After hearing all week long how the major Northeast snowstorms in February were going to impact the non-farm payroll number, the group that compiles the data, the Bureau of Labor Statistics, flatly denied that the snowstorms materially affected their data in any meaningful way. They even issued a small note at the end of their report clarifying the situation.
What this shows is how little so-called "experts" understand the mechanics of survey data, especially one so widely distributed and followed. Some of these now-disgraced pundits were calling for job losses in the range of 150-200,000. Once again, what passes for economic knowledge and analysis in the age of instant everything is little more than 3rd grade nonsense.
When the BLS did release their report at the appointed time of 8:30 am, they showed the US losing 36,000 jobs for the month of February. Immediately, broker's phones were ringing off their hooks with orders to buy, buy, buy, and that's how the day went, as the media-driven stock markets posted one of the best gains of the year, boosting all major indices well into positive territory for the year.
Even more amusing than the 36,000 job loss being hailed as a positive development was the wild revisionism throughout the media complex. Even sites such as Yahoo Finance and briefing.com changed their outlooks during the week, lowering expectations in advance of snow-related data. Expectations went from losses of 35,000 jobs on Monday all the way to -120,000 on Thursday and Friday. Supposedly, they may have appeared smarter had they just kept their predictions alone.
As the day wore on, the 36,000 decline in employment was being laughably hailed as another sign of recovery. The inverse is probably correct in this case, however. The numbers are going nowhere or actually in reverse. With January revised downward from 20,000 to 26,000 jobs eliminated, today's figure was just more of the same, only worse. But, as Wall Street and their media playfellows insist, any economic data is cause for a party, and party they did.
Dow 10,566.20, +122.06 (1.17%)
NASDAQ 2,326.35, +34.04 (1.48%)
S&P 500 1,138.69, +15.72 (1.40%)
NYSE Composite 7,291.06, +117.99 (1.64%)
Advancers beat back decliners by a healthy margin in a broad-based advance, 5315-1253. New highs punished new lows, 804-56, a margin of magnitude not seen since late summer. Volume, however, continues to lag. Participation in the market remains subdued, a troubling sign for the permanent bulls.
NYSE Volume 4,769,908,000
NASDAQ Volume 2,309,856,750
Commodities were split, though oil continued its amazing ascent, gaining $1.57 per barrel, to $81.78, its highest level in two months. Gold added $4.40, to $1,137.50. Silver was likewise ahead by 21 cents, to $17.39.
All indices were up for the week, putting the scorecard for weekly gains and losses at 4 up and 5 down.
How the markets manage to add to their recent gains is a very good question. Mostly, smoke and mirrors, rather than reasoned analysis will lend much of the punditry to express bullish sentiments on stocks and the economy in general. Apparently, all of the issues that were causing problems, like home foreclosures, unemployment, debt destruction, unfunded liabilities and growing government deficits are now being handled by the powers that be, the very same people who caused them in the first place.
Faith, usually reserved for deities, has now been transferred to the likes of Ben Bernanke, Barney Frank and Lloyd Blankfein. At least in Blankfein's case, he admits to doing "God's work," in his own words. The others are simply liars and/or hypocrites.
The faithful are being led somewhere, though the final destination is as yet unknown. I'll make a small wager that any move to the upside could be the beginning of the mother of all sucker rallies. Stocks appear to be if not at least fairly valued, over-valued. Recovery has been priced into every equity being traded, the perfect recipe for a bear attack. It may come at any time, or months from now, but the prospects for a full, robust recovery are still clouded by bailouts, Fed intervention, and a media with marching orders to sound the "all clear" alert.
Friday, March 5, 2010
Thursday, March 4, 2010
Stocks Surge on Slim News
Despite indications that Friday's non-farm payroll data is going to disappoint - or maybe because of that - stocks continued to trundle forward and have now put together the makings of a fairly nice week of gains.
All of the major indices are poised to post their third weekly gain in the last four and, as of today's close, all but the NYSE Composite are positive for the year.
