FalconStor Software (Nasdaq: FALC) - The Biggest Loser

The Biggest Loser is a new column we are launching to discuss the most significant market capital loser of the day. On this inaugural edition, The Biggest Loser is FalconStor Software (Nasdaq: FALC).

Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.

(Tickers: Nasdaq: APRI, Nasdaq: GMCR, Nasdaq: OLCB, Nasdaq: BYFC, Nasdaq: MLNK, Nasdaq: PDEX, NYSE: ZZ, Nasdaq: RFIL, Nasdaq: CPSL, OTC: TXICW.OB, NYSE: SAY, Nasdaq: HFFC, Nasdaq: CARV, Nasdaq: OSBC, Nasdaq: MSHL, Nasdaq: CNST, AMEX: IOT, Nasdaq: VSCI, NYSE: AM, Nasdaq: ENMD, Nasdaq: FSGI, Nasdaq: CSHB, NYSE: ATU, NYSE: AM, Nasdaq: CPSL, NYSE: FDO, NYSE: OMN, NYSE: SNX, NYSE: WOR, Nasdaq: XRTX, NYSE: FDX, Nasdaq: AMSF, NYSE: DHI, NYSE: MFA, NYSE: VR, NYSE: WFC, NYSE: ABG, Nasdaq: DENN, Nasdaq: JACK, NYSE: MRT, Paris: BNP.PA, NYSE: CS, NYSE: EXC, NYSE: PGN, NYSE: F, NYSE: UBS, NYSE: KRA, NYSE: URI, NYSE: DIA, NYSE: SPY, Nasdaq: QQQQ, NYSE: DOG, NYSE: SDS, NYSE: QLD, NYSE: NYX, NYSE: ICE, Nasdaq: NDAQ)

FalconStor Software (Nasdaq: FALC) - The Biggest Loser

The day's biggest loser was FalconStor Software (Nasdaq: FALC), which dropped 22.4% Wednesday, after the abrupt resignation of Chairman, CEO & President ReiJane Huai. The reason behind the CEO's resignation was the key driver behind the collapse of the stock. But, what should shareholders and prospective shareholders do now? With an investigation still underway, that's not an easy question to answer.

FalconStor's official statement read:

"Mr. Huai tendered his resignation following his disclosure that certain improper payments were allegedly made in connection with the Company's contract with one customer. The Company has fully cooperated with law enforcement authorities with respect to the ongoing investigation, and it will continue to do so. In addition, a special committee of the Board has been formed to conduct a full internal investigation of these matters and the special committee has retained counsel to assist it in its investigation."

The company also announced these changes to its management team:

Eli Oxenhorn (board member) to non-executive Chairman of the Board
James McNiel (Chief Strategy Officer) to Interim CEO and President
James Weber (Chief Financial Officer) to CFO & Interim COO

The question for shareholders who withstood the storm today and for prospective shareholders is buy, sell or hold?

The answer to that question lies in several factors. First and foremost, there is an investigation underway that threatens to turn up more dirt. As an analyst, I learned to give respect to the possibility of another shoe dropping, and given the universe of stocks to choose from, why would a new shareholder risk touching FalconStor now? And I do not like the shift in management, unless we later learn it was a one man mistake. Too many of the old team remain in place to investigate the alleged crime for my comfort, but the news is still breaking.

The reason why someone might risk it is that the alleged criminal activity might be relegated to a certain individual or handful of individuals and might not threaten ongoing operations. If that were the case, then perhaps the stock might quickly regain the ground it lost today. But even if this is the case, now is probably not the time to buy in. The dirt is still turning up and shareholders remain more likely to sell than to buy. That is unless the story of the company or its product is much bigger than this scandal. That is only something that further detailed analysis can discover. And the question of the value of the company's assets comes into focus as well, and whether that might set a floor or whether an acquisition multiple might.

I can only comment lightly, since this is my first exposure to the company. What I note off the bat is that the earnings outlook is one that has deteriorated over the last quarter. Also, the growth outlook is a slower one than what the company has accomplished in recent years.

The stock's biggest shareholder is the guy who just retired from its operation. It also has a few interesting fund holders at Vanguard and Gabelli. The two analysts who cover the company appear to have not had a change in opinion in over a year or more (based on Yahoo Finance data). It is possible they have some tie to its capital raising efforts, or are following to serve the institutional ownership that exists already. Whatever the case, the analytical coverage is not impressive to me.

The stock has been in the dumps since the middle of 2008. The chart is not telling me anything good, except for the fact that the shares stabilized today after diving to as low as $2.63. FALC closed at $3.15 after trading flat from 1:30 PM or so.

My Call:

I would probably hold the shares if I owned them already, and not touch them if I were new to the story.

The Rest of the Day's Loser List Included:

Apricus Biosciences (Nasdaq: APRI): -18.8%
Green Mountain Coffee Roasters (Nasdaq: GMCR): -16.1%
Ohio Legacy (Nasdaq: OLCB): -16%
Broadway Financial (Nasdaq: BYFC): -14.3%
ModusLink Global Solutions (Nasdaq: MLNK): -13.7%
Pro-Dex (Nasdaq: PDEX): -12.5%
Sealy Corp. (NYSE: ZZ): -11.5%
RF Industries (Nasdaq: RFIL): -11%
China Precision Steel (Nasdaq: CPSL): -10.2%
Tongxin International (OTC: TXICW.OB): -10.2%
Satyam Computer (NYSE: SAY): -10.1%
HF Financial (Nasdaq: HFFC): -10.1%
Carver Bancorp (Nasdaq: CARV): -9.9%
Old Second Bancorp (Nasdaq: OSBC): -9.7%
Marshall Edwards (Nasdaq: MSHL): -9.7%
Constar International (Nasdaq: CNST): -9.5%
Income Opportunity Realty Trust (AMEX: IOT): -9.5%
Vision-Sciences (Nasdaq: VSCI): -9.4%
American Greetings (NYSE: AM): -9.2%
EntreMed (Nasdaq: ENMD): -8.9%
First Security Group (Nasdaq: FSGI): -8.8%
Community Shores Bank (Nasdaq: CSHB): -8.7%

In other corporate news, EPS were reported by Actuant (NYSE: ATU), American Greetings (NYSE: AM), China Precision Steel (Nasdaq: CPSL), CKE Restaurants (CKE.F), Family Dollar (NYSE: FDO), OMNOVA Solutions (NYSE: OMN), SYNNEX (NYSE: SNX), Worthington Industries (NYSE: WOR) and Xyratex (Nasdaq: XRTX).

FedEx (NYSE: FDX) met with analysts. The JMP Securities LLC Financial Services and Real Estate Conference offered presentations by Amerisafe (Nasdaq: AMSF), D.R. Horton (NYSE: DHI), MFA Financial (NYSE: MFA) and Validus Holdings (NYSE: VR). The Wells Fargo Securities Consumer Conference (NYSE: WFC) brings presentations by Asbury Automotive (NYSE: ABG), Denny's (Nasdaq: DENN), Jack in the Box (Nasdaq: JACK), and Morton's Restaurant Group (NYSE: MRT). The Bank of America Merrill Lynch Banking & Insurance Conference brought news from BNP Paribus (Paris: BNP.PA) and Credit Suisse (NYSE: CS). The Bank of America Merrill Lynch Power & Gas Leaders Conference offered presentations by Exelon (NYSE: EXC) and Progress Energy (NYSE: PGN). Ford Motor Company (NYSE: F) appeared at the Paris Auto Show UBS Investor Conference (NYSE: UBS). The Oppenheimer & Co. Industrials Conference offered news from Kraton Performance Polymers (NYSE: KRA) and United Rentals (NYSE: URI).



Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

Income or Yield Reach in 2010?

In his latest piece, our Real Estate Columnist Michael Douville says retired investors need not "reach" for yield at the peril of capital. He says, instead investors can find reliable and strong income that is within reach in the residential real estate market in 2010 and 2011.

Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.

(Tickers: NYSE: BAC, OTC: FMCC.OB, OTC: FNMA.OB, NYSE: GS, NYSE: MS, NYSE: WFC, NYSE: TD, NYSE: PNC, NYSE: SRS, NYSE: URE, NYSE: IGR, NYSE: XIN, Nasdaq: RYHRX, Nasdaq: TRREX, NYSE: TOL, NYSE: HOV, NYSE: DHI, NYSE: BZH, NYSE: LEN, NYSE: KBH, NYSE: PHM, NYSE: NVR, NYSE: GFA, NYSE: MDC, NYSE: RYL, NYSE: MTH, NYSE: BHS, NYSE: SPF, NYSE: MHO, AMEX: OHB, NYSE: VNQ, Nasdaq: AVTR, NYSE: AIV, NYSE: EQR, NYSE: AVB, NYSE: UDR, NYSE: ESS, NYSE: CPT, NYSE: SNH, NYSE: BRE, NYSE: HME, NYSE: MAA, NYSE: ELS, NYSE: ACC, NYSE: CLP, Nasdaq: AGNC, NYSE: SUI, NYSE: AEC, NYSE: PMT, AMEX: TWO, NYSE: DIA, NYSE: SPY, Nasdaq: QQQQ, NYSE: DOG, NYSE: SDS, NYSE: QLD)

Income or Yield Reach in 2010?

Income! The Retired, Semi-Retired, Newly-Retired, and Soon-to-be-Retired have a common problem: the bills need to be paid every month!!! Plans and budgets need to be drafted and drawn. A consistent source of monthly income is crucial to successful retirement planning. A growth portfolio of stocks can produce capital gains, but in order to keep the utility company satisfied or plan for a cruise, a portion of the portfolio would have to be liquidated each month. Unfortunately, relying on consistent capital gains has recently been proven to be a losing game. In addition, stock portfolios have been further exacerbated by the volatility of 200 points up on Monday and 220 down on Wednesday.

