The stock market got off to a great start Monday with a rally on the first day of trading. There were gains in the Dow, Nasdaq and S&P. The Dow was up 155.91 points, or 1.5%, to 10,583.96. Some say this single day bodes well for the entire year. We will see if the January barometer hold true throughout 2010.
CBS Newsreports that the National Debt has passed the statutory Debt Limit.
The latest calculation of the National Debt as posted by the Treasury Department has - at least numerically - exceeded the statutory Debt Limit approved by Congress last February as part of the Recovery Act stimulus bill.
The ceiling was set at $12.104 trillion dollars. The latest posting by Treasury shows the National Debt at nearly $12.135 trillion.
No doubt the government will soon raise the spending limit. You can always find the latest National Debt number here, here and here.
The wine trade is faced with a massive oversupply of champagne due to overproduction and less demand than usual. ITN's Ben King explains. It is somewhat similar to the problem that hit luxury goods, shoes and services. Ben King says the oversupply should push prices down somewhat but premium champagne sellers fear discounting could hurt their brands. Take a look:
GM and Chrysler each took bailout money from the government. Ford did not accept any bailout money and managed to gain 5% marketshare from Q3 2008 to Q3 2009 according to Fox Business. They did however take some stimulus money for energy efficient cars. WSJ's Matthew Dolan says we are still just on the heels of the bailout and "2010 will be the real test." Take a look:
The Dow has closed above the 10,000 mark for the first time his year and the first time since since Oct. 3, 2008. The index is still 30% below its peak but it is still an upbeat feeling for investors to see the Dow climb from below 7,000 to back above 10,000.
Like a magnet, Dow 10,000 has emerged as a financial force of nature that attracts and repels stock investors during thrilling bouts of profit-induced euphoria and depressing journeys into money-losing despair. The Dow Jones industrials may climb above 14,000. Perform a 15,000 tease. Or plunge to 6500. But ever since its maiden voyage to 10,000 on March 29, 1999, the 113-year-old stock index with the blue-chip pedigree always seems to end up back at the same place: Dow 10,000.
The market closed Wednesday with the Dow up 145 points to 10,016, its first time above 10,000 in a year. The fact that the Dow, a financial icon with a global following, is again north of that key level is significant because seven months ago it was feeling the full brunt of the financial crisis and trading below 7000 – a 12-year low and 53.8% off its October 2007 record of 14,164.53.
The big question is "What Now?" Investors are hoping the Dow stays about the 10,000 mark but it is certainly possible that it could slip right back below 10,000. Dennis Berman talked to Fox Business about what the market milestone means for investors. As Berman says the number looks good from 6,500 but not so good from 14,000. Take a look:
The Dow soared to a new high this week. It climbed 377 points, or 4%, for the week to close at 9864.94.
The Dow climbed four of five sessions this week and ended up 4% over that period, snapping a two-week losing skid.
The market's gains this week have been driven by a promising start to the earnings season from Alcoa, whose shares gained 10% since Monday, and a move by the Reserve Bank of Australia to tighten its key interest rate. Many investors interpreted that move as a sign that the global economy is returning to normalcy following last year's meltdown.
"Much of the earnings we are going to see will depend on the global economy," said Jordan Smyth, a managing director for Edgemoor Investment Advisors. "It seems everyone now expects earnings will continue to exceed expectations and we'll be looking for confirmation that businesses are seeing what we think we're seeing in the economy."
If the Dow climbs to 10,000 that still leaves the index around 30% down from its high point. Even so, many investors will be relieved to see that number again. The stock market seems to indicate the economy is out of the woods but there are still troubling indicators out there in housing, retail and unemployment.
There is concern going forward but the third quarter was very bullish for stocks. The Dow, S&P 500 and Nasdaq each gained over 15% in the third quarter alone. Reuters says the Dow's performance was the best for a quarter since Q4 of 1998.
For the third quarter, the Dow rose 15 percent, the S&P 500 gained 15 percent and the Nasdaq climbed 15.7 percent. The Dow's performance marked its biggest quarterly gain since the fourth quarter of 1998.
Time will tell if the gains hold. Over the next two quarters people will expect to see stronger signs of a recover. Without them stocks could retreat.
No one knows how bad the H1N1 swine flu outbreak will be when it returns this fall. A White House panel told the President it was feasible that the swine flu could kill 90,000 Americans before the end of the year. The panel's findings were later downplayed. The real concern for the economy will be absenteeism. The Sydney Morning Herald has an interesting article called "Swine flu looms over global economic recovery."
Faced with the unpredictable nature of flu viruses, economists say it is difficult to assess the impact of swine flu on the delicate global economic recovery taking shape amid the worst world recession since World War II.
