The S&P 500 is on track for its best weekly gain since July, but if history is any indication, those gains may evaporate on Monday.» Read More
As Jane Wells pointed out Friday morning, orange juice seems to be getting squeezed when compared to the other headline agricultural commodities.
In fact, frozen OJ is down 23% year to date. Supplies are up and demand is down. Not a good recipe for futures. (Video: Jane Wells on OJ futures)
Here are some of these commodities, sorted from worst to best on a YTD basis.
With today's hearings in Washington on the JP Morgan Chase buyout of Bear Stearns , here is a look at how the Financials and Home Builders have faired since their close the Friday before the deal was announced. An all-star cast will be testifying, including Fed Chairman Bernanke, SEC Chairman Cox, JP Morgan CEO Jamie Dimon, and Bear Stearns CEO Alan Schwartz.
While Countrywide is the biggest winner since mid-March, it is the home builders that are soaring YTD.
RESEARCH IN MOTION (RIMM)
Makes THE device business people use to communicate when they're not in front of a computer.
Beloved product + Lack of competition + Heady subscription fees = $66 BILLION market cap.
Reports Q4 earnings Wednesday 4/2 at about 405p ET - 415p ET. Conference call at 5p ET.
As the second quarter begins, and uncertainty in the U.S. market prevails, investors might want to start looking south for some opportunities. For the first quarter, Latin American indices were amongst the best performers around the globe. Earlier this week on Power Lunch, Joyce Chang, Global Head of Emerging Markets Research at JPMorgan, highlighted that emerging markets remain a defensive play especially in Latin America and emerging Asia. If the theory of decoupling holds true, emerging markets could enjoy continued growth despite a slowdown in the United States economy.
With the ISM Numbers coming out today, this will be the first major economic indicator of the second quarter. The previous reading came in at 48.3 and consensus was for further contraction. Today's reading, just in, came in at 48.6 and is better than expected. A reading of 50 or more indicates an expanding economy while a reading under 50 reflects contraction. The chart below shows the index for the past 30 years. Grey bands represent recessions. Note we are far from the lows of the past recessions.
The US Markets end this volatile quarter on a rally. The Nasdaq broke a 4 month-losing streak.
The Dow , S&P and Nasdaq are just points away from breaking their monthly losing streaks at 4 straight months of losses. Here's what they would need to rally today to have their first positive month since October:
Longest losing streaks:
The last time the Dow and Nasdaq had 5 consecutive months of losses was in 2002 (6 month streaks from April to Sept). The last time the S&P 500 has 5 months in a row of losses was 1990 (5 month streak June through Oct).
Amongst the biggest gainers on the S&P on the open are:
Amongst the biggest gainers on the Dow on the open are:
Amongst the biggest gainers on the Nasdaq on the open are:
For the week ending Friday, March 28, 2008 the US Marketsended mixed after starting on a high note Monday extendinglast week's market rally. The winning streak came to anend on Tuesday when the Dow closing down for the first timein three sessions. The NASDAQ had the strongestperformance of the week managing a positive gain despite weakearnings from Oracle and poor performance from Google . Economic data dragged on the markets with consumer sentimentand confidence at low levels and negative housing data.
-Next week the markets will watchFriday's jobs reportfor evidence ofrecession, and any revisions on guidance as we move intoearnings season. Alcoa kicks off "official" earnings season on Monday,April 7th after the bell. The big companiesfor next week all hit on Wednesday with RIM , Monsanto andBest Buyall reporting earnings.
- Altria officially split its US and International businesseson Friday, forming two units that will begin trading onMonday. Altria (MO) for the US operations, and Philip MorrisInternational, with new ticker PM for the non-USholdings. Shareholders will receive oneshare of Philip Morris International for every Altria sharethey own.
-Personal Incomerose more than expected inFebruary to 0.5%. Personal Spendingrose slightly in Februaryto an anemic level of 0.1% showing an increasedtightening of the consumer wallet.
