Updated late Tuesday and Friday nights
Tuesday’s Close for May 5th, 2009
Written by: Mike Coval

So after all these gains when will the pullback or profit taking occur? We are undoubtedly in an uptrend so taking any new bearish trades may not be the correct trade but taking any bullish trades at these overbought levels is just as risky.

To watch a video of Tuesday’s market action, along with my thoughts, Click here. The DOW closed down 16 points at 8,410 while the NASDAQ closed lower by 9 to finish the day at 1,754.

Energy: Oil prices were only slightly lower. Late in the day, the price of crude futures was trading down $0.66 at $53.81 a barrel. Track the price of crude with the Oil ETF, USO.

A little hard work and practice and you can accomplish just about anything.

The good news is that the selling did not follow Yesterdays gains, the bad news, we did not follow through with any buying.

Economic News: On Capitol Hill, Federal Reserve Chairman Ben Bernanke told the Joint Economic Committee of Congress that job losses would probably escalate. But in his most optimistic view of the economy he said it could start growing again by the end of 2009.　

"Recent data suggest that the pace of contraction may be slowing," he said in prepared testimony, "and they include some tentative signs that final demand, especially demand by households, may be stabilizing."

Bernanke predicted the economy should shift back to expansion by the end of the year.

In other economic news, the Institute for Supply Management's index for the services sector suggested the industry was still contracting but by less than economists had expected.

Transportation: Finally some good news for the airline stocks. AMR shares rose 10%. April traffic at its American Airlines unit fell 4.7% to 10.28 billion revenue passenger miles from 10.79 billion in the year-ago period. Capacity slid 6.1% to 12.64 billion available seat miles, while load factor, or the percentage of available seats filled with passengers, edged up to 81.3% last month from 80.2% in April 2008.

Financials: In finance, the government's stress tests revealed that about 10 out of the 19 banks examined should boost their capital reserves to be adequately prepared for another downturn. The Financial Sector SPDR XLF closed down $0.17 on the news.

UBS fell $0.32 after posting a $1.75 billion first-quarter loss, in line with its guidance from last month. UBS also said it expected the weakened economy to force the firm to expand its credit provisions.

Technology: Apple, AAPL up $0.64 and Google, GOOG, up $1.01 are the subject of federal investigation regarding whether the composition of their boards constitutes an antitrust violation. Google Chief Executive Eric Schmidt and former Genentech CEO Arthur Levinson each sit on both boards, which has become increasingly of concern to the FTC as the firms have become larger rivals in the telecom and operating systems markets.

Healthcare: The heart started to beat over at Health Net, HNT. The share price gained 12%. The managed health-care company said it swung to a first-quarter profit as tighter cost controls more than made up for an overall decline in total health-plan enrollment.

Good and or bad stocks to watch: EBAY, JOSB, CTRN, HXL, APOG

Homework: None Today

Cheers,
Mike