The volatility and the inability to assess risk have driven many retail investors out of the stock market and into fixed income. The income investor seeking a conservative and consistent revenue stream has created a very crowded trade in US Treasuries. Yields have dropped to insignificant levels… 10-year Treasuries are yielding in the mid 2% range. Often these instruments are bought by investors seeking a safe harbor in turbulent times; at this historic inflection point, the exact opposite may be the result. Should the economy collapse, Treasuries will still perform exceptionally well. If the economy shows any sign of recovering, the bond market will likely suffer severe losses.

The greatest threat to a retired investor is market losses. Many investors are of an age that has no capacity to recover and replenish depleted portfolios. Their life style and perhaps more will suffer if caught in another market bubble burst. The deployment of their financial resources is a very serious issue; consistent income without the depletion of capital is the goal of SWAN Investors (Sleep Well At Night).

Monthly income from Pensions, 401K's, and Social Security have been traditionally supplemented by the interest earnings of the families' liquid nest eggs, which have been accumulated over a life time of savings. No longer can individuals earn any significant amount from bank savings accounts or CDs that are currently earning less than 1%; liquid money markets earn less than 0.5%, causing conservative investors to move into instruments that have longer duration and poorer credit quality. And they do this to earn an extra $500, $1000, or $2000 per month. The consequences may prove disastrous.

"...the perceived safe and conservative investment may prove to be anything but safe and secure."

This "Yield Reach" has caused many closed end mutual funds and ETFs to be priced with Net Asset Value (NAV) premiums of 10%, 15%, and even 20% in some cases, over true asset liquidation prices. Should investors start to exit these assets, the prices would likely fall precipitously, in my view. With yields at historic lows, the path of least resistance may be up. With price declining as yields increase, both the disappearance of the NAV premium and the adverse market reaction could conceivable combine to produce losses of 10-50%. Thus, the perceived safe and conservative investment may prove to be anything but safe and secure.

With the volatility of the equity markets, and the possible bursting of the "Bond Bubble," where can a monthly revenue stream be obtained that, when the economy eventually recovers, will grow the revenue and increase in value? Residential Rental Real Estate today should provide consistent monthly income. I expect its cash flow and the severe price decline recently experienced in the Real Estate market would help to mitigate potential risk.

Not all properties make suitable investment grade rentals. However, in most markets across the US there are properties that have experienced a severe correction and may even be priced below insurance industry replacement value. The risk of further declines is possible, but that risk has been mitigated by the recent depreciation in value, and so we may be closer to the ultimate bottom than near a historic top. Long-term mortgage rates favor today's borrower, and when the recovery is firmly established, the loan costs will still be fixed, but the rental rates will trend higher, increasing the cash flow. As the economy grows, the income stream also grows. The nature of a common fixed rate loan fully amortized over 30 years should now guarantee internal growth, with the ultimate result of a free and clear property that will generate income year after year. No additional market action is necessary. Further, a simple amortizing mortgage with which everyone is familiar, can be customized easily to fully payoff in 10, 15, or 20 years.

No more market volatility to worry about; no more technical analysis needed; no more "Island Tops" and "Head and Shoulders"; no more market openings that gap below the stop order. Instead, a true long-term investment that I expect guarantees huge returns; the tenants will pay the mortgage off and produce free and clear assets with consistent monthly cash flow.

In my home market of Phoenix, Arizona the sun continues to shine, golf is played every day, and rental properties continue to generate cash flow well. Investors remain investors and hire property managers to be the landlord; the property becomes a passive investment vehicle yielding cash flow month after month.

As in any portfolio, diversification is appropriate and only a portion of an investor's total assets should be in Real Estate. As difficult as the Real Estate Market has been across the nation, a suitable property can probably be found close to home; if not, then it can be found in the Sand States of Arizona, California, Florida, and Nevada, which I view ripe. If you believe the largest economy and richest nation in the world will eventually recover, then an enormous opportunity should await.



Editor's Note: Article should interest investors in Bank of America (NYSE: BAC), Freddie Mac (OTC: FMCC.OB), Fannie Mae (OTC: FNMA.OB), Goldman Sachs (NYSE: GS), Morgan Stanley (NYSE: MS), Wells Fargo (NYSE: WFC), Toronto Dominion (NYSE: TD), UltraShort Real Estate ProShares (NYSE: SRS), Ultra Real Estate ProShares (NYSE: URE), ING Clarion Global Real Estate Income Fund (NYSE: IGR), Xinyuan Real Estate Co. (NYSE: XIN), Rydex Real Estate Fund H (Nasdaq: RYHRX), T. Rowe Price Real Estate Fund (Nasdaq: TRREX), Toll Brothers (NYSE: TOL), Hovnanian (NYSE: HOV), D.R. Horton (NYSE: DHI), Beazer Homes (NYSE: BZH), Lennar (NYSE: LEN), K.B. Homes (NYSE: KBH), Pulte Homes (NYSE: PHM), NVR Inc. (NYSE: NVR), Gafisa SA (NYSE: GFA), MDC Holdings (NYSE: MDC), Ryland Group (NYSE: RYL), Meritage Homes (NYSE: MTH), Brookfield Homes (NYSE: BHS), Standard Pacific (NYSE: SPF), M/I Homes (NYSE: MHO), Orleans Homebuilders (AMEX: OHB), Vanguard REIT Index ETF (NYSE: VNQ), PNC Bank (NYSE: PNC), J.P. Morgan Chase (NYSE: JPM), Hooker Furniture (Nasdaq: HOFT), Ethan Allen (NYSE: ETH), Pier 1 Imports (NYSE: PIR), Williams Sonoma (NYSE: WSM), Home Depot (NYSE: HD), Lowes (NYSE: LOW), AMEX: VAZ, AMEX: NKR, AMEX: MZA, AMEX: NXE, AMEX: NFZ, Nasdaq: XNFZX, Nasdaq: FSAZX, Avatar Holdings (Nasdaq: AVTR), Apartment Investment & Management (NYSE: AIV), Equity Residential (NYSE: EQR), Avalonbay Communities (NYSE: AVB), UDR Inc. (NYSE: UDR), Essex Property Trust (NYSE: ESS), Camden Property Trust (NYSE: CPT), Senior Housing Properties (NYSE: SNH), BRE Properties (NYSE: BRE), Home Properties (NYSE: HME), Mid-America Apartment (NYSE: MAA), Equity Lifestyle Properties (NYSE: ELS), American Campus Communities (NYSE: ACC), Colonial Properties (NYSE: CLP), American Capital Agency (Nasdaq: AGNC), Sun Communities (NYSE: SUI), Associated Estates (NYSE: AEC), PennyMac Mortgage (NYSE: PMT), Two Harbors (AMEX: TWO).

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

Free Cup of Coffee for National Coffee Day

This article is all about getting you your free cup of coffee for National Coffee Day. You'll find the important information on how to get that free coffee down the page, and so go get your cuppa jo!

Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.

(Tickers: Nasdaq: PEET, Nasdaq: GMCR, Nasdaq: SBUX, NYSE: MCD, Nasdaq: JAVA, NYSE: THI, Nasdaq: HAIN, Nasdaq: JMBA, Nasdaq: JSDA, NYSE: JVA, Nasdaq: JAVO, NYSE: UN, NYSE: DIA, NYSE: SPY, Nasdaq: QQQQ, NYSE: DOG, NYSE: SDS, NYSE: QLD, NYSE: NYX, NYSE: ICE, Nasdaq: NDAQ)

Free Cup of Coffee for National Coffee Day

The stock market is open on National Coffee Day, in case you were wondering or were like Kramer from Seinfeld and thought you should have off on Arbor Day and such. Well, since it is National Coffee Day, and because we have a column we like to call "Today's Coffee," and given the dearth of economic reports today, we thought we would give you a special Coffee article, and directions to where to get that free cup of Jo today.

It's true, by the way. It really is National Coffee Day, a day in which we honor coffee, and drink it up manicly like usual of course. I drink at least four cups a day, after cutting back due to hallucinations.

Unfortunately, there will be no coffee shop hop today, like the annual bar hopping fun that occurs in my Upper East Side neighborhood every St. Patrick's Day, but there are a few retailers offering special deals and even free cups of coffee for the hooked on this very special holiday. Take advantage of it dear friends, and get some of your hard earned money back from the servers of our addiction.

The most important thing about National Coffee Day is that you can score yourself a free cup across the country if you are smart. I would look for more if I were you, but here are the free coffee deals we found for today:

• LaMars Donuts and Coffee – Get a free 12 ounce coffee on September 29th when presenting this free printable coupon at participating locations.


• Dunkin' Donuts – Stop by participating Dunkin' Donuts and receive a free cup of coffee. The company will also donate a portion of their sales to Special Olympic groups.


• Boca Java – Boca Java is offering free shipping today in honor of the holiday. Come on! You can do better than that!


• Java Café – Java Café will offer drinks at a 50 percent discount from 7 A.M. – 12:00 P.M. on the 29th.


• Starbucks – Nada! No! You won't get a free cup from Starbucks today according to every source I checked, including their website (Nasdaq: SBUX).


• McDonald's – No free deal from McDonald's either! Talk about missing an opportunity! I'm a little p'd at McDonalds these days, after they tried to charge me $1.40 for a cup the other night, even though I ordered food. Come on McDonald's. We want Greek friendly service. (NYSE: MCD)


• Tim Horton's - No Deal!!! (NYSE: THI)


• Peet's Coffee & Tea (Nasdaq: PEET): Saw no special deals!!!


• Green Mountain Coffee Roasters – No deal as far as we can see, and the company is in trouble with the SEC today too; the shares are down some 14%. Yikes!

Not all locations will be participating in the free or discounted offer. Call ahead or check the website for details.

