Market View: Broad based pressure and new lows for the week -Update-

Sunday, December 16, 2007

The stock market opened on a negative note amid news that C was going to incorporate $49 bln of SIVs onto its balance sheet and another round of higher than expected inflation data (CPI +0.8% consensus +0.6%). The S&P 500 and Dow stabilized near initial supports at 1476 and 13400 and benefited from some early strength in Broker, Airline and Healthcare but this was insufficient to lift the indices above yesterday's highs amid relatively broad based sector pressure. A slow but steady slide off the morning bounce highs saw all of the market averages except the Dow drop to new lows for the week in late trade. The weakest performing groups were led by Trucking -2.8%, Paper -2.8%, REITs -2.4%, Retail -2.3%, Oil Service HOLDRs -2.3%, Internet HOLDRs -2.2%, Insurance -2.2%, Bank -2.1%, Disk Drive -2.1%, Rail -1.9%.