Stock Market Update -Apr 26th

The six week rally finally slowed down a bit this week as we got a slew of earning reports. Sector performance was mixed (see chart below). Ford shares rallied on their earnings announcement, while GM continues to struggle with a potential bankruptcy filing. American Express shares also rallied. The Materials sector got a boost as the US Dollar sank further -we could expect a further decline in the Dollar. Next week also have over $150 billion in Bonds being brought to market.

New Unemployment claims for the week came in over 600,000 again, and this time four more banks were shut down by regulators (list), along with one Credit Union.

Commodities: Oil prices dipped, then closed back up around $51 per barrel. Gold prices rose to $913 as the US Dollar fell, and as China reported a huge rise in gold reserves. Bonds also fell further this week (resulting in higher interest rates).

Next week the earnings reports continue to roll in, including that of the major oil companies. We get the 1st quarter GDP report on Wednesday, and we also have a Fed meeting. We could also get news on the GM or Chrysler bankruptcy.

Market outlook: The market is poised to break thru the 875 level on the S&P500. So far the reaction to earnings has been mostly positive, so I expect the rally will continue up to the Jan 6th top of around 903, though it could be a bumpy ride getting there.

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Stock Market Update -Apr 19th

The rally continues (6th week now) led by the Financial companies again, as we await more earnings reports next week. New unemployment claims for the week came in over 600,000 again, and two more banks were closed by regulators (list).

Commodities: Oil prices are still holding around $50 per barrel, while Gold prices dropped further, closing near $868. The US Dollar index is gaining ground again, while Bonds look like they want to fall further (resulting in higher interest rates).


Next week we get earnings reports from some of the big companies like BAC, AXP, WFC, MS, IBM, MSFT, AAPL, KO, MCD, F, CAT, FCX, and lots more. This will be a big week for earnings, with many companies reporting.

Market outlook: We made it up to the 875 level in the S&P500 that I mentioned last week (see chart above). It's anyones guess as to whether it will now continue straight to the January high of 943, or whether it will pull back first, but I believe that is where we are headed (I think it will pull back first).

The Next Leg up in Financials
U.S. Aims to Release Bank Stress-Test Results May 4
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General Growth Files Biggest U.S. Property Bankruptcy
Volcker: Recovery will be a 'long slog'
US foreclosures up 24 percent in 1st quarter

Taxing Grandma to Subsidize Goldman Sachs
Wells Fargo’s Profit Looks Too Good to Be True
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Stock Market Update -Apr 12

The rally continues, now 5 weeks in a row, with the Financial sector leading the way again! (see chart below, right). Looks like we might be headed for that January high that I mentioned last week. New unemployment claims for the week came in over 600,000 again, and two more banks were shut down by regulators.

Commodities: Oil prices are holding around $52 per barrel, while Gold prices continue to lose ground closing near $880.


Next week begins a new earnings season with big names reporting like Citi, Goldman, JP Morgan, GE, J&J, Intel, and Google. In addition there are a number of key economic reports due to be released, and don't forget Options expiration on Friday.

Market outlook: We could see a continuation of the rally up to the 875 level on the S&P500. It all depends on reaction to the earnings reports next week.

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U.S. budget deficit triples to $957 billion for year
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Mall vacancies at a record high in 2009
Economists expect recession to end in September

Stock Market Update -Apr 5th

The market continued its upward trend for the fourth week in a row, in spite of the bad news reported Friday on job losses for March, with the unemployment rate now at 8.5%. New unemployment claims for the week came in over 600,000 again (more than 8 consecutive weeks now, and since last October, more than 500,000 each week). Meanwhile the debt clock on the left races along at a faster pace, now over $11.1 trillion!

The much talked about 'mark to market' rules were relaxed by FASB this week, though it didn't seem to provide much of a boost to the Financial stocks. Of the four major indexes (DOW, NASDAQ, S&P500, Russell 2000), the Russell 2000 is leading the rally (smaller companies). IBM has been the leader for the year in the DOW index.

Commodities: Oil prices are holding above $50 per barrel, Gold prices continue to lose ground, while the US Dollar also lost some ground. Grain prices also rose this week (Corn, Soybeans, Wheat).

Next week kicks off earnings reports for the first quarter. It's also right before Easter and Passover, so it could be a slow week, with the markets being closed on Friday. Market analysis: The current rally could eventually take us up to the Jan 6th high of 943 on the S&P 500, and 9088 on the DOW, with some pullbacks along the way. This week we could see one of those pullbacks, providing a opportunity to add to short term positions -remember however that we are still in a bear market! The short term target on the S&P is around 875, the February high.

