Market Update

A lack of leadership and an absence of trading catalysts have left the broad market to spend the session chopping along with a modest loss.

Although up from session lows, Financials have been a steady drag on overall action. The sector was contending with a loss on the order of 1% when it set its session low about an hour ago, but it has managed to trim that to a 0.6% loss. Banks, both diversified and regional, have weighed the most on the space.

Energy stocks have also hampered action. The sector’s 0.7% loss comes in conjunction with lower oil prices, which have been in the red all session and were most recently quoted with a 1.1% loss at $106.25 per barrel.

Defensive in nature and without any meaningful market weight, Utilities have been performing well all session. The sector currently sports a 1.0% gain with help from the likes of American Electric (AEP 38.68, +0.47) and Exelon (EXC 39.79, +0.88). Although not quite as strong, Telecom plays are performing well with a 0.5% gain.

The dollar has been contending with moderate selling for most of the session. It is currently down 0.2%. That makes for a lackluster follow-up to a 0.8% weekly gain. The greenback gained 1.3% the preceding week.

Treasuries have traded with modest strength today, but the benchmark 10-year Note has moved closer to the flat line with the imminent release of results from an auction of 10-year Notes.

There hasn’t been a single dose of economic data released today, but the latest monthly Treasury Budget will be posted at 2:00 PM ET.

Market update

Full size: click here

Oh yeah, that’ll work well…(sarcasm). Idiot academics; then why the hell should anyone pay their mortgages at all?

They’re not going to avoid another round of foreclosures, they’re going to make it worse.

Read here:

There’s a growing consensus among economists, investors, academics, and consumer advocates that more “principal reduction” — writing off a portion of a mortgage that exceeds a home’s value in exchange for a higher likelihood of repayment — can help avoid another wave of costly and economy-crushing foreclosures. That’s good for homeowners and lenders, and because millions of underwater mortgages are controlled by the government, it’s also good public policy.

But the country’s two biggest mortgage companies are not convinced, according to Edward DeMarco, acting director of the Federal Housing Finance Agency — which oversees the government-controlled mortgage giants Fannie Mae and Freddie Mac.

“Both [Fannie and Freddie] have been reviewing principal forgiveness alternatives and both have advised me that they do not believe it is in the best interest of the companies to do so,” DeMarco told Congress last week. He added that principal reduction is inconsistent with his mandate to protect taxpayers, who have invested more than $150 billion in the companies since 2008.

Read here:

The original story of Narcissus may be a couple thousand years old now but in the eyes of market strategist Adam Parker at Morgan Stanley, the myth about the boy who falls in love with his own image is about to make a comeback.

“My sense is that we’ve gone a little bit too internal now among U.S. investors,” Parker says in the attached video clip, adding we are so focused on our domestic comeback that we’re ignoring the risks that still exist in Europe and China.

Sure U.S. stocks have rebounded nicely and investors (theoretically) have enjoyed a nice six month run –not to mention a bull market that just entered its fourth year running– but Parker feels this inward focus is about to get a rude awakening.

“We don’t think U.S. companies have sufficiently guided down for the weakening economy in Europe,” Parker warns. He predicts that along with first quarter earnings results in April will be a slew of cautious commentary about the 2nd half due to the bite from a recession in Europe.

“I think you should be betting on the fact you will see more negative guidance from companies with exposure to Europe,” he says.

Read here:

On Monday, European finance ministers are expected to approve the latest bailout package for Greece, which last week got more-than 85% of its creditors to agree to “voluntary” haircuts on their Greek debt.

The resulting restructuring is the largest for a sovereign nation in modern history, and the first since the adoption of the euro in 1999, but did avoid a messy, disorderly “credit event.” But a default by any other name is still a default.

The EU has probably bought itself “several more months,” thanks to the Greek restructuring and the “radical measures” adopted by the European Central Bank, says Steve Forbes, chairman of Forbes Media. “You can keep kicking” the can down the road, “but crises emerge.”

Notably, Greek debt is trading in the so-called “grey market” as if Greece will fail to make payments on its newly restructured debt and Portuguese debt yields have risen sharply in the past week.

In sum, Forbes fears European policymakers have failed to take the “right” lessons from the Greek tragedy.

Right now “you have the worst of both words” in Greece, he says. “The economy is going into the tank without the pro-growth reforms to get it back again.”