**The overall PCE Indexslowed to 0.1% showingtame inflation, after a 0.3% increase in January. The CorePCE also slowed to a 0.1% rise in February after a 0.2%increment the previous month.
-Consumer Sentiment for March declinedto 69.5from 70.8 in February, far below economist expectations of 70bringing in the weakest reading since 1992. These lowscan only be compared to prior recessionary periods.
-Consumer Confidencesank in March to 64.5,far below economist’s expectations for a reading of 73hitting the lowest levels since 2003 for the presentsituation, and the expectations component hit a new 35-yearlow over rising inflation and job worries.
- Initial jobless claims showed a slightimprovementwith claims falling by 9,000 to 366,000for the week of March 22, but remained at elevated levelsconsistent with sluggish labor markets.
-Gross Domestic Product (GDP)- Final was unrevised ata 0.6%annual rate in 4th Quarter 2007, but stillmuch lower than 3rd Quarter 2007 growth of 4.9%. Themarkets are looking towards Q1 GDP especially after theChicago Fed data pointed towards lower 1st qtr growth andrecession Friday.
- US Durable Orders fell by -1.7%in Februaryand economists had forecasted a slight rise of 0.8%, showinga decline for a second straight month Weakness in Februaryorders was mainly due to a sharp decline in machinery whichis at an all-time low.
Housing and Mortgages:
-Existing Home Salesin Februarywere better than expected increasing2.9%with the first increase since July 2007in contrast to New Home Sales which were worse thanexpectedin February falling -1.8% to the lowest markin 13 years.
**The median price for a new home decreased by –2.7%year-over-year to $244,100 in February. The average price fornew home decreased by -7.8% to $296,400 from $321,500 a yearearlier.
- The S&P/Case Shiller Home Price Indexreflected weak housing prices declining -2.3% in January andan -11.4% drop from a year ago, the steepest dropsince S&P started collecting data in 1987.
-Lennar Corp. , one of largest homebuilders posted a Q1 loss,but the loss was better than expected. KB Home alsoreported a loss this week compared to a profit a yearearlier, and lost almost 5% on the news.
Sectors & Stocks:
- JP Morgan raised its bid for Bear Stearns to $10per share from $2 per share fueled by investor outrage.
-Fortress Investment Group beat analyst expectations andreaffirmed its commitment to acquire Penn National Gaming for$6.1 billion.
Technology: (Watch for earnings onResearch in Motion (RIMM) next week)
- Clear Channel Communications reported that the $19 billionacquisition deal with private-equity firms Thomas H. Lee andBain Capital Partners was in jeopardy due to the credit termsplaced by the investment banks that agreed to financial thedeal. CCU fell sharply ending the week down almost 17%.
-The US. Department of Justice approved the proposed $4.22billion merger between Sirius Satellite Radio and XMSatellite Radio , however the deal still requires theapproval of the Federal Communications Commission (FCC).
**Both (SIRI) and (XMSR) finished down 1.72% and 0.92%respectively for the week.
- Take-Two Interactive Software rejected the Electronic Arts$26 per share bid considering the deal“inadequate”. Electronic Arts extended its$2B tender offer by a week if Take-Two pulls its poisonpill. TTWO also adopted a 180-day“poison-pill” to thwarts a hostile takeoverattempt by ERTS.
-Google sufferedas fears grew that thecompany may miss its Q1 revenue targets, and UBS slashed itsprice target amongst a decline of 3% in the number of paid adclicks reported by Comscore.
*Google has plummeted almost 37% year todate. Google closed out 2007 at aprice of $691.48, and ended Friday down $253.40 at aclose of $438.08
- Motorola announced it would split into twoseparate public entities to separate its loss-makingmobile-device division from its other businesses.
-Oracle disappoints with weak Q3 revenueon"cautious" customer behavior. ORCL shares finished the weekdown 14.13%.
Retailers pulled down the Consumer DiscretionarySector, ending the week off almost 3% for the second worstperformance with Financials bringing up the rear.
