Market Soapbox 08/31/05
Resistance: DJIA 10750; SP500 1250; Nasdaq 2200; NDX 1625
Support: DJIA 10250 ; SP500 1200 ; Nasdaq 2050; NDX 1535
European markets up & Asian markets down. Dollar down vs. Yen/Euro , XAU up & gold down, XOI & oil up, commodities & bonds up.
Today's Soohey Pig Award goes to me for letting the pig have a quiet day in its poke.
Monday, a rebound in the face of $70 oil, the energy sector, tech and healthcare were the winners, transports & airlines got hit. Tues, whipsaw the other way, down 100 points until a last hour rally halved the damage.
Today, a sideways chop with the DJIA, SP500 & Nasdaq initially split tape. The RUT & MID were up nicely, oil, natural gas & gold bugs roared.
The DJIA, SP500 & Nasdaq rallied nicely by the end of the day and internals looked good. With days like Monday & today, one might think the market has turned.
Yesterday, bonds rallied big +18 ticks dropping the 10 year note to 4.09% intraday, today it rallied 17 ticks to 4.03% intraday. The spread between 2 year and 10 year is now at 18 basis points.
Yesterday, Crude, natural gas & unleaded futures were all up over 5.5%, 7.7%, 12.3% intraday. Today, homebuilding +3.34% & energy +2.51% sectors up.
The Fed FOMC minutes indicated that energy prices would probably feed core inflation and that the price of home appreciation is expected to slow.
Non farm payrolls will be released on Friday, the whisper number is 215K new jobs, the estimate 190K. A report at the whisper number or below will help the bond market.
An extremely low number will incite the bond market further in its latest rally and could hurt the stock market. A number substantially above whisper will hurt the bond market and benefit the stock market.
Novellus Systems Inc., which makes machines used in semiconductor manufacturing, expects Q3 profit to be .21 per share rather than the .22 average estimate that was expected.
Also, Q3 orders would range from $285-to-$290 million, from its previous forecast of $280-to-$310 million. Novellus slipped $1.04 to $26.46 in extended trading yesterday.
Today, Freddie Mac FHLMC, the second- largest source of money for U.S. home loans, will release second- quarter results after the market closes.
The Chicago PMI fell to 49.2 in August from 63.5 in July. Economists were expecting just a small drop to 61. Any reading below 50 indicates contraction in manufacturing activity.
Employment, production, and orders components of that report were all down from the prior month while the prices paid index was up slightly. The index has been above 50 for more than 2 years.
The ISM Index, which is a gauge of national manufacturing activity, is due out tomorrow. GDP checked in at 3.3% vs 3.4%, chain deflator unchanged at 2.4%.
The DOE announced it will tap into the SPR to mitigate supply disruptions. This did little to futures prices as the problem has been refining capacity, not supply.
If the indices should break these levels look out: NDX @ 1500; Nasdaq @ 2050; SOX @ 425; DJIA @ 10250; SP500 @ 1190; MID @ 675; RUT @ 625.
At the moment, even though the market performed nicely Monday & today, it appears that the downtrend is still intact. Although one could make a case that we have hit a turn point.
Month end action needs to be monitored CLOSELY. We are watching key support levels, internals and volume while waiting until after month end portfolio adjustments "window dressing" and inflows/outflows are made.
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.
Support: DJIA 10250 ; SP500 1200 ; Nasdaq 2050; NDX 1535
European markets up & Asian markets down. Dollar down vs. Yen/Euro , XAU up & gold down, XOI & oil up, commodities & bonds up.
Today's Soohey Pig Award goes to me for letting the pig have a quiet day in its poke.
Monday, a rebound in the face of $70 oil, the energy sector, tech and healthcare were the winners, transports & airlines got hit. Tues, whipsaw the other way, down 100 points until a last hour rally halved the damage.
Today, a sideways chop with the DJIA, SP500 & Nasdaq initially split tape. The RUT & MID were up nicely, oil, natural gas & gold bugs roared.
The DJIA, SP500 & Nasdaq rallied nicely by the end of the day and internals looked good. With days like Monday & today, one might think the market has turned.
Yesterday, bonds rallied big +18 ticks dropping the 10 year note to 4.09% intraday, today it rallied 17 ticks to 4.03% intraday. The spread between 2 year and 10 year is now at 18 basis points.
Yesterday, Crude, natural gas & unleaded futures were all up over 5.5%, 7.7%, 12.3% intraday. Today, homebuilding +3.34% & energy +2.51% sectors up.
The Fed FOMC minutes indicated that energy prices would probably feed core inflation and that the price of home appreciation is expected to slow.
Non farm payrolls will be released on Friday, the whisper number is 215K new jobs, the estimate 190K. A report at the whisper number or below will help the bond market.
An extremely low number will incite the bond market further in its latest rally and could hurt the stock market. A number substantially above whisper will hurt the bond market and benefit the stock market.
Novellus Systems Inc., which makes machines used in semiconductor manufacturing, expects Q3 profit to be .21 per share rather than the .22 average estimate that was expected.
Also, Q3 orders would range from $285-to-$290 million, from its previous forecast of $280-to-$310 million. Novellus slipped $1.04 to $26.46 in extended trading yesterday.
Today, Freddie Mac FHLMC, the second- largest source of money for U.S. home loans, will release second- quarter results after the market closes.
The Chicago PMI fell to 49.2 in August from 63.5 in July. Economists were expecting just a small drop to 61. Any reading below 50 indicates contraction in manufacturing activity.
Employment, production, and orders components of that report were all down from the prior month while the prices paid index was up slightly. The index has been above 50 for more than 2 years.
The ISM Index, which is a gauge of national manufacturing activity, is due out tomorrow. GDP checked in at 3.3% vs 3.4%, chain deflator unchanged at 2.4%.
The DOE announced it will tap into the SPR to mitigate supply disruptions. This did little to futures prices as the problem has been refining capacity, not supply.
If the indices should break these levels look out: NDX @ 1500; Nasdaq @ 2050; SOX @ 425; DJIA @ 10250; SP500 @ 1190; MID @ 675; RUT @ 625.
At the moment, even though the market performed nicely Monday & today, it appears that the downtrend is still intact. Although one could make a case that we have hit a turn point.
Month end action needs to be monitored CLOSELY. We are watching key support levels, internals and volume while waiting until after month end portfolio adjustments "window dressing" and inflows/outflows are made.
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.
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