“With 21% of the companies in the S&P 500 reporting actual results, the percentage of companies reporting earnings above estimates (72%) is in line with the four-year average, while the percentage of companies reporting revenues above estimates (50%) is below the four-year average.”
“Earnings Growth Rebound Still Projected for 2nd Half 2013,
But Little Revenue Growth…At this early stage of the earnings season, 17
companies in the index that have issued [earnings per share] EPS guidance for
the third quarter. Fourteen companies have issued negative EPS guidance, while
three companies have issued positive EPS guidance.”
Report available from FACTSET at…http://www.factset.com/websitefiles/PDFs/earningsinsight/earningsinsight_7.19.13
MCDONALDS EARNINGS BELOW EXPECTATIONS
http://www.cnbc.com/id/100899153
EARNINGS – THIS IS THE WEEK THAT IS…
"Looking at the rest of the week ahead, it will be a
bumper one for U.S. earnings as around 160 S&P 500 constituents are
scheduled to report," wrote Deutsche Bank analyst Jim Reid, in a market
report. "With U.S. banks now largely out of the way, we should get a
clearer picture of how corporate America is performing." Story at…http://money.cnn.com/2013/07/22/investing/stocks-markets/index.html?iid=HP_LN
EXISTING HOME SALES FALL 1.2% (CNBC)
“US sales of previously occupied homes dipped in June to
5.08 million, but remain near 3 1/2-year high. Economists polled by Reuters
were expecting existing home sales to rise to a seasonally adjusted annual rate
of 5.26 million in June from 5.18 million the month before.” Story at…http://www.cnbc.com/id/100899588
Jeepers…there must some good news around…Yes there is;
the S&P 500 was up!
MARKET REPORT
Monday, the S&P 500 was up 0.2% to 1680 (rounded).
VIX was down 2% to 12.29. Monday, the S&P 500 was up 0.2% to 1680 (rounded).
As I wrote Friday, the Sell signal in the
NTSM system is based on bullish action in the market; high sentiment values;
“percent-above-the 200dMA”; and failure to decisively take out the prior
high. Except for that last one, the
others are all sentiment related – too much bullishness. It is important to remember that sometimes excessive
bullishness is the correct market call. That is true after a significant bottom. It is hard to know if the market will
shrug-off the current high sentiment and continue up. I don’t think so. I looked back as far as 2009: when conditions
were as bullish as today (in sentiment, bullish market action, high %-above the
200dMA) a top occurred shortly thereafter.
The tops were not necessarily “major” tops though, so this suggests
another correction to me. Perhaps the
S&P 500 will finally have that 10-20% correction that is overdue. It is not unusual for the extreme bullishness
to last for several days before topping.
Market internals can give us a clue.
I do see signs, today, of a turnaround in
market internals that would indicate a turn down in the general markets is likely
to follow. Whether this trend will continue
remains to be seen.
One indicator not confirming a downturn is
the VIX. It is neutral in my system and
has fallen to near 12. VIX was around 10
before the 2008-09 crash. If the options
boys expected a correction VIX should be rising.
NTSM
Monday, the overall NTSM analysis remained
SELL at the close.
MY INVESTED POSITION
I remain about 20% invested in stocks as of 5 March (S&P 500
-1540). 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.