Data which has been released this week has been mixed, though slightly positive overall. Initial unemployment claims dropped off by 29,000 in the most recent week, but are still stubbornly high at 469,000. A number closer to 300,000 would be indicative that layoffs have stopped and that re-hiring was about to resume, though market participants aren't holding their collective breaths in anticipation of that number. Factory orders showed an impressive 1.7% gain in January, following a solid 1.5% advance in December.
The canary in the coal mine, however, continued to be housing. Pending home sales fell 7.6% in January according to the National Association of Realtors (NAR), which, to almost nobody's surprise, was blamed on the weather, even though the worst storms of the season came in February, not January. Thus, any attempts to paint lipstick on the pig that is residential housing are likely to induce ridicule and groaning.
With the nation almost completely mortgaged to the government due to guarantees by Fannie Mae, Freddie Mac and the other alphabet soup names of agencies sopping up the upside-down mortgage market, there is little hope that the heartland of America's middle class is going to rebound any time soon. Jobs and housing continue to haunt the best efforts of government and financiers, like Freddie Kruger, who just seems to never go away for good.
While Wall Street can whoop it up over earnings and percentages, most of America is suffering, especially state governments. Roughly 4 out of 5 are going to need further assistance from the feds in closing gaping budget shortfalls this year, after being bailed out in 2009. Turning the sublime into the ridiculous, the federal government is about as bankrupt as most of Bernie Madoff's investors, so that, in effect, the states are borrowing borrowed money.
We have come to the point in our history that the obvious cannot be overlooked, though the media and government officials try their best to obfuscate the truth in hopes of retaining or gaining office. Adding together all of the debt - most of it piled on in recent years - and including the unfunded and underfunded mandates such as Medicare and Social Security, every American living today is in hock to the tune of about $430,000.
Any economist who tells you that the money will be paid back is simply a jack-ass lacking common sense. The incredible tax burden needed to hoist such a huge burden off the backs of American citizens would relegate today's and future wage-earners to a level usually reserved for indentured servants. Some make the case that due to the high tax burden already imposed, most Americans are nothing more than wage slaves already, a point that cannot be made too finely nor too bluntly.
While the mechanics of the economy whirr ever onward, the plight of the individual continues to deteriorate. Pay raises, once a commonplace theme in most business environments, have been all but obliterated since the late 1990s, except, of course, in government positions, where financial discipline has been abrogated and handed over to the debt-runners in congress and the presidency. The lower classes get welfare checks and other comforts from the largess of the Treasury; the upper class needs no such relief, having written all they need into the tax codes, leaving the vast middle class in a squeezed situation such as today's, where wages hardly cover the costs associated with common living.
Saving, that relic from the past that our parents and grandparents tried to imbue into us, has been replaced by debt, and that debt has exploded to unreasonable levels in just the past twenty years, threatening to destroy the entire fabric the social compact upon which our country was founded and currently operates.
Retirement, the biggest sham ever invented, is going to be thrust from the American lexicon within the next decade as baby-boom generation workers begin to add to the debt burden in increasing numbers. Taking away benefits from earners is still taboo in Washington, DC, though the decision to either cut benefits or raise taxes will soon be an unavoidable choice, probably within five to six years, if the union lasts that long.
The final insult to the idealist "peace and love" crowd from the 60s will be termination of Social Security for all intents and purposes. Benefits will still be doled out in some form or another, though the level of payments will be ludicrously low in comparison to what previous generations took out. Like all other social entitlement programs, Social Security and Medicare in particular are nothing more than vast Ponzi schemes, using current revenue to pay current beneficiaries. Within years, even possibly months, the balance will tip toward the recipients outnumbering the payers, sending the entire system further into default (It's already over the brink, though nobody will admit it).
What happens when the economy of a nation, brought down by debt burdens too weighty to maintain, implodes, is not a secret. The obvious first victims will be the lame and indigent, as government stipends are reduced or completely shut off. Next would be the chronically poor and illiterate, who do not possess enough brain power or initiative to fend for themselves.
