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Jeff Bailey : 5/31/2005 10:24:15 PM

Program Trading Levels for Wednesday .... HL Camp & Company has their computers set for program buying at $+1.90 and set for program selling at $-0.54.

Jeff Bailey : 5/31/2005 10:00:14 PM

Merger ... School Specialty Inc. (SCHS) $39.22 -0.02% ... announcing it has agreed to be acquired by Bain Cap for $1.5 billion. The deal values SCHS at $49.00 per share.

OI Technical Staff : 5/31/2005 9:59:59 PM

The Market Monitor has been archived. You may view it and any previous days here: Link

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Jeff Bailey : 5/31/2005 9:57:39 PM

Boeing (BA) $63.90 +1.39% ... Ethiopian Airlines saying it will buy 10 new Boeing 787 jets, doubling the number of firm orders it announced earlier this year. Boeing said the deal is worth about $1.6 billion at list price. Boeing said it currently has 266 orders and commitments from 21 customers for its 787 Dreamliners.

Jeff Bailey : 5/31/2005 9:50:52 PM

Global ... Austrailian Q1 GDP +1.9% year-over-year, +0.7% from Q4. Consensus was for +2.2% y/y. Q4 GDP revised up to +0.3% from +0.1%. Australia All Ordinary ($AORD) down a fraction at 4,070.00. Link

Jeff Bailey : 5/31/2005 8:18:31 PM

Sprint (FON) $23.69 +1.84% ... burst in volume late this afternoon (10.8 mill. in last 90-minutes) had stock finishing #8 most active with just over 29 million shares traded. No news that I can find at this point. Average daily volume has been running 10.3 million shares per day. Might be speculative buyers with Qwest (Q) $3.92 +3.15% reportedly still on the prowl.

Jeff Bailey : 5/31/2005 7:28:42 PM

Pivot Matrix for tomorrow at this Link ... DAILY Pivot Levels for the DX00Y should be accurate.

Jeff Bailey : 5/31/2005 5:38:59 PM

September Crude (cl05u) settled up $0.37, or +0.70% at $53.03 on Tuesday. In my book, this may weight on broader equity gains unless we find a settlement back below the $52.73 level. Energy inventory data will be released on Thursday (usually Wednesday mornings) due to Memorial Day holiday.

Jeff Bailey : 5/31/2005 5:31:15 PM

Closing U.S. Market Watch found at this Link ... July Crude Oil (cl05n) settled up $0.12, or +0.23% at $51.97 on Tuesday.

Jeff Bailey : 5/31/2005 5:18:15 PM

Closing Internals found at this Link ... For the month of May, big board volume averaged 1.87 billion shares per day, down 9% from April's 2.06 billion share per day average. NASDAQ volume for the month of May fell for the fourth-straight month, down 8% to 1.66 billion share per day, from April's 1.81 billion daily average.

Jeff Bailey : 5/31/2005 4:22:34 PM

Current OPEN MM Profiles found at this Link ... Today's Activity ... Swing trade bullish stopped in shares of Wells Fargo (WFC) at $60.60. ($-0.35, or -0.57%) Day trade shorted the QQQQ at $38.17, closed at target of $37.93. ($+0.24, or +0.63%).

Jeff Bailey : 5/31/2005 4:15:30 PM

Buy Program Premium ... DIA $104.69, SPY $119.49

Linda Piazza : 5/31/2005 3:59:54 PM

The OEX still looks vulnerable to the 562.66 level, but it looks as if it's going to end the day right at the 565.27 daily Keltner level, potential support. Looks as if it will violate it on the close, but only by a little.

Linda Piazza : 5/31/2005 3:53:08 PM

The RUT looks as if it's forming a doji at the top of a climb, right underneath the resistance at the top of the declining regression channel in which it's traded off the high from late last year. RUT bulls don't want to see a decline tomorrow.

Jeff Bailey : 5/31/2005 3:52:15 PM

Occidental Petroleum (OXY) $73.14 -0.51% Link ... says it may sell its 10.13% stake in Premcor Inc. (PCO) $67.93 -0.62% Link

Linda Piazza : 5/31/2005 3:49:10 PM

Potential downside target now of 562.71 on the OEX. However, if you entered a bearish position today and intended it to be short-term position, you might consider taking partial profit and resetting your stop on the rest. Potential support at the 100-sma and 50% retracement of the March-April decline nears, at 564.70 and 564.81, respectively.

Jonathan Levinson : 5/31/2005 3:42:44 PM

QQQQ is holding on the 72 SMA support, just ticking below it as I type. The 30 min cycle trying to hold an upphase and the 60 min cycle trying for a downphase. The short cycle indicators have rolled over, complete with bearish divergence. Below the 72 SMA, the current lows from 37.92-38.00 are first support, but the failure of the 30 min cycle to make or match the previous high is bearish amd spells trouble for the seriously overbought daily cycle. A lower high and lower low today are not what the longer term bulls want to see.

Jeff Bailey : 5/31/2005 3:42:43 PM

El Paso Corp. (EP) $10.32 +1.17% Link ... upgraded to "buy" from "neutral" at UBS after company said it sold its Lakeside Technology Center in Chicago to Digital Realty Trust (DLR) $15.03 -0.66% for $140 million in cash.

Linda Piazza : 5/31/2005 3:39:00 PM

The BIX is turning down, too, testing its 200-sma as it's been doing a lot of the day. The component stocks that the OEX shares with the RLX has been helping to support the OEX today, though, as the RLX has been zooming high since mid-morning. The RLX has seen a strong decline during the last 15 minutes, but there's a possible inverse H&S on that chart, too, with the RLX haven fallen toward the right-shoulder area.

Jeff Bailey : 5/31/2005 3:38:23 PM

Boston Scientific (BSX) $27.18 -2.75% Link ... Recalling an additional 1,000 implantable devices that are used to give medications and other fluids to patients after FDA cited "serious regulatory problems" involving mfg. process.

Linda Piazza : 5/31/2005 3:34:05 PM

Remember the possible inverse H&S on the OEX's 15-minute chart. This pullback could be part of a right-shoulder forming process. That's not how it looks on the 15-minute Keltner chart (looks weaker than that), but since those charts are settling into an equilibrium position, their evidence might not be completely trustworthy.

Jonathan Levinson : 5/31/2005 3:31:44 PM

Steep/impulsive drop here back to 7200 tick SMA support for QQQQ: Link

Jeff Bailey : 5/31/2005 3:31:33 PM

Sell Program Premium .... SPX 1,194.59, DIA $104.93, QQQQ $38.15

Linda Piazza : 5/31/2005 3:29:32 PM

SOX headed down, but still coiling within the triangle shape that it's been forming since Thursday morning.

Linda Piazza : 5/31/2005 3:26:24 PM

Still upper shadows on the OEX's 15-minute candles, including the current one so far. Still finding support on the Keltner line currently at 566.89.

