I don't write these, I just post them every now and then.
U.S. TRADING SUMMARY: Wall Street stocks slumped at midday Tuesday
as the market heeded a slew of bad news, including a record U.S.
trade deficit, a strong Japanese yen, and a profit warning from
APPLE COMPUTER CORP. (AAPL: 71-1/16, - 8) ''It's the weakening in
the dollar, the disaster in Taiwan, it's Apple Computer, "The
trade-deficit numbers certainly did not show what Wall Street
wanted to see," said Barry Hyman, senior equity analyst at
Ehrenkrantz King Nussbaum. "The deficit shows that the consumer is
still spending -- and spending It shows that the as measured by
the consumer, is still strong and that pressure on the Fed to
raise rates." The trade figure confirms other reports that have
shown gains in retail sales and lower inventories, signs that
consumption hasn't slowed despite two rate increasesthis year.
Interest-rate sensitive financial and technology stocks took big
hits on the news.
U.S. TREASURIES: U.S. Treasury bond prices drifted lower for a
second day Tuesday after news of an unexpectedly large U.S. trade
deficit caused the dollar to weaken further against the Japanese
yen. "Treasurys are trading in tandem with the dollar," said Kevin
Flanagan, money market economist at Morgan Stanley Dean Witter &
Co. Inc. in New York. "Given the lack of significant economic data
in the next few sessions, that's likely to continue." Prospects of
a substantial supply of corporate bonds and the expectation of
hawkish comments from a slew of Federal Reserve officials also
pressured the Treasurys market.
CURRENCIES: The dollar tumbled against the yen Tuesday, falling
three yen in 10 minutes after the Bank of Japan defied market
expectations and left monetary policy unchanged. At midday in New
York, the dollar bought 104.78 yen, down sharply from 106.48 late
Monday. The euro was trading at $1.0460, up from $1.0355 late
Monday. A record U.S. July trade deficit added further pressure to
the dollar. The Bank of Japan announced Tuesday that its policy
board voted to leave monetary conditions unchanged. Traders had
hoped the central bank would ease policy as part of a coordinated
effort to weaken the yen.
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