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Keene Little : 1/30/2007 1:40:48 AM

Some ideas for tomorrow. I'm looking for confirmation of the next leg down or evidence we'll get another leg up into Wednesday (see notes on charts):

DOW 60-min: Link
SPX 60-min: Link
NDX 60-min: Link

Futures premium:
YM: +33
ES: +5
NQ: +9

Jeff Bailey : 1/29/2007 11:21:55 PM

Nikkei-225 ($NIKK) currently up 78.62 points, or +0.45% at 17,549.09 Link ... Session low/high so far has been 17,502.24/17,558.53.

Jeff Bailey : 1/29/2007 11:17:20 PM

Mixed Japan Data May Make BOJ Rate Hike Tough

DJ- More data suggesting private consumption in Japan remains weak were released Tuesday, further reducing market expectations that the Bank of Japan will be able to hike interest rates next month.

However, the corporate sector continued to look strong, with better-than-expected industrial production data for December.

Spending by Japanese households headed by wage earners dropped 3.3% in December in real terms from a year earlier, while overall household spending fell a real 1.9% in December on year, government data showed.

But other data revealed that industrial production expanded 0.7% on year in Japan in December, beating economists' expectations for a 0.2% rise.

Meanwhile, the nation's unemployment rate rose to 4.1% in December from 4.0% in November, according to government data.

The sluggish spending figures will give ammunition to ruling party and government officials calling on the BOJ to hold off on increasing interest rates. At its policy board meeting earlier this month the central bank kept the overnight call rate target unchanged at 0.25% after intense political pressure to support the economy.

"The data was a mix of strong and weak," said Morgan Stanley economist Takehiro Sato. "And Friday's CPI wasn't very good. So, I don't think they will be decisive factors" in determining whether the central bank will tighten monetary policy in February, he said.

Data released Friday showed that the core nationwide consumer price index, which excludes volatile fresh food prices, eked out a 0.1% rise on year.

The BOJ is thought to be looking closely at private consumption data to see whether a booming corporate sector is supporting consumption, with the results expected to influence the central bank's interest rate decisions in the near term. Tuesday's weak household spending data, therefore, led to buying of Japanese government bonds on speculation it will stand pat on policy again next month.

The lead March JGB futures finished Tuesday's morning session up 0.03 at 134.38 after briefly rising to as high as 134.47. The yield on the newest 10-year cash JGBs was down 0.5 basis point at 1.715%.

Currency players used the better-than-expected output data as an excuse to take profits on the dollar and euro against the yen, pushing the Japanese currency higher. The euro briefly went from Y157.75 to Y157.40 and currently is changing hands at Y157.70, while the dollar dropped from Y121.80 to Y121.60.

Jeff Bailey : 1/29/2007 10:56:48 PM

Per Tonight's Market Wrap ... Pacholder High Yield (AMEX:PHF) $10.12 +0.49% ... NAV, Stock Price and Premium/(Discount) Link

Additional Note: A monthly dividend of $0.075 will be payable on 02/09/2007 to shareholders of record on 01/31/2007 (Wednesday). The ex-date for the dividend was today, 01/29/2007.

Keene Little : 1/29/2007 10:31:29 PM

Tuesday's pivot tables: Link and Link

OI Technical Staff : 1/29/2007 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 : 1/29/2007 5:19:44 PM

Closing Internals found at this Link

Jeff Bailey : 1/29/2007 4:32:22 PM

US Oil Fund (AMEX:USO) closed down $1.31, or -2.83% at $44.97.

Jeff Bailey : 1/29/2007 4:31:02 PM

March Crude Oil futures (cl07h) settled down $1.41, or -2.54% at $54.01.

Jeff Bailey : 1/29/2007 4:22:57 PM

Closing U.S. Market Watch found at this Link

Jeff Bailey : 1/29/2007 4:06:38 PM

CME's May, Aug and Nov Regional Housing Futures as of Friday's Close at this Link

Jane Fox : 1/29/2007 4:03:19 PM

Economic reports for tomorrow include

8:30a.m. Dec Personal Income. Previous: +0.3%.

8:30a.m. Dec Personal Spending. Previous: +0.5%.

10:00a.m. Conference Board Consumer Confidence Index. Expected: 110.0. Previous: 109.0.

Jeff Bailey : 1/29/2007 4:01:21 PM

States Work to Address Foreclosure Fraud

AP Story Link

Keene Little : 1/29/2007 3:55:46 PM

MER has broken Friday's low and looks like it's going to close near the low of the day. The broker index (XBD) is in the same boat, one that looks to be taking on water.

Keene Little : 1/29/2007 3:45:53 PM

I've seen enough of these bear flags that we're getting off this afternoon's low suddenly explode to the upside so I take nothing for granted in this market. But the higher odds play here is that this afternoon's consolidation will lead to a continuation of the decline tomorrow. A break of Friday's low, that stays below, will be bearish. Until that happens we could easily get another leg up to match the one off Friday's low. A choppy consolidation into Wednesday would not be out of the ordinary.

Jeff Bailey : 1/29/2007 3:30:44 PM

Citigroup To Buy Egg Banking for $1.13B ... AP Story Link

Keene Little : 1/29/2007 3:27:05 PM

Getting another leg up in the bounce. Two equal legs up for ES is at 1427.50 and for YM it's hitting it now at 12542.

Jeff Bailey : 1/29/2007 3:26:46 PM

Buy Program Premium ... YM 12,538 : SPX 1,421.50

Jane Fox : 1/29/2007 3:15:05 PM

Internals are saying we should have a bearish last hour but the market doesn't seem to agree with them.

