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Market 360: The Best and Worst of the Week for US Equities, Commodities, Currencies, and More

For the short Independence week ending Friday, July 3, 2008, the U.S. Markets ended the week in bear market territory with the Dow and the NASDAQ off more than 20% from their market peak set in October, 2007. A weak employment situation, credit concerns, and surging crude oil prices all contributed to the market decline, though the Dow and the S&P were positive on Thursday.

-Next weeks Highlights: The markets will await the kick off of the "official" earnings season with Alcoa after the bell on Tuesday followed by other Dow components, General Electric and Chevron. Other market moving events include International trade, Pending Home Sales, and Consumer Sentiment.

Market Moving News:-General Motors was downgraded on Wednesday by Merrill Lynch which stated that the automobile company could be on the brink of bankruptcy, as GM faces illiquidity. GM’s shares on Wednesday sunk 15% to $9.98, a 54-year low, and are off 12.4% for the week.
*Ford is also suffering from elevated energy costs and a weakening demand for autos as shares also fell 11% for the week.
-Financials got hit by announcements of more write-downs and touched multi-year lows, but despite the negative news, they managed to have a strong week, including Lehman Brothers which ended the week up 2.7%; American Express was up almost 6%, and Goldman Sachs was up almost 2.5% for the week.
-Starbucks Corp. shed 4.8% for the week, after the company stated that it will close 600 underperforming stores due to a struggling economy, and plans further foreclosures for the rest of the year.


Market Moving News:-General Motors was downgraded on Wednesday by Merrill Lynch which stated that the automobile company could be on the brink of bankruptcy, as GM faces illiquidity. GM’s shares on Wednesday sunk 15% to $9.98, a 54-year low, and are off 12.4% for the week.
*Ford is also suffering from elevated energy costs and a weakening demand for autos as shares also fell 11% for the week.
-Financials got hit by announcements of more write-downs and touched multi-year lows, but despite the negative news, they managed to have a strong week, including Lehman Brothers which ended the week up 2.7%; American Express was up almost 6%, and Goldman Sachs was up almost 2.5% for the week.
-Starbucks Corp. shed 4.8% for the week, after the company stated that it will close 600 underperforming stores due to a struggling economy, and plans further foreclosures for the rest of the year.



M&A, Deals, Corp Actions:-Chesapeake Energy entered a joint venture with Plains and Exploration Production Co. valued at $3.3 billion, as the company will sell 20% of its Haynesville leasehold. Shares of Chesapeake jumped 4.2% for the week on deal news.
-Energy Recovery had a successful market debut on Tuesday, as the stock closed up 16% from its initial public offering price of $8.5. This industrial company focuses on desalination of salt water.
-CIT Group agreed to sell its home-lending business for ~$1.8 billion to Lone Star Funds which has been battered by increased delinquencies and charge offs, in order for the company to raise cash and strengthen its balance sheet. CIT’s shares surged ~30% on Tuesday after this positive note.
-Vodafone Group announced a partnership with News Corps’ MySpace engine to create an online global interactive platform in order to expand the company’s music activity. Vodafone’s ADR edged up 7.8% for the week on deal news.
-France Telecom stated that it will abandon merger deal with Nordic telecommunication firm TeliaSonera, previously valued around $42 billion after both companies failed to reach a financial agreement. France Telecom’s ADR traded up 15% for the week as its investors welcomed FTE’s less costly decision.

