Market Close
Very low volume, yet again. After the early morning sell off following the consumer confidence numbers the market just drifted upwards on very low volume. Lack of confidence continues to grow yet again.
AÂ while back we wrote that we needed to watch for ‘deals’ to fall apart as the credit implosion impacted corporate mergers and takeovers. Just before the closing bell we got this:
WSJ: CLEAR CHANNEL DEAL “NEAR COLLAPSE”
- WSJ reports that the private equity firms and the banks providing financing are mired over the details of a credit pact. One source tells WSJ “no one wants to do this deal except for the seller.
This deal, which began back in 2006 and which was worth around $20 Billion now appears to be dead. Another victim of banks not lending and tightening up further on their purse strings.
And more asset backed securities are worth even less tonight:
S&P CUTS 195 RATINGS ON 32 US CDOS OF ABS; AFFECTING $39.58 Billion Dollars
And now the Fed Funds futures are pricing in yet another rate cut in April. With the added signs of the economy still deteriorating the Fed Funds futures are now raising the possibilities of at least a 50 basis point rate cut. Here we go again. The US dollar is falling again and now commodities are on the rise yet again. If the Federal Reserve cuts rates again, then they will shorten the fuse on a ticking bomb.
The full daily wrap up tonight…Â
I haven’t requested a chart in a while, so I thought I would get your “technical” opinion of PTNR. Can you give me your thoughts on the chart of PTNR?
At this particular time, and in the short term, I don’t think the market cares about daily economic news. Bank of America could fold up the shop and the market would rally on the news. So many stocks have been taken to the woodshed and demolished that there isn’t much more room on the downside. Even in bear markets most stocks don’t go to “zero” in a straight line. I think this is a bear market bounce, but it may last a bit longer.