-JC Penney cut its Q1 earnings outlook due toEaster sales "well below expectations." and plunged 7.5%Friday also pointing to an increasingly tight-fistedconsumer.
*Downgradeswere seen by Tiffany, Blue Nile, Kohl's all shedding more than 4% on Friday.
-ConAgra (CAG)blows out Q3 earnings estimatesand announced it will sell its highly profitable commoditiestrading group for $2.1 billion fearing increased risk andvolatility in the markets.
**The CME raised its daily price limits on corn andsoybean futures
-Wheatandsoyend the week down sharply on Friday withmonth-end profit taking and expectations ofMonday's USDA plantings report. Cornended up as wet and cool weatherthreaten the spring seedlings.
**Rough Rice continues to be the stand out up 9.09%this week and almost 42% this yearand first quarterto date.
**Monsantoboosted its outlook for 2008 on seedsales and gains in its herbicide business. Monsantogained almost 18% for the week.
-Crude Oil for May deliveryended the week at$105.62 per barrel, off its highs over $108 per barrel afterreported sabotage of an Iraqi export pipeline.
*Retail Gas prices maintain record levelswiththe EIA average at $3.259 per gallon as of 3/24, the LundbergSurvey rose to $3.26 per gallon on average as of 3/21, andAAA saw an increase to $3.261 per gallon. AAA reporteda high of $3.285 per gallon as of 3/16.
- Gold for April delivery is –7.3% off itsrecord close of $1004.3 set on 3/18/08, but up 1.15% for theweek settling at $930.6 an ounceon Friday.
Currencies:The Dollar held firm and did not hit any new lowsthis week against the euro, yen or pound after personalincome and spending numbers and inflation data came in asexpected.
- The US dollar lost only -0.31% against the yen forthe week, it lost 1.68% against the euro and lost -0.56%against the British pound.
Market Stats:The Dow ended down -144.92 or -1.17% for theweek and negative on Friday
-The Dow is Negative YTD down -7.90%
-The Dow is off by -1,948.13 or -13.75% from the market peakon October 9th of 14,164.53
The NASDAQ ended up 3.07 or 0.14% for the week and negativeon Friday
-The NASDAQ is Negative YTD down -14.75%
-The NASDAQ is off by -597.94 or -20.91% from the market peakon October 31 of 2,859.12
The S&P 500 ended down -14.29 or -1.07% for the weekand negative on Friday
-The S&P is Negative YTD down -10.43%
-The S&P is off by -249.93 or -15.97% from themarket peak on October 9th of 1,565.15
S&P Sector Performance for the week endingThursday, March 28, 2008:
S&P 500 Materials Sector(.GSPM) Up 11.14 or 4.65%
S&P 500 Energy Sector (.GSPE) Up15.36 or 2.84%
S&P 500 Consumer Staples Sector (.GSPS) Up2.47 or 0.86%
S&P 500 Telecomm Services Sector(.GSPTS) Up 1.19 or 0.85%
S&P 500 Industrials Sector(.GSPI) Up 0.24 or 0.07%
S&P 500 Utilities Sector(.GSPU) Down -0.30 or -0.16%
S&P 500 Health Care Sector(.GSPHC) Down -1.61 or -0.44%
S&P 500 Information Technology Sector(.GSPT) Down -3.79 or -1.08%
S&P 500 Consumer Discretionary Sector (.GSPD) Down-7.39 or -2.99%
S&P 500 Financials Sector(.GSPF) Down -24.76 or -6.95%
S&P Top 10 Performers for the week endingThursday, March 28, 2008:
The Bear Stearns Companies Inc(BSC) Up 4.82 or 80.87%
CIT Group Inc (CIT) Up 1.97 or20.46%
Monsanto Co (MON) Up 17.17 or17.68%
BJ Services Co (BJS) Up 4.17 or17.22%
Broadcom Corporation (BRCM) Up 2.12 or12.52%
