“Retail sales barely budged in April, confounding projections for a small increase, figures from the Commerce Department showed Wednesday. That followed a 0.2 percent drop from January through March that marked the first quarterly decline in almost three years…’The economy needs to pick up steam for the Fed to be really satisfied that we’re leaving the weakness of the first quarter behind us,’ said Guy Berger, an economist at RBS Securities Inc. in Stamford, Connecticut…” Story at…
http://www.bloomberg.com/news/articles/2015-05-13/retail-sales-little-changed-as-americans-reluctant-to-splurge
CRUDE INVENTORIES
“Oil prices rose on Wednesday as U.S. crude stockpiles slipped for a second straight week, but traders and analysts said inventories were still hefty for this time of year and could undercut the market's advance.” Story at…
http://www.foxbusiness.com/markets/2015/05/13/crude-rises-as-us-stockpiles-fall/
MARKET REPORT
- Wednesday, the S&P 500 was down about 0.03% to 2098 (almost unchanged) at the close.
-VIX was down about 0.7% to 13.76.
-The yield on the 10-year Treasury Note rose to 2.29%. Art Cashin, Director of Floor Operations for UBS Financial Services and CNBC Commentator, said on CNBC that 2.3% seems to be the line in the sand for stocks, i.e., >2.3% on the 10-yr is trouble for stocks.
55% of stocks on the NYSE were up today (Advancers), but the S&P 500 declined. It is unusual to see the S&P 500 fall when the broader market is up. So, we can hope the S&P 500 will catch up tomorrow with an up-day. It would also be nice if the Internals will follow thru with some stronger numbers. It’s not a huge imbalance (55% advancers vs. 45% decliners), but this stalled market isn’t going to remain flat forever.
I remain cautiously optimistic, but there isn’t too much hard evidence for optimism except that the Index still remains about 0.5% above its 50-dMA.
MARKET INTERNALS (NYSE DATA)
The 10-day moving average of the percentage of stocks advancing (NYSE) rose to 47% at the close Wednesday. (A number below 50% is usually BAD news for the markets; but let’s be optimistic and see what happens tomorrow.) In a positive reversal, New-highs outpaced New-lows Wednesday. The spread (new-highs minus new-lows) was +19. (It was -32 Tuesday.) The 10-day moving average of change in the spread rose to zero. In other words, over the last 10-days, on average; the spread has remained unchanged.
Internals remained negative on the markets, but are improved.
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 2014, using these internals alone would have made a 9% return vs. 13% 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, nearly straight-up year like 2014.
NTSM
Wednesday, the NTSM analysis remained HOLD. PRICE is now 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, mostly 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) remains ahead of the S&P 500. Since 1 February it is 2.1% ahead of the S&P 500. Since 1 March the Euro-Pacific ETF (EFA) (“I”-fund) is 3.7% 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.)
