Here’s What The Fed Fund Futures Are Saying About Rates
Stocks rose
Tuesday in choppy trading
after
the Conference Board’s consumer confidence index
came in at a 2-year high. The Dow transports made a 4-year high today. Consumer
confidence jumped almost 9 points, to 101.9, up from a reading of 93.1 in May.
Oil prices fell to a 2-month low, hitting $35. June
should prove to be the NYSE’s slowest trading month this year.Â
The Fed is
meeting today and tomorrow, with a 25 bp rise in rates widely anticipated
tomorrow at the 2:15 PM ET announcement. This
would be the first rate hike in 4 years. One-third of CFOs see a tripling of
rates in the next 12 months, according to a Baruch College survey.
Fed fund futures are pricing in a 30-40% chance of a 50 bp rise in August.
Washington Mutual
(
WM |
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PowerRating)
fell after it cut its earnings forecast; it now expects to earn between $3 and
$3.60 a share and announced plans to cut jobs in its mortgage business. Nortel
made a pact with Flextronics
Intenational
(
FLEX |
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PowerRating) where FLEX will oversee manufacturing of telecom
equipment overseas. Nortel
(
NT |
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PowerRating) would receive between $675 million and
$725 million in cash from Flextronics. Under the proposed deal, 2,500
employees would transfer to Flextronics.
JetBlue CEO David Neeleman said he expects summer airline traffic to be
the best since 9/11.
The US is expected to hand
Saddam Hussein over to Iraq on Wednesday, but he will remain under US guard.
The Lifetime Fitness IPO will be
priced between $17-19 tomorrow. The company operates 33 fitness centers in eight
states.
After the close, Research in
Motion
(
RIMM |
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PowerRating) beat by 0.04 and guided higher. The stock traded up 6%
after hours.
| Dow | +56.34 | 10413.43 |
| S&P 500 | +2.85 | 1136.20 |
| Nasdaq | +15.11 | 2034.93 |
Strong today were Semis
(
SOX.X |
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PowerRating)
+1.74%, Disk Drives
(
DDX.X |
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PowerRating) +1.66% Networking
(
NWX.X |
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PowerRating)
+1.38%, Airlines
(
XAL.X |
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Chart |
News |
PowerRating) +1.20%,
Weak today were Amex Gold
Bugs
(
HUI.X |
Quote |
Chart |
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PowerRating) -2.23%, Retail
(
RLX.X |
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News |
PowerRating), -2.08%,
Economic news release today:
Consumer sentiment that rose to 101.9.
10-year Notes were +65 at
108 150
The dollar
was +0.69 at 89.38
Gold was -7.80 at 391.90
Crude Oil was -0.62 at
35.66
Volume was 1.37 billion
on the NYSE, and 1.57 billion on the Nasdaq.
Market breadth is positive.
| NYSE | Issues | |
| Advancing | 1728 | Up Vol 758 |
| Declining | 1589 | Down Vol 602 |
| Ratio | 1.08 | 1.25 |
| Nasdaq |
||
| Advancing | 1838 | Up Vol 1127 |
| Declining | 1271 | Down Vol 436 |
| Ratio | 1.44 | 2.58 |
Stocks in the news:
Halliburton
(
HAL |
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PowerRating) warned investors of a
$200 million charge due to its
Barracuda-Caratinga deepwater oil project in Brazil and another $615 million
charge related to asbestos insurance recoveries.
Target
(
TGT |
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PowerRating) dropped 4% after warning
that June sales would be weaker than expected. This comes on the heels ofÂ
WalMart’s
(
WMT |
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PowerRating) lowered sales forecast on poor Father’s day demand.
Prudential expects same-store sales for Target to rise by 2% and lowered Q2 EPS
to 46 cents a share.
American Greetings
(
AM |
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Chart |
News |
PowerRating) reported
earnings of $4.2 million on revenue of $445.7 million. For Q2, the company
expects to break even with analysts expecting a loss of 8 cents.
Brice Wightman
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