March 28th 2014 – Stocks Gain, But Down For The Week

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U.S. stocks trimmed their gains Friday afternoon, with the S&P 500 down for a second week in three, as investors positioned for the end of the quarter on Monday.

J.P. Morgan on Friday revised its estimate of real annualized GDP growth in the first quarter from 2 percent to 1.5 percent, while leaving its projection for the second quarter unchanged at 2.5 percent.

A report Friday had consumer spending rising 0.3 percent in February after climbing by a revised 0.2 percent in January. Income rose 0.3 percent last month after rising by the same margin in January.

Another report Friday from the Thomson Reuters/University of Michigan index found consumer sentiment hit 80 in March, just below an 80.5 estimate.

In a speech reported by state media on Friday, China’s premier indicated the Beijing government was prepared to take action to bolster the world’s second biggest economy, saying the government would gradually roll out targeted measures to help economic activity.

And on Wednesday, Germany’s Bundesbank said the ECB could buy loans and other assets from banks to support the euro-zone economy, with the statement marking a dramatic departure from its previous stance on the policy.

News Sources:  CNBC and CNN Money

My Market View:

An interesting turn of event technically.  It was getting a bit oversold, and particularly on the Nasdaq and small caps stocks, so perhaps we will see a multi-day bounce here.  But it certainly remains choppy and directionless.


March 27th 2014 – Stocks Dragged Down By The Banks

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U.S. stocks slid on Thursday after mixed economic reports cast a favourable light on the labour market while also illustrating the economy expanded less than economists expected at the end of last year.

The Commerce Department reported gross domestic product grew 2.6 percent in the final three months of last year, better than the 2.4 percent rate projected in February, but just below the 2.7 percent estimated by economists.

Separately, numbers from the Labour Department had jobless claims falling by 10,000 to 3111,000, a level that has it at a near four-month low.

And, the National Association of Realtors reported pending home sales fell for an eighth month in February, with sales down 10.5 percent from a year ago.

Friday:  8:30 a.m.: Personal income and consumer spending for February, 9:55 a.m.: University of Michigan/Reuters consumer sentiment for March, 1:15 p.m.: Fed’s George speaks

News Sources:  CNBC and CNN Money

My Market View:

S&P formed quite the wedge today into the close, so it is likely that we will see a relief rally in small caps and the Nasdaq tomorrow.  It has been a dismal time for stocks on the Nasdaq over the least 5 trading days.  A bounce is overdue now.


March 26th 2014 – Stocks Close Down on Heightened Ukraine Worries

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U.S. stocks slid on Wednesday, with benchmark indexes failing to maintain a second day of gains, after President Barack Obama cautioned against complacency on Russian moves in Ukraine.

Ukraine and the International Monetary Fund held bailout discussions Wednesday as the United States and European allies cautioned that they would take further steps if Russia escalates the crisis after annexing Crimea.

Speaking in Brussels, Obama said Russia’s actions had to be condemned.

Financial-data firm Markit reported its Purchasing Managers Index hit 55.8 in March, up from 54.1 a month earlier.

After the market close, the Federal Reserve follows up on its yearly stress tests of the nation’s 30 largest lenders, with regulators expected to signal whether institutions including Citigroup and Bank of America can go ahead with proposed dividends and share buybacks.

Thursday:  8:30 a.m.: GDP revision Q4, 8:30 a.m.: Weekly jobless claims, 8:30 a.m.: Fed’s Pianalto speaks, 10 a.m.: Pending home sales index for February, 10:30 a.m.: Natural gas inventories, 11 a.m.: Kansas City Fed manufacturing index, 1 p.m.: Seven-year note auction, 4 p.m. Fed balance sheet/money supply, 9:30 p.m.: Fed’s Evans speaks

News Sources:  CNBC and CNN Money

My Market View:

There is an odd imbalance happening right now between the tech heavy Nasdaq and the Dow Jones and S&P 500.  It is very unusual for the Nasdaq to decline so much in such a short space of time while the others are not showing the same kind of volatility.  I am still looking for a bounce back within the Nasdaq.  It is approaching oversold levels, so a bottom should be in place soon, at least in the short term.


