Tag - WB

Mention the “B” word as a viable investment path in this time of great hand-wringing on Capitol Hill and Wall Street, and some might gasp, shake their heads and run away. That word is banks.

Is it time to call the exorcist to oust those demonic thoughts? Not necessarily, because digging beneath the doom-and-gloom headlines of catastrophic failures and loan losses, some financial-services companies are chugging along quite nicely. 

SCBT Financial Corp. (Nasdaq:SCBT), which primarily operates as South Carolina Bank and Trust, appears to have escaped a drenching from the bloodbath. The 75-year-old Columbia, S.C., company operates 50 Carolinas branches.

SCBT’s philosophy is typical of banks that have not been pulled under by the meltdown: know your market, keep the customer satisfied and stick to what has kept you in business. Over the past three months, its share price has risen 26%, and is up 14% year to date. Amid the turmoil, SCBT hit a 52-week high of $45.24 on Sept. 19, contrasted to a July 15 low of $26.25. The stock closed Monday at $36.16.

Analysts who follow SCBT have expressed positive comments. In a Sept. 23 clients’ note, SunTrust Robinson Humphrey’s Mac Hodgson said, “We continue to recommend SCBT as a small-cap stock we want to own long term because it is a standout in terms of credit quality and growth opportunities.” Hodgson has a “buy” rating and a $38 price target, noting “SCBT is among a select few banks that has been able to consistently deliver pristine asset quality and earnings growth … .”

Fig Partners managing principal and director of research Christopher Marinac, who has had SCBT at “outperform,” noted in a report that he’s expecting an earnings uptick this year and next because of “the opportunity and ability of SCBT to . . .

Small-cap stocks remained unsettled this morning, unable to embrace Friday’s rescue plan package as equity markets around the world seized up and credit pipelines remained clogged despite massive additional liquidity injections this morning by the Federal Reserve. At 9:50 a.m. ET, the Russell 2000 (NYSE:IWM) was down 19.38, or 3.13%, at 600.02, slipping to the lowest point on intraday charts since May 2005.

In Europe, extraordinary measures were taken over the weekend on the banking front, with France’s BNP Paribas buying assets of beleaguered Fortis, while in Germany a rescue deal for Hypo Real Estate was sweetened by another 15 billion euros of liquidity, adding to an earlier pledge of 35 billion euros.

Everyone has been talking about the Federal Reserve slicing the Fed funds rate, but that rate has already been trading well below the current 2% rate in the market. This morning, the Fed increased the size of its cash auctions and also offered banks interest accrual on reserves. Stock index futures did pull off the overnight lows heading into the open on the Fed injection news, but the inability to stabilize financial markets in the direct aftermath of the $850 billion financial bailout bill Friday reflects just how deep the crisis is running.

Looking at market action around the world, European shares were off nearly 5% into the U.S. stock market opening. Elsewhere, Russian stocks tumbled some 15%, prompting various exchange trading halts. Japan was down 4.9%, Hong Kong off nearly 5%, China down 5.1%, Taiwan down 4.1%, Australia off 3.3%, Singapore down 5.6%, South Korea off 4.2% and India down 5.7%.

Market research experts at Goldman Sachs slashed their economic forecast for growth and interest rates “substantially” in a report issued Friday afternoon. Goldman said “The recession that we have been forecasting now looks likely to be deeper and longer, taking the unemployment rate to 8% by late 2009 and pushing the . . .

Small-cap stocks pushed lower Friday, as optimism over government approval for a massive bailout of financial bad debt gave way to somber economic data on the employment picture. It was a strange session from a market movement standpoint, but in the end the Russell 2000 (NYSE:IWM) stumbled 18.27, or 2.87%, to 619.40, the lowest weekly close since May 2005. Even more startling is that the Russell 2000 collapsed 12.1% this week, clearly one of the largest one-week debacles in history. For the year, the Russell is down 19.2%, while the Dow is off 22.1% and the S&P 500 is down 25.1%.

In some ways, it was an unusual session as the market initially shrugged off the negative employment report, instead rejoicing about a large banking merger deal between Wells Fargo (NYSE:WFC) and Wachovia (NYSE:WB). In addition, stock traders appeared to be basking in the glow that the House would certainly OK the rescue plan this time around. Earlier this week, House Republicans shocked the market by narrowly rejecting the $700 billion “Paulson Plan” but with the economy careening toward recession and a couple of tax break sweeteners added to the deal, there was little choice in an election year from lawmakers but to embrace (perhaps with gritted teeth) the rescue plan.

In typical “buy-the-rumor, sell-the-fact” market action, equities rallied into the House vote, then promptly reversed course and sold off in the afternoon. There was some sense that if the market weren’t so oversold and if talk wasn’t circulating that a potential emergency rate cut by the Federal Reserve might be in the works that the slide would have been even greater.

As for the employment report, 159,000 non-farm jobs were shed in September, the largest one-month decline in some five years, while the unemployment rate held steady at 6.1%. The market was looking for a loss of 100,000 jobs, so the number was worse than feared, but there were “whisper” numbers ahead of the release that were even worse. The bad news is that most economists are predicting the next two months will be even more painful as the economy deals with the credit crisis and the recent loss of huge financial firms. So, from a price standpoint today, . . .

Small-cap stocks are expected to open higher, underpinned by M&A activity on the banking front, a jobs report that traders think will usher in rate cuts and oversold conditions following Thursday’s downside rout. The Russell 2000 (NYSE:IWM) was up about 0.5% in after-hours trade, which suggests an opening near 641.

The non-farm payrolls figure on the employment report came in at minus 159,000, which was worse than the projection for a decline of 100,000. In addition, the unemployment rate was pegged at 6.1%, which was in line with the forecast. This marked the steepest rate of job cuts in more than five years, and economists were already warning that worse numbers are still to come in the next couple of employment reports. Stock index futures trimmed gains slightly after the report came out, but it appeared to be only a glancing blow as the market suddenly rallied back to new overnight highs. There was some thought that the weak payrolls number will now clear the way for rate cuts, so in a perverse sense, the market was trying to look forward to an immediate rate cut and therefore finding “good” news in the bad jobs release.

Now that the jobs report is out of the way, the market will likely be forced to sit and wait out the House vote on the financial rescue package, which is expected later today. Even though the bill was shot down by House republicans the last go-around, it is widely expected to pass this time.

Earlier this morning, Wells Fargo & Co. (NYSE:WFC) announced a merger deal with Wachovia Corp. (NYSE:WB) that would be consummated without any financial assistance from the government or FDIC. WB shares nearly doubled in after-hours trading on the news, and even WFC stock upticked slightly, even though . . .

Small-cap stocks started out the week on a sour note, resuming the downward spiral in jolting fashion to post the largest one-day decline of 2008 as fears of a global financial pandemic triggered wave after wave of selling. The Russell 2000 (NYSE:IWM) shed 47.07, or 6.68%, to 657.72, the lowest daily close since March 17. For the year, small caps are down 14.1%, while the Dow is off 21.5% and the S&P 500 is down 24.1%.

The market woke up to news that Europe is now being forced to bail out financial institutions, as Fortis became the first eurozone bank to sag under the weight of global debt issues. European shares slumped to the lowest daily close in 3 ½ years, which set the tone for difficult day in U.S. stocks. When lawmakers in Washington shot down the $700-billion rescue plan for financial firms by a vote of 228 to 205, it extended the decline, with the S&P 500 plunging more than 8% at the intraday lows. The S&P 500 tumbled to the lowest point since October 2004 with dramatic declines in financial shares leading the way lower.

Within financials, Bank of America (NYSE:BAC) was off some 12%, and American Express Co. (NYSE:AXP) lost nearly 13%. Wachovia Bank (NYSE:WB) collapsed about 80% as the bank was forced to slough off most of its banking operations to Citigroup Inc. (NYSE:C), as Wachovia became the latest shocking failure in the on-going saga. The small-cap arena is heavily layered with mid- to small-tier banks, and even though the big-name firms are dominating the national headlines, these smaller firms are not immune to the financial contagion, which is reflected in the slide in the Russell 2000.

Technology shares struggled Friday on fears that political wrangling could jeopardize the financial rescue bill, and today’s rejection of the plan extended the woes for tech stocks as the Nasdaq 100 dropped more than 10%. Among tech stocks, Apple Inc. (Nasdaq:AAPL) was off some 16%, while bellwether Microsoft Corp. (Nasdaq:MSFT) was down about 4%.

Broad market sectors on the decline today were paced by financial, tech themes and even commodity firms. The biggest losses were seen in coal and steel stocks, but metals, asset management companies, oil refiners, regional banks and . . .

Small caps have plunged late afternoon after the bailout bill failed to pass in the House overshadowing the Federal Deposit Insurance Corp.’s brokered deal for Citigroup (NYSE:C) to purchase Wachovia’s (NYSE:WB) banking operations.

At 2:07 p.m. ET the Russell 2000 (NYSE:IWM) was down 5%, or 36, to 668. 

The House of Representatives failed to pass the $700 bailout bill, shocking markets and sending the S&P to its lowest level since 1997. After the bill failed, a motion was made for reconsideration of the bill; however attempts to revive it failed. Uncertainty looms around what comes next.

"Right now the market is extremely disappointed,” Andy Busch, global foreign exchange strategist of BMO Capital Markets, said. “It’s a huge embarrassment to both the Democratic and Republican leadership in the U.S. House. This bill shouldn’t have been brought to the floor if they couldn’t have passed it in its current form. I firmly believe that this was the gun to everyone’s head that they needed to see what was out there for the people who voted against it. I believe they will bring back this bill in another form and vote on it again. It’s dead for now…but I think it’s pretty clear they want to get something done because of the disastrous affect it’s had.”