The Mayo Clinic published this bit of relevant information for coffee lovers who care about how much caffeine their cuppa joe (Canadian editorial - we employ all sorts) contains:

1. Dunkin' Donuts, brewed, 16 oz (480 mL) 143-206
2. Generic brewed, 8 oz (240 mL) 95-200
3. Generic brewed, decaffeinated, 8 oz (240 mL) 2-12
4. Generic instant, 8 oz (240 mL) 27-173
5. Generic instant, decaffeinated, 8 oz (240 mL) 2-12
6. Starbucks Espresso, 1 oz (30 mL) 58-75
7. Starbucks Vanilla Latte, 16 oz (480 mL) 150

So that's why I like Dunkin' Donuts coffee so much! (will accept money from DD for this, or coffee I guess). By the way, The Greek has yet to decide on his favorite brand of Greek Coffee... Send Coffee!



Article interests investors in Nasdaq: PEET, Nasdaq: GMCR, Nasdaq: SBUX, NYSE: MCD, Nasdaq: JAVA, NYSE: THI, Nasdaq: HAIN, Nasdaq: JMBA, Nasdaq: JSDA, NYSE: JVA, Nasdaq: JAVO, NYSE: UN, NYSE: PEP, NYSE: GIS, NYSE: KO, NYSE: K, NYSE: CPB, NYSE: MJN, NYSE: CAG, NYSE: SLE, NYSE: SJM, NYSE: MKC, NYSE: RAH, NYSE: CPO, NYSE: DLM, NYSE: FLO, NYSE: DHS, NYSE: THS, Nasdaq: DMND, NYSE: GMK, Nasdaq: JJSF, Nasdaq: LNCE, NYSE: BGS, Nasdaq: FARM, Nasdaq: SMBL, Nasdaq: CMFO, Nasdaq: MGPI, Nasdaq: JBSS, Nasdaq: FEED, Nasdaq: CNGL, NYSE: OME, NYSE: ALN, NYSE: OFI, Nasdaq: KTEC, Nasdaq: SNAK, Nasdaq: TSTY, NYSE: FRZ, Nasdaq: GLDC, NYSE: NWD.

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

Political Fervor Taints Consumer Confidence Numbers

Tainted Tea & the Confidence Numbers

While The Greek is concerned about the significant decline in consumer confidence, something we have been warning would threaten the housing market and the general economy, we also smell a rat in the survey. Consumers have good reason to be troubled, don't get me wrong, but seasonal factors may be playing a role now as well. One such seasonal is of the irregular sort, and of political taint.

Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.

(Tickers: NYSE: XRT, NYSE: WMT, NYSE: PIR, NYSE: ETH, Nasdaq: HOFT, NYSE: HD, NYSE: LOW, Nasdaq: AAPL, NYSE: BBY, NYSE: LTD, NYSE: CHS, NYSE: ANN, NYSE: GPS, NYSE: M, NYSE: JCP, NYSE: JWN, NYSE: TJX, NYSE: KSS, Nasdaq: COST, NYSE: TGT, NYSE: WMT, Nasdaq: WTSLA, Nasdaq: HOTT, NYSE: AEO, NYSE: ARO, NYSE: ANF, NYSE: SAK, NYSE: TIF, NYSE: TLB, NYSE: LL, Nasdaq: BLDR, NYSE: FO, NYSE: LEG, NYSE: TPX, NYSE: AYI, NYSE: LZB, Nasdaq: SCSS, NYSE: ZZ, NYSE: FBN, NYSE: NTZ, Nasdaq: SHLD, NYSE: DDS, Nasdaq: BONT, Nasdaq: CPWM, Nasdaq: BKRS, Nasdaq: BEBE, NYSE: BKE, Nasdaq: CACH, Nasdaq: CMRG, Nasdaq: CATO, NYSE: CBK, Nasdaq: CTRN, NYSE: PSS, Nasdaq: DEST, Nasdaq: DBRN, NYSE: DSW, Nasdaq: FINL, NYSE: FL, Nasdaq: GYMB, NYSE: GES, NYSE: JCG, NYSE: JNY, Nasdaq: JOSB, NYSE: NWY, NYSE: JWN, NYSE: MW, Nasdaq: SYMS, Nasdaq: PLCE, NYSE: DIA, NYSE: SPY, Nasdaq: QQQQ, NYSE: DOG, NYSE: SDS, NYSE: QLD, NYSE: NYX, NYSE: ICE, Nasdaq: NDAQ, NYSE: BAC, NYSE: GS, NYSE: MS, NYSE: JPM, NYSE: C, NYSE: WFC)

Political Fervor Taints Consumer Confidence Numbers

Consumer Confidence sank to a mark of 48.5 in September, according to the Conference Board, which reported the news this morning. The data marked a new low, down from 53.5 in August. In fact, the index has shed 14.2 points since May. Economists were shocked by the degree of depression, with Bloomberg reporting the consensus expectation for the data point at 52.0. Considering that consumer confidence and spending is critical to the US economy, you should be paying close attention to this news.

The Horrible Truth

Consumers have had plenty good reason to sour, including a stagnant and sad labor market. With little new hiring occurring, surely the unemployed are growing increasingly depressed. Depression is certainly a good describer of just how hopeless the survey participants seem to be feeling. Their view of current conditions deteriorated in this latest check, with the Present Situation Index slipping to 23.1, from 24.9 in August. Still, it is their view of the future that should bother you more. The Expectations Index dropped precipitously, to 65.4, from a higher ledge of 72 last month.

The Director of the Conference Board said, "Overall, consumers' confidence in the state of the economy remains quite grim. And, with so few expecting conditions to improve in the near term, the pace of economic growth is not likely to pick up in the coming months." Regarding the present situation, those viewing business conditions as "bad" increased to 46.1%, from 42.3% previously. Only 8.1% said business conditions were "good." With regard to the job market, the number claiming jobs were hard to get depicted a dire environment as well.

Expectations

The American household outlook is indeed grim, and we can find no better descriptor. The percentage of people expecting business conditions to worsen increased, as did the number anticipating fewer job opportunities. This future outlook can have a dramatic impact on spending, because as Americans worry about income and wealth, they will spend cautiously.

Seasonal Impact?

Indeed, back-to-school shopping can have a way of reinforcing the inadequacy of an unemployment check. As such, we expect survey participants were a little more stressed than usual in September.

Conspicuously, we wonder what degree of impact political passions had in influencing the responses of Republican respondents during this special fall month. While things are bad, we can understand easily how worse they can seem by turning on C-SPAN to catch Republican House Leader John Boehner giving a speech. Or, you could switch on Fox television. Active Republican election campaign staffers and simple backers are surely included in the 5,000 households surveyed by the Conference Board, and so as we near November elections, their fervor is no doubt intensified. Perhaps they are also captured in these numbers...

I would assume any self-respecting Republican would express their complete discontent with the state of the economy now, given the other party runs the show today. So, while we see good enough reason for further deterioration in confidence, we warn that there may also be a taint to the tea in this particular reading.



This article should prove interesting to investors in NYSE: PIR, NYSE: ETH, Nasdaq: HOFT, NYSE: HD, NYSE: LOW, Nasdaq: AAPL, NYSE: BBY, NYSE: LTD, NYSE: CHS, NYSE: ANN, NYSE: GPS, NYSE: M, NYSE: JCP, NYSE: JWN, NYSE: TJX, NYSE: KSS, Nasdaq: COST, NYSE: TGT, NYSE: WMT, Nasdaq: WTSLA, Nasdaq: HOTT, NYSE: AEO, NYSE: ARO, NYSE: ANF, NYSE: SAK, NYSE: TIF, NYSE: TLB, NYSE: LL, Nasdaq: BLDR, NYSE: FO, NYSE: LEG, NYSE: TPX, NYSE: AYI, NYSE: LZB, Nasdaq: SCSS, NYSE: ZZ, NYSE: FBN, NYSE: NTZ, Nasdaq: SHLD, NYSE: DDS, Nasdaq: BONT, Nasdaq: CPWM, Nasdaq: BKRS, Nasdaq: BEBE, NYSE: BKE, Nasdaq: CACH, Nasdaq: CMRG, Nasdaq: CATO, NYSE: CBK, Nasdaq: CTRN, NYSE: PSS, Nasdaq: DEST, Nasdaq: DBRN, NYSE: DSW, Nasdaq: FINL, NYSE: FL, Nasdaq: GYMB, NYSE: GES, NYSE: JCG, NYSE: JNY, Nasdaq: JOSB, NYSE: NWY, NYSE: JWN, NYSE: MW, Nasdaq: SYMS, Nasdaq: PLCE, NYSE: BAC, NYSE: JPM, NYSE: GS, NYSE: MS, NYSE: C, NYSE: PNC, NYSE: WFC.

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

Stock Market News 09-28-10

Morning Greek
Greek Factor: -2

We are sorry to be the bearer, but this morning's stock market news wire offered nothing but the bad sort. First and foremost, Consumer Confidence sank well below expectations and is 15 points down from this past May. This drove trading into the ground after the 10:00 AM report release, but stocks have since recovered. This stock market news report also covers all the day's corporate news drivers, the Home Price Index, Investor Confidence Report, international wire, weekly same-store sales data and DC doings.

Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.

