February 28, 2002And the Grammy for "Best Record of Unintelligible Commentary" goes to Alan Greenspan. In fact, we might as well make that a lifetime achievement award. Yesterday Mr. Fed Head said that the economy is getting better, but never got that bad, and so it won't get a lot better real soon. At least that's what it sounded like he said.
While he was saying it, stocks went way up. After he said it, stocks went way down and by the end of the day, we were pretty much where we started.
Got your taxes done yet? H&R Block beat estimates by a bunch in the fourth quarter, sixteen cents a share versus a nine-cent estimate. Intimate Brands, the Victoria's Secret folks, also beat estimates. Gateway and Shire Pharmaceutical and Tiffany guiding estimates lower this morning.
At 8:30 we'll get the revised fourth quarter Gross Domestic Product number. Expect a 1% increase in GDP. In front of that number it looks like a very slightly positive market at the open. Adjusted for fair value, S&P futures are up 1, the Dow futures are up 13, and the Nasdaq futures are about 5 points above fair value.
February 27, 2002Consumer Confidence took a bigger dip than expected last month, as reported by Conference Board survey yesterday. That confirmed what the University of Michigan survey reported a couple weeks ago. Now, how much of that reflects consumer caution about future spending versus a bad case of Enronitis? Well, later today we'll get a look at what consumers are DOING as opposed to what they are SAYING.
In ten minutes, the January Durable Goods number is expected to dip a bit, and then at 10 o'clock, January New Home Sales will be reported. They are expected to be flat with last month. But if those numbers come in a lot better than expected, the market will probably recover the momentum it lost yesterday.
Mr. Greenspan testifies before the House Financial Services Committee later today. Although the Fed is likely done jiggling interest rates for awhile, a few kind words about the economy there could go a long way.
Japanese stocks were up 3% overnight. Europe is doing well at this hour as well. It looks like we'll get off to a pretty good start this morning. Adjusted for fair value, S&P futures are up a point, the Dow futures are up 20, and the Nasdaq futures are about 10 points above fair value.
February 26, 2002The Dow Jones Industrial Average is back in positive territory for 2002. That's the first time since early January. The General Motors guidance we talked about yesterday, positive guidance from Qualcomm, and a much stronger than expected report on existing home sales propelled us nicely higher.
Of course, now that we've got a two-day winning steak going, Congress has scheduled another Enron hearing. We'll see whether investors get spooked again, or if the national attention span is starting to run out on the Enron inquisition.
Starbucks saying this morning that they will grow revenues 20% this year. They will open 1,200 new stores. So if there isn't a Starbucks in your subdivision yet, let alone your basement, there may be one there soon.
The big number of the day comes out at 10 o'clock this morning. The Consumer Confidence Index is expected to be down slightly to 97, from 97.3 last month. Waste Management beat earnings estimates by 6 cents this morning. Home Depot beat estimates by two cents.
Adjusted for fair value, S&P futures are pretty much flat, the Dow futures are up 15, and the Nasdaq futures are about 5 points above fair value.
February 25, 2002Last week was a good week to watch the stock market from afar. Big swings every day, and no consistency at all from day to day. The Dow Jones Industrial Average moved more than 100 points up OR down, every single trading day last week. We'll see if we can get any follow through this morning from what was a pretty good rally Friday afternoon.
A survey released this morning by Manpower may give some hope for job seekers. In the survey of 16,000 companies, 21% said that they plan to add employees this spring. That's up from 16% last quarter. Only 10% of companies plan to cut more jobs.
General Motors with some bullish words this morning. GM is boosting 1st quarter production by 10% over last year and says that its 1st quarter operating earnings may come in 20% better than expected. Not only that, GM's CFO says that it's reasonable to expect GM to earn 10 bucks a share by the middle of the decade. GM is up about 50 cents in premarket trading.
Our futures have been improving for the past hour and took a nice jump on the General Motors announcement. Adjusted for fair value, S&P futures are up almost 2, the Dow futures are up 12, and the Nasdaq futures are about 7 points above fair value.
February 15, 2002We hung around that 10,000 level on the Dow yesterday. A little above, a little below, the Dow closed at 10,002. But today, as they say, is another story.
More accounting worries this morning. The Nasdaq's best performing stock of last year is down 8 per cent in pre-market trading this morning. Nvidia came out with great earnings yesterday, but also announced an internal review of their accounting practices. It may be no big deal, but in this Enron-inspired environment it's ready-fire-aim for investors....they're going to sell first and investigate later when accounting issues are raised. Some accounting issues also be raised about IBM this morning.
In ten minutes, we'll get the January Producer price index, and later this morning, Industrial production numbers and the U of M Consumer Sentiment Index will roll out.
