Investors who hoped for a continued turnaround were quickly disappointed as financials led the Four Sisters lower. American International Group (AIG) sparked fears of continuing credit woes after announcing massive losses and write downs in its first quarter earnings report. Gold caught a bid this week as prices remained volatile but ended higher on the week. This move to quality was also apparent in treasuries as yields fell.

As discussed last week the commodity sell-off was short lived and this week’s bounce was apparent as oil peaked to $126, adding further pressure to the markets. The SPX was unable to hold its important 1405 support. The SPX is currently sitting at minor support of 1386 which corresponds to Thursday’s low from last week. Intermediate support lies lower at 1350 and a close below this level would put an end to the latest seven-week rally.

The Four Sisters Performance



ETF Watch


Click to enlarge

Top Headlines

Yahoo! (YHOO) led markets lower on Monday morning after Microsoft (MSFT) retracted its takeover bid for the company. (5/5)

The ISM Services index rose in the month of April, marking an expansion in the non-manufacturing sectors of the U.S. economy. The figure came in at 52%, up from 49.6% in March. (5/5)

The democratic primary race is slowly tilting in Barack Obama’s favor after winning the North Carolina primary last night. He has furthered his lead in the race despite Clinton’s win in Indiana. (5/7)

Pending home sales fell 1% in the month of March. Leading the decline was the Midwest as it saw a 10.4% drop. The index now stands 20.1% lower than a year ago in March 2007. (5/7)

Initial Jobless Claims fell 18,000 this week to 365,000. Compared to the same time last year initial claims are up 17% and continuing claims are 19% higher. (5/8)

Earnings Snapshot

Cisco (CSCO) reported net sales of $9.8 billion for the third quarter, marking a 10.4% increase over a year ago. The company cited execution of its long-term strategy for their steady performance. (5/6)

Disney (DIS) shares got a jump start this week after second quarter earnings came in 21% higher expected. (5/6)

Progress Energy (PGN) saw third quarter net income slip 24% to $209 mln. Poor results came in mainly due to mild weather in the Southeast and slower customer growth in Florida. (5/8)

Dow component American International Group (AIG) dragged markets lower on Friday after the insurance company announced losses of nearly $8 billion and a plan to raise capital through issuing new shares. (5/8)

Market Movers: Winners & Sinners