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RealTime IT News

The Week That Was

Stocks might not have moved very much this week, but the news that occurred could be felt by investors for a long time.

It could go down as the week that the Fed's rate hike campaign was brought to a screeching halt and investors lost some of their hard-won protections of the last few years.

After Friday's jobs report showed that the economy added only 78,000 jobs in May — about 100,000 less than expected and half what is needed to sustain the recovery — the phrase "one and done" began to make the rounds: one more Fed rate hike at the end of the month and then back to neutral. With the ISM manufacturing report skidding to 51.4 this week — the Fed has never raised interest rates with the ISM below 50 — it's beginning to look like a good bet that the Fed will soon be done. Without signs of inflation, there's no justification for the Fed pushing manufacturing into a contraction.

It may also go down as the week that the post-Enron corporate reforms began to erode, with the Supreme Court overturning the Arthur Andersen conviction for shredding Enron documents, the jury deadlocked in the trial of HealthSouth's Richard Scrushy, and the ill-advised nomination of Rep. Christopher Cox to replace William Donaldson as SEC chairman. As a sitting politician with a long history of opposing investors' interests on accounting and securities litigation issues, companies that have complained about tough new laws and regulations may soon have a sympathetic ear at the SEC.

Mark the week on your calendar, folks. It could go down as one to remember.

Stocks fell sharply Friday on rising oil prices and the weak May jobs report.

The Nasdaq lost 26 to 2071, the S&P fell 8 to 1196, and the Dow dropped 92 to 10,460. Volume declined to 1.62 billion shares on the NYSE, and 1.68 billion on the Nasdaq. Decliners led 18-14 on the NYSE, and 19-11 on the Nasdaq. Downside volume was 65% on the NYSE, and 77% on the Nasdaq. New highs-new lows were 198-24 on the NYSE, and 83-28 on the Nasdaq.

Apple lost 4.5% on inventory concerns and a class-action settlement.

Blue Coat Systems soared 25% on its results.

Amdocs rose 3% on a Raymond James upgrade.

Cognos lost 7.6% on a warning.