Tuesday, June 17, 2008

Market Recap 06/17/08

I'm going to try to keep up a daily recap for a few days and see how it goes. I'll be posting here and cross posting on JoshSebastian.BlogSpot.com. Just check my blog shortly after the market close and it should be waiting for you. Primarily I'll be concentrating on macro economic trends and providing commentary on news. If people like it, rec it, and I'll keep it up on caps. If not, I'll just post on my personal blog only and you can find it there.

May building permits fall 3.3% to 17 year low - Nothing to say there.

U.S. PPI up 7.2% in past year - Most of that hasn't been passed down the supply chain yet. Neither have the petro prices factored into good. So unless retailers and vendors can pass it on (very doubtful), look for some retailers to go under as they get squeezed. This news also pushed the dollar down. The effect was seen as a rise in gold, but not seen in oil (showing short-term weakness or consolidation perhaps?).

May industrial output down 0.2% - It's not much, but we were still contracting (read: receding (read: recession)) in May despite what spending may say. "Output at the nation's factories, mines and utilities fell in May for the third month out of the last four"

Goldman Sachs reports profit off by 10%, still beats expectations - Goldman could be the new Bear Stearns. No, not that Bear Stearns, the OLD Bear Stearns that kicked A$$ and took names. As many of it's peers crumble, GS is able to keep pulling it off. Watch for the others to report to see just how well GS is holding up comparatively. This may not be a hot bet though as goldman is staying alive, yet contracting.

Goldman - also made a point of saying that March was the low point thus far in the credit crunch. Thus, they and a lot of other people know something the equity market does not. Do you know what it is, I do.

Goldman - lastly said banks need to raise more cash. Gosh! Really? The govt. has reported we've lost $1.7T worth of wealth. However, the banking industry is still leveraged up and unwilling to report anything close to $1.7T in write-downs....as long as they have access to the fed window. As I've said before, Its about Solvency.

Paulson says U.S. & China face energy inflation challenges - Too bad no one told him China still subsidizes fuel...or that the Yuan is appreciating. Oh well.

Oil down slightly (on growth concerns?) - To be clear, reports are saying oil is falling on growth concerns, I'm not saying anything. Lately the U.S. investors have been pushing up the oil futures during the day while Asia and Europe bring them back down at night. Prices are starting to align today however..which could mean the beginning of a move either way. My guess would be up, but between the CFTC speculation report and June 22nd OPEC meeting, I'm holding cash.

Anoter OPEC country oil minister says oil price too high - Man...these guys talking about high oil problem is like the U.S. talking about a low dollar problem. Just talk. Until I see some production increases from the Saudi's or the Kuwaiti's (YAWN)

Things may be getting shakier for Europe & the Euro - Mish is reporting Support for euro in doubt as Germans reject Latin bloc notes. Not only are divisions growing in the EU, but the European Central Bank and the Fed are starting to diverge in their paths also. Bernanke is VERY low on options for an exit strategy. Keep an eye on this one! Again, Its about Solvency.

Evergreen Solar upped guidance by more than 10% - Solar provides just a tiny percentage of our energy, but is one of the only viable solutions. Though solar stocks are very volatile, I would expect this trend to continue long into the future. If so, expect exponential growth in solar for years to come.

Executives at U.S. commodities exchanges warn regulation may push investors to less regulated exchanges outside U.S. - Gee no one saw this coming; Lieberman's Speculation Regulation Farce...and they're correct. The U.S. cannot regulate a global market, but it may be fun to watch them try!

McCain: Drill Offshore - First, I'll say that I don't think it will do much good. Second, I couldn't care less, other than the potential effect on my trading.

Ford idling more plants longer, still paying employees under union agreement - Well...it's a step...I think.

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