This morning’s retail sales data provided a momentary thought the market might rise above its worries. My guess is that even if it does carry through the day and end up in the green, tomorrow will be another dour day, sluggish and fighting for direction. On that wildly happy note, how about a quote that should help shape the mind of anyone who is a market timer …
If a human being, an individual investor thinks they can out-time the computer and technology that the market is using in all of the high speed trading I wish them luck.
Maybe more than few of you out there are lucky (or skillful), but if you are new to the game, keep in mind the competition for the quick pip, the fractional cent, or the momentary opportunity is more than keen; it is predatory. I am sure someone has figured out how to play this fast price-action game, and if not yet, a strategy will come in time …
Ok, so the retail sales data came in, and as I expected, the data would beat the expectations of the professional oracles.
Retail sales rose in September, while a gauge of consumer spending pointed to stronger-than-expected economic growth in the third quarter. Retail sales increased 1.1 percent, beating expectations after an upwardly revised 1.2 percent rise in August.
This trend was easy to see as US consumers continued buying through the negativity of the summer, especially autos, and housing construction picked up. I still say the US consumer is not dead, nor even dying. Things are getting better economically and the consumer intuitively knows this, despite the US election and the drumbeat of the breathless media. Looking inside the headline data, the bigger story unfolds. Retail sales outside of autos and building materials (think construction and housing market) grew across the board.
A barometer of consumer spending known as core retail sales rose 0.9 percent last month. The details of the report showed broad strength across retailers, with sales of motor vehicles and parts up 1.3 percent. with sales at electronics retailers up 4.5 percent, while sales at food and beverage stores rose 1.2 percent.
True, the iPhone (think electronics) contributed to this rise, and people still need food and beverages, but the numbers there only go so far. Even so, the better news from this is the cycle is moving again. As I wrote, and still write, it is all about the cycle, and as consumers keep buying, so goes the inventory.
U.S. wholesalers increased their stockpiles in August and their sales rose for the first time in four months. The sales increase was the biggest one-month gain since February. Faster restocking helps drive economic growth. When businesses order more goods, it generally leads to more factory production.
Yes, but the New York manufacturing sector shrank for the third month in a row, the doomsayers will say. Certainly, one should consider that data, but keep it in context with the cycle, as the data above points to clearly.
This is a big week for data and we have Presidential Debate number two, as well as more coming on the fiscal cliff, “As Europe Turns,” and probably the disappearance of China as an economic power. Stay tuned, if you want to make your money work.
Trade in the day; Invest in your life …
