The headline explains quite a bit. The manufacturing sector continues to churn, though at unimpressive levels, and the housing market continues to slump. Factory orders were up 1.1% in November, after posting a gain of 0.8% in October. Pending hone sales were down 16% in November, as compared to October. While that may be seen as the result of the expiring of the new buyer tax credit, that excuse has begun to wear thin. Foreclosures are still at or near record highs, and, with unemployment hovering around 10%, aren't expected to drop off any time soon.
The housing market in the United states is still a shambles and any efforts to revive it, other than plain, ordinary waiting it out, are likely to fail. There are more than enough residential properties on the market for the scarce number of available buyers. Simple supply and demand math are all one needs to know about real estate from now until 2012. If you're thinking of buying, offer less, or buy something reasonable, to live in, not as an investment.
Stocks zig-zagged all day with the Dow remaining underwater for the entire session. The range was very narrow as investors showed a bit of caution after yesterday's blow-off, start-of-the-year rally. Stocks don't appear to be cheap anymore, and some of them don't look like solid investments, either. Cash remains king and when put to its proper use, can produce solid assets. In the current low-inflation (some dare call it deflation) environment, actual money is a rather useful, fluid thing, and Americans are finding out that there are bargains both to be had and sold. It's a good time to be frugal, or so it seems, and that would imply that it's not a good time to be in stocks, which are, by their nature, speculative.
Dow 10,572.02, -11.94 (0.11%)
Nasdaq 2,308.71. +0.29 (0.01%)
S&P 500 1,136.52. +3.53 (0.31%)
NYSE Composite 7,354.87, +28.13 (0.38%)
Interestingly enough, today's market moves were broad-based and on solid volume. Advancers outnumbered decliners, 3575-2976, wit the bulk of the gains on the NYSE. New highs appear to be peaking, at 754 today, as compared to 76 new lows.
NYSE Volume 5,687,644,500
Nasdaq Volume 2,395,510,250
Commodities were almost universally higher, with the notable exception of natural gas (somebody must have taken my post from yesterday to heart), down 25 cents. Oil priced at a 15-month high for the second straight day, reaching $81.77 on a gain of 26 cents. Gold continued to rebound, though up just 20 cents, to $1,118.50. Silver was the big winner on the day, gaining 34 cents to reach $17.80.
Stock remain in a very measured upward range, and while many commentators are expecting the rally to run out of steam (self included), it hasn't happened yet. The next likely move should occur during the hullabaloo over earnings, which will commence earnestly next week. Those not wishing to wait for Alcoa (AA) to officially kick off earnings season on Monday might get a clue from Monsanto (MON), which reports tomorrow.
Tuesday, January 5, 2010
Monday, January 4, 2010
Galloping Out of the Gate, Stocks Make New Highs
Investors were eager to put their money into equities on the first trading day of the new year, though the overall gains were compromised by two factors: first, the closing figures were only fractionally higher (on a percentage basis) than that of December 30 of last year, prior to the sell-off which occurred on the 31st; second, volume was moderate, on the low side, significant of marginal participation. There is still a ton of money (literally and figuratively) sitting out this rally. Something on the order of $4 Trillion is still nesting in money market funds, t-bills or other low-yielding assets.
Not everyone has bought into the story which Wall Street is currently spinning: that stocks are safe - and sound - investments upon which one can rest his or her fortunes. Quite simply, there were too many people burned in the Fall of 2008 through the Spring of 2009. Many smaller investors were wiped out, never to return. Others have trimmed their holdings and curtailed all but the most basic trading activity.
Lower volume levels, as compared to the go-go years of the mid-00 decade, have become the new normal, and rightfully so. Stocks, like it or not, generally do not go up 50-60% in the course of 9 months, as they did from march of '09 to the present. Anyone buying in at these levels is certainly chasing, and bound to be burned.
Even though earnings reports for the 4th quarter are due out within days, nobody is expecting miracles. Corporations have trimmed expenses to the bone, spurring profits over the past two or three quarters, but investors seek top-line growth, revenue improvements, higher margins and expansion. They're not going to get them in this current round of reports, at least not to the extent which analysts are proposing.
Unemployment and housing remain the two sticking points for the US economy. Labor markets remain the tightest in decades. Home prices are still dropping in many areas of the country as more foreclosures hit the market. Those trends see no ends, and until they are resolved - unemployment below 8% and housing prices averaging up by 2-3% per year - the recovery in the USA is going to be muted at best. Add to the woes the mess federal government has created with the continuation of tax-and-spend-and-borrow policies and you get a common recipe for stagnation.