In an attempt to battle the burgeoning credit crisis globally, the Federal Reserve along with the central banks of other countries said they will work together to inject cash into the global financial system to provide relief for debilitated banks. The U.S. central bank has also received authority to pay interest on reserves held by the Fed.

“This should encourage banks to leave funds at the bank while they receive 2%,” Busch said in an email. “This will allow the Fed to expand its balance sheet without forcing Fed Funds to zero. This means they can potentially pump up the liquidity by massive amounts to assist with the credit crunch.”

In the latest chapter of the credit crisis, Citigroup will act as Wachovia’s white knight under the direction of the FDIC and acquire its banking operations. Under the terms of the deal, Citigroup will assume $42 billion in losses and provide the FDIC with $12 billion in preferred stock and warrants, while the FDIC will absorb the remaining losses. The deal also contains a provision that protects Wachovia debtholders. To finance the deal, Citigroup said it will offer $10 billion in stock and cut its quarterly dividend by half to $0.16 per share. The sale follows the Charlotte, N.C.-based bank’s . . .

Small caps plunged out of the gate on concerns over the $700 billion bailout bill’s effectiveness, global financial distress and as investors digested the Federal Deposit Insurance Corp.’s brokered deal for Citigroup (NYSE:C) to purchase Wachovia’s (NYSE:WB) banking operations.

At 10:15 a.m. ET the Russell 2000 (NYSE:IWM) had tumbled over 3%, or 22.38, to 682.51. 

Regulators came to an agreement on the closely watched $700 billion bailout plan this weekend and will begin voting on the bill today. The bill would essentially nationalize toxic mortgages in an effort to free banks’ balance sheets of these opaque instruments that have frozen lending. However, the market remains skeptical of the bill’s ability to isolate and thwart this reeling financial crisis.

In the latest chapter of the credit crisis, Citigroup will act as Wachovia’s white knight under the direction of the FDIC and acquire its banking operations. Under the terms of the deal, Citigroup will assume $42 billion in losses and provide the FDIC with $12 billion in preferred stock and warrants, while the FDIC will absorb the remaining losses. The sale follows the Charlotte, N.C.-based bank’s negotiations over the weekend with Wells Fargo and Spain’s Banco Santander. 

Overseas, world markets are swooning. Britain’s FTSE index is down almost 3% on Monday’s session, as the United Kingdom experiences the wrath of the credit crisis. Mortgage lender Bradford & Bingley became the second bank to be bailed . . .

Small caps opened mostly flat, as Fed Chairman Bernanke, Treasury Secretary Paulson, and SEC Chairman Cox testify before Congress on the $700 billion mortgage bailout plan and the recent market turmoil.

At 10:10 a.m. ET the Russell 2000 (NYSE:IWM) was up 12.43, or 0.20%, to 721.87.

Fed Chairman Bernanke, Treasury Secretary Paulson and SEC Chairman's Cox all began testifying before the Senate Banking Committee at 9:30 a.m. ET. The market remains skittish and skeptical, as the administration’s officials paint the details of the plan and what dire consequences could result should Congress opt not to pass the bailout. In a prepared statement for the panel Bernanke said, “If financial conditions fail to improve for a protracted period, the implications for the broader economy could be quite adverse.”

The plan, in which the government would take ownership of all toxic mortgages from affected banks’ balance sheets, effectively rids banks of the poison that has thwarted their operation and enables them to begin shoring up their financial positions to begin lending again. Recent reception has been hostile by certain members of congress. The two most contentious areas include limiting executive compensation and amending the bankruptcy law to allow judges to change the terms of the toxic mortgages. One area of agreement is broader congressional oversight and taking equity stakes in firms which partake in the rescue efforts.

Today will be a day of waiting and listening. Some investors are concerned the plan could get hung up in Congress’ halls, while others remain curious about many of the plan’s details.

In its latest efforts to further shore up ailing banks, the Fed loosened the rules surrounding the ability of buyout shops and private investors to take stakes in them. This is a testament to the level of apprehension regulators have about banks’ liquidity positions.

Overseas, China’s market jumped a hefty 7.8%, as regulators took . . .

Stock index futures are higher in overnight trading as the world’s leading central banks pumped billions of dollars into the global financial system. The Federal Reserve nearly quadrupled the amount of dollars central banks can auction around the world to $247 billion in a coordinated effort to ease the current financial crisis. Financial markets embraced the news by pushing the cost of borrowing in dollars overnight to 3.84 percent from 5.03% Wednesday. It was 2.15% last week.

S&P 500 stock index futures are up 0.75% in overnight trading, adding 8 points as of 8:45 a.m. ET. At one point last night stock futures were up as much as 1.3%, but gains were trimmed after news broke that Morgan Stanley (NYSE:MS) is considering a merger with Wachovia Corp. (NYSE:WB). 

The dollar continued its recent decline overnight losing 110 points versus the euro and much smaller amounts against the yen and pound. Crude oil added to yesterday’s gains, climbing $3.80 to $101 on overnight New York Mercantile Exchange trading.

Gold continued to surge in overnight trading adding another $33 to $880. Wednesday gold rose an astounding $70 an ounce or 9% to $847, the biggest percentage one-day gain since September 1999. Investors are being driven to the relative safety of gold as global equities plummet. Gold sales to new clients at Blanchard & Co., the largest U.S. precious-metal retailer, have jumped more than six-fold in the past three days as investors respond to the financial turmoil. “People are looking for answers,” said David Beahm, a vice president at New Orleans-based Blanchard. ”People want . . .

After spiking into the green out of the gate, small caps have since plunged and are flickering in and out of the green and red midday after waning global economic growth weighed on oil, pushing the dollar and larger-cap equities higher.

At 12:30 p.m. ET, the Russell 2000 (NYSE:IWM) slipped 3.46, or 0.46%, to 750.91, while the Dow had gained 18.73, or 0.16, to 11634.66.

Crude has touched a low on today’s session, selling off $3 a barrel to roughly $111 midday and posting a three month low, after OPEC forecasted that global demand for energy continue to falter.

Higher oil prices have pushed input costs for all companies higher and have weighed on operations. A decline in global growth would mean a reduced thirst for oil, which would push down the escalating raw material costs for most firms. However, that slower growth means less demand for final products. So it’s a double edged sword keeping equities in check.

“The global economic race to the bottom appears to be over as the U.S. has hit bottom and the rest of the world is still falling,” Andy Busch wrote in an email today.

The potential slowing global growth’s effect on oil sent the dollar surging to $1.4686 against the euro and 110.47 against the yen midday. The surge in the dollar as of late all started with the European Central Bank’s dovish comments last Thursday followed by reported negative GDP growth in the euro zone.

Small-cap stocks slipped Tuesday, pulled down by struggling financial sector shares and a profit-taking mentality following sizable gains the previous two sessions. The Russell 2000 (NYSE:IWM) was off 6.12, or 0.82%, at 744.94, while the Dow was down 1.19% at 11,642.47 and the S&P 500 was down 1.21% at 1,289.59. For the year, the IWM is down 2.75%, the Dow off 12.22% and the S&P 500 down 12.19%.

Small caps made a huge move during Monday’s rally relative to large-cap shares, fueled somewhat by ideas that a sinking U.S. dollar would stand to benefit smaller, domestic companies more than large multinationals who depend on sales to foreign customers. But even on today’s pullback, small caps still outperformed the Dow and S&P 500, reflecting investor taste for riskier fare and also on thoughts that previous similar economic cycles have benefited small caps over large-cap shares. However, the Russell was trumped today by the Nasdaq 100, as tech stocks put together a solid performance.

Tech stocks — and most equity indices in general — were underpinned on dips by a slide in crude oil prices, which slipped below $113 dollars a barrel for the first time in three months and eventually settled U.S. trading right near the $113 line. Demand destruction remains a concern for the energy market, as the Energy Information Administration today reported the largest drop in U.S. demand in 26 years, which countered some bullish supply concerns tied to the Russia/Georgia conflict. Elsewhere on the commodity front, gold price tumbled 1.7%, but the Commodity Research Bureau Index of 19 commodity markets was only off about 0.3%.

A recent surge in the U.S. dollar has played a key role in the decline of energy and other commodity prices, but today the greenback was relatively calm, failing to get a charge out of a surprisingly strong international trade report early this morning. The trade deficit narrowed to 56.7 billion dollars, which was better than the forecast for a deficit of 61.5 billion. Normally that would be enough to trigger more volatile response from foreign exchange traders, but with the dollar already soaring 7.5% . . .

Small-cap stocks edged lower shortly after the opening, pulled down by weakness in the financial arena, a bounce in crude oil prices and long profit-taking following two sessions of huge gains. At 10:00 a.m. ET, the Russell 2000 (NYSE:IWM) was down 4.22, or 0.56%, at 746.84. The Dow was off 0.58%, while the S&P 500 was down 0.51%.

