March 31, 2004

Morning Notes

~ Today marks end of quarter for stocks. US markets open weaker. London markets weaker at end of first quarter.

~ OPEC pledges to cut oil output by 1 million barrels a day beginning in April. The Organization of Petroleum Exporting Countries produces approximately one third of the world's oil.

~ Precious metals on the rise again. Gold moving closer to $450 per ounce, Silver to $8, and Platinum to $900. Dollar weakness continues.

~ Rumors of Greenspan being ill upset currency markets early Wednesday. Rumors denied. Greenspan has two remaining years on his term at the Fed. He is 78 years old. Rumors circulated a few weeks ago that Mr. Greenspan might step down. Rumors are rumors. Nevertheless, his absence would roil the markets in the short term.

~ The Commerce Department reported that new orders at U.S. factories rose a mere 0.3% in February - not the 1.5% Wall Street was expecting. January's revised data showed a decline of 0.9%.

~ The National Association of Purchasing Managers Index still shows economic expansion in March but the reading fell to 57.6 from February's 63.6 level. Many economists had expected to see a reading above the 60 level.

March 30, 2004

The markets ended higher for the day after a lackluster start, albeit on modest volume of 1.3 billion shares. Lower volume on up days continues to underpin the market. Market breath improved over past sessions with advancers over decliners at roughly a 2 to 1 margin on the big board. March has been a skittish month for the market, and it's only the end-of-quarter "window dressing" that has given it any heels. Ever hopeful that the economy will find its footing, investors pushed the markets to their best levels in three weeks.

Smart money appears to be sidelined however, awaiting the brow-raising employment data due out at the end of the week. Even still, where else is one to put their money? Yields are at 45-year lows. Too, the political stage appears ever more in shadow - few know at this time what are in the plans to ignite participation in the upcoming elections?

Bulls appear focused on generally upbeat corporate news, a more mild decline in consumer confidence than economists had expected (down 2/10 of one percent to 88.3 in March), and the always encouraging words from the Fed about a pickup in jobs just around the bend.

Bears just appear focused.

The DJIA tacked on 52.07, or 1/2 of one percent to close at 10,382; the S&P 500 rose 4.53, or 4/10 of one percent to 1,127; and the NASDAQ climbed 8.06 to just above the 2,000 level at 2,000.63, likewise - 4/10 of one percent higher for the day. Small-cap stocks also gained with the Russell 2000 climbing 1 percent to 589.40. With OPEC chanting about another round of production cuts, energy-related issues were among the days best performers. OPEC is scheduled to meet on policy tomorrow.

Conviction remains absent in the market. Without a sustained improvement in employment numbers, investors might continue to play the market but they're likely to keep a good number of chips in their pocket.