January 5, 2011
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DAILY COMMENTARY
Roller Coaster Ride Kicks Off New Year (Note: Unless otherwise stated, the index action described below relates to the EMini futures contracts for the respective indices. Actual index action may differ slightly in terms of pattern formation, although the market bias will remain the same.)
WEDNESDAY’S MARKET WRAP-UP
Market Snapshot for January 4, 2011 (9:00 p.m. ET): Closing Prices: DOW 12,418.42 (+21.04, +0.17%), SandP 500 1,277.30 (+0.24, +0.02%), NASDAQ 2,648.36 (-0.36, -0.01%), Nikkei 225 8,503.39 (-56.72, -0.66%), DAX 6,111.55 (-55.02, -0.89%), FTSE 5,668.45 (-31.46, -0.55%) OIL 102.95, GOLD 1,617.20, SILVER 29.31 EURO 1.293, YEN 76.71, BRITISH POUND 1.5606, U.S. DOLLAR INDEX 80.455
Throw Your Hands Up Everybody! The market has been having as many ups and downs on the 15 minute time frame as my favorite Busch Gardens roller coaster! All the while, the daily uptrend has continued as expected, but hanging onto this move will become more and more difficult heading into next week. So far the intraday action has shown us strong trends on the 15 minute charts, but those trends have failed to offer decent follow through into the next trading day since the new year began. After several pullbacks, however, this is likely to change by week’s end with a break in the channel that began Tuesday morning.
INDEX WRAP-UP
The Dow Jones Industrial Average ($DJI) ended the day on Wednesday with a gain of 21.04 points, or 0.17%, and closed at 12,418.42. Two-thirds of the Dow’s thirty index components posted a gain. The strongest performers were Microsoft (MSFT) (+2.39%), Alcoa (AA) (+2.38%), and Intel (INTC) (+2.32%). The weakest were Verizon (VZ) (-1.31%) and Wal-Mart (WMT) (-1.03%). The SandP 500 ($SPX) finished the session with a gain of 0.24 points, or 0.02%, and closed at 1,277.30. The top performing industry groups were materials (+3%) and financials (+2.8%). The strongest individual percentage performers in the index were Netflix (NFLX) (+11.36%), Cabot Oil and Gas Corp. (COG), and VF Corp. (VFC) (+4.40%). The weakest were Autonation Inc. (AN) (-6.83%), MetroPCS (PCS) (-6.39%), and Tenet Health Care (THC) (-5.44%). The Nasdaq Composite ($COMPX) ended the session lower by 0.36 points, or 0.36%, on Wednesday and it closed at 2,648.36. The strongest performers in the Nasdaq-100 ($NDX) were Netflix (NFLX) (+11.36%), Micron Tech. (MU) (+3.56%), and Nuance Communications (+2.89%).. The weakest were Electronic Arts (EA) (-4.74%), eBay (EBAY) (-2.77%), and Perrigo Co. (PRGO) (-3.51%).
The latest swing in the futures market came as the sharp morning selloff amid European trade was brightened heading into Thursday’s unemployment data in the States. The index futures jumped off 6:00 a.m. ET lows and broke the morning’s downtrend with the 7:00 a.m. correction period. Then came the data. Claims for new unemployment benefits fell 15,000 last week with initial claims for state unemployment benefits dropping to a seasonally adjusted 372,000. Consistent reports under 400k have been welcomed in recent weeks, but it’s still a long way to a solid recovery.
The real test for this week will be tomorrow’s report on December’s employment, including nonfarm payrolls and the latest unemployment rate. Resistance hit once again at 8:30 a.m. as the indices tested morning highs, leaving things set for a pullback ahead of the opening bell, but without a solid development just yet for a break in that larger 30 minute channel from the week-to-date.
