Daily Market Update – January 12, 2016 (Close)

 

 

 

Daily Market Update -January 12, 2016 (Close)

Yesterday morning’s futures offered some promise even as China plunged another 5% and as oil was taking its biggest one day hit in quite a while.

As long as the market continues its odd relationship with the price of oil, that should have been a potent one – two punch, but the futures yesterday morning held dome promise.

Those futures weren’t pointing toward any meaningful kind of rebound, but at least they were showing some strength.

That strength did deteriorate during the latter phases of the futures session and at mid-day there was a substantial loss, but the market did recover and closed near its highs.

The gains yesterday were a little narrow and the S&P 500 was flat, as the DJIA showed that gain, but still, based on the first week of 2016, even flat was good.

This morning again showed some optimism as the early futures were trading, but as with yesterday, the strength was lessening as we got closer to the opening bell.

The difference was that they started a comeback before the opening bell and then continued that comeback to the point that the DJIA was up nearly 200 points before losing it all and another 70 points, until turning it all around again at about 2 PM.

We haven’t had a day like today in a while.

With so many positions set to expire this week, I would have loved to have seen some sustained strength today and even more as we approach Friday, if only to be able to have a chance to get some rollovers done.

I wasn’t not looking for any bargains this morning and as is usually the case, as each passing day hits the books, I’m less inclined to open a new position expiring that week, although the higher volatility can offer what we used to take as a week’s worth of premium, now in only 4 days.

That was the case today, as I finally opened a new position after it looked to be too good at its price and offered a good premium for just 4 days and another $0.27 in share upside, as well.

But as has been the case lately, we’ll just have to see whether it works out according to plan, because predictability hasn’t been the way things have behaved lately.

With no real news yesterday and not much this week, other than perhaps the JOLTS and then the beginning of earnings season tonight, hopefully all of the surprises in store for 2016 already happened last week.

I know that’s not going to be the case, but 2016 got off to a rocky start as far as international news goes and that didn’t help things in our market that was already spooked by two 7% day declines in Shanghai.

Just to show how that’s not going to be the case, there came the news that Iran seized to US naval vessels and was holding 10 sailors.

So we’ll see.

We’ll see.

This morning’s early gains and the later gains didn’t have too much behind them other than perhaps selling weariness, so it’s going to be hard to take the strength as really being reflective of anything.

With the consensus being that earnings this quarter are going to be the second consecutive one of decreasing revenues and earnings, any good news could be the catalyst for a strong jump higher as the momentum has definitely turned negative.

As that turn has gone negative, there are also sectors that are in bear territory and not just energy and materials.

At some point, value investors do come in and they do so in a meaningful way when they think an inflection is upcoming or just been passed.

Nothing would do the trick to get them back in at this point than what has been missing from the market for about 7 years and that’s fundamental growth in revenues and earnings.

For the longest time earnings have been artificially inflated by stock buybacks and we may not be re-entering a phase when those earnings are going to be less and less helped out by shrinking the share base.

Having real earnings would be a great thing and could be just what’s needed to restore some health to energy, materials and commodities.

A little inflationary movement would be a very good thing and during those early phases the stock market’s moves are usually leveraged by economic growth.

We’re still waiting for that kind of growth to become obvious.

I know I am.


Daily Market Update – January 12, 2016

 

 

 

Daily Market Update -January 12, 2016 (8:00 AM)

Yesterday morning’s futures offered some promise even as China plunged another 5% and as oil was taking its biggest one day hit in quite a while.

As long as the market continues its odd relationship with the price of oil, that should have been a potent one – two punch, but the futures yesterday morning held dome promise.

Those futures weren’t pointing toward any meaningful kind of rebound, but at least they were showing some strength.

That strength did deteriorate during the latter phases of the futures session and at mid-day there was a substantial loss, but the market did recover and closed near its highs.

The gains yesterday were a little narrow and the S&P 500 was flat, as the DJIA showed that gain, but still, based on the first week of 2016, even flat was good.

