Tuesday, November 25, 2008

The Kirk Report

The Kirk Report

Spending Spree

Posted: 25 Nov 2008 05:42 PM CST

Consumers and businesses may not be spending money as they have in the past, but the government is on a historic spending spree.

S&P 500: 10 Day View

While we didn't gain much ground today, we didn't roll over and die either. A few more days of consolidation following the big reversal would be a positive development. Like many of you, I'm also wondering if we're seeing just more end-of-the-month portfolio dressing before the sellers come out in full force again next month, but we'll cross that bridge when and if we have to.

For tomorrow we have a flood of economic data to sort through before Thanksgiving but volume will remain light and trading will likely remain subdued. I know many of you are already headed out for vacation, so let me wish you a Happy Thanksgiving and safe travels.

Turkey Shoot

Posted: 25 Nov 2008 12:33 PM CST

TALF

Posted: 25 Nov 2008 08:30 AM CST

Good morning. Following the largest rally for the market in about twenty years, premarket futures suggest we're moving higher again today.

While the economic data this morning wasn't too inspiring (Q3 GDP fell 0.5% & weak chain store sales), premarket futures pushed significantly higher on news that the Fed & Treasury remain hard at work. In the latest move, Paulson has created the TALF to target consumer lending.

Premarket gainers: FNM, FRE, GGP, BHP, IDCC, DAKT, BBL, MT, SQNM, CTRN, ABB, JNY, SBLK, SAP, ALTH, HOGS, AAUK, TRIN, SCHW, GNK, CS, CIT, & RMBS.

Premarket losers: RTP, CRK, JRJC, ACTU, AXA, IPAR, LM, ZNH, SHLD, SNE, ONXX, ZQK, SBUX, DHI, JASO, AZN, ADI, HTX, & TD.

Treasury Secretary Henry Paulson will speak at 10:AM and we also have two more reports this morning - the Conference Board's consumer confidence gauge for November and the S&P/Case-Shiller home price index for September. Given the tone of premarket trading, one would assume more focus will be on the latest moves by the government than the economic data.

Believe it or not, the S&P has now moved by 6% in either direction for four consecutive trading days and more volatile action is likely to continue. Another big up move will push us back into short-term overbought territory so be careful out there if you're pressing new long positions. In fact, I'm not entirely convinced that we're set up for another big rally today although premarket futures clearly suggest we are. I'll have to wait and see how the market responds to Paulson at 10:AM.

Go make it a great day!

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