Jul 24 2014

The Current Market Environment

Market Recap:

Strong earnings drove stocks to new highs as Facebook shares soared on much better than forecast earnings. Shares of International Paper (IP), Yahoo (YHOO), and IBM (IBM) were also among market leaders. In spite of the positive earnings momentum and encouraging economic news, which showed jobless claims falling to a 9 year low, markets reversed course in the afternoon to close with small losses. Word that the Obama administration, one of Wall Street’s favorite ever, was working on a plan to close a tax loop hole that allowed companies to move their headquarters overseas and pay lower taxes – so called Corporate Inversion – unnerved some already jittery investors. We talked about the current market environment with MarketWatch Radio’s Chief Correspondent Larry Kofsky this morning – listen to the interview here:

Sectors of the S&P were mixed, with industrials underperforming and consumer staples outperforming.


Looking Ahead:

More earnings and economic news releases are on tap on Friday. Generally speaking, we continue to expect a relatively strong earnings season with continued positive economic news. However, as has been the case in the last few months, we expect markets to take a “two steps forward, one step back” trading pattern. The Durable Goods order report being released at 10:00 AM will be the most meaningful data point ahead of the weekend and next week deluge of economic releases.

Don’t forget to tune into Money Matters with Gary Goldberg this Saturday at 2 PM and Sunday at 11 AM to hear a great interview with S&P Capital IQ’s Sam Stovall, our latest economic analysis, and a discussion about why markets are trading at all-time highs, in spite of the current geopolitical turmoil in the world. Visit our website www.ggfs.com for details.

Jul 24 2014

Exceeding Earnings Expectation

Market Recap:

Stocks were mixed on Wednesday, as market participants weighed strong earnings against a slightly disappointing Mortgage Origination report. Boeing and Apple both impressed, helping drive the S&P 500 to a new record high. The Dow Jones did lose a small fraction of a percent as Consumer and telecom shares fell. Sectors of the S&P were mixed, with the aforementioned industrial sectors falling, and healthcare shares climbing most. The dollar strengthened against major currencies, while commodities were generally higher.


Looking Ahead:

AT&T reported weaker than forecast earnings on Wednesday afternoon, while Facebook had an impressive quarter. So far, about ¾ of the companies that reported have exceeded earnings expectation – a trend that will hopefully continue on Thursday as both earnings reports and economic data will be plentiful. Expect market participants to pay particular attention to Home Sales data, which is being released at 10:00 AM.

Make sure to tune into Money Matters with Gary Goldberg at 2:00 PM on Saturday afternoon, and 11:00 AM on Sunday to hear our complete economic analysis and market commentary. Visit our website www.ggfs.com for details.

Jul 23 2014

Stocks Rebound Tuesday

Market Recap:

Stocks rebounded on Tuesday, as strong earnings lifted investor’s spirits and fears of increasing violence between Israel and the Palestinian Territories as well as in the eastern region of Ukraine ebbed. The traditionally defensive Consumer Staples and Utilities sectors were the only losers for the day, with Technology, Energy and Health Care shares advancing most. Commodities were generally higher, while Treasuries sold off slightly on stronger than forecast economic data.


Looking Ahead:

Earnings continue to roll in on Wednesday, starting with PepsiCo which reported earnings ahead of expectations this morning. On the economic front, Mortgage applications rose more than expected, although mostly on refinancing activity as opposed to home purchases. As of 7:30 AM equity futures are pointing to a higher open, following international bourses which are generally higher.

Don’t forget to tune into Money Matters with Gary Goldberg on Saturday afternoon at 2, and Sunday morning at 11 to hear our complete economic analysis and market commentary, as well as a great interview with S&P Capital IQ’s Sam Stovall. Visit our website www.ggfs.com for details.

