Closing Update for Wednesday, September 2: Slide Stretches to Day 4

4:16 PM, Sep 2, 2009 --

• NYSE down 13 (0.2%) to 6,474.78.
• DJIA down 29.9 (0.3%) to 9,281
• S&P 500 down 3.3 (0.3%) to 994.75.
• Nasdaq down 1.82 (0.1%) to 1,967.

GLOBAL SENTIMENT

• Hang Seng down 1.76%
• Nikkei down 2.37%
• FTSE down 0.04%

DOWNSIDE MOVERS

(-) Raser (RZ) says loan application denied by DOE.

(-) FNM, FRE down after report hits that industry group wants mortgage cos. split into smaller, private operations.

(-) DHT (DHT) revenue meets, decides not to declare dividend.

(-) Alcatel-Lucent (ALU) launches bond offering.

(-) Joy Global (JOYG) tops with Q3 results, raises guidance.

(-) Tower Semi (TSEM) hikes revenue view.

UPSIDE MOVERS

(+) FLOW prices offering.

(+) Vonage (VG) conducting a beta test for the much talked about iPhone and iPod application.

(+) Las Vegas Sands (LVS) gets upgrade, secures capital through exchangeable bond sale.

(+) Blockbuster (BBI) reduces credit agreement with former parent Viacom.

(+) VeriFone (PAY) settles with SEC over false financial statements.

(+) Peregrine Pharmaceuticals (PPHM) reports positive Phase II data for Cotara in brain cancer.

(+) BP announces big discovery in Gulf of Mexico.

MARKET DIRECTION

Stocks declined anew in the final minutes of trading, landing the broad averages in negative territory for a fourth straight day. Stocks have fallen since carving out fresh highs for the year early last week. All averages finish down only around 0.3% after a narrow trading range ahead of Friday's jobs report and the long holiday weekend.

The Nasdaq had edged into positive ground in afternoon trading. Stocks improved after Federal Reserve meeting minutes revealed that members were much more optimistic about the end of the recession in August than in June. Many Fed officials saw "smaller downside risks," the documents stated.

But holding sway this morning was a report from ADP and Macroeconomic Advisers that said private employers cut 298,000 jobs in August, fewer than a revised 360,000 jobs lost in July, but more than the 250,000 mean forecast in a Reuters poll. The National Employment Report usually presages the closely-watched monthly government figures on employment, due on Friday.

A separate report released earlier this morning by outplacement firm Challenger, Gray & Christmas Inc. showed that the number of firms planning layoffs fell 21% in August.

Separately, the Labor Department said that productivity rose at an annual rate of 6.6% in the April-June quarter, the largest advance since the summer of 2003. Economists expected an increase of 6.4%, matching the government's initial estimate last month. Labor costs fell by the most in nine years

Crude closes unchanged at $68.05 a barrel. Gold hits a three-month high, up $22 or 2.3% at $978.50 an ounce as the dollar weakened.

Crude inventories fell by 400,000 barrels during the week ended Aug. 28, far less than economists' estimates for a 1.9 million barrel drop, adding further weight to the week-long slide in oil prices.

The Energy Information Administration also reported that gasoline inventories fell by 3 million barrels and distillate stockpiles rose by 1.2 million barrels. Analysts expected a drop of 1.4 million barrels in gasoline and a decline of 600,000 barrels in distillate stockpiles, according to a Platts' survey.

The American Petroleum Institute reported late Tuesday that U.S. crude stockpiles fell by 3.2 million barrels for the week ended Aug. 28. Analysts surveyed by Platts expected a decline of 1.9 million barrels. API uses a different measure to gauge crude supplies.

Comments

[robert.b.fe...:]

Great Job Midnight Trader. You wouldn't happen to know what an echangeable bond is do you? Sounds like something from a chemistry class in the long ago..

Sep 02 06:22 PM

[robert.b.fe...:]

My bad. That's exchangable.

Sep 02 06:23 PM

[Bill L.:]

(+) Las Vegas Sands (LVS) gets upgrade, secures capital through exchangeable bond sale.

-Sheldon Adelson lost more money than anyone on the planet during this bear market, something like 36.5 Billion or so, and he's still trying to get even more loans to keep expanding, and get deeper and deeper into debt. Upgrade all you like, where were you when the stock was a dollar.

Sep 02 07:51 PM

[OceanTiger:]

Due to concerns about job losses and the weakness of labor markets , 298,000 private jobs were lost last month , today is a low-volume sell-off trade day, the official jobs report for August will be released Friday, next week we will see market direction. Hold value stocks such as HPQ, ABT, GILD… see Trade4Rich.com

Sep 02 09:17 PM

[Moon Kil Woong:]

Thanks for the update. A rise in distillates is a sign of weakness not only for the oil producing side but the much less notice but much more important processing side of the oil related ecosystem. This coming during peak driving season is a very bad sign for the Fall fall-off in demand.

Sep 02 09:51 PM

[daniel3582:]

I have been following the overnight action in crude futures... Further weakness, as well as continued weakness on the e-Mini SP500 contract. If crude continues to slide tomorrow, I would be careful.

The probability of registering a DeMark perfection buy on the crude contract tomorrow is almost 100%. It will, unless the contract closes above $69.57 tomorrow. Highly unlikely.

The perfection buy is registered as a result of price being unable to break through the previous TDST price support that was set at the last big rally upward.

Keep in mind, we will have renewed strength at the open... hourly charts are showing a buy as well - however, since we are in a daily bar downtrend I would not use this information for more than a day trade opportunity.

Sep 02 09:59 PM

[rick12345:]

My tips, for what they're worth.

USD should build strength from here. Oil could hit $100 by the end of the year, but either way, I think we'll see a slight correction upwards very soon. Sold my financials today at a small profit; too much uncertainty re banks for my liking. I still believe Tech' stocks are the way to go heading out of a recession; All we need now is a decent increase in capital expenditure. I like Nokia and Dell. If gold doesn't break 1000 Tomorrow or Friday, which I don't believe it will,
we could see a deep,deep correction in the price.
People are reading way too much into trends at the moment. The "September is a bad month for equities" mentality, or "Gold performs better in September than any other month" theory, for example. A building constructed on poor foundations is destined to tumble at some time in the future. Thence, although most of you will disagree, this is why I am convinced the bull run which is about to occur shortly, will be long and sustained, supported by improving economic strength.

Sep 02 10:04 PM

[Joe Shareho...:]

Look for UNG to drop to 8 and then time to load up. Read more at joeshareholder.blogspo...

Sep 02 11:49 PM

[Alpha_Male:]

Sheldon Anderson and the boys at the top of the LVS organization have been buying up shares like crazy.... I wonder if they know something we dont...

Sep 03 12:07 PM

[bobbybutte:]

shellie adelson is his name. these guys have finally gotten financing and as rates go lower and the economy gets better sands stock should rise long term

Sep 03 12:16 PM