Financial stocks were back in the spotlight this morning, pulled down by a batch of fresh bearish news overnight and a spate of analyst downgrades in various big names. Morgan Stanley (NYSE:MS) and Wachovia Corp. (NYSE:WB) were pressured by the auction-rate security fiasco, as WB settled a probe on the issue and lowered Q2 numbers, while MS offered to reimburse investors. It’s a painful hit to the bottom line that the number one bank Citigroup Inc. (NYSE:C) already has faced. In addition, Oppenheimer analysts lowered the outlook for Goldman Sachs Group Inc. (NYSE:GS). Shortly after the open, MS was down 3.0%, WB off 4.5%, C down 1.2% and GS down 3.3%. The Financial Select SPDR was down 1.9%.

The market also frowned upon a sudden recovery bounce in crude oil prices, which saw the market on black gold move from three-month lows near $113 overnight back toward the $115 zone into the stock market opening. The rise in crude was tied to news that some production and transport in the Georgia region was going to be offline, even though Russian officials have ordered an end to the military conflict.

Elsewhere on the commodity inflation front, corn futures were called lower following USDA’s August production report, which forecast a larger crop than expected. However, softs markets were climbing this morning and the iPath GSCI Total Return commodities index was up about 0.3% in early trading. After huge declines in recent days, a consolidation move or bounce in commodities certainly wouldn’t . . .

Small-cap stocks are expected to open near steady levels as investors mull over the big two-session advance in prices and short-term longs book profits. The Russell 2000 (NYSE:IWM) was basically unchanged overnight, and large-cap futures indices were narrowly mixed.

The international trade report showed that the U.S. deficit narrowed to minus 56.7 billion, which was better than the forecast for a deficit of minus 61.5 billion, helped by a weaker U.S. currency, which makes exports of U.S. goods more attractive.

The dollar was narrowly mixed right before the trade report, and firmed against the euro after the data. The market will often see big moves in foreign currency markets on the trade report, but the action was quite tame after today’s release.

Stock markets around the world were mixed overnight, with Asia shares primarily lower. Stocks in Russia jumped 3%, but shares in Japan were down 0.9%, Hong Kong off 1%, China down 0.5%, India down 1.8%, Taiwan down 0.4%, Singapore down 0.3% and Australia up 0.5%.

Crude oil prices slipped to three-month lows overnight, but recouped a $1-a-barrel decline heading into the U.S. stock market open, bouncing back from $113 to $114. Some of the overnight selling was tied to news that Russian officials ordered . . .

Small-cap stocks pressed lower in early trading, pulled down by losses in overseas equities trading, a swollen inflation picture from morning economic data and ongoing jitters over financial shares. At 10:02 a.m. ET, the Russell 2000 (NYSE:IWM) was down 8.60, or 1.20% at 707.55. The Russell is testing short-term support along the 707.50 line; a breach of that point would put the next key support point near 701.00.

This morning’s personal income report provided a mixed picture within the data series, with personal income better than expected, and consumer spending above forecast. However, the market focused on the inflation portion of the report, which showed the year-over-year PCE price index at 4.1%, the highest rate in 17 years. And even though headline personal income was better than expected at 0.1% vs. the projection for a dip of 0.2%, it was still the smallest rise since April 2007. The factory orders report at 10:00 a.m. ET came in at 1.7%, which was well above the forecast for a rise of 0.7%.

In stock market trading around the world, equities were out of favor overnight. Japan’s Nikkei was off 1.2%, Hong Kong’s Hang Seng down 1.5%, and China’s stock market down 2.3%. Elsewhere, Taiwan was down 0.3%, as was Australia. Meanwhile, Singapore was down 1.0%, South Korea off 1.9% and India down 0.5%.

European shares were also down heading into the U.S. stock market open, with financial shares acting as a drag after HSBC reported a 28% decline in first half profits and reported a hefty $14 billion debt write down tied to bad U.S. home loans and other asset losses. Major U.S. banks Citigroup (NYSE:C), Bank of America (NYSE:BAC) and Wachovia (NYSE:WB) were down 2.7%, 2.1% and 4.0%, respectively, shortly after the open. Earlier this morning, Oppenheimer analyst Meredith Whitney predicted on CNBC that housing prices were on tap for further losses and she painted a dreary picture for banks, investment banks and brokers.

Some large-caps to keep an eye on today that could spill trends over into the small-cap arena include Chicago Bridge& Iron Co. (NYSE:CBI), which could get a boost after a bullish article in Barron’s over the weekend. Other stocks finding favor in Barron’s include railroad firms Union Pacific (NYSE:UNP) and Canadian National Railway Co. (NYSE:CNI).

Some relief for stocks could come from a pullback in crude oil prices this morning, with futures down more than $1 a barrel, slipping below $124. Bears were pointing to rising output from OPEC on the supply side, and pinched demand from major customers tied to high prices and soft economic growth. However, a new storm was brewing in the Gulf of Mexico, which could keep the bears in check. Elsewhere on the commodity inflation front, platinum prices tumbled 5% overnight as concerns about a global slump in the automotive industry take hold. Copper prices – which are a key indicator of global demand – slumped to 4-month lows. There was some thought that demand from China would basically be at a standstill for a few weeks for the Olympics, which kick off later this week. Also, orange juice and coffee futures were taking a hit this morning, so physical goods price pressures were not a big concern early today for equities.

Small-cap stocks posted a solid rally Tuesday, bolstered by sinking crude oil prices, a strong dollar and enthusiasm over a steady spate of merger and acquisition activity. The Russell 2000 (NYSE:IWM) rose 19.19, or 2.75%, to 716.82, marking the 9th-largest one-day gain of the year.

The recovery bounce in stocks from a morning slide was clearly paced by small caps as the Russell 2000 moved into the green well ahead of its large-cap brethren — and even well before the crude oil collapse gained momentum.

“Crude was helpful to sectors in the market, but today’s action was also dominated by a wave of earnings. The lack of material downside follow through in the financial sector post Wachovia, Keycorp and American Express sparked a bid. The market was able to shrug off the initial bearish news with surprisingly little downside, which is a big positive. In addition, M&A activity is perking up,” said Nick Kalivas, vice president, financial research with MF Global.

Kalivas said that the deal by Brocade Communications Systems (Nasdaq:BRCD) to purchase Foundry Networks Inc. (Nasdaq:FDRY) helped secure a positive tone for the market, particularly in small caps. FDRY gapped higher on huge volume today, and added some 30% to its market cap on the news.

Several airline stocks are in the small- to mid-cap range, and those stocks really took flight today as crude oil tanked. The AMEX Airline Index shot 22% higher today, and small-cap carrier US Airways (NYSE:LCC) jumped a whopping 59% despite reporting huge — but not surprising — quarterly losses. Small-cap firm Alaska Air Group Inc. (NYSE:ALK) was up 19%, while JetBlue Airways Corp. (Nasdaq:JBLU) rallied 20% and UAL Corp. (Nasdaq:UAUA) gained some 63%.

As for crude oil, the market for black gold went into a tailspin, sinking some 3% to 6-week lows. Clearly, the rise in the U.S. dollar went hand-in-hand with the plunge in crude, but one could argue that the dollar rally also played in a role in pulling down commodity prices across many markets. For instance, corn was down 3%, sugar down 3%, orange juice down 2.7% and even gold reversed overnight gains to . . .

After a rocky morning for small caps, stocks edged higher, lifted by plunging crude prices and gains in consumer and retail companies. At 12:46 p.m. ET, the Russell 2000 (NYSE:IWM) was up 8.85, or 1.27%, at 706.48.

The price of crude oil sank $5 per barrel to $126 at mid-session to a six-week low. Weather forecasts predicted Tropical Storm Dolly will likely miss oil fields and refineries along the Gulf Coast. Previous reports warned the storm would come close to the area, possibly disrupting oil production.

Airline companies jumped on the news with Continental Airlines Inc. (NYSE:CAL) and JetBlue Airways Corporation (Nasdaq:JBLU) soaring more than 20% as the fuel costs showed the first signs of decreasing.

Financial stocks took a hit today after the Congressional Budget Office said it could cost the government as much as $25 billion to help troubled Fannie Mae (NYSE:FNM) and Freddie Mac (NYSE:FRE). Congress will vote this week on whether Fannie and Freddie will receive government assistance. U.S. Treasury Secretary Henry Paulson said today that action must be taken to boost consumer confidence while strengthening the housing market.

Mortgage losses brought down Wachovia Corporation (NYSE:WB), which posted an unexpected second-quarter loss today of $8.9 billion and announced plans to eliminate 6,350 workers. Investors took solace in the fact that $6.1 billion of that was from a goodwill impairment charge.

Among broad market sectors on the rise are airline transportation; recreational activities; accident and health insurance; and home improvement retailers. Heading downward are coal; oil and gas operations; computer hardware; and computer storage devices.

Small caps leading the pack include Bluegreen Corporation (NYSE:BXG), which is up 90% today’s trading after announcing ahead of the opening its plans . . .

Small-cap stocks are expected to open sharply lower, pulled down by a spate of disappointing earnings, particularly in the tech sector. In addition, the recent run of bullish surprises on the banking front appears at risk on soft results from Wachovia Corp. (NYSE:WB). The Russell 2000 (NYSE:IWM) was off about 0.8% in overnight action, which would suggest an opening near 691.50.

On the tech front, bellwether Apple Inc. (Nasdaq:AAPL) was clobbered overnight, sinking some 9% when the maker of iPods projected forward earnings below the Street forecast. Vodafone Group PLC (NYSE:VOD) tumbled some 14% during European trading as the company lowered its outlook. Also, Texas Instruments (NYSE:TXN) failed to meet earnings projections and was off some 11% in after-hours trading. Heading into the open, the tech-laden Nasdaq futures market was flirting with 2% losses.

