Aug 29th 2014 – Best August in 14 Years For S&P 500

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Market View:

It’s a real kickback to pre-world war II years, when strangely August was the best trading month of the year.  Since then the sell in May and go away became popular, but again hasn’t worked so well this year!

The bulls bought the bottom again today and pushed it higher, we may see the S&P 500 move away from 2000 now, starting next week.

Market holiday on Monday, so have a great long weekend!

Market News:

U.S. stocks rose on Friday, lifting the S&P 500 to another record finish, as investors welcomed a better-than-expected read on U.S. consumer confidence and bypassed geopolitical worries.

The Thomson Reuters/University of Michigan’s final take on consumer sentiment rose to 82.5 in August from 81.8 the month before.

Ahead of the open, stock-index futures trimmed gains after consumer spending unexpectedly declined in July, off 0.1 percent after rising 0.4 percent the month before, the Commerce Department said.

Data from overseas had euro-zone inflation declining to a five-year low this month, with consumer costs in the 18 nations that use the euro climbing 0.3 percent year-on-year last month, the European Union’s statistics office Eurostat reported.

U.K. Home Secretary Theresa May said the government was hiking the terror threat level to severe, based on intelligence from Iraq and Syria.

Wall Street also tracked the situation between Russia and Ukraine, with fighting between separatists and government forces reportedly intensifying and NATO releasing satellite images of Russian troop movements in eastern Ukraine, a claim dismissed by Russia.

The European Union and United States are warned of additional sanctions against Russia, even as the EU started discussions in Moscow on Friday targeting an interim agreement with Ukraine to restart natural-gas flows.

News Sources:  CNN Money & CNBC


Aug 28th 2014 – Ukraine Tensions Overshadow Good Data Reports

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Market View:

Well, there is that geopolitical noise again.  Given the data, today should have been a significant rally, but alas, Putin’s cat and mouse game with the west is deflating hopes of a quick end to the fighting there.  Let’s hope we have peace or at least positive talks soon.

At the end of the day the market has to do some selling before it goes back up again.  So I am somewhat pleased that we have had two weak days in a row now.  However, the Ukraine crisis is having a significant impact on the indexes, so it is impossible to say what will happen next (even more than it is usually!)

Market News:

U.S. stocks declined on Thursday, pulling the S&P 500 back below 2,000, as concerns about Ukraine overtook upbeat reports on the U.S. economy and the labour market.

Figures from the Commerce Department showed the economy expanded more than previously projected, with gross domestic product rising at a 4.2 percent annualized pace, versus an earlier estimate of 4 percent that follows contraction in the first quarter.

Another report from the Labour Department had the government’s count of Americans filing for jobless benefits dropping by 1,000 to 298,000 last week.

And, the National Association of Realtors reported more Americans signed contracts to buy existing homes in July, with its index of pending home sales up 3.3 percent.

But the better-than-expected data was overshadowed by reports of intensified fighting in Ukraine, with that nation’s president on Thursday saying Russian troops had entered the country and were fighting along alongside Russian-backed separatists.

Friday:

8:30 a.m.: Personal income/spending

9:45 a.m.: Chicago PMI

9:55 a.m.: Consumer sentiment

News Sources:  CNN Money & CNBC


Aug 27th 2014 – Stocks Little Moved As S&P 500 Ends Above 2,000 Again

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Market View:

I was actually hoping that we would see a little selling today, without a little selling after such a run up, it makes me nervous for a market one day shock drop.

If the market lets off a little steam, it creates opportunities for others to buy the dip and would allow it to see another big rally up away from the 2000 mark.  I would like to see the shorts get squeezed here, but as it stands with a sideways move, we are in no man’s land.  So it will be up to data reports and what is left of earnings and any M&A news to drive the markets higher.

Hopefully without any geopolitical noise too!

Market News:

U.S. stocks ended little moved on Wednesday as Wall Street caught its breath, with the S&P 500 closing at a record just above 2,000 for a second consecutive session.

Finishing at a record just above the 2,000 milestone for a second day, the S&P 500 added a fraction to 2,000.12, with utilities the best performing of its 10 major sectors.

The Nasdaq declined 1.02 point to 4,569.62.

