Wall Street Greek: THURSDAY’S MARKET: Government Shutdown Ignorance Day 3

The third day of this government shutdown ignorance finally has the market’s attention Thursday. The Treasury Department helped matters along this morning with its color on the subject of the debt ceiling. The use of the words “catastrophic” from a very conservative Treasury Secretary served as a sort of wake up call to Wall Street, but what of the idiots in D.C. with their misplaced ideologies. My message to Washington is: Just do the people’s business and stop playing Russian roulette with the global economy. It’ll be too late to say, oh, who could have known that would happen. We know and we are warning you yet again. If you appreciate daily market summaries like ours, please do come and visit our blog.

Thursday’s Market

Market ETF	October 3	Year-to-Date
SPDR S&P 500 (NYSE: SPY)	-0.8%	+16%
SPDR Dow Jones (NYSE: DIA)	-0.8%	+15%
PowerShares (Nasdaq: QQQ)	-1.3%	+21%

The market is finally starting to pay attention to just how dire things are. It took the Treasury Department’s using the words catastrophic several times this morning when describing what might follow a US debt default, for the investors to take heed.

Economic Events

ECONOMIC REPORT SCHEDULE
Economic Data Point	Prior Period	Expected	Actual
THURSDAY
Challenger Job-Cut Report	50,462		40,289
Weekly Jobless Claims	307K	313K	308K
Bloomberg Consumer Comfort	-28.1		-29.4
Factory Orders	-2.4%	+0.3%	Gov Ignorance
ISM Non-Manufacturing Index	58.6	57.0	54.4
EIA Natural Gas Inventory	87 Bcf		101 Bcf
John Williams Speech
Richard Fisher Speech
Gallup US Payroll to Population	43.7%		43.5%

-R symbolizes “revised”

The economic data, and there is some that is not produced by the government, offered a bit of a mixed report Thursday. Challenger’s Job-Cut Report, which shows announced corporate layoffs, relieved investors with a lower number for September than August. This figure can be influenced by the restructuring efforts of one or two large employers. This last month’s data was actually the lowest level of layoffs in three months, so it was good news.

However, given the government shutdown, the market is now looking toward the impact there, which should be similar to a natural disaster or hurricane. However, any unpaid time off will likely be made up for once the government agrees to a plan. Any employees of the government who apply for unemployment benefits after a week of this will be required to pay back the benefits once the government comes to terms and pays them for the unscheduled time off. On that note, Weekly Jobless Claims came in today at about the same low level reported the week before.

As you might imagine, consumer comfort is not reflecting ease among Americans given the catastrophic tone of the Treasury and President. The thing is, though, that they are absolutely correct; the effects of a debt ceiling default would be catastrophic and potentially irreversible. Thus, Bloomberg’s Consumer Comfort metric gave some ground this week. Consumers were already taking a break from spending in Q3; we don’t need that to continue into the all important Q4. The service sector seemed to reflect something at issue with consumer spending, as ISM’s Nonmanufacturing Survey showed a decline in its index measuring it. Still, it continues to reflect economic expansion at its current level.

Because the government is shut down, Factory Order data could not be relayed. More importantly, though, the monthly Employment Situation Report will not be reported on Friday. That bit of data is one of the most closely followed among economists and market movers and shakers. Flying blind is never a good thing, and uncertainty tends to work against stocks. It’s all the more reason for some panic to start to show itself in stocks this afternoon and Friday. I hope you heeded our warnings published in previous articles and hedged against risk.

Overseas Markets

EUROPE	11:09 AM	ASIA/PACIFIC	CLOSE
EURO STOXX 50	-0.3%	NIKKEI 225	-0.1%
German DAX	-0.2%	Hang Seng	+1.0%
CAC 40	-0.5%	S&P/ASX 200	+0.4%
FTSE 100	+0.2%	Korean KOSPI	+0.0%
Bloomberg GCC 200 Mideast	+0.0%	BSE India SENSEX	+2.0%

International markets are starting to show signs of concern, but markets traded mixed on the disbelief that America could really screw things up so badly. As more time passes, international markets will likely unravel, with emerging markets falling fastest and deepest.

Commodity Markets (11:01 AM)

WTI Crude	-0.6%
Brent Crude	+0.0%
NYMEX Natural Gas	-0.2%
RBOB Gasoline	+0.6%
Gold Spot	-0.2%
Silver Spot	-0.5%
COMEX Copper	-1.6%
CBOT Corn	+0.1%
CBOT Wheat	+0.6%
CBOT Soybeans	+0.8%
ICE Cocoa	-1.3%
ICE Sugar	-0.0%
ICE Orange Juice Conc.	-0.8%
CME Lumber	-0.4%
CME Live Cattle	-0.2%

Precious metals are still not really reflecting the degree of concern they should be, so investors continue to have opportunity through investments in the SPDR Gold Trust (NYSE: GLD), iShares Silver Trust (NYSE: SLV), Market Vectors Gold Miners (NYSE: GDX) and individual miners like Goldcorp (NYSE: GG). Personally, I would hold real gold in a hole in my basement if I were you.

Corporate Events

Two of the nation’s pharmaceutical chains are reporting earnings today. It’s nicely timed considering the start of Obamacare enrollment. It’s probably also noteworthy that Constellation Brands is reporting today...

REPORTING EARNINGS
Company	Ticker
THURSDAY
Rite Aid	NYSE: RAD
Walgreen	NYSE: WAG
Constellation Brands	NYSE: STZ
International Speedway	Nasdaq: ISCA
Comtech Telecommunications	Nasdaq: CMTL
IDT Corp.	NYSE: IDT

MOST ACTIVE STOCKS
BIGGEST GAINERS	% Gain
Zalicus (Nasdaq: ZLCS)	+422%
Tianli Agritech (Nasdaq: OINK)	+32%
EDAP TMS S.A. (Nasdaq: EDAP)	+19%
Omeros (Nasdaq: OMER)	+17%
InfuSystems (Nasdaq: INFU)	+14%
Promotora de Informaciones (Nasdaq: PRIS)	+15%
CalAmp (Nasdaq: CAMP)	+15%
BioAmber (Nasdaq: BIOA)	+13%
VIVUS (Nasdaq: VVUS)	+13%
Idera Pharmaceuticals (Nasdaq: IDRA)	+11%
BIGGEST LOSERS	% Drop
CEVA (Nasdaq: CEVA)	-16%
NetSol Technologies (Nasdaq: NTWK)	-15%
Angie’s List (Nasdaq: ANGI)	-14%
Maxcom Telecommunicaciones SAB (NYSE: MXT)	-13%
I.D. Systems (Nasdaq: IDSY)	-9%
Zale (NYSE: ZLC)	-10%
Texas Industries (NYSE: TXI)	-10%
Gilat Satellite (Nasdaq: GILT)	-7%
Bassett Furniture (Nasdaq: BSET)	-10%
American Caresource (Nasdaq: ANCI)	-10%

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