Just a Regular Monday

The action on Monday paled in comparison to all the action occurring last Friday during options expiration but the market did manage to do an about face. The NASDAQ 100 thought it was in Vegas as it was up 7.77 on the day. We’re not sure what the payout was but the number seemed lucky.

Speaking of the NASDAQ 100 (NDX), that is where the four horsemen reside and they were highly sought after today. RIMM, AAPL, GOOG, and AMZN had multiple point runs on Monday and helped the NDX to one of the only gains for a major index. The Dow was down just over 60 along with most every other index.

Other than that there wasn’t much going on in the market on Monday. The big news was the strike by the UAW against GM. We mentioned a while back that the company had made claims about the demand for cars being strong enough that they could reduce the rebates they were offering. This was during the negotiations with the union. We wonder if whoever was responsible for that leak is still working there.

The other big item was the statement by the IMF that, according to the WSJ, “although global economic fallout from the US subprime mortgage crisis is likely to be protracted, governments shouldn’t rush to regulate everything.” The IMF also said that “it is trying to prevent future crisis by highlighting potential problems ahead of time.” OK, this report follows their thoughts back in April when the fund said that a “major dislocation still appears to be a low-probability event.” So, now they want to highlight potential problems ahead of time, right…

After the market closed, Target and Lowe's announced some news that indicated sales were down and earnings would probably be down as well. Of course, Lowe's blamed it on the housing slump, which is no surprise, but taken together, these two strong retailers are making it known that the consumer may not be shopping as much as even a few months ago. Could this be some of what the Fed was concerned about when it cut rates last week?

Tuesday we get to see the existing home sales for August as well as some fairly new consumer confidence numbers. We'll see if the bullish attitude has permeated into the consumer confidence numbers. We're not quite sure that the normal consumer has derived much confidence from the Fed's 50 bps interest rate cut. We don't think so especially with the news from Target and Lowe's . The expectations are for a small drop in the confidence numbers and a fairly large drop in existing home sales.