With options expiration due on Friday, we figured there would be some volatility this week and through Wednesday that was the case. We’re not sure if the market was actually open on Thursday since it traded in such a narrow range and on light volume.
Even with the release of the LEI, leading economic indicators, there wasn’t much stirring but, of course, that number was not worth stirring over. We had thought that with the stock market up strongly in April that the LEI would get a good boost in the arm. That wasn’t the case as stock prices were one of only two of the ten indicators showing gains, the other was the real money supply. (To make a statement about that, we would have to say that those are not the best two to be showing gains especially if the others are showing losses.) Seven others were down.
The actual number was down 0.5%, but last month’s number was revised up from 0.1% to 0.6% which is exactly 0.5%. With all of these big month late modifications in the number, the value of the LEI seems to be going down and the stock market did not care one bit about them. There was no pulse at all in stocks.
Thursday’s trading didn’t add much to the stock picture and we figure we should leave you alone this evening. There were some comments that Bernanke made about the housing market which didn’t sound like a bail out, but something like that will be tried. We’re not sure how effective it will be, especially since so many people have lost their homes due to foreclosure already. Anyway, Bernanke still thinks that the housing, what word should we use, oh yes, “problem” really isn’t too bad. “…the financial system will absorb the losses from the subprime mortgage problems without serious problems.” Oh, maybe we should have said Problem twice like he did.
Anyway, have a good weekend and we will try again next week.
Dow Industrials: 13,476.72 -10.81
HUI: 322.59 (gold weaker)
QQQRS: 0.34 bid
QQQRT: 0.61 bid
BEGBX: 13.84 (dollar stronger)