Market Soapbox 05/24/05
Resistance: DJIA 10600; SP500 1200; Nasdaq 2100; NDX 1550
Support: DJIA 10400 ; SP500 1180 ; Nasdaq 2000; NDX 1500
Positive: energy, tech, biotech, drug, semi, hardware, disk drive, software
Weak: financial, materials, industrials, consumer discretionary, autos, auto parts suppliers, brokerage, banks, retail, transportation, airline
For 52 Week HiLo, A/D Volume, Volume and Market Momentum go to the sidebar, look for Favorite Tools - BarCharts - Market Momentum, click on it. Everything you ever needed in one screen.
Economic Reports of Note:
WEN: Durable Orders (est. +1.5%, prev. -2.3%); New Home Sales (est. 1325K, prev. 1431K)
THU: Chain Deflator Prel. (est.3.2%, prev. 3.2%); GDP Prel. (est. 3.7%, prev. 3.2%); Jobless Claims (est. 320K, prev. 321K)
FRI: Personal Income (est. 0.6%, prev. 0.5%); Personal Spending (est. 0.8%, prev. 0.6%); Michigan Sentiment Revised (est. 85.3, prev. 85.3)
Existing Home Sales 7.18M (est. 6.90M, prev. 6.89M). European & Asian markets were down. Dollar down vs. Yen/Euro, gold, oil, bonds & commodities up. Contra action: None
Today's Soohey Pig Pig!! Award goes to JP Morgan for helping to prop up the semis. Morgan commented that several leading indicators (gross margin, utilization rate, EPS estimates and YOY growth rates) should begin to improve in the second half of 2005. Really?
Is this an admission that those items are currently not up to snuff? And with North American chip sales off by 37% in April, what do you think the 2nd Qtr results will look like? The Nasdaq caught a bid for the 8th consecutive day, this hasn't happened since Dec. 1999. A big Soohey Pig Pig!!!
A choppy sideways split tape day, resulting in a quiet close and a continuation of the Nasdaq's longest winning streak since December 1999. 6 of 10 sectors down on lite volume.
July Oil futures are still over $49. GM and GMAC debt downgraded to junk by Fitch's, thats strike two (S&P @ junk, Moody's just above) and a real flood of junk runneth on the Street. I wonder how Kerkorian's bid is going?
Metals looked good again today, Gold Bugs (+2.5% today) and the XAU have been screaming since the 13th. Profunds Precious Metals Fund is +5.6% in that period.
Watch the gold stocks rising as gold prices stay flat or fall, this could be a signal that the Boyz in Bermuda Shorts are rotating into gold stocks, as they may be planning to pull their plug on the dollar after driving gold prices and issues down. That's why they call them HEDGE funds.
Financial was weak, due to interest rate fears. Those fears didn't scare anyone away from homebuilders as they were up again. At the same time Merrill Lynch downgraded several REITs', one day after the Morgan Stanley REIT index hit an all time high.
Why would you downgrade the REIT's? Rates are low, homebuilding and sales are good, Bill Gross sez the 10 year will be at 3% by next year, theres a bond party going on, all this means big money for the REIT's, right? Sniff, sniff.
The FOMC minutes indicate that core inflation gauges are "likely to remain in check", recent slower economic growth is "likely to be transitory".
Most Fed members agree that "short-term rates remained too low to be consistent with sustainable growth and stable prices in the long run," as the data hinted at "possible upside price risks."
This is NOT a newsflash for those who read these pages: The Fed is going to continue to raise rates, yield curve and bond market be dammed.
10 year note @ 4.03, 30 year bond @ 4.36, the spread is 33 basis points. Warning, Warning, Danger Will Robinson. Read today's Yield Curve Inversion III post for more details.
Wen. I look for more sideways action on low volume. We seem to have hit a plateau after last Wen. big surge. I sense that today's down day was a blip on the radar.
There's a tremor in the force, something malodorous is in the air, something nasty and odious lurking in the woodshed, I just can't seem to put my finger on it.
If the market heads for 10800 - 11000 we could see one of two things, a break out to the upside, or another miserable failure at that level. A break out might occur if the Fed pauses on rate increases sometime this summer.
We take it day by day and keep our eyes peeled to the sky, because it could be a name brand that pancakes us. Just my opinion, I could be wrong. P.S. Please read Friday's Vacation posting.
