Thursday, April 19, 2007

Morning Market Comment

With Globex futures down about 7 this morning, it's looking like the tape will be painted red this morning. A big reason? China. China's GDP grows 11.1 percent in first quarter threatens the possibility that interest rates will have to be raised, or other measures taken in that country to cool their economy. You'll recall, the "other measure" in China that sent markets off a cliff in late February was an increase in banking reserve requirements in China. The China rate increase talk is beneficial to the Yen once again, with a rise of 48 ponts and bad for gold which is flirting with $688 and has caused me to move to a short on gold futures only, but still holding GLD.

So much for my late day theory yesterday that the stock market could rise to even greater heights, but that's actually a good a thing - that there is such a thing as limits on Wall Street.

By the way, while the Chinese may be finding it tough to control their speeding locomotive of an economy, they are making strides in controlling that little ol' thing we call the weather: Chinese make first artificial snowfall in attempt to control weather...

Could it be that the departure of Sanjaya Malakar from "Idol" is the real negative that has swept global markets with the broom of gloom? Just askin'.

Bank of America (BAC) and Merrill Lynch (MER) are both showing small plus signs this morning. The Journal sums it this way: MERRILL LYNCH'S NET SOARED on strong investment banking, as a year-earlier charge hurt earnings in that period. Bank of America posted a 5% increase in earnings, helped by robust equity markets and the boom in mergers and acquisitions.

A few other quick earnings: Merck Net Jumps 12 Percent, Altria 1st-Quarter Profit Drops 21 Pct.

BPOP finally posted results this morning: Popular, Inc. Reports Financial Results for the Quarter Ended March 31, 2007. My reading of the results shows a loss for the quarter when the one time capital gain is factored out. But still the stock looks little changed ahead of the open.

Economic Report: Jobless claims remain elevated at 339,000.

Pete Stolcer's has a full list of movers this morning.

See the latest on hedge funds at:

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