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December 02, 2005
The Gap, Gas and Retail Sales, December, US Dollar not afraid of ECB plus GE, SYMC, CSCO, SIRI, HPQ and WMT.
Stocks opened strong and closed strong. Thursday’s gap is bullish until proven otherwise (filled). It is as simple as that.
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Barry Ritholtz (http://bigpicture.typepad.com/comments/) is bullish on retail sales because of falling gas prices.
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From the Capital Speculator (www.capitalspectator.com): The dollar has found a reprieve in the last three months, in part due to the stillness that has characterized the monetary policy of the European Central Bank. The ECB has kept the Continent's benchmark rate at 2% for the last 30 months while the Fed has incessantly raised the price of money since June 2004 to the current 4.0%, thereby creating a tidy premium in dollar assets over euro-based counterparts. The Capital Speculator notes: Although that premium isn't about to evaporate any time soon, the ECB may start lifting rates, giving dollar bulls new reason to worry.
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I will not be impressed with Cisco unless it can break 18.
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SIRI also failed to partake in the rally and closed below its open.
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GE failed to partake and closed below its open.
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HPQ failed to partake yesterday and actually gapped down. Hmm….
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Steve Todd of the Todd Market Forecast (www.toddmarketforecast.com) notes: Let's talk December. In the 56 years since 1949, the 12th month has been up 41 times and down 15 for a batting average of 73%. The average gain has been 1.8% which makes it the best month in Dow terms over the past half century. If the other months had done as well, the average yearly gain would have been 23%.
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SUNW announced that it will bundle much of its software and offer it for free to customers. This is all about eliminating the barriers to revenue, said Sun Chief Operating Officer Jonathan Schwartz in a telephone interview. Sounds like a way to eliminate revenue altogether!
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Microsoft will make its Windows OneCare Live "computer health" service available to all comers for free in a "beta" test designed to see how well it works on a massive scale of potentially millions of consumers. Microsoft plans to support OneCare with a monthly subscription fee once it is formally launched some time next year. Look out Symantec.
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AP Reports that Wal-Mart Stores Inc. (WMT) charged the wrong price to shoppers in California and the Midwest at a rate that exceeds those set by federal guidelines, according to two union-commissioned university studies released Monday. Researchers said random purchases at 60 Wal-Mart stores in California found that the wrong price came up 8.3% of the time. At 78 stores in Illinois, Indiana and Michigan, check-out scanners rang up the wrong price 6.4% of the time. In both states, some prices rang up higher and some were lower.
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The Wall Street Journal reports that the ECB is expected to raise rates by a quarter point to 2.25%, the European bank's first rate increase in five years. The ECB move is prompting some strategists to advise shifting from European to U.S. stocks. Euro can hardly grow as it is and a rate increase is the last thing needed.
Posted by Arthur B. Hill at December 2, 2005 06:15 AM