Jeff Bailey : 1/29/2007 3:13:23 PM

03:00 Internals found at this Link

Jane Fox : 1/29/2007 3:09:29 PM

Internals are quite bearish and it is no time to be long. Link

Jeff Bailey : 1/29/2007 3:03:01 PM

03:00 Market Watch found at this Link

Marc Eckelberry : 1/29/2007 3:02:47 PM

I covered my short at ES 1425. Those advdec lines are supportive. I can always re-enetr.

Jane Fox : 1/29/2007 3:00:51 PM

TICKS back to +800.

Jeff Bailey : 1/29/2007 2:56:42 PM

Treasury's Paulson: US Economy Heading Toward "Sustainable" Growth

DJ- Treasury Secretary Henry Paulson said Monday the U.S. economy is making the transition from an unsustainable growth rate to a sustainable pace of expansion.

In remarks to open an economic roundtable at the Treasury Department, Paulson said "here we are in January of 2007...[and] it looks like we've made the transition from an unsustainable rate of growth to something that looks very sustainable, something like 3% a year."

However, Paulson cautioned that there were no certainties when dealing with economic forecasts.

The Treasury secretary also said inflation was at a "very manageable level."

Paulson noted that the current period of economic strength will make it easier to tackle high-profile Bush administration policy priorities, such as entitlement reform and energy security.

Jane Fox : 1/29/2007 2:55:13 PM

WASHINGTON (MarketWatch) -- The number of vacant homes waiting to be sold surged 34% to 2.1 million at the end of 2006 compared with the end of 2005, by far the fastest increase ever recorded, the Census Bureau reported Monday.

A year ago, 1.57 million homes were vacant and awaiting a sale.

The vacancy rate for owned units jumped to a record 2.7% from 2.0% a year earlier. From 1965 to 2005, the homeowner vacancy rate had never been above 2%. The long-term average is 1.4%.

"We have more than a million housing units of excess supply," said James O'Sullivan, an economist for UBS. "If you are looking for evidence that the worst is over for housing, you're not going to find it in this report. This argues that housing starts need to go down more."

Jane Fox : 1/29/2007 2:54:17 PM

TICKs back to -800.

Keene Little : 1/29/2007 2:49:26 PM

So far the little bounce off this afternoon's decline is looking corrective. With the appearance of a bear flag it looks like the decline will continue this afternoon. I would not want to buy it here even if it manages to push a little higher.

Jane Fox : 1/29/2007 2:38:40 PM

* Paulson says he has some caution about good U.S. outlook *
Paulson says economy strong, inflation at 'manageable' level

Jeff Bailey : 1/29/2007 2:28:15 PM

Saudi Envoy: US Military Strike On Iran Would Be "A Nightmare"

DJ- Saudi Arabia ambassador to the US Turki al Faisal said Monday that not only would a nuclear armed Iran be "a nightmare," but so would a U.S. military strike on Iran to interrupt an alleged nuclear weapons program.

Jeff Bailey : 1/29/2007 2:24:39 PM

Sell Program Premium ... YM 12,529 : SPX 1,420

Jeff Bailey : 1/29/2007 2:21:19 PM

Buy Program Premium ... YM 12,530 : SPX 1,420

Jane Fox : 1/29/2007 2:21:13 PM

TICKS back to +800 Go figure!

Marc Eckelberry : 1/29/2007 2:07:17 PM

ES 50 dma at 1425.50 needs to hold. I suspect it will if TNX manages to pull back. otherwise it's 1417.25 by tomorrow.

Keene Little : 1/29/2007 2:07:05 PM

The bounce from Friday's lows could be the end of the correction to the decline from last week's highs. The sharp decline in the past hour has the markings of the start of a stronger 3rd wave down. But don't take anything for granted here--we could see this pullback lead to another rally into Wednesday which would give us a larger A-B-C correction. It takes a break below Friday's lows, and stay below, to suggest we're into the 3rd wave down, in which case it would then be time to just hold on for the ride.

Jeff Bailey : 1/29/2007 2:06:06 PM

S&P 500 Index (SPX.X) 1,419.67 -0.17% ... It would currently take a trade at 1,410 for the SPX's PnF chart Link to reverse lower by 3-boxes.

Jeff Bailey : 1/29/2007 2:03:49 PM

Sell Program Premium ... YM 12,527 : SPX 1,420

Marc Eckelberry : 1/29/2007 2:03:27 PM

Jane, they were concerned, but hoping for a drop. When we hit 4.9%, it triggered all the sell stops. Either that or it was a trap. You could have daytraded that to the tick, put up TNX (or better, ZN) and ES side by side and look what happens when TNX hit 4.9.

Marc Eckelberry : 1/29/2007 2:01:29 PM

The entire rally from August was based on falling rates. The entire decline in 2007 will be based on rising (or steady at highs) rates. It is always like that and if you try and fight it, you will lose. It was a terrible mistake to fight the bulls in October/November when rates were dropping. Don;t make the inverse mistake now. The bull run is over, I think and it's short the rallies mode until rates drop again.

Jane Fox : 1/29/2007 2:01:08 PM

Not disputing what you are saying Marc it is just that yields are more of a swing trading tool than daytrading, as far as I'm concerned.

Jane Fox : 1/29/2007 2:00:05 PM

The thing is Marc why at 1:00EST did the market all of sudden become concerned with yields.

Marc Eckelberry : 1/29/2007 1:57:52 PM

Nothing matters but interest rates, Nothing. Stocks cannot continue a 5 year bull market with rates rising above these levels. It just can't happen and neither can housing make it back.

