Category Archives: Daily Market Update

Daily Market Update – September 29, 2016 (7:30 AM)

Yesterday marked the fourth consecutive triple digit move.

After oil having made a large move lower on Tuesday and markets not following suit, yesterday was a completely different story.

For the most part the market completely ignored Janet Yellen’s appearance before Congress and instead it did nothing until an OPEC agreement came along to cut production.

At that moment, just as oil prices started their climb, the market went back to its pattern all through 2016, of simply following oil.

It did it again and rallied to that fourth consecutive triple digit move, once again taking the market higher.

The moves yesterday and on Tuesday higher erased the downward moves the prior 2 trading days.

That leaves the market ready to begin the morning with a GDP release and then the stream of Federal Reserve members coming through the day.

The week originally had 12 such appearances, but that had gone up to 17, with 6 of those, including Janet Yellen happening today.

So, it may be understandable why the futures markets are completely flat this morning.

It may be interesting to watch the numbers through the day at 8:30, 8:45, 10:00, 10:15, 1:30 and then seeing what further talks at 4:30 and 7:15  may do for tomorrow.

Originally this week, Janet Yellen was scheduled to be the last speaker from the Federal reserve, but that’s no longer the case, as today’s schedule has really been shuffled around and a speaker has now appeared on Friday, as well.

But it may be a busy day as the battle of words and thoughts gets underway.

There’s probably nothing to do but to try and not become collateral damage.

Daily Market Update – September 28, 2016 Close)

Yesterday marked the third consecutive triple digit move.

Even though at these levels a simple triple digit move doesn’t mean as much as it once did, they are still relative anomalies.

Yesterday was also another day where there wasn’t much reason for that triple digit move, unless you believe that the previous two moves lower just created an over-sold condition and that the market had no recourse but to bounce back.

That , of course, ignores past instances where more than 2 days of large losses have been followed by a third, maybe even a fourth day of large losses.

This morning, there was again nothing to really give markets an excuse for a large move.

The difference, at least early in the morning was that maybe today could have been the day that the market may actually not have made any big moves.

Logically, that could have been the case for today and tomorrow, as we waited for the GDP to be released on Friday.

Yesterday’s common sense, that is, the market not following oil lower, as there was word that there would not likely be a production cut, didn’t hold today.

In fact, the market turned higher, even as it was lulled to sleep with Janet Yellen’s congressional testimony, precisely when an agreement was reached to cut oil production.

Sure, it makes no sense for the market to respond positively to what kind only be bad news, but maybe any inflation is good inflation.

With a couple of positions set to expire this week, at this point I want to see them add to cash reserves.

That means assignment of the short calls and expiration of the short puts.

Both are possible, but I wouldn’t necessarily be upset if that’s not the case, as long as there is some reasonable opportunity to keep those positions alive and generating revenue.

When we get to the mid-week, I already start thinking about what the next week may hold, but this week, as it often is when there’s a big economic release on a Friday, such as with the GDP and the Employment Situation Report, I suspend those thoughts and await what Friday will bring.

I had wanted to see some pullback this week, but now would like to see some good GDP news, in the belief that will spur buying, as investors come to grips with an increasing likelihood of a rate increase in December.

As long as that increase doesn’t come as a surprise sometime sooner, I think that a flow of good economic news heading into the December FOMC meeting, particularly if also coupled with positive guidance as the next earnings season begins in a couple of weeks, could send us toward and beyond market highs.

I don’t have a kidney stone at the moment, but that’s one ride I’d like to go on as we head into 2017.

Daily Market Update – September 28, 2016 (7:30 AM)

Yesterday marked the third consecutive triple digit move.

Even though at these levels a simple triple digit move doesn’t mean as much as it once did, they are still relative anomalies.

Yesterday was also another day where there wasn’t much reason for that triple digit move, unless you believe that the previous two moves lower just created an over-sold condition and that the market had no recourse but to bounce back.

That , of course, ignores past instances where more than 2 days of large losses have been followed by a third, maybe even a fourth day of large losses.

This morning, there is again nothing to really give markets an excuse for a large move.

The difference may be that today the market may actually not make any big moves.

That may end up being the case for today and tomorrow, as we wait for the GDP to be released on Friday.

With a couple of positions set to expire this week, at this point I want to see them add to cash reserves.

That means assignment of the short calls and expiration of the short puts.