Jeff Bailey : 5/31/2005 3:21:14 PM

Dow Transports (TRAN) 3,618.46 -0.12% ... back at WEEKLY Pivot after early test of WEEKLY S1. Weekly Pivot Levels ... 3,550, 3,587, Piv= 3,618, 3,654, 3,686.

Jonathan Levinson : 5/31/2005 3:19:15 PM

Closeup of today's intraday QQQQ at this Link , peeking above the daily pivot and confluence resistance at 38.20 as I type. The 30 min channel top is up to 38.26, and it appears for the moment that the 30 min upphase has a good shot at overcoming the stalling 60 min downphase early in its run. It will take a break of 38/27-.30 resistance to confirm it, however, and volume remains weak, 62.1M QQQQs traded so far. I was hoping that the 1-week+ volume strike would end today, but no such luck.

Linda Piazza : 5/31/2005 3:14:40 PM

Lots of upper shadows on the OEX's 15-minute candles, a sign of some hesitation or waning strength, but the OEX now maintains support on a Keltner line currently at 566.77 since about 1:30.

Jeff Bailey : 5/31/2005 3:10:21 PM

03:00 Internals at this Link

Jeff Bailey : 5/31/2005 3:03:26 PM

03:00 Market Watch found at this Link

Jonathan Levinson : 5/31/2005 2:53:34 PM

Breadth has improved but remains negative, declining volume leading 1.1:1 on the NYSE and 1.15:1 on the Nasdaq. The TRIN remains high at 1.36, ditto the TRINQ at 1.26, but overall volume is still light. My feeling is that this is a distribution day, and the morning drop was much steeper and more convincing than the current bounce that followed- but price remains comfortably within last week's range.

Jeff Bailey : 5/31/2005 2:50:44 PM

Ron Insana (CNBC) .... I think we've already seen some outflow of capital from EU Ron. (Note dollar strength, US asset class rallies).

Linda Piazza : 5/31/2005 2:48:36 PM

Caught on the telephone.

Linda Piazza : 5/31/2005 2:42:03 PM

This time, the OEX is getting slapped back a little. Not that much, but bulls aren't seeing any more follow-through than the bears did. Oh, well, it's good for my credit spreads . . .

Jonathan Levinson : 5/31/2005 2:39:29 PM

TNX is punching through 4% now, printing 3.96%. Current 20-day bollinger support is at 3.998%, and the February low is at 3.97%. Steven Roach has joined the bullish chorus- I heard that he sees ten year rates going as low as 3.5%. Daily chart at this Link

Linda Piazza : 5/31/2005 2:36:10 PM

And the OEX drives higher. I don't know whether to consider that a valid inverse H&S, as the right shoulder isn't as pronounced as the left shoulder had been, but prices just moved across the neckline. Bulls need to see this hold, as the OEX faces Keltner resistance now. The OEX is still just chopping around.

Jonathan Levinson : 5/31/2005 2:30:48 PM

Session high for July crude at the close, +.125 at 51.975.

Jonathan Levinson : 5/31/2005 2:30:25 PM

Ten year yields are back to 4.0%, -7.3 bps here in a 1.79% move for the day.

Jeff Bailey : 5/31/2005 2:28:01 PM

Current OPEN MM Profiles found at this Link

Jonathan Levinson : 5/31/2005 2:25:05 PM

The short cycles indicators are showing their first downtick on the pullback from the 30 min channel breach, but it will take a break of 72 SMA support at 38.04 below the current confluence support of 38.10 to confirm a new short cycle downphase. So far, price is net unchanged from its morning levels and has yet to break free of Friday's range.

Jonathan Levinson : 5/31/2005 2:20:40 PM

Nymex crude is down .025 at 51.825 with 10 minutes remaining in the regular session. The high was 51.875.

Linda Piazza : 5/31/2005 2:20:37 PM

The OEX wasn't exactly slapped back when it hit the 567-ish S/R, but it so far hasn't been able to maintain prices above that. I'm really not surprised at what's developed today. I've mentioned that there were multiple support levels below the OEX and also presumed strong resistance levels. The sum and total of today's trading pattern is that the OEX is chopping around within a consolidation pattern that it's been trading in for a while.

Jeff Bailey : 5/31/2005 2:08:32 PM

02:00 Internals found at this Link

Linda Piazza : 5/31/2005 2:07:03 PM

The OEX turns back again, but bears need to be aware of the possibility of an inverse H&S forming on the 15-minute chart. They'll want to see a new LOD fairly quickly, and wouldn't instead want to see a steadying near 556 and then a turning up again through 567.20 or so.

Linda Piazza : 5/31/2005 2:03:19 PM

Mid-channel resistance holding so far on the OEX, but there's now a suggestion of an inverse H&S on the 15-minute chart, with a right shoulder still to be formed.

Jeff Bailey : 5/31/2005 2:01:44 PM

02:00 Market Watch at this Link

Linda Piazza : 5/31/2005 1:57:26 PM

The RLX is driving a lot of this upside as it's really zooming. Touching the bottom of the consolidation zone from late last week, though.

Jonathan Levinson : 5/31/2005 1:56:56 PM

QQQQ 100 tick chart update at this Link with price briefly violating upper rising 30 min channel resistance below the declining 60 min top. The short cycle indicators are approaching overbought territory, and the key will be whether the bulls can hold current levels long enough to turn the 60 min cycle back up.

Linda Piazza : 5/31/2005 1:54:52 PM

A bigger push this time, up to test mid-channel resistance on the OEX, as well as historical S/R near 567.

Jeff Bailey : 5/31/2005 1:51:57 PM

Little buy program kicking in here.

Jonathan Levinson : 5/31/2005 1:49:26 PM

Ten year notes are back below 113, with TNX -6.7 bps at 4.006%. Daily chart updated at this Link

Linda Piazza : 5/31/2005 1:44:10 PM

A look at the SOX's daily Keltner chart: Link

Jeff Bailey : 5/31/2005 1:43:09 PM

Advanced Micro Devices (AMD) $16.48 +1.66% Link ... Unveils is new dual-processor chips for personal computer, which look to compete with Intel's (INTC) $27.19 -0.73% Link

Jonathan Levinson : 5/31/2005 1:36:26 PM

Volume breadth remains negative, declining volume leading 1.72:1 on the NYSE and 1.44:1 on the Nasdaq, total NYSE and Nasdaq volume light at 1.59B shares combined. QQQQ has traded 49.3M shares so far, compared with Friday's total 50.1M shares and the average daily of 101.3M.

Linda Piazza : 5/31/2005 1:36:15 PM

So far, the OEX still finds resistance on 15-minute closes at the Keltner line currently at 566.28, with more resistance up to 567.30, but Keltner support is trying to build underneath, too, just above 565.75.