Marc Eckelberry : 1/29/2007 1:56:49 PM

Jane, it's yields. I have been typing about this several times while we rallied, warning our readers.

Jane Fox : 1/29/2007 1:55:59 PM

So much for our long positions. Hopefully you took profits or at least put your stop to breakeven. Welcome to the stock market.

Jeff Bailey : 1/29/2007 1:55:23 PM

GSO.X 183.56 +0.10% ... MONTHLY Pivot (185.69) served resistance late this morning.

Jane Fox : 1/29/2007 1:54:51 PM

And here we go again. TICKS -1000. What brought in the sellers like this?

Jeff Bailey : 1/29/2007 1:54:26 PM

QQQQ $43.60 +0.06% ... MONTHLY Pivot.

Marc Eckelberry : 1/29/2007 1:49:55 PM

If anyone needed any proof that yields above 4.85% are trouble, we just got it. 4.9% is where we sold off last week. Bulls are now hoping that this was a double top. Watch NQ 1788.75, overnight high.

Jane Fox : 1/29/2007 1:46:42 PM

Too Funny TICKS now -1000.

Jeff Bailey : 1/29/2007 1:45:55 PM

Fertilizer Stocks Rise On Outlook For Surging Corn Demand

DJ- Fertilizer stocks rose Monday, continuing strong gains amid renewed interest in biofuels, particularly corn-based ethanol, and following Mosaic Co. (MOS) issuing a bullish outlook for the sector.

Shares of Mosaic were up 88 cents, or 4.4%, at $20.83, with nearly double the average daily volume of shares traded. Shares of peers also rose, with CF Industries Holdings Inc. (CF) trading up 11% to $31.88, Potash Corp. of Saskatchewan Inc. (POT) up 4.5% at $154.41, Agrium Inc. (AGU) up 2.1% at $33.95 and Terra Industries Inc. (TRA) up 4% at $14.29.

CF Industries spokesman Charles Nekvasil declined to comment in particular on the stock price's sharp rise Monday but said the company has been benefitting from the ethanol craze, as it has a 30% market share in the U.S. corn belt.

"The ethanol boom in the corn belt is right in the sweet spot of our market," Nekvasil said.

In addition, both Tyson Foods Inc. (TSN) and Archer Daniels Midland Co. (ADM) said Monday that demand for corn for ethanol was driving up prices.

Meat producer Tyson warned the diversion of corn from animal feed into fuel production could result in consumers paying "significantly" more for food at supermarkets and restaurants.

Earlier this month, a U.S. Department of Agriculture report on the 2006 corn production and stocks came in tighter than forecast, sending the March contract for corn futures to its highest level ever on the Chicago Board of Trade.

Analysts then said they see the report as further support for a rise in corn plantings this spring, which will boost demand for fertilizer.

Mosaic's chief executive, Jim Prokopanko, echoed this outlook Monday saying in a press release that supply and demand fundamentals for all major nutrients, particularly phosphates and nitrogen, were tightening as the North American spring planting season approached.

"The strong demand for biofuels, particularly ethanol, grain carryover stocks at 30-year lows, and high grain prices have created an exciting business environment for farmers and the fertilizer industry," Prokopanko added.

JPMorgan analyst David Silver said investors would view Mosaic's upbeat outlook for nitrogen as a boon for peers for CF Industries and Agrium, though weaker phosphate margins could prove a modest negative for CF and Potash.

Producers of ethanol rose sharply ahead of President George W. Bush's State of the Union address last week, in which Bush called for a 20% reduction in U.S. gasoline consumption.

While traders treated the speech as a "buy the rumor, sell the fact" situation, sending commodity prices and many related stocks back down to pre-speech levels, demand for corn - the dominant source of ethanol fuel in the U.S. - is still expected to continue growing.

Keene Little : 1/29/2007 1:43:38 PM

Equity bears may get a helping hand from what yields are doing. After breaking above their 200-dma's, which I thought would act as resistance, it appears the 10 and 30-year (TNX and TYX) are consolidating on top. That would be bullish for yields (bearish for bonds and likely equities) if it stays that way (4.85% for TNX and 4.95% for TYX). The only caution I see today is a potential retest of Friday's high in yields with a bearish divergence today.

Jeff Bailey : 1/29/2007 1:39:08 PM

I've been seeing quite a bit of "higher yielding" corporate debt being retired in recent months.

Keene Little : 1/29/2007 1:38:59 PM

The bounce pattern is a bit ugly and therefore hard to count on the shorter term charts. But it would look better if we get another new high to complete the leg up from this morning's low. I'm not sure we'll get it but if we do get a minor new high with bearish divergences I'd try shorting it. The setup is a good one for the bears.

Jeff Bailey : 1/29/2007 1:36:14 PM

Town Sports Intl. Announces Cash Tender Offer And Related Consent Solicitation For Outstanding Debt Securities

Town Sports Launches Offer For 9 5/8% Sr Notes Due 2011

CLUB $20.31 +1.14% ...

Press Release Link ...

Keene Little : 1/29/2007 1:26:14 PM

As a heads up for a bearish possibility on the techs, the wave count is set up for a potential 3rd of a 3rd wave down after the bounce off Friday's low completes. The sharper bounce in YM is also a potential 2nd wave bounce and could lead to a 3rd wave decline sooner than what I had projected on YM's chart below (2:12 AM).

This scenario suggests a sell off before FOMC on Wednesday. There are lots of reasons not to trust this scenario but if I were going with nothing but the wave pattern I'd say heads up (or down) for a larger decline coming sooner rather than later, as depicted on this NDX 60-min chart. Link

Marc Eckelberry : 1/29/2007 1:26:02 PM

NQ has key support at 1791/1792, weekly pivot and daily R1.