March 25th 2014 – Stocks Jump With Consumer Confidence

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U.S. stocks climbed on Tuesday, with equities bouncing back after two days of losses, as investors embraced data that had consumer confidence hitting a six-year high in March.

The Conference Board reported consumer confidence rose to 82.3 in March, up from 78.3 the month before; another report from the Commerce Department had new-home sales slipping 3.3 percent in February. And, the S&P/Case-Shiller index of property values in 20 cities climbed 13.2 percent from January 2013.

Federal Reserve Bank of Philadelphia President Charles Plosser told CNBC Tuesday Fed members found were surprised by the market’s reaction to recent policy statements, saying they tried to say quite explicitly that the central bank’s view had not changed.

European markets finished higher. Asian stock markets mostly ended lower, though the moves down were modest.

Wednesday: 2 a.m.: Fed’s Bullard speaks, 7 a.m.: Mortgage applications, 8:30 a.m.: Durable goods orders for February, 9:45 a.m.: PMI services flash, 10:30 a.m.: Oil inventories, 1 p.m.: Five-year note auction

News Sources:  CNBC and CNN Money

My Market View:

Philadelphia President Charles Plosser comments and consumer confidence numbers where cheered in the markets.  It was looking very dire at midday at the lows of the day.  Really needed that good news.  What now will depend on the data tomorrow.  We are due a bounce back in my opinion, particularly in the Nasdaq, so I will be looking for the market to recover and close higher for the week again.


March 24th 2014 – Markets Lower For Second Day

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U.S. stocks fell for a second session on Monday as investors shed some of the Nasdaq’s high flyers.

A final reading on U.S. manufacturing slipped in March, with the report from Markit Economics had factory activity slowing to 55 in March from a near four-month-high of 57.1 in February, with readings above 50 signaling expansion.

Ahead of Wall Street’s open, the flash Markit/HSBC Purchasing Managers’ Index had Chinese manufacturing contracting in the first quarter of the year, boosting hopes that China’s government might take steps to stimulate the economy.

European stock markets closed mostly lower as the Russian takeover of Ukraine’s Crimean peninsula continues to dominate sentiment.

Asian markets ended with some significant gains though, despite HSBC data that showed Chinese manufacturing activity fell to an eight-month low in March. The Hang Seng in Hong Kong shot up by 1.9% and the Shanghai Composite rose by 0.9%.

Tuesday: 9:00 a.m.: FHFA home prices for January, 9:00 a.m.: S&P Case-Shiller home prices for January, 10 a.m.: New home sales for February, 10 a.m.: Consumer confidence for March, 10: a.m.: Richmond Fed manufacturing index, 1 p.m.: Two-year note auction, 4 p.m.: Fed’s Lockhart speaks, 7 p.m.: Fed’s Plosser speaks

News Sources:  CNBC and CNN Money

My Market View:

Another tough day for the Nasdaq, two tough days in a row.  I expect a bounce back probably tomorrow.  The market is getting choppy, but I think that the technology heavy exchange will rebound a little from these steep declines.  We could have a confirmed double top on the S&P 500, but it may also be just  normal resistance with regards to creating a new all time high close.  It may punch above in the coming days.

Lots of Fed speakers and tomorrow and some key data to give direction to the markets.


March 20th 2014 – Markets Shake off Yellen’s Rate Comments to Close Higher

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U.S. stocks climbed today as reports on U.S. leading indicators and regional manufacturing spurred optimism the nation’s economy would strengthen after first-quarter weakness, helping offset concerns that interest rates could climb quicker than had been anticipated.