News stories:
Stocks rise for fourth straight week; Dow moves back above 8,000
3 Dow Stocks Over Their 200-Day Moving Averages
U.S. Economy: Unemployment Rate Reaches 25-Year High
The Great Recession
Signs of life in California real estate
Why small companies keep shedding jobs

Uncle Sam's Massive Hedge Fund
Congress Approves Obama's $3.6 Trillion Budget
Making Home Affordable program may enable millions to refinance mortgages
Rate on 30-Year Mortage Falls to New Record of 4.78%
More U.S. consumers falling behind on loans

Stock Market Update -Mar 29th

The rally continues, with the Financial sector leading the way (see 5 day chart below). The Treasury Secretary gave the market a big boost on Monday with his rescue plan for the financial system, paving the way to clear out $1 trillion in toxic assets. We saw a small pickup in home sales, and housing inventory is starting to come down as well.

Yet another bank was shut down this week, and new unemployment claims came in over 600,000 again. Since February, we have seen new unemployment claims over 600,000 every week!

Commodities: Oil prices remain above $50 per barrel, Gold prices lost some ground, while the US Dollar rebounded a bit.

Next week marks the end of the 1st quarter for this year. On Friday we get the monthly payroll report, which can sometimes move the market in a big way. Market analysis: With the market being up 20% in three weeks, it's likely we will get a pullback, then possibly a continuation of the rally. For short term traders, this pullback would be a good point to enter the market again. For aggressive traders, the 'leveraged' ETFs could provide nice returns, as long as you use 'stops' on every trade (e.g. SSO, UWM, UYG)

The Financial sector recovered nicely compared to the overall market.

News stories:
Worst quarter for the economy since the 1930s
Economy rescue: Adding up the dollars
This Time, Geithner’s Plan for Banks Makes Sense
Bankers: Take your TARP money back
Obama’s bank plan could rob the taxpayer
White House finalizing plan for more auto aid

California's Wipeout Economy
China questions the dollar's role as a reserve currency
Japan Exports Drop Record 49% as Global Slump Deepens
Existing Home Sales - March Report
Jobless Rate Exceeds 10% in Three More U.S. States

Stock Market Update -Mar 22nd

The market rally continued this week, but started to fade on Thursday and Friday. This rally is the biggest 2 week rally we've seen in decades!

The rally got a big boost on Wednesday after the Fed announcement that they will start buying Treasuries and mortgage-backed securities (i.e. they will be creating money from thin air for these purchases!) This caused the US Dollar to drop even further, and Bond yields to drop, bringing mortgage rates down as well. The drop in the US Dollar caused a continued rise in Oil prices, closing above $50 per barrel, and Gold to surge to $952 per ounce. Welcome to the world of dollar induced inflation (two weeks ago I suggested that the US Dollar had probably hit a top.) Overall we saw a rise in most commodity prices this week.

Also three more banks were shut down, and two credit unions were shut down this week. And lets not forget, new unemployment claims this week came in over 600,000 again!


Next week the market might signal what direction it wants to follow. If it can move above the 50 day moving-average line (chart above), and that line can start turning up, we could see a much bigger rally in the coming weeks.

We also await the much anticipated bank rescue plan from the Treasury (the last 'much anticipated plan' from the Treasury turned out to be a big nothing).

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Banks, credit unions go bust
Nearly 15 percent of hedge funds closed last year
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Citigroup's Reverse Split: Will It Really Help?
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The Shadow of Depression
Treasury’s toxic asset plan could cost $1 trillion
Obama budget could bring $9.3 trillion in deficits
China ‘worried’ about U.S. Treasury holdings
Fed move is a market-changer as the dollar sinks
Dollar caps worst week in 24 years
The Dollar Is Dead

Stock Market Update -Mar 15th

This week we finally saw the markets rally (4 days in a row)! Citi and Bank of America had somewhat good news about profits, and the government started talking about maybe looking at 'mark to market' rules, which would affect the all the writedowns.

New unemployment claims this week came in over 600,000 again. Oil prices are still hovering around $45 per barrel, and the National Debt Clock has now crossed $11 trillion!



Next week we will see if the rally holds. Most people expect a pullback before rising further (if in fact it does rise further). We could also see Bond prices fall further based on comments from China regarding lending the US more money.

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Bonus Money at Troubled A.I.G. Draws Heavy Criticism
GM has more troubles than you think
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Stock Market Update -Mar 8th

The market sell-off continues, with the Financials leading the way again (some big losers in the DOW were Citibank, JP Morgan, GE, and General Motors). The major indexes have all lost at least 50% of their value from last year's high (DOW, NASDAQ, S&P500). The Financial sector has lost a little over 80%! More reasons to abandon that 'buy & hold' strategy that the 'experts' say we should use.

New unemployment claims came in over 600,000 again, with the jobless rate now standing at 8.1%. Oil prices started to move up, closing the week around $45 per barrel, and yet another bank was shut down this week.

Keep your eye on the debt clock (on the left) -now approaching $11 trillion!


Next week we could see more of the same unless some good news start to filter in. The S&P500 has now broken below the low-point we saw last November -not a good sign (see chart above). There is now talk of removing Citibank, Bank of America, and GM from the DOW as their valuations continue to dwindle -this could provide a boost for the DOW. Also, keep an eye on the US Dollar -we may be seeing a 'double top' in the recent US Dollar rally.


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