Forbes prescription for Greece — and Europe’s other so-called PIIGS — is familiar to anyone who’s followed his work over the years: less regulation, labor reform and a “radically reformed tax structure,” featuring (of course) a flat tax.

“They’re going in the wrong direction” in Europe, he says, citing new tax increases in Spain and Portugal and Greece’s failure to really reform its bloated public sector.

“They need remedial education,” Forbes says of EU policymakers. “They’re all tied to defunct notion of Keynesianism that government spending somehow stimulates the economy — that easy money stimulates the economy. No it does not.”

Forbes compares European policymakers to medieval doctors who tried to “bleed the patient to cure the patient. So they killed the patient.”

Europe — and the Eurozone — certainly isn’t “dead” but the road to recovery from its rolling debt crisis is starting to look shaky, again.

via

WASHINGTON (AP) — The Justice Department’s civil rights division on Monday objected to a new photo ID requirement for voters in Texas because many Hispanic voters lack state-issued identification.

Texas follows South Carolina as the second state in recent months to become embroiled in a court battle with the Justice Department over new photo ID requirements for voters.

Photo ID laws have become a point of contention in the 2012 elections. Liberal groups have said the requirements are the product of Republican-controlled state governments and are aimed at disenfranchising people who tend to vote Democratic — African-Americans, Hispanics, people of low-income and college students.

Proponents of such legislation say the measures are aimed at combating voter fraud. But advocacy groups for minorities and the poor dispute that and argue there is no evidence of significant voter fraud.

In regard to Texas, “I cannot conclude that the state has sustained its burden” of showing that the newly enacted law has neither a discriminatory purpose nor effect, Thomas E. Perez, the head of the Justice Department’s civil rights division, said in a letter to the Texas secretary of state.

Texas Attorney General Greg Abbot has said the Obama administration is hostile to laws like the one passed last year in Texas.

The National Conference of State Legislatures called the voter ID issue “the hottest topic of legislation in the field of elections in 2011,” with legislation introduced in 34 states.

The department had been reviewing the Texas law since last year and discussing the matter with state officials. In January, Texas officials sued U.S. Attorney General Eric Holder, seeking a court judgment that the state’s recently enacted voter ID law was not discriminatory in purpose or effect.

As a state with a history of voter discrimination, Texas is required under section 5 of the Voting Rights Act to get advance approval of voting changes from either the Justice Department or the U.S. District Court in Washington, D.C.

In a letter to Texas officials that was also filed in the court case in Washington, the Justice Department said Hispanic voters in Texas are more than twice as likely than non-Hispanic voters to lack a driver’s license or personal state-issued photo ID. The department said that even the lowest estimates showed about half of Hispanic registered voters lack such identification.

The range was so broad because the state provided two sets of registered voter data.

In December, the Justice Department rejected South Carolina’s voter ID law on grounds it makes it harder for minorities to cast ballots. It was the first voter ID law to be rejected by the department in nearly 20 years.

In response, South Carolina sued Holder; the state argued that enforcement of its new law will not disenfranchise any voters.

Other states have moved toward photo ID requirements in the past year.

Alabama has a photo ID law, but it does not go in effect until 2014. Mississippi voters approved a photo ID law, but the state legislature has not yet adopted enabling legislation. The Justice Department has not yet reviewed the initiatives in either state.

The Justice Department has said it is reviewing voter ID laws in other states, but has not identified which ones.

Source

FuelCell Energy Inc.’s FCEL +13.33%   shares gained 13% after it reported less of a first-quarter loss than Wall Street anticipated. Read more on FuelCell.

Pacific Capital Bancorp PCBC +56.88%   shares rallied after UnionBanCal Corp said it would buy the company in an acquisition valued at about $1.5 billion.Read more in Financial Stocks.

Tudou Holdings Ltd.’s TUDO +146.52%U.S.-listed shares surged after the Chinese video website and rival Youku Inc. YOKU +18.51%  said they would merge. U.S.-listed shares of Youku gained 13%. Read more in Tech Stocks.

Velti Plc VELT +14.16%   shares rose 20% after the mobile-marketing company projected first-quarter revenue mostly above estimates.

Zoll Medical Corp.’s ZOLL +23.66%  shares leapt after Japanese chemical maker Asahi Kasei Corp. said it would acquire the medical device maker in a deal worth about $2.21 billion. Read more on Zoll buyout.

