Stock Market Update -Jan 31st

Well, the first month of the year is over, and it was not a good one for the market. The chart below shows red in every sector. The market couldn't rally even with a great GDP number on Friday, and with great earnings from companies like MSFT, AMZN, and AAPL; in fact the technology sector sold off hard too. We may see a pause or a short term bounce soon though.

Stocks advancing in a bad market: GMCR GIS NFLX


New unemployment claims were down, coming in at 470,000.
And six more banks were shutdown this week! (list).

Next week: Earnings season continues with reporting from PFE, CSCO (Wed), V, MA, UPS, BP, and XOM (Mon), among others. XOM has already sold off hard in the past two months, so I don't expect much more downside action like we saw in CVX and COP. We also get the important monthly payroll report on Friday.

Market commentary:
We have had quite a pullback in the past two weeks, so I would expect some kind of relief rally or pause this week. The volume on this pullback has been high, so we could see more downside action eventually, maybe to the lows of last October (around 9600 on the DOW). The Dollar also continues to gain strength, and with concerns about Greece, we could see more upside action in the Dollar, which generally means more downside action in stocks.

Commodities:
Oil prices continued to slide, closing the week just under $73 per barrel.
Natural Gas was down, closing around $5.13.
Gold prices fell, closing around $1083; we could see more downside action here.
The US Dollar index was up, closing just under 80.
Bond prices rallied up to $118, again as stocks tumbled.

Amazon shares jump
Microsoft profit soars 60%

Equities Roundup: Dow's January Decline Is Biggest in 11 Months
Nasdaq battered as techs slump
U.S. Economy: Growth Jumps 5.7%, Fastest Pace in Six Years
Consumer Sentiment Hits Two-Year High
DEFAULT RISK FOR FINANCIALS SHOOTS UP

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Stock Market Update -Jan 24th

Another bad week for the markets. We got the correction I expected as I wrote in last week's update, as more earnings reports were released, and as the government proposed stricter regulations for banks, and as the US Dollar rallied some more. This was the worst week for the DOW since the rally began last March.

Amid the carnage, these stocks were up last week: ISRG CREE
Also: VXX (tracks volatility)
And some favorite leveraged inverse ETFs: FAZ, QID, SMN, SRS


New unemployment claims were up, coming in at 482,000.
Four more banks were shutdown this week! (list).

Next week: Earnings season continues with reporting from AAPL, AMZN, MSFT, YHOO, F, CAT, JNJ, and PG among others. We also get a number of economic reports, as well as a Fed meeting, and the GDP report, so it will probably be a volatile week.

Market commentary:
A correction has begun and we could see the DOW break below 10,000 again. If the response to upcoming earnings is anything like the past two weeks, we could see more stocks take a tumble. Gold equities have been hit hard in the past two weeks as well, but may have more downside action before rallying again. Likewise for commodity and basic materials stocks.

Also, the market once again fooled a lot of traders who were short, this time with Treasury Bonds! Bonds rallied, but we could see another 'short' opportunity here around 119, and possibly even higher.

Commodities:
Oil prices continued to slide, closing the week just under $73 per barrel.
Natural Gas was up, closing around $5.80.
Gold prices fell, closing just under $1090, breaking under the $1100 mark again.
The US Dollar index was up, closing just under 78.50.
Bond prices rallied to $119 as stocks tumbled.

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Japan Airlines files for bankruptcy protection
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Wal-Mart to cut 11,200 jobs at Sam's Club
New Leveraged Long Treasury ETFs from ProShares

Google sales rise 17%, beats Street - Jan. 21, 2010
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BofA Posts $5.2 Billion Loss as It Repays Bailout
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The Outlook for Stocks, Gold and the Dollar

Stock Market Update -Jan 17th

We got great earnings numbers from three DOW components, but the market sold off all three companies (AA, INTC, JPM) -this might be an indication of things to come next week! All the bearish Options traders were taken out this month as their 'puts' expired worthless yet again.


New unemployment claims for the week came in at 444,000.
Two more banks were shutdown this week! (list).

Next week: We have a short week. Lots of earnings reports this week including:
AXP, BAC, C, GS, MS, GE, GOOG, IBM

Market commentary: This week's market action will be mostly driven by earnings reports. Investor's sentiment is extremely high at this point, and may be a good contrarian indicator. The market may be finally topping out here for a short correction.

Commodities:
Oil prices topped out around $84, dropping all week to close around $78 per barrel.
Natural Gas dropped a bit, closing around $5.70.
Gold prices were up and down, closing mostly unchanged around $1140.
The US Dollar index gained some strength on Friday, closing just over 77.
Bond prices were up for the week. closing just over $117.

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Stock Market Update -Jan 10th

The much anticipated jobs report came in worse than expected on Friday, but had little effect on the market. The unemployment rate remained at 10%, with 15.3 million officially unemployed! The market rallied on Monday, but was pretty much flat for the rest of the week.

