Bear Mountain Bull

It’s time again for a little BMB R&R, especially with the market behaving as bizarrely as it’s been. Maybe if we stop watching it start to behave a little better…

Posting will be very light and variable over the course of this week, but we’ll put up an open thread each market day for our readers to comment on the day’s market activity or to post any interesting links they might run across.

Check the space below for whatever the latest might be during this ‘off’ time, and please visit the various sites in the ‘Links’ and ‘Regular Stops’ for up-to-date market news and analysis.

BMB will be back in full swing by next weekend.

As a follow-up to BMB’s post on the housing sector over the weekend, take a look at these charts and see if you see a pattern developing — note the break of the uptrend and the violation of both the 50-day and 200-day moving averages. All three are components of the HGX housing index:

	Pulte Homes is the homebuilder that warned of its troubles in the Las Vegas market a couple of weeks ago.
	American Standard is a supplier of both air conditioning systems and bath and kitchen fixtures.
	Temple-Inland is a provider of building supplies, including lumber and gypsum wallboard.

Charts courtesy of StockCharts.com

The Dow Jones Industrial index, easily the weakest of the major indices at this point, has breeched its May lows and now looks to test its low readings of the year, set in early August.

Chart courtesy of StockCharts.com

What started out looking like a good day for the bulls took a turn down midday and just continued to worsen. Oil stopped its slide around the $52.60 mark and began to rebound, and news that NY AG Spitzer’s reach was wider than originally known cast a dark shadow on the markets.

All the major indices finished down less than 1% on average volume, but the S&P got the worst of it (since many of the HMO type stocks that got hit aren’t in the Dow or on the Nasdaq), finishing down 0.97%. Decliners led advancers by just under 2 to 1, up volume/down volume ran about 3:7 on the NYSE and just below even on the Nasdaq. With the morning run up, there were about twice as many new highs as new lows.

Breaking down the industries, damage was widespread with paper down 3%, hospitals and insurance down more than 2%, and chemicals, health care, banks, biotechs and network stocks all down more than 1%. On the up side, only the retailers and semiconductors managed gains of more than 1%, with the broker/dealers just short of that mark.

Looks like the HMOs could be getting hit too.

Whether you believe them or not, the consumer price numbers were released this morning. So how many more months will actually see energy prices decreasing? But of course, energy costs aren’t part of the core inflation number anyway. Neither is food. BMB believes that’s because so few people actually eat food or use energy of any kind.

Some key chart levels to keep an eye on.