Friday, July 06, 2007


The major indices all finished higher though the volume was once again very light. Gold, mining and construction were the big winners today while paper and the brewers were the losing sectors. RZ TCN POL AMCC VIMC ETC were the biggest gainers while MTEX PMTC BHIP were the biggest losers among individual issues. With regards to the porfolio, I had huge gains in BIDU UXG PRAI HANS NYX LVS MU and SNDK . BIDU has been on fire along with names like RIMM GOOG AAPL TNH CROX FSLR and its starting to take the feel of a market top with parabolic moves.

The job situation in June was essentially as expected, but Wall Street was taken completely by surprise by a stunning upward revision to the numbers for the prior two months.

Nonfarm employers added 132,000 workers last month, while about 125,000 had been forecast, and the unemployment rate was unchanged at 4.5%, the Labor Department said Friday.

However, the big news came in the change for April and May, when, combined, 75,000 more jobs were created than the government first reported. The Street

Crude oil rose to a 10-month high on concern unrest in Nigeria and maintenance of a North Sea oil field will curb supply as unexpected refinery closures cut fuel output.

The main militant group in Nigeria's oil-producing Niger River delta region condemned the kidnapping of a 3-year-old British girl. Brent oil, produced in the North Sea, is also rising because of planned maintenance at a field in the region. Refineries in California, Texas and Kansas have shut or slowed operations this week. Bloomberg

Zurich-based financial giant UBS (UBS) has a disconcerting habit of dispensing with senior managers without warning. Luqman Arnold was shoved out as chief executive officer in December, 2001, and replaced by Peter Wuffli in circumstances shrouded with mystery. Now, Wuffli has lost out in a boardroom coup.

In the early hours of July 6, UBS surprised just about everyone by announcing that the group chief executive would "relinquish all of his functions at UBS and leave the bank." Wuffli will be replaced by Marcel Rohner, the deputy CEO and chief of UBS's most valuable business, private banking (or Global Wealth Management, as it is officially known). Business Week

Some interesting action in Hilton Hotels calls pre the announcement ... Value Discipline

Friday's COTs report - based on the previous Tuesday's data - has really moved into strange territory for the equity indexes - a true jumble of bullish and bearish signals. The "dumb money" small traders have struck a historically extreme net long position in S&P 500 futures and options. This gave me a new bearish signal on Friday. COTs Timer

U.S. stocks closed higher Tuesday and extended Monday’s rally as investors focused less on declines in pending home sales and factory orders and more on a healthy flow of merger news.

Real Estate was the only sector down for the day. Leadership for the shortened session was provided by Energy along with Technology, Financials and Industrials. All of those sectors were mentioned as areas of alpha generation in Monday’s commentary, with the exception of Financials, which in our opinion remains suspect until the issue of sub-prime lending works it way thoroughly through the system. Portable Alpha

What is a hedge fund? Forward-looking due diligence on whether the strategy is likely to produce absolute returns in difficult times is surely the acid test. The sub-prime meltdown has revealed several leveraged beta bundlers but the market dependence was obvious AHEAD of time. Anyone with genuine skills and experience knows illiquidity can be expensive during market turbulence. It was clear since inception that Bear Stearns' two troubled credit investment products were never hedge funds. Hedge Fund

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