Jeff Bailey : 5/31/2005 1:35:41 PM

The Netherlands? MSCI Netherlands Index (AMEX:EWN) $17.96 -2.60% Link

Jeff Bailey : 5/31/2005 1:33:34 PM

NASDAQ ETF Heatmap found at this Link

Jeff Bailey : 5/31/2005 1:31:15 PM

MSCI Italy Index Fund (EWI) $24.28 -2.25% Link

Linda Piazza : 5/31/2005 1:24:39 PM

ECB President Trichet says that the eurozone can surmount the difficulties caused by the French "no" vote and the likely one tomorrow in the Netherlands. He believes that a central bank's responsibiity is to protect price stability. The central bank will act to protect purchasing power, and he believes that will help boost consumer confidence.

Jonathan Levinson : 5/31/2005 1:23:24 PM

QQQQ breaks 72 SMA resistance and is now rising to test daily S1 from below. The 30 min channel has ticked up, but the current resistance lines up at S1 5 cents away. If QQQQ can clear it, next resistance is at the 60 min channel top at 38.20, but volume is very weak and there appears little conviction so far. Link

Jeff Bailey : 5/31/2005 1:26:48 PM

Hmmmm.... Jim's comments might explain bullishness in "shoe stocks" noted past several months. Italy's MIBTel Link

Linda Piazza : 5/31/2005 1:19:25 PM

The BIX has been sitting right at its 200-sma for a while. It's a few cents under that 363.71 level as I type. The formation has a bit of an inverse H&S look to it, but it's a continuation-form one and so not particularly trustworthy. The decline today is part of the right-shoulder formation.

Jeff Bailey : 5/31/2005 1:13:00 PM

Dynamic Materials (BOOM) $44.32 +10.02% Link ... notable new 52-weeker and all-time high at the NASDAQ.

Linda Piazza : 5/31/2005 1:12:22 PM

So far, the OEX mostly (one minor exception) finds resistance at a Keltner line currently at 566.32. It's either going to pop through that resistance or else through the support just below, however, as it's being squeezed between the two.

Jeff Bailey : 5/31/2005 1:08:23 PM

01:00 Internals found at this Link

Jonathan Levinson : 5/31/2005 1:07:13 PM

Stepping away for a few minutes.

Linda Piazza : 5/31/2005 1:07:17 PM

Interesting, Jim. (See Jim's 12:42 post.) From watching CNBC Europe in the wee hours of the morning, I'd gotten a wrong impression in the interest in stocks, I guess. I like to watch when European technical analysts give their outlooks on U.S. markets, because they seem less biased by hope that the markets will go one direction or the other.

It's a shame about the changes in Italy. (Or maybe it's not such a change. My husband's family left Sicily and immigrated to the U.S. because of the crime.)

Jonathan Levinson : 5/31/2005 1:05:39 PM

The 13-week t-bill auction generated a bid to cover ratio of 2.07 at a high rate of 2.935%, while the 26-week bill auction had 2.2 bids for each accepted at a high rate of 3.08%. The total auctioned was 32B, with indirect bidders (foreign central banks) taking $8.84B of the total.

Jeff Bailey : 5/31/2005 1:02:03 PM

01:00 Market Watch found at this Link

Jonathan Levinson : 5/31/2005 1:01:48 PM

Ten year treasuries are chopping sideways at the day highs, TNX down 6.7 bps at 4.006%. The Treasury auction result are due now.

Jeff Bailey : 5/31/2005 1:00:01 PM

Doral Financial (DRL) $11.50 -0.17% Link ... S&P lowered its long-term ratings on Doral Financial to "BB" from "BB+." The ratings remain on CreditWatch Negative, where they were placed on April 19, 2005.

Linda Piazza : 5/31/2005 12:59:13 PM

The OEX is hemmed between Keltner support and resistance, with resistance still looking slightly stronger than support.

Linda Piazza : 5/31/2005 12:53:53 PM

The SOX can't decide which direction it's going to go, with a doji for the day's candle so far.

Jonathan Levinson : 5/31/2005 12:44:56 PM

Silver is breaking out, now up .14 to a new session high of 7.45: Link

Jim Brown : 5/31/2005 12:42:37 PM

Linda, Italy was a stock information blackhole. There is very little info on TV. They are more concerned with what the soap opera stars are doing that week. I had to catch a CNN World at 4:AM to get any info in English. Then it was limited to closing numbers. It is an economy that is not interested in investing. They are just trying to survive the Euro conversion. According to locals the cost of living has more than doubled since the conversion and most have to work full time and part time just to break even. Both parents now have to work to support the family. It is not even an option. The southern half of Italy is a poverty zone of untold pain. EVERY cab driver, hotel clerk, english speaking traveler warned us repeatedly about not traveling/walking alone around Naples/Pompei. Pickpockets, thieves, etc were everywhere. The difference between Rome and Naples was night and day. You would think it was a different country.

Jonathan Levinson : 5/31/2005 12:38:29 PM

From Forbes:

BEIJING (AFX) - China is exploring ways to use some of its huge foreign exchange reserves to buy imported oil, the Shanghai Securities News reported, citing an unidentified source.

The newspaper said the plan, which was first proposed as early as 2000, would reach the twin objectives of making better use of the nation's foreign exchange and ensuring vital oil supplies.

Link

Jonathan Levinson : 5/31/2005 12:37:00 PM

Keene, I'm going one step further- moving in a few weeks to a new place that's 10 minutes by foot to my office. Ditching my car.

Keene Little : 5/31/2005 12:35:50 PM

Interesing article Jonathan. I think things will change in the automobile industry only after we pay as much for gas as most of the rest of the world (at least $5/gallon). Only then will people finally abandon their gas-guzzling road hogs (can you tell I don't drive one?).

Linda Piazza : 5/31/2005 12:34:34 PM

Jim, it's nice to have you back and to read about your vacation and enjoy it a little vicariously.

Linda Piazza : 5/31/2005 12:33:49 PM

Here comes the test by the OEX bulls that I've been expecting. Keltner resistance now being tested, with further resistance firming up from 566.97-567.54. What happens here may tell us much about the rest of the afternoon.

Jonathan Levinson : 5/31/2005 12:29:32 PM

Keene, here's an article from an oil bull whose writing I enjoy, reviewing a recent auto show in New York: Link . It's a must-read. Here's an excerpt:

The big news here was that there was so little news from the automakers themselves. Judging from the cars on display, they apparently aim to stick with the program of the now-ubiquitous low-mileage SUV war wagons as far ahead as anyone can see -- along with the still-popular gas-hogging pickup trucks based on the same chassis as the SUVs -- and the familiar cast of luxury sedans with jazzily updated electronics. There was remarkably little recognition that the civilized world -- the motoring world -- stands at the threshold of a new era characterized by the end of cheap fuel.