Marc Eckelberry : 1/29/2007 1:25:35 PM

TNX 48.94 and ES loses its 20 dma (1431).

Jeff Bailey : 1/29/2007 1:27:14 PM

First Financial Announces Stock Repurchase Program

DJ- To Buy Back Up To 600,000 Shares, Or 5% Of Stock

FFCH $35.16 +2.53% ...

Press Release at this Link

Keene Little : 1/29/2007 1:13:16 PM

This 15-min chart of NQ shows the bounce from Friday morning's low and the potential bear flag pattern. Between two equal legs up for an A-B-C bounce at 1795.50 and the 50% retracement of the drop from Thursday morning at 1797.25, this could be the top of its bounce. If we see a consolidation near the high then it would be risky to stay in a short. Wait for another one with bearish divergences. Link

Jeff Bailey : 1/29/2007 1:12:42 PM

01:00 Internals found at this Link

Marc Eckelberry : 1/29/2007 1:11:43 PM

It's all about interest rates, the rest is noise. TNX 4.89% is the danger zone. In fact, anything over 4.85% is not good for stocks. Enjoy the rallies, but don't hold them overnight.

Jeff Bailey : 1/29/2007 1:04:16 PM

01:00 Market Watch found at this Link

Marc Eckelberry : 1/29/2007 12:59:54 PM

Traders might be anticipating that bonds are oversold and yields will drop. But for now, that is a dangerous assumption.

Jeff Bailey : 1/29/2007 12:57:55 PM

Royal Dutch Shell Class A (RDS.A) $67.84 -0.52% ... DJ- Energy concern announces that on 29 January, 2007 it purchased for cancellation 400,000 "A" Shares at a price of 26.27 euros per share. It further announces that on the same date it purchased for cancellation 200,000 "A" Shares at a price of 1726.13 pence per share.

Following the cancellation of these shares, the remaining number of "A" Shares of Royal Dutch Shell plc will be 3,683,170,000.

Keene Little : 1/29/2007 12:56:35 PM

I'm back. So far we've got YM retracing just over 50% of the decline from last week's high whereas ES has only retraced 38%. NQ is in a different kind of pattern and looks like it's in the 2nd leg up of a corrective bounce that started from Friday's low. It has two equal legs up at 1795.50 and therefore heads up on that one--it could be completing its correction and ready to turn back down.

Jane Fox : 1/29/2007 12:52:30 PM

TICKS +1000.

Jane Fox : 1/29/2007 12:50:59 PM

TICKs +800.

Jane Fox : 1/29/2007 12:48:59 PM

Though I would post these charts just in case you have a inkling to try and catch the top with a short. YOu may get lucky but you don't stay in this game with luck, you stay in it with playing the odds and the odds are not in your favor if short. Link

Jane Fox : 1/29/2007 12:44:57 PM

LONDON (MarketWatch) -- British Airways Plc managed to avert a series of potentially damaging strikes that threatened to cripple travel out of London's Heathrow airport as last-minute negotiations yielded success with unionized cabin-crew personnel, the carrier said Monday.

Europe's third-largest airline (BAB) said it welcomed the decision by the Transport and General Workers' Union to call off strikes that had been scheduled for Tuesday and Wednesday this week and for two 72-hour periods next month.

However, the flagship U.K. carrier said the settlement has come too late to prevent disruption to the travel plans of thousands of customers. British Air said it will attempt to reinstate as many flight as possible in the next two days.

British Air's shares closed up 2.8% in London.

Jeff Bailey : 1/29/2007 12:38:56 PM

StreetTracks Gold Trust (NSYE:GLD) $64.13 +0.04% ($641.30)

Jeff Bailey : 1/29/2007 12:38:17 PM

Mini Feb Gold (yg07g) $646.90 +0.27% ...

Jeff Bailey : 1/29/2007 12:37:16 PM

U.S. Gold Prices at 12:21 PM EST

DJ- Engelhard Corp's base price for industrial gold bullion was $646.50 per troy ounce, down $0.75 from previous. Its selling price for gold in fabricated form was $694.99, down $0.80. Handy & Harman's base price for gold was $644.75 per troy ounce, down $0.75. The fabricated form price was $696.33, down $0.81.

Marc Eckelberry : 1/29/2007 12:37:09 PM

If TNX drops, then bulls will punch through.

Jeff Bailey : 1/29/2007 12:34:27 PM

AG Edwards Reiterates "Buy" On CNXT, FO, BEN, HAL, OXY, WDC.

Marc Eckelberry : 1/29/2007 12:34:18 PM

The move by ER is particularly suspect.

Jeff Bailey : 1/29/2007 12:31:53 PM

Tesoro Net Income Up 128% Year-Over-Year

DJ- Tesoro Corp. (TSO, $78.57 6.43%) said fourth-quarter earnings rose to $158 million, or $2.28 a share, from $69 million, or 97 cents a share, a year earlier. Analysts surveyed by Thomson Financial had been expecting earnings of $1.91 a share, on average. Revenue for the quarter ending December fell to $4.02 billion from last year's $4.36 billion.

See additional TSO at 12:08:34

Jane Fox : 1/29/2007 12:31:33 PM

Dateline CNN - The Associated Press reports Kentucky Derby winner Barbaro was euthanized this morning, according to one of the horse's co-owners. (sniff)

Marc Eckelberry : 1/29/2007 12:27:37 PM

With yields rising once again, rallies are short entries as long as ES stays below 1431/1433. Financials and energy are down.