The upper class will feel only slight pain, most of the anguish being sustained by the 60-70% of the population in the middle. Good jobs will be hard to come by, families will be forced to live together as in the Great Depression of the 1930s, and, though prices for everything from food to fuel will be forced lower (though that's arguable in the case of utilities and health care, which will raise prices on fewer customers to meet costs), few will be able to afford much more than basic necessities.
All of this is why it's important to know what your money is doing and where you are putting it to work. As explained recently, the only viable investments for the average middle class American today are cash, capital goods, and capital-producing goods such as food, fuel, seeds and tools of trade. All else is speculative and more than likely doomed. There are those who preach that gold will be the savior of assets and wealth, and that may be true, though most middle class people would more than likely have to sell any gold assets in order to meet day-to-day expenses in a post-crash economy.
In any case, there are trillions of dollars being fed into and out of the Wall Street stock machinery and today was a good day for them. Few of those who toil in the financial services industry have any idea of the train wreck that is just ahead, so, let their folly be your entertainment.
Dow 10,444.14, +47.38 (0.46%)
NASDAQ 2,292.31, +11.63 (0.51%)
S&P 500 1,122.97, +4.18 (0.37%)
NYSE Composite 7,173.07, +8.41 (0.12%)
Gainers outnumbered losers on the day, 3651-2790. There were 427 new highs to a paltry 27 new lows, as we approach the anniversary of the market bottom - March 9, 2009 - now just three trading days away.
NYSE Volume 4,448,901,500
NASDAQ Volume 2,062,605,875
Commodities took a bit of a breather. Oil was actually down 25 cents, to $80.62. Gold slipped $9.60, to $1,133.70, while silver fell 10 cents, to $17.23.
Tomorrow's release of non-farm payroll data for February probably won't cause much of a ruffle since expectations have been sufficiently dampened all week. It's a near certainty that the numbers will be worse than last month, and consequently blamed on the weather.
Markets and what passes for economic understanding have reached a new low, now that we can blame Mother Nature for our economic shortcomings.
All of the major indices are poised to post their third weekly gain in the last four and, as of today's close, all but the NYSE Composite are positive for the year.
Data which has been released this week has been mixed, though slightly positive overall. Initial unemployment claims dropped off by 29,000 in the most recent week, but are still stubbornly high at 469,000. A number closer to 300,000 would be indicative that layoffs have stopped and that re-hiring was about to resume, though market participants aren't holding their collective breaths in anticipation of that number. Factory orders showed an impressive 1.7% gain in January, following a solid 1.5% advance in December.
The canary in the coal mine, however, continued to be housing. Pending home sales fell 7.6% in January according to the National Association of Realtors (NAR), which, to almost nobody's surprise, was blamed on the weather, even though the worst storms of the season came in February, not January. Thus, any attempts to paint lipstick on the pig that is residential housing are likely to induce ridicule and groaning.
With the nation almost completely mortgaged to the government due to guarantees by Fannie Mae, Freddie Mac and the other alphabet soup names of agencies sopping up the upside-down mortgage market, there is little hope that the heartland of America's middle class is going to rebound any time soon. Jobs and housing continue to haunt the best efforts of government and financiers, like Freddie Kruger, who just seems to never go away for good.
While Wall Street can whoop it up over earnings and percentages, most of America is suffering, especially state governments. Roughly 4 out of 5 are going to need further assistance from the feds in closing gaping budget shortfalls this year, after being bailed out in 2009. Turning the sublime into the ridiculous, the federal government is about as bankrupt as most of Bernie Madoff's investors, so that, in effect, the states are borrowing borrowed money.
We have come to the point in our history that the obvious cannot be overlooked, though the media and government officials try their best to obfuscate the truth in hopes of retaining or gaining office. Adding together all of the debt - most of it piled on in recent years - and including the unfunded and underfunded mandates such as Medicare and Social Security, every American living today is in hock to the tune of about $430,000.
