1. McDonald's Corp. (NYSE:MCD - News) shares tumbled 6.66 percent or $1.21 to $16.95 on news that one cow in Alberta, Canada, tested positive recently for mad cow disease. The stock was the Dow's biggest percentage loser. Tyson Foods Inc. (NYSE:TSN - News), the largest U.S. beef processor, sank 4.86 percent, or 46 cents, to $9.01.
Mad cow disease, also known as bovine spongiform encephalopathy, has killed more than 100 people in Europe. It was the first confirmed case of the disease in a cow raised in Canada. The United States, which has never reported a case of mad cow disease, issued a temporary ban on beef imports from Canada because of the case.
2. Earlier, the U.S. government raised its color-coded terror alert status to "orange," the second-highest level, from "yellow" or "elevated" due to the risk of attacks in the United States. The decision followed a Federal Bureau of Investigation warning that an attack on U.S. soil is possible, though it said it had no specific threat information.
3. Late Tuesday afternoon, police halted some train traffic from New York's Pennsylvania Station as they checked a suspicious package, which turned out to be of no concern, a transit police spokesman said.
"You had the terror alert earlier and some people sold on that, but then cooler heads prevailed," said Bob Basel, senior trader at Smith Barney. "You also had a situation at Penn Station which exacerbated the fears, but that's been taken care of." ---------------
If 3 events today can't send this market lower, then what does that tell you? 2 things: (1) this selloff is not upsetting the current uptrend at all, and is drying up. It is just a routine profit-taking. Wall Street says this to the sideline money: "A lot of people said 'we are gonna see some correction', okay, okay, fine... So now you got one, a healthy pullback. So, what else do you have to see in order to jump in, hmm?" (2) The buying is ready to come back. Germany and some other European countries are in recession, and so the strength in Euro is not sustainable. ECB will cut their interest rate later. As a result, many bond traders, money managers and myself expect a capital inflow back to the US later in the summer.
This stock market simply refuses to go any much lower. To the shorts: please do not cover now; rather, please short this POS more and cover later, to send BRCM over $25. Thanx....