Jeff Bailey : 1/29/2007 12:25:22 PM

BioCryst Pharma (BCRX) $10.16 +0.89% ...

Jeff Bailey : 1/29/2007 12:24:12 PM

Bird Flu Outbreak Reported In Southern Russia

DJ- An outbreak of bird flu has been registered in southern Russia, officials said Monday, and news reports said the cases involved the H5N1 strain that scientists are watching for fear it could mutate into a more deadly form.

The virus killed birds at three farms or households in the Krasnodar territory, an agricultural region in the southern part of European Russia on the Black Sea, according to the federal agricultural oversight agency, Rosselkhoznadzor.

An agency spokeswoman said she couldn't give details about the particular strain involved, but the RIA-Novosti news agency cited the agency's chief spokesman Alexei Alexeyenko as saying it was H5N1.

Efforts were being made to prevent the spread of the disease, Alexeyenko was quoted as saying, without giving details.

Russia recorded its first cases of bird flu in Siberia in 2005, and outbreaks have since occurred further west. There have been no human cases of bird flu reported in Russia.

According to RIA-Novosti, bird flu cases were registered in 93 towns or settlements in Siberia and southern Russia last year. The report Monday was the first since August.

The H5N1 bird flu strain has killed at least 163 people worldwide since it began ravaging Asian poultry farms in late 2003, according to the World Health Organization.

The virus remains hard for humans to catch, and most human victims were infected by direct contact with sick birds. But international experts fear H5N1 may mutate into a form that could spread easily among humans, and possibly spark a pandemic.

Jane Fox : 1/29/2007 12:23:58 PM

When I suggested getting long I thought ER would be the best vehicle to use but I see now that was not a best choice. YM would have been. BTW do you see that YM is now testing its PDH and should find resistance. Link

Jane Fox : 1/29/2007 12:21:33 PM

SAN FRANCISCO (MarketWatch) -- Dell Inc. (DELL) said Monday that customers showed stronger-than-expected interest in Microsoft Corp.'s (MSFT) Windows Vista in the first weekend of the new operating systems' availability. The Round Rock, Texas-based computer maker said it took orders for thousands of Vista-enabled desktop and notebook systems on Saturday and Sunday. Dell added that it has been working with Microsoft since 2003 to develop and test Vista on more than 100 applications. Dell shares rose 16 cents to $23.89 in Monday afternoon trade.

Jeff Bailey : 1/29/2007 12:20:53 PM

U.S. Oil Fund (AMEX:USO) $45.42 -1.85% ...

Jane Fox : 1/29/2007 12:20:40 PM

Dateline MarketWatch - Investors are awaiting a two-day FOMC meeting on interest rates that begins on Tuesday.

The Fed is widely expected to leave the overnight rate unchanged at 5.25%, but investors will decipher the accompanying policy statement for clues about future Fed actions.

"No one expects any action from the Fed, so the outcome should be a nonevent," said Action Economics.

"The policy statement should also be unremarkable, with policymakers echoing recent data that have shown improvement in the economy, while indicating inflation pressures still remain elevated. Hence they should maintain their bias toward tightening," Action Economics said.

Jeff Bailey : 1/29/2007 12:20:20 PM

China, US SPR Build-Up Could Spur Rivalry

DJ- Taking advantage of lower oil prices, China has redoubled efforts to stock its recently launched strategic petroleum reserve, raising the prospects of higher prices and increased competition with the U.S.

Jane Fox : 1/29/2007 12:19:34 PM

... that coming from a 5'4" person sounds really silly.

Jeff Bailey : 1/29/2007 12:19:04 PM

January Consumer Confidence Seen Up

DJ- Economists look for consumer confidence as measured by the Conference Board to have increased a bit further in January. Economists expect a reading of 110.0 in January, up from the 109.0 in December.

Jane Fox : 1/29/2007 12:18:56 PM

VIX to new daily lows and AD volume to new daily highs. Hopefully you are not short.

Jane Fox : 1/29/2007 12:18:22 PM

NEW YORK (MarketWatch) -- Employers Holdings fattened its initial public offering by $55 million Monday, expanding the size of the IPO in a sign of healthy demand as the workmans compensation specialist readies its stock-market debut for later this week.

The Reno, Nev.-based company said in a filing with regulators it'll now offer 26.75 million shares, up from 23 million shares previously. The estimated price range remained at $14 to $16 a share.

Under the new deal terms, the IPO will raise about $400 million, up from previously forecast proceeds of $345 million. Morgan Stanley (MAS) is lead underwriter on the IPO, with Cochran Caronia Waller, Fox-Pitt Kelton and Keefe Bruyette & Woods serving on the banking team.

Currently operating as EIG Mutual Holding Co., the firm will change its name to Employers Holdings when it goes public.

Jeff Bailey : 1/29/2007 12:17:58 PM


DJ- Synagro Technologies agrees to be acquired by Carlyle Group for $462 million and assumption of $310 million in debt. Deal values Synagro shares at $5.76 each, a nearly 29% premium to Friday's close.

SYGR $5.75 +28.34% ...

Jeff Bailey : 1/29/2007 12:16:17 PM


DJ- Sysco's fiscal 2Q net climbs to $236.7 million, or 38c, boosted by business reviews and marketing efforts. Sales increase to $8.57 billion. Analysts had expected earnings of 38c a share on revenue of $8.6 billion.

SYY $34.59 -4.18% ...

Jeff Bailey : 1/29/2007 12:15:06 PM

International Paper (IP) $33.26 +1.27% ...