Any economist who tells you that the money will be paid back is simply a jack-ass lacking common sense. The incredible tax burden needed to hoist such a huge burden off the backs of American citizens would relegate today's and future wage-earners to a level usually reserved for indentured servants. Some make the case that due to the high tax burden already imposed, most Americans are nothing more than wage slaves already, a point that cannot be made too finely nor too bluntly.
While the mechanics of the economy whirr ever onward, the plight of the individual continues to deteriorate. Pay raises, once a commonplace theme in most business environments, have been all but obliterated since the late 1990s, except, of course, in government positions, where financial discipline has been abrogated and handed over to the debt-runners in congress and the presidency. The lower classes get welfare checks and other comforts from the largess of the Treasury; the upper class needs no such relief, having written all they need into the tax codes, leaving the vast middle class in a squeezed situation such as today's, where wages hardly cover the costs associated with common living.
Saving, that relic from the past that our parents and grandparents tried to imbue into us, has been replaced by debt, and that debt has exploded to unreasonable levels in just the past twenty years, threatening to destroy the entire fabric the social compact upon which our country was founded and currently operates.
Retirement, the biggest sham ever invented, is going to be thrust from the American lexicon within the next decade as baby-boom generation workers begin to add to the debt burden in increasing numbers. Taking away benefits from earners is still taboo in Washington, DC, though the decision to either cut benefits or raise taxes will soon be an unavoidable choice, probably within five to six years, if the union lasts that long.
The final insult to the idealist "peace and love" crowd from the 60s will be termination of Social Security for all intents and purposes. Benefits will still be doled out in some form or another, though the level of payments will be ludicrously low in comparison to what previous generations took out. Like all other social entitlement programs, Social Security and Medicare in particular are nothing more than vast Ponzi schemes, using current revenue to pay current beneficiaries. Within years, even possibly months, the balance will tip toward the recipients outnumbering the payers, sending the entire system further into default (It's already over the brink, though nobody will admit it).
What happens when the economy of a nation, brought down by debt burdens too weighty to maintain, implodes, is not a secret. The obvious first victims will be the lame and indigent, as government stipends are reduced or completely shut off. Next would be the chronically poor and illiterate, who do not possess enough brain power or initiative to fend for themselves.
The upper class will feel only slight pain, most of the anguish being sustained by the 60-70% of the population in the middle. Good jobs will be hard to come by, families will be forced to live together as in the Great Depression of the 1930s, and, though prices for everything from food to fuel will be forced lower (though that's arguable in the case of utilities and health care, which will raise prices on fewer customers to meet costs), few will be able to afford much more than basic necessities.
All of this is why it's important to know what your money is doing and where you are putting it to work. As explained recently, the only viable investments for the average middle class American today are cash, capital goods, and capital-producing goods such as food, fuel, seeds and tools of trade. All else is speculative and more than likely doomed. There are those who preach that gold will be the savior of assets and wealth, and that may be true, though most middle class people would more than likely have to sell any gold assets in order to meet day-to-day expenses in a post-crash economy.
In any case, there are trillions of dollars being fed into and out of the Wall Street stock machinery and today was a good day for them. Few of those who toil in the financial services industry have any idea of the train wreck that is just ahead, so, let their folly be your entertainment.
Dow 10,444.14, +47.38 (0.46%)
NASDAQ 2,292.31, +11.63 (0.51%)
S&P 500 1,122.97, +4.18 (0.37%)
NYSE Composite 7,173.07, +8.41 (0.12%)
Gainers outnumbered losers on the day, 3651-2790. There were 427 new highs to a paltry 27 new lows, as we approach the anniversary of the market bottom - March 9, 2009 - now just three trading days away.
NYSE Volume 4,448,901,500
NASDAQ Volume 2,062,605,875
Commodities took a bit of a breather. Oil was actually down 25 cents, to $80.62. Gold slipped $9.60, to $1,133.70, while silver fell 10 cents, to $17.23.