Tab Gilles : 5/31/2005 12:27:28 PM

Cisco (CSCO) rolling over. Link

Intel (INTC) Link

Looking for a sell signal, lets see what happens after the close. Link

Murphy Oil (MUR) Took some money off the table at $97, set stop at 10-ema. Link

Jonathan Levinson : 5/31/2005 12:27:16 PM

QQQQ edging its way higher toward the 7200 tick SMA resistance line, still printing its flagging ascent off the morning low: Link

Keene Little : 5/31/2005 12:26:10 PM

Many countries tax vehicles by their horsepower. It's a very different ballgame in most countries when it comes to cars. It's only a matter of time before the U.S. is forced to comply with world standards.

Jonathan Levinson : 5/31/2005 12:24:25 PM

Session high for July silver here at 7.37, +.067. Crude oil is up to a 12.5 cent loss at 51.725, off a low of 50.90. Ten year note yields bounced off the 4.0% line and are currently down 6.1 bps at 4.012%.

Jeff Bailey : 5/31/2005 12:23:46 PM

Pakistan ... saying it will deport senior al-Qaida militant Abu Farraj al-Libbi to U.S. for presecution for two attempts on Pakistani leader's life. "We are obviously going to deport him," said President General Perves Musharraf.

Linda Piazza : 5/31/2005 12:23:26 PM

We should be getting used to this sideways trading pattern by now, shouldn't we? The problem (or good point, if you're bullish) on the OEX is that there are multiple types of support below the OEX's current position. So far, the remains within its recent consolidation pattern.

Jim Brown : 5/31/2005 12:22:24 PM

Tab, you are exactly right. Every Italian driver is an expresso fueled kamikaze. While the lines on the roads appears to be just suggestions I was amazed by the very few wrecks. Everybody drives offensively rather than defensively and I only saw one wreck in two weeks. Simply amazing since I felt like I was risking my life with every taxi trip.

Tab Gilles : 5/31/2005 12:18:43 PM

Jim...I've traveled many times to Italy, have relatives there. It's awakening to realize how our energy and auto market is so differ ent from theirs. $6 per gallon gas. Most vehicles are turbo diesel and anyone with a 6 cyclinder is considered to be a gas guzzler. Most cars look like golf carts and they all drive like formula one drivers with an attitude...lol!

Jim Brown : 5/31/2005 12:17:25 PM

I can't even imagine what the appearance of a Hummer would do in Rome. It would probably cause a riot.

Personal scooters are the preferred transport method and make up about 20% of all traffic. I could never get over women in skirts and high heels zooming between cars in heavy traffic.

Linda Piazza : 5/31/2005 12:12:34 PM

The RLX is near its LOD, but its formation also looks slightly falling wedge-ish.

Jonathan Levinson : 5/31/2005 12:12:01 PM

Jim, the Smart Car has recently made its appearance in Montreal and is a big hit. Regular unleaded has been bouncing between 87-98 cents per litre here, and even with our potholed roads and vicious winters, I'm seeing them more and more on our streets. After staring at one parked for a few minutes, I looked up at the rest of the full-sized cars on the street and they looked... almost antique to me.

Jane Fox : 5/31/2005 12:13:04 PM

Jim I couldn't imagine what would happen if the Smart Car had an argument with an H2.

Jim Brown : 5/31/2005 12:08:08 PM

I just returned from two weeks vacation in Italy. With my recent research on the coming oil crisis I was amazed to see the difference between American cars and cars in Italy. In my two weeks I only saw TWO SUVs and no American style pickups. By far the most popular car is the Smart Four Two. This is a new mini car, which is 2500 MM long (98.4 inches) You can literally park two in the same space of a full size car. They have a 3-cylinder engine, which gets 100 KM to 1 liter of diesel. (65 miles) With Diesel selling for 1.26 Euro per liter ($4.76 per gallon) the cost to drive is very low. Top speed is 135Km, which would be a miracle on crowded Italian roads. There were LITERALLY 10 of these cars on every block in Italy and there is a six-month waiting list. The Smart Car is sold by Mercedes and sells between $16K and $20K US. Link Link

Jeff Bailey : 5/31/2005 12:07:57 PM

12:00 Internals found at this Link

Linda Piazza : 5/31/2005 12:07:16 PM

The BIX is slipping right under its 200-sma again, but perhaps forming a triangle on the top of its climb.

Jeff Bailey : 5/31/2005 12:01:35 PM

12:00 Market Watch found at this Link

Linda Piazza : 5/31/2005 11:57:28 AM

No follow-through on the OEX's decline. This could be just a pause for distribution, but if it continues too long, bulls will become emboldened and will try sending the OEX stocks higher again. What happens then--whether the OEX was slapped back or built on gains--might tell much. So far, none of that has happened. Nothing much has.

Jonathan Levinson : 5/31/2005 11:56:17 AM

QQQQ's bounce has made up for lack of traction with persistence, still edging higher below the 72 SMA at 38.08. The short cycle indicators are flashing a buy signal from oversold territory, but below 38.08, it's liable to whipsaw. The pattern looks like a bear flag or "b" distribution, and volume breadth remains 1.6:1 in favor of Nasdaq decliners.

Jane Fox : 5/31/2005 11:56:09 AM

Dateline WSJ The Supreme Court has overturned the conviction of the Arthur Andersen accounting firm for destroying documents related to its Enron Corp. account before the energy giant's collapse.

In an unanimous opinion, justices said the former Big Five accounting firm's June 2002 conviction was improper. It said the jury instructions at trial were too vague and broad for jurors to determine correctly whether Andersen obstructed justice.

"The jury instructions here were flawed in important respects," Chief Justice William H. Rehnquist wrote for the court.

The ruling is a setback for the Bush administration, which made prosecution of white-collar criminals a high priority following accounting scandals at major corporations. After Enron's 2001 collapse, the Justice Department went after Andersen first. The conviction spelled the end of Andersen, the global accounting giant that became intimately involved with Enron's management.

Jeff Bailey : 5/31/2005 11:55:20 AM

Blue Dolphin Energy (BDCO) $3.25 +47.72% Link ... reported quarterly earnings (Q1) late Friday at this Link

Jonathan Levinson : 5/31/2005 11:54:20 AM

The Fed's coupon pass was for $700M, deliverable tomorrow. Today, the Treasury is auctioning 32B in 3- and 6-month t-bills, the results of which will be released at 1PM.

Jeff Bailey : 5/31/2005 11:47:59 AM

Forrester Research brief on Winners/Losers in Web Content Management Market at this Link

Linda Piazza : 5/31/2005 11:44:00 AM

I've mentioned several times today that the 15-minute and daily Keltner charts for OEX give different views of the OEX's likely behavior, and that the presumed daily support was also joined by other types of support, such as the daily 100-sma and the 50% retracement of the March slide into the April low. Now, I see a hint of a falling wedge shape on the 15-minute chart, and that keeps me skeptical and on my toes, watching for a stronger bounce. So far, Keltner resistance on the 15-minute chart (now at 566.77-567.01 and 567.75-567.78) still holds and the OEX still sinks lower, but short-term bears would like to see a steeper fall.