Weatherford International Inc (WFT) Up 7.52or 11.82%
Freeport-McMoRan Copper & Gold Inc(FCX) Up 9.52 or 10.93%
Apache Corp (APA) Up 11.30 or10.49%
National Oilwell Varco Inc (NOV) Up5.26 or 10.22%
Nabors Industries Ltd (NBR) Up 3.02 or9.94%
S&P 10 Worst Performers for the week endingThursday, March 28, 2008:
Apollo Group Inc(APOL) Down -17.55 or -29.87%
Fannie Mae (FNM) Down -8.28 or-24.14%
MGIC Investment Corp (MTG) Down -3.02or -23.12%
Lehman Brothers Holdings Inc (LEH) Down-10.78 or -22.16%
Freddie Mac (FRE) Down -7.13 or-21.88%
Jabil Circuit Inc (JBL) Down-2.37 or -20.47%
Clear Channel Communications Inc (CCU) Down -5.44or -15.70%
Wachovia Corp (WB) Down -4.73 or-15.40%
Merrill Lynch & Co Inc(MER) Down -6.92 or -14.77%
First Horizon National Corp (FHN) Down -2.42or -14.09%
Dow Top Performers for the week ending Thursday,March 28, 2008:
Caterpillar Inc(CAT) Up 3.27 or 4.43%
ALCOA Inc (AA) Up 1.43 or4.12%
Merck & Co Inc (MRK) Up1.15 or 2.65%
AT&T Inc (T) Up0.81 or 2.20%
E I du Pont de Nemours and Co (DD) Up 0.99or 2.18%
McDonald's Corporation (MCD) Up 1.06or 1.95%
Chevron Corp (CVX) Up 1.29 or1.55%
Exxon Mobil Corp (XOM) Up 0.22or 0.26%
Procter & Gamble Co (PG) Up0.07 or 0.10%
3M Company (MMM) Down -0.03or-0.04%
Dow Worst Performers for the week ending Thursday,March 28, 2008:
Bank Of America Corp(BAC) Down -3.79 or -9.05%
Citigroup Inc (C) Down-1.67 or -7.42%
JPMorgan Chase and Co (JPM) Down -3.26or -7.09%
American Express Co (AXP) Down -2.83or -6.15%
American International Group Inc (AIG) Down-2.21 or -4.91%
Intel Corp (INTC) Down-0.96 or -4.41%
Microsoft Corp (MSFT) Down -1.27or -4.35%
General Motors Corp (GM) Down -0.83 or-4.26%
International Business Machines Corp (IBM) Down-3.76 or -3.18%
The Walt Disney Co (DIS) Down -0.90 or-2.82%
Key Earnings next week:
Monday: Pacific Ethanol (PEIX)
Wednesday: Best Buy (BBY), Carmax (KMX), Monsanto (MON),Research in Motion (RIMM)
Thursday: Constellation Brands (STX), RPM International (RPM)
Friday: Family Dollar (FDO), Mosaic (MOS)
Economic Data next week:
Monday: Chigago PMI
Tuesday: Construction Spending, ISM Manufacturing Index
Wednesday: ADP Employment, Factory Orders, EIA PetroleumStatus Report
Thursday: Jobless Claims, ISM Non-Manufacturing Services, EIANatural Gas Report
Friday: Jobs Report: Nonfarm Payrolls, Unemployment Rate,Hourly Earnings, Average Workweek
The major U.S. indexes were a mixed bag this week, all close to flat, commodities halt their record setting pace, and the US dollar manages to hold its ground against most major currencies.
The S&P 500 sectors were mixed for the week, Materials, Energy, Telecom, Consumer Staples and Industrials ending the week positive. For the year and the quarter \(currently the same number\), all sectors are negative with Information Technology pulling in the worst numbers with a decline of -15.94%.
Today's numbers on personal income and outlays shows more tightening of the consumer wallet, the leading component of the US economy. Consumer spending, which represents ~70% of GDP, hit a 17-month low in February. On an annualized basis, consumer spending has been growing at over 5% per year for the past 10 years while disposable income has grown less than 5% per year. The chart below shows the average annual personal consumption numbers broken out by its three components.