Tomorrow's release of non-farm payroll data for February probably won't cause much of a ruffle since expectations have been sufficiently dampened all week. It's a near certainty that the numbers will be worse than last month, and consequently blamed on the weather.
Markets and what passes for economic understanding have reached a new low, now that we can blame Mother Nature for our economic shortcomings.
Wednesday, March 3, 2010
Stocks Sucking Wind; Oil Futures Out of Control
The persistent pattern of sideways trade held sway one more day on Wall Street, despite the ADP private employment report offering a glimpse of Friday's government non-farm payroll data. The ADP report showed employers shedding 20,000 jobs in February, which was better than most analysts were seeking. Still, those numbers - and a rise in ISM service index from 50.5 to 53.0 from January to February - hardly moved the needle.
Naturally, there were a good share of both winners and losers, but the overall markets are about as stagnant as a Louisiana swamp. The problem is that these stocks represent real money, currently not working very hard for anybody.
Dow 10,396.76, -9.22 (0.09%)
NASDAQ 2,280.68, -0.11 (0.00%)
S&P 500 1,118.79, +0.48 (0.04%)
NYSE Composite 7,164.66, +28.69 (0.40%)
Advancing issues beat back decliners once again, 3575-2890, though the margin was not nearly as large as in recent days. New highs led new lows, 555-45. Volume was led by the NASDAQ. The NYSE continues to exhibit signs of flagging interest with low volume a daily occurrence.
NYSE Volume 4,475,734,000
NASDAQ Volume 2,474,973,500
Meanwhile, commodities, especially those in the energy sector, were spinning out of control. Oil shot up another $1.27, to $80.95, with April wholesale gas futures at multi-month highs of $2.25/gallon. Gold gained $6.60, to $1,144.00. Silver was up 25 cents, to $17.31.
The outlook for the February non-farm payroll data due out Friday morning continues to be clouded by forecasts that snow storms during the month may have skewed the data significantly. Also in play is the hiring of workers for the 2010 census. That was supposed to boost employment significantly over 2nd and 3rd quarters of the year, though the effect probably won't be felt until the march data is released a month from now.
Naturally, there were a good share of both winners and losers, but the overall markets are about as stagnant as a Louisiana swamp. The problem is that these stocks represent real money, currently not working very hard for anybody.
Dow 10,396.76, -9.22 (0.09%)
NASDAQ 2,280.68, -0.11 (0.00%)
S&P 500 1,118.79, +0.48 (0.04%)
NYSE Composite 7,164.66, +28.69 (0.40%)
Advancing issues beat back decliners once again, 3575-2890, though the margin was not nearly as large as in recent days. New highs led new lows, 555-45. Volume was led by the NASDAQ. The NYSE continues to exhibit signs of flagging interest with low volume a daily occurrence.
NYSE Volume 4,475,734,000
NASDAQ Volume 2,474,973,500
Meanwhile, commodities, especially those in the energy sector, were spinning out of control. Oil shot up another $1.27, to $80.95, with April wholesale gas futures at multi-month highs of $2.25/gallon. Gold gained $6.60, to $1,144.00. Silver was up 25 cents, to $17.31.
The outlook for the February non-farm payroll data due out Friday morning continues to be clouded by forecasts that snow storms during the month may have skewed the data significantly. Also in play is the hiring of workers for the 2010 census. That was supposed to boost employment significantly over 2nd and 3rd quarters of the year, though the effect probably won't be felt until the march data is released a month from now.
Tuesday, March 2, 2010
Stuck In Neutral
By tomorrow morning's opening bell, there will be some sense of direction, and that sense is likely - based on observations from market sources - to be lower. The reason stocks may not be such good buys as of tomorrow morning is fear that Friday's non-farm payroll data for February will disappoint, and that tomorrow morning's 8:30 am ET release of ADP's private payroll figure will offer a sneak preview.
