“The number of Americans filing new claims for unemployment benefits rose for a second straight week last week, but remained at levels consistent with a firming labor market. Initial claims for state unemployment benefits increased 3,000 to a seasonally adjusted 287,000 for the week ended Oct. 25…” Story at…
http://www.reuters.com/article/2014/10/30/us-usa-economy-unemployment-idUSKBN0IJ1GY20141030
GDP UP 3.5% IN 3RD QUARTER (Bloomberg)
“The economy in the U.S. expanded more than forecast in the third quarter, capping its strongest six months in more than a decade…Gross domestic product grew at a 3.5 percent annualized rate in the three months ended September after a 4.6 percent gain in the second quarter…” Story at...
http://www.bloomberg.com/news/2014-10-30/economy-in-u-s-grew-3-5-in-third-quarter-more-than-forecast.html
NATIONAL DEBT
Unfortunately, a lot of the gain in GDP was due to Government spending increases. The National debt is now roughly 18-trillion dollars or about 60,000 for every citizen. For every person paying taxes (including those who only pay into social security thru payroll taxes) this works out to be about 150,000 per person (17T/122M). If only income taxpayers are included, it is about 210,000 each (17T/85M). Why is this worrisome?
“..the U.S. government borrows about 42 cents of every dollar it spends. And approximately $1 out of every $4 dollars that it borrows goes to pay just the interest on the national debt. (http://www.debt.org/government/) As interest rates rise, servicing the debt will become a greater drag on the economy and will eventually squeeze out other spending. This is a coming crisis. I have no clue about when, but neither the Tax-and-spend Democrats, nor the Cut-Tax-and-Spend Republicans seem to have a clue about avoiding it.
MARKET INTERNALS (NYSE DATA)
The 10-day moving average of the percentage of stocks advancing (NYSE) remained 63% at the close Thursday. (A number above 50% is usually good news for the markets.) New-highs outpaced New-lows Thursday. The spread (new-highs minus new-lows) was +144. (It was +136 Wednesday). The 10-day moving average of change in the spread was +26. In other words, over the last 10-days, on average, the spread has increased by 26 each day. Internals remained neutral on the market, because the smoothed 10-dMA of up-volume is falling.
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 long-term NTSM system analysis dropped to HOLD Thursday. Volume indicator is positive. Others indicators are neutral.
MY INVESTED STOCK POSITION
I moved some funds back into the market on Friday, 17 October 2014 as a trade and increased my position in stocks from 30% to about 40% overall. I added more Monday, 20 Oct, to bring my stock investments up to 50%. This move was based on my comments 16 Oct that a Tradable bottom had been set. It appears that this will be a durable bottom and not just a trade. Either way, since I am semi-retired, 50% is Fully-invested for me.
--INDIVIDUAL STOCKS FROM A VALUE HOUND--
ENSCO (ESV): BUY?
The chart looks good and oil prices are close to a bottom so I think Ensco is again a Buy. See related video on this page…
http://finance.yahoo.com/q?s=esv&ql=1
Discussion on oil prices on CNBC were all over the place Monday, from $80 to $65. It reminds me of 2007 when there were experts on CNBC predicting $10/gallon gas.
BARRONS ON ENSCO
“Ensco reported adjusted EPS of $1.87 in the quarter, above our $1.67 estimate and consensus of $1.61. The beat was driven by both higher-than-expected revenues as the company likely earned more bonus payments than anticipated. Lower-than-expected costs also contributed, as the company was successful in containing cost inflation in the quarter.” From…
http://blogs.barrons.com/stockstowatchtoday/2014/10/30/ensco-noble-buck-offshore-driller-weakness-as-earnings-surprise-to-the-upside/?mod=yahoobarrons&ru=yahoo