No clear direction for the markets this morning. Adjusted for fair value, S&P futures are down about a point, the Dow futures are down 18, and the Nasdaq futures are about 2 points below fair value.
February 14, 2002Remember all the speculation back in the mid 1990's about whether the Dow Jones Industrial Average would hit 10,000 by the year 2000? Well, it got there well in advance of the millennium, but has spent the last three years trying to make that level stick. Well, it's déjà vu all over again this morning, as we'll probably punch through the 10,000 level again.
Another nice rally yesterday. That's the third time in four days. And last night, Hewlett-Packard beat estimates by 4 cents per share, as did software maker Intuit, as did oil services company Baker Hughes.
But all is not rosy. We'll have more Congressional hearings to survive today. There will be another Enron hearing, and speaking of funny accounting and disappearing retirement funds, the House Ways and Means Committee will hold a hearing on the Social Security system.
St. Valentine's going to get a big kiss from the market at 9:30. Adjusted for fair value, S&P futures are up more than 5, the Dow futures are up 23, and the Nasdaq futures are about 10 points above fair value.
February 13, 2002We'll get our first economic data of the week in about 8 minutes. The January retail sales report is expected to decline about 2 tenths of a percent, due to a big drop in auto sales. Sales outside of autos are expected to rise about two tenths of a percent. Everybody expects weakness in the car sales number due to the end of a lot of the zero percent financing deals. But the non-auto number could give the market a boost if it comes in stronger than expected.
Ford is trading higher in the pre-market this morning on word that the Government won't be launching an investigation into the safety of the Explorer. After the market closes today, we'll get earnings from Hewlett-Packard. As a component of the Dow Jones Industrials, that report may have a big impact on tomorrow's open.
Japan was up 1 percent overnight. Europe just slightly lower this morning.
The futures are pointing to a slightly higher open today, but that retail sales number at 8:30 could have an impact. So far, adjusted for fair value, S&P futures are up about a point, the Dow futures are up 16, and the Nasdaq futures are about 6 points above fair value.
February 12, 2002The good news is that yesterday was the third best day of the year for stock prices. The bad news is that it was also the third lightest day in terms of shares traded. While it would be nice to think that two good days in a row are a positive sign, it really doesn't mean much on such thin volume.
Shares of Canadian telecom equipment company Nortel Nelworks were halted in after-hours trading last night. Nortel's CFO has resigned after reportedly violating company rules regarding insider trading. Nortel has also confirmed that sales are slower than expected this quarter, although they still say they'll break even by the fourth quarter. In Europe this morning, where the stock is not halted, Nortel is trading down about 8 percent.
No big economic reports due today. So we'll need some help from earnings reports, because we're going to get off to an ugly start. Adjusted for fair value, S&P futures are down 6, the Dow futures are down 55, but the Nasdaq futures are 21 points below fair value.
February 11, 2002The Nasdaq was having its worst week since just after September 11th last week, so we needed a rally on Friday, and we got a pretty good one. Of course, we had no televised Congressional hearings regarding Enron. Connection? You bet. As bad as the Enron story is, Enron is past tense. What corporations and their consultants are doing now - and what Congress decides to do in the future - that's giving the market the heebie-jeebies.
Not that anybody's paying attention, but the economic data from last week was pretty good. Factory orders were up, nonfarm productivity was up, unemployment claims were down. So, the economy may be turning a corner.
Ford Motor shares may be under some pressure this morning after a negative article in Barron's this weekend regarding Ford Motor Credit.
The rest of the world seems pretty inspired by Friday's rally. Japan was up about one percent. European markets are generally up anywhere from one-half to 1 ½ percent. But our futures are not particularly pretty this morning. Adjusted for fair value, S&P futures are down 3, but the Dow futures are down about 30, but the Nasdaq futures are about 7 points below fair value.
February 8, 2002The stock market continued suffering from the Enron flu yesterday. That's the fifth day in a row. But if you believe yesterday's testimony from former Enron CEO Jeff Skilling, it answers an important question for all of us. How do you make millions and millions as a CEO of a major corporation? Evidently, you know nothing about the structure of the company, you don't ask a lot of questions, and you hire really clever consultants to make sure the earnings keep showing up on the financials. So, it looks like it's a lot easier than we all thought. Oh, let's hope this doesn't take as long as the O.J. Simpson trial.
This morning Cigna beat estimates by 11 cents, excluding special charges. Goodyear came up a penny short of estimates. Tyco shares are looking to rise for the third day in a row, after some crushing declines earlier in the month. Tyco up almost a dollar in the pre-market.
