Best of the Week
Most Popular
1. Gold vs Cash in a Financial Crisis - Richard_Mills
2.Current Stock Market Rally Similarities To 1999 - Chris_Vermeulen
3.America See You On The Dark Side Of The Moon - Part2 - James_Quinn
4.Stock Market Trend Forecast Outlook for 2020 - Nadeem_Walayat
5.Who Said Stock Market Traders and Investor are Emotional Right Now? - Chris_Vermeulen
6.Gold Upswing and Lessons from Gold Tops - P_Radomski_CFA
7.Economic Tribulation is Coming, and Here is Why - Michael_Pento
8.What to Expect in Our Next Recession/Depression? - Raymond_Matison
9.The Fed Celebrates While Americans Drown in Financial Despair - John_Mauldin
10.Hi-yo Silver Away! - Richard_Mills
Last 7 days
UK Coronavirus Infections and Deaths Projections Trend Forecast - Video - 28th Mar 20
The Great Coronavirus Depression - Things Are Going to Change. Here’s What We Should Do - 28th Mar 20
One of the Biggest Stock Market Short Covering Rallies in History May Be Imminent - 28th Mar 20
The Fed, the Coronavirus and Investing - 28th Mar 20
Women’s Fashion Trends in the UK this 2020 - 28th Mar 20
The Last Minsky Financial Snowflake Has Fallen – What Now? - 28th Mar 20
UK Coronavirus Infections and Deaths Projections Trend Forecast Into End April 2020 - 28th Mar 20
DJIA Coronavirus Stock Market Technical Trend Analysis - 27th Mar 20
US and UK Case Fatality Rate Forecast for End April 2020 - 27th Mar 20
US Stock Market Upswing Meets Employment Data - 27th Mar 20
Will the Fed Going Nuclear Help the Economy and Gold? - 27th Mar 20
What you need to know about the impact of inflation - 27th Mar 20
CoronaVirus Herd Immunity, Flattening the Curve and Case Fatality Rate Analysis - 27th Mar 20
NHS Hospitals Before Coronavirus Tsunami Hits (Sheffield), STAY INDOORS FINAL WARNING! - 27th Mar 20
CoronaVirus Curve, Stock Market Crash, and Mortgage Massacre - 27th Mar 20
Finding an Expert Car Accident Lawyer - 27th Mar 20
We Are Facing a Depression, Not a Recession - 26th Mar 20
US Housing Real Estate Market Concern - 26th Mar 20
Covid-19 Pandemic Affecting Bitcoin - 26th Mar 20
Italy Coronavirus Case Fataility Rate and Infections Trend Analysis - 26th Mar 20
Why Is Online Gambling Becoming More Popular? - 26th Mar 20
Dark Pools of Capital Profiting from Coronavirus Stock Markets CRASH! - 26th Mar 20
CoronaVirus Herd Immunity and Flattening the Curve - 25th Mar 20
Coronavirus Lesson #1 for Investors: Beware Predictions of Stock Market Bottoms - 25th Mar 20
CoronaVirus Stock Market Trend Implications - 25th Mar 20
Pandemonium in Precious Metals Market as Fear Gives Way to Command Economy - 25th Mar 20
Pandemics and Gold - 25th Mar 20
UK Coronavirus Hotspots - Cities with Highest Risks of Getting Infected - 25th Mar 20
WARNING US Coronavirus Infections and Deaths Going Ballistic! - 24th Mar 20
Coronavirus Crisis - Weeks Where Decades Happen - 24th Mar 20
Industry Trends: Online Casinos & Online Slots Game Market Analysis - 24th Mar 20
Five Amazingly High-Tech Products Just on the Market that You Should Check Out - 24th Mar 20
UK Coronavirus WARNING - Infections Trend Trajectory Worse than Italy - 24th Mar 20
Rick Rule: 'A Different Phrase for Stocks Bear Market Is Sale' - 24th Mar 20
Stock Market Minor Cycle Bounce - 24th Mar 20
Gold’s century - While stocks dominated headlines, gold quietly performed - 24th Mar 20
Big Tech Is Now On The Offensive Against The Coronavirus - 24th Mar 20
Socialism at Its Finest after Fed’s Bazooka Fails - 24th Mar 20
Dark Pools of Capital Profiting from Coronavirus Stock and Financial Markets CRASH! - 23rd Mar 20
Will Trump’s Free Cash Help the Economy and Gold Market? - 23rd Mar 20
Coronavirus Clarifies Priorities - 23rd Mar 20
Could the Coronavirus Cause the Next ‘Arab Spring’? - 23rd Mar 20
Concerned About The US Real Estate Market? Us Too! - 23rd Mar 20
Gold Stocks Peak Bleak? - 22nd Mar 20
UK Supermarkets Coronavirus Panic Buying, Empty Tesco Shelves, Stock Piling, Hoarding Preppers - 22nd Mar 20
US Coronavirus Infections and Deaths Going Ballistic as Government Start to Ramp Up Testing - 21st Mar 20
Your Investment Portfolio for the Next Decade—Fix It with the “Anti-Stock” - 21st Mar 20
CORONA HOAX: This Is Almost Completely Contrived and Here’s Proof - 21st Mar 20
Gold-Silver Ratio Tops 100; Silver Headed For Sub-$10 - 21st Mar 20
Coronavirus - Don’t Ask, Don’t Test - 21st Mar 20
Napag and Napag Trading Best Petroleum & Crude Oil Company - 21st Mar 20
UK Coronavirus Infections Trend Trajectory Worse than Italy - Government PANICs! Sterling Crashes! - 20th Mar 20
UK Critical Care Nurse Cries at Empty SuperMarket Shelves, Coronavirus Panic Buying Stockpiling - 20th Mar 20
Coronavirus Is Not an Emergency. It’s a War - 20th Mar 20
Why You Should Invest in the $5 Gold Coin - 20th Mar 20
Four Key Stock Market Questions To This Coronavirus Crisis Everyone is Asking - 20th Mar 20
Gold to Silver Ratio’s Breakout – Like a Hot Knife Through Butter - 20th Mar 20
The Coronavirus Contraction - Only Cooperation Can Defeat Impending Global Crisis - 20th Mar 20
Is This What Peak Market Fear Looks Like? - 20th Mar 20
Alessandro De Dorides - Business Consultant - 20th Mar 20
Why a Second Depression is Possible but Not Likely - 20th Mar 20

