Bear Mountain Bull

Another mixed-up, mashed-up mess. We should have expected as much, considering it was a short, pre-holiday session

Indices were all over the place during the day, finishing mixed. Though the Dow was up 73 points, A/D lines were still pretty red and the Russell dropped the equivalent of 110 Dow points. So was it a good day or a bad day? Looks to me like it was more bad than good.

Here are the final scores:

Treasuries were mixed, with little change in yields:
6-month: 2.03%    2-yr: 2.52%    5-yr: 3.27%    10-yr: 3.97%    30-yr: 4.53%.

The Dow may have been green, but internals remained red. Advances/declines were 1 to 2 on the NYSE and 2 to 3 on the Nasdaq, with up/down volume 2 to 3 on the NYSE and 11 to 21 on the Nasdaq. New highs were a joke: highs/lows were 1/425 on the NYSE and 7/353 on the Nasdaq. Yes, you read that right - 8 new highs, and only 1 on the NYSE.

The gains in the indices were a bit of smoke and mirrors, considering that there were more losing groups than winning ones, and the only group to gain more than a percent was the drug stocks (+1.9%). Leading the losers’ column were the HMOs (-3.1%), natural gas stocks (-2.7%), disk drives (-2.6%), oil services (-1.7%), metals and mining (-1.3%) and the banks (-1.2%).

Energy prices were higher yet again. Crude set more records, closing at $144.35/barrel. Gasoline picked up a pennty to $3.56/gallon, and natural gas moved back up to $13.48/mmBTU. The Euro-heavy dollar index rallied after the ECB finally made its call, moving up to 72.76. That pulled the PMs back a bit, with spot gold dropping to $933/ounce and silver to $18.22/ounce.

BMB Note:   I don’t give much weight to shortened days like today, but it looked to me that even despite the gains in the Dow, the broader market was still fairly weak. We’ll find out more after the long weekend.

BMB will be enjoying a little time off since the markets will be closed. For all those in the US, have a great Independence Day, and for those that may be checking in from other countries, have a great Friday!

We’ll see you all on the weekend.

I’m not too sure how meaningful today’s action will be, being a shortened pre-holiday session - markets close at 1PM Eastern.

But the Dow has already seen a range of over 130 points from top to bottom this morning, bouncing all over the place. The indices are currently mixed, with A/D lines in the red. The groups show more red than green, with drug stocks, retail and internets leading the winners, while HMOs, natural gas stocks, metals, steel and gold and silver stocks lead the losers.

Treasuries are mixed. Energy prices are slightly higher. The dollar index took a morning jump, gold and silver are lower.

I know you probably get tired of BMB’s griping about how lousy government numbers are. But let’s face it: they ARE lousy. And if the public ever gets tired of being fed garbage, maybe some changes will eventually be made - but I won’t be holding my breath…

The Big Picture on this morning’s NFP report:

THE EMPLOYMENT SITUATION:  JUNE 2008 

BLS:

Nonfarm payroll employment continued to trend down in June (-62,000), while the unemployment rate held at 5.5 percent, the Bureau of Labor Statistics of the U.S. Department of Labor reported today.  Employment continued to fall in construction, manufacturing, and employment services, while health care and mining added jobs. Average hourly earnings rose by 6 cents, or 0.3 percent, over the month.

NFP payrolls shrank for the sixth consecutive month.

The big news was the revisions — down another 52,000 for April and May. When we get these revisions next month for June, don’t be surprised if we see a major change.

Also, note the Unemployment Claims jumped to 404k . . .

And now, the Birth Death Adjustment:

June 2008 was 177k versus June 2007 155k
Construction Gains +29k
Professional & Business Services +22k
Leisure and Hospitality +86k

The last is my favorite: Given the massive decrease in travel, an 86k gain in this sector is very hard to believe…

The two biggest items out this morning are probably the ECB’s rate hike (Sweden’s central bank also raised their key rate) and the government’s excuse for a jobs tally.

Index futures are pointing to a higher open - probably more of a result of oil’s early pullback from above the $145 mark than anything else.