The Japanese market is up for the second day in a row. European markets are flat, waiting for us to get our act together. And we may just do that at the start of trading. Adjusted for fair value, S&P futures are up about 2, but the Dow futures are up about 22, but the Nasdaq futures are 12 points above fair value.
February 7, 2002The Cisco Systems earnings were finally made official after the market closed yesterday. The earnings, as expected, were good. They nearly doubled estimated earnings of 5 cents per share. The problem is, the outlook does not look great. In the conference call last night, Cisco said revenue growth next quarter would be zero to low single digits, and they wouldn't even guess what the rest of the year will bring. And while that may be an honest analysis, it's not exactly what the market wants to hear. Cisco stock is took a 7% hit after hours last night, although it's recovered somewhat in the pre-market trading today.
Worldcom missed their estimated earnings this morning by a penny and guided analysts lower for the rest of the year. Hasbro beat estimates by a nickel. Visteon cutting another 1,600 jobs.
No big economic reports today. At 3 o'clock we'll get a report on the December level of Consumer Credit.
The future took a little spike up about 5 minutes ago. Adjusted for fair value S&P futures up 1 ½ , Dow futures are up about 17, but the Nasdaq futures are 2 points below fair value.
February 6, 2002I think what we have to do is eliminate the use of "double A's."
Think about it, in September, the market fell apart because we were afraid of Afgans on Airplanes. Especially on American Airlines. Then later, we went down more because of Anonymous Anthrax. Now, the market's a mess because of Auditors and Accountants --- from where? Arthur Anderson. Are you catchin' my drift here?
The accounting jitters continued yesterday. The value of conglomerate Tyco continued to spiral downward, even as a number of stock analysts supported the company and continued to point out that Tyco's story is very different from the hocus pocus that went on at Enron.
AT&T announcing a new long distance calling plan this morning - unlimited long distance to any other AT&T customer for a flat $19.95 a month. That could change pricing in the long distance business big time-yet again.
Stock futures, which looked a little scary two hours ago, have improved a lot in the last half hour. That's because news has leaked out that Cisco Systems inadvertently leaked earnings information to a bunch of employees last night. That news won't be officially released until tonight, but evidently the news is good. At this point, adjusted for fair value, S&P futures are down 1, Dow futures are down 9, but the Nasdaq futures are 11 points above fair value.
February 5, 2002As more information comes to light about the big mess known as Enron, the more the market is on the lookout for other examples of corporate misbehavior. That's what rocked stocks yesterday that took all the major indexes down between 2 to 3 percent.
Colgate Palmolive met estimates this morning. Sprint came in roughly in line with estimates, but the near term outlook for demand and pricing in the phone business is still weak, at best.
At 10 o'clock this morning, we'll get the report on December factory orders. An increase of 1 percent is expected. Factory orders were down over 3% last month. And later today, Alan Greenspan, Paul O'Neill, Harvey Pitt, Arthur Andersen's CEO ..... just about everybody except Ken Lay will be testifying before Congress.
The Japanese Nikkei index is now at its lowest point in 18 years. European markets are down 1 percent or less this morning. Our futures have been sliding again this morning. Right now we're close to even with fair value on all the major indexes.
February 4, 2002Well, they say as January goes, so goes the year in stocks. In case you hadn't noticed, stocks declined in January. The AFC won the Super Bowl, according to the Super Bowl indicator, that's not good news for the market.
With former Enron's Chairman refusing to talk to Congress, a potential run on the banks in Argentina tomorrow, it's hard to gin up a positive attitude this morning, but we're gonna try.
The ISM Index released Friday was a good one, manufacturing activity is just barely below a level that would indicate expansion. We'll get earnings reports later today from Sprint, Sprint PCS and Borg Warner.
Japan was down overnight, the Nikkei index is now lower than the Dow Jones Industrial average. European markets are down around 1 percent this morning. Our futures have been sliding all morning. Adjusted for fair value, S&P futures are down 5, Dow futures are down 34, and the Nasdaq futures are 13 points below fair value.
February 1, 2002Most of the big-name earnings reports are in the books for the week. Disney surprised last night, earnings 15 cents per share on an operating basis, against an expected ten cents.
There are four big economic reports on the way. The big ones are the unemployment numbers at 8:30 and the ISM Index at 10 o'clock. That ISM number, which is a measure of manufacturing activity, could break 50 for January, which would indicate expansion in manufacturing. It's been a long, long time since we've been there.
Looks like we'll get a proposal from President Bush today to give employees more flexibility in selling company stock in their 401(k) plans. Reportedly it would allow employees to sell any contributed employer stock in their plan that they've held at least three years.
The futures have been slowly rising most of the morning. But that unemployment number at 8:30 could change everything. At this point, futures on all major indexes are slightly positive, but just about even with fair value.