The Obama administration, rather than actually trying to mend the broken employment conditions in the US, has been resorting lately to downplaying expectations, which can only mean that Friday's numbers will be somewhere below estimates of the economy shedding 20-45,000 jobs. Some have actually suggested that the figure could fall into a range of 175-200,000 more job losses, of which the Obamanites will claim had much to do with recent snowstorms that plagued the Northeast through the month.
Well, if there's anything politicians can do well, it's disappoint, and blame it on the weather. Snowstorms, hurricanes, droughts, windy conditions do not affect a stable employment picture, and what we've got is an unstable one. Add to that the utter incompetence at the top - not only the administration, but congress as well, and there's a sure recipe for disaster.
In the meantime, investors and traders marked time in anticipation of the results. Wednesday's warm-up with the ADP report will surely shed some light; how much is unknown, though the gauge, issued at the beginning of each month two days prior to the government data, has proven highly reliable in its short life (less than a year).
Dow 10,405.98, +2.19 (0.02%)
NASDAQ 2,280.79, +7.22 (0.32%)
S&P 500 1,118.31, +2.60 (0.23%)
NYSE Compos 7,135.97, +35.22 (0.50%)
Making the tiny headline numbers appear understated, gainers outpaced losers on the day by a good spread, 4477-2023, better than 2:1. The number of new highs was once again elevated, at 624; there were only 48 new lows. Those number will change dramatically by the end of the month, more than likely in favor of new lows. Volume on the session was very strong on the NASDAQ, not so good on the NYSE.
NYSE Volume 4,788,700,000
NASDAQ Volume 2,683,460,000
Commodities are once again acting like demand is robust, though the current price regime is more about trading, seasonality and short-term profits rather than real supply-demand metrics. Oil was up $1.02, to $79.72. Gold gained $19.00, to $1,137.30, while silver shot up 59 cents, to $17.06. While pricing in the energy complex can be chalked up to seasonal conditions (doesn't fuel always go up when people drive more in the Spring?), the metals are retracing their gains from last year in a technical move that probably will end up pushing against new highs. At some point, gold investors will realize that their precious metal is in just another bubble, created by speculators and quick-buck artists. After rising for nine straight years, gold's price is reflective of two things: greed, and widespread distrust of current monetary and fiscal policies of countries using fiat currencies.
If the detractors of floating exchange rates, the Euro experiment and gobs of debt around the world are correct, the precious metals will be even more so in months and years ahead. The wild card in their calculations, however, is global deflation, which would undermine almost any asset, including gold, silver and platinum. Time will tell.
The Obama administration, rather than actually trying to mend the broken employment conditions in the US, has been resorting lately to downplaying expectations, which can only mean that Friday's numbers will be somewhere below estimates of the economy shedding 20-45,000 jobs. Some have actually suggested that the figure could fall into a range of 175-200,000 more job losses, of which the Obamanites will claim had much to do with recent snowstorms that plagued the Northeast through the month.
Well, if there's anything politicians can do well, it's disappoint, and blame it on the weather. Snowstorms, hurricanes, droughts, windy conditions do not affect a stable employment picture, and what we've got is an unstable one. Add to that the utter incompetence at the top - not only the administration, but congress as well, and there's a sure recipe for disaster.
In the meantime, investors and traders marked time in anticipation of the results. Wednesday's warm-up with the ADP report will surely shed some light; how much is unknown, though the gauge, issued at the beginning of each month two days prior to the government data, has proven highly reliable in its short life (less than a year).
Dow 10,405.98, +2.19 (0.02%)
NASDAQ 2,280.79, +7.22 (0.32%)
S&P 500 1,118.31, +2.60 (0.23%)
NYSE Compos 7,135.97, +35.22 (0.50%)
Making the tiny headline numbers appear understated, gainers outpaced losers on the day by a good spread, 4477-2023, better than 2:1. The number of new highs was once again elevated, at 624; there were only 48 new lows. Those number will change dramatically by the end of the month, more than likely in favor of new lows. Volume on the session was very strong on the NASDAQ, not so good on the NYSE.
