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Market Commentary for August 16, 2007


And the markets came tumbling down! At one point during the trading session today, the DOW was down over 340 points amidst heavy selling across the board. So is the recent market sell off just a correction or is it a serious reaction by investors to the ongoing housing financial sector problems? From the standpoint of many experts in the markets, it appears to be much bigger than just a correction. Day traders were ecstatic during the trading session today with volatile trading action not seen in a very long time. To many traders, it reminded them of the good ole’ days of 1999.

At the closing bell, here is how the major indices ended the session: the DOW (Dow Jones Industrial Average) posted a minor loss today of 15.69 points to end the session at 12,845.78; the NYSE (New York Stock Exchange) posted a loss of 1.94 points to end the session at 9,087.10; the NASDAQ posted a loss of 7.76 points for a close at 2,451.07; the S&P 500 moved higher by 4.56 points to end at 1,411.26 and the RUSSELL 2000 moved higher by 17.29 points to close at 768.83.

The FTSE All-World Index ex-US (top Large/Mid Cap aggregate from over 2,700 stocks from the FTSE Global Equity Index Series (GEIS) which covers 90% of the worlds investable market capitalization) posted a loss of 6.11 points to close at 239.52 and the FTSE RAFI 1000 posted a gain of 26.06 points to close at 5,851.37.

Economic Data:

Housing Starts: A monthly measure of initial construction of new homes, single family residential units and multi family units as released by the Commerce Department. A rising trend indicates an increase in demand for home furnishings, appliances and furniture. Housing Starts data released today by the Commerce Department: U.S. July Housing Starts fell by 6.1% to 1.381M compared to consensus of a drop by 4.6%; Building Permits fell by 2.8% to 1.373M Rate in July and June Housing Starts were revised to an increase by 2.1% from an increase of 2.3%.

Jobless Claims: A weekly compilation of new unemployment claims to show the number of individuals who filed for unemployment insurance for the first time. The condition of the labor market is determined by an increase of the number of claims which suggests a deteriorating labor market. Jobless Claims data released today: U.S. Jobless Claims rose by 6K to 322K for week of August 11th compared to survey of a drop by 1K and U.S. Continuing Claims for week of August 4th rose by 17K to 2,567,000.

EIA Natural Gas Report: Weekly information provided by the EIA (Energy Information Administration) on natural gas stock piles in underground storage in the United States and three regions of the country. Prices for natural gas products are determined by the level of inventories. Weekly change released for week of August 11th, by the Energy Information Administration: 21 Bcf.

Philadelphia Fed Survey: Philadelphia Federal Reserve district releases general conditions index from the business outlook survey which is a diffusion index of manufacturing conditions in the district. Philadelphia Fed Survey data released today: Philadelphia Fed August New Orders came in at 7.1 versus July reading of 11.3; Philadelphia Fed August Employment came in at 21.2 versus July reading of 4.1; Philadelphia Fed August Price Received came in at 8.8 versus July reading of 8.8; Philadelphia Fed August Price Paid came in at 15.4 versus July reading of 28.1; Philadelphia Fed August Business Index was expected to come in at 8.0 and Philadelphia Fed August Business Index came in at 0.0 versus July reading of 9.2.

Commodities Markets

The trend was lower across the board today for the Energy Sector: Light crude moved lower by $2.53 today to close at $70.80 a barrel; Heating Oil ended the session lower by $0.07 today to close at $4.98 gallon; Natural Gas moved lower today by $0.32 to close at $6.72 per million BTU and Unleaded Gas moved lower by $0.08 again today to close at $1.93 a gallon.

Metals Market ended the session lower across the board today: Gold moved sharply lower today by $21.70 to close at $658.00 an ounce; Silver closed lower today by $1.26 to close at $11.30 per ounce; Platinum moved strongly lower today by $44.00 to close at $1,227.50 an ounce and Copper moved lower by $0.24 to close at $3.08 per pound.