Data released Thursday had the count of Americans filing for jobless benefits rising by 5,000 to 320,000 last week, less than the 325,000 estimated by economists polled by Reuters. The four-week moving average for new claims, viewed as a better gauge overall of labour conditions, dropped 3,500 to 327,000, the lowest since November.

Other reports had existing-home sales for February falling to 4.60 million compared to a 4.66 million estimate. Leading indicators rose 0.5 percent in February, versus estimates of a 0.4 percent rise, and the Philadelphia Fed’s manufacturing gauge climbed to 9.0 in March from negative 6.3 the previous month.

News Sources:  CNBC and CNN Money

My Market View:

Well so far my prediction of market calm after yesterday’s unnecessary dip has panned out.  I very much doubt we will see much by way of a move up or down tomorrow.  It is Quadruple witching day, which means it is the expiry day for the entire options world, from futures to equity options.  There tends not to me much of a move on these days in my experience.


March 19th 2014 – Stocks Drop After Yellen Speaks of Rate Hikes

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Stocks eased off session lows but still finished firmly in the red today after Federal Reserve Chair Janet Yellen suggested interest rate hikes would happen about six months after quantitative easing ends.

In its policy statement, the Fed said the benchmark federal-funds rate will remain near zero for a “considerable time” after its asset-purchase program ends. Yellen attempted to clarify the term, saying it is “hard to define” but “probably means something on the order of around six months.”

The $10 billion reduction was largely in line with market expectations. The decisions passed on an 11-1 vote, with Narayana Kocherlokota voting against.

The Fed dropped the unemployment rate as its definitive yardstick for measuring the strength of the economy and emphasized it would rely on other factors in deciding when to boost interest rates.

Reiterating the Federal Open Market Committee’s statement, Yellen said policy makers agree inflation will rise “gradually” toward the central bank’s 2 percent target, despite recent readings well short of that objective.

Yellen also noted that the labour market has improved faster than had anticipated, though the economy still needs monetary support.

On Wednesday, Vladimir Putin signed a treaty formally making Crimea part of the Russian Federation, but said he was not looking to take control of any other regions of Ukraine at a speech in front of parliament on Tuesday, helping to calm markets.

News Sources:  CNBC and CNN Money

My Market View:

I think there was a sense of panic at the time of Janet Yellen’s statement which quickly recovered.  I think she just felt first-hand the power she wields with every word that comes out of her mouth.

The taper was expected, but that’s still leaves $55 billion being pumped in this month.  And when her remarks were clarified about the rate changes, the market quickly recovered, so all in all, not much by the way of controversy in my opinion.  As a lot of people are talking about this being the top for a while, I am going to take the contrarian view and say that I think we will see a new all-time high soon.


March 18th 2014 – Stocks Higher For Second Day On Housing Data & Putin’s Statement

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U.S. stocks rose again today, extending the prior day’s jump, after upbeat data on the U.S. economy and after Vladimir Putin said Russia was not looking to divide Ukraine.

Addressing the Russian parliament, Putin said Russia was not looking to take control of more of Ukraine after approving a plan to make Crimea a part of Russia after a referendum viewed as illegal by the United States and the European Union, which imposed sanctions on officials accused of taking part in Russia’s military takeover of the Black Sea peninsula.

The Department of Commerce on Tuesday reported housing starts in February were down 0.2 percent from January and off 6.4 percent from the year-ago month, while a rebound in building permits offered hope for the housing market emerging from a soft patch.

The Federal Reserve on Tuesday started a two-day policy-setting session, with the central bank expected to continue tapering asset purchases.

Another report Tuesday had the Labour Department’s Consumer Price Index edging up 0.1 percent last month as a drop in gasoline costs offset an increase in the price of food.

News Sources:  CNBC and CNN Money

My Market View:

Now it’s the Fed’s turn to direct the flow of the market, with Yellon giving here first statement tomorrow, usually around 2pm.  I think the influence of the Ukraine conflict on the market will be less in the coming days and weeks now.  Matters of home economics will come back to focus.