Dow 10,583.96, +155.91 (1.50%)
Nasdaq 2,308.42, +39.27 (1.73%)
S&P 500 1,132.99, +17.89 (1.60%)
NYSE Composite 7,326.74, +141.78 (1.97%)
Advancing issues soared past decliners, 5271-1356. New highs outpaced new lows, 693-83, not surprising, and a trend that will continue due to easy comparable highs from last year. As stated at the outset, volume was sluggish, or, for lack of a better term, normal.
NYSE Volume 4,526,077,000
Nasdaq Volume 1,955,813,625
Everything else in the universe was higher on the day, including just about all commodities. Oil gained a ridiculous $2.15, closing at $81.51, it's highest price in over a month. Gold rallied an astonishing $23.30, reaching $1,119.50. Silver soared by 60 cents, to $17.45.
Possibly the most absurd trade of the day, if not the year, is in natural gas, a commodity over which the US sits a 100-year supply. The odorous stuff, which can fuel anything from entire energy plants to kiddie cars, was up a whopping 31 cents, to $5.84, it's highest price in well over a year. six months ago, natural gas was trading under $3.00 per mmbtu. Considering the extraordinary amount of proven supplies, the price should be stable, near its bottom. As usual, however, the energy moguls have captured the market and control the price as they see fit, and, like oil, yesterday's price always seems too low to them.
American consumers have been squeezed dry by escalating prices in three areas: energy, health care and taxation. The government runs one of those areas, and has its hands firmly in the pockets of the other two. If anything can bring this country's economy to its knees, it just so happens to be our very own, greedy, inept, monstrously overgrown federal government. They are strangling the middle class into third-world status.
And they'll continue to do it tomorrow and the next day and the next...
Not everyone has bought into the story which Wall Street is currently spinning: that stocks are safe - and sound - investments upon which one can rest his or her fortunes. Quite simply, there were too many people burned in the Fall of 2008 through the Spring of 2009. Many smaller investors were wiped out, never to return. Others have trimmed their holdings and curtailed all but the most basic trading activity.
Lower volume levels, as compared to the go-go years of the mid-00 decade, have become the new normal, and rightfully so. Stocks, like it or not, generally do not go up 50-60% in the course of 9 months, as they did from march of '09 to the present. Anyone buying in at these levels is certainly chasing, and bound to be burned.
Even though earnings reports for the 4th quarter are due out within days, nobody is expecting miracles. Corporations have trimmed expenses to the bone, spurring profits over the past two or three quarters, but investors seek top-line growth, revenue improvements, higher margins and expansion. They're not going to get them in this current round of reports, at least not to the extent which analysts are proposing.
Unemployment and housing remain the two sticking points for the US economy. Labor markets remain the tightest in decades. Home prices are still dropping in many areas of the country as more foreclosures hit the market. Those trends see no ends, and until they are resolved - unemployment below 8% and housing prices averaging up by 2-3% per year - the recovery in the USA is going to be muted at best. Add to the woes the mess federal government has created with the continuation of tax-and-spend-and-borrow policies and you get a common recipe for stagnation.
Dow 10,583.96, +155.91 (1.50%)
Nasdaq 2,308.42, +39.27 (1.73%)
S&P 500 1,132.99, +17.89 (1.60%)
NYSE Composite 7,326.74, +141.78 (1.97%)
Advancing issues soared past decliners, 5271-1356. New highs outpaced new lows, 693-83, not surprising, and a trend that will continue due to easy comparable highs from last year. As stated at the outset, volume was sluggish, or, for lack of a better term, normal.
NYSE Volume 4,526,077,000
Nasdaq Volume 1,955,813,625
Everything else in the universe was higher on the day, including just about all commodities. Oil gained a ridiculous $2.15, closing at $81.51, it's highest price in over a month. Gold rallied an astonishing $23.30, reaching $1,119.50. Silver soared by 60 cents, to $17.45.
Possibly the most absurd trade of the day, if not the year, is in natural gas, a commodity over which the US sits a 100-year supply. The odorous stuff, which can fuel anything from entire energy plants to kiddie cars, was up a whopping 31 cents, to $5.84, it's highest price in well over a year. six months ago, natural gas was trading under $3.00 per mmbtu. Considering the extraordinary amount of proven supplies, the price should be stable, near its bottom. As usual, however, the energy moguls have captured the market and control the price as they see fit, and, like oil, yesterday's price always seems too low to them.
