Collision Course With Dow 10,500 Won’t Be a Straight Line

Intel (Nasdaq:INTC) reported excellent earnings last night, as I expected. The chip-maker beat on revenues and earnings per share. The stock is up close to 3% in the early going. That’s because Intel’s results weren’t exactly a surprise. During its mid-quarter update, Intel said the quarter was looking good. And the stock ran from $19 to $20.50 over the last few days. And as of press time it’s at $21.00.

Intel’s earnings are especially important because the company beat revenue expectations. As we know, investors want to see revenue growth. Costs have been cut, and if the economy is truly turning around, sales should grow.

US Mint Suspends Gold Coin Production

U.S. Mint Suspends Gold Coin Production
I could hardly believe the headline when I read it, but it’s true.
After a little checking around I found the official release from the U.S. Mint:"…Because of unprecedented demand for American Eagle Gold and Silver Bullion Coins, the United States Mint suspended production of 2009 proof and uncirculated version of these coins…"

Dollar Index and the Rally

There should be no doubt that the Cash for Clunker Stock Rally is directly related to the relative value of the U.S. dollar. Please note the strong support at 76. Also note that the dollar rallied hard from 76 starting in September 2008. That was when Lehman collapsed and money rushed for the safe haven of Treasuries.

A Bad Anniversary

Today is the one-year anniversary of Lehman Brothers’ cataclysmic failure. In other words, this time last year, the you-know-what was hitting the fan.
Lehman announced it was done on a Sunday. Amazingly, the S&P 500 opened down only a point down on Monday, at 1,250. By the end of the day, the S&P had lost 58 points. Stock prices swung wildly the rest of the week. It wasn’t until October 7, 2008 that the S&P went below 1,000.

Profit-taking? Or Something Worse…

Yesterday’s headlines made it sound like the sky was falling after China’s Shanghai Index sold off 6.7%. There’s no doubt bulls are a bit nervous and bears are getting a bit bolder. That’s to be expected after a six month rally that’s been remarkable in that there have been no corrections.

China Leads Declines

Stocks are selling off around the world. And China is in the lead. The Shanghai Composite is down 23% since August 4. Former Morgan Stanley Asia economist Andy Xie says Chinese stocks have been in bubble mode and there are more declines to come.