(Tickers: NYSE: KO, NYSE: WMT, NYSE: LUV, NYSE: AAI, NYSE: WAG, Nasdaq: ENDP, NYSE: HPQ, NYSE: BKS, Nasdaq: AVSO, AMEX: QBC, Nasdaq: LNDC, Nasdaq: MSII, Nasdaq: MSON, Nasdaq: MLNK, Nasdaq: NSSC, Nasdaq: PDEX, Nasdaq: RLGT, NYSE: ZZ, Nasdaq: SMSC, Nasdaq: SUTR, NYSE: WAG, Nasdaq: ATRC, Nasdaq: CELG, Nasdaq: HALO, NYSE: PMC, NYSE: AWK, NYSE: XEL, NYSE: BAC, NYSE: RBS, NYSE: IGT, Nasdaq: JOSB, NYSE: KBR, NYSE: FLR, AMEX: BKR, NYSE: MWA, NYSE: HIL, NYSE: MDR, NYSE: EME, NYSE: JEC, NYSE: DY, NYSE: GVA, NYSE: WG, NYSE: MTZ, NYSE: CBI, NYSE: ORN, Nasdaq: PRIM, Nasdaq: ACAD, Nasdaq: RURL, Nasdaq: STXS, Nasdaq: VVUS, Nasdaq: SGMO, Nasdaq: MNKD, Nasdaq: VRUS, Nasdaq: OREX, Nasdaq: ARAY, Nasdaq: DCTH, Nasdaq: MYGN, Nasdaq: BIOD, Nasdaq: UPI, NYSE: ALR, Nasdaq: CSII, Nasdaq: KERX, Nasdaq: NGSX, Nasdaq: SLXP, Nasdaq: CYBX, Nasdaq: INHX, Nasdaq: CADX, Nasdaq: CLSN, NYSE: CHE, Nasdaq: ITMN, Nasdaq: AMED, Nasdaq: OSUR, AMEX: SNT, OTC: BNVID, Nasdaq: PENN, NYSE: WEN, Nasdaq: NILE, Nasdaq: GYMB, Nasdaq: PLCE, NYSE: D, NYSE: DUK, NYSE: AEE, NYSE: ED, NYSE: WEC, NYSE: PCG, NYSE: PPL, NYSE: DIA, NYSE: SPY, Nasdaq: QQQQ, NYSE: DOG, NYSE: SDS, NYSE: QLD, NYSE: NYX, NYSE: ICE, Nasdaq: NDAQ)

Stock Market News

We highlighted the importance of the two consumer confidence metrics in our weekly copy published yesterday. We're sorry say the first of the two critical barometers of consumer well-being gave the signal to jump ship today. The Dow has since recovered from its 10:00 AM cue, but we suggest the consumer confidence metric will only garner increasing attention as the day progresses. Home prices are not offering what we would view as good news either, and investor confidence is in the tank as well, based on State Street's report. Thus, the stock market news wire is a bloody one today.

Consumer Confidence
Greek Factor: -2

The Conference Board reported on a deep loss in Consumer Confidence at 10:00 AM ET Tuesday. This September measurement of consumer mood fell well lower than economists' expectations, dropping to 48.5, from 53.5 at last check. Economists expected a mark of 52.0, so this is all-inclusive terrible news (absolute and relative). Worst of all, confidence is down about 15 points since May. Given the importance of the consumer mood on the US economy, this factor is overwhelmingly the most important data point of the day Tuesday and should drive stocks down into the close.

Home Prices
Greek Factor: -1

Redundant as it may be, the S&P Case Shiller Home Price Index was reported this morning for the month of July (and yes we are entering October). Both the 10-City and 20-City Composites showed moderating paces of growth on a year-to-year basis. Growth moderated to 4.1% and 3.2% for the 10 and 20-city measures, respectively. 16 MSAs posted year-over-year increases in price, which (reminding you) was not very hard to accomplish. On a month-over-month basis, sales also moderated on average to 0.8% and 0.6% for the 10-City and 20-City Composites, respectively. 12 of the 20 measured cities posted growth, which means that 8 posted declines in home prices in July.

"A normalized market that includes the absence of government stimuli might also reflect the fact that about 20% of Americans are not earning satisfactory income to spur spending, and banks are not lending to them nor anybody else very easily."

While the economists behind this data hedged by calling for a flattening of home prices, we remind how process works. Just like most economists or people who would like to protect their jobs or reputation, Blitzer and Shiller seem to be simply reflecting the current situation in their analysis (and by current, I mean three months late, based on this data). We suggest investors remember that the laws of momentum typically call for a slowing before a stop and then reversal. A normalized market that includes the absence of government stimuli might also reflect the fact that about 20% of Americans are not earning satisfactory income to spur spending, and banks are not lending to them nor anybody else very easily.

Investor Confidence
Greek Factor: -1

State Street (NYSE: STT) reported on Investor Confidence at 10:00 AM. Investor Confidence fell further in September, to 88.0, from 92.1 in August and 96.5 in July. The news was even worse than the headline indicates, with North American confidence dropping 7.3 points.

ICSC Weekly Sales
Greek Factor: 0

The International Council of Shopping Centers (ICSC) was first to the wire on Tuesday with its regular Weekly Same-Store Sales Report. Sales recovered off a Labor Day impacted comparison from the week before, where sales fell 1.4% week-to-week. We expect future weeks to offer less noisy data, and this week's report covering the period ended September 25 showed a 0.4% weekly gain. Sales were 3.6% higher against the prior year comparable, but look to coming weeks for clearer comps. That said, we may have forgotten some factor from the prior year period here that perhaps weighed on sales in September 2009 (last week also showed 3.3% growth). Redbook showed sales increased 2.5% year-over-year in the latest weekly period.

DC Doings
Greek Factor: -1

In DC, the Senate Budget Committee will examine the outlook for the economy and fiscal policy. This should make for an interesting political scuffle, as Republicans forget their sins of the past and point to Democrats as culprits behind recent deficits. There's a tough political debate in progress now, a fundamental struggle between fiscal prudence posturing and economic stimuli storm trooping. Meanwhile, the Senate Judiciary Committee examines ways to restore anti-fraud and anti-corruption laws post the Supreme Court decision regarding Enron's Jeffrey Skilling.

International Markets
Greek Factor: -1

Dollar/Euro: The British Pound slid Tuesday on a Bank of England (BOE) official's statement pointing to his backing of more asset purchases. The euro rose against the dollar on the news, to its highest level since April. The euro is also still benefiting from rising Federal Reserve concern about the US economy and plans for further stimulus in the US.

Ireland: The Irish government is coming under increased pressure heading into the coming year, as it will likely implement further cuts in its December 7 budget. The Irish are currently awaiting the Central Bank of Ireland's most recent estimate of the cost of restructuring nationalized Anglo Irish Bank Corp. (NYSE: AIB).

North Korean leaders met in a rare gathering that provided some insight into Kim Jung-il's succession plan. He appointed his youngest son to the position of General.

Corporate Drivers
Greek Factor: +1

Coca-Cola (NYSE: KO) announced plans to invest $1 billion in the Philippines over a five year span. KO shares are relatively unchanged on the news. Wal-Mart (NYSE: WMT) proposed the $4.6 billion purchase of South African wholesaler Massmart Holdings, but an important labor group stands opposed to the deal. WMT shares are down fractionally on the potential deal. Southwest Airlines (NYSE: LUV) announced a deal to acquire AirTran Holdings (NYSE: AAI) for $1.4 billion. Both stocks are trading up fractionally on the news. Walgreen's (NYSE: WAG) shares are up nearly 9% on its stronger than expected fiscal quarter numbers. Endo Pharmaceuticals (Nasdaq: ENDP) announced a deal to acquire Quality Pharmaceuticals from Apax Partners for $1.2 billion. Its shares are up +9% on the news.

The corporate news wire covers Hewlett-Packard's (NYSE: HPQ) analyst meeting. Barnes & Noble (NYSE: BKS) shareholders meet to vote on whether to give power to a group of directors headed by investor Ron Burkle. Look for EPS reports from Avatech Solutions (Nasdaq: AVSO), Cubic Energy (AMEX: QBC), Landec Corp. (Nasdaq: LNDC), Media Sciences International (Nasdaq: MSII), Misonix (Nasdaq: MSON), ModusLink Global Solutions (Nasdaq: MLNK), Napco Security Systems (Nasdaq: NSSC), Pro-Dex Inc. (Nasdaq: PDEX), Radiant Logistics (Nasdaq: RLGT), Sealy (NYSE: ZZ), SMSC (Nasdaq: SMSC), Sutor Tech Group (Nasdaq: SUTR) and Walgreen (NYSE: WAG).

JMP Securities LLC Healthcare Focus Conference will feature presentations by Atricure (Nasdaq: ATRC), Celgene (Nasdaq: CELG), Halozyme (Nasdaq: HALO), and Pharmerica (NYSE: PMC), Acadia (Nasdaq: ACAD), Rural/Metro (Nasdaq: RURL), Stereotaxis (Nasdaq: STXS), Vivus (Nasdaq: VVUS), Sangamo BioSciences (Nasdaq: SGMO), MannKind (Nasdaq: MNKD), Pharmasset (Nasdaq: VRUS), Orexigen Therapeutics (Nasdaq: OREX), Accuray (Nasdaq: ARAY), Delcath Systems (Nasdaq: DCTH), Myriad Genetics (Nasdaq: MYGN), Biodel (Nasdaq: BIOD), Uroplasty (Nasdaq: UPI), Inverness Medical (NYSE: ALR), Cardiovascular Systems (Nasdaq: CSII), Keryx Biopharmaceuticals (Nasdaq: KERX), NeurogeseX (Nasdaq: NGSX), Salix (Nasdaq: SLXP), Cyberonix (Nasdaq: CYBX), Inhibitex (Nasdaq: INHX), Cadence Pharma (Nasdaq: CADX), Celsion (Nasdaq: CLSN), Chemed (NYSE: CHE), Intermune (Nasdaq: ITMN), Amedisys (Nasdaq: AMED), OraSure (Nasdaq: OSUR), Senesco (AMEX: SNT), Bionovo (OTC: BNVID).

The Bank of America Merrill Lynch Power & Gas Leaders Conference brings presentations by American Water Works (NYSE: AWK) and Xcel (NYSE: XEL), Dominion Resources (NYSE: D), Duke Energy (NYSE: DUK), Ameren (NYSE: AEE), Consolidated Edison (NYSE: ED), Wisconsin Energy (NYSE: WEC), PG&E (NYSE: PCG), PPL (NYSE: PPL).

