Monthly Archives: June 2015

Daily Market Update – June 2, 2015  (9:00 AM)

Last week was one that had absolutely no direction, although there wasn’t too much reason for it to have taken any direction from what few events were occurring.

If anything, the bias was to the downside, but that could be understood simply on the basis of the increasing weight of the market and with nothing obviously being recruited to help support that increasing weight.

This week has the same dearth of information and if this morning’s pre-open futures is going to be any indication of what may be ahead, there’s a reversal to yesterday’s very modest increase awaiting.

Just like last week the singular big economic news item won’t occur until Friday morning. That leaves time for lots of speculation and ambivalence.

Friday’s Employment Situation Report is in a position to confound markets if it is too good or worse than expected, especially after last week’s disappointing GDP data.

Just like last month, what would probably suit the market the best and lead to a positive feeling, would be an employment picture that’s just right in line with expectations.

If that’s the case that delays even having to think about when the FOMC will begin to increase interest rates. That essentially puts June off the table and maybe gets people to bypass September, getting us closer and closer to 2016.

For more than a year, ever since Janet Yellen became Chairman of the Federal Reserve we’ve been delaying the realization that an increase in interest rates is likely to be a positive thing for everyone. What people still think about are those days of red hot inflation and interest rate changes that couldn’t keep up with inflation.

While that’s certainly bound to happen sometime in the future, where is the reason to believe that it’s in our future?

Like so many things in life, sometimes it’s just much better to get it over with and move on with life. If the past is any indication, when that day comes and the market panics over that first in a series of interest rate increases, it will just as quickly recover in the realization that the economy is finally doing what an economy is supposed to do. People with jobs and the ability to spend money is a good thing.

With 3 new positions opened yesterday, all counting on their dividends, I don’t think that there will be too uch more to do this week as far as spending money goes.

After being in suspended animation last week, having even 3 trades seems like being on fire, but hopefully there’s more to be done during this week with existing positions.

The pre-opening futures aren’t giving too much confidence in that regard, but at least they are only very mildly lower, so anything is possible as the day unfolds.

Yesterday’s slow erosion of gains heading into the closing bell was disappointing, but it did put an end to 3 consecutive days of losses. The last of those days was based on the GDP report and could easily have had a lingering impact, but didn’t.

I look at that as a small positive in a sea of no positive news and all it ever takes is a spark.

As long as no one throws some cold water on things, the market is still within 1% of its recent all time high and could easily look to re-visit after a few days of resting while waiting for that spark.

Daily Market Update – June 1, 2015  (Close)

After a week of absolutely no direction and no theme, there’s not too much reason to believe that this week will be much different.

Other than on Friday, when the Employment Situation Report is released, there’s really not too much scheduled news and the market could find itself going back and forth as it did last week.

This week appeared to be getting ready to get off on the other foot, though, as the pre-open futures was pointing moderately higher. That follows a week where the bias was to the downside and then cemented there as the GDP Report was released on Friday.

This week’s Employment Situation Report could put the FOMC in an interesting position in the event that employment data is strong, as it was last month.

Somehow they would have to deal with conflicting pieces of economic information in deciding whether there is sufficient and valid enough data to make a decision to raise interest rates. With the GDP indicating that the economy was shrinking more than expected, but in the light of job growth, you would have to scratch your head in trying to understand how those would be occurring concurrently.

I’ll let them work that out while I think about other things.

Mostly, that will be the usual kind of things. The only difference is that after last week of no new trades and only a single position needing a rollover, it would really be nice to do something more meaningful this week.

While I would like to see the cash reserve pile grow even more, I would like to add some new positions this week to complement the 3 positions that are set to expire this week.

It was nice, at least for now, to have added some new positions, all three of which had dividends in the equation.  For now, I want dividends as an offset to risk.

While the early bias to start the week does look as if it will be higher, it’s still difficult to know what will be responsible for propelling markets higher. It’s also difficult to know just how the market will respond to news in general. Will they be disappointed by bad news, as was the case with last week’s GDP or would they be elated about bad news, as they would have responded about a month or so ago, to the very same news.

For the moment it appears as if the market is discounting a very small interest rate increase and is expressing disappointment with anything that might actually delay that increase. Last month the disappointment was if anything appeared to be accelerating that increase.

For its part, the bond market isn’t as effusive about rates going up sooner, rather than later, as it was just 2 weeks ago.

In essence, no one really has any clue as to what is next and how we will respond. But just to confuse things even more, the bond market returned to its belief that rates were heading higher and did so in a big way today.

This week, at least has a large number of ex-dividend positions to keep some income flowing in and in a small way maybe off-setting last week’s drought, but that represents passivity. Hopefully, there will be some good reason for actively pursuing some income and profits this week, without adding on too much risk in the process.

Daily Market Update – June 1, 2015  (8:30 AM)

After a week of absolutely no direction and no theme, there’s not too much reason to believe that this week will be much different.

The Week in Other than on Friday, when the Employment Situation Report is released, there’s really not too much scheduled news and the market could find itself going back and forth as it did last week.

This week appears to be getting ready to get off on the other foot, though, as the pre-open futures is pointing moderately higher. That follows a week where the bias was to the downside and then cemented there as the GDP Report was released on Friday.

This week’s Employment Situation Report could put the FOMC in an interesting position in the event that employment data is strong, as it was last month.

Somehow they would have to deal with conflicting pieces of economic information in deciding whether there is sufficient and valid enough data to make a decision to raise interest rates. With the GDP indicating that the economy was shrinking more than expected, but in the light of job growth, you would have to scratch your head in trying to understand how those would be occurring concurrently.

I’ll let them wotk that out while I think about other things.

Mostly, that will be the usual kind of things. The only difference is that after last week of no new trades and only a single position needing a rollover, it would really be nice to do something more meaningful this week.

While I would like to see the cash reserve pile grow even more, I would like to add some new positions this week to complement the 3 positions that are set to expire this week.

While the early bias to start the week does look as if it will be higher, it’s still difficult to know what will be responsible for propelling markets higher. It’s also difficult to know just how the market will respond to news in general. Will they be disappointed by bad news, as was the case with last week’s GDP or would they be elated about bad news, as they would have responded about a month or so ago, to the very same news.

For the moment it appears as if the market is discounting a very small interest rate increase and is expressing disappointment with anything that might actually delay that increase. Last month the disappointment was if anything appeared to be accelerating that increase.

For its part, the bond market isn’t as effusive about rates going up sooner, rather than later, as it was just 2 weeks ago.

In essence, no one really has any clue as to what is next and how we will respond.

This week, at least has a large number of ex-dividend positions to keep some income flowing in and in a small way maybe off-setting last week’s drought, but that represents passivity. Hopefully, there will be some good reason for actively pursuing some income and profits this week, without adding on too much risk in the process.