The banking sector has been rejuvenated in recent days by a string of positive earnings surprises, including Wells Fargo & Co. (NYSE:WFC), JP Morgan (NYSE:JPM), Citigroup (NYSE:C) and Bank of America (NYSE:BAC). However, that momentum should be halted today as shares in Wachovia Corp. (NYSE:WB), the fourth-largest U.S. bank, slumped 6% in overnight trading as the firm’s earnings disappointed and the bank slashed its dividend. Also in the financial sphere, American Express (NYSE:AXP) flirted with double-digit declines overnight after earnings missed . . .

Small-cap stocks plunged shortly after Friday’s opening, showed resilience during the first hour of trading but have exhibited a downward trend in afternoon trading. The uncertainty surrounding Fannie Mae (NYSE:FNM) and Freddie Mac (NYSE:FRE) combined with record-high crude oil prices have spurred a sell-off today. At 2:17 p.m. ET, the Russell 2000 (NYSE:IWM) was down 2.07, or 0.31%, at 668.37.

Investors responded tepidly to Treasury Secretary Henry Paulson’s short statement that the U.S. government is committed to “supporting Fannie Mae and Freddie Mac in their current form as they carry out their important mission.”

Fannie Mae has fallen some 24% this afternoon, and similar losses were pinned on Freddie Mac on high volume. Selling fury was fueled overnight by an article in the New York Times suggesting the government was considering a takeover of the embattled mortgage lending giants as the housing slump and credit crisis wallop the firms.

The freefall in federally chartered corporations, or GSEs, spilled over to the rest of the financial sector, with large caps such as Wachovia Corp. (NYSE:WB) down 9%, Merrill Lynch down 5% and Lehman Bros. (NYSE:LEH) off 15% in afternoon trading.

“Retail and credit issues sparked selling Thursday and remain a concern today. Volatility is high right now,” Nick Kalivas, vice president of financial research with MF Global, told SmallCapInvestor.com in an email interview. “I think FNM and FRE are vulnerable to further losses, but the market is thinking that the government will aid the GSEs in some way and keep the financial system whole.”

Small caps were able to outperform large caps during Thursday’s bounce, but Kalivas said the move was powered more by a recovery in oil and natural gas that sparked money pouring back into small-cap energy firms. “I think it is more a beta trade or a sector trade than a sign of the market’s overall health. I’m not reading . . .

Small-cap stocks plunged early Friday as a downward spiral developed among government-sponsored mortgage firms and record high crude oil prices sent equity bears on a stampede. At 10:00 a.m. ET, the Russell 2000 (NYSE:IWM) was down 3.09, or 0.46%, at 667.35, an ugly start to the day, but well off the initial morning lows.

The Michigan sentiment survey came in better-than-expected, with the headline figure at 56.6, compared with the median forecast of 55.5. The stock market appeared to bounce mildly off the lows in conjunction with the Michigan figures, but the market was already trying to mount a recovery move even before the data came out.

Fannie Mae (NYSE:FNM) collapsed some 40% shortly after the open, and similar losses were pinned on Freddie Mac (NYSE:FRE) on huge trading volume. Selling fury was fueled overnight by an article in the New York Times suggesting the government was considering a takeover of the embattled mortgage lending giants as the housing slump and credit crisis wallop the firms.

The freefall in GSEs spilled over to the rest of the financial sector, with large caps such as Wachovia Corp. (NYSE:WB) down 9%, Merrill Lynch down 6% and Lehman Bros. (NYSE:LEH) off 17%. Small-cap index products are peppered with regional and small banks, and they often have even more trouble gaining access to credit than the bigger banks, so heightened fears on the credit crunch could slice into the outperformance seen in the Russell 2000 versus large-cap index products (although in early trade, losses in the Russell 2000 were on a slower pace than its big-cap brethren).

“Retail and credit issues sparked selling yesterday and remain a concern today. Volatility is high right now. I think FNM and FRE are vulnerable to further losses, but the market is thinking that the government will aid the GSEs in some way and keep the financial system whole,” Nick Kalivas, vice president of financial research with MF Global, told SmallCapInvestor.com in an email interview.

“I think earnings news should be the main focus and Thursday’s DOW/ROH deal was bullish, but the credit environment is so uncertain and the market does not see the financing available for a host of deals. The market is cheap based on the M&A, but there may not be the liquidity or money to actually push it higher. That . . .

Small-cap stocks are expected to slump on the open, pulled down by the deepening crisis among government-sponsored mortgage lenders and by another steep rise in crude oil prices overnight. Stock index futures were down about 1% during after-hours trading, which would suggest an open for the Russell 2000 (NYSE:IWM) near 663.50.

The freefall in mortgage firms Fannie Mae (NYSE:FNM) and Freddie Mac (NYSE:FRE) hit a fresh crescendo overnight, with FNM shares off 37% and FRE also tumbling about 37% on a New York Times story that said the U.S. government is considering a takeover of the staggering firms as the housing slump and credit crisis take a toll. The GSE tumult will likely cast a pall over the entire financial sector, and indeed, Wachovia Corp. (NYSE:WB) was off some 8% overnight and Merrill Lynch (NYSE:MER) was down about 2.5%.

Crude oil prices shot more than $3 dollars a barrel to the $145 zone, hitting a fresh record high and recovering $10 dollars in losses from earlier this week in dramatic fashion. Energy prices shot higher the last two days amid supply concerns out of Nigeria and Brazil, and by ongoing geopolitical tension in the Middle East. The sharp upturn in crude oil coincided with a decline in the U.S. dollar, which was down about 0.3% against the euro and about 0.7% versus the yen before the international trade data was released at 8:30 a.m. ET. The slide in the dollar was then extended modestly after the trade report came out. On the data front, the Michigan sentiment survey comes out later this morning around 10:00 a.m. ET, and could spark a . . .

Small-cap stocks weathered several storms today to punch out a higher close as investors were able to look past a sudden reversal higher in crude oil futures, renewed credit crunch worries amid a collapse in mortgage finance stocks and safe-haven money flow into short-dated treasury products. Oversold conditions and bargain hunting spurred by merger activity were enough to pull small-cap stocks into the green. The Russell 2000 (NYSE:IWM) rose 6.68, or 1.01%, to 670.44.

Heading through midday trading, the market tried to carve out a modest recovery rally in the wake of Wednesday’s big collapse, but a sudden afternoon surge in crude oil prices stomped out bullish sentiment in equities — at least for a while. Crude oil prices charged more than $5 a barrel higher, climbing back above $141 on supply concerns out of Africa and Brazil and amid ongoing tension in the Middle East.

Workers in Brazil threatened to initiate a five-day strike next week, while a ceasefire in Nigeria threatened supply from Africa. Meanwhile, Iran said it has been test-firing more missiles, as a “lesson for enemies;” U.S. officials warned Iran that it would defend its allies. The potential for supply disruption and geopolitical tension was enough to spark the sudden resurgence in crude oil prices, which had tumbled some $10 a barrel off recent record highs.

S&P 500 futures actually made their daily high this morning before the regular market even opened, rising to highs in conjunction with a better-than-expected headline figure on the weekly jobless claims report. The report showed a decline in claims to 346,000 which was much better than the 395,000 forecast and a big improvement on last week’s 404,000 figure. However, there were some “devils in the details” of the data, which hinted that all is not well in the labor market.

“Continuing claims, which lag initial claims by one week, rose 91,000 to 3.202 million. The insured unemployment rate moved up to 2.4% from 2.3% in the prior week. The insured unemployment rate has held at 2.4% in three out of the last five weeks. The noticeable decline in initial claims is a distortion and is not an indicator of a market improvement in labor market conditions,” Asha Bangalore, economist . . .

Small-cap stocks pushed higher in morning trade, overcoming ongoing fears about the credit crunch, particularly as they relate to slumping home financing providers Fannie Mae (NYSE:FNM) and Freddie Mac (NYSE:FRE). At 10:02 a.m. ET, the Russell 2000 (NYSE:IWM) was up 4.84, or 0.70%, at 668.39. Shortly after the open, FNM shares collapsed 16%, while FRE was down 18%.

Buyers in the stock market seemed to gain some confidence on news that Federal Reserve Chairman Ben Bernanke’s congressional testimony today will show that the central bank remains focused on financial market turmoil. Wire service reports said that Bernanke would push to let the government “liquidate” any major firm on the cusp of bankruptcy.

The morning seemed full of promise just one hour before the regular opening, with stock index futures charging higher on M&A news, an improved outlook from consumer barometer Wal-Mart (NYSE:WMT) and a bullish surprise on the headline weekly claims report. However, the market turned south about 30 minutes ahead of the open as the credit crunch jitters overtook investor psychology amid talk that FNM and FRE were approaching insolvency. Spreads traded on the firms in the debt market widened substantially after former Federal Reserve official William Poole said the firms may need to be bailed out.

Stock index futures made the overnight high when the weekly claims report came out at 346,000, which was much better than the forecast for 395,000, and which should have alleviated some of the recession fears fanned by last week’s stunning 404,000 claims report. However, continuing claims remained above 3 million, which underscores a difficult labor market picture.

Wal-Mart’s June same-store sales jumped 5.8%, which surpassed analyst expectations for a rise of 3.8%. The retailer followed up the strong sales news by raising their second-quarter outlook, which sparked a rally in overnight trading in WMT, but the stock was basically flat early on today after the open. There is some concern that the bump in WMT June sales may have been bolstered artificially by the fiscal . . .