This morning again shows some optimism as the early futures are trading, but as with yesterday, the strength is lessening as we get closer to the opening bell.

With so many positions set to expire this week, I would love to see some strength as we approach Friday, if only to be able to have a chance to get some rollovers done.

I’m not looking for any bargains at the moment and as is usually the case, as each passing day hits the books, I’m less inclined to open a new position expiring that week, although the higher volatility can offer what we used to take as a week’s worth of premium, now in only 4 days.

With no real news yesterday and not much this week, other than perhaps the JOLTS and then the beginning of earnings season tonight, hopefully all of the surprises in store for 2016 already happened last week.

I know that’s not going to be the case, but 2016 got off to a rocky start as far as international news goes and that didn’t help things in our market that was already spooked by two 7% day declines in Shanghai.

This morning’s early gains don’t have too much behind them other than perhaps selling weariness, so it’s going to be hard to take the early strength as really being reflective of anything.

With the consensus being that earnings this quarter are going to be the second consecutive one of decreasing revenues and earnings, any good news could be the catalyst for a strong jump higher as the momentum has definitely turned negative.

As that turn has gone negative, there are also sectors that are in bear territory and not just energy and materials.

At some point, value investors do come in and they do so in a meaningful way when they think an inflection is upcoming or just been passed.

Nothing would do the trick to get them back in at this point than what has been missing from the market for about 7 years and that’s fundamental growth in revenues and earnings.

For the longest time earnings have been artificially inflated by stock buybacks and we may not be re-entering a phase when those earnings are going to be less and less helped out by shrinking the share base.

Having real earnings would be a great thing and could be just what’s needed to restore some health to energy, materials and commodities.

A little inflationary movement would be a very good thing and during those early phases the stock market’s moves are usually leveraged by economic growth.

We’re still waiting for that kind of growth to become obvious.

I know I am.


Daily Market Update – January 11, 2016 (Close)

 

 

 

Daily Market Update -January 11, 2016 (Close)

Last week it was a story of Saudi Arabia and Iran not playing too nicely with one another.

It was also a story of North Korea perhaps setting off a Hydrogen bomb.

But mostly it was the same old story that we had first started seeing and hearing about the Chinese stock markets back in June and July of last year.

Eventually, the meltdown of the Shanghai market about 6 months ago probably led to our precipitous decline and first real market 10% correction in years.

This week, the second week of 2016, begins with a continuation of weakness in China, but after two 7% declines last week, last night’s 5% decline seems fairly trivial.

Maybe that’s what our early futures traders thought, as well, but that early strength was really muted, as oil also continued its steep decline.

Without any real hint of a bounce last week, other than a little final hour buying on two of those trading days, the market fell about 6% and is actually fairly close to another of those 10% corrections from the high reached just barely a month ago, at which point the market had nearly recovered everything lost in August 2015.

With the dual punch of China and continued weakness in oil, it’s hard to imagine what could take markets meaningfully higher, other than some really spectacular earnings news.

Since no one is really expecting that, if it does occur, especially if the banking sector gets things started nicely, the move higher could be very swift.

It’s still probably not too likely, though.

With this being the final week of the January 2016 option and having a lot of positions set to expire that were knocked down hard last week along with everyone else, I would love to have the opportunity to roll those over.

But, that may be difficult.

With volatility high, however, there may be reason to then look at capitalizing at that phenomenon by again considering some longer term expiration dates.

Ultimately, any additional income is better than no additional income, even if it may mean waiting and waiting.

It’s a little bit easier to do that if there are dividends while waiting, as most of this week’s scheduled expiring stocks have, but still, it’s a frustrating predicament.

With a little bit of cash to spend, I don’t feel any particular need to make the pile even smaller, unless something really looks spectacular, but there have been many head fakes along the way over the past 6 months.

Today was mostly a day of nothingness. At least in terms of net gain.

