Markets Down as Traders Focus on Not Losing Money

[Excerpted from Bill Cara's Daily Report]

US equity markets fell once again on Tuesday (S&P cash -0.64%), and futures ended the day priced to decline another -1.5% Wednesday morning, but were very strong just prior to the open. Discretion being the better part of valor, traders are still being forced to focus on not losing money, rather than putting on new positions.

At the end of the session, the DJIA (-37.27 -0.55% to 6726.02, down from Friday’s 7062.93 close); the S&P 500 (-4.49 -0.64% to 696.33, down from Friday’s 735.09); and the NASDAQ Composite (-1.84 -0.14% to 1321.01, down from 1377.84) showed a continuing lack of confidence by traders.

The Canadian markets were also soft as the Toronto Composite dropped -55.89 -0.73% to 7631.62, down from Friday’s 8123.02 close, and the Venture Board was down 4.17 -0.50% to 824.07.

Earlier in the day Wednesday, Asia-Pacific equity markets were strong except for Australia (-1.43% to 3125.9): Japan (+0.85% to 7291.0), Shanghai China (+6.12% to 2198.1), Hong Kong (+2.47% to 12331.2), and India (+0.23% to 8446.5).

The French CAC (+2.64%), the German DAX (+3.22%), and the UK FTSE 100 (+2.13%) were strong at 9:30am ET Wednesday.

Tuesday in NY, the sector leaders were Energy (XLE +0.50%) and Basic Materials (XLB +0.40%), while the Utilities (XLU -3.58%) and financials (XLF -1.97%) were the biggest losers.

The Goldminers ($XAU +3.1%) were relatively strong. The near futures ($GOLD) closed down -$26.40/oz, however.

The spot prices for gold, palladium, platinum and silver at 9:30 am ET Wednesday were: 918.15; 192.5; 1035.5; and 13.08, respectively.

Crude Oil ($WTIC) closed up yesterday +$1.50/bbl to 41.65.

As for the Cara 100 Tuesday, the big winners were short-covering reversals mostly: Dell (DELL +8.5%); MICC (MICC +7.0%); and First Solar (FSLR +6.2%). Goldminer Kinross (KGC +6.0%) was strong. The big losers (MFC and GE, down -11.3% and -7.8% respectively) will now be eliminated from the Cara 100 as I can no longer vouch for their quality.

A Cara 100 decision on another Canadian in the Cara 100, Teck (TCK), will be made today after I personally meet with the company VP of IR and corporate strategy.

Tuesday, US Treasuries lost -0.20% to close at 125.77. Treasury yields for the 30-, 10-, and 5-year paper closed at 3.724, 3.034, and 1.991%, respectively.

The $USD was up +0.06% to 88.94, and was a little stronger today too. The Euro closed at 125.54, down -0.07%, and was at 125.65 this morning.

The DJIA and S&P 500 were trading up about +0.85% after the first 45 minutes Wednesday, led by Energy and Basic Materials.

Comments

[the_feds_co...:]

Its time to make our government work for us!
I have a message for our leaders in Washington:
REMOVE THE CAPITAL GAINS TAX FOR BANK STOCKS!
This action will pour money back into financials and ignite the markets ...Follow chinas lead ..CUT THE CAP GAINS TAX!!!

Mar 04 11:46 AM

[Steve in TN:]

I like the author's report on the markets, but I would appreciate if he could include some analysis of what he thinks is going on.

Mar 04 03:50 PM

[ptolaw:]

First Solar technology brings to mind just another "poison pill" with long term environmental and health issues for all living creatures. Is it the new asbestos with cancer causing effects? Clearly, be it solar farms, industrial businesses or smaller venues each, are in no way immune from catastrophic wind events. Solar voltaic cells must bask in the sunshine, if, manufactured comprising TOXIC substances it’s only a matter of time until exposures occur. Moreover, the aforementioned patent holder, of this type of critically insufficient technology fails to mitigate the design flaws in any robust way whatsoever. Questions remain in my mind as to the value of this thin film design, when in fact; it is so toxic and structurally weak. Also, at some point the product becomes refuse, how do we dispose of it? Additionally, when violent wind storms pass over these vast solar farms, destroying them, how do we protect ourselves and surrounding environment? Why use such TOXIC materials in the first place, when others are readily available? Is it just the love of more money? First Solar chose a doomed path - either ours or its own. For our sake, hopefully, it’s First Solar. Write to the men and women working for you in the United States Congress and say NO to TOXIC solar, it’s certainly NOT clean energy.

Mar 06 10:09 AM