On the Livestock and Meat Markets, the trend was mostly lower across the board today: Lean Hogs ended the day lower by 2.78 to close at 65.80; Pork Bellies ended the day higher by 0.60 to close at 93.45; Live Cattle moved lower by 2.30 to close at 93.73 and Feeder Cattle ended the day lower by 1.85 at 114.70.

Other Commodities: Corn moved sharply lower on the day with a loss of 17.25 at 328.00 and Soybeans moved sharply lower again today for a strong loss of 50.00 points to end the session at 804.50.

The e-mini Dow ended the session today at 12,850 with another loss of 71 points on the trading session. The total Dow Exchange Volume for the day came in at 304,788 which are comprised of Electronic, Open Auction and Cash Exchange. Traders should review workshops available at the CBOT (Chicago Board of Trade) Educational in-person seminars schedules available on CBOT (Chicago Board of Trade) website.

Bonds were nicely higher across the board today amidst yet another strong market sell off: 2 year bond moved higher by 17/32 today to close at 101 4/32; 5 year bond moved nicely higher by 1 1/32 today to close at 101 26/32; 10 year bond moved higher by 31/32 at 101 6/32 and the 30 year bond moved higher by 1 18/32 to close at 101 6/32 for the day.

The end of day results for the CBOT (Chicago Board of Trade) which is comprised of the total Exchange Volume for Futures and Options (EVFO) including Electronic, Open Auction and Cash Exchange ended the day at 5,142,796; Open Interest for Futures moved higher by 45,898 points to close at 10,048,443; the Open Interest for Options moved higher by 101,469 points to close at 9,352,932 and the Open Interest for OTC moved higher by 180 points to close at 7,761 for a total Open Interest of 19,409,136 for a total Open Interest on the day for a gain of 147,547 points.

On the NYSE today, advancers came in at 1,262; decliners totaled 2,031; unchanged came in at 50; new highs came in at 11 and new lows came in at 1,107. Gainers and losers for the day as well as active day trading stocks on the NYSE: CME Group Incorporated (CME) made a strong plunge into much lower territory today for a loss of 10.40 points at the close with a high on the day of $536.93, a low of $505.89 for a final trading price at $529.50; Precision Castparts Corporation (PCP) moved sharply lower on the trading day to post a loss of 5.30 points with a high on the day of $122.00, a low of $110.82 for a closing price on the session at $119.10; Uniao de Bancos Brasileiros SA (UBB) gave up a strong loss today of 5.33 points with a high on the trading day of $105.98, a low of $89.90 to end the session at $97.67; Southern Copper Corporation (PCU) fell sharply lower on the trading day to post a loss of $4.14 points with a high on the day of $85.68, a low of $75.24 for a closing price at $84.54; iShares Silver Trust (SLV) gave up a strong loss of 6.05 points on the day with a high of $123.25, a low of $110.00 for a final trading price of $117.80 and National-Oilwell Varco Incorporated (NOV) posted a sharp loss on the trading session of 6.71 points with a high on the session of $109.71, a low of $97.81 to close the trading day at $103.12.

On the NASDAQ today, advanced totaled 1,390; decliners totaled 1,735; unchanged came in at 83, new highs came in at 9 and new lows came in at 376. Gainers and losers for the day as well as, active day trading stocks on the NASDAQ: First Charter Corporation (FCTR) bolted higher on the trading session to post a hefty gain of 38.71% to tack on 7.83 points for a final trading price of $28.08; Apple Incorporated (AAPL) continued its southbound trend today to post a loss of 2.60 points to close the session at $117.30; TBS International Limited (TBSI) posted a sharp loss on the trading session by 16.61% for a loss of 5.60 points for a closing price of $28.11; Baidu.com Incorporated (BIDU) moved strongly lower on the trading day to post a loss of 11.38 points with a high on the day of $176.50, a low of $161.00 to close the session at $168.50; Foster Wheeler Limited (FWLT) shed 7.90 points on the day with a high of $94.00, a low of $84.33 to end the session at $87.41 and Intuitive Surgical Incorporated (ISRG) shed 3.11 points on the session with a high of $198.37, a low of $185.10 for a closing price on the day of $189.63.

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Millennium-Traders