每日市场点评 --- June 6, 2008

There is no lack of historical events in 2008, at least to people on Wall Street. Following the biggest single-day price increase in the history of the Nymex, crude re-wrote the history today by jumping another $10.75 and settled at $138.54, a new historical high. However, stock investors were not that lucky. After yesterday witnessing the best day in more than a month, the market today had its worst day in more than 3 months with all three major indices closed lower by around 3%. The obvious scapegoats of today’s sharp sell-off in the equity market were crude oil and unemployment rate, which jumped to 5.5% from 5.0% and the consensus was calling for an increase of 0.1%. But the 0.5% rise in the unemployment rate was mainly due to an influx of students into the job pool that caused the biggest jump in teenage joblessness in 60 years. The closely-monitored nonfarm payrolls actually came at -49K, better than -60K expected. In other job-related data, average workweek was 33.7 hours vs. 33.7 expected; hourly earnings rose 0.3% vs. 0.2% expected. In a separate report, wholesale inventories for April increased at a higher than expected pace of 1.3%, which might give the second quarter QDP a boost.

All major sectors were ending the session lower by at least 1%. Commodities were faring relatively well as a result of record high oil price and a new high in the CRB commodity index, which jumped another 3.6% following yesterday’s 2% gain. On the losing side, we had some usual suspects such as financials and consumer cyclicals, which typically perform poorly in a rising crude environment. Transportations, which was acting successfully against gravity most time this year, joined those usual suspects today. In fact, the Dow Transportation Average had its biggest single-day point drop just one day after closing at a new historical high. Indeed, the world is changing faster than we can imagine. In other markets, the US dollar was lower against most major currencies and treasuries rallied after the typical flight-to-quality. The VIX index jumped more than 25% but at 23.56, it was still too low to trigger a meaningful capitulation rally. The market breath was negative and the volume was on the heavy side.