The Bank of America (NYSE: BAC) Merrill Lynch Banking & Insurance Conference brings presentation by the Royal Bank of Scotland (NYSE: RBS), Apartment Investment Management (NYSE: AIV), Digital Realty Trust (NYSE: DLR), Home Properties (NYSE: HME), ProLogis (NYSE: PLD).

The Telsey Advisory Group Consumer Conference brings presentations by International Game Technology (NYSE: IGT) and Jos A. Bank Clothiers (Nasdaq: JOSB), Penn National Gaming (Nasdaq: PENN), Wendy's/Arby's (NYSE: WEN), Blue Nile (Nasdaq: NILE), Gymboree (Nasdaq: GYMB), The Children's Place (Nasdaq: PLCE).

The Davidson & Co. Engineering & Construction Conference brings KBR (NYSE: KBR), Fluor (NYSE: FLR), Michael Baker (AMEX: BKR), Mueller Water Products (NYSE: MWA), Hill International (NYSE: HIL), McDermott International (NYSE: MDR), EMCOR (NYSE: EME), Jacob's Engineering (NYSE: JEC), Dycom (NYSE: DY), Granite Construction (NYSE: GVA), Willbros (NYSE: WG), Mastec (NYSE: MTZ), Chicago Bridge & Iron (NYSE: CBI), Orion Marine (NYSE: ORN), Primoris (Nasdaq: PRIM) to the table.



Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

This Week: Testing the Consumer Mood

This week's stock market news schedule highlights the two monthly consumer sentiment measurements. The consumer mood has soured in recent months, and is critical to both economic growth and investor enthusiasm, so keep closely attuned to the data points due Tuesday and Friday mornings. Friday's Personal Spending data should also tie in well with the week's driving factors. Also take note of Friday's manufacturing data, as institutional investors will be watching to see if further deceleration in the manufacturing sector might develop.

Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.

(Tickers: NYSE: DIA, NYSE: SPY, Nasdaq: QQQQ, NYSE: DOG, NYSE: SDS, NYSE: QLD, NYSE: NYX, NYSE: ICE, Nasdaq: NDAQ)

This Week: Testing the Consumer Mood

We reported on Monday's business schedule in an earlier article that you can find via this link.

Tuesday

The International Council of Shopping Centers (ICSC) is first to the wire on Tuesday with its regular Weekly Same-Store Sales Report. Last week's report covering the period ended September 18 showed sales fell 1.4% week-to-week. All weekly data points were impacted in the period due to the proximity to the Labor Day holiday. The next few weeks' data will offer a clearer view of real sales activity and the consumer mood. On a year-to-year basis, sales improved 3.3%. Redbook noted a 2.2% gain for the same period.

Redundant as it may be, the S&P Case Shiller Home Price Index is due for report at 9:00 AM ET on Tuesday. The last report, which covered the long since passed month of June, showed that the 10-City Index experienced a month-to-month price increase of 1.0%. The seasonally adjusted version showed a lesser 0.3% increase, but the measures do not adjust for the First-Time Homebuyers Tax Credit, which expired in June. The index showed prices increased 5.0% against the prior year period. The data is old, and we have seen price decline in other metrics (FHFA data & Home Sales) since, and we have also found reason to expect it from other data points.

The Conference Board will report on Consumer Confidence at 10:00 AM ET Tuesday. This September measurement of consumer mood is expected by the consensus of economists to mark 52.0, which would compare against the last reading of 53.5. Confidence is down nearly 10 points since May, and there is little reason to expect significant improvement on Tuesday.

State Street (NYSE: STT) reports on Investor Confidence at 10:00 AM. Investor Confidence fell in August, to 92.1, from 96.5. Stocks have been on the rise since the end of August, and so you can expect a better read here as well.

In DC, the Senate Budget Committee will examine the outlook for the economy and fiscal policy. This should make for an interesting political scuffle, as Republicans forget their sins of the past and point at Democrats as culprits behind recent deficits. There's a tough political debate in progress now, a fundamental struggle between fiscal prudence posturering and economic stimuli storm trooping. Meanwhile, the Senate Judiciary Committee examines ways to restore anti-fraud and anti-corruption laws post the Supreme Court decision regarding Enron's Jeffrey Skilling.

Overseas, North Korean leaders will meet in a rare gathering that some believe might offer insight into the Communist crazies succession plan.

The corporate news wire covers Hewlett-Packard's (NYSE: HPQ) analyst meeting. Barnes & Noble (NYSE: BKS) shareholders meet to vote on whether to give power to a group of directors headed by investor Ron Burkle. Look for EPS reports from Avatech Solutions (Nasdaq: AVSO), Cubic Energy (AMEX: QBC), Landec Corp. (Nasdaq: LNDC), Media Sciences International (Nasdaq: MSII), Misonix (Nasdaq: MSON), ModusLink Global Solutions (Nasdaq: MLNK), Napco Security Systems (Nasdaq: NSSC), Pro-Dex Inc. (Nasdaq: PDEX), Radiant Logistics (Nasdaq: RLGT), Sealy (NYSE: ZZ), SMSC (Nasdaq: SMSC), Sutor Tech Group (Nasdaq: SUTR) and Walgreen (NYSE: WAG).

JMP Securities LLC Healthcare Focus Conference will feature presentations by Atricure (Nasdaq: ATRC), Celgene (Nasdaq: CELG), Halozyme (Nasdaq: HALO), and Pharmerica (NYSE: PMC). The Bank of America Merrill Lynch Power & Gas Leaders Conference brings presentations by American Water Works (NYSE: AWK) and Xcel (NYSE: XEL). The Bank of America (NYSE: BAC) Merrill Lynch Banking & Insurance Conference brings presentation by the Royal Bank of Scotland (NYSE: RBS). The Telsey Advisory Group Consumer Conference brings presentations by International Game Technology (NYSE: IGT) and Jos A. Bank Clothiers (Nasdaq: JOSB). The Davidson & Co. Engineering & Construction Conference brings KBR (NYSE: KBR) to the table.

Wednesday

President Obama will make news Wednesday as he ventures to Iowa and Virginia to discuss jobs and the economy. A House Financial Services panel will convene to discuss the future of housing finance. Philadelphia Federal Reserve Bank President Charles Plosser will address the Greater Vineland Chamber of Commerce in Vineland, New Jersey on the topic of unwinding monetary stimulus.

The Mortgage Bankers Association will publish its Weekly Mortgage Applications Survey in the premarket as usual Wednesday. Last week's report covering the period ended September 17 illustrated the impact of the Labor Day holiday. The Market Composite Index of activity decreased 1.4% on a seasonally adjusted basis but increased 22.9% when unadjusted. Refinance activity decreased 0.9%, while Purchase Activity fell 3.3% on an unadjusted basis. Contracted rates on 30-year and 15-year fixed rate mortgages averaged 4.44% (down from 4.47%) and 3.88% (from 3.96%), respectively. Look for a more normal reading this time around.

In the week ending September 17, the EIA reported crude oil inventory increased by 1.0 million barrels while total motor gasoline inventory increased by 1.6 million barrels. Both crude oil and gasoline stocks stood above the upper limit of the average range for this time of year. Look for new data at 10:30 ET Wednesday.

Agricultural (farm) Prices are due for report for September at 3:00 PM ET. The report includes crop prices and livestock & produce prices, and is watched by economists for signs of inflation and its impact on the cost of living.

Overseas, the Bank of Japan publishes its tankan survey Wednesday.

In corporate news, look for EPS reports from Actuant (NYSE: ATU), American Greetings (NYSE: AM), China Precision Steel (Nasdaq: CPSL), CKE Restaurants (CKE.F), Family Dollar (NYSE: FDO), OMNOVA Solutions (NYSE: OMN), SYNNEX (NYSE: SNX), Worthington Industries (NYSE: WOR) and Xyratex (Nasdaq: XRTX).

FedEx (NYSE: FDX) meets with analysts on Wednesday. The JMP Securities LLC Financial Services and Real Estate Conference brings presentations by Amerisafe (Nasdaq: AMSF), D.R. Horton (NYSE: DHI), MFA Financial (NYSE: MFA) and Validus Holdings (NYSE: VR). The Wells Fargo Securities Consumer Conference (NYSE: WFC) brings presentations by Asbury Automotive (NYSE: ABG), Denny's (Nasdaq: DENN), Jack in the Box (Nasdaq: JACK), and Morton's Restaurant Group (NYSE: MRT). The Bank of America Merrill Lynch Banking & Insurance Conference brings news from BNP Paribus (Paris: BNP.PA) and Credit Suisse (NYSE: CS). The Bank of America Merrill Lynch Power & Gas Leaders Conference brings presentations by Exelon (NYSE: EXC) and Progress Energy (NYSE: PGN). Ford Motor Company (NYSE: F) is at the Paris Auto Show UBS Investor Conference (NYSE: UBS). The Oppenheimer & Co. Industrials Conference brings news from Kraton Performance Polymers (NYSE: KRA) and United Rentals (NYSE: URI).

Thursday

The final adjustment to second quarter GDP will be announced on Thursday at 8:30 AM ET. Economists expect no change to the data point, with growth seen at 1.6%. However, at last review, Q2 GDP was revised down from +2.4%. The GDP Price Index is also seen unchanged at +1.9%. This being the third report of GDP makes the chances of further adjustment less likely, and so what would seem like an important data point takes a back seat to other news.

The Weekly Jobless Claims data is due at its regular 8:30 reporting time. In the week ending September 18, jobless claims increased by 12,000, to 465K. Evidencing the stagnant state of labor, the four-week moving average eased by 3,250 to 463,250. Insured unemployment declined a tenth of a point to 3.5% in the week ending September 11. Economists forecast this week's claims report will measure 459K.

