Showing posts with label consumer cyclicals. Show all posts
Showing posts with label consumer cyclicals. Show all posts

Tuesday, November 13, 2018

Dow Down 100, NASDAQ Up 0.01; Crude Oil the Culprit

From the You Can't Make This Stuff Up Department:

The Dow was down 100 points (and 69 cents, but who's counting), while the NASDAQ finished a hectic day of trading with a gain of 0.01. All told, this was a losing session, as both the S&P 500 and NYSE Composite ended the day underwater.

One might have assumed that Tuesday's losses were an extension from Monday, with Apple leading stocks lower, but, even though the Cupertino computer colossus did finish lower by an even one percent, the biggest losers on the Dow were energy companies ExxonMobil and Chevron, which bracketed Boeing (BA), a 2.11% loser. XOM lost 2.29%. CVX was down 1.74%.

Volatility in stocks is making everybody crazy. The Dow was up 1075 points over the first six sessions in November, but has given back 905 in the past three sessions, leaving it up a mere 170 points for the month, one which traditionally is among the best for long players.

Thus, the answer to the question of what moved markets today is simple: the price of oil, as WTI crude lost ground for the 12th straight day. At $55.19, it's at the lowest level since November last year. Tuesday's decline was also the largest during the recent rout, down nearly eight percent.

Saudi Arabia reduced its estimate for global demand from two million barrels per day to 1.29 million, sending the price sharply lower. Oil peaked on October 3rd, above $76/barrel, and has been on a diagonal course lower since, now officially in a bear market.

While the Saudi's may be fretting over demand and promising production cuts in the near future, the real villain in the oil patch is supply. There's been a glut of oil forever, and the only movement in price was due to artificial crises, forced production cuts, and pure speculation. In June of 2017, WTI crude oil was going for $46/barrel, but was bumped up continuously over the next 16 months before the recent setback. From all indications, reduced demand and oversupply could push prices down below $50/barrel before Thanksgiving and further declines might be a welcome Christmas present for drivers and those who heat their homes with oil.

A lower price for oil, and, consequently, for gasoline and other derivatives, should act to boost the general economy, allowing consumers more disposable income to spend on necessities and/or holiday splurges, all of which should be positive for markets. However, the math isn't quite so simple, as Americans, beset with record credit card and other debt, might tighten their collective belts and pay down some of those nasty, recurring, monthly bills on credit cards with interest rates well beyond what used to be considered usury.

For the pair traders out there, that would mean shorting oil stocks and financials while buying consumer staples and cyclicals.

Fun for everyone.

Dow Jones Industrial Average November Scorecard:

Date Close Gain/Loss Cum. G/L
11/1/18 25,380.74 +264.98 +264.98
11/2/18 25,270.83 -109.91 +155.07
11/5/18 25,461.70 +190.87 +345.94
11/6/18 25,635.01 +173.31 +519.25
11/7/18 26,180.30 +545.29 +1064.54
11/8/18 26,191.22 +10.92 +1075.46
11/9/18 25,989.30 -201.92 +873.54
11/12/18 25,387.18 -602.12 +271.42
11/13/18 25,286.49 -100.69 +170.27

At the Close, Tuesday, November 13, 2018:
Dow Jones Industrial Average: 25,286.49, -100.69 (-0.40%)
NASDAQ: 7,200.88, +0.01 (0.00%)
S&P 500: 2,722.18, -4.04 (-0.15%)
NYSE Composite: 12,328.23, -15.28 (-0.12%)

Monday, November 11, 2013

Stocks Little Changed on Veteran's Day

With bond markets closed and many traders enjoying a three-day weekend by virtue of the Veteran's Day holiday, there was little to get excited about in equity markets or elsewhere.

The day's smallish gains were led by Consumer Cyclicals, Healthcare and Technology, counterbalanced by downside moves in Basic Materials and Telecoms, which lagged the market.

Volume was noticeably in short supply as was volatility, reverting back to levels seen this past summer. Despite the lack of interest, the Dow Jones Industrial Average closed at a new all-time high, with the NASDAQ and S&P sporting smaller gains.

New highs continued to outnumber new lows, though not as substantially as in recent weeks. The advance-decline line was nearly static, with winners beating losers by less than a hundred issues.