Market Oracle FREE Newsletter


Stock Markets Drift Lower In A Quiet Market

Stock-Markets / Financial Markets Dec 18, 2008 - 12:00 PM GMT

By: PaddyPowerTrader

Stock-Markets Best Financial Markets Analysis ArticleIt's gone all eerily quiet in a fatigued and illiquid market as we approach end year. The Dow Jones fell 1.12% last night in another low volume day . Stocks continue to fret in the wake of the Madoff debacle. Morgan Stanley missed their earnings expectations badly yesterday and GE has even given up giving earnings guidance.

Today's Market Moving Stories

  • Incoming US President Obama said he will nominate Daniel Tarullo to an open seat on the Federal Reserve Board.
  • The UK Deputy Governor of the Bank of England said they may take rates all the way to zilch. He also mentions the new buzzword “quantitative easing” but says that this of course would have to be approved by the Treasury.
  • The UK Chancellor is set to announce another multi-billion pound package next month, aimed at getting the banks to restart lending to businesses of all sizes. Past loan schemes along these lines have covered up to 80% of the risk on each loan. But this generates further risks to the taxpayer in the event that a worsening economic outlook leads to an increase in default rates and crystallises some of the Government's contingent liabilities.
  • ECB arch hawk Axel Weber said that rates may be allowed dip below 2% (the historic post 9/11 low) as their forecasts for economic growth may be trimmed further. Their staff forecasts, though only three weeks old, look like fantasy island stuff.
  • There is some talk that the ECB may announce a cut in the rate on interest that they pay banks who lodge monies with them. They want to encourage banks to lend and get that pesky V in the old MV = nominal GDP going again. So far everything else they've tried has merely resulted in more hoarding.
  • Chrysler has announced that it is to shut all 30 of its plants from tomorrow for one month. The two desperados, GM and Chrysler, have restarted merger talks. One is reminded of the old adage that two wrongs don't make a right. In related news President Bush (yes that cretin is sadly still in office) said that he'll decide on emergency loans to automakers “relatively soon”! There's no urgency or course.
  • One can only surmise that the game is up for the majority of hedge funds and they will be faced with massive redemption calls at any given month end until they are more or less extinct in the form we knew them. This will lead to more seemingly illogical short selling.
  • Its refreshing to see that falling demand of oil still trumps the OPEC cry babies. Despite cutting production by 2.2m barrels per day, US Crude fell by 8%! Yes despite the merchants of doom predicting that we were on they way back to a three figure handle per barrel, the price actually is hovering around $40 barrel. Dire news for Putin and those simply insufferable Iranians but some Xmas cheer at the pumps for consumers and another disinflationary input.
  • Ireland is back in focus due to the weakness of sterling which is putting huge stress on already hard pressed retailers as Xmas shoppers flock across the border.

Dollar Freefall
EURUSD's uninterrupted climb back to 1.45 in jig time is just one example of the general inertia prevailing. The potential for a bit of a run on the US Dollar is beginning to worry investors, particularly those overseas. A twin deficit of 10-12% of GDP historically has spelt curtains for any currency. That said the reserve status of the Dollar has been called into question before, only for it to rebound sharply.

There isn't much “easy money to be made”. As correlations break down, sure bets like a “weak Dollar = higher commodity prices” that had worked a treat thus far this year are now losers.

Data Today
The main focus of the European morning will be the key German IFO business survey sentiment at 09.00. This is closely watched by even the ivory tower dwellers of the ECB and is on a 6 month losing streak. A further fall in the index to 84 is expected by the markets. A super weak number may put a January rate cut back on the table.

UK-wise, we have the random walk that is the retail sales number (i.e. it is very difficult to predict) at 09.30 with the street looking for a –0.6% read.

Stateside we have the weekly jobless claims (-558k expected) at 13.30; leading indicators (-0.4%) at 15.00; Philly Fed (-40.5) at 15.00 and the weekly natural gas inventories. The Fed's Fisher will also give a speech.

Equities and Earnings

  • Today sees earnings from FedEx, Pier 1, Rite Aid, Oracle, Palm and Research In Motion. For a daily list, check out the new Trader Report .
  • Nike beats expectations last night after the bell on strong overseas sales.
  • Apple's share price is under the kosh on renewed concerns about Steve Jobs health.
  • French supermarket giant Carrefour has put out a profit warning.
  • Mining giant Rio Tinto have had their credit rating cut by Moody's due to the debt burden from their Alcan acquisition.
  • Merger talks between BA and Aussie airline Quantas have been called off.

And Finally… Fred Thompson On The Bailouts
Remember irony is not something your mother used to do for you.

Disclosures = None

By The Mole

The Mole is a man in the know. I don’t trade for a living, but instead work for a well-known Irish institution, heading a desk that regularly trades over €100 million a day. I aim to provide top quality, up-to-date and relevant market news and data, so that traders can make more informed decisions”.

© 2008 Copyright PaddyPowerTrader - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

PaddyPowerTrader Archive

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules