05 Feb
Daily Market Commentary

Week In Review- 4th Consecutive Weekly Decline! 2.5.10

Friday, February 5, 2010
Market Commentary:

Stocks got smacked for the fourth consecutive week as the dollar rallied and fears spread that the economic recovery may slow. During that period, volume patterns have turned bearish on the NYSE and Nasdaq exchange which suggests large institutions are aggressively selling stocks. Decliners steadily lead advancers which is another disconcerting sign.  It is also worrisome to see the number of new 52-week highs continue to shrink as the number of new lows continues to expand.

Monday & Tuesday:

Stocks rallied on Monday continuing the recent string of a strong start to the week before the bears show up and send stocks lower by Friday. Stocks rallied on strong manufacturing reports from the US, Europe, and China. The Institute for Supply Management said that US manufacturing enjoyed its largest gain since August 2004 which was a welcomed sign. On Tuesday, stocks and commodities rallied as the dollar fell after healthy news from the ailing housing front was released and the Australian central bank unexpectedly left interest rates steady.

Wednesday- Friday:

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04 Feb
Daily Market Commentary

Day Count Reset; Market In A Correction 2.4.10

 Thursday, February 4, 2010
Market Commentary:

Stocks got whacked on Thursday sending all of the major averages below Monday’s lows as the dollar rallied. Volume was heavier than the prior session on the NYSE and Nasdaq exchange which signaled large institutions were aggressively selling stocks. Decliners trumped advancers by over a 7-to-1 ratio on the NYSE and over a 6-to-1 ratio on the Nasdaq exchange. There were only XX high-ranked companies from the CANSLIM.net Leaders List that made a new 52-week high and appeared on the CANSLIM.net BreakOuts Page, lower than the 10 issues that appeared on the prior session. New 52-week highs outnumbered new 52-week lows on the NYSE but trailed on the Nasdaq exchange.

Dollar Up; Stocks & Commodities Down:

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03 Feb
Daily Market Commentary

Day 3 Of A New Rally Attempt

Wednesday, February 3, 2010
Market Commentary:

The major averages ended mixed as the dollar rallied after the latest round of disappointing earnings and economic data was released. Volume was lighter than the prior session on the NYSE and Nasdaq exchange which signaled large institutions were not aggressively selling stocks. Decliners led advancers by nearly a 3-to-2 ratio on the NYSE and on the Nasdaq exchange. There were 10 high-ranked companies from the CANSLIM.net Leaders List that made a new 52-week high and appeared on the CANSLIM.net BreakOuts Page, lower than the 17 issues that appeared on the prior session. New 52-week highs still outnumbered new 52-week lows on the NYSE and on the Nasdaq exchange.

ADP- -22,000 Jobs Shed In January:

Before Wednesday’s opening bell, ADP, the country’s largest private payrolls company, said US employers cut -22,000 jobs last month which matched forecasts. Now investors are waiting for Friday’s official jobs report slated to be released this Friday at 8:30 am EST. Many pundits believe that US employers added jobs which would be the second monthly increase in three months.

Earnings Fail To Impress:

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02 Feb
Daily Market Commentary

Day 2 Of A New Rally Attempt

Tuesday, February 2, 2010
Market Commentary:

Stocks and commodities rallied as the dollar fell for a second consecutive day after healthy news from the ailing housing front was released and the Australian central bank unexpectedly left interest rates steady. Volume was heavier than the prior session on the NYSE and Nasdaq exchange which signaled large institutions were buying stocks. Advancers led decliners by over a 3-to-1 ratio on the NYSE and by a 5-to-4 ratio on the Nasdaq exchange. There were 17 high-ranked companies from the CANSLIM.net Leaders List that made a new 52-week high and appeared on the CANSLIM.net BreakOuts Page, higher than the 7 issues that appeared on the prior session. New 52-week highs still outnumbered new 52-week lows on the NYSE and on the Nasdaq exchange.

Australia’s Central Bank & The US Dollar:

Overnight, the Reserve Bank of Australia left rates steady at +3.75% which surprised a slew of economists and analysts across the globe. Nearly everyone believed that Australia would raise rates to combat inflation. This allayed pressure on other central bankers to start raising rates as we make our way out of the worst global recession since WWII. The Street believes that the European Central Bank (ECB) and the Bank of England (BOE) will keep borrowing costs unchanged when they meet later this week. The dollar fell for a second straight day which sent a host of dollar denominated assets higher on Tuesday.

Pending Home Sales & Strong Earnings From D.R. Horton:

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01 Feb
Daily Market Commentary

Day 1 Of A New Rally Attempt

Monday February 1, 2010
Market Commentary:

Stocks rallied on Monday continuing the recent string of a strong start to the week before the bears show up and send stocks lower by Friday. Volume patterns have turned bearish recently which suggests large institutions are aggressively selling, not buying stocks. New 52-week highs still continue to outnumber new 52-week lows on the NYSE and on the Nasdaq exchange which is a welcomed sign.

Economic Data Is Healthy:

Stocks rebounded from a three-month low and marked Day 1 of a new rally attempt after a series of stronger than expected economic data points were released. Manufacturing reports in the US, Europe and China all showed that the global economic recovery is accelerating which helped allay concerns that it was running out of steam. The US dollar fell which helped a slew of dollar denominated assets (mainly stocks and commodities) rally. The Institute for Supply Management said that US manufacturing enjoyed its largest gain since August 2004 which was a welcomed sign.

Earnings Are Solid:

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29 Jan
Daily Market Commentary

Stocks End The Day, Week, Month & Year In The Red

Friday, January 29, 2010
Market Commentary:

Stocks ended the day, week, month and year lower as investors digested the latest round of tepid economic and earnings data. Volume totals have turned bearish in recent weeks as large institutions continue dumping stocks. Decliners continue to lead advancers as the correction intensifies.
Timing The Correction:
On Friday, January 22, US stocks ended their 46 week rally and entered a correction when all the major averages plunged below their respective 50-day moving average (DMA) lines. Since the March 2009 low, none of the major averages fell more than-10% from their post recovery highs which reiterates how strong this market actually is. However, now that the market is in a correction and the Nasdaq is down just under -8% from its recent high; it will be very interesting to see if the bulls show up and quell the bearish pressure or the selling intensifies. It is important to note that even other developed markets overseas have performed rather well over the past 10 months. However, the Hang Seng Index, Hong Kong’s stock market, fell -10% from its recent high which could drag the rest of the world lower.
The latest round of corporate earnings continue to top analysts’ estimates but fail to impress Wall Street. In the last full week of January, more than 130 companies in the benchmark S&P 500 reported their Q4 results but stocks sold off. Barring some unforeseen event, earnings will have expanded nearly +70% and snapped a record nine-quarter earnings slump. Longstanding readers of this column know that in addition to analyzing the numbers we pay equal, if not more, attention to how the market reacts to the numbers. So far, the reaction has been lackluster at best.

Monday:

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28 Jan
Daily Market Commentary

Stocks Fall on Negative Economic & Earnings Data

Thursday, January 28, 2010
Market Commentary:

Stocks got smacked on Thursday as the dollar and shorter-term Treasuries rose after a series of negative economic data was released. Volume totals were higher on both exchanges compared to the prior session which suggested that large institutions were aggressively selling stocks. Decliners trumped advancers by well over a 2-to-1 ratio on the NYSE and on the Nasdaq exchange. There were 9 high-ranked companies from the CANSLIM.net Leaders List that made a new 52-week high and appeared on the CANSLIM.net BreakOuts Page, lower than the 10 issues that appeared on the prior session. New 52-week highs still outnumbered new 52-week lows on the NYSE and on the Nasdaq exchange.

Obama’s State Of The Union & Bernanke Reconfirmed:

The major averages negatively reversed, effectively ended their latest rally attempt and reset the day count after a slew of weaker than expected economic and earnings data was released. Stocks reacted poorly to Obama’s first State of the Union address largely due to his plan to increase taxes on the upper class and his plan to end proprietary trading and hedge-fund investments at large banks. Some highlights from his speech were: “the worst of the storm has passed, we face a deficit of trust, and I’m not interested in punishing banks.”
Over the past ten days, investors were concerned that Congress would not reconfirm Federal Reserve Chairman Ben S. Bernanke for a second term. However, those concerns were allayed four minutes before the closing bell when CNBC reported that Bernanke received enough votes for a second term.

Tech Stocks Get Smacked As The Dollar Rallies:

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27 Jan
Daily Market Commentary

Day 1 Of A New Rally Attempt

Wednesday, January 27, 2010 Market Commentary

The major averages positively reversed on Wednesday which marked day 1 of a new rally attempt. It was encouraging to see volume expand compared to the prior session which indicated that large instiutions were accumulating stocks. Decliners led advancers by a 10-to-9 ratio on the NYSE and trailed by a 5-to-8 on the Nasdaq exchange. There were 10 high-ranked companies from the CANSLIM.net Leaders List that made a new 52-week high and appeared on the CANSLIM.net BreakOuts Page, higher than the 6 issues that appeared on the prior session. New 52-week highs still outnumbered new 52-week lows on the NYSE and on the Nasdaq exchange.

Fed Decision and The Economy:

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26 Jan
Daily Market Commentary

Rally Attempt Ends As Stocks Negatively Reverse

Tuesday, January 26, 2010
Market Commentary:

The major averages negatively reversed, took out Monday’s lows, on heavier volume than the prior session. The ominous action effectively ended the current rally attempt and suggested that large institutions are aggressively selling stocks. Decliners led advancers by a 12-to-7 ratio on the NYSE and by an 18-to-9 ratio on the Nasdaq exchange. There were only 6 high-ranked companies from the CANSLIM.net Leaders List that made a new 52-week high and appeared on the CANSLIM.net BreakOuts Page, lower than the 7 issues that appeared on the prior session. New 52-week highs still outnumbered new 52-week lows on the NYSE and on the Nasdaq exchange.

Earnings Data: AAPL, VMW, VZ, etc…

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25 Jan
Daily Market Commentary

Day 1 Of A New Rally Attempt

Monday, January 25, 2010
Market Commentary:

Stocks closed with modest gains on Monday as fears subsided that Ben S. Bernanke may not be reconfirmed as chairman of the Federal Reserve. Volume was reported lower than Friday’s session on the Nasdaq exchange and on the NYSE which suggested large institutions were not aggressively buying stocks. Monday’s gains were enough to mark Day 1 of a new rally attempt for the major averages. Advancers led decliners by a 23-to-16 ratio on the NYSE and were about even on the Nasdaq exchange. There were only 7 high-ranked companies from the CANSLIM.net Leaders List that made a new 52-week high and appeared on the CANSLIM.net BreakOuts Page, higher than the 4 issues that appeared on the prior session. New 52-week highs still outnumbered new 52-week lows on the NYSE and on the Nasdaq exchange.

Hong Kong Stock Market Falls -10% From Recent High:

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