American consumers have been squeezed dry by escalating prices in three areas: energy, health care and taxation. The government runs one of those areas, and has its hands firmly in the pockets of the other two. If anything can bring this country's economy to its knees, it just so happens to be our very own, greedy, inept, monstrously overgrown federal government. They are strangling the middle class into third-world status.
And they'll continue to do it tomorrow and the next day and the next...
Thursday, December 31, 2009
Bummer! Stocks Flushed on Final 2009 Day of Trading
There was a correction coming; we all knew that. Nobody apparently was aware that it was going to begin on the last day of trading for 2009, but that's exactly what happened. Call it tax-related or year-end jitters, any way you slice it, stocks took a real nosedive on December 31, wiping out all of the week's gains and more. In the Dow's case, just about all of December was swished away in one final day, leaving that index up a paltry 83 points for the month. The results for the S&P were better, as the 500 index ended December with a gain of about 20 points, though it still can't seem to shake loose from the 1100-1125 level.
Best of all was the NASDAQ, which ended the final month of the year 125 points to the positive, or about a 5% gain. That was the best news of the day, and the NASDAQ the best-performing index of not just the month, but the entire year.
Dow 10,428.05, -120.46 (1.14%)
NASDAQ 2,269.15, -22.13 (0.97%)
S&P 500 1,115.10, -11.32 (1.00%)
NYSE Composite 7,184.96, -56.28 (0.78%)
As one might conclude from the final figures, advancers trailed decliners on the day, 4171-2375, a pretty wide gap. New highs numbered 322, with 49 equities posting new lows. Volume was as utterly pathetic as it has been all week, the low velocity of trading potentially causing the losses to appear exaggerated.. or not, depending on your perspective. Surely, stocks have had a wonderful year, but ending this way just gives one pause. Are we really out of the woods, or are the players and movers and shakers who brought us disaster in 2008, giving us reason to believe that 2009 was a mirage and 2010 might not be as positive as some expect. We'll have to wait until Monday, January 4, for our first glint of what the new year may bring.
NYSE Volume 2,547,756,250
NASDAQ Volume 1,254,659,250
Commodity prices bounced around a bit, but ended mostly flat. Oil was up just 8 cents, to $79.36, while gold gained $4.00, to $1,096.50, and silver added 2 cents, to $16.82.
With 2009 now officially in the books, we wish all of you a Happy and Prosperous New Year!
Best of all was the NASDAQ, which ended the final month of the year 125 points to the positive, or about a 5% gain. That was the best news of the day, and the NASDAQ the best-performing index of not just the month, but the entire year.
Dow 10,428.05, -120.46 (1.14%)
NASDAQ 2,269.15, -22.13 (0.97%)
S&P 500 1,115.10, -11.32 (1.00%)
NYSE Composite 7,184.96, -56.28 (0.78%)
As one might conclude from the final figures, advancers trailed decliners on the day, 4171-2375, a pretty wide gap. New highs numbered 322, with 49 equities posting new lows. Volume was as utterly pathetic as it has been all week, the low velocity of trading potentially causing the losses to appear exaggerated.. or not, depending on your perspective. Surely, stocks have had a wonderful year, but ending this way just gives one pause. Are we really out of the woods, or are the players and movers and shakers who brought us disaster in 2008, giving us reason to believe that 2009 was a mirage and 2010 might not be as positive as some expect. We'll have to wait until Monday, January 4, for our first glint of what the new year may bring.
NYSE Volume 2,547,756,250
NASDAQ Volume 1,254,659,250
Commodity prices bounced around a bit, but ended mostly flat. Oil was up just 8 cents, to $79.36, while gold gained $4.00, to $1,096.50, and silver added 2 cents, to $16.82.
With 2009 now officially in the books, we wish all of you a Happy and Prosperous New Year!
Wednesday, December 30, 2009
For a Wednesday, It Sure Felt Like a Friday
The financial markets have slowed to a complete crawl as the week winds toward the end of the year, the decade, oblivion. The end of oblivion may be where the market is headed, but one would be hard-pressed to find that place.
Wednesday on Wall Street was more like a Friday. The place was empty, which brings up an interesting thought: what if you wanted to sell your stocks and there were no buyers? It could happen, especially if the US economy does the double-dip so many believe it will. In that case, you'll be stuck with your stock certificates, or, barring that, the memory of same.