Jeff Bailey : 5/31/2005 11:42:49 AM

American Intl. Group (AIG) $55.79 -1.08% Link ... Files its 10-K and reported earnings restatements that hurt its net worth. As part of the restatement, AIG cut shareholders' equity at December 31, 2004 by $2.26 billion, or 2.7%, to $80.61 billion, in line with an earlier estimate. This included an after-tax reduction of $1.19 billion for changes in estimates for the fourth quarter of 2004. Revised calculations by the insurer lowered AIG's profits by nearly $4 billion for the five years starting in 2000. The biggest of those changes came in 2004, with net income cut by $1.32 billion, or nearly 12%, to $9.73 billion from the $11.05 billion that had been reported on February 9.

Jeff Bailey : 5/31/2005 11:37:55 AM

U.S. Xpress Enterprises (XPRSA) $12.27 +11.54% Link ... Company announces it plans to sell its airport-to-airport business to Forward Air and agree to noncompete deal for $12.75 million in cash. XPRSA saying it will use the proceeds to pay down debt.

Jeff Bailey : 5/31/2005 11:34:49 AM

Triarc Co. (TRY) $15.59 +9.86% Link ... "Arby's on his mind." ... Stock jumping after company agreed to acquire the largest franchisee of its Arby's chain, RTM Restaurant Group, for $175 million in cash, plus stock and other considerations.

Linda Piazza : 5/31/2005 11:34:08 AM

OEX 15-minute Keltner resistance is now at 566.79-567.70.

Linda Piazza : 5/31/2005 11:33:08 AM

ABC News is reporting that now-91-year-old W. Mark Felt has confirmed that he is Deep Throat. He had been mentioned as a possible source over the recent years and a Vanity Fair article will apparently now confirm that.

Jeff Bailey : 5/31/2005 11:32:38 AM

Dreamworks Animation (DWA) $29.85 -7.72% Link ... Wall Street Journal reported company saw a barrage of returned "Shrek 2" DVDs during first quarter.

Jonathan Levinson : 5/31/2005 11:29:35 AM

Stepping away for 10 minutes.

Linda Piazza : 5/31/2005 11:27:37 AM

RUT slightly lower today, just below the top of a descending regression channel off the December high.

Linda Piazza : 5/31/2005 11:26:31 AM

SOX near the LOD. For reference, the 200-sma is at 427.02 and the SOX is currently at 429.02, with the LOD at 428.67.

Linda Piazza : 5/31/2005 11:23:31 AM

Presumed OEX daily Keltner support exists at 565.39.

Linda Piazza : 5/31/2005 11:22:22 AM

The OEX slides down along a descending Keltner line currently at 566.25. As long as it maintains 15-minute closes below 567.03, it might still slide down that Keltner line, but it hasn't broken down below it again since this morning's breakdown. So, weakness persists so far, but no new breakdown as yet.

Jonathan Levinson : 5/31/2005 11:16:34 AM

The US Dollar Index has now reversed its morning gains, back down to 87.36 off a high of 87.72. But gold and silver are holding their losses, gold down 3.9 at 418.50. Intraday USD Index chart at this Link

Jeff Bailey : 5/31/2005 11:10:24 AM

Bearish day trade target alert ... for the QQQQ $37.93 -0.73%

Jonathan Levinson : 5/31/2005 11:10:18 AM

Sharp drop for QQQQ, testing daily S2 here on a break below 30 and 60 min channel support.

Jeff Bailey : 5/31/2005 11:09:20 AM

11:00 Internals found at this Link

Jonathan Levinson : 5/31/2005 11:07:25 AM

On Regan's question, some use the daily TRIN readings to seek closing extremes to fade- attached is a chart applying rough trendlines. Using a view like this (on Stockcharts.com, the symbol is $TRIN) you can pick your own levels of "oversold" and "overbought." Link

Linda Piazza : 5/31/2005 11:04:52 AM

While resistance has been holding on the OEX, support has also been trying to firm. Tha support is currently being tested, with support at 566.26-566.32 on 15-minute closes.

Jeff Bailey : 5/31/2005 11:02:25 AM

11:00 Market Watch found at this Link

Jonathan Levinson : 5/31/2005 11:01:00 AM

Session low for QQQQ and NQ here. Ten year treasuries are a tick off the highs, now printing 113 1/32 as I type. TNX is down 7.3 bps to 4.0%.

Jeff Bailey : 5/31/2005 11:00:36 AM

10-year yield alert ($TNX.X) down 7.3 bp at 4.00%. Call your mortgage lender, check into refinance.

Jonathan Levinson : 5/31/2005 10:56:29 AM

Volume breadth has flipped back to negative territory for the Nasdaq, 1.41 declining shares for each advancing. On the NYSE, it's 1.95.

Jonathan Levinson : 5/31/2005 10:54:35 AM

QQQQ breaks back below 7200 tick SMA support and the daily pivot, back to a test of S1. 30 and 60 min channel support continue to hold the 38 level. Link

Jonathan Levinson : 5/31/2005 10:53:25 AM

I believe that today's Fed coupon pass is the 5th or so this month. I don't recall there having been this many during all twelve months of last year.

Jonathan Levinson : 5/31/2005 10:50:52 AM

The Fed has announced a coupon pass on top of today's 6.75B temporary repo add- no quantum announced yet, but it will be deliverable tomorrow. I will post the announcement when it's released.

Jeff Bailey : 5/31/2005 10:49:54 AM

Dow Diamonds (DIA) $104.92 -0.42% ... some sellers on re-test of WEEKLY Pivot from below.

Jeff Bailey : 5/31/2005 10:49:07 AM

Bearish day trade short alert for the QQQQ $38.17 -0.13% here, stop $38.25, target $37.93.

Linda Piazza : 5/31/2005 10:48:38 AM

The SOX bounced again, of course, remaining within a consolidation pattern from the last few days, but below daily Keltner resistance. The BIX keeled over to retest its 200-sma again, but so far remains above it. The RLX turns lower within a sort of rising wedge shape, typically a bearish formation but not always. Mixed up signals from these indicator indices.

Jonathan Levinson : 5/31/2005 10:48:30 AM

Headlines:

BUSH SEES HOPEFUL SIGNS FOR U.S. ECONOMIC OUTLOOK

BUSH SAYS WANTS ENERGY BILL BEFORE AUGUST RECESS

BUSH CALLS ON CONGRESS TO PASS CAFTA PACT

BUSH URGES CONGRESS TO RESTRAIN SPENDING

Jonathan Levinson : 5/31/2005 10:48:05 AM

Nymex crude found support at 50.90, currently trading -.55 at 51.30.