Small-cap stocks ended the week with a whimper, pulled down by surging crude oil prices, an ongoing rout in financial stocks, sinking tech stocks and safe-haven money flow away from equities and into credit instruments. The Russell 2000 (NYSE:IWM) stumbled 12.10, or 1.64%, to 725.73, notching the second-largest one-day decline since June 6.

It’s probably no coincidence that the big decline exactly two weeks ago on June 6 also coincided with talk that Israel was developing plans to possibly attack Iran’s nuclear facilities, which sparked a rally in energy markets and also played into geopolitical tensions ahead of a weekend.

The reversal in crude oil prices meant that Thursday’s slide in energy markets was a very brief respite for consumer, airline and courier shares that have been mercilessly battered by soaring gasoline prices. The rise in crude oil was accompanied by a sharp decline in the U.S. dollar, which tumbled about 0.7% against both the euro and the Japanese yen.

Financial shares were under attack once again today following a downgrade in the outlook for banks by Merrill Lynch analysts. Citigroup (NYSE:C) was off 4.7%, Bank of America (NYSE:BAC) down 3.7% and Wachovia (NYSE:WB) off nearly 2%. Investment banks, brokerage firms and specialty trading houses were also under pressure, with JP Morgan (NYSE:JPM) down about 2%, Goldman Sachs (NYSE:GS) off 1.6% and Lehman Bros. (NYSE:LEH) down 1%. Small-cap firm MF Global (NYSE:MF) sank 22% and continues to reel in the face of analyst downgrades and slumping interest rate income from futures trades. Ironically, Merrill Lynch (NYSE:MER) itself was down 4.6%.

With the market taking a beating today and the crude oil market rising amid political concerns, the quarterly “quadruple witching” expirations shuffled into the background a little bit. That said, the market certainly was volatile today, be it from expirations or other factors. The NYSE said that short interest was at an all-time high, . . .

Small-cap stocks took a dive on the opening, pulled under water by yet another selling flurry in the financial sector, a recovery bounce in crude oil, declines overnight on international equities and safe-haven flow out of stocks into bonds. At 10:10 a.m. ET, the Russell 2000 (NYSE:IWM) was down 12.96, or 1.76%, at 724.87.

This morning’s whipping post for the financials was Merrill Lynch (NYSE:MER) and shares in the investment banking firm were down 5.2% shortly after the opening. The market seems to be rotating around various financial stocks, but the whole group is also being punished as investors shy away from the group amid the ongoing credit crunch. Rival investment banks Goldman Sachs (NYSE:GS) and JP Morgan (NYSE:JPM) were both in the red early today as well. Ironically, even as Merrill is a target for the bears this morning, their own analysts issued bearish news on several banks, forecasting dividend cuts and lowering price targets. Wachovia (NYSE:WB) was off 5% and Bank of America (NYSE:BAC) was down 4%.

During Thursday’s session, crude oil futures offered an olive branch to stock market bulls via the largest one-day slide in about three months, but the market for black gold rallied back some overnight, climbing above $136 dollars a barrel heading toward the U.S. stock market opening. There was some talk once again about Israel planning a strike against Iran’s nuclear facilities; those rumors were in the news back on June 6 when crude oil jumped.

The stiff bounce in crude oil was accompanied by a sinking U.S. dollar, which lost 0.7% against the euro and about 0.5% versus the yen. The sinking dollar also could support a wide range of other commodity markets heading into the weekend.

Stock markets around the world were on the defensive overnight, with Japan down 1.3%, Taiwan off 1.8%, Australia down 1.4%, India down 3.4%, Hong Kong down 0.2%, South Korea down 0.6%. China shares did bounce 2.7%, but that . . .

Small-cap stocks are expected to open sharply lower, pulled down by renewed concerns within the financial sector, a reversal in crude oil prices and slumping equity markets around the world overnight. The Russell 2000 (NYSE:IWM) was off about 0.6% in after-hours trading, which would translate to an opening near 733.00.

There were wire service rumors this morning that Merrill Lynch (NYSE:MER) could issue a profit warning. Merrill Lynch shares were off 3.8% in overnight action and other investment banking houses such as Goldman Sachs and JP Morgan were both off some 1% in after-hours action. Also on the financial front, Merrill Lynch analysts are forecasting dividend cuts at several banks and lowering its price target for Wachovia (NYSE:WB), saying that bank stocks were in “capitulation” mode. Wachovia shares were down some 4% in after-hours trading. Bank of America (NYSE:BAC) shares were down more than 2% overnight.

Crude oil prices reversed course this morning after notching the largest one-day decline in a quarter Thursday. Crude oil was up more than $2 a barrel heading toward the stock market opening, rising back above $134. The rise in crude oil was accompanied by a slide in the U.S. dollar, which tumbled more than 100 basis points, or 0.7% versus the euro and was also down about 0.5% against the . . .

Small-cap stocks plunged on the opening, pulled down by hawkish inflation comments overnight from Federal Reserve Chairman Ben Bernanke, who said that the central bank will resist rising long-term inflation. His comments stoked stagflation fears and sent a shiver through already embattled financial shares, which fear higher interest rates. At 9:56 a.m. ET, the Russell 2000 (NYSE:IWM) was off 4.77, or 0.65%, at 730.48.

Bernanke also said that the risk of a substantial downturn in the economy has eased, which hints that the Fed has shifted into a “fight inflation” mode. If so, then the next move from the Fed could be a rate hike, which would raise the price of money, boost rates and seemingly support the U.S. dollar. Indeed, the greenback jumped overnight on the Bernanke remarks, climbing to three-month highs against the yen, and rising about 0.9% versus the euro. The dollar managed to remain higher despite a sloppy monthly trade report, which showed the U.S. deficit climb to $ 60.9 billion, above the forecast for a deficit of $59.9 billion.

Despite the jump in the U.S. dollar this morning, crude oil prices were higher, rising back above $137 overnight as supply jitters countered softer demand from lofty prices. The OPEC Secretary General said the energy market was “panicking” and that there was no shortage of oil now or in the future. That said, Russia’s Gazprom, which supplies a quarter of Europe’s natural gas, predicted crude oil prices could double within 18 months, reaching $250 dollars a barrel in 2009. Right into the U.S. stock market opening, crude oil prices did pull off the highs, and gold was down $2 dollars. As the day progresses, it will be interesting to see if commodity markets are shaken by the Fed’s heightened inflation focus and the upside pop in the dollar. From a long-term perspective, the dollar is still historically low, which bolsters demand for many commodity goods that are priced in dollar units.

Right now, investors are concerned that the United States could limp into a stagflation stage in which high prices combine with a stagnant economy to cripple corporate input costs and rob consumer purchasing power. These fears are also surfacing at a time when small caps are coming off six-month highs, perhaps providing a higher . . .

Though major stocks are trading generally higher, small caps have continued sliding in midday Monday trading. A drop in crude oil prices and a better-than-expected report on pending home sales for April was not enough to rally small-cap stocks. At 1:37 p.m. ET, the Russell 2000 (NYSE:IWM) was down 4.11, or 0.56%, at 736.26.

Crude oil prices were off more than $2 dollar a barrel into midday trading, slipping to $136.34 a barrel in recent action. The price decline is a welcome sign following Friday’s historic surge in energy prices and national pump prices breaking the $4 barrier over the weekend.

Small-cap investors were encouraged by a better-than-expected report on April pending home sales in early trading, but gains were lost shortly thereafter. Pending home sales rose 6.3% in April, according to the National Association of Realtors. Analysts anticipated a dip of 0.3%.

A big acquisition deal among large-cap insurers also boosted investor psychology. Willis Group Holdings (NYSE:WSH), the world’s third-largest insurance brokerage, announced a deal to buy rival Hilb, Rogal and Hobbs Co. (NYSE:HRH) for $1.7 billion, news that sent HRH shares soaring some 44% on the opening.

In Monday midday trading, the U.S. dollar was up against the yen and the euro. The greenback slid during last week’s trading as European central bankers talked up rate hikes after Fed Chairman Ben Bernanke spoke about a desire to strengthen the dollar. In recent trading against the euro, the U.S. dollar was up to $1.5637.

Andy Busch, BMO Capital Markets’ foreign exchange strategist, said investors are watching oil and food prices as inflation indicators.

“In normal business cycles when the unemployment goes up, we focus on indicators that provide us insight into spotting a turnaround like housing or auto sales or durable goods,” Busch said. “However in the financial markets, we're focusing more on inflation from energy and food than on whether the economy has bottomed. So things . . .

Small-cap stocks were unable to sustain a mild opening upside brush as support from a dip in crude oil prices was countered by concerns over the credit crunch impact on financial companies. At 10:02 a.m. ET, the Russell 2000 (NYSE:IWM) was down 0.31, or 0.04%, at 740.05.

Crude oil prices were off some $3 dollar a barrel into the U.S. stock market open, slipping below $136 dollars a barrel, a welcome sign following Friday’s dramatic surge in energy prices and national pump prices breaking the $4 barrier over the weekend.

A mild uptick in equity index prices took place after April pending home sales were reported up 6.3%, well above the forecast for a dip of 0.3%.

A big acquisition deal among large-cap insurers also boosted investor psychology. Willis Group Holdings (NYSE:WSH), the world’s third-largest insurance brokerage, announced a deal to buy rival Hilb, Rogal and Hobbs Co. (NYSE:HRH) for $1.7 billion, news that sent HRH shares soaring some 44% on the opening.