Stocks are just pieces of paper, we should constantly remind ourselves, and worse than that, in today's economy, they are nothing more than protons and electrons traveling around an electrically-charged financial universe. They, as strictly a function of perception and perceived risk, may be worth what the next person is willing to pay. If that amount is less than what you paid, you lose. If more, you win. If nobody cares, you lose. In two out of three of those circumstances you lose and in one (a 33% chance), you lose everything you invested.
Is that any way to construct a plan for financial stability or prosperity? Probably not, though we, as humans, are prone to accepting and believing in whatever horsecrap suits our mind-set best, and for the majority, it's stocks. No, not gold, or even silver, or trinkets, dishwashers, sofas or houses, but little pieces of paper or whirring sub-atomic material which shows up in our online accounts as a series of numbers with symbols, periods and commas attached.
That is which that we have placed our faith. Good luck to us all.
Dow 10,548.51, +3.10 (0.03%)
NASDAQ 2,291.28, +2.88 (0.13%)
S&P 500 1,126.42, +0.23 (0.02%)
NYSE Composite 7,241.24, -10.95 (0.15%)
For the third straight session, declining issues held sway over advancing ones, 3376-3089. New highs, there were 257. There were 46 new lows. Volume was so light that many considered just leaving at lunch time, and many did. The whole she-bang seems to be grinding to a halt with one more day remaining to trade in 2009.
NYSE Volume 2,685,528,000
NASDAQ Volume 1,314,963,375
The Chicago Purchasing Managers Index, which came in at 60.0, topped expectations, hitting its best level since 2006.
Commodity markets were equally dull. Oil gained 13 cents, to $79.00. Gold lost $6.10, to end at $1,092.00. Silver fell 33 cents, to $16.79. Two weeks ago, silver was over $18.00. Now, this? Something is definitely wrong with precious metals and that could bode ill for everyone.
Last day of the year is tomorrow. Let's hope we all wake up on the other side.
Wednesday on Wall Street was more like a Friday. The place was empty, which brings up an interesting thought: what if you wanted to sell your stocks and there were no buyers? It could happen, especially if the US economy does the double-dip so many believe it will. In that case, you'll be stuck with your stock certificates, or, barring that, the memory of same.
Stocks are just pieces of paper, we should constantly remind ourselves, and worse than that, in today's economy, they are nothing more than protons and electrons traveling around an electrically-charged financial universe. They, as strictly a function of perception and perceived risk, may be worth what the next person is willing to pay. If that amount is less than what you paid, you lose. If more, you win. If nobody cares, you lose. In two out of three of those circumstances you lose and in one (a 33% chance), you lose everything you invested.
Is that any way to construct a plan for financial stability or prosperity? Probably not, though we, as humans, are prone to accepting and believing in whatever horsecrap suits our mind-set best, and for the majority, it's stocks. No, not gold, or even silver, or trinkets, dishwashers, sofas or houses, but little pieces of paper or whirring sub-atomic material which shows up in our online accounts as a series of numbers with symbols, periods and commas attached.
That is which that we have placed our faith. Good luck to us all.
Dow 10,548.51, +3.10 (0.03%)
NASDAQ 2,291.28, +2.88 (0.13%)
S&P 500 1,126.42, +0.23 (0.02%)
NYSE Composite 7,241.24, -10.95 (0.15%)
For the third straight session, declining issues held sway over advancing ones, 3376-3089. New highs, there were 257. There were 46 new lows. Volume was so light that many considered just leaving at lunch time, and many did. The whole she-bang seems to be grinding to a halt with one more day remaining to trade in 2009.
NYSE Volume 2,685,528,000
NASDAQ Volume 1,314,963,375
The Chicago Purchasing Managers Index, which came in at 60.0, topped expectations, hitting its best level since 2006.
Commodity markets were equally dull. Oil gained 13 cents, to $79.00. Gold lost $6.10, to end at $1,092.00. Silver fell 33 cents, to $16.79. Two weeks ago, silver was over $18.00. Now, this? Something is definitely wrong with precious metals and that could bode ill for everyone.
Last day of the year is tomorrow. Let's hope we all wake up on the other side.
Tuesday, December 29, 2009
Weary Santa Rally Stumbles; Stocks End Six-Day Streak
Just a day after vaulting to new multi-month and 52-week highs, the major averages took a breather with just two days remaining to trade in 2009. In what has been a banner year for stocks - at least over the final three quarters - there's little doubt that stocks are in need of a little sideways trade, likely until the beginning of earnings releases which begin in about two weeks.
