Ich glaube,es geht heute weiter abwärts.
Eventuell kaufe ich heute noch eine Putoption auf den Dow.
Hat jemand Vorschläge????
There's Nothing on the Horizon to Lift Markets
The Wall Street Journal Online
Monetary policy decisions normally attract a lot of attention on Wall Street. But the expected rate cut from the Federal Reserve -- one of the only scheduled events of note in the coming week -- is likely to be the very definition of " anticlimax."
A quarter-point cut in short-term interest rates is pretty much a lock, analysts agree, and they expect the Fed to reiterate that the possibility of further economic erosion is greater than that of inflation.
The rate cut, expected following Tuesday's meeting of Fed policy chiefs, would be the central bank's seventh attempt to jump-start the languishing economy through interest-rate cuts this year. It would bring the federal-funds rate -- the interest that banks charge each other for overnight loans -- to 3.5%. The fed-funds rate started the year at 6%.
Following the string of rate cuts, economic indicators generally have moved from weak to mixed. Still, market watchers seem to agree that stocks, especially in the foundering technology sector, will take longer to catch up.
Many investors still consider tech stocks -- many of which sport exorbitant price-to-earnings ratios -- too rich to buy, even after the market's months-long slide.
"The idea that these stocks are still overvalued is still plausible," said Ricky Harrington, technical analyst at Wachovia Securities. "Bear markets don't end overnight." He predicted the Dow Jones Industrial Average would fall below 10000 and the Nasdaq Composite will retest its year low of 1638.80.
Because another rate cut has long been expected, it is unlikely to lift markets next week, analysts say. Anything short of a spectacular departure from the expected outcome is unlikely to either hoist the market into a sustained rally or send it spiraling downward.
Charles Blood, market analyst at closely held bank Brown Brothers Harriman, said people pay less attention to the Fed moves lately, as they're too busy fretting about corporate profits.
"I think that has created a level of uncertainty that has held people back from reacting to all this good monetary policy," he noted, adding that when it's clearer that the economy has finished its downward cycle, it will put an end to the speculation on how much earnings will disintegrate.
"It's going to be a big yawn," Adam Weisman, managing director for equity trading at investment banking company Wit SoundView said of the expected Fed decision. "I don't anticipate them doing anything more than the Street's expecting them to. It's going to be an unbelievably quiet week."
Most analysts agreed the possibility of a half-point cut was scant.
Dennis Hynes, chief market strategist at R.W. Pressprich, an institutional bond-trading firm, said the fed-funds futures market put the probability of a quarter-point cut by the Federal Open Market Committee at about 84%, while the probability for a half-point cut was at 16%.
"They don't want to get too aggressive," said Steven Goldman, market strategist at institutional investment firm Weeden & Co. "The economy is still doing OK. The data shows we're not in a recession. [Manufacturing] has imploded, but we're generally holding on."
This past week, the Dow ended down 1.7% to 10234.27, while the Nasdaq gave up 4.6% to 1867.64.
Despite the gloomy picture that most analysts are painting for technology stocks, others held out hope. Arnold Berman, technology strategist at Wit SoundView, said the market would continue to waffle. But in periods of selling, volume has been light, indicating that investors aren't fleeing.
"I'm not getting huge volumes right now, [and] in some ways that's good," said Mr. Berman, who expects even lighter trading volume this week. "If it was huge volume right now, I'd say that's capitulatory selling. I don't have the conviction that people don't want to own [technology stocks]."
He cited new signs of improvement in the sector: fewer order cancellations, some thinning of clogged inventories, and a better book-to-bill ratio. And yet, Mr. Berman said, "The hurt instinct still prevails, no matter how much people say they want to buy weakness and sell strength."
Some watchers have pointed to market breadth -- advancing stocks outpacing decliners -- as a signal that overall sentiment remains upbeat. In the past 10 trading days, advancers have outweighed decliners seven times despite the a decline of 1.8% in the New York Stock Exchange Composite index during that same time.
However, some analysts were quick to debunk the theory. Mr. Harrington said it's misleading, noting that many of the Big Board's stocks are interest-rate sensitive issues -- for instance, foreign stocks, banking stocks or closed-end funds. When interest rates are stable or moving lower, the odds are that the breadth of the market will be positive.
Major indexes can fall -- since they're weighted by market capitalization -- at the same time the advancing-declining line rises, since all stocks are weighted equally.
The situation could be compared to states' representation in the Senate and House. Big-name technology stocks would represent heavily populated states, with a lot of power in the House (in this case, indexes) but equal weighting in the Senate (advancers and decliners).
Mr. Goldman was quick to point out that it was big losses in the technology sector that have really swayed the market this year, but not necessarily the advancers/decliners line.
Over the long haul, most say investors should brace for a long, painful struggle as corporate profits begin to right themselves.
"This is truly the hangover for the party we all went to the last few years," said Mr. Weisman, "and it's tough to pick your head off the pillow."