Decliners

Anthera Pharmaceuticals Inc.’s ANTH -47.51%  shares plunged after the company said late Friday it stopped a late-stage trial of an experimental heart-disease drug because it wasn’t working.

New Frontier Media Inc.’s KORS -5.10%   shares slid 4.8% after the luxury-goods seller filed for a secondary offering of 25 million shares.

Tranzyme Inc. TZYM -48.45%  shares declined 46% after the biopharmaceutical company said its experimental bowel drug did not perform well in a late-stage trial.

BOSTON (MarketWatch) — Anthera Pharmaceuticals ANTH -47.51% shares plunged nearly 50% to $3.67 on Monday during the first trading session after it announced it was halting a key Phase III study. Late Friday, Anthera said it stopping a Phase III clinical trial for its heart-drug candidate varespladib over concerns that it was ineffective.

SOURCE

via pennlive.com

STATE COLLEGE, Pa. — Penn State’s trustees have said something most already know: They fired late coach Joe Paterno in November over his alleged failure to follow up on a sexual abuse allegation against former assistant football coach Jerry Sandusky. That “constituted a failure of leadership,” the board of trustees said.

• Read the full report.

The report says the same thing of President Graham Spanier, who was ousted as president the same night Paterno was fired. Spanier remains a professor at the university.

A report issued today by the trustees says the board ultimately decided to fire Paterno after learning the details of his testimony before a grand jury when charges were filed against Sandusky.

The report also says the board decided to fire Paterno by phone because his home was surrounded by media and they deemed there was no “dignified, private and secure way” for trustees to meet with him in person.

Paterno died of lung cancer in January.

Neither Paterno nor Spanier were charged with a crime.

Sandusky’s trial on charges he sexually abused boys, many of them while on the Penn State campus, is scheduled for May, although that may change after a hearing today. He maintains his innocence.

[youtube://http://www.youtube.com/watch?v=CWB2G9reo2I 450 300]

Who has done more damage; Scooter Libby or Bradley Manning ?

“The single largest obstacle to meaningful economic recovery is a man who most Americans have probably never heard of, Edward J. DeMarco.

From his perch as acting director of the Federal Housing Finance Agency, DeMarco oversees Fannie Mae and Freddie Mac, the government-owned mortgage behemoths that collectively control about half of all home loans in the land. What he does shapes both the national housing market and the ability of troubled borrowers to hang on to their homes. What he has been been doing lately has been so unhelpful that Democratic lawmakers and grassroots advocacy groups are properly demanding his ouster.

DeMarco steadfastly refuses to allow Fannie and Freddie to help distressed homeowners by writing off principal balances on their mortgages. This has ensured that tens of millions of borrowers remain “underwater,” meaning they owe the banks more than their homes are worth — a status that has an alarming tendency to portend foreclosure. His refusal is based on logic that is both elegantly simple and tragically flawed: He is responsible for cleaning up the books at Fannie and Freddie, so he is against spending money.

If DeMarco were fire chief and your house became engulfed in flames, you could forget about calling 911. By his reasoning, the taxpayer would be best served by keeping the fire engines in the station, lest they get damaged in the line of duty. It would not matter whether the flames licking your windows were the result of your recklessness or the product of an explosion at, say, the methamphetamine lab down the street. He would not run up the municipal water bill by saving your block.

Many housing experts have long argued that writing down balances for underwater homeowners is the key to limiting foreclosures. Even the Obama administration — which previously fought against principal reduction — has come to embrace this strategy. The $25 billion foreclosure settlement that the administration brokered last month with the nation’s five largest banks includes provisions that will write down balances.

But if DeMarco keeps refusing to go along, the new program will be irrelevant. Only he has the power to make principal reduction happen broadly because only he has his hands on the levers at the institutions that control most of the mortgages.

“He is standing in the way,” Rep. Jerrold Nadler, the New York Democrat, told me on Thursday. “He is single-handedly saying that he’s opposed to any write-downs because all he cares about is the fiscal solvency of Fannie and Freddie — a legitimate concern, but not the only concern. If he doesn’t do what he ought to do, then he ought to be fired.”

Read more

In the energy space, Apr crude oil spent all of its electronic session in the red, extending losses after floor trading opened. Crude extended losses about 35 minutes ago, reaching a new session low of $105.38. In current action, crude is -1.7% at $105.67/barrel.

