“Solid U.S. jobs and service sector data on Thursday bolstered views the Federal Reserve could start slowing its bond-buying program as soon as this month, but plunging orders for factory goods highlighted uncertainty around the economic outlook…The Institute for Supply Management (ISM) said its services index rose to 58.6, its highest since December 2005, from 56 in July. The reading handily topped economists' consensus expectations for 55 and beat the high end of forecasts. "Services represent approximately 85 percent of the economy, so the continued expansion of the sector is critical for the continuation of the overall economy recovery," wrote Thomas Simons, a money market economist at Jefferies & Co in New York, in a note to clients.
…In addition, U.S. private employers added 176,000 jobs in August, and new jobless claims last week fell to a near five-year low.” Story at…
http://www.reuters.com/article/2013/09/05/us-jobless-claims-idUSBRE9840HW20130905
ART CASHIN (CNBC)
“…the traders are concerned the area between 2.95 and 3%
(on the 10-year treasury) may be a trip wire. It used to be closer to the 2.91,
but we're inching up. I think we're very close to it. If it hits, it will be
interesting to see if it causes the bids to disappear in equity.” Video at…http://video.cnbc.com/gallery/?play=1&video=3000196918
Then later on CNBC…
“Cashin, UBS' director of floor operations at the NYSE,
told CNBC's Mary Thompson that if the yield hits 3 percent it could hurt the
housing market. "If we get close to
it, I would expect to see bids canceled as we did earlier today." If too
many bids get canceled, that could cause an ‘air pocket.’" CNBC video at…http://www.cnbc.com/id/101012170
OFF TOPIC: THE SYRIAN WAR
SENATOR JOHNSON: PRESIDENT HAS BACKED US INTO A CORNER
(CNBC)“After a hearing on Syria that lasted more than three hours Tuesday, Sen. Ron Johnson says he didn't get an answer on what he perceives as the biggest threat to U.S. national security interests…’If the result of our action really was the fall of the Assad regime, are they prepared to do what's necessary to make sure that those chemical weapons don't fall into the hands of al Qaeda- backed rebels?’ Johnson asked. ‘I didn't get that answer.’" Story at…
http://www.cnbc.com/id/101006178
MARKET REPORT
Thursday, the S&P was up 0.1% to 1655 (rounded) at the close, but the index had been higher; after 3PM it gave up most of its gains as the Pros sold.
VIX was down 0.7% to 15.77.Thursday, the S&P was up 0.1% to 1655 (rounded) at the close, but the index had been higher; after 3PM it gave up most of its gains as the Pros sold.
The S&P 500 is still hanging ‘round its 50-day moving average (now 0.6%
below it) so it looks like the crowd is waiting. Perhaps the market reaction to jobs data
tomorrow will give some clues about where the crowd wants to go. Market internals suggest up.
MARKET INTERNALS (NYSE DATA)
The 10-day moving average of stocks
advancing on the NYSE rose to 54% at the close Thursday, but Breadth was down
on the day with 47% of stocks advancing.
(A number above 50% for the 10-day average is generally good news for
the market.)
New-highs outpaced new-lows today leaving
the spread at +53 (it was +33 Wednesday), with the 10-day moving average of
change in spread still positive, but trending down.
The Internals are positive on the market,
but I remain UNCONVINCED we are
out of the woods.
NTSM
Thursday, the overall NTSM analysis was HOLD
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.
