Daily Summary....

U.S. Markets
Dow +298.98 (+2.50%)
Nasdaq +24.14 (+1.05%)
S&P 500 +28.10 (+2.14%)

News That Moved the Market

Regulators Meet to Save Bond Insurers. The markets rallied Wednesday on solid volume. One of the catalysts for the move was news that U.S. banks were meeting with New York State insurance regulators in an effort to sure up funds for struggling bond insurers. The new capital would help bond insurers keep their AAA ratings. Ratings downgrades could spark another panic and oversupply in the credit market, as well as push banks profits even lower. Bond insurers like MBIA (MBI, +32.6%) and Ambac (ABK, +71.9%) jumped on the news and the previously weak financial sector led Wednesday's rally.

Apple Drags Down Tech. The tech sector underperformed mainly because of last night's Apple (AAPL, -10.7%) earnings report, which beat estimates, but offered a disappointing forecast.

Pfizer Back on Track. Pfizer (PFE, +2.8%) announced fourth-quarter earnings that beat expectations and surprised the Street by upping its 2008 outlook.

Ebay's CEO Steps Down; Outlook Disappoints. Ebay's (EBAY, 6.7% day; -8.3% A.H.) CEO Meg Whitman announced she will retire and be replaced internally by John Donohoe. Ebay also reported a 53% increase in sales after the bell, but was down in after hours trading because of a gloomy 2008 outlook.

Tomorrow:

Notable Earnings:
Amgen (AMGN)
AT&T (T)
Ford (F)
Microsoft (MSFT)
Nokia (NOK)

8:30 AM: Jobless Claims
10:00 AM: Existing Home Sales
10:30 AM: Crude Inventories

Rumors that the European Central Bank (ECB)....

will cut rates tomorrow.

We'll see.

Market Rallies to close higher.....

Dow + 298
S&P + 28
Nasdaq +24


News that the State of New York Insurers Association was in discussions to bail out major bond insurers, sent the market sharply higher in the last hour of trading. The downgrade of Ambac by Fitch last Friday is one of the main reasons we sold off hard on Tuesday across the globe.

As I said earlier, we were severely oversold, and some sort of good news was needed to turn the direction of the market. This news did the trick. Now, we need to see a follow thru rally tomorrow to at least start to close the chapter in this worst January selloff ever.

We're not out of the woods yet...by any means...but this was a start.

EBay out with earnings after the bell. Right now, the stock is down about 8%.

More later.

Noon Update....

Dow - 165
S&P - 23
Nasdaq -60


This is ugly a selloff as I've ever seen and it all started on a whim, as traders decided to sell off stocks and take profits beginning on December 27.

The idiots on TV are saying that they want to see a complete washout of 600+ points in one day. That's a bunch of Bull. We've seen the market drop almost 2,000 points from this created hysteria. Enough is enough.

At some point the traders who have willed the market to crash will turn and go long. Not sure when that happens but I think it is soon.

Another critical day for the Market....

Dow opened -260 currently -110
S&P opened -32 currently - 15
Nasdaq opened -68 currently -32

This negativity needs to stop today. We need to rally and close higher or I fear the panic will really start to set in.

Earnings the Rest of this Week...

Wednesday

Abbott Laboratories (ABT) 4Q .92 BMO
Brinker Intl Inc. (EAT) 2Q .33 BMO
Capital One Fincl Corp. (COF) 4Q .90 4:05PM
Coach Inc. (COH) 2Q .69
ConocoPhillips (COP) 4Q 2.37 8:30AM
Delta Air Lines Inc. (DAL) 4Q (.13)
eBay Inc. (EBAY) 4Q .38
Freeport-McMoRan Copper & Gold Inc. (FCX) 4Q 1.76 BMO
General Dynamics Corp. (GD) 4Q 1.41
Gilead Sciences Inc. (GILD) 4Q .41 4:05PM
LSI Corp. (LSI) 4Q .06 AMC
Motorola Inc. (MOT) 4Q .12 7:00AM
Netflix Inc. (NFLX) 4Q .13
QLogic Corp. (QLGC) 3Q .23 AMC
QUALCOMM Inc. (QCOM) 1Q .49 4:00PM
SLM Corp. (SLM) 4Q .39 BMO
Southwest Airlines Co. (LUV) 4Q .11 BMO
St. Jude Medical Inc. (STJ) 4Q .49 8:00AM
Stryker Corp. (SYK) 4Q .66 4:00PM
SunTrust Banks Inc. (STI) 4Q .42 BMO
United Tech Corp. (UTX) 4Q 1.07 BMO
WellPoint Inc. (WLP) 4Q 1.50 6:00AM
Western Digital Corp. (WDC) 2Q 1.00 AMC