The U.S. dollar was firm versus the yen into the stock market opening, gaining some 1.3% and up about 0.5% against the euro. The greenback took a big hit late last week, as European central bankers talked up rate hikes after Fed Chairman Ben Bernanke spoke about a desire to strengthen the dollar, which told foreign exchange traders that the world’s policy leaders were not in step with each other.

Stock markets around the world took a hit overnight, catching up with the big slide in U.S. equities from Friday. Japan shares were off 2.1%, Taiwan down 1.8%, Singapore down 1.9% and Bombay slumped 3.2%. Markets in Hong Kong, China and Australia were closed for holidays. However, European stocks were tame given the global rout in play.

The fact that European stocks were able to hold together relatively well overnight supported U.S. stocks this morning, as did the oversold condition from Friday’s big slide, according to Scott Fullman, director of derivatives with WJB Capital Group. “The market has been difficult to call because of volatility and the close ties to crude oil prices,” Fullman said in a phone interview with SmallCapInvestor.com. He suggested looking at trades to hedge against a potential downturn in stocks amid a . . .

Small-cap stocks are expected to open higher today, bolstered by ideas that Friday’s massive downside rout was overdone and by a dip in crude oil prices overnight. The Russell 2000 (NYSE:IWM) was up about 0.2% in after-hours trading, which would translate to an opening near 741.85.

Crude oil pulled back about $1 dollar a barrel overnight and was near $137, which might be a relief to the market after Friday’s surge to fresh record highs. Still, gasoline pump prices pulled north of $4 dollars a gallon on a national basis this weekend, which threatens to crimp consumer discretionary spending this summer.

Traders will keep a close eye on how Lehman Bros. (NYSE:LEH) trades today after the embattled brokerage firm announced plans to raise $6 billion in capital overnight. The stock was down about 7% in after-hours trading on the news. Banking stocks could be on the defensive following analyst downgrades for Citigroup (NYSE:C), Wachovia (NYSE:WB) and JP Morgan (NYSE:JPM).

On the merger and acquisition front, Willis Group Holdings (NYSE:WSH), the world’s third-largest insurance brokerage, announced a deal to buy rival Hilb, Rogal and Hobbs Co. (NYSE:HRH) for $1.7 billion, news that sent HRH shares soaring some 40% overnight.

The chart picture looks heavy after Friday’s big reversal, but short-term momentum indicators are oversold, which could spark a corrective bounce. The key line to watch early this week is still at 750. Also, the 20-day moving average is near 739.17 . . .

Small-cap stocks pushed lower Monday as credit crunch fears resurfaced, igniting a flurry of selling in the financial sector that spread into several other arenas as well. The Russell 2000 (NYSE:IWM) tumbled 7.25, or 0.97%, to 741.03. For much of the day, small caps appeared set to generate the largest one-day percentage decline in nearly a month, but some late buying in the final half-hour lifted the market well off the intraday lows.

Renewed concerns about the credit crisis originated overseas in the United Kingdom when Bradford & Bingley (LON:BB), a large mortgage provider for residential rental units said that housing market woes are deepening. Shares in Bradford & Bingley tumbled 24% and sparked selling enthusiasm in various European banks.

Selling in financial shares picked up additional momentum when Standard & Poor’s lowered credit ratings on some key U.S. securities firms. Lehman Bros. (NYSE:LEH) shed over 7% on the ratings news, while Morgan Stanley (NYSE:MS) and Merrill Lynch (NYSE:MER) both lost over 3%.

In addition to the concerns over mortgage houses, brokerage firms and other financial shares, a couple of major American banks changed up top management leaders, which also shook up the market. Wachovia Corp. (NYSE:WB) ousted its CEO and the stock slid about 2%. Meanwhile, Washington Mutual (NYSE:WM), said it would strip away the title of chairman from its chief executive next month. Washington Mutual shares dipped to their lowest level since mid-March on the news, but bounced back to close near steady levels.

Even though the credit crunch concerns dominated investor psychology today, a reversal in crude oil from overnight losses probably didn’t help matters for the bulls. Crude oil climbed back to nearly $128 dollars a barrel, while gold pushed higher. In addition, wheat futures jumped 2.7% and corn rallied about 2.6%. The Commodity Research Bureau Index climbed 0.85% and is just slightly below the record . . .

Small caps opened lower, and remained in the red even after manufacturing data came out better than expected. The tone for a lower opening was forged overnight as credit crunch worries resurfaced in Europe and spilled over into investor psychology in the United States. At 10:05 a.m. ET, the Russell 2000 (NYSE:IWM) was down 8.02, or 1.07%, at 740.27.

The ISM Manufacturing Survey came out at 49.6, which was up from 48.6 last month, and well above the forecast of 48.5. Stocks trimmed losses just slightly after the number came out, but were unable to muster enough buying to dramatically cut into the opening losses as the sellers continued to dominate action even after the report. Construction spending data also came out this morning and was down 0.4%, slightly better than the forecast for a loss of 0.6%

The ISM data this morning was just the first salvo in a week chock full of big economic reports. As the week progresses, investors will have a chance to decipher data on manufacturing, vehicle sales, productivity and employment.

Bradford & Bingley (LON:BB), the largest mortgage lender to residential rental units, tumbled some 25% overnight and said that the housing market was getting worse, not better. The slide in mortgage lenders spilled over to the banking arena and to other financial shares as well. In the United States early losses were seen in JP Morgan (NYSE:JPM), which was off 0.9%. Also, Wachovia (NYSE:WB) opened down 3.3% on news that the bank’s CEO was terminated.

Large caps in the news to start the week included General Motors Corp. (NYSE:GM), which rallied 4% early after a bullish article in Barron’s.

The U.S. dollar was in a rally mode before the ISM data, and retained gains against the euro and yen after the report. The dollar was up about 0.3% against the euro and up nearly 0.8% versus the yen. In general, a strong dollar of late has been linked to a positive for equities, suggesting an unravel of the long commodities/short dollar trade and a better tone for the struggling U.S. economy.

Speaking of commodities, the firm dollar sparked a retreat in many dollar-denominated physical markets, including crude oil, which slipped in overnight action and . . .

Small-cap shares opened lower, pulled down by soaring crude oil prices, troubling economic data, a decline in overseas equities and a sinking greenback. At 9:52 a.m. ET, the Russell 2000 (NYSE:IWM) was off 3.25, or 0.44%, at 735.20.

Crude oil jumped to a new record high, climbing above $129 dollars a barrel amid tight stocks for diesel fuel and solid demand out of China and South America that is countering soft demand from the United States. With gasoline prices in some metropolitan areas moving above $4 dollars a gallon, another record high in crude oil will not likely be embraced by stock market traders, even if a handful of energy stocks stand to benefit.

This morning’s PPI report was a mixed bag at first glance, with the headline figure coming in at 0.2%, which was better than the forecast for a rise of 0.4%. However, with gasoline prices still soaring, that figure already seems out of date, and investors were much more concerned about a jump in the “core” PPI, which climbed to 0.4% — above the forecast for a rise to 0.2%. The core rate excludes food and energy prices, which means there are other price pressures in the pipeline to be concerned about as well. This jump in the core tightens margins for businesses and forces them to consider raising prices, which can be suicidal in a sluggish economy where consumer discretionary spending is already pinched by lofty food and energy costs.

Other economic data this morning also had a soft tone, as weekly chain store sales were off 0.4% last week, according to the International Council of Shopping Centers. In addition, the Chicago Federal Reserve National Activity Index slipped to minus . . .

The Russell 2000 (NYSE:IWM) closed lower on news that Wachovia Corp. (NYSE:WB) suffered a first-quarter loss. The small-cap index fell 2.09 points, or 0.30%, to 686.07. The Dow Jones Industrial Average declined 23.36 points, or 0.19%, to 12,302.06.

On a year-to-date basis, the Russell 2000 has shed 10.44%, while the Dow is off 7.26% and the S&P 500 is down 9.54%.

The bears and the bulls tangled but the bears were eventually victorious as investors reacted to news before the opening that Wachovia Corp. (NYSE:WB) swung to a first-quarter loss and will sell common and preferred stock to raise capital.

The Charlotte, N.C.-based bank has been relatively less exposed to the subprime mortgage mess than the other major financial institutions, leading to speculation that more players will report losses.

Banks were among the worst hit industry groups today. Among those . . .

The Russell 2000 (NYSE:IWM) has surprisingly zoomed ahead. At 1:19 p.m. ET, the small-cap index had added 3.57 points, or 0.52%, to 691.73. The Dow Jones Industrial Average was up 19.22 points, or 0.16%, to 12,344.64.

Small-cap stocks abruptly moved into the green at around 12:30 p.m. ET, with no apparent reason explaining the sudden spike. The index was in negative territory for most of the morning.

The major bearish news came before the start of trading when Wachovia Corp. (NYSE:WB) reported that it swung to a first-quarter loss, adding that it will sell common and preferred stock to raise capital.

There was also bullish news, coming in the form of a report by the U.S. Census Bureau before the opening that retail sales unexpectedly rose 0.2% in March. However, investors were not impressed because the increase was largely due to a jump in sales at gasoline stations.

The Russell 2000 (NYSE:IWM) has pared some of its earlier losses as investors take a second look at economic and financial data.

At 11:48 a.m. ET, the small-cap index was down 0.70 points, or 0.10%, to 687.46. The Dow Jones Industrial Average was off 21.90 points, or 0.18%, to 12,303.52.

