For the past six months, the bulls have handled pretty much everything that has been thrown at them. Or more accurately, our heroes in horns have been able to effectively brush aside anything and everything that may have been considered even remotely negative. However, with $100 oil now being dumped on the bulls, the key question in my mind is whether this will be the issue that finally matters or just another item to be placed in the ‘handled’ category? (more…)
SUMMARY:
- It took a couple of tries, but the market manages to start a relief bounce.
- Qaddafi rumored shot, oil retreats, stocks recover.
- Jobless claims again below 400K, suggesting, dare anyone say it, a trend lower.
- January New Home Sales fall 12.6%
- Durable Goods Orders headline is in line but ex-transports it plunges and business investment tank
- Rebound indicates the selloff is not a massive one, but likely not over yet either.
(more…)
To anyone holding long positions in the stock market, yesterday’s batch of rumors and innuendo was likely seen as a savior. Prior to two market-moving rumors – one of which turned out to be true while the other, as expected, was pure fiction – stocks appeared to be in a world of hurt from a technical perspective and it looked the bears were making plans to stick around a while. However, unless reality catches up to the projections and oil prices stop climbing, the rumor-driven rebound may have just delayed the inevitable. (more…)
Something happened in stock market on Wednesday that hasn’t occurred since the scary days of last summer when the words ‘double dip’ and ‘European debt crisis’ were all the rage: a second straight triple-digit decline. Given that traders haven’t seen more than a handful of triple-digit drops in total since September 1st of last year, two consecutive days of meaningful losses may have left some people scratching their heads. Thus, the key question on the minds of the investors I talked to yesterday was, “What’s it all about?” (more…)
SUMMARY:
- Post-holiday blues: unrest spreads from individual stocks to the market.
- Market rally finally hits its tipping point, triggered by Libya threatening to pull its 1.8M bbl/day off the market.
- WMT earnings falling, Home Depot’s rising. That is as it should be in an economic recovery.
- December Case/Shiller remains in the dumps as the new home buyers stimulus is long gone from the rearview mirror.
- Consumer confidence is rising sharply, but for how long if oil prices, and thus gasoline, continue to surge?
- Oil, gold spike as fear trades renew their strength.
- Big downside session not likely the end of the selling as it was in late January.
(more…)
The last time the stock market had a bad was Friday, January 28th. If you will recall, that was the day traders decided to focus on the growing unrest in Egypt. Granted, it was an options expiration Friday and traders were looking to avoid any potential headline risk over the weekend. However, the Dow fell 167 points and suddenly everyone on the Street was bearish. (more…)
After what has likely been a painfully long stretch of one way road, it appears that our furry friends may have spotted the one road sign they’ve been aching to find on their journey: Two Way Traffic Ahead. As we’ve been saying for many moons now, the current one-way market is indeed rare. This type joyride to the upside has definitely happened before, but it has also clearly confounded anyone expecting to see a more traditional two-steps-forward-and-one-step-back type of bull market environment. (more…)
SUMMARY:
- A more ‘old fashioned’ expiration with a return of a modicum of volatility, but in the end the market rebounds yet again.
- Sellers show up a bit more on the week as the economic data hit a soft patch.
- Even with some headline headwinds, the market rises, showing the power of liquidity.
- Overall the indices hold the trend, remain in great shape, but more stocks are struggling as the market extends its move.
- Will the unrest in some of the market leaders spread similar to the unrest in world?
(more…)
SUMMARY:
- Economic data, unrest give sellers another shot, they take it, but again come up short.
- CPI hotter than expected. Not scorching, but on the rise finally, though not reflecting reality.
- Jobless claims bounce back up as the 385K now looks weather induced.
- Manufacturing continues as the bright spot as Philly manufacturing surges.
- Delinquencies fall though loans in foreclosure rise.
- A ‘good environment to do business’? A response to a spreading misconception.
- Stocks again find a bid after a dip, but the fact that sellers are even showing up is notable given the length of the run to this point. (more…)
One of the interesting things about attending a conference of fellow market geeks (which is not considered a detrimental term with this crowd!) is listening to the running commentary about the stock market action over the two days of meetings. To be clear, this is not a group of individual investors but rather a gathering of the National Association of Active Investment Managers, which requires its members to be registered investment advisors – I.E. investment professionals. And given that this is a group designed for “active managers” there is a fair amount of trading acumen in the room at all times. (more…)
February 17, 2011 Eric Aafedt
Trades
Our Success Trading Group likes Pepsi (Ticker: PEP) at $64 for a trade position today.
SUMMARY:
- Economic data throws out a clinker and the extended market takes a day off.
- February retail sales come up shy.
- Import prices jump, New York PMI falls a bit short of expectations.