Seems that this dip was a buying opportunity, we may see another all-time high before long, however, a lower high may also be in play, so I am hopeful that a new high will be in place by the end of this week to confirm a continuation of this upward trend.  Bring on the Bulls!


March 17th 2014 – Market Brushes Off Crimea Vote To Close Higher

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Stocks rallied today, with the Dow industrials rebounding after a five-day losing streak, as voting in Crimea passed without violence and after economic reports had U.S. manufacturing output jumping the most in six months in February.

On Monday, President Barack Obama imposed sanctions against Russian officials after voters in Crimea on Sunday endorsed separating from Ukraine to join Russia. The U.S. announcement came after the European Union announced travel bans and asset freezes on 21 people.

In a nationally televised news conference, Obama called the sanctions an initial step, and said the U.S. was ready to impose further sanctions should Russia escalate the situation.

Economic reports had U.S. industrial output rising in February; up 0.8 percent, and better than the 0.1 percent rise anticipated by economists polled by Reuters. And, the March Empire State Factory Index climbed to 5.61 in March after a reading of 4.48 the prior month.

Stocks maintained gains after a monthly measure of home builder confidence rose a tepid 1 point to 47 in March, with the latest reading still below 50, the line between positive and negative on the survey released by the National Association of Home Builders.

On Tuesday, the Federal Open Market Committee starts a two-day meeting that is widely expected to have monetary policy makers continuing to taper asset purchases. The FOMC has so far trimmed monthly bond buys to $65 billion from $85 billion in December.

Russian markets, which have been slammed so far this year by the rising tensions with the West over Ukraine, also showed signs of stabilizing. The main European markets all closed higher, while Asian markets ended mixed.

News Sources:  CNBC and CNN Money

My Market View:

You just never know how the market will respond sometimes.  With the vote being passed in Crimea in favour of re-joining Russia and sanctions being imposed by the western nations, you would expect another day of volatility towards the down side, not a big bounce we received.

Now the focus turns to the Fed meeting this week.  This will be Janet Yellen first chaired meeting.  I doubt she will do anything to spook the market, possibly even holding off on the taper this month??


Ukraine Drags Down Stocks Again Ahead of Key Vote

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U.S. stocks declined today, with the Nasdaq Composite posting its first weekly drop in six, as concern escalated about Ukraine, two days before a vote in Crimea on joining Russia.

U.S. Secretary of State John Kerry and Russian Foreign Minister Sergei Lavrov met in London Friday, and were unable to alleviate the situation. Russia had warned Ukraine’s government had lost control of the nation, and the U.S. and the European Union said Russia would face sanctions if it does not back off from taking control of Crimea, where a referendum is scheduled for Sunday on whether to join Russia.

Kerry told a televised news conference that Russian President Vladimir Putin was not ready to “make any decision regarding Ukraine until after the referendum on Sunday.”

Ukraine and the West have described the vote as illegal. They have accused Russia of violating Ukraine’s sovereignty and are threatening sanctions.

Russia’s benchmark index had its biggest weekly drop in two years, down more than 7%. For the year the index is down more than 17%.

The ruble weakened further against the dollar. Russian markets have been hit hard by fears that the crisis will deter foreign investment and wipe out growth this year.

The Nikkei in Japan dropped more than 6% this week. Recent poor export figures from China have sparked worries about the pace of growth in the world’s second biggest economy and has sent some investors to seek safety in Japan’s yen.

Separate economic data showed producer prices unexpectedly fell last month, with the 0.1 percent decline in the producer-price index coming after a 0.2 percent climb in January, the Labour Department said.

News Sources:  CNBC and CNN Money

My Market View:

What can you say, the market doesn’t like uncertainty, there is much headline risk over the weekend thanks to this vote.  The best case scenario for the market is for the vote to go the way of staying part of the Ukraine, otherwise it will cause further volatility next week.