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Minyanville's Market Recap: Stocks Edge Lower On Month End


Bulls fail to take over on the last day of 3Q. Stocks edge lower.

Stocks edged lower today on the last day of 3Q. The Dow Industrials lost -0.13% to close at 13,895, the S&P 500 lost -0.315 to close at 1526, and the Nasdaq Composite lost -0.30% to close at 2701.

Markets began the day on sour footing. Former Fed Chairman Alan Greenspan was in the news stating the economy of the UK was doing exceptionally well although the risk of recession has risen. The statement coincided with a report by Goldman Sachs (GS) that the firm has reversed its outlook on the world economy warning that weakness stemming from the U.S. subprime crisis could hit Japan and Europe. Greenspan also mentioned his thoughts on the U.S. economy stating that risks of a recession have risen although he believes the figure is less than 50%. Greenspan recommended that the economy improve flexibility in order to avoid downside shocks.

Economic data seemed to lighten the mood a bit this morning however. Consumer spending data released by the Commerce Department came in at +0.6% versus +0.4% consensus. In addition, Core PCE inflation numbers on a month-over-month basis was inline at +0.1%. The PCE Deflator on a year-over-year basis came in at +1.8% versus +1.7%. Please read Professor Depew's Five Things You Need To Know for more color on these data points.

Elsewhere crude traded in a volatile session. November crude traded as high as $83.76 before ending sharply lower at $81.66 for a 1.5% loss. Gold surged to a high trading above the $750 as Barrick Gold (ABX) CEO was pumping prices to be $800 by year's end. Professor Limantour agreed on the bullish overtone, but warned Buzz readers "he is talking his position so be mindful."

Financials ended the day mostly down. The Philadelphia KBW Bank Index (BKX) fell -0.85. Morgan Stanley (MS) lost -2.4%, Merrill Lynch (MER) lost -0.36%, but Bear Stearns (BSC) added +1.37%. Goldman Sachs lost -0.02%. Toddo had been eyeing Goldman all week. Please read his Freaky Friday Potpourri for more on this trade as well as other valuable insights.

For more summaries of today's trading session, please click on our Buzz Bits. In addition, read Professor Shedlock's Global Credit Crisis Weekly Wrap-Up for an update on our credit situation.

Monday should be a light day with ISM Index figures coming out at 8:30 AM EST. Auto and Truck sales will be released late in the day at 5:00 PM EST. Click here to see the full trading radar for next week.

Below is a recap 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: BBND, SSCC, Gold, Silver, CDE, ES, ABX, ATVI, TZOO, KSS, BBG, CHK, PAAS, SSRI, SLV, CIEN, PALM, YHOO, GG, PCLN, SYNL, MATK, WPI, TXU, NGA, MHS, BHI

Some bearish trade or investment ideas: FXI, NILE, BCSI, AKAM, CBT, CMA, KLAC, LZB, RTI, WYNN, LVS

Alright, Minyans. Between football games, have a look at Professor Tatro's excellent article Tips For Trading With Under $25k. And don't be too surprised when Tulane upsets the Tigers. Have a great weekend!
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No positions in stocks mentioned.

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