Linda Piazza : 5/31/2005 10:42:27 AM

Early last week, the TRAN bounced from the 30-minute 100-ema. Today, it's been testing that average again, but this time from the underside because it fell through it and the 130-ema this morning. That MA is at 3600.89 and the TRAN is currently at 3600.23.

Jeff Bailey : 5/31/2005 10:39:17 AM

Most Actives .... QQQQ $38.23 +0.05%, CSCO $19.47 -1.61%, SIRI $6.00 +0.50%, INTC $27.34 -0.18%, SPY $119.75 -0.41%, CPN $2.96 +9.62%, TIBX $6.00 -5.21%, MSFT $25.94 -0.49%, LJPC $0.62 +55%, AMAT $16.73 +0.48%

Jonathan Levinson : 5/31/2005 10:36:13 AM

Advancing volume has pulled ahead on the Nasdaq, leading declining volume 1.3:1. On the NYSE, declining volume leads 1.78:1.

Linda Piazza : 5/31/2005 10:34:38 AM

The OEX currently tests Keltner resistance, with that strong resistance extending up to 568.08 on 15-minute closes. Guess we'll see whether it holds or not. The climb so far look flag-like, but we've seen some of these just zoom up. So far, the resistance holds.

Jonathan Levinson : 5/31/2005 10:33:52 AM

QQQQ pushed back above the 72 SMA and the daily pivot, testing premarket resistance and holding below Friday's high. The 30 min channel downphase is stalled as the short cycle uphase kicks in. Upper 30 and 60 min channl resistance line up at 38.27-.30.

Jeff Bailey : 5/31/2005 10:28:17 AM

Current OPEN MM Profiles found at this Link

Linda Piazza : 5/31/2005 10:23:31 AM

The OEX still looks vulnerable to a decline, as seen on the 15-minute Keltner chart, and resistance actually continues to strengthen.

Jonathan Levinson : 5/31/2005 10:23:03 AM

A 6.75B overnight repo from the Fed against no expiries results in a net add in that amount. Marc, the Fed has other means of juicing the markets even as it raises rates. In recent weeks, despite the added liquidity of Treasury paydowns, the Fed has continued to be easy with its repo funds.

Jeff Bailey : 5/31/2005 10:23:17 AM

Taser Intl. (TASR) $11.53 +5.28% ... 05/16/05 close (highest since news of delayed SEC filing) was $11.68. Bulls need a close there or above in my opinion.

Jonathan Levinson : 5/31/2005 10:17:23 AM

The 30 min cycle continues to point lower for QQQ, with support now lined up with the declining 60 min channel bottom at 38.00. Price continues to drift, however, testing the 72 SMA midpoint at 38.16. By comparison, the drop in YM and ES is much sharper. If this is the topping process for the 60 min cycle, then sideways chop for potentially a few hours should be followed by a steeper drop- but the premarket highs should not be violated if that is to occur.

Linda Piazza : 5/31/2005 10:16:47 AM

If I look at nothing other than the OEX's 15-minute Keltner chart, matters are fairly clear. The OEX looks headed down, with allowance made for a potential bounce up to 568 or so. The trouble is that when I look at the daily chart, both Keltner and traditional, I see potential support between the OEX's current 566.64 level and the 15-minute chart's downside target of 562.92.

Jeff Bailey : 5/31/2005 10:16:07 AM

Google (GOOG) $274.05 +3.01% ... just traded 100% of stacked retracement. Next level higher would be 100% of bullishly fit 38.2% at 285.07.

Linda Piazza : 5/31/2005 10:13:42 AM

SOX is staying just above the 200-week sma at 427.03 with the SOX LOD at 428.67. It's also staying right at the top of the QCharts-drawn descending regression channel. It's also still testing daily Keltner resistance at 434.51, with this particular Keltner line usually not being violated for more than a day or two.

Jeff Bailey : 5/31/2005 10:12:23 AM

10:00 Internals found at this Link Friday's Internals found at this Link

Linda Piazza : 5/31/2005 10:10:45 AM

So far, the OEX finds resistance at 566.60-567.08 Keltner resistance. That 567 level has long served as historical S/R, too.

Jonathan Levinson : 5/31/2005 10:07:47 AM

Session low for Nymex crude at 51.15 here. QQQQ has bounced back above S1 and has just tested declining 7200 tick resistance at 38.16. Link

Linda Piazza : 5/31/2005 10:06:32 AM

Here's a case where the 15-minute Keltner chart and the daily one show some disparity, as the 15-minute one is setting a potential downside target of 562.88, a target that will be preserved as long as the OEX continues 15-minute closes below 567.08 and maybe even if it continues closes below 568.

Jeff Bailey : 5/31/2005 10:05:19 AM

10:00 Market Watch at this Link

Jonathan Levinson : 5/31/2005 10:01:58 AM

Headlines:

U.S. MAY CONSUMER CONFIDENCE RISES TO 102.2 VS 97.5

U.S. MAY CONSUMER CONFIDENCE ABOVE CONSENSUS 95.9

U.S. MAY CHICAGO PMI FALLS SHORT OF 61.1 EXPECTED

U.S. MAY CHICAGO PMI 54.1 VS. 65.6 APRIL

Jonathan Levinson : 5/31/2005 10:01:08 AM

Chicago PMI 54.1 vs 62.0 exp.

Linda Piazza : 5/31/2005 10:02:18 AM

The OEX headed down to presumed daily Keltner support at 565.42, but the economic releases are bouncing it a little as I type. Remember that this is on a daily chart and even if the OEX were to pierce that and then bounce back above it by the day's close, that support still held, so it would be possible for it to be released on an intraday period.

For now, this bounce is bringing the OEX back up to test just broken 567 resistance. It looks now as if the OEX might roll down from here or from 568-ish resistance without a strong bounce program to move it.

Jeff Bailey : 5/31/2005 10:01:06 AM

Buy Program Premium ... SPX 1,194.19, DIA $104.96, QQQQ $38.11

Jonathan Levinson : 5/31/2005 10:00:51 AM

Consumer Confidence 102.2 vs 96.0 exp.

Jeff Bailey : 5/31/2005 10:00:01 AM

Swing Trade Bullish Stop alert ... for Wells Fargo (WFC) $60.60 -0.29% ...

Jeff Bailey : 5/31/2005 9:58:40 AM

Sell Program Premium ... SPX 1,194.28, DIA $104.96, QQQQ $38.08

Linda Piazza : 5/31/2005 9:54:08 AM

The OEX couldn't hold onto its bounce attempt and is now hitting potential 567 historical and Keltner support. This should be good for another bounce attempt, with that 568.40-ish Keltner resistance above. On a 15-minute close beneath the Keltner line currently at 566.84, the OEX sets a downside target of 563.03, but the daily chart says there might be support at 565.54 or so, too. Potentially strong support, although no support has held up so far today.