To its credit the market did bounce well off of its lows and did finish near its highs.

So that’s good.

But not good enough to do much other than to watch.

The likelihood is that if doing anything, at all,  will focus on either dividends or the same recurrent trades in companies that have been the case for the past 4 months or so, as they are also, buy and large, lower from where their most recent sequence of purchases began.

In a market like this I don’t mind serial purchasing of the same positions, but sometimes the market takes those stocks more than ever imagined down a path that you never imagined.

Almost, but still not the case today, but let’s see what tomorrow brings


Daily Market Update – January 11, 2016

 

 

 

Daily Market Update -January 11, 2016 (9:00 AM)

Last week it was a story of Saudi Arabia and Iran not playing too nicely with one another.

It was also a story of North Korea perhaps setting off a Hydrogen bomb.

But mostly it was the same old story that we had first started seeing and hearing about the Chinese stock markets back in June and July of last year.

Eventually, the meltdown of the Shanghai market about 6 months ago probably led to our precipitous decline and first real market 10% correction in years.

This week, the second week of 2016, begins with a continuation of weakness in China, but after two 7% declines last week, last night’s 5% decline seems fairly trivial.

Maybe that’s what our early futures traders thought, as well, but that early strength was really muted, as oil also continued its steep decline.

Without any real hint of a bounce last week, other than a little final hour buying on two of those trading days, the market fell about 6% and is actually fairly close to another of those 10% corrections from the high reached just barely a month ago, at which point the market had nearly recovered everything lost in August 2015.

With the dual punch of China and continued weakness in oil, it’s hard to imagine what could take markets meaningfully higher, other than some really spectacular earnings news.

Since no one is really expecting that, if it does occur, especially if the banking sector gets things started nicely, the move higher could be very swift.

It’s still probably not too likely, though.

With this being the final week of the January 2016 option and having a lot of positions set to expire that were knocked down hard last week along with everyone else, I would love to have the opportunity to roll those over.

But, that may be difficult.

With volatility high, however, there may be reason to then look at capitalizing at that phenomenon by again considering some longer term expiration dates.

Ultimately, any additional income is better than no additional income, even if it may mean waiting and waiting.

It’s a little bit easier to do that if there are dividends while waiting, as most of this week’s scheduled expiring stocks have, but still, it’s a frustrating predicament.

With a little bit of cash to spend, I don’t feel any particular need to make the pile even smaller, unless something really looks spectacular, but there have been many head fakes along the way over the past 6 months.

The likelihood is that I will focus on either dividends or the same recurrent trades in companies that have been the case for the past 4 months or so, as they are also, buy and large, lower from where their most recent sequence of purchases began.

In a market like this I don’t mind serial purchasing of the same positions, but sometimes the market takes those stocks more than ever imagined down a path that you never imagined.


Dashboard – January 11 -15, 2016

 

 

 

 

 

SELECTIONS

MONDAY:   Shanghai down another 5% and oil tanking even further. Welcome to the second week of 2016 as earnings season starts and skepticism over last week’s Employment Situation Report reigns

TUESDAY:   Yesterday started with promise, but didn’t deliver with much. Today, the start may be the same today, but as yesterday, the strength is dissipating as the opening bells comes closer.

WEDNESDAY:  Yesterday’s give back of the initial strong gain at the opening was discouraging, but the nice come back in the final 2 hours of trading was encouraging. This morning’s futures shows a possibility of some continuation of the closing gain. Last week, late session buying had no follow through, at all, so there’s hope for something different today.

THURSDAY:  Not quite a washout yesterday, but the market is again officially in correction territory, down about 7.5% in just 8 trading days in 2016. Futures aren’t looking to make any of that back this morning.

FRIDAY:. A brief moment of optimism yestedray, looks like it will be erased today, as the futures are again plunging, amid the realization that yesterday’s climb was no where close to being enough.

 

 

 

 

 



 

                                                                                                                                           

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