To Early to Tell the Sell?

So the only thing that matters here is whether we have broken the back of the "sell the rally" trade that has been so successful for the past two months. It's too early to tell.

How bearish has the Street been? Institutional Investor, which has conducted a weekly Bull/Bear survey of financial newsletter writers for decades, today noted that the percentage of writers Bullish fell 10 percent to 31.1 percent and Bears rose almost 7 points to 43.3 percent. It's the first time since 2002 that Bears exceeded Bulls.

Did the Fed move just in time? Home loan demand is dropping, and mortgage rates have hit their highest levels since October, according to the Mortgage Bankers Association.

Freddie Mac's analyst meeting has started. Their CEO has said that the U.S. housing market is the worst in about a century. Their CFO said "there is no dilutive capital raise planned."

A day after Wellpoint cut its guidance and initiated a bloodbath among HMOs, Humana has done the same for the full year. They are now talking about full year guidance of $4.00-$4.25, compared to previous guidance of $5.35-$5.55. The culprit: higher claims volumes. Humana down 21 percent pre-open (after dropping 24 percent yesterday!), United Healthcare down 9 percent, Aetna down 7 percent. Humana, unlike Wellpoint, is primarily a Medicare provider.

Caterpillar's CEO said everything was going to be great for the next several years. He talked about significant new infrastructure projects all over the world. Unfortunately, he forgot to raise guidance, so Cat is only up 3 percent.

Questions? Comments?