“The Federal Reserve lowered its economic outlook Wednesday after a harsh winter chilled the U.S economy's growth, reducing the odds for an initial interest rate hike as soon as the Fed's June meeting. In a statement after a two-day meeting the Fed gave no clear signal of when it plans to raise its benchmark interest rate for the first time since 2006 but policymakers have indicated they expect to act this year…Many economists say the Fed is unlikely to act until September at the earliest so it can assess whether the economy is regaining the momentum it had built last year.” Story at…
http://www.usatoday.com/story/money/2015/04/29/april-fed-meeting/26567511/
GDP STALLS OUT (WSJ)
“Gross domestic product, the broadest measure of goods and services produced across the economy, expanded at a 0.2% seasonally adjusted annual rate in the first quarter…’This is another quarterly number which confirms the long-term slow-growth thesis, but there are good odds we get a bit of a bounce later in the year from stabilized business spending and the housing markets, which are setting up quite promising,’ Guy LeBas, chief fixed-income strategist at Janney Montgomery Scott, said in a note to clients.” Story at…
http://www.wsj.com/articles/u-s-gdp-expands-at-0-2-pace-in-first-quarter-1430310699
CRUDE INVENTORY AND US PRODUCTION (Reuters)
“Oil prices hit the highest this year on Wednesday after the first crude stock draw in five months at the U.S. Cushing, Oklahoma hub suggested an oil glut may be starting to ease. Government data showing a smaller-than-expected rise last week in crude inventories throughout the United States also aided sentiment, although some traders felt the market was ignoring bearish elements like higher production.” Story at…
http://www.reuters.com/article/2015/04/29/us-markets-oil-idUSKBN0NK03420150429
MARKET REPORT
-Wednesday, the S&P 500 was down about 0.4% to 2107 at the close.
-VIX was up about 8% to 13.39.
-The yield on the 10-year Treasury Note rose to 2.04%.
CORRECTION WATCH
-The variability of market moves has dropped into the danger zone.
-As of Wednesday, there have been only 47 “up-days” in the last 100-days and that is less than 50%. So by that measure, a correction (if it were to start now) would be starting from a weak point. That might suggest a bigger down-turn. Perhaps we’ll finally get that 10% correction on a closing basis that has been so elusive. There are often dual interpretations though, and only 48 up-days in the last 100 can be seen a positive indicator too.
-RSI dropped to 56 (14-day, SMA) RSI has not given an overbought indication.
-I suspect any correction is weeks away.
MARKET INTERNALS (NYSE DATA)
The 10-day moving average of the percentage of stocks advancing (NYSE) fell to 49.5% at the close Wednesday. (A number below 50% is usually BAD news for the markets.) New-highs outpaced New-lows Wednesday. The spread (new-highs minus new-lows) was +21. (It was +40 Tuesday.) The 10-day moving average of change in the spread was minus-9. In other words, over the last 10-days, on average; the spread has declined by 9 each day.
Internals turned negative on the markets.
NTSM
Wednesday, the NTSM analysis remained HOLD. The PRICE indicator is positive. VOLUME, VIX and SENTIMENT indicators are neutral, although (as always) sentiment remains extremely high.
MY INVESTED STOCK POSITION
I remain fully invested at 50% invested in smaller cap-stocks
in the long-term portfolio with some international stocks. 50% is conservative,
but appropriate for a conservative retired guy.
The Dow Jones US Completion Index (all stocks except the S&P 500 – the “S” fund in the TSP) continues to outperform the S&P 500. Since 1 February it is 2.5% ahead of the S&P 500. The S&P 500 Index has gained during earnings season since earnings were not as bad as feared. Since 1 March the Euro-Pacific ETF (EFA) (“I”-fund) is 3.1% ahead of the S&P 500.
THRIFT SAVINGS PLAN (TSP) MEMBERS
My TSP Allocation: 50%-G; 10%-C; 25%-S; 15%-I. (50% cash is too high for non-retirees, however, the “G”-fund did return 2.2% over the last 12-months and that is exceptional for risk-free money.)
