Down Day

The stock market had quite a bit of news today including a 0.5% increase in the CPI, which translates to about a 6.0% annual rate of inflation. But, don't worry, the Core CPI, you know the one excluding food and ENERGY, was only up 0.1%. The bond market didn't seem to mind one bit and was strong all day.

The other early news was from WalMart, John Deere, American Eagle, and Gateway. WalMart said net income was only up 5.8% the smallest quarterly gain in four years and said rising energy prices is forcing them to lower forecasts. Gateway, well, not that it really matters, was roughed up by about 20% (ok not much in real dollars as it closed at 3.11). John Deere dropped over 11% after announcing earnings and providing lower guidance. American Eagle was down almost 10%.

The market had too much to deal with today and fell 120 in terms of the Dow and about 1.5% in the NASDAQ. All in all a pretty rough day. The Dow closed at the lowest point since early July. So, will this downtrend continue?

Well, when the regular market session closed, HPQ (Hewlett) announced earnings and raised guidance pushing the stock up 6% after the news. And, AMAT announced earnings saying that they probably saw the low point and now things should be good from here. Eternal optimism for the stock market, a virtual nirvana. So, of course, the after hours market was alive and well pushing the futures up to get ready for tomorrow.

Our position? Well, let me see, no, we haven't changed our minds. We still are looking for a drop at least until October. Then we will reassess, until then sell rallies.

Gold is pushing through resistance in the $440-$450 area but the mining stocks are starting to get a little sloppy. We will probably be waiting for a good spot to step aside for a while. We are looking at the HUI near 220 with heavy resistance up around 240. If we get near that area we will be happy to take some profits.

Dow Industrials: 10513.45 -120.93 (almost blew right through 10,500 without stopping)
BGEIX: 11.95

PS So much going on today, I'm sure there was a lot that I didn't mention. I know I forgot to mention the big computer virus that struck many companies, including the one I work for. We were having some trouble with our systems all day today. I'm hoping to get back to business tomorrow, we'll see.