Commodities:
-Crude Oil
for August delivery surged above $145/barrel as it settled at three consecutive records from 7/01-7/03 and hit an all time high of $145.85/barrel on 7/03, led by Iran-Israel conflicts, a drop on weekly crude inventories, and a weak dollar. Crude oil has shot up more than 50% year to date, and is up 3.4% for the week.
**AAA’s fuel gauge report has announced a new record ahead in the national average price of unleaded gasoline, currently at $4.098/gallon as of 7/03 and up over 38% from a year ago.
-Heating Oil for August delivery settled at two consecutive records on 7/02 & 7/03 after it also reached a fresh all-time high of $4.135/gallon on 7/03, and moved up 4.4% for the week on disappointing inventories.
-RBOB gasoline for August delivery closed at two new records on 7/02 & 7/03 and is up 1.5% for the week.
-Copper for September delivery settled at a new record of $4.0635/lb on 7/02, supported by a 0.6% rise in U.S. factory orders, and a continued miner’s strike in Peru. Copper rose 1.8% for the week and up ~30% year to date.
-Corn for December delivery slumped 1.3% for the week, and retreated 2.4% from its all-time high of $7.96/bushel reached on 6/27/08, after government data showed surprise increase in corn acreage. **As per USDA, farmers planted 1.3 million more acres than they had expected from the USDA’s March report. Yet farmers harvested 78.9 million acres of corn or 8.7% less than previous year.
**Ethanol producing stocks such as Aventine Renewable Energy , VeraSun , and Pacific Ethanol dropped 4.0%, 6.4%, and 26.5% respectively for the week on a bearish USDA acreage report.

Currencies:
Ahead of the long weekend, the U.S. dollar strengthened against all major currencies, helped by a U.S. job report that was not as negative as it was anticipated. The U.S. labor department stated that U.S. non-farm payrolls fell by 62,000, while some economists expected a 60,000 decline.
-The dollar index rose ~1.03% on Thursday hitting an intraday high of 72.80.
-Thursday, the ECB decided to hike interest rates by a widely anticipated 25 basis points to 4.25%. The first hike in more than a year pushed the euro as high as $1.5907 against the greenback. The rise in the euro was shortly lived, as the currency hit a low of $1.5683 per dollar, after comments from ECB President Trichet failed to signal any further rate hikes in the euro zone.
-During Thursday’s midday trading session, the euro was at $1.5691 per dollar, from $1.5882 late Wednesday, while the Japanese yen traded at 106.72 yen per dollar, from 105.89 yen late Wednesday. The pound sterling was at $1.9813 per pound, from $1.9930 late Wednesday.

Highlights: Colombia & Chile
-The Colombian peso gained some momentum versus the greenback as investors’ confidence in Colombian assets increased, following a rescue of fifteen hostages held by the FARC. Midday Thursday, the Colombian peso rose 2.15% against the dollar to 1,741.40 pesos per dollar, from 1,780.00 late Wednesday. The peso has appreciated by 13.66% year-to-date against the greenback.
-The Chilean peso strengthened by 1.48% on Thursday to 509.200 pesos per dollar, after inflation data in Chile hit a 17-year high. Investors bought the peso anticipating an interest hike by the Chilean Central Bank in efforts to offset inflation. The Chilean peso traded at 509.200 on Thursday from 516.850 late Wednesday, and is up by 2.31% year-to-date.

Market Stats:
· The Dow ended down -57.98 or -0.51% for the week
-Friday, the Dow closed at 11,288.53, up 73.02 or 0.65%
-The Dow is Negative YTD down -14.90%
-The Dow is off by -2,876.00 or -20.30% from the market peak on October 9th of 14,164.53

· The NASDAQ ended down -70.25 or -3.03% for the week
-Friday, the NASDAQ Composite closed at 2,245.38, down -6.08 or -0.27%
-The NASDAQ is Negative YTD down -15.34%
-The NASDAQ is off by -613.74 or -21.47% from the market peak on October 31 of 2,859.12

· The S&P 500 ended down -15.48 or -1.21% for the week
-Friday the S&P 500 closed at 1,262.90, up 1.38 or 0.11%
-The S&P is Negative YTD down -13.99%
-The S&P is off by -302.25 or -19.31% from the market peak on October 9th of 1,565.15

S&P Sector Performance for the week ending Friday, July 3, 2008:
S&P 500 Utilities Sector (.GSPU) Up 3.15 or 1.56%
S&P 500 Consumer Staples Sector (.GSPS) Up 3.38 or 1.23%
S&P 500 Health Care Sector (.GSPHC) Up 4.19 or 1.19%
S&P 500 Telecomm Services Sector (.GSPTS) Up 0.37 or 0.28%
S&P 500 Industrials Sector (.GSPI) Down -2.95 or -0.98%
S&P 500 Energy Sector (.GSPE) Down -8.87 or -1.38%
S&P 500 Information Technology Sector (.GSPT) Down -8.31 or -2.31%
S&P 500 Consumer Discretionary Sector (.GSPD) Down -5.41 or -2.40%
S&P 500 Financials Sector (.GSPF) Down -7.96 or -2.88%
S&P 500 Materials Sector (.GSPM) Down -15.06 or -5.77%