Traders tracked events in Ukraine, with the U.S. State Department saying Russia had sent additional tanks and armored vehicles into Ukraine in what the Obama administration believes is a new military counter offensive.

Thursday

Earnings: Dollar General, Splunk, Abercrombie and Fitch, Toronto Dominion, Pall Corp, Signet, Canadian Imperial Bank

8:30 a.m.: Initial claims

8:30 a.m.: Q2 GDP (second reading)

10:00 a.m.: Pending home sales

11:00 a.m.: Kansas City Fed survey

1:00 p.m.: $29 7-year note auction

News Sources:  CNN Money & CNBC


Aug 26th 2014 – S&P 500 & Dow Hit New Records

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Market View:

Take a look at the above picture, this is a real trading chart for the last few trades on UDOW.  This is the system at its best, getting out at the top, letting it fall and getting back in at the bottom of a new trend…beautiful!

Today we had another advance after some good reports on the US economy.  Seems that it is all good news right now, with geopolitical issues being the only worry.

Hopefully something good will come out of the meeting in Belarus between Russia and the Ukraine, perhaps there will be further news about that tomorrow.

I expect a day of selling tomorrow as the weak hands profit take for fear of losing out.  But as the old saying goes, it is important to let you winners run.

Market News:

U.S. stocks rose on Tuesday, lifting the Dow to an all-time high and the S&P 500 to its first finish above 2,000, after better-than-expected reports, including a jump in orders for durable goods, cast favourable light on the U.S. economy.

A measure of consumer confidence hit 92.4 in August, exceeding estimates of 89.

Another report had home prices rising at a slower rate in the year ending in June, with the S&P/Case-Shiller index of property values increasing 8.1 percent from June 2013.

In addition to economic reports, geopolitics was back in play, with the presidents of Russia and Ukraine meeting Tuesday in Belarus, and Palestinian officials saying a Gaza truce had been reached with Israel under Egyptian mediation.

Wednesday:

Earnings: Brown Forman, Chico’s, Tiffany, Williams-Sonoma

1:00 p.m.: $35 billion 5-year auction

News Sources:  CNN Money & CNBC


Aug 25th 2014 – S&P 500 Hits 2000, Closes At Record High

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Market View:

Happy first day back from 2 weeks at the cottage!  S&P 500 hits the 2000 mark for the first time in history.  Although it was light volume as traders are still largely away from their desks as summer comes to a close and back to school starts swinging into high gear.

We are now approaching the bullish part of the year as we head towards Christmas, so hitting 2000 now in my mind is a good omen and I foresee we will close higher by year end.

I don’t expect much in the way of a rally tomorrow after today’s wonderful action, but I don’t expect to see much selling either.  Only Russia is the spanner in the works for this market, and for now that seems to have gone quiet…

Market News:

U.S. stocks rallied on Monday, with the S&P 500 crossing 2,000 for the first time, lifted by a round of corporate deals and optimism that the European Central Bank would embark on further moves to stimulate the European economy.

Today’s gains are largely due to Mr. Draghi’s comments, his assurances that the European Union is as dedicated to keeping their markets as healthy as the US is, it gave the market an excuse to test the 2,000 level.

Burger King Worldwide is in talks to combine with Tim Hortons and moves its headquarters to Canada. Switzerland’s Roche Holding has agreed to acquire U.S. biotechnology company InterMune for $8.3 billion in cash.

Monday’s economic reports included data from the Commerce Department, which showed sales of new single-family homes fallingfor a second consecutive month in July.

A survey from financial-data firm Markit had the pace of growth in the nation’s services sector declining for a second month in August, while a gauge of U.S. economic activity from the Chicago Federal Reserve illustrating expansion above historical trends.

Tuesday:

Earnings: Best Buy, Bank of Montreal, Aruba Networks, Trina Solar, Smith and Wesson, Sanderson Farms, Bob Evans, WPP

8:30 a.m.: Durable goods

9:00 a.m.: S&P/Case-Shiller home prices

9:00 a.m.: FHFA home prices

10:00 a.m.: Consumer confidence

10:00 am Richmond Fed survey

1:00 p.m.: $29 billion 2-year auction

News Sources:  CNN Money & CNBC


Monday Aug 11th 2014 – Stocks Advance Again Despite Geopolitical Worries

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Market View:

I like the look of this bounce and I hope it will continue up from here.  I am cautiously invested here but happy to see the rhetoric from Russia come down a tad in the last couple of days.