ECONOMIC REPORTS AND EVENTS THIS WEEK
Jan 4 7:00 AM MBA Mortgage Index 12/31 Jan 4 10:00 AM Factory Orders Nov Jan 4 2:00 PM Auto Sales Dec Jan 4 2:00 PM Truck Sales Dec Jan 5 7:30 AM Challenger Job Cuts Dec Jan 5 8:15 AM ADP Employment Change Dec Jan 5 8:30 AM Initial Claims 12/31 Jan 5 8:30 AM Continuing Claims 12/24 Jan 5 10:00 AM ISM Services Dec Jan 5 11:00 AM Crude Inventories 12/31 Jan 6 8:30 AM Nonfarm Payrolls Dec Jan 6 8:30 AM Nonfarm Private Payrolls Dec Jan 6 8:30 AM Unemployment Rate Dec Jan 6 8:30 AM Hourly Earnings Dec Jan 6 8:30 AM Average Workweek Dec International: Eastern Time Zone (GMT -4:00) (New York, Toronto) Jan 3 14:00 USD Fed Releases Minutes From Dec. 13 FOMC Meeting*** Jan 4 03:55 EUR German Purchasing Manager Index Services (DEC F) (DEC F) Jan 4 04:00 EUR Euro-Zone Purchasing Manager Index Composite (DEC F) (DEC F) Jan 4 04:00 EUR Euro-Zone Purchasing Manager Index Services (DEC F) (DEC F) Jan 4 04:30 GBP Purchasing Manager Index Construction (DEC) (DEC) Jan 4 04:30 GBP Net Consumer Credit (NOV) (NOV) Jan 4 04:30 GBP Net Lending Sec. on Dwellings (NOV) (NOV) Jan 4 04:30 GBP Mortgage Approvals (NOV) (NOV) Jan 4 05:00 EUR Euro-Zone Consumer Price Index Estimate (DEC) (DEC) Jan 4 10:00 USD Factory Orders (NOV) (NOV) Jan 4 17:30 AUD AiG Performance of Service Index (DEC) (DEC) Jan 4 19:00 AUD HIA New Home Sales (NOV) (NOV) Jan 4 19:30 AUD Trade Balance (Australian dollar) (NOV) (NOV) Jan 5 04:30 GBP Purchasing Manager Index Services (DEC) (DEC) Jan 5 05:00 EUR Euro-Zone Industrial New Orders s.a. (OCT) (OCT) Jan 5 05:00 EUR Euro-Zone Producer Price Index (NOV) (NOV) Jan 5 08:15 USD ADP Employment Change (DEC) (DEC) Jan 5 10:00 CAD Ivey Purchasing Managers Index s.a. (DEC) Jan 5 10:00 USD ISM Non-Manufacturing Composite (DEC) (DEC) Jan 5 17:30 AUD AiG Performance of Construction Index (DEC) (DEC) Jan 6 USD ICSC Chain Store Sales (DEC) Jan 6 03:15 CHF Consumer Price Index (DEC) (DEC) Jan 6 03:15 CHF CPI – EU Harmonised (DEC) Jan 6 05:00 EUR Euro-Zone Business Climate Indicator (DEC) (DEC) Jan 6 05:00 EUR Euro-Zone Consumer Confidence (DEC F) (DEC F) Jan 6 05:00 EUR Euro-Zone Retail Sales (NOV) (NOV)*** Jan 6 05:00 EUR Euro-Zone Unemployment Rate (NOV) (NOV) Jan 6 06:00 EUR German Factory Orders s.a. (NOV) (NOV) Jan 6 07:00 CAD Unemployment Rate (DEC) (DEC)*** Jan 6 07:00 CAD Net Change in Employment (DEC) (DEC)*** Jan 6 07:00 CAD Full Time Employment Change (DEC) Jan 6 07:00 CAD Part Time Employment Change (DEC) Jan 6 07:00 CAD Participation Rate (DEC) Jan 6 08:30 USD Change in Non-farm Payrolls (DEC) (DEC)*** Jan 6 08:30 USD Change in Private Payrolls (DEC) Jan 6 08:30 USD Change in Manufacturing Payrolls (DEC) (DEC) Jan 6 08:30 USD Unemployment Rate (DEC) (DEC)*** Jan 6 08:30 USD Avg Hourly Earning YOY All Emp (DEC) *** Highly influential Notice: The Bastiat Group, Inc. has attempted to verify the information contained in this calendar, however, any aspect of such info may change without notice. Foreign economic reports included in this list are only those deemed “medium to high impact”.
KEY EARNINGS ANNOUNCEMENTS THIS WEEK
Monday, Jan 2, 2012 Before: – During: – After: – Tuesday, Jan 3, 2012 Before: – During: – After: LNDC, PRGS, TISI Wednesday, Jan 4, 2012 Before: UNF During: – After: MOS, RECN, SONC, TXI Thursday, Jan 5, 2012 Before: STZ, HELE, MON During: – After: SHLM, APOL, GPN, RT, SABA, XRTX Friday, Jan 6, 2012 Before: CMC, IHS During: – After: –
Note: All economic numbers and earnings reports are in line with those compiled by Briefing.com. Occasionally changes will occur that are made after the posting of this column and some companies have not confirmed their time, so always double check when taking positions overnight during earnings season! (?) = Not yet confirmed at the time the list was compiled.
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