Small-cap stocks began the session lower but have since been moving erratically, twice briefly venturing into the green, as investors try to make sense of mixed news.

The major bearish news came before the start of trading when Wachovia Corp. (NYSE:WB), the fourth-largest U.S. bank, reported that it swung to a first-quarter loss. The Charlotte, N.C.-based company also cut its dividend and said that it will sell common and preferred stock to raise capital.

The announcement led to declines in the financial services sector. Among those whose stock price is sagging is small-cap multi-bank holding company . . .

The Russell 2000 (NYSE:IWM) is in negative territory despite mixed economic and financial news.

At 10:12 a.m. ET, the small-cap index was down 1.69 points, or 0.25%, to 686.47. The Dow Jones Industrial Average was down 1.14 points, or 0.01%, to 12,324.28.

Small-cap stocks opened in the red as news of a major bank feeling the pinch from the subprime mortgage debacle apparently outweighed news of unexpectedly strong March retail sales.

Wachovia Corp. (NYSE:WB) reported before the start of trading that it swung to a first-quarter loss. The Charlotte, N.C.-based bank also cut its dividend and said that it will sell common and preferred stock to raise capital.

However, there is also bullish news, coming in the form of a U.S. Census Bureau report before the opening that U.S. retail sales unexpectedly . . .

The Russell 2000 (NYSE:IWM) futures are lower but have been moving up following mixed economic and financial news.

The bears and the bulls are doing battle in pre-market trading. The bears are reacting to news this morning that Wachovia Corp. (NYSE:WB) swung to a first-quarter loss. The Charlotte, N.C.-based bank will sell common and preferred stock to raise money.

Futures fell but started improving on news before the opening that U.S. retail sales unexpectedly rose 0.2% in March, according to the U.S. Census Bureau. Economists were expecting sales to stay flat.

The Russell 2000 came under heavy selling pressure Friday, sinking 19.26, or 2.72%, to 688.16. Look for key support Monday at 681, then down at 672. On the upside, resistance is at 696, then at 705 and 712.

This week is full of big economic releases and the Retail Sales data could set the tone for the week ahead. The 10:00 a.m. ET Business Inventories report doesn’t carry the kind of volatility of the Retail Sales release, but could spark a mild bobble in equities.

The Russell 2000 (IWM) and the other major U.S. indices closed with a loss following economic and financial news. The small-cap index let go 7.04 points, or 0.96%, to 723.46. The Dow Jones Industrial Average (INDU) declined 108.03 points, or 0.85%, to 12,635.16.

On a year-to-date basis, the Russell 2000 has lost 5.88%, while the Dow has retreated 4.75% and the S&P 500 has shed 5.96%.

Stocks small and large interrupted two days of solid gains today as investors consolidated their positions and reacted to news of a wave of downgrades in the financial sector.

Trading began on a bearish note and the Russell 2000 spent the entire session in negative territory following news that UBS AG (NYSE: UBS) downgraded credit card issuer American Express Co. (NYSE: AXP) to “sell” from “buy.”

McLean, Va.-based rival Capital One Financial Corp. (NYSE: COF) suffered the same fate, its stock downgraded to “sell” from “neutral” due to the possibility of a consumer-led recession and a rise in unemployment. The same goes for Discover Financial Services (NYSE: DFS), another card issuer.

As if all that was not enough to cement the bears’ dominance, Moody’s Investor Services suggested that it may downgrade a wholly-owned unit of Charlotte, N.C.-based bank Wachovia Corp. (NYSE: WB).

The Russell 2000 (NYSE: IWM) is sagging as investors consolidate previous gains and react to news from the financial sector. At 1:26 p.m. ET, the small-cap index had declined 5.88 points, or 0.80%, to 724.62. The Dow Jones Industrial Average (INDU) was missing 100.55 points, or 0.79%, to 12,642.64.

Stocks are in the red following two consecutive sessions of strong gains and investors apparently don’t see any reason for another buying spree.

The financial sector is looking gloomy on news before the opening that UBS AG (NYSE: UBS) downgraded credit card issuer American Express Co. (NYSE: AXP) to “sell” from “buy,” while Moody’s Investor Services suggested that it may do the same to a wholly-owned unit of Charlotte, N.C.-based Wachovia Corp. (NYSE: WB).

Meanwhile, the U.S. Census Bureau reported after the start of trading that new orders for manufactured goods increased a less-than-expected 2.3% in December.

The numbers represent the biggest jump since July but are below the 2.5% forecasted by economists. Factory orders increased an upwardly revised 1.7% in November.

Orders for durable goods, which are intended to last at least three years, jumped 5%, while orders for manufactured nondurable goods decreased 0.4%.

Leading the way down are retail stocks, while companies representing the energy sector are among the fastest gainers.

The Russell 2000 (NYSE: IWM) and the other major U.S. indices are in the red as investors sell financials and focus on the economy.

At 11:17 a.m. ET, the small-cap index was down 3.84 points, or 0.53%, to 726.66. The Dow Jones Industrial Average (INDU) had shed 41.46 points, or 0.33%, to 12,701.73.

New orders for manufactured goods increased 2.3% in December, the U.S. Census Bureau reported after the start of trading. That’s a rise of $10.1 billion to $441.6 billion.

The numbers represent the biggest jump since July but are nevertheless below the 2.5% forecasted by economists. Factory orders increased an upwardly revised 1.7% in November.

Orders for durable goods, which are intended to last at least three years, jumped 5% after a lackluster rise of 0.5% in November.

The data tells us that the manufacturing sector is holding up.

Contributing to the bearish sentiment is news before the start of trading that analysts suggest selling shares of banks and other financial companies.

Brokerage house Merrill Lynch & Co., Inc. (NYSE: MER) said that shares of Wells Fargo & Co. (NYSE: WFC) and Wachovia Corp. (NYSE: WB) are overpriced, while UBS AG (NYSE: UBS) downgraded American Express Co. (NYSE: AXP) to “sell” from “buy.”

Meanwhile, the White House released its proposed $3.1 trillion federal budget for fiscal 2009, which begins in October.

The Bush Administration expects the budget deficit to reach $410 billion in the current fiscal year and $407 billion in fiscal 2009. The deficit in fiscal 2007 was $162 billion.

The draft budget would make the 2001 and 2003 tax cuts permanent and close numerous government programs. However, it’s likely that the Democratic U.S. Congress will disregard many of the president’s proposals.

The Russell 2000 (NYSE: IWM) and the other major U.S. indices began the day in negative territory.

At 9.55 a.m. ET, the small-cap index was down 7.09 points, or 0.97%, to 723.41. The Dow Jones Industrial Average (INDU) had declined 55.36 points, or 0.43%, to 12,687.83.

Stocks are down as investors are waiting for clues about the state of the U.S. economy.

The U.S. Census Bureau will release its report on December factory orders at 10 a.m. ET, about the same time as the scheduled unveiling of President Bush’s 2009 federal budget.

In corporate news, Humana Inc. (NYSE: HUM), the second-largest provider of U.S.-funded health benefits, reported a fourth-quarter profit of $243.2 million, or $1.43 per share, compared with $155 million, or $0.92 per share, a year earlier. The result beats analysts’ estimates and is due to higher enrollment in Medicare plans and lower medical expenses.

However, the financial sector is looking down following news that a unit of Wachovia Corp. (NYSE: WB) may be downgraded by Moody’s Investors Service. Similarly, shares of American Express Co. (NYSE: AXP) sagged in pre-market trading on news that UBS AG has recommended selling the stock.

The Russell 2000 (NYSE: IWM) futures are a hair below the closing level on Friday and the small-cap index will likely open down.

With little corporate or economic news, stocks have little incentive to move either way this morning.

Exciting the bulls is news that Humana Inc. (NYSE: HUM), the second-largest provider of U.S.-funded health benefits, reported a fourth-quarter profit of $243.2 million, or $1.43 per share, compared with $155 million, or $0.92 per share, a year earlier. The result beats analysts’ estimates and is due to higher enrollment in Medicare plans and lower medical expenses.

However, the financial sector is looking down following news that a unit of Wachovia Corp. (NYSE: WB) may be downgraded by Moody’s Investors Service. Similarly, shares of American Express Co. (NYSE: AXP) are sagging in pre-market trading on news that UBS AG has recommended selling the stock.

Investors will also be looking at figures on December factory orders, to be released by the U.S. Census Bureau at 10 a.m. ET, for more clues about the state of the economy.

The Russell 2000 (NYSE: IWM) and the other major U.S. indices are deep in the red amidst recession fears and an interest rate cut.
 
At 10:19 a.m. ET, the small-cap index had fallen 8.88 points, or 1.32%, to 664.30. The Dow Jones Industrial Average (INDU) was down 230.13 points, or 1.90%, to 11,869.17.

Stocks small and large are posting declines due to fears of a U.S. recession and sell-offs on some overseas exchanges.

Increased worries of an economic recession motivated the U.S. Federal Reserve to make an emergency cut in the federal funds rate to 3.50% from 4.25%.

The Fed has not moved to lower its target rate between meetings since September 2001, in the wake of the terrorist attacks. Its next regularly scheduled meeting is on Jan. 29 and 30.

“The Committee took this action in view of a weakening of the economic outlook and increasing downside risks to growth,” the Fed said in a statement. “While strains in short-term funding markets have eased somewhat, broader financial market conditions have continued to deteriorate and credit has tightened further for some businesses and households.”