Support: DJIA 10400 ; SP500 1180 ; Nasdaq 2000; NDX 1500
Positive: energy, tech, biotech, drug, semi, hardware, disk drive, software
Weak: financial, materials, industrials, consumer discretionary, autos, auto parts suppliers, brokerage, banks, retail, transportation, airline
For 52 Week HiLo, A/D Volume, Volume and Market Momentum go to the sidebar, look for Favorite Tools - BarCharts - Market Momentum, click on it. Everything you ever needed in one screen.
Economic Reports of Note:
WEN: Durable Orders (est. +1.5%, prev. -2.3%); New Home Sales (est. 1325K, prev. 1431K)
THU: Chain Deflator Prel. (est.3.2%, prev. 3.2%); GDP Prel. (est. 3.7%, prev. 3.2%); Jobless Claims (est. 320K, prev. 321K)
FRI: Personal Income (est. 0.6%, prev. 0.5%); Personal Spending (est. 0.8%, prev. 0.6%); Michigan Sentiment Revised (est. 85.3, prev. 85.3)
Existing Home Sales 7.18M (est. 6.90M, prev. 6.89M). European & Asian markets were down. Dollar down vs. Yen/Euro, gold, oil, bonds & commodities up. Contra action: None
Today's Soohey Pig Pig!! Award goes to JP Morgan for helping to prop up the semis. Morgan commented that several leading indicators (gross margin, utilization rate, EPS estimates and YOY growth rates) should begin to improve in the second half of 2005. Really?
Is this an admission that those items are currently not up to snuff? And with North American chip sales off by 37% in April, what do you think the 2nd Qtr results will look like? The Nasdaq caught a bid for the 8th consecutive day, this hasn't happened since Dec. 1999. A big Soohey Pig Pig!!!
A choppy sideways split tape day, resulting in a quiet close and a continuation of the Nasdaq's longest winning streak since December 1999. 6 of 10 sectors down on lite volume.
July Oil futures are still over $49. GM and GMAC debt downgraded to junk by Fitch's, thats strike two (S&P @ junk, Moody's just above) and a real flood of junk runneth on the Street. I wonder how Kerkorian's bid is going?
Metals looked good again today, Gold Bugs (+2.5% today) and the XAU have been screaming since the 13th. Profunds Precious Metals Fund is +5.6% in that period.
Watch the gold stocks rising as gold prices stay flat or fall, this could be a signal that the Boyz in Bermuda Shorts are rotating into gold stocks, as they may be planning to pull their plug on the dollar after driving gold prices and issues down. That's why they call them HEDGE funds.
Financial was weak, due to interest rate fears. Those fears didn't scare anyone away from homebuilders as they were up again. At the same time Merrill Lynch downgraded several REITs', one day after the Morgan Stanley REIT index hit an all time high.
Why would you downgrade the REIT's? Rates are low, homebuilding and sales are good, Bill Gross sez the 10 year will be at 3% by next year, theres a bond party going on, all this means big money for the REIT's, right? Sniff, sniff.
The FOMC minutes indicate that core inflation gauges are "likely to remain in check", recent slower economic growth is "likely to be transitory".
Most Fed members agree that "short-term rates remained too low to be consistent with sustainable growth and stable prices in the long run," as the data hinted at "possible upside price risks."
This is NOT a newsflash for those who read these pages: The Fed is going to continue to raise rates, yield curve and bond market be dammed.
10 year note @ 4.03, 30 year bond @ 4.36, the spread is 33 basis points. Warning, Warning, Danger Will Robinson. Read today's Yield Curve Inversion III post for more details.
Wen. I look for more sideways action on low volume. We seem to have hit a plateau after last Wen. big surge. I sense that today's down day was a blip on the radar.
There's a tremor in the force, something malodorous is in the air, something nasty and odious lurking in the woodshed, I just can't seem to put my finger on it.
If the market heads for 10800 - 11000 we could see one of two things, a break out to the upside, or another miserable failure at that level. A break out might occur if the Fed pauses on rate increases sometime this summer.
We take it day by day and keep our eyes peeled to the sky, because it could be a name brand that pancakes us. Just my opinion, I could be wrong. P.S. Please read Friday's Vacation posting.
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