- China inflation less than expected but posts its highest level in 6 years.
- Modest give back on indices keeps them well above the 10 day EMA, but many stocks find themselves quickly struggling.
(more…)
SUMMARY:
- Not impressive in itself, but the session sees the market working higher again with the smaller stocks leading.
- China exports help US stocks overcome spreading Middle East unrest
- Obama $3.7T budget ‘cuts’ spending by not spending money it had planned to spend.
- FDX reports after hours earnings miss, blaming storms, fuel costs. FDX using the built in excuses.
- Will FDX splashes cold water on the Monday move, but . . . can it be enough to derail the rally?
(more…)
Although the stock market did manage to grind its way to yet another green number on Monday, there really wasn’t a whole lot of activity. Sure, there were some sell programs and some buy programs run just to keep us on our toes. But for the most part, Monday was a day where one could ponder some bigger-picture issues. So, given that the winter winds pounded most of the country with snow recently and whipped up all kinds of trouble for all kinds of people, the question of the day for the financial markets is if the weather will become a headwind for profits (and the economy)? (more…)
Instead of a clichéd play on Valentine’s Day, this morning’s theme is based on the literary genius of Wayne’s World. In what could easily be seen as my warped little view of the stock market, I’m of the mind that the temporary focus on the happenings in Egypt can be equated to pulling the nets off the street to let the cars go by. But now that Hosni Mubarak has finally seen the light (and had his reported $70 billion cash hoard in Swiss banks frozen in the process), it would appear that it’s “game back on” for the stock market bulls.
(more…)
SUMMARY:
- This time Mubarak quits for real and the market does the same thing it did on the dry run: rally.
- Treasury proposes ‘winding down’ FRE, FNM . . . very slowly.
- Foreclosures down again.
- Michigan Sentiment continues to improve
- Market does the improbable again, i.e. extending its rally beyond most traders’ comfort level.
- Extended and moving into next resistance, but big and little names continue to jump higher.
(more…)
SUMMARY:
- Not even good jobless claims could rally stocks Thursday morning, at least until stocks decided to rally back yet again.
- EU cannot win: Portugal CDS jump, UK inflation surges.
- US bond sale has a hard time finding buyers.
- Failing to learn from history, part . . . 73? Throwing friends, even dubious ones, under the bus.
- Mubarak ‘resignation’ credited with stock market recovery. Will it sell Friday given he didn’t really leave?
(more…)
Anyone who has been around this game a while (which we will define today as since the tech bubble began) is likely familiar with Mr. John Chambers and that little networking company he’s been running. While Cisco (CSCO) is perhaps best known as being the backbone of the internet and probably responsible for that wireless network you’ve got running in your office or at home, from a financial perspective Cisco is known for beating its earnings estimates. (more…)
SUMMARY:
- Stocks ‘sell’, finishing lower as a late rally fell just short of more gains.
- Housing woes continue to show up in the late 2010 numbers as 1 in 4 homes are in ‘negative equity’ posture.
- Fiscal and monetary policy lead to a terribly bifurcated economy.
- CSCO earnings disappoint again. Will they trigger another November-style pullback?
(more…)
Recall that on Tuesday, with the markets stepping lively to new bull market highs, I had been asked the same question several times: What’s it gonna take to get a down day around here? While the venerable DJIA managed to pull a rabbit out of the hat and finish higher for an eighth straight session yesterday, the rest of the market indices finished in the red, albeit by varying degrees. So, what did it take for the bears to finally come away with a win? Well, it looks like it took a tanker, a lot of talk about inflation, some selling of the leaders and then looking ahead, perhaps a little company called Cisco. (more…)
SUMMARY:
- Market hangs around the flat line keeping itself in the game, and then the upside bias kicks in for a rally to the close.
- China hikes interest rates, fanning those fearing inflation is close at hand. Gold rallies, bonds flattened.
- Fed-speak starting to flow regarding changing interest rate policy.
- Market up 6 of 7 sessions on top of the existing rally. Time to lock in some gain in anticipation of at least a pullback.
(more…)
Well, it’s official. The angst in the bear camp has become palpable. While I prefer to be an agnostic when it comes to taking sides in the market, one of my colleagues who, unfortunately, has leaned toward the dark side over the last couple of months has gone into hiding, while another lamented to me yesterday, “When is it going to end?” And my personal favorite example of strife in the bears’ den was the one line email from Tuesday, which read, “What’s it gonna take to get a down day around here?” (more…)
SUMMARY:
- Friday it was NASDAQ, and now SP500 joins with its own new rally high.
- M&A activity keeps upside interest ginned up.
- Credit card spending increases for the first time in 27 months.
- Oil resumes its decline.