Apr natural gas traded in a tight consolidative pattern in negative territory in electronic trading. Nat gas chopped around between $2.26 and $2.27 in the early morning session and just fell to a new session low of $2.25/MMBtu. Nat gas is now -3.0% at $2.26/MMBtu.

In metals, Apr gold and May silver are also trading in the red. Both precious metals attempted to recover their losses after floor trading opened, but have lost steam. Silver just moved back to its current session low of $33.56 and gold is back near its session low as well. Gold is now -1.1% at $1693.30/oz and silver is -2.1% at $33.50/oz. May copper is down 3 cents to $3.83/lb.

Market Update

“Let the president be duly warned.

Rep. Walter B. Jones Jr., R-N.C., has introduced a resolution declaring that should the president use offensive military force without authorization of an act of Congress, “it is the sense of Congress” that such an act would be “an impeachable high crime and misdemeanor.”

Read more 

“(CBS News) Meir Dagan has been described as “hard-charging” and “stops at nothing.” For more than eight years, Dagan made full use of those qualities as chief of Mossad, Israel’s intelligence agency, where he focused on keeping Iran from developing a nuclear weapon. When that job ended, Dagan did something unheard of for an ex-Mossad chief: he spoke out publicly, voicing opposition to Israel launching preemptive airstrikes against Iran’s nuclear facilities anytime soon. Dagan believes the Iranian regime is a rational one and even its president, Mahmoud Ahmadinejad – who has called for Israel to be annihilated – acts in a somewhat rational way when it comes to Iran’s nuclear ambitions. Lesley Stahl reports.

The following script is from “The Spymaster Speaks” which aired on March 11, 2012. Lesley Stahl is the correspondent. Shachar Bar-On, producer.

When President Obama met with Israeli Prime Minister Benjamin Netanyahu this past week, the subject was how, when and if to attack Iran’s nuclear facilities, Netanyahu saying Israel can’t afford to wait much longer; Mr. Obama arguing there’s still time to let sanctions and diplomacy do the job. And he said some top intelligence officials in Israel side with him.

Actually, you’ll hear from one of them tonight: Meir Dagan, former chief of the Mossad, Israel’s equivalent of the CIA. It’s unheard of for someone who held such a high-classified position to speak out publicly, but he told us he felt compelled to talk, because he is so opposed to a preemptive Israeli strike against Iran anytime soon.

Dagan headed the Mossad for nearly a decade until last year. His primary, if not his only mission was to prevent Iran from developing a nuclear bomb. And he says there is time to wait, perhaps as long as three years.

Lesley Stahl: You have said publicly that bombing Iran now is the stupidest idea you’ve ever heard. That’s a direct quote….”

Read more

Get your burritos if you dare…..

Heat Map

S&P A/D Line

NASDAQ A/D Line

Source

“A lack of demand for China’s factory goods could be triggered by a slowdown in demand, particularly from EU countries. That almost certainly would hurt GDP growth in the People’s Republic. Chinese authorities likely would push more money into the economy, which has happened in the past month. What has not been discussed often is that, if China’s economy slows considerably, the problems created by lack of demand for its exports could cause a recession in the United States.

S&P recently put out a list of potential problems for the U.S. credit markets and economy. Among those are the usual risks, including the housing market and contagion for a collapse of one of more of the European economies. Also included among the threats is that China’s gross domestic product could drop to 5%.

S&P reports that a Chinese GDP collapse is entirely possible:

As Europe’s leaders grapple with a debt crisis and recession, and the Obama administration looks for ways to bolster the U.S. economy, world growth in 2012 will rely heavily on China. After real GDP growth in China slowed slightly to 9.2% in 2011, our base-case economic scenario calls for about 8% GDP growth this year from double-digit expansion in recent years.

We view the risk of only 5% GDP growth in China as plausible, although a stable one at this point. If such a scenario were to materialize, its negative effect on the U.S. and global economies could be substantial, particularly in the commodities and materials markets, where China is a large source of demand.

The normal position of the tables would be turned. China could become a less potent market for U.S. exports. And American GDP would be badly battered by a drop in demand for its agricultural products and manufactured inventories for expensive items such as airplanes. Just as bad would be a slowing of demand for U.S. intellectual property, which runs from software to services.

It is sometimes forgotten, particularly when trade numbers show that China’s export machine has hurt the U.S. trade balance, that the People’s Republic is one of the largest countries for U.S. exports. It would be ironic, but a Chinese recession could spread to America and sink GDP here as well.”

