The highly-anticipated December Non-farms payroll report, issued by the Commerce Department prior to the opening bell, didn't have much of an effect on the overall tone of trading in the final day of the first week of 2010. The report showed a loss of 85,000 jobs for the month, far worse than expected, but traders seemed unmoved and the major indices, while trending lower most of the session, still managed to post small gains, primarily due to the weaker dollar.
As has been the case for the past 10 months, stocks just keep going up, no matter the news. Analysts and professionals seem to be able to twist any data into positive signs of recovery, just the kind of attitude tha leads to bubble-like markets, over-bought conditions and stock which have multiples that are based more on fiction than the reality of fundamental analysis.
Using the stock indices as yardsticks, one would believe that we're 60% better than we were a year ago. At the very least, that stocks are worth 60% more, or will be. One can only imagine the short positions being taken up by the truly savvy players in anticipation of what are likely to be shaky 4th quarter reports from a slew of companies over the next two to three weeks.
It should be a spectacle worth witnessing.
Dow 10,618.19, +11.33 (0.11%)
NASDAQ 2,317.17, +17.12 (0.74%)
S&P 500 1,144.98, +3.29 (0.29%)
NYSE Composite 7,425.35, +31.42 (0.42%)
Advancing issues led decliners, 4059-2409, the margin building through the week to its best level on Friday. New highs were achieved by 697 stocks, with only 80 making new lows. Volume moderated a bit from the previous two sessions, but remained solid. Those chasing performance may have taken a wait-and-see approach and an early exit for the weekend.
NYSE Volume 4,872,173,500
NASDAQ Volume 2,163,779,500
The commodity markets lollygagged through the day. Crude oil gained all of 9 cents, to $82.75 per barrel. With the weaker dollar underpinning trades, gold rose $5.50, to $1,139.20. Silver continued its ascent, gaining 12 cents, to $18.46. The speculation in natural gas seems to have gone to its limit, near term, with that commodity losing 5 cents, to $5.71/mmbtu.
For the week, stocks trended higher, though Friday's finish was suspect, with almost all of the action commencing in a frantic final half hour. Most of the progress for the week was made on Monday, when traders kicked off 2010 with the best gains.
Alcoa kicks off earnings season on Monday, though one company's results are unlikely to move markets dramatically.
Friday, January 8, 2010
Thursday, January 7, 2010
Payrolls on the Mind
Stocks traded sideways most of the session, though the NASDAQ spent the entire day in negative territory, finishing lower y a point. Once again, there was little to no motivation to buy stocks, though the majors all posted gains. Investors are still awaiting Friday's non-farm payroll data.
Initial unemployment claims came in 484,000, which was one thousand more than last week, so there's no movement in that department. Jobs may be more scarce in some areas and for different ethnic and age strata, but there's no lack of money anywhere. Cash, currencies and currency equivalents are circulating at a steady pace, thanks to government stimulus efforts, but mostly to easy interest rates. That's why there is so much worry over rates and when the Fed decides to start raising them, because once they begin, they usually don't stop until they're around 5% on a 10-year note, or higher, depending on how much pent-up demand surfaces in real spending.
Dow 10,606.86, +33.18 (0.31%)
Nasdaq 2,300.05, -1.04 (0.05%)
S&P 500 1,141.69, +4.55 (0.40%)
NYSE Composite 7,393.93, +16.23 (0.22%)
Advancing issues finished far ahead of decliners, 3864-2684, and new highs beat new lows, 584-68. Volume was again on on the high side of moderate. From the volume today and the preceding two, it's become apparent that some strong positions are being filled. Tomorrow's employment number may have almost no net effect on stocks at this level, unless, of course, it's a disappointing one.
NYSE Volume 5,869,563,500
Nasdaq Volume 2,302,742,000
Commodities took a breather from their breakneck gains, except for silver, which continues to be on fire. Copper prices have also been on the rise, though lower today. Oil was off 52 cents, to $82.66. Gold lost $2.90, to $1,133.60. The aforementioned silver: up 18 cents, to $18.35. Silver is close to 18-month highs, though considering the 2009 move in gold, has some catching up to do.
Tomorrow, the wait is over. The government can announce a loss of 45,000 or so jobs and we'll go back to work, or sleep. The market has been very quiet of late, which may be the best thing that could happen.
Initial unemployment claims came in 484,000, which was one thousand more than last week, so there's no movement in that department. Jobs may be more scarce in some areas and for different ethnic and age strata, but there's no lack of money anywhere. Cash, currencies and currency equivalents are circulating at a steady pace, thanks to government stimulus efforts, but mostly to easy interest rates. That's why there is so much worry over rates and when the Fed decides to start raising them, because once they begin, they usually don't stop until they're around 5% on a 10-year note, or higher, depending on how much pent-up demand surfaces in real spending.
Dow 10,606.86, +33.18 (0.31%)
Nasdaq 2,300.05, -1.04 (0.05%)
S&P 500 1,141.69, +4.55 (0.40%)
NYSE Composite 7,393.93, +16.23 (0.22%)
Advancing issues finished far ahead of decliners, 3864-2684, and new highs beat new lows, 584-68. Volume was again on on the high side of moderate. From the volume today and the preceding two, it's become apparent that some strong positions are being filled. Tomorrow's employment number may have almost no net effect on stocks at this level, unless, of course, it's a disappointing one.
