"…the outlook for consumption over the remainder of this year looks good," said Paul Ashworth, chief U.S. economist at Capital Economis in Toronto…
…The Commerce Department said on Monday that consumer spending edged up 0.1 percent after dropping 0.2 percent in January...
…Excluding food and energy, prices edged up 0.1 percent after a similar gain in January. The so-called core PCE price index increased 1.4 percent in the 12 months through February.” Story at…
http://www.foxbusiness.com/economy-policy/2015/03/30/personal-spending-income-rise-in-february/
DREARY REPORTING SEASON AHEAD (Marketwatch)
”Health care and financial earnings are looking to be
some of the relatively few bright spots in what promises to be a dreary
reporting season.” Story at…Basically earnings estimates are negative for the first AND second quarter. It’s the weather again? It worked last year…we’ll see.
MARKET REPORT
-Monday, the S&P 500 was up about 1.2% to 2086 at the close.
-VIX was down about 4% to 14.51.
-The yield on the 10-year Treasury Note crept up to 1.95%.
Monday’s move was greater than 1% up, but it still didn’t reach my requirements for a statistically significant day (in price and volume). That just means this indicator doesn't say the markets can’t go higher Tuesday. Actually, I expect the markets to make it back to prior highs. At that point let’s hope it can breakout to NEW highs.
CORRECTION OVER?
Yes. See Friday’s blog.
MARKET INTERNALS (NYSE DATA)
The 10-day moving average of the percentage of stocks advancing (NYSE) rose to 55% at the close Monday. (A number above 50% is usually GOOD news for the markets.) New-highs outpaced New-lows Monday. The spread (new-highs minus new-lows) was +128. (It was +21 Friday.) The 10-day moving average of change in the spread was +7. In other words, over the last 10-days, on average; the spread has INCREASED by 7-each day.
Internals remained NEUTRAL on the market, but they improved again and would have been positive if the up-volume had been higher.
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 2014, using these internals alone would have made a 9% return vs. 13% 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, nearly straight-up year like 2014.
Monday, the NTSM analysis switched to BUY. The PRICE and VIX indicators are positive. VOLUME and SENTIMENT indicators are neutral, although (as always) sentiment remains extremely high. This means market conditions are now generally favorable; but the important BUY was last October after the low.
MY INVESTED STOCK POSITION
I remain fully invested at 50% invested in smaller cap-stocks
in the long-term portfolio with some international stocks. 50% is conservative,
but appropriate for a conservative retired guy.
The Dow Jones US Completion Index (all stocks except the S&P 500) continues to outperform the S&P 500. Since February it is 4% ahead of the S&P 500.