 

Jul 22 2014

Economic Data & Earnings Heat Up

Market Recap:

Global bourses sold off on Monday as investors grew more and more anxious over the violence in Gaza and the rising geopolitical tensions between the world and Russia after the downing of Malaysian Airlines Flight MH 17. The Dow fell as much as 130 points before rebounding to close with relatively minimal losses. Sectors of the S&P declined, while commodities generally strengthened and Treasuries rallied with the benchmark Ten-Year yield falling below 2.5%. So far, earnings have impressed investors, keeping a floor underneath an otherwise shaky market.


Looking Ahead:

Economic data and earnings heat up on Tuesday, with Japanese all Industrial Index and U.S. Consumer Prices being released before the open, followed by the U.S. Redbook report, Home prices, Existing Home Sales, and the Richmond Fed Manufacturing Index. On the earnings front, Altria (MO), Apple (APPL), The Coca Cola Co (KO), Harley Davidson (HOG), Kimberly Clark (KMB), McDonalds (MCD), Microsoft (MSFT), Prologis (PLD), United Tech (UTX) report earnings on Tuesday.

Make sure to tune into Money Matters with Gary Goldberg this Saturday at 2:00 PM and Sunday at 11:00 AM on WOR 710 AM Radio to hear our complete analysis of how the events in Ukraine and between Israel and the Palestinian territories will impact global markets, as well as a discussion on this and other critical subjects with S&P Capital IQ’s Sam Stovall. Visit our website www.ggfs.com for details.

Jul 21 2014

This Week’s Market Moving Events

Market Recap:

As we wrote and expected in the beginning of last week, market participants largely ignored geopolitical events and focused on earnings instead. However, the downing of Malaysian Airlines flight MH 17 by (apparently) Russian separatist in Ukraine may shift this dynamic over the coming days. More significantly from a market perspective, corporate earnings reports and earnings calls have been robust and positive so far, pushing stocks to new all-time highs.


Looking Ahead:

Earnings heat up for BJ’s, Mr. Softy, and HOG… while it will be a busy reporting week, there is also plenty of economic data to be digested. So far, markets have ignored geopolitical events, which I expect to continue over the coming week or two. However, I do expect market participants to tune into economic news more than they have in previous weeks. The “Be long or be wrong” moniker by market bulls may be running on thin air in the coming weeks. While a significant correction is unlikely, the air is getting thinner and prudent portfolio management rules indicate caution.


 

This Week’s Market Moving Events:

Monday: German PPI before the open, followed by the Chicago Fed National Activity Index. Halliburton (HAL) and Netflix (NTFX) report.

 

Tuesday: Japan all Industrial Index and U.S. Consumer Prices before the open, U.S. Redbook, Home prices, Existing Home Sales, and the Richmond Fed Manufacturing Index. Altria,, Apple (APPL), The Coca Cola Co (KO), Harley Davidson (HOG), Kimberly Clark (KMB), McDonalds (MCD), Microsoft (MSFT), Prologis (PLD), United Tech (UTX) report

 

Wednesday: Mortgage Applications, Eurozone Consumer Confidence, U.S. Petroleum Reserves, Chines Flash PMI Manufacturing and Japanese PMI (after 9:30 PM). ATT (T), Boeing (BA), Clear Channel home of our weekly radio show (CCO), Crown Castle International (CCI), Down Corning (DOW), Facebook (FB), Norfolk Southern (NFS) PepsiCo (PEP), and Tupperware (TUT) all

 

Thursday: Eurozone and German PMI, U.S. Jobless Claims and Consumer Comfort before the open, plus New Home Sales, Kansas City Fed Manufacturing Index, and Japanese CPI date are reported. 3M (MMM), Bristol Meyers Squibb (BMY) Caterpillar (CAT), Elli Lilly (ELY), Ford (F), General Motors (GM), Leggett & Platt (LEG), Raytheon (RTN) and Starbucks (SBUX) report earnings.

 

Friday:  TGIF (not the restaurant chain)…. U.S, Durable Goods at 8:30 AM and Tyco (TYC) report.

 

Make sure to tune into Money Matters with Gary Goldberg this Saturday and Sunday on WOR 710 AM Radio to hear our complete economic analysis and ongoing market commentary. Visit our website www.ggfs.com for details.

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