May 22 2015

Bad news once again turns into good news

5/21/15 Market Recap:

Equities finished with modest gains yesterday as bad news once again turned into good news for the markets. Existing home sales disappointed, falling by 3.3%, and jobless claims rose more than expected but these economic data points lead to the belief that the Fed will continued its dovish stance regarding interest rates. With the first quarter earnings season nearly over and no other major market moving catalysts to drive trading, trading participation has been muted in recent sessions even as the averages continue to push against record levels. According to the Wall Street Journal, yesterday’s essentially flat close for the Dow marked the fifth consecutive day that the average has moved less than .15% in either direction, its longest such streak since 2006. The Nasdaq led all averages with a gain of .38% yesterday while the Russell was the sole decliner, finishing slightly below the neutral line. S&P sectors were primarily positive as well with seven of the ten sectors finishing higher. A rally in oil prices pushed energy stocks higher, the best sector performer with gains of .84%.

Looking Ahead:

Futures are moving marginally this morning ahead of the last trading day before the Memorial Day Weekend, the unofficial start of the summer season. Though most foresee light trading activity heading into the weekend, traders are still anticipating the release of April consumer price index data and a speech by Fed Chair Janet Yellen regarding Wednesday’s FOMC minutes at 1pm. Neither event however, is expected to bring any major surprises to the table. Make sure to listen to Money Matters with Gary Goldberg this Sunday at 11:00 AM on WOR 710 AM Radio to hear our latest economic and market analysis.   This week Gary’s guest are actor Joe Montagne discussing the true meaning of Memorial Day and Wegman’s executive chef Cindy Growman giving some great tips on grilling. Visit our website for details.

May 21 2015

Investors continue to consider yesterday’s April FOMC meeting minutes

05/20/15 Market Recap:

In what has been a common occurrence over the past few trading sessions, traders stayed primarily on the sidelines with the markets never straying too far from the neutral line. The major averages, hovering near record levels, closed mixed with either marginal gains or marginal losses. Even the Fed minutes, released during the afternoon, inspired nothing more than a short positive burst but did little to spur trading significantly in that direction. As expected, the minutes offered no significant deviation from the Fed’s ongoing message regarding data-dependency and generally agreed that the first quarter slowdown was due to temporary factors such as the west coast port strikes and harsh winter weather. The Fed, in its most explicit terms yet, argued against a June hike saying that it was “unlikely that June economic data would provide enough confirmation that the conditions for raising the target range for the federal funds rate had been satisfied” but stopped short from completely ruling out a near term hike. Sector performance during the session was equally mixed with gains and losses split equally between the ten S&P sectors. Telecom led all sectors with gains of .47% while Financials and Industrials lagged the most.  

Looking Ahead:

Markets are pointing to a slightly lower open this morning as investors continue to consider yesterday’s April FOMC meeting minutes. On tap for today, along with notable earnings releases from Hewlett Packard (HPQ) and Best Buy (BBY), is arguably the week’s busiest stream of econ data with jobless claims, flash manufacturing PMI, and existing home sales expected. Existing home sales, in particular, will be closely watched after Tuesday’s housing starts data pointed to the highest levels of new residential construction in more than seven years. Market participants are hoping for signs of a 2nd quarter rebound and growth in housing activity would certainly point to that. Make sure to listen to Money Matters with Gary Goldberg this Sunday at 11:00 AM on WOR 710 AM Radio to hear our latest economic and market analysis.  This week Gary’s guest is actor Joe Montagne.  Visit our website for details. 



May 20 2015

Markets are moving marginally higher

Market Recap 051915:

It was another light trading day in the market as investors continue to weigh evidence of a recovering US economy against the inevitability of a rate hike. Positive economic news, signaling a pick up from disappointing 1Q numbers, cause investors to worry that a rate hike could come quicker while poor economic news point to fears that the 1Q slowdown could spill into the current quarter. However, a continuing stagnation would force the Fed to kick the rate hike further down the road. It is clear that at this juncture, investors aren’t sure what scenario they favor. This uncertainty is leading to vacillation in the markets even as the averages continue to test and surpass record highs. The Dow notched another record close in yesterday’s session despite rising by only .07%, while the other major averages closed with marginal losses. Among the sectors, Financials and Healthcare led the way for the second consecutive day while Energy and Telecom stocks lagged. The dollar meanwhile recorded its best day against the Euro in over two months, rising by 1.5%, after news that the ECB planned to frontload bond purchases of its QE program during May and June in anticipation of decreasing liquidity in the summer months. 