Just like old St. Nick must be tuckered out after a long journey, so too with stocks in general. Many equities are at or near their highs and investors are taking a wait-and-see attitude. Life for traders and investors should return to a more normal environment once the calendar flips.
There was a little bit of economic news on this very sluggish holiday week, though the data was hardly significant. The S&P/Case-Shiller Home Price Index [PDF] for October showed home prices increasing for the seventh straight month, though the rate of improvement was slowing slightly and not all areas of the country experienced gains. David M. Blitzer, Chairman of the Index Committee at Standard & Poor’s, described the report as "flat."
The Conference Board's Consumer Confidence Index jumped from 50.6 to 52.9, with the rise attributed to improving perceptions of the labor market. The number is still far below the benchmark of 90, considered to depict a "strong" economy.
Markets mostly shrugged off any data, and, with Wall Street sparsely populated once again, much of the activity was confined to squaring up or adding to positions before the year's end. Day traders were active, though overall volume was dismal for the second straight session. Overall volume was lower than Monday's, a sure sign that the incipient rally has run out of steam for the year, but could resume once volume returns to more reasonable levels.
Dow 10,545.41, -1.67 (0.02%)
NASDAQ 2,288.40, -2.68 (0.12%)
S&P 500 1,126.19, -1.59 (0.14%)
NYSE Composite 7,252.19, -9.05 (0.12%)
Decliners outperformed advancing issues for the second straight session, though by the narrowest of margins, 3220-3210. Both new highs (412) and new lows (59) returned lower numbers than on Monday.
NYSE Volume 2,808,519,250
NASDAQ Volume 1,191,436,875
The dollar was stronger against foreign currencies, with the Dollar Index trading in a range right around a key support/resistance area just below 78. The greenback is well off the lows of two months ago, which were in the low 74 range.
Oil managed a gain of just 10 cents, to $78.87. Gold, which generally trades in the opposite direction of the dollar, did so, losing $9.80, to $1,098.10. Silver also fell, down 46 cents, to $17.10.
With just two trading days left in 2009, it would neither be surprising nor upsetting if stocks took a slight haircut into the end of the year of about 1-1.5%. In fact, such a move on low volume might actually be a sign of health, signifying that investors remain cautious, though optimistic about prospects for 2010.
Just like old St. Nick must be tuckered out after a long journey, so too with stocks in general. Many equities are at or near their highs and investors are taking a wait-and-see attitude. Life for traders and investors should return to a more normal environment once the calendar flips.
There was a little bit of economic news on this very sluggish holiday week, though the data was hardly significant. The S&P/Case-Shiller Home Price Index [PDF] for October showed home prices increasing for the seventh straight month, though the rate of improvement was slowing slightly and not all areas of the country experienced gains. David M. Blitzer, Chairman of the Index Committee at Standard & Poor’s, described the report as "flat."
The Conference Board's Consumer Confidence Index jumped from 50.6 to 52.9, with the rise attributed to improving perceptions of the labor market. The number is still far below the benchmark of 90, considered to depict a "strong" economy.
Markets mostly shrugged off any data, and, with Wall Street sparsely populated once again, much of the activity was confined to squaring up or adding to positions before the year's end. Day traders were active, though overall volume was dismal for the second straight session. Overall volume was lower than Monday's, a sure sign that the incipient rally has run out of steam for the year, but could resume once volume returns to more reasonable levels.
Dow 10,545.41, -1.67 (0.02%)
NASDAQ 2,288.40, -2.68 (0.12%)
S&P 500 1,126.19, -1.59 (0.14%)
NYSE Composite 7,252.19, -9.05 (0.12%)
Decliners outperformed advancing issues for the second straight session, though by the narrowest of margins, 3220-3210. Both new highs (412) and new lows (59) returned lower numbers than on Monday.
NYSE Volume 2,808,519,250
NASDAQ Volume 1,191,436,875
The dollar was stronger against foreign currencies, with the Dollar Index trading in a range right around a key support/resistance area just below 78. The greenback is well off the lows of two months ago, which were in the low 74 range.
Oil managed a gain of just 10 cents, to $78.87. Gold, which generally trades in the opposite direction of the dollar, did so, losing $9.80, to $1,098.10. Silver also fell, down 46 cents, to $17.10.
With just two trading days left in 2009, it would neither be surprising nor upsetting if stocks took a slight haircut into the end of the year of about 1-1.5%. In fact, such a move on low volume might actually be a sign of health, signifying that investors remain cautious, though optimistic about prospects for 2010.
Subscribe to:
Posts (Atom)
Posts