Write to Erin Schulte at erin.schulte@wsj.com
Eventuell kaufe ich heute noch eine Putoption auf den Dow.
Hat jemand Vorschläge????
There's Nothing on the Horizon to Lift Markets
The Wall Street Journal Online
Monetary policy decisions normally attract a lot of attention on Wall Street. But the expected rate cut from the Federal Reserve -- one of the only scheduled events of note in the coming week -- is likely to be the very definition of " anticlimax."
A quarter-point cut in short-term interest rates is pretty much a lock, analysts agree, and they expect the Fed to reiterate that the possibility of further economic erosion is greater than that of inflation.
The rate cut, expected following Tuesday's meeting of Fed policy chiefs, would be the central bank's seventh attempt to jump-start the languishing economy through interest-rate cuts this year. It would bring the federal-funds rate -- the interest that banks charge each other for overnight loans -- to 3.5%. The fed-funds rate started the year at 6%.
Following the string of rate cuts, economic indicators generally have moved from weak to mixed. Still, market watchers seem to agree that stocks, especially in the foundering technology sector, will take longer to catch up.
Many investors still consider tech stocks -- many of which sport exorbitant price-to-earnings ratios -- too rich to buy, even after the market's months-long slide.
"The idea that these stocks are still overvalued is still plausible," said Ricky Harrington, technical analyst at Wachovia Securities. "Bear markets don't end overnight." He predicted the Dow Jones Industrial Average would fall below 10000 and the Nasdaq Composite will retest its year low of 1638.80.
Because another rate cut has long been expected, it is unlikely to lift markets next week, analysts say. Anything short of a spectacular departure from the expected outcome is unlikely to either hoist the market into a sustained rally or send it spiraling downward.
Charles Blood, market analyst at closely held bank Brown Brothers Harriman, said people pay less attention to the Fed moves lately, as they're too busy fretting about corporate profits.
"I think that has created a level of uncertainty that has held people back from reacting to all this good monetary policy," he noted, adding that when it's clearer that the economy has finished its downward cycle, it will put an end to the speculation on how much earnings will disintegrate.
"It's going to be a big yawn," Adam Weisman, managing director for equity trading at investment banking company Wit SoundView said of the expected Fed decision. "I don't anticipate them doing anything more than the Street's expecting them to. It's going to be an unbelievably quiet week."
Most analysts agreed the possibility of a half-point cut was scant.
Dennis Hynes, chief market strategist at R.W. Pressprich, an institutional bond-trading firm, said the fed-funds futures market put the probability of a quarter-point cut by the Federal Open Market Committee at about 84%, while the probability for a half-point cut was at 16%.
"They don't want to get too aggressive," said Steven Goldman, market strategist at institutional investment firm Weeden & Co. "The economy is still doing OK. The data shows we're not in a recession. [Manufacturing] has imploded, but we're generally holding on."
This past week, the Dow ended down 1.7% to 10234.27, while the Nasdaq gave up 4.6% to 1867.64.
Despite the gloomy picture that most analysts are painting for technology stocks, others held out hope. Arnold Berman, technology strategist at Wit SoundView, said the market would continue to waffle. But in periods of selling, volume has been light, indicating that investors aren't fleeing.
"I'm not getting huge volumes right now, [and] in some ways that's good," said Mr. Berman, who expects even lighter trading volume this week. "If it was huge volume right now, I'd say that's capitulatory selling. I don't have the conviction that people don't want to own [technology stocks]."
He cited new signs of improvement in the sector: fewer order cancellations, some thinning of clogged inventories, and a better book-to-bill ratio. And yet, Mr. Berman said, "The hurt instinct still prevails, no matter how much people say they want to buy weakness and sell strength."
Some watchers have pointed to market breadth -- advancing stocks outpacing decliners -- as a signal that overall sentiment remains upbeat. In the past 10 trading days, advancers have outweighed decliners seven times despite the a decline of 1.8% in the New York Stock Exchange Composite index during that same time.
However, some analysts were quick to debunk the theory. Mr. Harrington said it's misleading, noting that many of the Big Board's stocks are interest-rate sensitive issues -- for instance, foreign stocks, banking stocks or closed-end funds. When interest rates are stable or moving lower, the odds are that the breadth of the market will be positive.
Major indexes can fall -- since they're weighted by market capitalization -- at the same time the advancing-declining line rises, since all stocks are weighted equally.
The situation could be compared to states' representation in the Senate and House. Big-name technology stocks would represent heavily populated states, with a lot of power in the House (in this case, indexes) but equal weighting in the Senate (advancers and decliners).
Mr. Goldman was quick to point out that it was big losses in the technology sector that have really swayed the market this year, but not necessarily the advancers/decliners line.
Over the long haul, most say investors should brace for a long, painful struggle as corporate profits begin to right themselves.
"This is truly the hangover for the party we all went to the last few years," said Mr. Weisman, "and it's tough to pick your head off the pillow."
Write to Erin Schulte at erin.schulte@wsj.com
