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Jun 4, 2007 - Issue #061

Boring!

DJ-30: 13668.11 +160.83 +1.19%. In the Real World: 56.06 +0.66 +1.19%.

UP: 25, Down: 5.

Trends (weekly): This is the subjective part.

Rising 19 (-2) 63%:

AA, AXP, BA, CAT, +*DD, DIS, GE, HON, HPQ, IBM, JPM, KO, MMM, MO, MSFT, PFE, UTX, VZ, XOM.

Consolidating 9 (+2) 30%:

AIG, C, GM, HD, -*INTC, -*MCD, -*MRK, T, WMT.

Declining 2 (n/c) 7%:

JNJ, PG.

+/- denotes change of direction.

* denotes change of category.

Boring!

The averages might be putting you to sleep, but don't be lulled into a false sense of security.

Here's a clue: Sudden sharp moves among individual components that are not being reflected in the overall averages.

Here's another clue: The NYSE is consolidating the trading floor space, due to the large numbers of NYSE specialists leaving the floor. The NYSE is looking more like the NASDAQ everyday. Let's hope the liquidity will remain high. Specialists may have been replaced by off-floor market makers. In other words, the NYSE floor may be morphing into a dealer market.

As long as they have access to derivatives such as options and single stock futures with which to hedge their positions, liquid markets should continue.

The good news is: Those same derivative tools are available to all market participants. Computers and the internet have empowered the individual more than at any time in history.

Don't expect the low volatility to continue for much longer.