Bulls Take a Day Off: Dave's Daily

The same can't be said for the energy and most precious metals as Bernanke gives the complex the green light. The Fed wants to reflate and if that's what they want, traders will accommodate them. You want to pay more for energy don't you? Thankfully it's not in the phony CPI because authorities want you to pretend you neither use heating oil, gasoline or even food for that matter. They've reconfigured the CPI more times than congress votes on a new debt ceiling. And, they do this to deceive but also to lower entitlement spending. Imagine all those government workers on COLAs and Social Security recipients who just stare at their heating and electric bills in disbelief. What's a nice T-bone cost nowadays anyway? It's the dropping price of tech toys and quality improvements they focus on that matters now.

Economic data was mostly disappointing versus estimates. Jobless Claims were up more than expected (377K vs 370 exp. & prior revised higher as usual to 356K); Durable Goods Orders also missed (+.3% vs +2.2% exp. & prior 4.3%); Leading Indicators missed (+.4% vs +.7% exp. & prior +.5%); and, New Home Sales also disappointed (307K vs 320K exp. & prior 314K prior).

On the earnings front 3M (MMM) another price heavyweight in the price-weighted DJIA beat expectations although falling short on the revenue side. AT&T, a DJIA component lightweight, disappointed as pension costs negatively affected earnings as did its takeover attempt of T-Mobile.

Stocks sold-off modestly as the trading day wore on. Bulls took a break from all the excitement during the previous few days of trading. Friday is the last day of January and some window-dressing is possible but it won't take much effort as the month's performance was excellent.

Volume was better overall but still light based on previous averages while breath per the WJS was mildly negative.

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SPY - The SPDR® S&P 500® ETF is a fund that, before expenses, generally corresponds to the price and yield performance of the S&P 500 Index. Our approach is designed to provide portfolios with low portfolio turnover, accurate tracking, and lower costs.
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