Pre-market outlook Jan. 15th 2009: Market Indexes will drop again today

Lots of news this morning and I will try to state major items of interest affecting your portfolio. The net effect of the news is that today will be another down day for U.S. markets. Here's the summary:

- Jamie Dimon of JP Morgan says worst is yet to come in the financial crisis
- Microsoft is seriously considering layoffs
- Motorola is looking at more cost cuts in 2009 including cutting 4,000 jobs
- The Eu Central Bank has lowered interest rates 50 basis points to a rate of 2%
- Russia has devalued its currency for the 4th time in 5 days.
- Nissan to reduce US Mfg. Plants to a 4 day work week

You can do a search on any of these items today and get the detailed news story.

I looked for some good news today but couldn't find any. The effect on the stock market futures is predictable with Dow Futures dropping over the past hour and the Nasdaq Futures were hit by the Apple news as well as the fact that Microsoft considering layoffs.

I would still hold on to the ETF Ultra Shorts SDS and TZA but by tomorrow the market may be down enough that selling some of your shares from your positions could be warranted. Currently SDS is at $81.30 in pre-market and TZA is currently at $61.49. I am still thinking these shares will rise substantially. If they don't rise enough by tomorrow I will still hold all shares. The reasoning there is that on the day of Barack Obama's Inauguration the markets may rise from the optimism of a new President and it may linger some days next week. However when reality sets in we are headed down to retest the lows and that is where you will want to sell these two ETF's.

Depending on the severity of the drop in Apple stock, symbol AAPL, I may add to my position again in the coming days.

Apple UPDATE re Steve Jobs

Steve Jobs, Apple CEO announced after the close that he is taking a medical leave till June, while dealing with the hormone imbalance issue he cited in earlier press releases, during the Mac World Conference. He said it turns out that it was more complicated a problem than earlier reported and he will use the time to deal with it, but will stay involved in Apple on strategic issues for the next 5 months.

Sorry I didn't see this coming and had recommended the stock at $85-$86/share. In after hours the stock has slumped on the news to $79. I still believe the company is a good investment but we need to digest the news and the timing of the current market drop. Sorry on this one and hope you didn't jump in with both feet as I had advised only a 1/3 investment of the shares you were thinking of purchasing. I will watch the action over the next few days to see the fallout and let you know what I am doing with the stock. I may add more or I may sell. Can't say at this moment.

I know we all wish Steve Jobs the best and for a speedy recovery.

Market closing comments for the day Jan. 14th, 2009

The markets closed down today. The Dow closed down 249 to close at 8199 and the Nasdaq closed down to 1489. The ETF Ultra Shorts did well today. SDS closed at $80.30, up 6.7% and TZA closed at $60.24, up 13.1% and did not disappoint those who also own them.

Apple stock closed at $85.43, down 2.6% and I took advantage of the drop to add more shares at $85.42 today.

I see the markets continuing the decline tomorrow and Friday as well. The volume was light today so many may be awaiting other financial data updates the next 2 days. I can see the Dow going below 8,000 possibly this week.

Also earnings continue to be announced, as well as additional layoffs. Today, Pfizer announced about 800 research scientists being let go. Be a survivor, plan for the worst and feel good when it isn't as bad. Good luck.