“Factory production struggled to gain traction in October as automakers cut back for a third consecutive month, showing U.S. manufacturing was off to a slow start in the fourth quarter. The 0.2 percent increase in output matched September’s advance after it was revised down, figures from the Federal Reserve in Washington showed today. Total industrial production unexpectedly dropped 0.1 percent, reflecting the vehicle pullback and less demand at utilities, mining companies…The outlook “remains quite favorable,” said Millan Mulraine, deputy head of U.S. research and strategy at TD Securities USA LLC in New York…” Story at…
http://www.bloomberg.com/news/2014-11-17/industrial-production-in-u-s-unexpectedly-dropped-in-october.html
YEAR END RALLY (Financial Sense)
“The recent turbulence in the stock market is behind us and a rally is now underway. Given the fact that we have recently entered the most favorable 6-month period of the U.S. Presidential Cycle, it is our contention that Wall Street will advance quite sharply until spring.” Commentary at…http://www.financialsense.com/contributors/puru-saxena/year-end-rally
My cmt: Maybe, but it has been my experience that when everyone agrees the markets will do one thing; it does the opposite.
RESTAURANTS SUGGEST IMPROVING ECONOMY (MarketWatch)
“What do people do when times are getting better and they aren’t worried about losing their job? They go out to eat more. Well, consumers must be feeling better. They boosted spending at bars and restaurants in October for the sixth straight month. Outlays on dining out have risen by an annualized 9% in that span, the fastest gain in three years…Phil Orlando, chief equity strategist at Federated Investors, says the strong increase in back-to-school shopping in September foreshadows an equally good holiday season — they tend to go hand in hand. He predicts holiday sales will climb 4% to 4.5%, compared to a smaller 3% gain in 2013.” Story at…
http://www.marketwatch.com/story/growing-appetite-to-eat-out-indicative-of-improving-economy-2014-11-16
EARNINGS & REVENUES STILL DOING WELL (Factset)
“With 92% of the companies in the S&P 500 reporting actual results for Q3 to date, the percentage of companies reporting actual EPS above estimates (77%) is above historical averages, while the percentage of companies reporting actual sales above estimates (59%) is equal to historical averages.” – Excerpt from Factset Earnings Insight at…
http://www.factset.com/websitefiles/PDFs/earningsinsight/earningsinsight_11.14.14/view
MARKET REPORT
Monday, the S&P 500 was up 0.1% to 2041 (rounded).
VIX was Up about 5% to 13.99.
The yield on the 10-year Treasury Note rose to 2.34.
PULLBACK COMING
-RSI remains Overbought at a high value of 87.
-The S&P 500 Index remains 3.3% above the 50-dMA. That is a value that usually leads to some selling.
-The percentage of stocks above their 200-dMA remained 53% Friday (data is a day late) and that is below the mean value of 65% and is especially weak since the S&P 500 is at new highs.
-The Index has spent 6-days in the range of 2038-2041. This is reminiscent of the August 2014 pattern when there were 8-days at the top with only a 4-point range before the quick correction.
-Market Internals are deteriorating, but rather slowly. A pullback still looks likely. As always, timing is unknown, but it now looks like perhaps this week or next will see a downturn.
MARKET INTERNALS (NYSE DATA)
The 10-day moving average of the percentage of stocks advancing (NYSE) fell to 51% 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 +105. (It was +79 Friday). The 10-day moving average of change in the spread was minus-11. In other words, over the last 10-days, on average, the spread has declined by 11-each day. Internals remained neutral on the market. Only %-advancing (now above 50%) is keeping the internals positive.
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 remained neutral Monday. Only Price remains positive. Other indicators are neutral.
MY INVESTED STOCK
POSITION
I moved some funds back into the market on 17 October
2014 as a trade and increased my position
in stocks from 30% to about 40% overall.
I added more 20 Oct, to bring my stock investments up to 50%. I am
semi-retired, 50% is Fully-invested for me. I remain 50% invested in stocks.--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
Ensco price is going to reflect oil prices. If you think they are near a bottom, this is a great buy with high dividends. If not; it’s a dog.