Jonathan Levinson : 5/31/2005 9:53:37 AM

QQQQ continues to struggle with daily S1 (100 tick chart at this Link ) with the 30 and 60 min channel bottoms edging lower toward 38 here.

Jonathan Levinson : 5/31/2005 9:52:36 AM

The SOX engulfsits previous gains in a steep drop, down to 429.45 here.

Linda Piazza : 5/31/2005 9:51:45 AM

AMAT had opened way higher, NVLS gapped up and holds most of gains and STM gapped up, too. Haven't made it through all of the SOX components yet, but those are the only gainers I found, and AMAT has long since erased its gains, dragging the SOX back with it. I wondered about that since Japanese semi-related stocks hadn't performed well.

Jonathan Levinson : 5/31/2005 9:51:21 AM

Volume breadth has deteriorated, declining volume now leading 1.88:1 on the NYSE, TRIN 1.28, and 1.42:1 on the Nasdaq, TRINQ .94.

Jeff Bailey : 5/31/2005 9:51:05 AM

VIX.X 13.11 +7.90% ... DAILY Pivot Levels ... 11.94, 12.05, Piv= 12.24, 12.35, 12.54.

Jonathan Levinson : 5/31/2005 9:47:41 AM

July crude oil -.525 at 51.325 here, off a session low of 51.225, high of 51.85.

Jeff Bailey : 5/31/2005 9:47:19 AM

Sector Winners ... Airline (XAL.X) 50.56 +2.14% Sector Losers ... Gold Bugs ($HUI.X) 182.01 -2.52%, Oil Service (OSX.X) 133.22 -1.07%, Oil (OIX.X) 457.15 -1.06%

Linda Piazza : 5/31/2005 9:46:52 AM

Well, the OEX tested Friday's low before it could even complete that first 15-minute period. It's rising now toward Keltner resistance, or attempting to do so, with that resistance currently at 568.29-568.43. Next support is at 566.90-567.10. They look about equally weighted.

Jeff Bailey : 5/31/2005 9:45:18 AM

Treasuries find early morning bid with 10-year yield ($TNX.X) down 4.0 bp at 4.033%. Dollar surges with U.S. Dollar Index (dx00y) 87.58 +1.34% ... multi-month high against the euro.

Jonathan Levinson : 5/31/2005 9:43:02 AM

Session lows across the board, QQQQ down 7 to 38.14 and breaking below 3200 tick SMA support.

Jeff Bailey : 5/31/2005 9:42:23 AM

July Crude (cl05n) $51.33 -1.00% (30-min delayed) ...

Jeff Bailey : 5/31/2005 9:41:16 AM

Sirius Satellite Radio (SIRI) $6.00 +0.50% Link ... "X gets the square" and #1 most active. XM Satellite Radio (XMSR) $32.42 +1.91% Link ... S&P Equity reiterates "hold" rating and raises its target price to $36 from $32, forecasting positive free cash flow in 2006.

Linda Piazza : 5/31/2005 9:40:46 AM

AMAT started out really high, but it's showing a steep decline now.

Linda Piazza : 5/31/2005 9:40:12 AM

The OEX threatens to close the first 15-minute period below a Keltner level currently at 568.36, suggesting a downturn toward 567, but Friday's low at 567.44 might also be presumed to be potential support. There's a rough sort of H&S on the OEX's chart, not yet confirmed.

Jonathan Levinson : 5/31/2005 9:39:03 AM

Ten year notes are holding above gap support, with TNX down 3.9 bps at 4.034%, a .96% decline this AM. 22 minutes to go until the Chicago PMI, est. 62, and Consumer confidence, est. 96.

Jeff Bailey : 5/31/2005 9:38:23 AM

Calpine (CPN) $3.134 +16.29% ... breaks above its trending lower 200-day SMA ($3.06) and #2 most active.

Jonathan Levinson : 5/31/2005 9:36:20 AM

Here are the market percent gainers as of the pre-open: AGR.A +11.36 +908.8% LJPC +0.2 +50% ITCD +35.59 unch% GTE +1.09 +28.84% IIJI +15.25 unch% CPN +0.39 +14.44% MFCO +0.19 +13.29% SCON +0.07 +10.61% DRAM +0.48 +10.32% XPRSA +1 +9.09%

Linda Piazza : 5/31/2005 9:35:03 AM

I don't know yet which stocks are pumping the SOX, Marc. Haven't had a chance to check the components. I was running through a few and haven't found it yet. Wonder if Jeff knows?

Jonathan Levinson : 5/31/2005 9:33:15 AM

Volume breadth is negative at the open, with declining volume leading 1.23:1 on the NYSE and 1.05:1 on the Nasdaq.

Linda Piazza : 5/31/2005 9:33:36 AM

The OEX did test that 568.30 level this morning, dipping down within a dime of that level, and now bounces. Bulls would prefer that it close back over a Keltner line currently at 568.81, but the OEX is still within a recent consolidation pattern and there's not a lot of clarity just yet.

Jeff Bailey : 5/31/2005 9:32:55 AM

TIBCO (TIBX) $5.62 -11.21% Link ... lower and atop this morning's most active after the business software maker said its preliminary Q2 results indicate earnings will be below analysts' estimates due to slowdown in closing several large deals.

Linda Piazza : 5/31/2005 9:31:34 AM

Semi-related stocks did not perform well in Japan last night due to a report about orders in semi-equipment making companies, but the SOX zooms up this morning.

Jeff Bailey : 5/31/2005 9:28:36 AM

Dow Diamonds (DIA) with updated WEEKLY Pivot retracement at this Link ... DASHED PINK is preliminary MONTHLY R1 for June, which I'm looking to sell a NAKED call against.

Jonathan Levinson : 5/31/2005 9:23:10 AM

QQQQ is bouncing from its earlier lows, back to last Friday's range and up .01 to 38.22 here. The 30 min cycle is maxxed out to the upside and currently trending, while the 60 min is in a weak upphase just below overbought territory. A drop from here would convert that upphase into a bearish divergence, but until that occurs, the bias remains up. 30 and 60 min channel support are lined up at 38.04, with confluence support at 38.00. A move below 38 should be enough to confirm a breakdown in the intraday cycles, below which 38.60 is key support for the daily cycle.

Linda Piazza : 5/31/2005 8:51:09 AM

The OEX spent last week challenging 570, the 61.8% retracement of the decline off the March high into the April low. So far, it hasn't been able to sustain a move above that Fib level, but it's been supported mostly above 565.50-565.75 but also by the by the 50% retracement of that same decline, at about 564.81 and the 100-sma at 564.70. In other words, the OEX consolidates. Another retest of 570 looks possible as does a retest of the 568.30 area or perhaps even the 565.50-565.75 level, with about equal weighting giving to support and resistance on the 15-minute and daily Keltner charts. As we move toward the open, we do so in a climate in which forex markets have seen big moves due to the French referendum nixing the EU constitution, and the dollar's strength against other markets may be an equity-moving event, too. Often a strengthening in the dollar is seen as a negative for equities, but that's not always a moment-by-moment correlation, and I'm not sure it holds as true in a climate in which many also fear that a Chinese revaluation of its currency might lead to a weakening of the dollar against Asian currencies. There's much to balance, and the way investors balance that equation might not be predictable as there are too many variables.