The Russell 2000 opened with a large drop, losing more than 3% right of the bat, with the Dow posting a slightly smaller loss. But stocks trimmed those numbers and the roles reversed, the Dow now posting a deeper decline.

The Russell 2000 (NYSE: IWM) futures are falling and the small-cap index will open with a drop despite an interest rate cut.

The U.S. Federal Reserve has decided to lower the target for the federal funds rate to 3.50% from 4.25% to calm jittery financial markets and keep the economy from falling into a recession.

“The Committee took this action in view of a weakening of the economic outlook and increasing downside risks to growth,” the Fed said in a statement. “While strains in short-term funding markets have eased somewhat, broader financial market conditions have continued to deteriorate and credit has tightened further for some businesses and households.”

The fact that the U.S. central bank has decided to lower the federal funds rate between its regularly scheduled meetings is a sign of the serious economic and financial problems we’re seeing.

The Fed has not moved to lower its target rate between meetings since September 2001, in the wake of the terrorist attacks. Its next regularly scheduled meeting is on Jan. 29 and 30.

In the late 1990s, the tech world scoffed at the notion that corporate America would ever accept the concept of paying to download software from the Internet. But today, a growing number of small and medium-sized businesses are using on-demand software, or software-as-a-service (SaaS), for convenience and as an effective way to trim IT costs.

Market researcher IDC predicts that SaaS, which currently accounts for less than 2% of the global software market, will grow 25% annually and become a $14.5 billion industry by 2011. The popularity of on-demand software is growing so fast, in fact, that it is beginning to transform the business software industry. The rise of the SaaS delivery model has software giants Microsoft Corporation (Nasdaq: MSFT), Oracle Corporation (Nasdaq: ORCL) and SAP AG (NYSE: SAP) a little nervous; all are plowing billions into efforts to respond to the emerging SaaS threat.

The emergence of the on-demand software trend reflects companies' growing desire for less cumbersome and more economical means of using information technology (particularly, Web-based systems) to their advantage. For example, a new generation of Tech-savvy workers and global talent shortfalls have changed the face of human resources, which has become a hot segment for on-demand software specialists at a time when even a tiny company may have a tangled mess of disjointed IT.

San Francisco, Calif.-based Taleo Corporation (Nasdaq: TLEO) is a developer of on-demand software that helps companies manage their human resources operations. HR is an area that is often challenging for smaller companies with less manpower dedicated to the department and inefficient ad hoc systems — often based on Excel spreadsheets and emails. Taleo software, which is easy to install, manage and integrate with existing software, helps growing businesses bring their human-resources functions up to snuff by simplifying recruitment, screening and tracking chores. The company sells its software directly to customers and through HR outsourcers with which it has established partnerships.

The Russell 2000 (NYSE: IWM) is posting solid gains on news that central banks around the world are pumping cash into money markets. At 2:33 p.m. ET, the small-cap index was up 7.04 points, or 0.92%, to 773.31. The Dow Jones Industrial Average (INDU) had added 67.14 points, or 0.50%, to 13,499.91.

Small-cap stocks are going strong following news before the start of trading that the U.S. Federal Reserve and four other major central banks are joining hands to inject billions into global money markets to boost liquidity and spur lending.

The U.S. central bank will create a Term Auction Facility program to auction term funds to depository institutions against collateral that can be used to secure loans, according to its statement.

The program will provide banks in good financial condition with billions in short-term funds. The loans will be at rates below the rate charged on direct loans from the Fed to banks but will still be backed by the same type of collateral obligations.

A number of major banks have reduced the flow of credit to businesses and consumers following the meltdown in the subprime mortgage market, which left many financial institutions with billions in losses as foreclosures and loan delinquencies made securities backed by subprime mortgages essentially worthless.

The Russell 2000 (NYSE: IWM) moved lower today on news from Wachovia Corp. (NYSE: WB) of more than $1 billion in losses due to the credit crunch. The small-cap index dropped for the third time this week, retreating 8.52 points, or 1.09%, to 772.38. The Dow Jones Industrial Average (INDU) shed 223.55 points, or 1.69%, to 13,042.74.

On a year-to-date basis, the Russell 2000 has lost 1.92%, while the Dow has advanced 4.56% and the S&P 500 has added 2.62%.

The bears dominated the session today following news that Wachovia Corp. expects to suffer additional losses of $1.1 billion in the third quarter due to collateralized debt obligations.

The Charlotte, N.C.-based bank, the fourth largest in the United States, also said that it will write down collateralized debt obligations of about $1.11 per share for the month of October and expects to see loan losses of over $500 million in parts of the country that have been most severely affected by the slump in the housing sector.

The news comes as the latest reminder that the subprime mess continues to plaque the financial system.

The small-cap futures were pointing south and the Russell 2000 joined the other major U.S. indices in opening with a drop.

There was some upbeat economic news today, coming in the form of a surprise narrowing of the U.S. trade deficit. The Commerce Department reported that the deficit declined 0.6% to $56.5 billion in September, the lowest level since May 2005, as exports increased due to a weak dollar and strong growth overseas. In August the deficit stood at $56.8 billion.

The Russell 2000 (NYSE: IWM) is firmly in negative territory this afternoon on news of more credit problems and a drop in consumer confidence. At 2:13 p.m. ET, the small-cap index was off 7.26 points, or 0.93%, to 773.64. The Dow Jones Industrial Average (INDU) was down 122.34 points, or 0.92%, to 13,143.95.

The contagion from the meltdown in the subprime mortgage sector infected Wachovia Corp. (NYSE: WB) today, as the fourth largest U.S. bank announced before the opening that it expects to suffer additional losses of $1.1 billion in the third quarter due  to collateralized debt obligations.

Stocks dropped out of the opening and the bears have not looked back since.

More bad news came in the form of a surprisingly sharp decline in November consumer sentiment. Preliminary data reported by the University of Michigan after the start of trading showed that consumer confidence fell to 75.0 from 80.9 in October. Economists were expecting a more modest decline to a level of 80.

The result, the lowest reading in two years, indicates that American consumers are feeling less confident about the economy and are not as willing to spend money. That’s a bad sign, because consumption comprises about 70% of gross domestic product.

Here are the current biggest percentage gainers and losers among companies with a market cap between $100 million and $750 million:

Biggest percentage gainers:

• Hutchinson Technology Inc. (HTCH), up 16% on news of a rise in fiscal fourth-quarter profit.
• Omega Financial Corp. (OMEF), up 15% on news it is being acquired by F.N.B. Corp. (FNB) for $393 million.
• AMIS Holdings Inc. (AMIS), up 15% on news that third-quarter earnings beat expectations.

Biggest percentage losers:

• Rigel Pharmaceuticals Inc. (RIGL), down 19% despite news of a successful drug trial.
• Home Diagnostics Inc. (HDIX), down 18% on news of an analyst downgrade.
• Virco Manufacturing Corp. (VIRC), down 16%. A company representative could not be reached for comment.

The Russell 2000 (NYSE: IWM) is plummeting on news of more fallout from the meltdown in the subprime mortgage sector.

At 10:22 a.m. ET, the small-cap index had lost 8.23 points, or 1.05%, to 772.67. The Dow Jones Industrial Average (INDU) was down 134.29 points, or 1.01%, to 13,132.

The bears are out in full force today following news before the opening that Wachovia Corp. (NYSE: WB) expects to suffer additional losses of $1.1 billion in the third quarter due to subprime mortgage-related debt. The Charlotte, N.C.-based bank, the fourth largest U.S. bank, said that it will write down collateralized debt obligations of about $1.11 per share for the month of October.

Wachovia also announced that it expects to see loan losses of over $500 million in parts of the country that have been most severely affected by the slump in the housing sector.

The news came as a nasty reminder that the subprime mess continues to ripple through the financial system.

In economic news, the U.S. Commerce Department reported that the trade deficit unexpectedly narrowed in September. The deficit came to $56.5 billion, the lowest level since May 2005 and a decline of 0.6% from $56.8 billion in August. A weak dollar and strong growth overseas helped exports grow more than imports.

The prices of U.S. exports rose 0.9% October from 0.3% in September, according to the Labor Department.

The Russell 2000 (NYSE: IWM) futures are pointing down and the small-cap index will likely open in the red on news of more credit problems.

Wachovia Corp. (NYSE: WB) got the bears ready when it announced this morning that it expects to suffer additional losses of $1.1 billion due to the problems in the subprime mortgage sector. The Charlotte, N.C.-based bank, the fourth largest U.S. bank, said that it will write down collateralized debt obligations of about $1.11 per share for the month of October.

In economic news, the U.S. Commerce Department reported that the trade deficit unexpectedly narrowed in September. The deficit came to $56.5 billion, a decline of 0.6% from $56.8 billion in August. A weak dollar and strong growth overseas helped lift exports.

Here are the biggest percentage gainers and losers in pre-market trading among companies with a market cap between $100 million and $750 million:

Biggest percentage gainers:

• Echelon Corp. (ELON), up 9%.
• Hutchinson Technology Inc. (HTCH), up 8% on news of a rise in fiscal fourth-quarter profit.
• Superconductor Technologies Inc. (SCON), up 7% on news of a joint venture with Hunchun BaoLi Communications Co. Ltd. (BAOLI).

Biggest percentage losers:

• Jones Soda Co. (JSDA), down 19% on news of a third-quarter loss.
• Isilon Systems Inc. (ISLN) down 16% on news it delayed its third-quarter earnings report.
• DTS Inc. (DTSI) down 15% on news that third-quarter results missed expectations.