Jeff Bailey : 1/29/2007 12:14:31 PM


DJ- Abitibi-Consolidated and Bowater are combining to create North American powerhouse better able to compete in global forest- and paper-product market. Merger of equals is expected to close in 3Q.

ABY $3.27 +23.86% ...

BOW $26.84 +21.17% ...

Jeff Bailey : 1/29/2007 12:12:21 PM


DJ- Shares of Bristol-Myers Squibb (BMY) rise 5% after a newsletter report that the French pharmaceutical giant Sanofi Aventis and Bristol-Myers have signed a pre-merger memorandum.

Jeff Bailey : 1/29/2007 12:11:21 PM


DJ- Airline association forecasts revenue growth in worldwide airline industry to decrease by almost half from 2006 on slowing traffic and economy. Group sees 2006 loss of $500 million for airlines worldwide, despite operating profit of $10.2 billion.

AMEX Airline Index (XAL.X) 60.46 +2.26% ...

Jeff Bailey : 1/29/2007 12:09:39 PM


DJ- Drug maker posts net income of $204 million, or 12c a share, which includes 5c in charges. Analysts expected EPS of 17c. Sales rise 14% to $2.7 billion. Meanwhile, CFO says R&D spending will outpace adjusted sales in 2007.

SGP $24.83 -1.03% ...

Jeff Bailey : 1/29/2007 12:08:34 PM


DJ- Tesoro shares rise 6% as the firm will acquire Shell's Los Angeles refinery and some 250 retail sites for $1.63 billion in move to enhance its position as leading West Coast refiner. Tesoro also buying 140 stations from USA Petroleum for $277 million.

TSO $78.38 +6.17% ...

Jeff Bailey : 1/29/2007 12:07:21 PM


DJ- Merrill Lynch agrees to buy private-banking and wealth-management firm for $1.8 billion as it moves to bolster its retail-brokerage business. The $55 cash-and-stock bid is a 44% premium to First Republic's Friday closing price.

FRC $53.67 +40.13% ...

MER $93.38 -1.21% ...

Jeff Bailey : 1/29/2007 12:05:46 PM


DJ- Telecommunications giant's 4Q net income falls 38% amid charges to $1.03 billion, or 35c a share. Excluding items, earnings are 62c. Revenue rises 26% to $22.6 billion. Analysts expected earnings, excluding items, of 61c a share and revenue of $22.99 billion. Wireless business adds 2.3 million subscribers as it continues to attract more stable long-term customers. Verizon boosts 2007 cost-savings target on MCI acquisition to $900 million.

VZ $37.86 +0.07% ...

Jane Fox : 1/29/2007 12:05:16 PM

TICKS +1000. Did you all get long?

Jane Fox : 1/29/2007 12:05:00 PM

TICKs +800.

Jeff Bailey : 1/29/2007 12:02:48 PM

Chicago Fed Index: Midwest Mfg. Index Up 0.6% Dec. Vs Nov

Up 1.8% Dec Vs Year Ago

Regional Auto Output +1.7% Dec Vs Nov

Jane Fox : 1/29/2007 11:59:54 AM

I think this little dip is a good place to get long with a stop just under the last swing low. (Pick any market but ER seems to be the most bullish today).

Jeff Bailey : 1/29/2007 11:56:48 AM

DJ- Hot Stock ... Tyson Foods Inc. (TSN, $17.30 +3.65%) first-quarter earnings rose 46%, boosted by higher profits in its chicken, pork and prepared foods units, and cost-cutting efforts that lowered expenses. The Springdale, Ark., meat processor reported first-quarter earnings of $57 million, or 16 cents a share, up from $39 million, or 11 cents a share, a year earlier. Tyson said sales for the quarter ended Dec. 30 rose 1.6% to $6.56 billion from $6.45 billion a year ago. Analysts surveyed by Thomson Financial expected, on average, earnings of 6 cents a share on revenue of $6.38 billion. In addition, Tyson affirmed its earlier earnings outlook for its 2007 fiscal year, saying it expects earnings of 50 cents to 80 cents a share. The company also said it expects its second quarter to be profitable.

Jeff Bailey : 1/29/2007 11:55:07 AM

Stock Buyback... DJ- Sturm, Ruger & Co. (RGR, $10.87 +8.7%) shares gained after the Southport, Conn.-based maker of firearms and steel investment castings said it has authorized a repurchase program of up to $20 million of its common stock.

Jeff Bailey : 1/29/2007 11:53:40 AM

Merger Activity ... DJ- Premier Community Bankshares Inc.'s (PREM, $33.05 +63.61%) shares soared after the Winchester, Va.-based bank said it has agreed to be acquired by United Bankshares Inc. (UBSI) $35.76 -1.40%. Premier shareholders will be able to elect to receive either United Bankshares stock, cash, or a combination. The stock consideration will be at a fixed exchange ratio of 0.93 shares of United common stock for each share of Premier common stock, and the cash consideration will be $34 a share. Premier had $900.7 million in assets at Dec.31, 2006, and 26 offices through three banking subsidiaries.

Jeff Bailey : 1/29/2007 11:50:57 AM

DJ- Hot Stock ... Countrywide Financial Corp. (CFC, $43.81 +4.30%) shares extended a recent rally following a report in U.K. newspaper The Financial Times that the company has held talks about an alliance or merger with Bank of America (BAC) $51.56 -0.92%.

