The market seems to be selling-off on the back of limited bad news imo, apart from the dollar that is.

If you can hold your nerve and apart from any short term requirements to offload poor performing stocks, I have a couple!!, my advice would be sit tight. This does not have the feel of the tech(mining!) bubble at all. Difference being there are a lot of good fundamentals, unlike in 2000 when there were a lot of over rated nothing companies.

Is the market putting a little pressure on the BOE in front of tomorrows interest decision?

just nerves and a bit of profit taking after a decent recovery over the last few days ..... have gone long Dow at 13296, but pretty gently

I posted on another thread about 5 weeks ago a possible "head and shoulders" pattern on the FTSE. Although the right shoulder didn't form definitively the FTSE is still struggling to break through the "theoretical" kneck line. In so much as all this technical stuff is a load of old hooey anyway, I think a retest of the 5850 levels is possible. Where it goes from there (if it goes there) is anybodys guess. If you look back at the recent corrections they've all formed a "W" shape (or double bottom). The current "correction" is in the first "V" of a W.

In my opinion....and observation.

Strawbs.

Home sales in USA is worse than expected...brace for another downturn tomorrow.

And the Feds has not indicated any further drop in interest rates...very bad news. The subprime concern could be much worse than what it is now. House sales and rise have also slowed down considerably in UK. Certainly hope the FTSE will not dive tomorrow but I think it will. Good luck.

And BoE's interest rate is not going down today...this will plunge the FTSE today.

i don't think anyone expects the rates to be dropped ..... the interest is in whether or not there will be any accompanying statement and what that may say or indicate

The subprime fears has re-emerged that there was a 12.5% monthly decline in contract signings on existing homes, the largest drop in six years in the US. Dow will drop today imo.

hlyeo98 how is your FTSE short? Dow moving the wrong way for you at the moment.

Well, my post #1167 about thursday being a day of buttock clenching volatility turned out to be a white elephant. Just goes to show that the brokers get it wrong sometimes!

They have their agenda which as you know is often the opposite to what they say.

Interesting e-mail just landed on my desk.
The major brand of Lehman brothers for the UK sub-prime lending market is withdrawing from the second charge market as of next month.
They claim it is to consolidate other brands (ie lose them) and concentrate on first charge lending, but this may be their reaction to forecasts of lower house prices.
In a lowering house price environment, sub prime second charges are almost worthless and by getting out of that arena they may protect the rating they have on first charges.
As I say, interesting, but you can read it as you wish. Just my interpretation.
Alan

What a load of tosh Lehman is not a building society didnt you know?

No but they do own, outright, 3 of the largest subprime lenders in the UK (SPML,LMC & Preferred) plus they supply the subprime lending arm of Northern Rock. Or didn't you know?
Please get your facts absolutely right before trying to rubbish me.
Next.

If that is correct tell me what the total exposure is in relation to Lehman's NAV.

I have no idea of their exposure but the facts are as stated.
The brand being pulled is LMC (the smallest and most sub prime of the 3) and the 2nd charge outfit that is being pulled is SPPL.
My source is the company themselves, and the exposure to the 2nd charges will be between 6 and 12 months gross second charge lending throughout the UK, as they usually do not sell their "book" on until they have 6 to 12 months payment record.
The danger is that if delinquincy rises, the book becomes worth less, reducing profit and the lowering of the profit and increased risk from non recoverable debts lowers their own rating, making their borrowing across the group, more expensive and their first charges either less attractive or less profitable. They need to avoid this.
Alan

You like many people are unable to answer the question sub prime lending is just a small part of a banks lending activities. It is rather like saying if all Barclaycard users failed to pay Barclays would go out of business. I think at last the markets are beginning to realise that this sub prime scare is just another way for dealers to make a buck during the lazy days of summer. Keep trying to scare people!!

No axe to grind here. Check the threads. I have always been very bullish on both property and the markets in general.
Ask cynic!!! ;-)
I even debated the difference with him between US sub prime and UK sub prime.
The point is though very valid. The parts Lehman Bros have decided to shed are the very riskiest areas of their lending portfolio (and therefore the most profitable). LMC are a veritable last chance saloon for borrowers and 2nd charges are notoriously wobbly in static or falling property markets.
It is not the few hundred million they are exposed to in these markets that is the issue, it is the loss of confidence among their backers and the fickle ratings of S&P etc. that make them a little more cautious. A loss of confidence or rating would cost the entire business much more than this in higher borrowing costs and lower margins, as many previous lenders will testify.
On the remaining 2 brands, margins over LIBOR have increased and underwriting has been toughened up which is probably an even greater signal of Lehmans reading of the near future.
Perhaps because I live in Yorkshire, I see no great crash or stampedes to the bankruptcy courts yet, but other areas of the country may be more volatile.

Yorkshire property market, especially the upper echelons is indeed still very strong ...... however, elsewhere it seems to be stalling, which is actually no bad thinbg

Glad to hear that, cynic, as my home for is up for sale and is in Yorkshire and is (I think) in the upper echelons for the area.
Good news all round. I might actually flog the damn thing.
Alan