There are not a lot of key reports out this week, but there will be a couple of fed speakers talking.  Volatility is coming from either the Russian/Ukranian crisis or the possibility of the Fed giving hints of a rise in interest rates any time soon. Should both of these fears subside for a while longer, we will almost certainly be reaching for a new all-time high before the end of my vacation.

This will be my last blog post for a couple of weeks as I head to the cottage for a nice relaxing summer vacation. Next blog post will be Monday 25th August.

Market News:

U.S. stocks pared gains in light volume trading on Monday as investors looked for signs of easing in geopolitical tensions.

Trading across all platforms of the New York Stock Exchange at 2:40 p.m. ET was 1.9 billion, short of the 3.1 billion average.

Earlier in the day, Russian President Vladimir Putin said his country is coordinating with the International Red Cross to send humanitarian aid to Ukraine, the Kremlin stated.

Over in Gaza, Israel and the Palestinians agreed on Sunday to an Egyptian proposal for a new 72-hour ceasefire. President Barack Obama said on Saturday that U.S. airstrikes had already destroyed arms that Islamic State militants could have used against Iraqi Kurds. He did warn, however, that there would be no “quick fix” to the crisis.

Over 85 percent of S&P 500 firms have now reported their second-quarter results. So far, the earnings-per-share (EPS) beat:miss ratio is running at a pretty solid rate of around 3:1, according to Deutsche Bank. The ratio is lower for sales revenue, with just short of two-thirds of firms exceeding consensus estimates.
A break from economic reports on Monday will put focus on data releases from Tuesday onward, with the monthly budget and JOLTs jobs series.

Equities were also given a boost by Stanley Fischer, the vice chairman of the U.S. Federal Reserve, who said early on Monday that the recoveries in the U.S. and global economies had been “disappointing” thus far, indicating the Fed may not imminently tighten its monetary policy.

On tap this week:

Tuesday

Earnings: Bob Evans, Fossil, JDS Uniphase, Valspar, Flowers Foods, Cree

7:00 a.m.: NFIB small business survey

10:00 a.m.: JOLTs

1:00 p.m.: 3-year note auction

2:00 p.m.: Budget

Wednesday

Earnings: Deere, Macy’s, Cisco, SeaWorld, NetApp, Noodles, Surgical Care Affiliates, Iamgold

7:00 a.m.: Mortgage applications

8:30 a.m.: Retail sales

0905 a.m.: New York Fed President William Dudley

9:20 a.m.: Boston Fed President Eric Rosengren

10:00 a.m.: Business inventories

1:00 p.m.: 10-year note auction

Thursday

Earnings: Wal-Mart, Nordstrom, J C Penney, Kohl’s, Red Robin Gourmet, Advance Auto Parts, Agilent

8:30 a.m.: Jobless claims

8:30 a.m.: Import prices

1:00 p.m.: 30-year bond auction

Friday

Earnings: Estee Lauder

8:30 a.m.: PPI

8:30 a.m.: Empire manufacturing survey

9:00 a.m.: TIC data

9:15 a.m.: Industrial production

9:15 a.m.: Capacity utilization

9:55 a.m.: University of Michigan consumer sentiment


Aug 8th 2014 – Stocks Jump on Russia Pullback Reports

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Market View:

Good news on the obvious thing that was holding back the markets from jumping on good economic news and earnings reports for the week.  A reliable source showing that Russia is interested in de-escalating the Ukrainian crisis.  Let us hope that is the case.

If it is, it’s risk on time again and this market correction should find it’s feet and at least create a lower high is not shoot for a new all-time high soon.

Market News:

U.S. stocks jumped on Friday, with benchmark indexes turning higher for the week, on signals of reduced tensions in the Russian-Ukraine crisis and as Wall Street viewed American military moves in Iraq as limited.

Reuters, citing Russia’s Interfax, reported that Russia had ended military exercises near the Ukrainian border. The war games, which began Monday, were scheduled to end Friday, according to media reports including the Guardian.

The CBOE Volatility Index, a measure of investor uncertainty, fell 5.6 percent to 15.73.