S&P Top 10 Performers for the week ending Friday, July 3, 2008:
Family Dollar Stores Inc (FDO) Up 3.10 or 15.96%
Apollo Group Inc (APOL ) Up 7.23 or 15.08%
Washington Mutual Inc ( WM) Up 0.58 or 12.08%
Amgen Inc (AMGN) Up 4.47 or 9.64%
Constellation Brands Inc (STZ) Up 1.58 or 8.04%
Campbell Soup Co (CPB) Up 2.50 or 7.77%
Celgene Corp (CELG) Up 4.04 or 6.38%
Sunoco Inc (SUN) Up 2.21 or 5.90%
American Express Co (AXP) Up 2.20 or 5.78%
Procter & Gamble Co (PG) Up 3.18 or 5.26%

S&P 10 Worst Performers for the week ending Friday, July 3, 2008:
Fidelity National Information Srvcs Inc (FIS) Down -16.83 or -45.52%
NVIDIA Corporation (NVDA) Down -6.79 or -35.22%
Circuit City Stores Inc (CC) Down -0.95 or -29.14%
Freddie Mac (FRE) Down -3.35 or -18.77%
Ambac Financial Group Inc (ABK) Down -0.28 or -17.39%
Zions Bancorporation (ZION) Down -5.50 or -16.90%
United States Steel Corporation (X) Down -31.13 or -16.65%
Nucor Corp (NUE) Down -12.34 or -16.48%
Xl Capital Ltd (XL) Down -3.90 or -16.41%
CONSOL Energy Inc (CNX) Down -17.12 or -15.29%

Dow Top Performers for the week ending Friday, July 3, 2008:
American Express Co (AXP) Up 2.20 or 5.78%
Procter & Gamble Co (PG) Up 3.18 or 5.26%
Verizon Communications (VZ) Up 1.47 or 4.29%
Merck & Co Inc (MRK) Up 1.47 or 3.98%
Pfizer Inc (PFE) Up 0.47 or 2.72%
General Electric Co (GE ) Up 0.65 or 2.48%
Johnson and Johnson (JNJ) Up 1.55 or 2.44%
Exxon Mobil Corp (XOM) Up 1.72 or 1.99%
McDonald's Corporation (MCD) Up 0.69 or 1.22%
Chevron Corp (CVX) Up 0.83 or 0.85%

Dow Worst Performers for the week ending Friday, July 3, 2008:
General Motors Corp (GM) Down -1.43 or -12.38%
Bank Of America Corp (BAC) Down -2.19 or -8.91%
ALCOA Inc (AA) Down -2.60 or -7.35%
Home Depot Inc (HD) Down -1.48 or -6.16%
Microsoft Corp (MSFT) Down -1.65 or -5.97%
American International Group Inc (AIG) Down -1.51 or -5.44%
Caterpillar Inc (CAT) Down -3.44 or -4.66%
Intel Corp (INTC) Down -0.83 or -3.86%
The Boeing Co (BA) Down -2.45 or -3.66%
Hewlett-Packard Co (HPQ) Down -1.14 or -2.56%

Key Earnings next week:
Tuesday: Pepsi Bottling (PBG), Alcoa (AA)
Wednesday: Acergy (ACGY), Shaw Group (SGR)
Thursday: Marriot International (MAR)
Friday: General Electric (GE)

Economic Data next week:
Tuesday: Pending Home Sales, Consumer Credit
Wednesday: EIA Crude Inventories (weekly)
Thursday: Chain Store Sales, Money Supply, Jobless Claims (weekly)
Friday: International Trade, Consumer Sentiment, Import & Export Prices

Bythenumbers.cnbc.com

Symbol
Price
 
Change
%Change
AA
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ALXN
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CHK
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CIT
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ERII
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F
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ORA
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GM
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GS
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FOXA
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PEIX
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POLXF
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SBUX
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VOD
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