Bear Market
Almost all markets went sideways today – awaiting the words of wisdom from the FED tomorrow.
The currency markets picked up on the weak consumer confidence number announced today.
In the news today…..
Housing prices dropped 1.4% in April, or 15.3% annually as a national figure. The fall in price seems to be slowing nationally, as it appears the pace of the falling price is slowing. Why would this be?? My guess is that the foreclosures are slowing, but don’t worry, they’ll pick up again later this year. 13 of the top 20 metro areas had record low prices. Miami and Phoenix were the biggest fallers – both 3% in the month of April. There is now talk about a “vicious cycle” in housing prices as prices go down because of foreclosures, and the lower prices cause more foreclosures. I’m thinking that news writers are really “slow” mentally to only be picking this up now. This should be no surprise to EconomyGuy readers as we’ve talked a lot about this happening, and it is happening in “worst” markets.
Consumer Confidence fell to its lowest level in 16 years during June. This is expected to get worse, and this prediction is coming from the consumers themselves. Is this a self-fulfilling prophecy?
US Corporate profits are falling about 10% overall (S&P companies). Guess what this means for stocks??? A few months ago, it stated that stocks were in a BEAR market according to DOW Theory. This last week’s actions continue to confirm that as major trend lines are being broken on the downside. I hope you are not in the general market, and if you absolutely must be in stocks, that you carefully picks places that will over perform such as energy, commodities, etc.
Here are today’s numbers:
Dow Jones 30 Industrial - 11,807 (down 35 points)
10 Year Treasury Bond - 4.11% (down 0.06%)
Euro - $1.5569
Gold - $892 (up $4)
Oil - $137.00 (up $0.26)
Gasoline - $3.46 (up $0.01)
