1-23-09

1.23.09

            Stocks lost more ground during this holiday-shortened week. That is now three weeks in a row. Tuesday was a historic day for politics with the inauguration of President Barack Obama but it was a day to forget for investors as stocks moved markedly lower due to steep losses in the financial sector. Citigroup shares fell 20% on the day while The Royal Bank of Scotland lost 69% of its market value after it warned that it may report a loss in excess of $40 billion. The main indices fell all day, with the Nasdaq Composite diving 5.8%. After the close, IBM reported solid quarterly earnings results and issued a positive outlook for the year. The news helped turn the mood around Wednesday, as stocks experienced a sharp rebound that almost erased Tuesday's big decline. Tech stocks led the market lower Thursday, after Microsoft missed its quarterly earnings and revenue targets and announced that it will shed 5,000 jobs. The software giant's stock lost 12% during the session and contributed to a 2.8 drop for the Nasdaq Composite. It was then Google's turn to report its quarterly results and the company did not disappoint as it beat expectations. The news helped the tech sector move higher Friday while a rebound in energy and financial stocks resulted in a 0.54% daily gain for the S&P 500.

            The Nasdaq 100, S&P 500 and Russell 2000 respectively lost 1.77%, 2.29% and 4.50% on the week. All 3 remain below both their 50-day and 200-day exponential moving averages.

             We remain 100% in CASH as we await next week’s earnings reports of around 135 SP500 companies that are due to report. As you can see, any big name stock can move the market either way in the current environment.

   Till next time

   The MTA Staff