NYSE Volume 5,869,563,500
Nasdaq Volume 2,302,742,000
Commodities took a breather from their breakneck gains, except for silver, which continues to be on fire. Copper prices have also been on the rise, though lower today. Oil was off 52 cents, to $82.66. Gold lost $2.90, to $1,133.60. The aforementioned silver: up 18 cents, to $18.35. Silver is close to 18-month highs, though considering the 2009 move in gold, has some catching up to do.
Tomorrow, the wait is over. The government can announce a loss of 45,000 or so jobs and we'll go back to work, or sleep. The market has been very quiet of late, which may be the best thing that could happen.
Wednesday, January 6, 2010
Investors Awaiting Friday Jobs Data; Markets Churn
Another day passed on Wall Street with little or no movement in the major indices. Topping the outlook was anticipation of December Non-farm Payroll data, due out Friday morning, January 8, prior to the opening bell. A glimpse of what the numbers may look like was provided by the monthly private payroll report by ADP, which showed employers shedding another 84,000 jobs during December, a figure much improved over November's -145,000.
Considering that November Non-farm payrolls came in at the best levels in 16 months, showing a loss of only 11,000 jobs, the ADP report should have been reassuring to anyone looking for a better employment picture on Friday. Expectations are that the government will show a loss of between 25,000 and 45,000 jobs, though estimates are ranging even into positive territory. Much depends on prior month revisions, and also the method by which the december figures are compiled.
Some private sources contend that the government figures are fudged for political purposes, which would not be beyond imagination, while others point out that the raw numbers do not include the hordes of workers who have exhausted unemployment benefits and are no longer counted. True unemployment, including distressed workers, is estimated to be closer to 18% than the 10% with which the government has been flirting.
In any case, traders seemed tenuous with stocks trading in narrow ranges for the second straight day. While the NASDAQ finished in the red, the other major indices all posted positive numbers, though their gains were marginal, at best.
Dow 10,573.68, +1.66 (0.02%)
Nasdaq 2,301.09, -7.62 (0.33%)
S&P 500 1,137.14, +0.62 (0.05%)
NYSE Composite 7,377.70, +22.83 (0.31%)
Gainers edged out losers on the day, by roughly the same margin as Tuesday, 3548-2965. Once more, new highs seemed to be topping out, with 798 stocks reaching 52-week highs, while only 73 made new lows. Volume was solid again, though considering how little movement there was, churning was the operative word to describe the session. People are still waiting for unemployment data and further out, earnings reports.
NYSE Volume 5,517,178,000
Nasdaq Volume 2,269,902,500
Commodity prices were sharply higher, as oil reached another 15-month peak, gaining $1.41, to $83.18 per barrel. Gold soared another $18.30, to $1,137.00, while silver bounded ahead another 38 cents, to $18.18.
The signal coming from commodity traders is that of recovery and inflation, though equity participants are being cautious on the same news, figuring that those two economic elements will force the Fed to raise rates sooner, rather than later. The widespread consensus is that any rate hikes before June will kill off the rally, now in it's 10th month.
Considering that November Non-farm payrolls came in at the best levels in 16 months, showing a loss of only 11,000 jobs, the ADP report should have been reassuring to anyone looking for a better employment picture on Friday. Expectations are that the government will show a loss of between 25,000 and 45,000 jobs, though estimates are ranging even into positive territory. Much depends on prior month revisions, and also the method by which the december figures are compiled.
Some private sources contend that the government figures are fudged for political purposes, which would not be beyond imagination, while others point out that the raw numbers do not include the hordes of workers who have exhausted unemployment benefits and are no longer counted. True unemployment, including distressed workers, is estimated to be closer to 18% than the 10% with which the government has been flirting.
In any case, traders seemed tenuous with stocks trading in narrow ranges for the second straight day. While the NASDAQ finished in the red, the other major indices all posted positive numbers, though their gains were marginal, at best.
Dow 10,573.68, +1.66 (0.02%)
Nasdaq 2,301.09, -7.62 (0.33%)
S&P 500 1,137.14, +0.62 (0.05%)
NYSE Composite 7,377.70, +22.83 (0.31%)
Gainers edged out losers on the day, by roughly the same margin as Tuesday, 3548-2965. Once more, new highs seemed to be topping out, with 798 stocks reaching 52-week highs, while only 73 made new lows. Volume was solid again, though considering how little movement there was, churning was the operative word to describe the session. People are still waiting for unemployment data and further out, earnings reports.
NYSE Volume 5,517,178,000
Nasdaq Volume 2,269,902,500
Commodity prices were sharply higher, as oil reached another 15-month peak, gaining $1.41, to $83.18 per barrel. Gold soared another $18.30, to $1,137.00, while silver bounded ahead another 38 cents, to $18.18.
The signal coming from commodity traders is that of recovery and inflation, though equity participants are being cautious on the same news, figuring that those two economic elements will force the Fed to raise rates sooner, rather than later. The widespread consensus is that any rate hikes before June will kill off the rally, now in it's 10th month.
Tuesday, January 5, 2010
Factory Orders Up; Pending Hone Sales Down
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.
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.
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...
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