Both are possible, but I wouldn’t necessarily be upset if that’s not the case, as long as there is some reasonable opportunity to keep those positions alive and generating revenue.

When we get to the mid-week, I already start thinking about what the next week may hold, but this week, as it often is when there’s a big economic release on a Friday, such as with the GDP and the Employment Situation Report, I suspend those thoughts and await what Friday will bring.

I had wanted to see some pullback this week, but now would like to see some good GDP news, in the belief that will spur buying, as investors come to grips with an increasing likelihood of a rate increase in December.

As long as that increase doesn’t come as a surprise sometime sooner, I think that a flow of good economic news heading into the December FOMC meeting, particularly if also coupled with positive guidance as the next earnings season begins in a couple of weeks, could send us toward and beyond market highs.

I don’t have a kidney stone at the moment, but that’s one ride I’d like to go on as we head into 2017.

Daily Market Update – September 27, 2016 (Close)

Markets looked as if they were going to open on the calm side this morning after posting two consecutive triple digit losses for the first time since the Brexit vote.

There wasn’t much of a reason for either of the past two declining days, just as there’s not too much reason for any significant moves for the rest of the week, except perhaps Friday.

Of course, when there’s no reason, there’s reason to suspect just the opposite and that was again the case today, but this time in a different direction.

Today, it looked as if the markets may have taken their cue from Asian markets, but the buying accelerated as oil began falling, on news that it wasn’t too likely that anyone could agree on production cut backs.

That, at least, was nice to see.

Finally, a normal response to a supply side glut of oil.

With that done, maybe the market will gravitate toward calmness until Friday. That’s when the GDP is released and a surprising number could really move markets that are now expecting that there will be an interest rate increase in December. That would probably require some positive economic news and the GDP is a good place to start, especially if there are some upward revisions.

In the meantime, there are still lots of Federal reserve members set to speak this week and any of them has the power to move markets, even if only for a few hours until a counter-position is voiced.

With a purchase of shares yesterday that happened to be ex-dividend today, I don’t expect to be spending much more money this week, unless it looks as if I will be able to realize some new cash from those positions whose short option contracts expire this week.

There’s little reason to expect any sustained move higher while we await December, but with earnings about to start again in 2 weeks, it will be interesting to see whether or not companies are seeing anything hopeful ahead.

Any optimistic guidance would be welcomed enthusiastically by markets, as it has been a really long time since companies have pointed toward better times ahead.

With corporate earnings less buoyed by buybacks, sooner or later investors are going to demand earnings that are actually real earnings and those investors are very likely to reward real earnings improvements.

You would think that if the FOMC projects that the economy should be able to warrant a small increase in interest rates that there would be some good corporate earnings news ahead, as well.

But that still remains to be seen and I think that may still be another quarter into the future before companies start going out on a limb and say that the future looks better.

Daily Market Update – September 27, 2016 (7:30 AM)

Markets look as if they’re going to open on the calm side this morning after posting two consecutive triple digit losses for the first time since the Brexit vote.

There wasn’t much of a reason for either of the past two declining days, just as there’s not too much reason for any significant moves for the rest of the week, except perhaps Friday.

That’s when the GDP is released and a surprising number could really move markets that are now expecting that there will be an interest rate increase in December. That would probably require some positive economic news and the GDP is a good place to start, especially if there are some upward revisions.

In the meantime, there are still lots of Federal reserve members set to speak this week and any of them has the power to move markets, even if only for a few hours until a counter-position is voiced.

With a purchase of shares yesterday that happened to be ex-dividend today, I don’t expect to be spending much more money this week, unless it looks as if I will be able to realize some new cash from those positions whose short option contracts expire this week.

There’s little reason to expect any sustained move higher while we await December, but with earnings about to start again in 2 weeks, it will be interesting to see whether or not companies are seeing anything hopeful ahead.

Any optimistic guidance would be welcomed enthusiastically by markets, as it has been a really long time since companies have pointed toward better times ahead.

With corporate earnings less buoyed by buybacks, sooner or later investors are going to demand earnings that are actually real earnings and those investors are very likely to reward real earnings improvements.

You would think that if the FOMC projects that the economy should be able to warrant a small increase in interest rates that there would be some good corporate earnings news ahead, as well.

But that still remains to be seen and I think that may still be another quarter into the future before companies start going out on a limb and say that the future looks better.