The Chicago Purchasing Managers Index is due for report at 9:45 AM ET. September's Business Barometer Index is seen measuring at 56.0, down from 56.7 at last report.

The EIA will report on Natural Gas Inventory at 10:30 Thursday. In the week ending September 17, natural gas inventory increased by 73 Bcf. Natural gas stocks stood 175 Bcf less than last year at this time and 195 Bcf above the 5-year average.

In corporate news, look for Sanofi-Aventis (NYSE: SNY) to hold a thematic seminar on diabetes and oncology. Dice Holdings (NYSE: DHX), LeCroy Corp. (Nasdaq: LCRY), The Advisory Board (Nasdaq: ABCO), Valassis Communications (NYSE: VCI), and Marsh & McLennan (NYSE: MMC) have investor or analyst days scheduled.

The EPS schedule includes news from Accenture (NYSE: ACN), Aehr Test Systems (Nasdaq: AEHR), AZZ Inc. (NYSE: AZZ), Charles River Associates (Nasdaq: CRAI), Christopher & Banks (NYSE: CBK), DemandTec (Nasdaq: DMAN), Lawson Software (Nasdaq: LWSN), McCormick & Company (NYSE: MKC), MSCI Inc. (Nasdaq: MSCI), Resources Global Professionals (Nasdaq: RECN) and Smart Modular Technologies (Nasdaq: SMOD).

DuPont (NYSE: DD) presents at the Oppenheimer 5th Annual Industrials Conference. O'Charleys Inc. (Nasdaq: CHUX) presents at the Wells Fargo Securities Consumer Conference.

Friday

Motor Vehicle Sales will be reported throughout the day Friday. Economists expect September Domestic Vehicle Sales will measure $8.6 million (annual rate). That would mark an increase from August's $8.3 million rate, which was down from July's $8.7 million.

Personal Income & Outlays will be reported for the month of August at 8:30 AM ET. Economists see personal spending rising 0.4%, which would match July's growth rate. The consensus sees personal income gaining 0.3% in August, a better rate than the 0.2% increase seen in July. The Fed's favored inflation gauge, the Core PCE Price Index is expected to show an increase of 0.1%.

The University of Michigan reports on Consumer Sentiment in conjunction with Reuters at 9:55 AM ET. Bloomberg's survey of economists sees this latest check up of consumer mood showing an improvement to a mark of 67.0, up from 66.6 at last check.

ISM will post its Manufacturing Index at 10:00 AM ET. Economists are looking for a September reading of 54.5, which would be down from 56.3 in August. Manufacturing is still decelerating, and so this particular metric should garner attention Friday.

Construction Spending is due at 10:00 AM as well. The latest data is expected to show a 0.4% drop for August, which would follow July's 1.0% collapse.

New York Federal Reserve Bank President William Dudley addresses the Society of American Business Editors and Writers in New York at 8:30 AM ET. Hey, I never got my invite, but I will be stealing market share away from all the folks attending.

Markets will be closed on Friday in China and Hong Kong, and Saturday marks the start of the Paris Motor Show.

The corporate news schedule highlights auto sales from Ford (NYSE: F), Toyota (NYSE: TM), Honda (NYSE: HMC), General Motors, Daimler (Nasdaq: DDAIF.PK), Nissan (Nasdaq: NSANY) and others. Liberty Media (Nasdaq: LINTA), LiveNation (NYSE: LYV) and Sunstone Hotel Investors (NYSE: SHO) present at investor days.

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

Wall Street News Preview 09-27-10

Morning Greek
Greek Factor: -1

Monday's Wall Street News Preview squintingly sees the market keying on two data points. Japan reported this morning that its export growth rate moderated for the sixth consecutive month in August. Meanwhile, the US prepares for the release of the Chicago Fed National Activity Index, which we see most likely to show softening for the August period. The "Greek Factor" ranges from +3 to -3, and is a subjective measure of The Greek's view of the market impact of individual and aggregate news and the day's scheduled events.

Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.

(Tickers: NYSE: DIA, NYSE: SPY, Nasdaq: QQQQ, NYSE: DOG, NYSE: SDS, NYSE: QLD, NYSE: NYX, NYSE: ICE, Nasdaq: NDAQ, NYSE: PG, Nasdaq: SYMC, NYSE: GIS, NYSE: FDX, NYSE: SI, NYSE: BVF, Nasdaq: SGEN, Nasdaq: ADUS, Nasdaq: ALXA, Nasdaq: MDRX, Nasdaq: INCY, Nasdaq: PODD, Nasdaq: VPHM, Nasdaq: CALM, NYSE: NTZ, NYSE: JBL, AMEX: PTN, Nasdaq: PAYX, NYSE: GBX, NYSE: ZLC.

Wall Street News Preview

Are we "big in Japan?" Well, I'm not sure, but "I think I'm turning Japanese, I think I'm turning Japanese; I really think so, I really think so!" I realize what you just read was the lamest copy ever published at The Greek, but it's 3 AM ET, so cut us a break, or maybe a bagel if you're up and baking.

Our weekly schedule is on tap for release later today. We decided to publish our Wall Street News Preview for Monday separately, so we could catch some sleep at this ungodly hour of the morning. This Wall Street News Preview keys on two market drivers, one that has arrived already and one that is to come. Still, we expect consistency in the modest negative message both should convey this morning. Thus the -1 Greek Factor rating, and red warning signal.

Japan's Export Growth Moderates
Greek Factor: -1

Japan's export growth slowed for the sixth consecutive month in August. Year-over-year export growth moderated to 15.8% in August, down from July's rate of plus 23%. Economists and The Greek are looking toward the strengthening yen and softer global demand for goods as the driving factors behind the drag. And there is also the normalization of prior year comparable that is occurring across the spectrum of economic data, which creates the appearance of a slowing rate of improvement. In actuality, and in absolute terms, economic activity has been pretty poor all year long.

Chicago Fed National Activity Index
Greek Factor: -1

While there are no major economic reports on the schedule for Monday, which is typical for the day, look for the Chicago Fed to release its National Activity Index at 8:30 AM ET. The CFNAI is a monthly index designed to gauge overall economic activity and related inflationary pressure. At its latest check up, The Chicago Fed National Activity Index increased to its historical average of zero in July from –0.70 in June. If August keeps to trend, we would expect this measure to backtrack a bit.

Corporate News Schedule

The corporate wire will be keyed by Procter & Gamble (NYSE: PG), which will announce its new "Vision for Sustainability." Symantec (Nasdaq: SYMC) gives an Educational Overview of its Business and User Authentication Business. General Mills (NYSE: GIS) and FedEx (NYSE: FDX) will hold their annual shareholders' meetings. Siemens AG (NYSE: SI) hosts its trading update conference call. Biovail (NYSE: BVF) holds a special meeting of shareholders. Seattle Genetics (Nasdaq: SGEN) will discuss the results of a recent cancer trial.

The JMP Securities Fifth Annual Healthcare Conference highlights presentations by Addus Homecare (Nasdaq: ADUS), Alexza Pharmaceuticals (Nasdaq: ALXA), Allscripts-Misys Healthcare (Nasdaq: MDRX), Incyte Corp. (Nasdaq: INCY), Insulet (Nasdaq: PODD), and ViroPharma (Nasdaq: VPHM).

The EPS schedule highlights news from Cal-Maine (Nasdaq: CALM), Industrie Natuzzi (NYSE: NTZ), Jabil Circuit (NYSE: JBL), Palatin Technologies (AMEX: PTN), Paychex (Nasdaq: PAYX), Greenbrier Cos. (NYSE: GBX) and Zale Corp. (NYSE: ZLC).



Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

Stock News Summary 09-24-10

Summing It Up

Stocks took off on decent Durable Goods Orders data, but you could have tuned the market out before noon, as trading leveled off from 10:00 AM forward. Once New Home Sales were reported, the wind was just sucked right out of the capital flow machine. Still, the Dow closed 1.9% higher on the day, and rescued a shaky week in the process. Enjoy your stock news summary below.

Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.

(Tickers: NYSE: DIA, NYSE: SPY, Nasdaq: QQQQ, NYSE: DOG, NYSE: SDS, NYSE: QLD, NYSE: NYX, NYSE: ICE, Nasdaq: NDAQ, Nasdaq: ORCL, NYSE: JWN, NYSE: NSM, NYSE: CAG, Nasdaq: OXBT, AMEX: GHM, Nasdaq: ULBI, Nasdaq: ATRO, Nasdaq: EVBN, AMEX: IEC, NYSE: SSS, Nasdaq: CMCO, Nasdaq: CTGX, Nasdaq: ROCK, Nasdaq: DIOD, Nasdaq: OPEN, Nasdaq: UNTD, Nasdaq: ABAX, Nasdaq: MRCY, NYSE: SF, NYSE: SSD, Nasdaq: ALGT, NYSE: DLX, Nasdaq: MSCC, NYSE: PLT, Nasdaq: POWI, Nasdaq: VLTR, NYSE: HYC, Nasdaq: IXYS, Nasdaq: QSII, Nasdaq: COHR, Nasdaq: HA, Nasdaq: SIRO, NYSE: LDL, AMEX: EVI, Nasdaq: HDII, Nasdaq: ISGT, NYSE: KBH, Nasdaq: PSBH)

Stock News Summary

Investing is often a game of guesswork, but by this questionable term, I mean the guesswork of forecasting how the investment community will react to market moving news. Yes, not only do you need to interpret data, but to forecast how your neighbor will.

You cannot read too much into the immediate direction of the broader market on news releases, because much of it simply reflects others' interpretation of how you and everyone else will view and trade on the data. It is basically trading off perception, and most of the traders doing this do not intend to hold on to their position longer than until just before the next data point release, if that long.

