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Market Recap: Markets Finish Painful Week


Jobs spook Bulls; Markets close the week down 2.5%.

"Yeah, Mon, more swings than a Hedonism vacation," Toddo said into the market close. The Dow Industrials fell 146 points, or 1.22% to $11,893, the S&P 500 fell 11 points, or 0.84% to 1,293, and the Nasdaq Composite dropped 8 points, or 0.36% 2,212.

The markets finished an especially volatile week with major indexes falling to its lowest levels in two months. Stocks finished the week down 2.5% as credit jitters and margin calls continued to weigh on investors.

Banking shares were largely volatile. The Philadelphia Bank Index (BKX) recovered from opening weakness to gain 3.5% early in the session. Shares gradually fell to session lows of 1.3% before a late rally pushed banking stocks into positive territory. Professor Jon Markman described some of the fears that were taking place in the financial markets:

"I'd like to note that the Carlyle news is really a game changer," Professor Markman said. "That is a white shoe firm and the news shouldn't be underestimated. It's supposed to be smart money. We've been talking a long time about the fact that it doesn't matter how much the Fed cuts rates: if the banks don't want to lend, the game is over. If you are levered 32:1, as Carlyle was, then credit is your oxygen….the Carlyles of the world have the most access to credit. So if they can't get it, it's just not available."

The BKX closed higher 0.56% to $77.08. Goldman Sachs (GS) added 0.90 to $160.07. Morgan Stanley (MS) closed up 0.48% to $39.86, and Bear Stearns (BSC) gained 0.26% to $70.08. Toddo noted the banks in today's Random Thoughts.

Recession fears came alive on this morning's jobs report. The Labor Department said nonfarm payrolls fell 63,000 in February after falling 22,000 in January while the unemployment rate declined slightly to 4.9% from 4.8%. Economists were expecting a gain of 23,000 jobs with a gain in unemployment of 5%. For more analysis, read Professor Kevin Depew's Five Things You Need To Know.

Tech shares held up relatively well with notable performances in the betas. Apple (AAPL) finished up 0.57% to $122.13. Research in Motion added 0.43% to $98.24. Google (GOOG) finished flat -0.15% to $432.51, and Amazon (AMZN) added 1.99% to $64.00.

In other parts of tech, shares of Ciena (CIEN) surged 12% to $27.80. The company beat earnings expectations by $0.07 with revenues coming in at $227 mln also above consensus estimates. Professor Sean Udall also noted that the company guided higher "in a world where everyone else is guiding lower." Check out his article Ciena Beats Expectations, Tracks Higher.

In commodities, crude oil finished 0.02 to 105.45. Professor Adam Michael expected a little more strength in crude in the coming days but maintained a near-term bearish position. "Commercials are very short crude, but I'm waiting for higher prices before I press the short side. Commercials were net short about 100 k futures contracts in July and crude continued to rip a couple more weeks before correcting. I think the $110 level might offer a better risk/reward (if and when)."

In others, gold fell 1.90 to 975.20. Silver gained 0.027 to 20.158, and copper added 1.75 to 393.20.

The dollar index fell 0.011 to 72.990.

For more summaries, click on Minyanville's Buzz Bits.

Below is a recap of some of the idea flow on today's Buzz & Banter. Please note that stocks may appear in both bullish and bearish categories, due to long and short term trades by our many Minyanville professors.

Some bullish trade or investment ideas: GOOG, SGP, PG, IDU, CIEN, MDR, AAPL

Some bearish trade or investment ideas: SPY, Crude

Have a great weekend! See y'all Monday!

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No positions in stocks mentioned.

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