CY, DNDN, ESRX, IVN, OSIS, TEVA, XRA hit all time highs this week!
Perhaps GOOG topped out this week with the Nexus phone announcement?


New unemployment claims for the week came in at 434,000 (chart).
Yet Another bank was shutdown this week! (list).

Next week: Earnings season begins with reporting from AA, INTC, and JPM, among others. We also get Retail sales on Thursday, and the CPI report on Friday, along with options expiration on Friday.

Market commentary: The market continues to rise as traders continue to bet against it. Maybe we'll see a change after options expiration on Friday, or as earnings reports begin to roll in. The bull trend is still very much intact until we see a downturn in the charts.

Commodities:
Oil prices continued to rise, closing the week around $83 per barrel.
Natural Gas was more or less unchanged, closing around $5.80.
Gold prices recovered a bit, closing around $1138.
The US Dollar index fell, closing just under 78.
Bond prices saw little net change for the week.

Hi yield Corporate Bond prices have performed as well as the S&P500 this past year (click image for an interactive chart). Investors have been chasing yields. Government Bonds didn't do so well (bottom chart).

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Stock Market Update -Jan 3rd

Happy New Year to all. Lets hope the market performs as well in 2010 as it did in 2009.
This past week the market lost some ground, with a last minute sell-off on the last trading day of the year (2009 review below).


New unemployment claims came in at 432,000, the lowest level since 2008 (chart).
No banks were shut down this week! (list).

Commodities:
Oil prices continued to recover, closing the week just over $79 per barrel.
Natural Gas pulled back, closing around $5.60.
Gold prices fell some more, closing just under $1100.
The US Dollar index was more or less flat, closing around 78.
Bond prices fell further.

Next week: All eyes are on the monthly jobs report due on Friday.

Market commentary: For the week ahead, it's anyones guess as to what the market will do, so use caution! There is no clear short term trend at this point. We could get an early rally or a drop, followed by the market reaction to the jobs report on Friday. A lot of stocks, as well as the major indexes, look extended at this point, and many people are looking for a correction. The contrarian in me says to take the other side of that trade, at least until option expiration in two weeks. Earnings reports will be coming up a week from now as well.

My outlook for 2010?
I expect to see gold prices rally once again after this current pullback.
Likewise, we could see more pressure on the dollar after the current rally fades.
The stock market will probably be in a trading range all year.
Bonds prices will eventually drop (long term rates will rise).
Energy and Materials could outperform; also Technology.
We could see further food commodity price increases.
Emerging markets will continue to outpace the US.

Last year's comments ...Jan 2009 blog excerpt: Gold and Silver stocks are moving up nicely; I expect this to be an excellent year for these stocks... (well, it was an excellent year -many were up over 100%!)

* * * To everyone, best of luck in your trading for the new year! * * *

News:
Citi: The Third Worst Stock On S&P In 2009
India economy to grow 8 pct in FY '11, adviser says-report
China Manufacturing Growth Increases to 20-Month High

**** A look back ****

2009 best DOW performer (+120%): AXP
2009 worst DOW performer (-15%): XOM
2009 best major 'index ETF' performer (see chart below): QQQQ
2009 best S&P500 sector: XLK (technology)

A look at 2009:

The stock market took off in early March and never looked back!
Oil prices recovered from the bottom around $34, to over $80
Natural Gas fooled everyone and never recovered (ETF story)!
Lots of money poured into corporate bonds, chasing high yields: LQD, HYG, JNK
Government debt exploded
Foreclosures hit a record, with lots more expected!
We saw GM and Chrysler go under, and re-emerge as new companies
Unemployment shot up to 10.2%
Stocks, gold, and oil rallied as the US Dollar plummeted!
Gold rallied to $1220 before pulling back a bit
Interest rates from the Fed remained at close to zero in an effort to stimulate the economy
...the economy didn't get stimulated!
Hard lessons learned from 'leveraged' ETFs (SRS, TZA, etc.)
Sugar and Copper were the star performers in commodities

A look at the past decade:
The Best Stocks Of The Decade GMCR 7895% (who would have thought 'coffee'?)
U.S. Stocks Drop as Crisis Causes S&P 500’s First Decade Loss
A Lost Decade for U.S. Stocks
BUY & HOLD is dead for now!
The Russell 2000 is the only major index up for the decade (small caps)
China Is Now The World’s Second Largest Economy
Winners & Losers
The Graph That Says Everything About The Decade
Gold outperformed!
Top 5 commodities: Sugar, Cocoa, Copper, Gold, Platinum
15 Gadgets That Changed Everything This Decade

So whats ahead for '0' 10?
Eric Sprott Calls for New Lows on S&P 500...
For 2010, little improvement seen in job market
An Energy Investing Guide for 2010
Ten Best ETFs for 2010