Ahead of Friday’s open, stock-index futures had fallen on word President Barack Obama had authorized air strikes in Iraq, only to turn higher on reports that Russia might to be looking to de-escalate tension over Ukraine.

The Pentagon’s press secretary said via Twitter on Friday that U.S. military aircraft had struck rebel artillery that was being used against Kurdish forces defending a position near American personnel. American officials told NBC News on Friday afternoon that U.S. military warplanes had launched another round of airstrikes against an Islamic State target in Iraq.

Stock-index futures had risen on a news report signaling Russia might be looking to de-escalate the Ukraine conflict, offsetting declines that came with President Barack Obama’s decision to authorize airstrikes in Iraq.

Geopolitical concerns overtook economic reports, which on Friday included data from the Labor Department that had nonfarm productivity rebounding more than expected in the second quarter, with a drop in labor costs pointing to still-tame wage pressure.

Separately, the Commerce Department reported wholesale inventories rose less than expected in June.

Thursday evening, Obama told a press conference he had authorized the U.S. military to make targeted airstrikes to protect American personnel in Iraq. His remarks came as the U.S. began an effort to drop humanitarian aid to Iraqi civilians in the northwest of the country.

News Sources:  CNN Money & CNBC


Aug 6th 2014 – Stocks Shake off Putin Jitters

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Market View:

After stumbling early on, stocks recovered to close higher.  Just a few days ago the S&P 500 appeared to be on a path to break through the 2,000 mark for the first time ever. Now the index of U.S. stocks is having trouble keeping its head above 1,900. Similarly, the Dow, which crossed 17,000 for the first time in early July, is around 16,500.

It is impossible to tell what will happen next as the geopolitical instability caused by Russia ensues.  If it was just about the market I would say that we would almost certainly be heading higher from here to at least make a significant lower high on the Indexes.  But with the Ukraine still in crisis and fighting escalating, we will just have to wait and see.

Market News:

U.S. stocks advanced, with the S&P 500 making a limited comeback off a two-month low, as investors sorted through developments in Ukraine and considered two derailed deals.

Strategists said technical factors were in play, with the S&P 500 holding 1,920 at Tuesday’s close seen as bullish, as well as Wednesday’s testing and bouncing back off of the prior session’s intraday low of 1,913.

Equities offered little reaction to a report from the Commerce Department, which said the nation’s trade deficit narrowed more than expected in June, suggesting trade was less of a drag on second-quarter economic growth than previously thought. Goldman Sachs and JPMorgan hiked their prior and current-quarter growth expectations on the heels of the report.

Europe’s economic data on Wednesday showed Italy falling back into recession, and German factory orders declining 3.2 percent in June from the month before, with the disappointing numbers illustrating the impact of sanctions against Russia, a major trading partner for Germany.

Russia President Vladimir Putin on Wednesday moved to ban agricultural and food products from nations that have enacted or backed sanctions against Russia.

Sea of red overseas: European markets tumbled overnight amid fresh evidence of the pain being inflicted by the crisis in Ukraine and slow growth in general. But the major indexes trimmed their losses in recent action.

Germany’s Dax index fell almost 1% before rebounding somewhat as a new report showed factory orders unexpectedly fell 3.2% in June. The government blamed “geopolitical developments and risks” for the slump.

Italy’s stock market dropped 2.7% on new data revealing the country’s economic fall back into contraction mode during the second quarter.

Meanwhile, nearly all Asian markets ended the day with losses. Japan’s Nikkei fell 1% Wednesday – leading the index to a full 3.1% drop over the last five trading days. China stocks were steadier, as they continue to bounce back from first half losses.

Thursday

Earnings: Wendy’s, Orbitz, CBS, Monster Beverage, News Corp, Nvidia, Mylan Labs, AMC Networks, Zynga, Lionsgate, Sprouts Farmers Market, Windstream,Duke Energy, Sempra Energy, Stratasys, Teradata, Computer Sciences, GreatPlains Energy

Weekly chain store sales

8:30 a.m. Initial claims

3:00 p.m. Consumer credit

News Sources:  CNN Money & CNBC


Aug 4th 2014 – Dip Buying Monday

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Market View:

Still in cash, even after today, but I will be dipping my toes back in tomorrow to see if we can at least generate a significant multi-day move up to establish, at least, a lower high.  I think we may be a month or two away from a new All Time High, but then I am still convinced that we will see another one before then end of the year.