This morning, the market moved upwards on Durable Goods Orders, but by 10:00 AM, shares were questioning their new footing on another horrible New Home Sales data point. Investors need to see the bigger picture, while also factoring in the impact of short-term traders on prices of entry and exit, for the sake of maximizing profit.

If your investment horizon is long-term, what you need to pay attention to is how the next six months will shape out, not the next six minutes. But fret not dear day traders, as we can help you out here as well. Wrap up your day with a beer, cigar and your stock news summary from Wall Street Greek. It's our pleasure to serve you.

New Home Sales

Today we learned exactly why homebuilder sentiment was reported at record lows again in August. The latest report covering new home sales for the month, showed the annual pace of sales decelerating to a near stop, running now at a seasonally adjusted rate of 288K. This meager measure compares against July's upward raised mark of the same, up from 276K reported initially. The result was just 2K short of the economists' consensus. Still, the market took it as a reminder of how feeble the economy still is, and leveled off on the news. And oh by the way, the sales rate this August marked a 28.9% shortfall when matched against August of 2009. I don't know how many times I will have to say this over the next few months, but despite the then present housing tax incentive, last August was not the best of times. Thus, this much lower result is therefore staggering.

Durable Goods Orders

New Orders for Durable Goods fell 1.3%, missing the economists' consensus by three-tenths. Barron's reported expectations at -0.1%, and Bloomberg had the consensus at -1.0%. Clearly someone misprinted the information, but the drop of 1.3% represents bad news in its relative state nonetheless.

Durable goods orders have decreased three of the last four months, and this latest slide follows July's 0.7% drop. What enthused the market and economists, though, was that when excluding transportation, new orders increased by 2.0%. Transportation orders sway the overall result significantly, due to the general high-ticket price of transportation products like aircraft. Removing transportation and defense spending, which is often detached from the state of economic activity, allows for a more accurate reading of economic health. Leaving defense spending out this time around, left orders 1.2% lower.

The important metric here is that if we exclude defense and aircraft, capital goods orders increased 4.1%. This line item is considered a solid barometer of business spending. It reflects the confidence that businesses have in the economy, which offers insight into potential hiring activity as well. The rise in August compared against a 5.3% decline in July.

That said, there is much to be desired when it comes to the prescience of economic forecasting among purchasing managers and corporate types generally. I think the general incompetence that exists in the corporate environment is a product of being so far separated from the owner of the business. There's a certain disregard for making effort toward real value addition, as the employees view their employer as some large convoluted organization with vague ownership interests and seemingly disinterested management. It becomes a place to put your hours in, in order to collect a check every so often. Nobody really gives a damn anymore about making good for the boss. Instead, the modern corporation is full of people trying to make good face for their next review. Do you agree?

DC Doings

Chairman Bernanke discussed the lessons of the crisis today, which is linked to here. An FDA panel considered a mammogram device produced by Hologic (Nasdaq: HOLX).

Global Affairs

President Obama met with leaders of Southeast Asian nations just as tensions brewed between China, Japan, and North and South Korea. The U.N. Food and Agriculture Organization met to discuss the recent volatility in grain markets, due to Russia's ban on exports after a harsh drought and vast fires. Wheat prices are up sharply as a result.

Corporate Wire

Oracle (Nasdaq: ORCL) and Nordstrom (NYSE: JWN) met with analysts today. Shareholder meetings were held at National Semiconductor (NYSE: NSM), ConAgra Foods (NYSE: CAG), and Oxygen BioTherapeutics (Nasdaq: OXBT).

The Western New York Investors Conference highlighted presentations by Graham (AMEX: GHM), Ultralife (Nasdaq: ULBI), Astronics (Nasdaq: ATRO), Evans Bancorp (Nasdaq: EVBN), IEC Electronics (AMEX: IEC), Sovran Self Storage (NYSE: SSS), Columbus McKinnon (Nasdaq: CMCO), Computer Task Group (Nasdaq: CTGX), Gibralter Industries (Nasdaq: ROCK).

The Sidoti & Co., LLC Forum highlighted presentations by Diodes (Nasdaq: DIOD), OpenTable (Nasdaq: OPEN), United Online (Nasdaq: UNTD), Abaxis (Nasdaq: ABAX), Mercury Computer Systems (Nasdaq: MRCY), Stifel Financial (NYSE: SF), Simpson Manufacturing (NYSE: SSD), Allegiant Travel (Nasdaq: ALGT), Deluxe (NYSE: DLX), Microsemi (Nasdaq: MSCC), PLantronics (NYSE: PLT), Power Integrations (Nasdaq: POWI), Volterra Semiconductor (Nasdaq: VLTR), Hypercom (NYSE: HYC), Ixys (Nasdaq: IXYS), Quality Systems (Nasdaq: QSII), Coherent (Nasdaq: COHR), Hawaiian Holdings (Nasdaq: HA), Sirona Dental Systems (Nasdaq: SIRO), and Lydall (NYSE: LDL).

The short earnings schedule included EnviroStar (AMEX: EVI), Hypertension Diagnostics (Nasdaq: HDII), InSight Health Services (Nasdaq: ISGT), KB Home (NYSE: KBH) and PSB Holdings (Nasdaq: PSBH).



Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

Economic News Review 09-23-10

The stock market is seesawing today on mixed data that matched premarket doldrums against early morning enthusiasm. However, the efficient market has reviewed the economic news and found little to raise its hopes. Thus, shares are drifting lower as we publish. This economic news review covers the Weekly Jobless Claims data, Existing Home Sales, Leading Economic Indicators and more.

Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.

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Economic News Review

Apathy seems to best describe the process of getting used to the pathetic weekly claims data. Week after week, miserable result after tragic end, the depression is wearing on us. We have gotten used to it, and it is a sad, sad thing. While popular media seems perked up on the day's flow of data, the wiser stock market and a few insightful economists see things differently. The day's economic news review here covers Weekly Jobless Claims, Leading Economic Indicators, Existing Home Sales and Natural Gas Inventory.

Weekly Jobless Claims

Weekly Jobless Claims posted yet another plus 400K result this week, and ho hum, nobody cares. We've gotten used to it you see, and so the data for the period ended September 18 barely shook the market. New unemployment insurance benefit filers amounted to 465K this time around, and that is up 12,000 from the revised prior week count. The four-week moving average continues to precisely paint the doldrums of labor, barely nudging down 3,250, to 463,250. Insured unemployment slipped a tenth of a point, to 3.5%, but that likely had less to do with anything but people dropping out of the labor force. We aim to have more to say on claims later today.

Leading Economic Indicators

Leading Economic Indicators rose more robustly than expected in August, lending support to the morning market. LEI increased 0.3% in August, higher than the 0.1% gain economists had forecast. Furthermore, the latest gain followed up on July's 0.1% rise and June's 0.2% back-step. On the surface of the report, the data seems to say a positive change is taking place and that consideration of the data in absolution is not particularly threatening.

However, observation of the long-term index chart reveals an LEI Index that has been on the rise since about six months before the recession ended. What bothers many is that it seems to be topping out now, which from my perspective, raises concern. It is as if it is running out of steam, and could come crashing down like an aircraft that loses its forward thrust.

Looking more closely at the data reveals the Coincident Index was unchanged and the Lagging Index improved 0.2%. What has troubled us since the beginning of the improvement in the Leading Index, is that there are few natural drivers present. Instead, government stimulus measures have continued to play the most important role in the LEI's improvement. Again in August, the important factors behind the gain included interest rate spreads and money supply.

Well, guess what, the Federal Reserve is about impotent now, and the Federal Government is out of resources and has begun cutting back on housing and tax incentives. So, without these drivers, then what is to sustain the LEI? We intend to follow this up with more a more detailed article.

Existing Home Sales

Sales of used homes proved the real swing factor this morning, but that is a sad statement about the general wisdom of our media and investment community, because the news really was not that good.

The National Association of Realtors reported this morning that August sales of existing homes increased 7.6%, to an annual rate of 4.13 million. Sales exceeded economists' consensus expectations for a rate of 4.05 million. Sounds good right? Wrong.

This month's growth came against a severely soft July mark that followed the conclusion of the First-Time Homebuyers Tax Credit. On an absolute basis, rather than the relative metric reported, the pace of sales is downright depressing, down 19% from August of 2009. I remind readers that last year's period was not a robust one for activity, especially when excluding the tax incentive impact.

EIA Natural Gas Report

The EIA reported on Natural Gas this morning. For the week ending September 23, natural gas storage increased by 73 Bcf. Stocks were 175 Bcf less than last year at this time, but 195 Bcf above the 5-year average of 3,145 Bcf. The high relative level of natural gas is symptomatic of solid domestic reserves and burgeoning new sources, and a relatively light level of economic activity and thus demand. In other energy news, Petrobras (NYSE: PZE) prices a $75 billion stock offering.

DC Doings

With the President's economic team under fire, Paul Volcker, the Chair of the President's Economic Recovery Advisory Board, addresses the two-day International Banking Conference sponsored by the Chicago Federal Reserve Bank and the IMF at 1 PM ET. The Federal Communications Commission is opening up the airwaves, which is seen as a positive support underneath technology companies. Unused television stations are expected to be swept up. Goldman Sachs' conference (see below) seems well placed, as usual.

Markets are closed in Hong Kong, Japan, South Korea, Israel and Saudi Arabia today.

Corporate News Drivers

Blackstone Group (NYSE: BX), Adecco and Edwards Lifesciences (NYSE: EW) meet with analysts today. Kimco Realty (NYSE: KIM) hosts its investor day. Jones Soda (Nasdaq: JSDA) has its shareholders meeting.

AECOM (NYSE: ACM) and DigitalGlobe (NYSE: DGI), Waste Management (NYSE: WM), URS (NYSE: URS), Babcock & Wilcox (NYSE: BWC), Education Management (Nasdaq: EDMC), ITT Educational Services (NYSE: ESI), Envestnet (NYSE: ENV), IHS (NYSE: IHS), Orbitz Worldwide (NYSE: OWW) present at the Morgan Stanley (NYSE: MS) Business and Education Services Conference.

