Friday, July 06, 2007

S&P futures vs fair value: -2.3. Nasdaq futures vs fair value: -2.5.

Early sentiment continues to deteriorate, signaling an even lower start for the cash market, as stocks take a bearish cue from the sharp pullback in Treasuries. With higher interest rates acting as such a huge headwind for equities last month, the yield on the 10-year note (5.18%) climbing to within a few basis points of the fed funds rate (5.25%) is stirring up borrowing concerns while Microsoft (MSFT) saying it will spend more than $1.0 bln to fix problems with the Xbox 360 is also acting as an overhanging factor.

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