2.25 PM Comments from the Fed killed the rally, and the DJIA dropped into negative territory. The central bank will keep interest rates low through mid-2013, but it did not indicate any intervention which might have been called QE3

2.21 PM In the midst of the chaos of the market Apple (NASDAQ: AAPL) passed Exxon Mobil (NASDAQ: XOM) as the most valuable company traded on any US exchange. It’s market cap–$339 billion

2.13 PM Stocks have trimmed half of their gains before the Fed comments. The DJIA is now only up .85%

12.37 Market flattens ahead of Bernanke comments. Traders appear to be avoiding the risk of a sharp move when the Fed makes its comments on the economy and any remedies it might offer to a slowing economy. These comments are due at 2.15. The Nasdaq is steady up 3.7% to 2,444. The DJIA holds its own at 11,400 up 2.1%

12.04 PM Europe exchanges closed higher except in Germany which reported a drop in exports for July. The FTSE rose 1.9% but the Dax ended down .1%. Banks, the victims of the collapse in EU market yesterday, helped mold the recovery

11.58 AM Pressure on oil price rise today should ease. OPEC said it cut if forecast for the balance of 2011 by 150,000 barrels a day. Cartel expects lax demand in US and China

11.47 AM Breaking Bloomberg data shows majority of economists believe that Fed will ease monetary policy this years. If bank stocks continue to fall, central bank may have to option to help money center banks to raise capital

11.45 AM The Dow has backed down modestly and is now less than 200 points higher–1.6%. The Nasdaq has not clawed back most of its horrible losses from yesterday, but is up 3%. Oracle (NASDAQ: ORCL) is the prime drive of the tech recovery.

11.25 AM Vix “fear index” (The CBOE Market Volatility Index) is down to 41.73 from near-record 48 yesterday, extraordinarily high. The Vix is not low enough for investors to believe the roller coaster is not over

10.59 Oddly, oil and gold are each higher, crude up .7% to $81.83, and gold up 1.9% to $1,734, near a record. Move to gold is a sign that the markets are still rattled enough to keep cash out of equities. Oil rally continues after massive sell off

10.37 AM The market has rallied 2% on the DJIA and 3% on Nasdaq. Perversely, safe haven stocks are not rising as money moves back into risk. Altria (NYSE: MO), Cisco (NASDAQ: CSCO), and Cablevision (NASDAQ: CVC) have shown no movement

10.05 AM   Famous bank analyst rates Bank of America a buy, a strange call for a researcher who has disliked the bank. Shares rallied 8%.

9.40 AM The market did not soar up as expected. The DJIA is only up .7% and the Nasdaq up 1%. Part of the reason is a sell off of safe haven stocks like Altria (NYSE: MO) and Cisco (NASDAQ: CSCO)

9.23 AM Gallup showed a sharp drop: Americans’ economic confidence plunged to -53 in the week ending Aug. 7, down sharply from -43 two weeks ago and -34 a month ago to a level not seen since the recession days of March 2009. Seventy-seven percent say the economy is “getting worse” and 55% rate it “poor.”

8.40 AM In the latest sign that markets are in a broad recovery, oil moved above $80. Several economists believe oil is oversold and that demand will remain strong. Also, productivity declines in the second quarter by .3%. This may be an indication companies will need to hire. The market had little reaction to the news

8.15 AM The odds of a solid open grew as non-bank shares indicated higher. Sprint-Nextel (NYSE: S) was higher by 4.5% in the pre-market and US Steel (NYSE: X) was higher by over 3%.

8.04 AM In an early sign that Wall St. may view bank shares as oversold, FBR ungraded Well Fargo (NYSE: WFC) to “buy”

7.44 AM Bank shares, the major victims of the sell-off are up in pre-market. Bank of America (NYSE BAC) higher by 4%. JP Morgan (NYSE: JPM) up 2%

7.42 AM Europe got healthy as indexes moved to up slightly. US currently indicated to open up 100 as market waits for Bernanke.

7.08 AM Shares in Europe have begun to recover and the FTSE is now down only 1%. The Dax is off over 3% as German exports softened in June

6.53 AM Blackrock (NYSE: BLK) management said it will use profits from it gold and fixed income portfolios to buy equities, according to Reuters.

6.23 AM The market’s attention turned toward Bernanke and whether he will announce something called “QE3” later today as a means to steady the market. European markets steadied but US futures continued to ride wildly up and down.

5.56 AM Oil has plunged to $79 on concerns about a worldwide recession. The price was close to $100 just a month ago. The precipitous drop has pressured energy shares with Royal Dutch Shell (NYSE: RDS.A, RDS.B) and BP (NYSE: BP) off sharply.

5.24 AM There was some hope that Europe markets would be a firewall against the global sell-off as they opened down only slightly. That has not continued. Indices in German, France, and the UK are down an average of 4% as concerns about a dying global economy rise.

4.03 AM Stocks in Europe quickly sold down so that the FTSE and Dax are off over 2%. US future gave up almost all gains

3.23 Asia trades off lows with the Hang Seng down 2.9% and improvement from a 6% drop at the open. Most Europe exchanges open flat to slightly down. US futures rally sharply with Dow futures higher by 300 points.

3.25 China inflation surges with CPI up 6.5% for July. The central bank may tighten which would tend to slow the economy

Douglas A. McIntyre

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