Markets need a strong thrust one direction or the other to get something going. If that strong thrust is up through recent highs and is maintained, the daily Keltner chart suggests a possible upside of 576.09. Persisting Keltner style bearish divergence would be undone if the OEX pierces that Keltner resistance by much, and would be continued if that level were only brushed or not even touched. Although Keltner's don't give much information about most likely direction, futures suggest that test of 468.30 might occur at least.

Jonathan Levinson : 5/31/2005 8:45:16 AM

Session high for ten year notes at 113 1/64 just now. June euro futures are down 2.01% at 1.2337, off a low of 1.2317. 5-day 100-tick chart of June euros at this Link

Jonathan Levinson : 5/31/2005 8:31:56 AM

The US Dollar Index is holding its sharp early morning gains, currently +1.27 at 87.68 with August gold just hitting a session low of 416.30, -6.10.

Jonathan Levinson : 5/31/2005 8:26:19 AM

Ten year notes are holding their gains, with TNX currently down 3.1 bps at 4.042%. Daily chart showing today's minutes-old candle at this Link

Jonathan Levinson : 5/31/2005 8:14:34 AM

AIG has filed its delayed 10K, reporting a decline in market cap of 2.7% or $2.26B in 2004. Its net income figure originally reported has been reduced by $1.32B to $9.73B. The company's 10Q is expected to be released by the end of June. AIG is currently +.90 at 57.30. At this Link is a log chart from 1972, each candle one quarter, showing the long term trendline break and this quarter's ongoing bounce below it.

Jonathan Levinson : 5/31/2005 7:41:56 AM

Equities are down, ES trading 1198.25, NQ 1549.5, YM 10538 and QQQ -.04 at 38.17. Gold is down 4.20 to 418.20, silver -.153 to 7.15, and crude oil is down .475 to 51.375. Ten year treasuries are down 5/16 to 112 15/16.

We await the 10AM release of the Chicago PMI, est. 62, and Consumer Confidence, est. 96.

Linda Piazza : 5/31/2005 6:55:27 AM

Good morning. Although our markets were closed yesterday, global markets other than the U.K.'s opened. The Nikkei posted a 74-point gain and almost all other Asian bourses climbed, too. As had been rumored would happen, France's citizens rejected the EU constitution, throwing the future of the European Union into disarray. All EU member nations must approve the constitution for it to go into effect. The euro has been falling steeply against the dollar since forex markets opened Sunday night, but the CAC 40 was to eke out a small gain Monday. Tuesday, it was the Nikkei's turn to eke out a small gain, as did many other Asian markets. Most did gain, however. European markets decline under the weight of the political developments this week. Our futures are negative. As of 6:40 EST, gold was down $4.30, and crude, down $0.35. More detail about Asian and European markets follows in succeeding paragraphs.

Tuesday, the Nikkei was to erase some of Monday's gains within a few minutes of its open, but it spent the rest of the day climbing off that early morning low. It closed higher by 10.26 points or 0.09%, at 11,276.59. April's unemployment rate was a smaller-than-expected 4.4% with job/applicants ratio a higher-than-expected 0.94. Bloomberg noted that this was a more-than-six-year low for the unemployment rate. According to another source, a glance underneath the headline numbers showed that more people are willing to work and even look for better jobs, and more companies are willing to hire. April's wage-earnings spending fell 3.1% year over year, however, slightly worse than the expected 3.0% fall. Wage earners' real earnings rose 1.1% year over year. A figure termed the consumption propensity ratio fell 6.0% when compared to last year's strong consumption figures. The Bank of Japan's Governor Fukui spoke about his concerns about the timing at which Japan's super-accommodative monetary policy might be changed, saying that he'd like to end that during his term but that it must be done at the right time. His term ends in 2008.

Monday's economic and industry reports in Japan should not be ignored, either. April's industrial output was reported as rising a seasonally adjusted 2.2% from March's number. However, despite this first gain in three months, the Ministry of Economy, Trade and Industry forecast that production would fall 2.3% in May, revising its previous forecast lower from 1.4%. After Monday's close, the Semiconductor Equipment Association of Japan released figures showing that orders for chip-making equipment fell 35.4% in April as compared to March's orders. That report was to send semi-related stocks lower in Tuesday's trading.

Most Asian markets gained Tuesday. The Taiwan Weighted gained 0.03%, and South Korea's Kospi climbed 0.12%. On Monday, South Korea's April industrial production was reported as falling a seasonally adjusted 1.7%, a far worse-than-expected result. The current account showed a deficit for the first time in two years. As a result of the data, the chief economist for the government announced that the government's projected 5.0% growth target for 2005 might not be met. Singapore's Straits Times fell 0.47%, but Hong Kong's Hang Seng climbed 0.16%. China's Shanghai Composite climbed 0.05%. Monday, China discontinued duties on 81 textiles as a U.S. envoy was due to visit. China had scheduled tariff increases on 74 other textile categories, but will not go forward with those plans. At least on CNBC, this was seen as an escalation of the trade wars with China.

Most European markets decline. Today, France's PM resigned and a new one was appointed, with the euro dipping even further as this happened. Tomorrow, the Dutch vote in their referendum on the EU constitution, with a "no" vote in that election further weakening prospects for European integration and therefore weakening the European currency. The Dutch people are widely expected to vote "no." In other economic news, the U.K.'s May GFK consumer confidence indicator fell to -1, to its lowest number since December. A drop in the climate for major purchases component drove that number lower. France's unemployment rate stayed at 10.2% in April, with that being its highest rate in more than five years. CNBC also reports that Germany's unemployment rate was high, above 11.0%, but print sources aren't yet reporting the number. The EU Commission's May survey showed sentiment declining to 96.1 from April's 96.5, with high unemployment being responsible for part of that decline.

Companies reporting included Irish low-cost airline Ryanair Holdings, soaring after its report. That report included information that it had hedged 3/4 of its winter fuel needs at $47.00 per barrel. It has not hedged on oil prices for the rest of the summer, however. In other news, Prudential Equity Group upgraded DaimlerChrysler to a neutral rating from its previous underweight rating.

As of 6:32 EST, the FTSE 100 had fallen 1.10 points or 0.02%, to 4,985.20. The CAC 40 had dropped 7.32 points or 0.18%, to 4,127.55. The DAX had fallen 16.33 points or 0.36%, to 4,464.10.

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