- All indices made the break and now look to hold it.
(more…)
Stocks moved to a fresh set of new highs for the current bull market cycle on Monday, leaving little doubt in the minds of investors that after a brief scare relating to Egypt, the trend continues to be up. And while the popular press continues to beat the drum about the moves to new 2.5 year highs seen in the Dow and S&P 500, you might want to check out a monthly chart of the Midcap index as it powered to yet another all-time high yesterday. Yep, that’s right; there is no sign of a secular bear market in the ‘middies’ as this chart continues to look quite strong. (more…)
SUMMARY:
- Muddled jobs report and still the market rises.
- NASDAQ pushes past January high, SOX surges, leaving the small caps odd man out.
- Unemployment rate dives and so do non-farm jobs. Things are better, things are worse, but you have to assume overall improvement, right?
- Oh Canada. Four times more jobs than expected.
- Bonds diving as the problem that was holding it in its range likely won’t topple the recovery.
- Dollar recovering, but a long way to go to credibility.
- Irrepressible stock market continues to push higher, fueled by the Fed’s liquidity supertanker.
- Retail, tech coming back around, starting to lead once more.
(more…)
Until Friday, the BLS’ monthly report on Nonfarm Payrolls was considered the Big Kahuna of economic data. This was the report that set the tone for the market and made or broke traders’ short term plans. It was the Jobs report and the accompanying data on the level of Unemployment in the U.S. that told the boys and their computer toys which way to run their programs. In short, if you got the Jobs report right, the rest was easy. (more…)
SUMMARY:
- Despite good economic data, NASDAQ sells back from the peak, but then Bernanke brings them back.
- Jobless claims fall. Weather holding them back?
- Productivity soars to 2002 levels
- ISM Services beats expectations but not 60
- Factory orders positive when expected to turn in a negative showing
- Same Store Sales expectations topped by two-thirds of respondents
- NASDAQ still at the prior highs, but now with a bit better standing as it just won’t die, instead consolidating laterally.
- Looking for jobs move the market off the dime here at resistance.
(more…)
One of the toughest things to do in this business is to try and identify what is causing the market to do whatever it is that it happens to be doing at the moment. Whether you are attempting to do this on an hourly basis, day-by-day, or from a macro point of view, it is often difficult to take your emotions and perhaps, more importantly, your opinions out of the mix long enough to see the forest for the trees. (more…)
SUMMARY:
- Stocks fail to make headway after the big Tuesday move. Worried about spreading unrest, technical issues, or new money running out? Yes.
- Tuesday’s value buying gives way to Wednesday’s ‘valuation’ selling, at least according to the writers.
- ADP jobs index tops expectations, but after last month’s miss no one really paid attention.
- Materials prices starting to impact earnings, or so we are told. It is a built in excuse as comps over the prior year get tougher.
- Better economic data cannot, as of yet, push growth indices through their prior peaks. That good data is raising expectations for makes the jobs report even more important.
(more…)
After three days of excitement, things appeared to calm down a bit at the corner of Broad and Wall yesterday. And while there was some intraday volatility and it is a safe bet that there were some programs run (this time in both directions), the bottom line is there didn’t appear to be anybody home in the bear camp on Wednesday. (more…)
SUMMARY:
- Despite spreading geopolitical issues, investors focus on domestic earnings and economics and send stocks higher.
- Stocks were up but rather incongruously, other markets fell.
- National manufacturing jumps past expectations.
- December construction spending tanks but investors give it a pass.
- SP500 breaks to a new rally high, and while NASDAQ and company looked strong, they still have to deal with the recent highs.
(more…)
In a way, it’s laughable the way the market has acted over the last three days. One minute the sellers are crying wolf and hitting the market with every sell program they can find because of the powder keg in the Middle East (and for the record, when isn’t the Middle East a powder keg waiting to explode at any moment?) and the next, oh, that’s right, the market is closing at new highs for the bull market cycle. (more…)
SUMMARY:
- Stocks shake off continued Egyptian protests take back some Friday losses.
- Stocks may feel better about Egypt, but oil is hedging its bets.
- Will the winter of discontent in North Africa spread?
- Personal income and spending continue expansion.
- Chicago PMI surges to a 12 year high.
- EU inflation running hotter than expected.
- Stocks did rebound, but the rebound did not change the general theme heading into the North African unrest.
(more…)
Sometimes no news is good news and from our perspective, such was the case on Monday. Sellers who had fled the market en masse on Friday for fear of the headlines that might come out of Egypt over the weekend seemed to return to the game in a better mood. More accurately, it appeared that some of the shorts decided to run for cover on Monday in response to another batch of decent economic news and the fact that there was no real escalation of the situation in the Middle East. (more…)
