Jul 252015
 

Market Conditions

The market giveth and the market taketh away. Last week the market posted solid gains, up 46.77 points (or 2.25%). This week the market gave it all back with the S&P 500 Index ($SPX) opening Monday at 2126.85 and closing Friday at 2079.65, down 47.2 or 2.22%. The yo-yo action has been the norm this year as the SPX has bounced between 2040 and 2135 for most of the year. With earnings season now in full swing and no major crisis on the horizon, the market gyrations are being ruled primarily by corporate earnings reports. This week the declines were the result of a series of earnings reports from widely-held companies that were deemed either not good enough, disappointing, or really disappointing. Apple ($AAPL) started off the week on Monday with its quarterly results exceeding expectations for both revenue and earnings per share. However, the margin by which they beat was not as large as quarters in the past resulting in a 7% drop in the stock. IBM ($IBM), Caterpillar ($CAT), and 3M ($MMM), which are also DOW components, also posted disappointing earnings setting the stage for the selloff. Biogen ($BIIB), a leading biotech, posted poor results and sold off 22% on Friday pulling down the biotech sector along with the rest of the market. Some stocks did post good results, such as Amazon ($AMZN), Startbucks ($SBUX), Juniper Networks ($JNPR) and Visa ($V), but it was too little, too late.

Chart_072415_SPX

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Jul 182015
 

Market Conditions

The major indexes posted solid gains this week as a result of both global events and higher-than-expected earnings results. Overseas, Greece capitulated and agreed to the austerity program offered by its creditors. In China, the stock market has pulled out of a three-week tailspin and their markets rebounded this week. The Nasdaq Composite ($COMP) received a boost from Google ($GOOGL) after the jumbotron stock reported better than expected earnings. The stock soared over 16% to a new record high which, in turn, lifted the COMP to a new record close of 5,210.14. The S&P 500 Index ($SPX) opened the week on Monday at 2080.03 and closed Friday at 2126.8, up 46.77 or 2.25%.

Chart_071715_SPX

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Jul 112015
 

Market Conditions

The major indexes ended the week on an upbeat note with the S&P 500 climbing back above its 200-day moving average (2,056), ending the week little changed. The week was largely news driven with China and Greece in the spotlight. On Sunday night, an overnight slide in the futures market resulted after the Greek referendum produced 61.3% ‘no’ vote, rejecting the bailout terms previously proposed by Eurozone creditors. The Shanghai Composite lost 5.9% on Wednesday, which triggered more volatility in the U.S. markets. However, later in the week, the U.S. markets rebounded in response to apparent stabilization of the Chinese stock market as officials in China introduced additional measures aimed at halting the market plunge by targeting “hostile short-sellers”. Elsewhere, remarks from top Eurozone officials also contributed to investor optimism as Greece announced its plans to submit concrete, realistic reform proposals. The $SPX opened Monday at 2073.95 and closed Friday at 2076.62, up 2.67 or 0.13%.

Chart_071015_SPX

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Jul 072015
 

trading-tools-375Over the past six trading sessions, volatility in both equities and crude oil has expanded considerably due to the financial crisis in Greece and, to a lower degree, China. Coupled with the increase in volatility has been substantial moves lower in both equities and oil. On June 29th, the S&P 500 Index ($SPX) opened at 2098.63. Since that day, it has been in a freefall. Today the SPX dropped to 2044.02, its lowest point since mid-March before rebounding strongly at the end of the day to close at 2081.34. Oil has had a similar fate, opening on June 29th at $58.85 per barrel. Today /CL hit $50.58 per barrel before its afternoon rally, closing at $52.95. Although both of these benchmarks had strong closes today, they are still significantly lower than they were several weeks ago. When volatility expands rapidly and an underlying moves sharply against a position, it may be necessary to make a trade adjustment. Adjustments are one of the many tools that should be part of any trader’s toolbox. Continue reading »

Jul 032015
 

Market Conditions

The markets were shaken this week after Greek leaders said “no” to the Eurogroup’s cash-for-reform proposal last weekend. Almost every major market closed down at least 2% on Monday. On Thursday, the Nonfarm Payrolls report for June missed estimates (223,000 vs. 230,000 expected) with the wage component showing no monthly growth. The S&P 500 opened Monday at 2098.63 and closed the abbreviated trading week on Thursday at 2076.78, down 21.85 points or 1.04%. The $SPX continues to maintain a strong support zone at the 2050-2070 level.

Chart_070315_SPX

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