“Initial claims for unemployment benefits, a measure of layoffs across the U.S., decreased 12,000 to a seasonally adjusted 267,000 in the week ended June 13…“Claims continue to signal strength, consistent with employment growth remaining more than strong enough to keep the unemployment rate trending down,” Jim O’Sullivan, chief U.S. economist at High Frequency Economics, said in a note to clients.” Story at…
http://www.wsj.com/articles/u-s-jobless-claims-fall-to-267-000-1434630775
PHILADELPHIA FEDERAL RESERVE INDEX RISES
“Manufacturing conditions in the region improved in June, according to a report by the Philadelphia Federal Reserve Bank released on Thursday. The broadest measure of manufacturing conditions increased from 6.7 in May to 15.2 in June.” Story at…
http://www.cnbc.com/id/102769767
LEADINGECONOMIC INDICATORS UP (RTT News)
“Confirming the outlook for more economic expansion in the second half of the year, the Conference Board released a report on Thursday showing another notable increase by its index of leading U.S. economic indicators. The Conference Board said its leading economic index climbed by 0.7 percent in May, matching the increase seen in April.” Story at…
http://www.rttnews.com/2513682/u-s-leading-economic-index-rises-more-than-expected-in-may.aspx
MARKET REPORT
- Thursday, the S&P 500 was up about 1% to 2121 at the close.
-VIX fell about 9% to 13.19.
-The yield on the 10-year Treasury Note rose to 2.35%.
The Russell 2000 made new highs today and there were more calls that the Russell was breaking out. That’s good news since the Russell might lead the S&P 500 out of its present stall.
Thursday’s big up-move exceeded statistical tests and would normally be followed by a down day about 62% of the time. Statistical analysis of price-volume action also shows a very calm market and that often leads to a break down, though this is not a crash signal. A couple percent down has been the norm in recent years.
Up-volume broke significantly higher today and that was a good sign.
Greece remains the wild card. There’s no point in reading too much about it since it is mostly conjecture.
Overall, there were mixed signals but I remain optimistic for the short run.
MARKET INTERNALS (NYSE DATA)
The 10-day moving average of the percentage of stocks advancing (NYSE) popped up to 49.9% at the close Thursday. (A number below 50% is usually BAD news for the markets.
In a positive reversal, New-highs outpaced New-lows Thursday. The spread (new-highs minus new-lows) was +70 (It was +17 Wednesday.) The 10-day moving average of change in the spread remained +12. In other words, over the last 10-days, on average; the spread has INCREASED by 12 each day.
Internals are negative on the market, but by the slimmest
margin. Only 49.9% of stocks have advanced over the past 10-days. If that were 50% or greater, Internals would
be positive on the market.
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
Thursday, the NTSM analysis remained HOLD. PRICE, 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 4% ahead of the S&P 500. Since 1 March the Euro-Pacific ETF (EFA) (“I”-fund) is 0.9% ahead of the S&P 500.
THRIFT SAVINGS PLAN (TSP) MEMBERS
My current TSP Allocation: 50%-G; 10%-C; 20%-S; 20%-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.)
