“Orders for long-lasting U.S. manufactured goods unexpectedly rose in April, but a drop in a measure of business capital spending plans could temper expectations for a sharp rebound in economic growth this quarter. The Commerce Department said on Tuesday durable goods orders increased 0.8 percent as demand for defense capital goods surged and orders for fabricated metal products, transportation equipment and electrical equipment, appliances and components rose.” Story at…
http://www.reuters.com/article/2014/05/27/us-usa-economy-durablegoods-idUSKBN0E71GI20140527?feedType=RSS&feedName=businessNews
CONSUMER CONFIDENCE (CNBC)
“U.S. consumers were more optimistic in May than in April, the Conference Board reported on Tuesday, with sentiment recovering as shoppers became more optimistic about the future. The Consumer Confidence Index rose to 83 in May, up from 81.7 percent in the prior month…” Story at….
http://www.cnbc.com/id/101705931
I saw some very negative interpretation of the Richmond Fed data. The real scoop follows…
RICHMOND FED (Advisor Perspectives)
“Fifth District manufacturing activity increased at a steady pace of growth, according to the most recent survey by the Federal Reserve Bank of Richmond. Shipments rose, although new orders softened. Manufacturing employment firmed, and average wages increased sharply. The average workweek increased at about last month’s pace. Manufacturers’ expectations were generally for improved business conditions.” Doug Short had a good discussion of the Richmond Fed results at…
http://www.advisorperspectives.com/dshort/commentaries/Richmond-Fed-Manufacturing.phpRICHMOND FED (Advisor Perspectives)
“Fifth District manufacturing activity increased at a steady pace of growth, according to the most recent survey by the Federal Reserve Bank of Richmond. Shipments rose, although new orders softened. Manufacturing employment firmed, and average wages increased sharply. The average workweek increased at about last month’s pace. Manufacturers’ expectations were generally for improved business conditions.” Doug Short had a good discussion of the Richmond Fed results at…
GARTMAN BULLISH AGAIN (CNBC)
"Having called for a correction, I have been
abundantly wrong," Gartman said. A correction is typically defined as a
market downturn of 10 percent or more. "I am probably going to be wrong
continuing to expect one. It's best to err on the side of remaining quietly
bullish," he said. Last week, Gartman said the stock market is in the middle
of a correction and that there is "more selling to come." Story and Video at…
http://www.cnbc.com/id/101705149MARKET REPORT
Tuesday, the S&P 500 rose about 0.6% to 1912 (rounded).
VIX rose about 1.5% to 11.53.
VIX remains at a point that has recently aligned with the
start of corrections.
The yield on the 10-year Treasury Note fell again to 2.51%
at the close.
The Bond Ghouls are still worried.
The S&P 500 Index finally again closed above the prior high of 1897 and is sitting on the red trend line. Can it break above it? That’s another key for whether this bull still has legs.
The S&P 500 Index finally again closed above the prior high of 1897 and is sitting on the red trend line. Can it break above it? That’s another key for whether this bull still has legs.
Volume returned to normal today so it would seem that
Friday’s low volume was little more than pre-Holiday effect as traders left
early for the weekend.
STOCKS ABOVE THEIR 200-DAY MOVING AVERAGE (-dMA)
Our old friend stocks above their 200-dMA bounced up last week, but remains in a downtrend with lower highs and lower lows as of Friday’s close. This trend is one of the more important ones to watch to see which way this market is going: (1) continued new highs or (2) will it (finally) have that long awaited correction?
Our old friend stocks above their 200-dMA bounced up last week, but remains in a downtrend with lower highs and lower lows as of Friday’s close. This trend is one of the more important ones to watch to see which way this market is going: (1) continued new highs or (2) will it (finally) have that long awaited correction?
http://www.indexindicators.com/charts/nyse-vs-nyse-stocks-above-200d-sma-params-x-x-x-x/
MARKET INTERNALS (NYSE DATA)
The 10-day moving average of stocks advancing on the NYSE
fell to 54% at the close. (A number above
50% for the 10-day average is generally good news for the market.) New-highs
outpaced New-lows Tuesday. The spread
(new-highs minus new-lows) was +187. (It was +99 Friday.) The 10-day moving
average of change in the spread was +4. In
other words, over the last 10-days, on average, the spread has increased by 4 each
day. The smoothed 10-dMA of up-volume was UP today, but just barely. The internals turned neutral on the market
today, because the 10-day values for new-highs/new-lows aren’t strong enough. Internals are almost positive.
Market Internals are a decent trend-following analysis of current market action, but should not be used alone for short term trading. They are usually right, but they are often late. They are most useful when they diverge from the Index. In 2013, using these internals alone would have made a 16% return vs. 30% for the S&P 500 (in on Positive out on Negative – no shorting). Of course, few trend-following systems will do well in an extreme low-volatility, straight-up year like 2013.
NTSM
The NTSM analytical model for LONG-TERM MONEY remained
HOLD Tuesday. Sentiment fell to 80%-bulls
(5-dMA of {bulls/(bulls+bears)} for funds invested in selected Rydex/Guggenheim
funds at the close on FRIDAY. That’s a lot and reflects that traders using the
Rydex funds became less bullish on FRIDAY. (These are not professional traders
so they are a contrary indicator.) On a
statistical basis, Sentiment is now NEUTRAL.
Price, Volume & VIX indicators also remain neutral.
MY INVESTED POSITION
I increased my stock allocation to 50% invested in stocks on 26 March because of the NTSM indicators turned positive 24 Mar at the close. 50% in stocks is fully invested for me, given my age (semi-retired) and the risk inherent in today’s stock market. I am watching closely to see if it is time to reduce my long-term stock holdings.
--INDIVIDUAL VALUE STOCKS (New Feature)--
ENSCO (ESV): HOLD
The chart looks OK with higher lows, but I’d like to see some higher
highs before I recommend this stock again, although it was upgraded to Buy
today (27 May) by The Street.com. For my discussion see the NTSM blog at:
http://navigatethestockmarket.blogspot.com/2014/05/coppock-curve-says-stock-crash-nowblow.htmlMotley Fool suggests that the owners of floating rigs have overbuilt and rig-rentals and revenues will fall in the future. Commentary at…http://www.fool.com/investing/general/2014/05/13/these-offshore-drillers-have-made-a-big-mistake-2.aspx
ENSCO UPGRADED (The Street)
"Ensco (NYSE:ESV) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its revenue growth, expanding profit margins, good cash flow from operations, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel these strengths outweigh the fact that the company has had sub par growth in net income.” Story at…
http://www.thestreet.com/story/12721046/1/ensco-plc-stock-upgraded-esv.html?puc=yahoo&cm_ven=YAHOO"Ensco (NYSE:ESV) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its revenue growth, expanding profit margins, good cash flow from operations, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel these strengths outweigh the fact that the company has had sub par growth in net income.” Story at…
Research has shown that to have a diversified portfolio no one stock should be more than 4% of the portfolio total, or stated another way, if your total portfolio consisted of individual stocks, you would need at least 25-stocks to be “diversified.”