Thursday

American Express Co. (AXP) 4Q .74
Amgen Inc. (AMGN) 4Q .96
AT&T Inc. (T) 4Q .71 8:00AM
Baxter Intl Inc. (BAX) 4Q .75
Beazer Homes USA Inc. (BZH) 1Q (1.86)
Becton Dickinson & Co. (BDX) 1Q 1.03
Broadcom Corp. (BRCM) 4Q .28 AMC
Cooper Indus Inc. (CBE) 4Q .82 BMO
E*TRADE Fincl Corp. (ETFC) 4Q (3.15) AMC
Eastman Chemical Co. (EMN) 4Q 1.06 5:00PM
Ford Motor Co. (F) 4Q (.22) 7:00AM
Hershey Co. (HSY) 4Q .56
Juniper Networks Inc. (JNPR) 4Q .22 AMC
Kimberly-Clark Corp. (KMB) 4Q 1.11
Lockheed Martin Corp. (LMT) 4Q 1.70
Nokia Corp. (ADR) (NOK) 4Q .61 6:00AM
Northrop Grumman Corp. (NOC) 4Q 1.31
Nucor Corp. (NUE) 4Q 1.20
Potash Corp. of Saskatchewan Inc. (POT) 4Q .97
Sun MicroSyss Inc. (JAVA) 2Q .30
SunPower Corp. (SPWR) 4Q .35
Union Pacific Corp. (UNP) 4Q 1.79 8:45AM
US Airways Grp Inc. (LCC) 4Q (.16)
Xerox Corp. (XRX) 4Q .41 7:00AM

Friday

AirTran Hldgs Inc. (AAI) 4Q .03
Caterpillar Inc. (CAT) 4Q 1.49 7:30AM
Fortune Brands Inc. (FO) 4Q 1.44
Harley-Davidson Inc. (HOG) 4Q .81 BMO
Harman Intl Indus Inc. (HAR) 2Q .76
Honeywell Intl Inc. (HON) 4Q .91 BMO
IDEXX Laboratories Inc. (IDXX) 4Q .36 7:00AM
ImClone Syss Inc. (IMCL) 4Q .28
Weatherford Intl Ltd. (WFT) 4Q .96

Traders in Control....

This market is now feeding on itself. As we mentioned last week, it was important that the Fed act IMMEDIATELY to stem the shift in sentiment. They waited too long.....now they have no respect from the Traders.

We are now completely at the mercy of Hedge Funds and Traders who enjoy selling the market off...because they are short. I had feared the fact that over the past five years, the number of Hedge Funds increased exponentially as did the number of Exchange Traded Funds that enable traders to sell off multiple stocks with a single trade. This is why.

Now...the world economy is all of a sudden collapsing??? Yeah, right. This is a joke, but unfortunately you can lose alot of money as a result. We need some good news to turn this around. Apple's warning didn't help at all. Microsoft is the next big name to announce earnings....on Thursday.

Before the Bell.....

U.S. stock futures are trading lower this morning after a disappointing outlook from Apple stoked concerns about a slowdown in consumer spending in a market that remains unconvinced that yesterday's surprise interest rate cut from the Federal Reserve can stave off a recession.

Elsewhere, Europe's leading exchanges edged higher in opening trade, helped by gains in the insurance sector on merger and acquisition talk surrounding Swiss Re and Prudential. But investors remained cautious as they continue to assess the implications of the U.S. Federal Reserve's interest rate cut.