"As the severity of A(H1N1) is so far not severe, we would not expect the magnitude of the shock to the economy to be large relative to GDP (gross domestic product)," said Simonetta Nardin, a spokeswoman at the International Monetary Fund.
"The main threat to financial stability is the risk that high levels of absenteeism could lead to breakdowns in the functioning of key financial systems," she told AFP.
If a lot of people are out from work at all at once across the country (and even the world) it will be extremely difficult for much to get done. It is hard to schedule meetings and keep appointments when people keep getting sick. Illness can also keep people from shopping, eating out at restaurants and spending money.
The stock market turned a solid performance after months of news lows and uncertainy. It wasn't double digit growth but the main indexes Dow, Nasdaq and S&P each climbed greater than 7% during July.
Dow +8.4%
Nasdaq +7.8%
S&P 500 +7.4%
The Wall Street Journalreports that July, 2009 was the best monthly performance for the Dow since October, 2002. Overall the Dow is still over 35% below its peak but at least investors have some renewed confidence seeing the Dow back above 9,000. For the rally to continue we are going to need some good earnings reports and a lack of scary economic figures that cause stocks to trend southward again.
Bernie Madoff received a sentence of 150 years. Experts had been predicting that the orchestrator of an enormous Ponzi scheme would get only 30 years. Many famous people were caught up in Madoff's fake financial web. ITN reports that cheers broke out in the court room when the sentence was announced.
The U.S. Supreme court has delayed the sale of Chrysler to Fiat. The Supreme Court wants more time to consider opposition to the sale by three Indiana state pension and construction funds. Bloomberg reports the Fiat's CEO Sergio Marchionne says they won't walk away from the deal despite a June 15 deadline.
Moments after her order was issued, Fiat Chief Executive Officer Sergio Marchionne said in a telephone interview that the company will "never" walk away from the deal. The company previously set a June 15 deadline for completion.
A federal appeals court in New York last week allowed the sale, while putting its decision on hold until 4 p.m. today to let opponents including Indiana pension funds seek Supreme Court intervention.
Ginsburg's one-sentence order today said the bankruptcy court orders allowing the sale "are stayed pending further order" of the Supreme Court. That language leaves open the possibility that the justices might clear the deal to go forward in the next several days.
Bloomberg's article says the Obama administration has downplayed concerns that the deal won't go through. A top Obama administration lawyer has also urged the Supreme Court to allow Chrysler's bankruptcy to proceed.
GM and Citigroup Removed From Dow Jones Industrial Average
Bloomberg reports that General Motors Corp. and Citigroup Inc. have been removed from the Dow Jones Industrial Average and replaced by Cisco Systems Inc. and Travelers Cos.
GM, which filed for bankruptcy protection today, and Citigroup, the recipient of $45 billion in taxpayer aid, became the first companies since American International Group Inc. in September to leave the 30-stock average. Their shares have lost more than 90 percent since the start of 2007.
By replacing GM with Cisco, Dow Jones & Co. has removed automakers from the best-known benchmark for U.S. stocks, saying in an e-mailed statement that computers are as central to the economy as cars were in the previous century. Citigroup, until last year the world’s biggest financial firm by assets, is being replaced by a company it jettisoned in 2002 and that was once run by its former chairman, Sanford "Sandy" Weill.
"This announcement brings front and center the challenges facing the U.S. economy as it strives to remain competitive," said Alan Gayle, director of asset allocation at Ridgeworth Investments, which manages $60 billion in Richmond, Virginia. "The Dow Jones Industrial Average is becoming less of an industrial average. It's trying to reflect the broader economy."
GM's shares recently fell below the 75 cent mark and Citigroup has traded below $5 a share since mid-January.
OPEC has decided not to change its production output during its meeting earlier this week. It wasn't a surprise to oil analysts. OPEC cut production last fall. Oil prices have been rising lately as the world hopes for an economic recovery. A UPI story says there is concern an oil price push could threaten a world recovery. However, it still remains to be seen if the economy really is recovering - job losses continue to be very high.
The Federal Reserve said today that the pace of the economic attraction is slowing. The Federal Reserve says that interest rates will remain exceptionally low to ensure recovery. The Fed said this despite the fact that the GDP fell 6.1% in the first quarter. The outbreak of swine flu is a new wild card that makes the economic future somewhat unpredictable. There's also no sign that jobs or housing prices are starting to recover. These facts make the Fed's optimism seem premature.
CBS News 
There is concern going forward but the third quarter was very bullish for stocks. The Dow, S&P 500 and Nasdaq each gained over 15% in the third quarter alone. Reuters 
The U.S. Supreme court has delayed the sale of Chrysler to Fiat. The Supreme Court wants 
Bloomberg 