CNBC's Domm: Today's Agenda in the Markets
Stocks will take their direction from economic data today after yesterday's drenching from negative April chain store sales took the Dow down 147 points and bit 1.7% off the Nasdaq and 1.4% off the S&P 500. European markets are lower, following overnight weakness in Asian markets.
The focus today will be key data points of retail sales and producer prices. The April retail sales number should shed light on the strength of the consumer, and the inflation gauge on producer prices. All day today, we will look at how the consumer is doing and whether this pillar of the U.S. economy will keep on going.
Meanwhile, Former Fed Chairman Alan Greenspan today repeated that he believes there's a one third chance of a U.S. recession, a comment he first made in March and no surprise to markets. The Wall Street Journal's WSJ.com forecasting survey this week showed economists by a more than five-to-one margin that they believe the first quarter's limp growth marks the low point in the current slowdown. They expect growth to stay below 3% into early 2008, and that 2007 will have the slowest growth since 2002.
Oil prices are on the rise this morning as another supply disruption in Africa unsettled global oil markets. A fire at Total's Nkossa offshore platform in Congo Republic killed two people and halted 60,000 barrels of production at the field. About 25% of production in Nigeria is already offline.
China's high-flying stock market finally paused today and traded a bit lower as China reported a greater-than-expected rebound in its trade surplus to $16.87 billion from $6.9 billion in March. China's Regulatory Commission, meanwhile, said on its Web site that Chinese commercial banks will be now able to buy stocks in foreign markets, a move that could take some pressure off the funds flooding local markets, according to Bloomberg.
Along Wall Street
When analysts move in a group, it can be ugly. Analysts at Citigroup, JP Morgan, Morgan Stanley and Lazard Freres this morning are slashing their ratings on Amgen . Yesterday, an FDA panel of experts said a group of anemia drugs widely used by cancer patients should be further restricted on concerns they are used too aggressively and could be harmful. The panel encouraged more study of Amgen's Aranesp and Eposgen and Johnson and Johnson's Procrit.
Comment on Wall Street
Some couples have no secrets between them, and some have other people's and then trade on them, or so the Justice Department says. A former analyst at Morgan Stanley and her husband, a former hedge fund analyst at ING were arrested yesterday, the same day a former Morgan Stanley rules compliance officer and her husband were pleading guilty in Manhattan in separate insider trading cases. The latest insider trading arrests highlight a big difference between now and the Gordon Gecko era as we watch a flurry of new cases. In Gordon's days, those arrested on Wall Street were the masters of the universe and those associated with them. Now, it could be your next door neighbors.