每日市场点评 --- April 10, 2008

All three major indices ended the session modestly higher. Interestingly, Nasdaq outperformed the broad market this time and it was up 1.3% for the day. The news on the economic front of the day was quite mixed. Luckily, two Dow components raising their earning expectations along with a $9 billion buyout offer in the biotech sector were enough to offset generally disappointing same-store sale results for March.

Start with the weekly jobless claims number. Economists that were afraid of being left behind had revised this number higher almost every week since early January and they expected 383K for the latest report. Instead, the number came at 357K. It seems that the previous week’s reading of 410K might be distorted by the Easter holiday, similar to what happened in late January. But based on recent economic trends, we would rather believe that this week’s drop was temporary and the trend is still pointing to higher weekly claims in the weeks ahead. Separately, the trade deficit for February unexpectedly widened to $62.3 billion while economists called for a drop to $57.5 billion from $58.2 billion in the previous month. Both equity futures and the US dollar were traded lower following the news.

Technologies and transportations were among the biggest winners of the day. Financials once again lagged the broad market as investors remained concerned about the first quarter earnings for the group. The US dollar reversed earlier losses and ended the day higher against most major currencies. The Chinese yuan crossed the 7 yuan/dollar mark for the first time since the peg was removed in 2005. Treasuries were sold off following a very weak demand in the latest auction of Term Securities Lending Facilities. The daily borrowing from primary dealers also dropped $5 billion in the latest week. It seems that liquidity may not be a concern anymore.