“Factory production in the U.S. unexpectedly declined in January by the most since May 2009, adding to evidence severe winter weather weighed on the economy. The 0.8 percent decrease at manufacturers followed a revised 0.3 percent gain the prior month that was weaker than initially reported…“Our assumption is that this is a temporary soft patch,” said Guy Berger, a U.S. economist at RBS Securities Inc. in Stamford Connecticut, who called for a 0.2 percent drop in factory output. “You’ve had pretty moderate growth in manufacturing, and I think in all likelihood that’s what’s going to repeat in 2014.” Story at…
http://www.bloomberg.com/news/2014-02-14/factory-production-in-u-s-fell-in-january-by-most-since-2009.html
MICHIGAN SENTIMENT (Advisor Perspectives)
“The University of Michigan Consumer Sentiment
preliminary number for February came in at 81.2, unchanged from the January
final. Today's reading was slightly above the Investing.com
forecast of 80.6. The index is off its 85.1 interim high set in July of last
year.” Anaysis and historical charts at Advisor Perspectives, dShort.com at… http://www.advisorperspectives.com/dshort/updates/Michigan-Consumer-Sentiment-Index.php
THE MARKET SHOULD FALL 10% - DOUG KASS (CNBC)
Doug Kass his sticking to his bearish guns, believing
that the stock market is overvalued by about 9 percent. The head of Seabreeze
Partners hedge fund has been staunchly negative on the stock market, even though betting against
Wall Street and its benefactors at the Federal Reserve
has been a losing strategy since the financial crisis ebbed. Earlier this week,
Kass issued a list of factors that he thinks argue against another year of big
gains. "With the global economic recovery and the bull market maturing, I
don't expect stocks to rise for the sixth consecutive year," he said in a
report for clients Tuesday.” Video and story at…http://www.cnbc.com/id/101415010
BANK OF AMERICA SAYS BUY (CNBC)
“MacNeil Curry, the head of global technical strategy at
Bank of America Merrill Lynch, was bearish on the S&P 500 going into 2014. But now he says
it's time to buy. "Up until
yesterday we had been bearish risk assets and the S&P 500," Curry said
in a Friday note. "Yesterday's close above 1,823 says that view is WRONG
and that the larger uptrend has resumed," he wrote.” Story at…http://www.cnbc.com/id/101418499
MARKET REPORT
Thursday, the S&P 500 was up 0.5% to 1839 (rounded).
VIX was down about 4% to 13.57. The yield on the 10-year Treasury Note rose to 2.74%.
MARKET INTERNALS (NYSE DATA)
The 10-day moving average of stocks advancing rose to 61%
at the close. (A number above 50% for
the 10-day average is generally good news for the market.) New-highs outpaced new-lows improved Friday, leaving
the spread (new-highs minus new-lows) at +129. (It was +121 Thursday). The 10-day moving
average of change in the spread was +16. In other words, over the last 10-days,
on average, the spread has increased by 16 each day. Up volume broke its down
trend last week and continues up.
NTSM
The NTSM system remained HOLD today, Friday. The first Sell signal of this cycle was just
over 2-weeks ago on 24 January. Sentiment, Price, Volume and VIX indicators are
all neutral, but continue to improve.
MY INVESTED POSITION
I am about 40% invested in stocks because I upped my
stock holdings by 10% on 12 February (S&P 500-1819) based on Market
Internal signals. This is a conservative
allocation, but putting a bit more into stocks recognizes that the market
internals are improving on the S&P 500 and the “correction” may once again
confound the bears. Can you say March?
I’ll reassess at the end of the month and add more or pull some out depending
on indicators.