NYSE Volume 4,788,700,000
NASDAQ Volume 2,683,460,000
Commodities are once again acting like demand is robust, though the current price regime is more about trading, seasonality and short-term profits rather than real supply-demand metrics. Oil was up $1.02, to $79.72. Gold gained $19.00, to $1,137.30, while silver shot up 59 cents, to $17.06. While pricing in the energy complex can be chalked up to seasonal conditions (doesn't fuel always go up when people drive more in the Spring?), the metals are retracing their gains from last year in a technical move that probably will end up pushing against new highs. At some point, gold investors will realize that their precious metal is in just another bubble, created by speculators and quick-buck artists. After rising for nine straight years, gold's price is reflective of two things: greed, and widespread distrust of current monetary and fiscal policies of countries using fiat currencies.
If the detractors of floating exchange rates, the Euro experiment and gobs of debt around the world are correct, the precious metals will be even more so in months and years ahead. The wild card in their calculations, however, is global deflation, which would undermine almost any asset, including gold, silver and platinum. Time will tell.
Monday, March 1, 2010
March Comes in Like a Lion
Following weeks of seemingly-relentless snowstorms and market turmoil, investors looked forward (maybe) to new gains with the coming of Spring - now just 19 days away.
The NASDAQ was the clear winner on the day, breaking loose from its moorings at the 50-day moving average and powering ahead for a return of better than 1.5%. The Dow was the laggard of the group, though it may be more indicative of where stocks are really headed: nowhere fast. Both the Dow and S&P 500 indices are stuck at or near their 50-day moving averages in anticipation of Friday's key non farm payroll report for February.
Overall, market conditions are vastly improved from a year ago, though the overhang of debt - federal, state, Greek, household and otherwise - still remains prominent on investor minds. The question remains whether the recovery is actually providing progress or is still a mirage, a house of debt cards that eventually must tumble. Most investors - for today, at least - see the glass as half full. A positive employment report would likely send stocks through the recent January highs, setting off even more speculative market play. The chances for such an event seem very good, given the government's recent effort to manage both expectations and the massaging of key data.
Current expectations are for job losses in February to maintain their level of between 20 and 50,000, which would actually be not very good news, so the government and Wall Street could tag-team to new levels if the data can show an actual increase in the number of people working for a living in the USA. We'll all know by Friday morning, but a good indicator will be ADP's private payroll report on Wednesday, also looking for a decline, albeit, a smaller one.
Meanwhile, cash remains king of all assets, especially with the US dollar continuing to gain versus most other currencies. While the US may have a bad cold, the rest of the world (especially Europe) is suffering from anything ranging from common flu to the bubonic plague.
Notwithstanding the NASDAQ, stocks may be hard-pressed to reach beyond levels seen on February 19, the last interim high, still overhead. Many stocks are approaching p/e levels usually reserved for hot tech stocks in early stages of growth. When stocks such as Home Depot are trading at 20 times earnings, there should be cause for caution and requisite concern. The markets are still at inflection points, and the general trend lower has not been broken.
That stocks may be stuck should come as no surprise after last year's spectacular run-up off the crash. We stand just 6 trading days away from the 1-year anniversary of the market bottom, a notable event.
Dow 10,403.79, +78.53 (0.76%)
NASDAQ 2,273.57, +35.31 (1.58%)
S&P 500 1,115.71, +11.22 (1.02%)
NYSE Composite 7,100.75, +65.71 (0.93%)
Advancers dominated declining issues by a margin of better than 3:1, with 5009 stocks higher and 1528 lower. There were 534 new highs, owing to the comparisons to last year, against just 48 new lows. Volume was very solid on the NASDAQ, but below average on the NYSE.
NYSE Volume 4,388,033,000
NASDAQ Volume 2,373,148,500
For a change, oil actually traded lower, down 90 cents, to $78.76. The metals remained about even, with gold losing 60 cents, to $1,118.30, and silver down 6 cents, at $16.46. More than a few analysts are calling for higher commodity prices, though the deflationists will stick to their guns, expressing the unpopular belief that prices of assets cannot rise in an environment dominated by deficits, debt and destruction of wealth, still ongoing.
