July 28, 2010, 4:00 pm EDT .. Closing Thoughts — The Standard and Poor’s 500 index closed down 7.71 to 1106.13, as close interim resistance of 1,117.51 didn’t happen to compromise technicals. Meanwhile, volume was weak even by summer standards, which has added to the day-to-day volatility. … The Federal Reserve said the economic recovery is slowing in some parts of the country. In its regional survey of the economy known as the “beige book,” the Fed said economic growth has been steady during the summer in Cleveland and Kansas City, but has slowed in Atlanta and Chicago. The central bank described economic activity elsewhere as modest. The Fed report had some sobering news about manufacturing, which had been one of the strongest parts of the economy. While manufacturing expanded in most of the Fed’s 12 regions, about half — New York, Cleveland, Kansas City, Chicago, Atlanta and Richmond — said manufacturing had “slowed” or “leveled off.” …The Fed assessment followed a disappointing Commerce Department durable goods orders report early in the day. Orders for durable goods, which are expected to last at least three years, fell 1 percent in June. Economists expected a 1 percent gain. … Under reported: The Labor Department said Wednesday that the unemployment rate rose in 291 of 374 areas in June from May. It fell in 55 areas and was flat in 28. That reverses the trend of the previous three months, when joblessness fell in most metro areas. The economic recovery has spurred some hiring, with private employers adding an average of 100,000 jobs each month this year. But the pace of hiring slowed in May and June and isn’t nearly fast enough to bring down the unemployment rate. Earlier this month, the government said the nation’s unemployment rate fell to a seasonally adjusted 9.5 percent in June from 9.7 percent in May. But before adjusting for seasonal factors, the rate actually rose to 9.6 percent from 9.3 percent. … Most of the cities with the largest increases in unemployment last month are college and university towns. Tuscaloosa, Ala., home to the University of Alabama, reported the second-largest jump in unemployment in the country, from 9 percent to 11.3 percent. … The unemployment rate in Ames, Iowa, home to the University of Iowa, rose to 5.8 percent from 4.8 percent, the sixth-largest rise. Grand Forks, N.D.; Fargo, N.D.; Champaign-Urbana, Ill.; Columbia, Mo.; and College Station-Bryan, Texas, all have major universities and all were among the areas with the 10 largest increases in unemployment. Among cities with more than 1 million residents, Las Vegas reported the highest jobless rate, at 14.5 percent. That was up from 14.1 percent in May. … The Washington metro area, bolstered by widespread federal government hiring, reported the lowest unemployment rate among large metro areas, with 6.4 percent. It was followed by Oklahoma City, Okla., which has benefited from the oil and gas industry, at 6.7 percent. … El Centro, Calif. and Yuma, Ariz. posted the highest unemployment rates in the country, 27.6 percent and 26.4 percent respectively. The two areas have large populations of seasonal agricultural workers. … Twelve areas recorded unemployment rates of 15 percent or higher, the government said, with 10 of them in California. … A poor jobs market, evaporated wealth from decimated home and stock values, hard-to-get credit and wages that aren’t supposed to advance sharply anytime soon mean consumers are still facing considerable headwinds. How consumers behave is crucial to the recovery because their spending accounts for roughly 70 percent of all economic activity. Not the time to buy the noise that “all is well in Stockville.”

July 28, 2010, 7:00 am EDT .. The Standard and Poor’s 500 index futures down 0.40 to 1110.50, as the governor of the Bank of England said Wednesday that the need to stimulate the economy still takes precedence over concerns about high inflation at a time when the outlook for the global economy remains uncertain. Governor Mervyn King told Parliament’s Treasury Committee, “We continue to face the challenge of rebalancing our economy away from consumption towards net exports, and raising our national savings rate. During the rebalancing, there is a risk that the level of money spending in the U. K. will remain weak, with the economy operating below capacity. That would push down on inflation potentially to a rate that is significantly below the 2 percent target. … The key underlying causes of the crisis in terms of the imbalances in global demand have still not been tackled. Those imbalances are likely to be larger this year than last, and will probably still be around three-quarters of their level at the peak immediately prior to the crisis.” … Meanwhile, The yen was down against the dollar, and the euro was up. Oil prices were above $77 a barrel after a report showed U.S. oil supplies unexpectedly rose last week, suggesting demand remains subdued. Britain’s FTSE index of 100 leading shares was up 0.3 percent to 5,365.67, Germany’s DAX was slightly higher at 6,209.26 and the CAC-40 in Paris added 0.4 percent to 3,680.01. … China’s central bank also said it believes the mainland’s economy is unlikely to suffer a “double dip,” or relapse into a slowdown, helping Chinese shares to rebound to a 12-week high, led by banks and real estate. The benchmark Shanghai Composite Index jumped 58.3 points, or 2.3 percent, to close at 2,633.66, the highest since May 14. Japan’s benchmark Nikkei 225 stock average outpaced China, with a 2.7 percent jump to 9,753.27 after laser printer and digital camera marker Canon reported a surge in quarterly earnings. Sharp increases in Japanese automakers’ global production for the first half of the year, underlined a recovery in demand for new cars. Exporters were also helped by a softer yen, which boosts the value of their repatriated profits and makes their goods more competitively priced abroad. The Japanese currency approached 88 yen to the dollar — up from earlier this month, when the dollar sank to the mid-86 yen range. The improvement in sentiment caused broad-based buying. … In currencies, the dollar rose slightly to 88.04 yen from 87.76 yen late Tuesday in New York. The euro rose to $1.2996 from $1.2988. Benchmark crude for September delivery was down 9 cents at $77.41 a barrel in electronic trading on the New York Mercantile Exchange. … The current spin  across the board: Two weeks ago, people were wondering whether the U.S. was slipping back into a double dip. In fact, corporate results are very good. The market is starting to get the message that the economy is not so bad. Okay — buy the noise at your peril, but play the equities market like its true. Follow yesterday’s script — Major test today for S&P 500 index at interim resistance of 1,117.51, last held on June 18, 2010. With low volume and exaggerated swings, stocks are being driven by earnings plays. Trade the tape and remain flexible. Take profits and don’t allow the enthusiasm to buy paper cloud your mid-term view.