Defense is the Best Offense
April 15th, 2009 by Lawrence Grasso
Closing Data
| current | change | % | |
|---|---|---|---|
| Dow Jones | 7920.18 | -137.63 | -1.7% |
| NASDAQ | 1625.72 | -27.59 | -1.7% |
| S P 500 | 841.5 | -17.23 | -2.0% |
| FTSE 100 | 3988.99 | 5.28 | 0.1% |
| Nikkei 225 | 8842.68 | -81.75 | -0.9% |
| SPI Futures | 3730 | -34 | -0.9% |
| All Ords | 3,698.00 | 80.4 | 2.2% |
| Oil | 49.51 | -0.71 | -1.4% |
| Gold | 892 | -3.8 | -0.4% |
| Silver | 12.765 | -0.003 | -0.0% |
| Aluminium | 1472 | 21 | 1.4% |
| Copper | 4582 | 117 | 2.6% |
| Lead | 1425 | 72.5 | 5.4% |
| Nickel | 11405 | 650 | 6.0% |
| Tin | 11100 | 45 | 0.4% |
| Zinc | 1401.5 | 49.5 | 3.7% |
The Dow Jones Industrial Average declined 137.63 points, or 1.71%, to 7920.18,
bringing its losses to 2% on the week. U.S. stocks fell as financial
companies including Goldman Sachs Group and American Express gave back some of their recent gains. Government officials emphasized the fragility of the U.S. economy and the Commerce Department reported a decline in March retail sales.
Australian shares are expected to fall on Wednesday following the slide on Wall Street and fears the economic slump was far from abating. Financial shares could come under pressure after a $5 billion share issue from Goldman Sachs saw a sell-off in bank stocks on Wall Street.
If you are holding any of the banks in your portfolio, today would be a great day to sell calls or take profit on your holdings. Over the next couple of weeks we should see significant profit taking in this sector.
From a technical perspective the Australian market has been making gains on rather soft numbers and we feel that the XJO will find itself a little exhausted around the 3800-3900 level. Look for the XJO to fill a gap around 3892 on a daily chart over the next couple of weeks and then pull back.
Recommendation
Look to add defensive stocks (CSL,WOW,TLS) to the portfolio over the short term, as they tend to do well when the market is looking to retreat.
Contact your Freeman Fox Stockbroker on 07 3031 9960 or 1800 003 369 Ext 7.
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