Stock traders made the best of the day, though there really is still no major catalyst for another move higher. In fact, housing continues to stagger along, with construction spending falling for the third straight month, down 0.6% in January.
According to the Associated General Contractors of America, construction hit a 6-year low in 2009, led by huge declines in lodging, retail and office building. While not attempting to argue with the facts, private construction spending can actually get worse in 2010, as there are still no signs that the flagging economy is doing anything other than simply bumping along the bottom.
The NASDAQ was the clear winner on the day, breaking loose from its moorings at the 50-day moving average and powering ahead for a return of better than 1.5%. The Dow was the laggard of the group, though it may be more indicative of where stocks are really headed: nowhere fast. Both the Dow and S&P 500 indices are stuck at or near their 50-day moving averages in anticipation of Friday's key non farm payroll report for February.
Overall, market conditions are vastly improved from a year ago, though the overhang of debt - federal, state, Greek, household and otherwise - still remains prominent on investor minds. The question remains whether the recovery is actually providing progress or is still a mirage, a house of debt cards that eventually must tumble. Most investors - for today, at least - see the glass as half full. A positive employment report would likely send stocks through the recent January highs, setting off even more speculative market play. The chances for such an event seem very good, given the government's recent effort to manage both expectations and the massaging of key data.
Current expectations are for job losses in February to maintain their level of between 20 and 50,000, which would actually be not very good news, so the government and Wall Street could tag-team to new levels if the data can show an actual increase in the number of people working for a living in the USA. We'll all know by Friday morning, but a good indicator will be ADP's private payroll report on Wednesday, also looking for a decline, albeit, a smaller one.
Meanwhile, cash remains king of all assets, especially with the US dollar continuing to gain versus most other currencies. While the US may have a bad cold, the rest of the world (especially Europe) is suffering from anything ranging from common flu to the bubonic plague.
Notwithstanding the NASDAQ, stocks may be hard-pressed to reach beyond levels seen on February 19, the last interim high, still overhead. Many stocks are approaching p/e levels usually reserved for hot tech stocks in early stages of growth. When stocks such as Home Depot are trading at 20 times earnings, there should be cause for caution and requisite concern. The markets are still at inflection points, and the general trend lower has not been broken.
That stocks may be stuck should come as no surprise after last year's spectacular run-up off the crash. We stand just 6 trading days away from the 1-year anniversary of the market bottom, a notable event.
Dow 10,403.79, +78.53 (0.76%)
NASDAQ 2,273.57, +35.31 (1.58%)
S&P 500 1,115.71, +11.22 (1.02%)
NYSE Composite 7,100.75, +65.71 (0.93%)
Advancers dominated declining issues by a margin of better than 3:1, with 5009 stocks higher and 1528 lower. There were 534 new highs, owing to the comparisons to last year, against just 48 new lows. Volume was very solid on the NASDAQ, but below average on the NYSE.
NYSE Volume 4,388,033,000
NASDAQ Volume 2,373,148,500
For a change, oil actually traded lower, down 90 cents, to $78.76. The metals remained about even, with gold losing 60 cents, to $1,118.30, and silver down 6 cents, at $16.46. More than a few analysts are calling for higher commodity prices, though the deflationists will stick to their guns, expressing the unpopular belief that prices of assets cannot rise in an environment dominated by deficits, debt and destruction of wealth, still ongoing.
Stock traders made the best of the day, though there really is still no major catalyst for another move higher. In fact, housing continues to stagger along, with construction spending falling for the third straight month, down 0.6% in January.
According to the Associated General Contractors of America, construction hit a 6-year low in 2009, led by huge declines in lodging, retail and office building. While not attempting to argue with the facts, private construction spending can actually get worse in 2010, as there are still no signs that the flagging economy is doing anything other than simply bumping along the bottom.
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