Looking Ahead:

Markets are moving marginally higher this morning as investors eagerly await the release of the minutes from the FOMC’s April meeting. With no major economic data in the docket, the minutes, which will be released this afternoon, will be parsed for more insight on Fed thinking. Though investors shouldn’t expect a clear indication of when the rate will take place, the Fed’s outlook and overall assessment of the current state of the US economy hold significant importance. Aside from the release of the minutes, investors also have another round of retailer earnings to digest today with Target (TGT) and Lowes (LOW) reporting among other. In overnight trading, the Treasuries are moving slightly higher while the dollar is continues its recent rally versus the euro.

Make sure to listen to Money Matters with Gary Goldberg this Sunday at 11:00 AM on WOR 710 AM Radio to hear our latest economic and market analysis. Visit our website for details. 


May 19 2015

Dollar Taking Back Some Ground

Market Recap 051815:

Despite beginning the day in the red, markets ended the day on a positive note with all major averages registering gains on the day and the Dow and S&P notching record highs again. Despite the lack of major economic news to drive the markets, stocks moved higher on acquisition news (Ascena Retail Group acquiring Ann Taylor), acquisition rumors (Altera reviving talks with Intel), and even a prominent activist investor’s vote of confidence (Carl Icahn on Apple). However, it is important to note that even though the market rallied, yesterday’s trading participation was notably light and the market might need more substantial reasons to continue its positive momentum. Among the averages, the Russell 2000 and small cap companies led the way, gaining slightly more than one percent while Financials and Healthcare showed leadership between the S&P sectors.

Looking Ahead:

The Dollar is taking back some ground against the Euro this morning after the European Central Bank announced that it would front-load purchases in its bond buying program during May and June in anticipation of decreasing market liquidity in the summer months. This news, showing the ECB’s flexibility in its QE program, is boosting European markets while conversely causing the euro to fall sharply against the greenback. The Euro, which has traded as high as $1.1468 in recent sessions, is currently falling below $1.12. Stocks are also pointing higher this morning with investors eyeing key earnings releases from Wal-Mart (WMT) and Home Depot (HD) along with April housing starts.

Make sure to tune into CNBC this afternoon at 3:45 PM when our President, Oliver Pursche, joins Bill Griffith on the floor of the New York Stock Exchange to give our latest outlook and analysis.  Tune into Money Matters with Gary Goldberg this Sunday at 11:00 AM on WOR 710 AM Radio to hear our latest economic and market analysis. Visit our website for details. 


May 18 2015

This Week’s Market Moving Events

Market Recap 051515:

The markets ended the week with a whimper on Friday, vacillating between small gains and losses for most of the day before ultimately ending with marginal gains for the S&P and Dow and marginal losses for the Nasdaq and Russell 2000. Friday’s disappointing industrial production and consumer sentiment reports added to the concern that first quarter economic woes will spill into the second quarter, concerns that likely weigh on the Federal Reserve and their desire to raise rates. Industrial production fell in April for the fifth consecutive month while preliminary May consumer sentiment dropped sharply to 88.6 from a 95.9 reading in April. All four of the averages did manage to close with gains for the week, however, thanks to the strong rally on Thursday. The Nasdaq and Russell 2000 led with gains of .9% and .7% respectively. The dollar, on the other hand, closed weaker against the Euro on Friday and finished with its fifth consecutive weekly decline versus that currency. The Dollar Index has now fallen by almost seven percent since it peaked in March.

Looking Ahead:

After a round of disappointing earnings last week from department stores like Macy’s (M) and Nordstrom’s (JWN), investors will now wait on earnings from some of the largest big box retailers in the next few days including Wal-Mart (WMT), Home Depot (HD), Lowes (LOW) and Target (TGT). Consumer spending has grown little in the past few months and there is growing evidence that consumers are saving, not spending, dollars from falling oil prices. On the economic front, investors will get more insight into the Fed’s thoughts when minutes from the April meeting are released on Wednesday but we don’t anticipate any significant deviances from previous messages. The Fed has emphasized that they are data watching, particularly as it deals with inflation and employment, and will continue to do so.

This Week’s Market Moving Events:

  • Monday: US Housing Market Index
  • Tuesday: Housing Starts, Walmart (WMT) and Home Depot (HD) report earnings
  • Wednesday: Release of April 29 Fed meeting minutes, Target (TGT) and Lowes (LOW) report earnings
  • Thursday: Jobless claims, Existing Home Sales, Best Buy (BBY) and Hewlett Packard (HPQ) report earnings
  • Friday: Consumer Price Index, Deere (DE) reports earnings

Make sure to listen to Money Matters with Gary Goldberg this Sunday at 11:00 AM on WOR 710 AM Radio to hear our latest economic and market analysis. Visit our website for details. And tune into CNBC Tuesday at 3:45 to watch our President, Oliver Pursche, as he joins Bill Griffith on the floor of the NYSE to provide our latest outlook and commentary.


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