The Goldman Sachs Communacopia XIX Conference includes presentations from Verizon (NYSE: VZ), Time Warner (NYSE: TWX), Leap Wireless (Nasdaq: LEAP), Interpublic Group (NYSE: IPG), Liberty Media (OTC: LINTA.OB), Moody's (NYSE: MCO), Savvis (Nasdaq: SVVS), DirectTV (NYSE: DTV), Discovery Communications (OTC: DISCA.OB), Rackspace Hosting (NYSE: RAX), Level 3 Communications (Nasdaq: LVLT), Viacom (NYSE: VIA).

The EPS schedule includes news from Cano Petroleum (AMEX: CFW), Comtech (Nasdaq: CMTL), Corgenix Medical (Nasdaq: CONX), Finish Line (Nasdaq: FINL), General Finance (Nasdaq: GFN), Neogen (Nasdaq: NEOG), Nike (NYSE: NKE), Park Electrochemical (NYSE: PKE), Qualstar (Nasdaq: QBAK), Rite Aid (NYSE: RAD), Saba Software (Nasdaq: SABA), Scholastic (Nasdaq: SCHL), Spectrum Control (Nasdaq: SPEC), Texas Industries (NYSE: TXI), TIBCO Software (Nasdaq: TIBX), and Vail Resorts (NYSE: MTN).



Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

House Prices Sink & Confidence in Government Failing

Morning Greek
Greek Factor: -1

The day has a solid negative tone to it, given poor data out for housing prices, mortgage activity and crude and gasoline storage. Meanwhile, the demise of the President's economic team is furthering a case against the Administration's ability to give life to the economy. All the while, Ben Bernanke said the "D" word, or implied it anyways. The "Greek Factor" ranges from +3 to -3, and is a subjective measure of The Greek's view of the market impact of individual and aggregate news and the day's scheduled events.

Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.

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House Prices Sink, Confidence in Government Failing

Talk about trouble. "You picked the wrong time to leave me Larry," are the words the President might be saying this day and moving forward. With the flow of economic data still troubling, any further loss of consumer confidence seems certain to drive this economy into double-dip recession. Meanwhile, the Democrats might rather an aluminum bat to the brain then the departure of a critical economic advisor from the administration ahead of the November elections. You can mail it home now; the Republicans seem sure to take over Congress, unless more kooks turn up in the Tea Party.

FHFA Price Index
Greek Factor: -2

The FHFA posted its House Price Index today, which showed prices fell 0.5% from June to July. What's worse is that June's 0.3% decline was revised to a 1.2% drop. Price decline, which you will recall has been predicted within these pages for months now, is the natural consequence of sickly demand. Record low mortgage rates have thus far not been enough in an economic environment that struggles with soaking unemployment, restrictive lending, deteriorated credit ratings and a flood of low priced distressed property. Note that for the 12 months ended in July, prices are down 3.8%. We remind readers though, that the FHFA data is limited to the purchase prices of houses backing mortgages that have been sold to or guaranteed by Fannie Mae (OTC: FNMA.OB) or Freddie Mac (OTC: FMCC.OB). This is still important news, and a heavy negative for stocks today. Looks like housing shares might soon give back the gains made earlier this week.

Mortgage Activity
Greek Factor: -1

The latest Mortgage Applications Survey for the week ending September 17 shows mortgage volume fell, but don't read too much into the data point. The Mortgage Bankers Association has been imperfect in its adjustment efforts around holidays, and this particular report adjusts against Labor Day, which fell within the compared against prior week.

Thus, the seasonally adjusted Market Composite Index fell 1.4%, while the unadjusted measure gained 22.9%. As you can see, there's a lot of room for error here. Mortgage rates fell during the period, with contracted rates on 30-year and 15-year fixed rate mortgages falling to 4.44% (from 4.47%) and 3.88% (3.96%), respectively. Despite the decrease, the Refinance Index fell 0.9% in the period. The index measuring purchase activity decreased 3.3% on an adjusted basis, and rose 18.9% on an unadjusted basis.

This week, more than ever, we should rely on the four week moving average. The four week moving average for the seasonally adjusted Market Index is down 2.3 percent. The four week moving average is up 1.0 percent for the seasonally adjusted Purchase Index, while this average is down 3.0 percent for the Refinance Index. Finally, real estate investors will be well aware of the 38% deficit that exists in the volume of purchase activity against last year's period.

Bernanke's Shift
Greek Factor: -1

Yesterday's FOMC Monetary Policy Statement offered some interesting wording that seemed to focus attention to deflation risk. The Fed's statement specifically stated: "The Committee… is prepared to provide additional accommodation if needed to support the economic recovery and to return inflation, over time, to levels consistent with its mandate." That statement seems to prepare the market for future accommodative policy that may irk some hawks, like dissenter Thomas Hoenig. It certainly raises concern about the economic recovery, which should be the most important takeaway here.

Summers' Departure
Greek Factor: -1

The market is abuzz about the departure of President Obama's top economic advisor, Larry Summers, but I suspect there is less to this than it seems. Bloomberg Radio reported this morning that Summers' tenure would expire at Harvard, should he stay away for more than two years. While he could reapply, this fact might have played a small role in his decision. It is possible he and the President felt he could still be an important guide from outside the White House.

Maybe Summers just got frustrated with the scene in Washington, and the difficulty in getting economic policy through Congress. It is also possible that Summers sees the writing on the wall for the upcoming November elections, and has decided the Administration will have less sway with a Congress that might shift to the right. Still, the market is going to read into the departure as a sign President Obama's team is falling apart and that the Administration cannot cure what ails us economically speaking.

EIA Petroleum Status Report
Greek Factor: -1

The EIA reports every Wednesday on the flow of petroleum goods into and out of inventory. For the week ending September 17, crude oil inventory increased by 1.0 million barrels and gasoline stores increased by 1.6 million barrels. Both crude and gasoline stocks stood above the upper limit of the average range. Beware, though, crude shorters, because even as crude future prices on nearest expiration sit in the mid to upper $70s, the market is being reminded now of the great risk threatening over the next year or so… Iran conflict. Prices should be supported at least in the very near-term as the UN General Assembly meetings play out. The build up in inventory though, says something about economic demand.

DC Doings

The Senate Banking Committee is at work reviewing the government's response to the economic crisis, while a House Financial Services subcommittee is busy looking through the jobs bill.

Corporate Wire

The Goldman Sachs (NYSE: GS) Communacopia XIX Conference highlights presentations by New York Times (NYSE: NYT), Sprint Nextel (NYSE: S), Time Warner Cable (NYSE: TWC), AOL (NYSE: AOL), Scripps Networks (NYSE: SNI), Comcast (Nasdaq: CMCSA), Thomson Reuters (NYSE: TRI), MetroPCS (NYSE: PCS), THQ (Nasdaq: THQI), CBS (NYSE: CBS), Equinix (Nasdaq: EQIX), McGraw Hill (NYSE: MHP).

The UBS (NYSE: UBS) Global Life Sciences Conference includes presentations by Immunomedics (Nasdaq: IMMU), Luminex (Nasdaq: LMNX), Alkermes (Nasdaq: ALKS), Life Technologies (Nasdaq: LIFE), Spectrum Pharmaceuticals (Nasdaq: SPPI), Steris (NYSE: STE), Amgen (Nasdaq: AMGN), Thoratec (Nasdaq: THOR), ArthroCare (Nasdaq: ARTC), Brukur (Nasdaq: BRKR), Cadence Pharmaceuticals (Nasdaq: CADX), ICU Medical (Nasdaq: ICUI), SuperGen (Nasdaq: SUPG), Analogic (Nasdaq: ALOG), Danaher (NYSE: DHR), Geron (Nasdaq: GERN), GTx (Nasdaq: GTXI), Integra LifeSciences (Nasdaq: IART), Hi-Tech Pharmacal (Nasdaq: HITK), Infinity Pharma (Nasdaq: INFY), West Pharmaceutical Services (NYSE: WST), Halozyme (Nasdaq: HALO), Inverness Medical (NYSE: ALR), Martek (Nasdaq: MATK), Amarin (Nasdaq: AMRN), Anadys Pharmaceuticals (Nasdaq: ANDS), Medtronic (NYSE: MDT), Vivus (Nasdaq: VVUS), Affymetrix (Nasdaq: AFFX), Neurocrine Biosciences (Nasdaq: NBIX), Oncogenex (Nasdaq: OGXI), Medicis (NYSE: MRX), Kensey Nash (Nasdaq: KNSY), Medical Action (Nasdaq: MDCI), Santarus (Nasdaq: SNTS), The Medicines Co. (Nasdaq: MDCO), Exelixis (Nasdaq: EXEL), Onyx Pharma (Nasdaq: ONXX), SciClone (Nasdaq: SCLN), Avanir (Nasdaq: AVNR), Questcor (Nasdaq: QCOR), Keryx (Nasdaq: KERX).

Intuit (Nasdaq: INTU) and Flowers Foods (NYSE: FLO) have analyst meetings scheduled for today. The earnings schedule includes Bed, Bath & Beyond (NYSE: BBY), General Mills (NYSE: GIS), CarMax (NYSE: KMX), Copart (Nasdaq: CPRT), Darden Restaurants (NYSE: DRI), Dynatronics (Nasdaq: DYNT), eGain Communications (Nasdaq: EGAN), IHS (NYSE: IHS), Jefferies (NYSE: JEF), Lyris (Nasdaq: LYRI), PHC (AMEX: PHC), PSIVIDIA (Nasdaq: PSDV), Red Hat (NYSE: RHT), and Versar (AMEX: VSR).

Markets are closed in China, South Korea, Taiwan and Israel today.



Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.