“The number of Americans seeking unemployment aid rose 32,000 last week to a seasonally adjusted 360,000, the most since late March. The jump comes after applications fell to a five-year low… Weekly applications are a proxy for layoffs. The big increase could mean companies are cutting more jobs, possibly because of steep government spending cuts that kicked in March 1. Labor officials said there were no special circumstances that caused the spike.”
http://abclocal.go.com/kfsn/story?section=news/business&id=9103355
PHILLY FED MANUFACTURING INDEX DROPS (WSJ Blogs)
“Mid-Atlantic manufacturers slipped into contraction this
month, according to a report released Thursday by the Federal Reserve Bank of
Philadelphia….“The current activity index has shown no pattern of sustained
growth over the past seven months, generally alternating between positive and
negative readings,” the report said.
The Philadelphia survey follows Wednesday’s report from
the New York Fed that said factories in the Empire State are also experiencing
slightly contractionary business conditions this month. Nationwide,
manufacturing output declined in March and April, according to Fed data.” Full story at…
http://blogs.wsj.com/economics/2013/05/16/philly-fed-manufacturing-index-drops/
ADS BUSINESS CONDITIONS INDEX (FROM PHILLY FED)
The ADS index still seems to indicate a slow decline in
business conditions with lower lows and generally lower highs.
PROFITLESS RALLY: STOCKS HEADING FOR A SLOWDOWN (CNBC)
“Stocks have rallied more than 30 percent on a global
basis since the 2011 slows, though earnings per share have been flat, according
to Citigroup…"We expect markets to make further gains supported by
moderate EPS growth and dividend increases," Citi analysts said in a
report that warned about the "profitless rally." But "valuations
imply less impressive gains from here," they said.http://www.cnbc.com/id/100743436?__source=yahoo%7Cfinance%7Cheadline%7Cheadline%7Cstory&par=yahoo&doc=100743436%7C%27Profitless+Rally%27:+Stock
MARKET NOT SPOOKED BY TAPER TALK – YET (CNBC)
"We're now in an environment where the market can
smell the end of QE coming up, or at least a tapering," said Deutsche Bank
G-10 currency strategist Alan Ruskin. "They can see a market where bond
yields are higher."
… "I think sometime in the summer or fall ... they
might start the taper," [BlackRock Managing Director Peter] Fisher said.
"That's the earliest, but if the economy is not doing very well, clearly
they left themselves the opening of whether to speed it up or slow it down."
David Ader, CRT Capital chief Treasury strategist, said
it's far from definite that the Fed is going to reduce purchases this year but
that tapering will have an impact when it happens…"Tapering of QE is going
to impact the long end, and in that respect, the Fed is going to be much more
sensitive to its influence on mortgages," he said.
http://www.cnbc.com/id/100741045
Yesterday I said if the market was up today, I’d eat my
hat. At mid-day it was up, so I
consulted Bubba on my options…
EATING MY HAT (Bubba)
“You can barbecue it, boil it, broil it, bake it, sauté
it. There's, um, hat kabobs, hat creole, hat gumbo, pan fried, deep fried, stir
fried. There's pineapple hat and lemon hat, coconut hat, pepper hat, hat soup, hat
stew, hat salad, hat in potatoes, hat burger, hat sandwich. That's, that's
about it."
MARKET RECAP
Thursday, the S&P 500 closed down 0.5% to 1,650 (rounded), so no hat eating today.
Thursday, the S&P 500 closed down 0.5% to 1,650 (rounded), so no hat eating today.
VIX was up 2% to 13.07 (Third day in a
row.).
NTSM
Thursday, the overall NTSM analysis was SELL at the close for reasons
outlined yesterday in the EXTREME BULLISHNESS paragraph.
In addition, today there was a statistical
indicator of complacency (I call the “calm-before-the-storm”) that often occurs
at or near a top. Bottom line, the
topping process continues.
MY INVESTED POSITION
I remain about 20% invested in stocks as of 5 March (S&P 500
-1540). My reasoning may be found at…(although
that probably looks pretty lame by now.)http://navigatethestockmarket.blogspot.com/2013/03/why-i-got-mostly-out-of-stock-market.html
The NTSM system sold at 1575 on 16 April. (This is just another reminder that I should follow the NTSM analysis and not act emotionally – I am under-performing my own system by about 2%!)
I have no problems leaving 20% or 30% invested. If the market is cut in half (worst case) I’d only lose 10%-15% of my investments. It also hedges the bet if I am wrong since I will have some invested if the market goes up. No system is perfect.