Had news not broke that the Potuguese bank not been bailed out it could have been carnage today, but as it was, the government has stepped in to protect the general public at least.

I am suspicious of this strong dip buying bounce though and I think we will only go sideways tomorrow after today’s big bounce back.

Market News:

U.S. stocks climbed on Monday, with the S&P 500 bouncing back from its biggest weekly drop since 2012, as more companies reported results.

Of the 381 S&P 500 companies that have reported second-quarter results, 68.8 percent have beat estimates on earnings, and 64.1 percent have topped expectations for revenue, according to David Aurelio, research analyst at Thomson Reuters.

After wavering between positive and negative terrain, benchmark indexes took a definitive turn higher as the session progressed.

After a 102-point leap that brought it temporarily back into positive terrain for the year, the Dow Jones Industrial Average gained 75.91 points, or 0.5 percent, to 16,569.28.

The S&P 500 rose 13.84 points, or 0.7 percent, to 1,938.99, with energy pacing gains and utilities the worst performing of its 10 major industry groups.

Another bank rescue: Portugal’s central bank announced it is using €4.9 billion ($6.6 billion) to rescue Banco Espirito Santo.

The move involves splitting the troubled bank into a “good” and “bad” bank, and aims to protect taxpayers and bank customers. Shareholders and some bond holders will lose out. Shares in BES were suspended Monday but have slumped 87% so far this year.

Portugal’s benchmark PSI 20 index edged up by 1.8% Monday, though the index has declined by 11% since the start of the year.

International markets: European markets were mixed. Asian markets also turned in an uneven performance.

Tuesday:

Earnings: Disney, CVS Caremark, Archer Daniels Midland, MGM Mirage,Michael Kors, Cablevision, Scotts Miracle-Gro, Time Inc., Frontier Communications, Groupon, Potbelly, Take Two Interactive, FireEye, First Solar, Zillow, Liberty Interactive, Liberty Media, Regeneron, Activision Blizzard, Toyota

10:00 a.m. ISM nonmanufacturing

10:00 a.m. Factory orders

News Sources:  CNN Money & CNBC


Aug 1st 2014 – Another Volatile Day Driven By World Market Declines

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Market View:

Back to cash!  But the picture above is why I love the trading system so much, we get out so many times near the top in a lot of our watchlist and quickly get the opportunity to buy back in when the market gets oversold.

What it will do now is anybody’s guess.  I was taking a look at a number of stocks I used to watch and some of them have declines of 10% or more this week.  That’s a pretty decent correction, so perhaps we will turn around from here.

It is a typical bull market correction, brutal and swift.  However I like these type of corrections as it allows me to buy everything cheaper, so let it fall!

Market News:

Several market strategists said there were few fundamental reasons driving the market lower, other than it’s been a long while since equities had a sizable pullback.

“The market is ripe for a pullback; anxieties are sufficiently high enough for that to occur,” said Mark Luschini, chief investment strategist at Janney Montgomery Scott.

“The market feels like an overtired child, no matter what you do for it, it’s going to burst out crying,” said David Kelly, chief market strategist at J.P. Morgan Funds.

“If you think about it, how long has the entire world been calling for a five percent correction?” said JJ Kinahan, chief strategist at TD Ameritrade.

Ahead of Wall Street’s open, stock-index futures scaled back their drop in the wake of the data, which found nonfarm payrolls rose by a less-than-expected 209,000 last month and the jobless rate rose to 6.2 percent.

On CNBC Friday, Dallas Fed President Richard Fisher said he believes more of his colleagues on the Federal Open Market Committee are coming around to his view that the rates could start rising early next year if the data keep coming in stronger.

Wall Street offered muted reactions to other economic reports on Friday.

The ISM manufacturing index hit 57.1 in July; construction spending fell 1.8 percent in June and a gauge of consumer sentiment from the University of Michigan/Thomson Reuters declined slightly in July.

European markets fell, following the lead of the U.S on Thursday.

Germany’s Dax tumbled on concerns about the impact of escalating tensions with Russia on the region’s fragile economy. The EU turned up the heat on Moscow Thursday by including Russia’s biggest bank, Sberbank, on its list of sanctions targets.

News Sources:  CNN Money & CNBC