Jeff Bailey : 1/29/2007 11:48:22 AM

DJ- Hot Stock ... Mattel Inc. (MAT, $24.17, $0.21, 0.85%) reported fourth-quarter net income of $286.4 million, or 75 cents a share, up from $279.2 million, or 69 cents, earned in the final three months of 2005. Average shares outstanding were 384 million in the latest quarter, down from 402.5 million a year earlier. Quarterly sales for the El Segundo, Calif.-based toy maker reached $2.11 billion, up 14% from the prior year's $1.84 billion; currency contributed two percentage points to the growth rate. Worldwide gross sales for the company's Barbie doll brand were up 3%, Mattel said. Operating income for the latest quarter came to $388.7 million, up 21%. Analysts, on average, had been looking for Mattel to earn 67 cents a share on revenue of nearly $1.99 billion, according to estimates compiled by Thomson Financial.

Jeff Bailey : 1/29/2007 11:41:43 AM

Notable 52-week Lows at NASDAQ ... RAMS, CWTR, WAVE, PZZA, TWTR

Jeff Bailey : 1/29/2007 11:39:53 AM


Jeff Bailey : 1/29/2007 11:32:22 AM

Notable 52-week Lows at NYSE ... GFI

Jeff Bailey : 1/29/2007 11:31:18 AM

Notable 52-week Highs at NYSE ... AKS, ATI, AEP, BMY, CM, CPC, DF, DB, ENR, FIA, HCP, ESI, IJJ $81.06 +0.75%, KR, MAT, MM, NRG, NAV, PCL, RGR, SVU, TSO, TXI, TSN, WY

Jeff Bailey : 1/29/2007 11:11:19 AM

11:00 Internals found at this Link

Note: Should NASDAQ's current 5-day NH/NL ratio hold a 70.00% measure, it would reverse back up 3-boxes into a column of "X."

Tab Gilles : 1/29/2007 11:09:18 AM

Home Depot (HD)AG Edwards Issues BUY

Anticipate trough of housing activity will take place in current quarter or early 2nd quarter 2007.

Believes a shifting policy by central bank to an easing bias is typically viewed as a positive for the home improvement industry - over the last four easing cycles, home improvement retailers have seen an average share price appreciation of 37.0% in the first six months after initial rate cut.

AG Edwards; Price Objective of $46.

Earnings eps est. '07 $2.84; '08 $3.00; '09 $3.40

Positive outlook on HD centers on several fronts: (1) outlook for improving housing turnover/industry sales, (2) easing investor sentiment regarding prior CEO's corporate governance, (3) recognition of stable cash flow and EPS growth, and, (4) low valuation.

Jeff Bailey : 1/29/2007 11:02:15 AM

11:00 Market Watch found at this Link

Jeff Bailey : 1/29/2007 10:53:08 AM

British Airways Says Pension Issue Resolved

DJ- An agreement between British Airways PLC (BAB) and the Transport & General Workers Union, announced earlier Monday as part of a deal averting strike action, includes agreement on the airline's pension plans, union and airline officials said Monday.

The deal clears the way for BA to push through its pension deal and move forward with investment plans, such as a decision on renewing its long-haul fleet.

The news that the planned strike by cabin crew over pay and conditions had been averted sent BA shares higher. At 1506 GMT, the stock was up 17.5 pence, or 3.3%, at 545 pence outperforming an overall London market that was higher.

In an earlier statement, BA and the T&G said a dispute over pay rates and sickness leave had been settled and planned strikes this week and next month by cabin crew have been called off.

Thousands of cabin crew were due to walk out for 48 hours from Tuesday morning with two additional 72-hour stoppages scheduled for next month. BA is still set to suffer disruption this week because it had already canceled flights in anticipation of the first strike.

Speaking to press later, BA Chief Executive Willie Walsh and T&G General Secretary Tony Woodley said the deal also included backing for BA's plans to close its massive pensions deficit.

To help close the whopping GBP2.1 billion deficit BA has proposed a number a changes to its main pension scheme. These include raising retirement ages and capping future pension pay increases in return for a GBP800 million lump-sum injection by the company into the scheme.

BAB $106.17 +2.36% ...

Jeff Bailey : 1/29/2007 10:48:05 AM

Home Depot (HD) upped to "buy" from "hold" at AG Edwards.

HD $40.15 +0.52% ...

Jeff Bailey : 1/29/2007 10:44:24 AM

Dallas Fed Jan Mfg Production Index 13.8 Vs Dec -5.2

Dallas Fed Jan Business Activity 4.7 Vs Dec -8.8

DJ- Manufacturing activity in the Federal Reserve Bank of Dallas district grew in January.

The bank said Monday that its production index moved to 13.8 from -5.2 in December. The bank's general activity index stood at 4.7 from -8.8 in the final month of 2006.

Readings above zero indicate positive activity, and the higher the number, the more broad-based the gains.

Inflation pressures faced by manufacturers in the district continued to grow. The bank reported that its index of prices paid for raw materials moved to 30.8 in January from 19.0 the month before. Meanwhile, the prices received index hit 1.5 versus 1.7 in December.

Hiring in the Dallas Fed district expanded, with the employment index at 4.6 from the flat reading a month ago.

Manufacturing in the Dallas Fed district represents a notable portion of total U.S. output and is concentrated in energy production and electronic goods.

Jane Fox : 1/29/2007 10:42:22 AM

... and the VIX to new daily lows.

Jane Fox : 1/29/2007 10:42:12 AM

Funny thing though AD volume did not make a new daily high. Opps there it goes.

Jane Fox : 1/29/2007 10:41:08 AM

Rescue team has arrived. TICKs +1000

Jane Fox : 1/29/2007 10:31:14 AM

Internals are turning but still bullish.