Douglas A. McIntyre

Full article

ISSUE GAINERS                 SYMBOL   EXCH   LAST PRICE   MONEY FLOW    RATIO 
                                                          (in millions) 
Zoll Medical                   ZOLL    NASD       92.80       +38.2       4.35 
ExxonMobil                     XOM     NYSE       84.73       +23.8       2.14 
iShr FTSE China 25             FXI     ARCA       38.93       +19.6       8.03 
IBM                            IBM     NYSE      200.85       +12.6       1.80 
Youku Inc ADS                  YOKU    NYSE       30.03       +12.0       1.37 
Sina                           SINA    NASD       77.82        +8.1       1.27 
Regions Fincl                  RF      NYSE        5.70        +7.5       4.32 
Coca-Cola                      KO      NYSE       69.76        +7.5       3.08 
Lowe's Cos                     LOW     NYSE       29.86        +7.1       2.26 
BP PLC                         BP      NYSE       46.46        +6.8       3.95 
Western Union Co               WU      NYSE       17.84        +6.7       4.58 
McKesson Corp                  MCK     NYSE       86.57        +6.5       2.16 
PwrShrs QQQ Tr Series 1        QQQ     NASD       65.05        +6.2       1.46 
Avalonbay Communities          AVB     NYSE      138.41        +5.6       2.89 
Abbott Labs                    ABT     NYSE       58.13        +5.5       1.73 
Direxn Daily Finl Bull 3x      FAS     ARCA       92.55        +5.3       1.24 
Goldman Sachs                  GS      NYSE      116.91        +5.1       1.25 
Disney                         DIS     NYSE       42.75        +5.1       1.79 
Merck                          MRK     NYSE       37.92        +5.0       1.81 
Starbucks                      SBUX    NASD       51.78        +4.9       1.91 

ISSUE DECLINERS               SYMBOL   EXCH   LAST PRICE   MONEY FLOW    RATIO 
                                                          (in millions) 
Apple                          AAPL    NASD      549.35       -88.9       0.85 
Bank Of America                BAC     NYSE        8.02       -14.5       0.59 
Microsoft                      MSFT    NASD       32.08       -14.1       0.41 
Google                         GOOG    NASD      603.01       -14.0       0.82 
SPDR S&P 500                   SPY     ARCA      137.51       -11.6       0.91 
McDonald's                     MCD     NYSE       97.30       -10.9       0.52 
JPMorgan Chase                 JPM     NYSE       40.39       -10.1       0.76 
General Electric               GE      NYSE       19.10       -10.1       0.38 
Oracle                         ORCL    NASD       29.66       -10.1       0.63 
Chevron                        CVX     NYSE      109.59        -9.8       0.57 
Hewlett-Packard                HPQ     NYSE       24.23        -8.9       0.35 
Johnson & Johnson              JNJ     NYSE       64.77        -8.1       0.41 
Procter & Gamble               PG      NYSE       67.03        -7.5       0.47 
Intel                          INTC    NASD       27.05        -7.1       0.54 
Exelon                         EXC     NYSE       39.25        -7.0       0.60 
Cisco Systems                  CSCO    NASD       19.80        -6.5       0.31 
AT&T                           T       NYSE       31.27        -6.4       0.51 
Discovery Comm A               DISCA   NASD       46.58        -6.0       0.23 
Wal-Mart Stores                WMT     NYSE       60.41        -5.3       0.49 
American Public Education      APEI    NASD       39.42        -5.2       0.02

“NEW YORK (CNNMoney) — Ridership on the nation’s trains and buses hit one of the highest levels in decades, with officials crediting high gas prices, a stronger economy and new technology that makes riding public transit easier.

In 2011, Americans took 10.4 billion trips on mass transit — which includes buses, trains, street cars and ferries, according to the American Public Transportation Association.

That’s a 2.3% increase over 2010 and just shy of the number of trips in 2008, when gasoline spiked to a record national average of $4.11 a gallon.

“As people get jobs and go back to work, they get on mass transit more,” said Michael Melaniphy, president of APTA. “And then when people look at gas prices, they really get on transit more.”

Melaniphy said gas prices near $4 a gallon tends to be the tipping point that pushes more people onto mass transit.

Obama makes alternative-fuel vehicle push

Read more