average under 7,000 for the first time since October 28, 1997, after insurance giant AIG reported a $61.7 billion quarterly loss. The Dow Jones Industrial Average fell 132 points to 6,930. The S&P 500 dropped 15 points to 720, while the Nasdaq Composite shed 18 points to 1,359. Citigroup is unchanged, but the other big banks are moving lower. Bank of America is down 10% on concerns they are the next firm to receive government money. PNC is down 3% after slashing their dividend. Berkshire Hathaway had its worse year ever in 2008. Buffet is not that optimistic about the economy in 2009. Berkshire is down 7%. Outside the financials, things are not as bad, but not good. All the commodities are lower. The healthcare sector resumes their downward drift. Wellpoint was upgraded, but the stock is down 4%. The big techs are holding in there. Dell is up 5% on an upgrade and a positive piece in Barrons. Corning is unchanged after providing encouraging forecast for 2009. After the first half an hour, the averages remain weak, but off the lows. Through the morning, the averages pushed lower. The Dow dropped over 200 points. Nothing looks good. There are no buyers left. In the afternoon, more of the same. The CEO of Bank of America is out defending his company, but it's not helping. The CEO of GE and the Vice Chairman of GE are both buying 50,000 shares. It's not helping either, but my question is, what's a Vice Chairman do? In the last hour, the selling accelerated with the Dow dropped over 300 points. The S&P 500 broke 700 for the first time in 12 years. Both averages are down 55% from the highs. The Dow Jones Industrial Average dropped 299 points, or 4.2%, to 6,763. The S&P 500 shed 34 points, or 2.7%, to 700, while the Nasdaq Composite Index fell 54 points, or 4%, to 1,322.