Jeff Bailey : 1/29/2007 10:15:46 AM

Current OPEN MM Profiles that I've made and Watch List found at this Link

Keene Little : 1/29/2007 10:11:59 AM

I've got an early Dr.'s appointment to check out my ear (lost some hearing after getting bopped on the head while moving stuff in storage). So hopefully it won't take long. Be back in a few.

Jane Fox : 1/29/2007 10:08:09 AM

All markets now to new daily highs.

Jane Fox : 1/29/2007 10:04:45 AM

Will the small caps drag their larger brethren upwards or will the larger brothers drag the small guy down.

Jane Fox : 1/29/2007 10:03:47 AM

ER makes a new daily high but the large caps do not.

Jane Fox : 1/29/2007 10:03:04 AM

HOUSTON (MarketWatch) -- After years of enjoying growth so stellar that even Republicans once considered reining in its profits, Big Oil's seemingly unstoppable run of quarter-over-quarter success is set to end this week when the industry's biggest names report their earnings.

Beset by higher exploration costs, sharply lower commodity prices, weaker refining margins, and rising taxes and royalties, former earnings gushers are expected to report fourth-quarter results fell from both the year-ago and previous quarter.

On Thursday, analysts expect industry titan Exxon Mobil Corp. (XOM) to report earnings of $1.51 per share on revenue of $100 billion, a drop off of 9% from the year-ago quarter and almost 16% from the third quarter, according to Thomson Financial.

On Friday, Chevron Corp. (CVX), the nation's No.2 oil company behind Exxon, is expected to see earnings decline 7% to $1.73 per share on revenue of $68.6 billion.

Earlier this year, as oil prices raced to almost $80 a barrel and gasoline prices shot above $3 a gallon, consumer outcry against the oil industry reached such a pitch that calls to increase scrutiny on the industry's practices and even impose a windfall tax were embraced on both sides of the political aisle in Washington.

Jeff Bailey : 1/29/2007 10:02:19 AM

10:00 Market Watch found at this Link

Jane Fox : 1/29/2007 10:00:51 AM

* Dow industrials advancers outnumber decliners 20 to 10
* NYSE advancers outnumber decliners 19 to 10
* Nasdaq advancers outnumber decliners 14 to 12

Keene Little : 1/29/2007 10:00:27 AM

The brokers are still sinking lower this morning.

Jane Fox : 1/29/2007 9:59:57 AM

ER (the small caps) is the only market to break its PDH so far. Link

Jane Fox : 1/29/2007 9:50:14 AM

When the VIX and the AD volume look like this you know you do not want to be short. The TRIN is not cooperating again today but trading at 1.00 means you don't have to worry too much about it. Link

Jane Fox : 1/29/2007 9:47:20 AM

All markets have broken their respective overnight highs.

Jane Fox : 1/29/2007 9:45:49 AM

AD line is now +512 and AD volume making new daily highs. And since the VIX is making new daily lows, the internals are telling you the bulls have grabbed the ball and are running with it. They do not have great field position yet but with the momemtum I am seeing that could be easily attained.

Keene Little : 1/29/2007 9:44:55 AM

The brokers (XBD) and the banks (BIX) both remain in the red this morning.

Keene Little : 1/29/2007 9:43:24 AM

Indices are getting a nice spike up but I noticed Mother MER is not joining the party. In fact the stock gapped down more than a dollar. Hard to trust this early move.

Jane Fox : 1/29/2007 9:41:36 AM

TICKs +800.

Jane Fox : 1/29/2007 9:41:24 AM

VIX opens within its PDR but is making new daily lows giving the markets an upward push.

Jane Fox : 1/29/2007 9:40:14 AM

Ad line is a neutral -137 and AD volume above 0 but barely. No one has the ball this morning.

Jeff Bailey : 1/29/2007 9:20:15 AM

Prior 3 Weekly Pivot Matrix found at this Link ...

Jeff Bailey : 1/29/2007 9:15:41 AM

Weekly/Monthly Index Pivot Matrix found at this Link

Keene Little : 1/29/2007 9:04:18 AM

Equity and bonds have had a slight positive bias since the overnight lows so we'll see if that gives us an early rise after the open. It could be a consolidation type day today though so I'll be watching for crisp setups before jumping in. Give it the first hour to see what shakes out. I has mentioned below that we could see a pullback today that leads to another leg up into Wednesday. With the FOMC meeting on Wednesday we might see a small market rally into that.

Jane Fox : 1/29/2007 9:02:10 AM

I will remain neutral on Gold until I see these charts tell me otherwise. Link

Jane Fox : 1/29/2007 9:35:32 AM

Crude retraced most of its Friday's rally, which should have given Gold a boost but as you can see it did not. Overnight Gold almost tested its PDL all while the $ has traded sideways. Obviously intermarket relationships were not working overnight. Link

Jane Fox : 1/29/2007 8:54:28 AM

It was a totally uneventful overnight session giving little clues as to intraday direction other than to say it could be a tough one to trade. Link

Jane Fox : 1/29/2007 8:48:20 AM

FLORENCE (MarketWatch) -- Global hydrocarbon reserves will last at least 100 years, although they will become increasingly more difficult to access, GE Oil & Gas Chief Executive Claudi Santiago said Monday.

"Oil and gas reserves are out there," Santiago said at the GE Oil & Gas annual meeting, which runs until Tuesday. "The issue is that it is increasingly difficult" to extract.

GE Oil & Gas is owned by General Electric Co. (GE). ,p> Santiago said he expects oil prices to remain high in coming years. He said crude isn't seen falling to less than $50 a barrel over the next five years.

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