Commodities were largely flat-lining, though corn got a bit of a bid off recent 52-week lows.

Unless there's some earth-shaking development on Tuesday, tomorrow could be just as listless, as there are no meaningful economic data releases until Wednesday, and even then, those are hardly impacting.

Dow 15,783.10, +21.32 (0.14%)
Nasdaq 3,919.79, +1.67 (0.04%)
S&P 500 1,771.89, +1.28 (0.07%)
10-Yr Bond 2.75% 0.00
NYSE Volume 2,507,799,000
Nasdaq Volume 1,538,911,625
Combined NYSE & NASDAQ Advance - Decline: 2840-2754
Combined NYSE & NASDAQ New highs - New lows: 238-56
WTI crude oil: 95.14, +0.54
Gold: 1,281.10, -3.50
Silver: 21.28, -0.035
Corn: 434.75, +8.00

Monday, October 15, 2012

Did Retail Sales Power a Rare Monday Rally?

Retail sales for September, as reported on Monday prior to the opening bell, were up sharply year-over-year and were up 1.1% after a 1.2% rise in August.

So, did the retail sector fuel the rare Monday rally, which was only the third time stocks had shown gains on a Monday in the past 20 weeks?

Well, yes they did, as the Consumer Cyclical space gained 1.11%, the best sector gain of the day. Following were Health Care and Financials, the latter based largely on an earnings beat by Citicroup (C), which beat solidly on revenue as well.

The timing could not have been better for options players as October monthly options settle this week, on Friday, just in time for stocks to head to new highs and savvy options professionals cash in on their bets.

Trading on this Monday was a radical departure from last week's broad decline, with the advance-decline line repairing itself and new highs beating new lows by a 2-1 ratio.

Oddly enough, the market wins either way in the currently-convoluted presidential debate regime that is market psychology. With retail and stocks doing well, one would envisage an Obama victory on November 6, anathema to the markets, but, good numbers are good numbers, so, stock traders went along for the ride.

Sticking with the current thinking, even if retail sales had been poor, stocks would probably have risen anyway, because the poor numbers would indicate a Romney victory, which the market is said to love.

In either case, stocks win, even on a day when commodities were hit hard across the board, especially in the precious metals segment, as gold and silver were pounded lower right from the opening of trading.

That seems to be the game plan, at least for today, by the central bank stock market cartel controlling markets worldwide. Buy riskier assets and sell off those things that are proven to be a reliable store of value.

It's working, as stocks are within 5-8% of all time highs on the S&P and the Dow. It's a very interesting time for both political junkies and market watchers, but should get even more intense during the week and after options expiry on Friday. There's still unfinished business in Europe, mostly regarding Greece and Spain, and a shock from the land of the socialists could easily upset any balancing act currently taking place in the markets.

Most of the attention is focused on Tuesday night's presidential debate, the current wisdom saying that another poor performance by president Obama would practically hand the election over to Mitt Romney, the Republican challenger, making the event must-see TV for all, despite the thinly-veiled sarcasm in that statement.

The debates are largely political porn, with many voters having already made up their minds. If Obama purposely throws Tuesday's debate, as he did the first one, it would give Romney an edge, so, considering how the media whores need to keep the American public on the edge of their seats right up until - and beyond - election day, count on the President to deliver some serious body blows Tuesday night, followed by a negative market reaction Wednesday.

With the election just three weeks away, expect the rhetoric and noise to rise to a crescendo in coming weeks. Along with it could be a climactic rise in stocks, with the Dow touching off new all-time highs and the S&P hot on its heels, or, a dramatic turndown heading into the big fiasco that is election day in America.

Dow 13,424.23, +95.38 (0.72%)
NASDAQ 3,064.18, +20.07 (0.66%)
S&P 500 1,440.13, +11.54 (0.81%)
NYSE Composite 8,296.97, +69.89 (0.85%)
NASDAQ Volume 1,536,536,250
NYSE Volume 3,257,196,000
Combined NYSE & NASDAQ Advance - Decline: 3596-1897
Combined NYSE & NASDAQ New highs - New lows: 133-65
WTI crude oil: 91.85, -0.01
Gold: 1,737.60, -22.10
Silver: 32.74, -0.926