NEW HOME SALES DECLINE (Briefing.com)
“New home sales declined 14.5% in March…March sales were
the lowest since…July 2013…If sales are going to stay at their current level,
there could be a significant deceleration in housing starts as homebuilders
keep inventories from growing too fast.” Additional data and commentary at…http://www.briefing.com/Investor/Calendars/Economic/Releases/newhom.htm
HOUSING IN TROUBLE (STA Wealth Management)
“The current decline in housing is not a "weather
related" anomaly but a function of "real" affordability. I say "real"
affordability, because buying a house is not just about the price, but the
ability for a family to qualify for and pay the mortgage. Unfortunately,
despite the ever ebullient hopes of mainstream analysis, the core requirements
of rising wage growth, full-time employment, loan qualification and the ability
to save a downpayment keeps home ownership elusive for many. That is unlikely
to change anytime soon.” Commentary at
HOUSING COMMENTS
In the Financial Analysis Journal, Jesse Levin wrote in 1970 that the
best indicator for future stock prices in the National Bureau of Economic
Research Leading Indicators was new-home permits. So housing is likely to influence many
investors. Indeed, the market is down since the housing news came out on
Wednesday, but it’s always hard to know what other influences are at work.
CYBER SAFETY - DON’T ASSUME YOU’RE SAFE FROM THE HEARTBLEED BUG (CNN/Money)
“In the post-Heartbleed world, assume your online communication isn't secure unless proven otherwise. It sounds alarmist, but it's true. Email, social media, banking -- all of it is at risk…All you can do is change your passwords often -- all of them -- and update your software to the latest version. And don't trust any app, device, computer environment or website until those in charge specifically say they've patched the problem.” Story at…
http://money.cnn.com/2014/04/24/technology/security/heartbleed-security/index.html?iid=HP_LN
MARKET REPORT
Friday, the S&P 500 was DOWN about 0.8% to 1863 (rounded).
VIX was UP about 5.6% to 14.06.
The yield on the 10-year Treasury Note fell slightly to 2.67% at the close.
The Bond Ghouls continue their concerns about the stock market.
Repeating from yesterday: The S&P 500 has closed in the vicinity of 1880 about 8 to 10 times since 31 December. The index has only closed above 1880 3-times and then only about ½-% higher. It needs to punch higher or the correction will be back.
MARKET INTERNALS (NYSE DATA)
The 10-day moving average of stocks advancing on the NYSE
increased to 56% at the close. (A number
above 50% for the 10-day average is generally good news for the market.) New-highs
outpaced new-lows Wednesday. The spread
(new-highs minus new-lows was +35. (It
was +111 Thursday.) The 10-day moving average of change in the spread was flat.
In other words, over the last 10-days,
on average, the spread has remained the same each day. The smoothed 10-dMA of
up-volume was falling. The internals remained
neutral on the market.
The NTSM analytical model for LONG-TERM MONEY remained HOLD Friday. Sentiment climbed to 78%-bulls (5-dMA of {bulls/(bulls+bears)} for funds invested in selected Rydex/Guggenheim funds. This is a very high number, but on a statistical basis Sentiment is now neutral. The VIX, Price & Volume indicators are all neutral.
I increased my stock allocation to 50% invested in stocks on 26 March because of the NTSM indicators turned positive Monday (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.
