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Uptrend From November Lows Now Broken

I know we're all fed up with this year, but there are five more trading days left, and we have been drifting lower. In fact, the Dow has been down five days in a row.

Pay attention! The uptrend from the November lows has been broken.

November new and existing home sales were weaker than expected. One bright spot: the number of new homes for sale fell to the lowest levels since January 2004. If we get even a small uptick in sales, it will go a long toward reducing the inventory.

Retailers were weak on concerns that poor weather would further hurt sales—and companies like Jones Apparel were down 20 percent on debt concerns and exposure to department stores. The Int'l Council of Shopping Centers cut its Dec retail sales comp estimate to down 1% "or possibly more" from flat to up 1% last week.

However, they did note that "a third of consumers reported buying more holiday gifts in the form of merchandise rather than gift cards this year due to the hefty pre-Christmas discounts."

Sign of the times: Starbucks says they will not be guaranteeing matching employee contributions in 2009. They join Motorola and Kodak and FedEx (all suspending 401(k) contributions). This means less investments in the markets, since many do those investments specifically because they view the match as "free money."

    • American Express Gets $3.39 Billion in Bailout Money

- The Dow 30 at a Glance

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