The strong tanking action of today’s market session revolved around the falling markets in China, Japan and Europe as well as, a steep decline in durable goods orders data released this morning. The worst one day sell off in a decade for the Chinese markets began when word came out that the government may interfere to cool the speculation that drove the Shanghai market nearly 130 percent last year. Today’s session was accompanied by heavy trading volume and of course, strong selling as the Dow plunged 545 points at its lowest point of the trading day. Trading curbs were in effect during the strong sell off that left little, untouched with the red tone of the day. The DOW has not had a loss of 500 or more points since September 17, 2001 when it fell 694 points, the day the markets reopened after being closed after the terrorists attack on 911. Today is the fifth straight losing session for the DOW which is something not seen since its six session losing streak occurred from October 27, 2006 and November 3, 2006. The S&P Index hit its lowest level today, since November 29, 2006. The NASDAQ hasn’t had a point loss as it did today, since September 17, 2001. Today’s trading action produced record volume on both the New York Stock Exchange and the NASDAQ. The attempt on the life of Vice President Dick Cheney while in Pakistan by the Taliban, gave little solace to the strong down draft trend of the trading day.
At the end of the trading day, here is how the major indices ended the session: the DOW (Dow Jones Industrial Average) moved sharply lower today by 416.02 points to end the session at 12216.24; the NYSE (New York Stock Exchange) moved sharply lower by 334.05 points to end at 9087.39; the NASDAQ moved sharply lower by 96.65 points to close at 2407.87; the S&P 500 moved sharply lower by 50.33 points to end at 1399.04 and the RUSSELL 2000 moved sharply lower by 31.02 points to close at 792.67. The FTSE All-World Index ex-US (top Large/Mid Cap aggregate from over 2,700 stocks from the FTSE Global Equity Index Series (GEIS) which covers 90% of the worlds investable market capitalization) moved lower by 5.97 to close at 241.76 and the FTSE RAFI 1000 moved sharply lower by 204.47 to end at 5894.10 for the day.
Lorenzo Bini Smaghi, Member of the Executive Board of the European Central Bank commented today: defends European Central Bank sovereignty on Forex decisions; Forex messages must be consistent; no need to formalize Euro group dialogue and likely ineffectual unless agreed by G7.
Richmond Fed: Feb Manufacturing Index fell by 10 versus January drop by 11; February Manufacturing Shipments Index fell by 15 versus January drop by 13; February Services Revenues Index came in at 12 versus January reading of 1 and February Retail Revenues Index fell by 25 versus January drop by 26.
Mexico's 28-Day Cetes Yield Rises 0.02 percentage points to 7.05%; Mexico's 91-Day Cetes Yield Rises 0.11 percentage points to 7.27% and Mexico's 182-Day Cetes Yield Rises 0.20 percentage points to 7.47%.
Fed Discount Minutes: future rate hikes may be necessary.
French January Jobless Rate was 8.6% versus December Jobless Rate of 8.6% and French January Jobless Rate Forecast was at 8.6%.
Economic data released for the day:
ICSC-UBS Store Sales: Weekly measure of comparable store sales at major retail chains which is related to the general merchandise portion of retail sales, as reported by the International Council of Shopping Centers. This date accounts for approximately 10% of total retail sales. Store Sales week over week change came in at 0.2% and Store Sales year over year came in at 2.2%.
Durable Goods Orders: Reflecting new orders with domestic manufactures for immediate and future delivery of factory hard goods. U.S January Durable Goods Orders fell by 7.8% compared to consensus of a drop by 3.2%; January Durable Goods Orders, Excluding Transportation fell by 3.1%; January Durable Goods Orders, Excluding Defense fell by 7.8% and December Durable Goods Orders was revised to an increase by 2.8% from an increase of 2.9%.
Redbook: General merchandise portion of retail sales covering only approximately 10% of total retail sales, this data is a weekly measure of sales at department stores, chain stores and discounters. U.S. Retail Sales were down 1.2% for the first 3 weeks of February versus January.
Consumer Confidence: A compilation by the Conference Board of a survey of five thousand consumer attitudes, across the country, on present economic conditions and expectations of future conditions. U.S. Consumer Confidence Hits 5 ½ Year high in February; Conference Board February Expectations Index came in at 94.8 versus January 94.4 and Conference Board February Present Situation Index reading came in at 139.0 versus January reading of 133.9.
Existing Home Sales: Previously constructed homes, co-ops and condominiums closed during the month are tallied as Existing Home sales as reported by the National Association of Realtors. Existing Home Sales account for a large share of the market compared to new home sales plus, indicates the trend in housing markets. U.S. January Existing Home Sales rose by 3.0% to 6.46 Million rate; U.S. January Existing Home Sales Consensus 6.25M Rate; U.S. Inventory of Unsold U.S. Homes at a 6.6 Months Supply and U.S. January Median Existing Home Price fell by 3.1% on the year to $210,600.
On the commodities markets, the trend was mostly higher across the board today for the Energy sector: Light crude moved higher by $0.11 to close at $61.50 a barrel; Heating Oil closed with higher by $0.02 to end the day at $1.77 a gallon; Natural Gas moved lower by $0.17 to end the day at $7.53 per million BTU and Unleaded Gas closed higher by $0.02 today to end the session at $1.85 a gallon.
Metals Market ended the session mostly lower across the board today: Gold moved lower by $2.60 to close at $687.20 an ounce; Silver closed lower today by $0.14 at $14.69 an ounce; Platinum moved nicely higher today by $11.30 to close at $1,253.30 an ounce and Copper ended the day lower by $0.05 to close at $2.83 per pound.
On the Livestock and Meat Markets, the trend was mostly higher across the board today: Lean Hogs closed higher by 0.55 to close at 67.43 Pork Bellies ended the day lower by 1.15 to close at 103.15; Live Cattle closed higher by 0.11 to end the day at 97.40 and Feeder Cattle ended the day higher by 0.48 to close at 104.28.
Other Commodities: Corn moved strongly lower today by 14.25 points to end at 424.25 and Soybeans moved much lower today by 15.00 to close at 779.50.
The end of day results for the CBOT (Chicago Board of Trade) which is comprised of the total Exchange Volume for Futures and Options (EVFO) including Electronic, Open Auction and Cash Exchange ended the day at 6,893,496 Open Interest for Futures moved higher by 41,660 to close at 9,545,430 and the Open Interest for Options moved higher by 189,423,161 to close at 5,949,538 for a total Open Interest of 15,496,418 for a total loss on the day by 231,083.
Bonds were nicely higher across the board again today: 2 year bond closed higher by 11/32 at 100 10/32; 5 year bond closed higher by 24/32 at 100 25/32; 10 year bond closed higher by 1 1/32 at 10 and the 30 year bond closed higher by 1 14/32 at 101 23/32.
The mini Dow ended the session today with a heavy loss of 403 to close at 12251. The total Dow Exchange Volume for the day came in at 108,408 which are comprised of Electronic, Open Auction and Cash Exchange. Traders should review workshops available at the CBOT (Chicago Board of Trade) Educational in-person seminars schedules available on CBOT (Chicago Board of Trade) website.