Stock Market Commentary


Netflix Opions During Earnings Review

Posted: October 17th, 2014 at 10:53 am

John Seville analyzing Netflix stock prior to their 25% decline in share price prior to their October 15, 2014 earnings announcement.

 

Executive Summary: Options before the close

Posted: October 16th, 2014 at 11:09 am

Executive Summary: September 29th

Posted: September 29th, 2014 at 1:17 pm

Executive Summary: September 25

Posted: September 25th, 2014 at 1:19 pm

Fun

Posted: August 7th, 2014 at 1:31 pm

Trader

Posted: April 21st, 2014 at 6:17 am

Dont miss reading this one!!! – Stock Report for September 30th

Posted: September 30th, 2013 at 11:36 pm

Exciting day tomorrow! Why? It’s October. The time for making money, avoiding the cold and…..making more money!!! Yep, its typically the start of the best season of trading all year round.

Now boy do I have a treat for you tonight. The potential answer to where we are going next in the market. Tomorrow is the first day of October and one thing everyone might not know is that the first day of the month and option expiration Friday (third Friday of the month) are very important as often key turning points are established on these days. In the graph below for example you will notice that the last two major turning points on the S&P were on those days exactly.

So! Tomorrow brings another month around and at the same time we are about to touch on the 23.6% Fibonacci line as well as the uptrend line forming the bottom of the Rising wedge.

Predictions? Well i think that if we hold these two levels we are in store for another leg up in the market testing 1,720 – 1,740. Longer term prediction….. that will be the last high we see before a correction.

If we hold ….. its “short term long hunting season..” (Wish I could do an Elmer Fudd impression better than that.. but you get the jist).

Stock Report for September 17th

Posted: September 25th, 2013 at 5:29 pm

 

All eyes will be on tomorrows Fed address as to speculation that it will start tapering off asset purchases in September, cutting back from $85 billion per month to $70 billion to $75 billion.  With this as the census opinion any deterrence could send the market spiraling down or shooting to all new highs anyone’s guess at this point.

 

Markets seem to be fine with the expectations of minimal tapering as the Dow Jones and S&P 500 both closed higher for the third consecutive day.  The Dow Jones closed near the middle of its days range closing up by 34.95 points to end at 15,529.73.  It is currently on pace for its second best monthly gain of 2013.  The S&P 500 added 7.16 points to end at 1,704.76, finishing above 1,700 for the first time since Aug. 5. The index is set to post its strongest first three quarters of a year since 1997. The NASDAQ was the big winner today rallying by 27.85 points to close at 3,745.70.

 

Tomorrow will be a very interesting day and could set the tone of the markets for the remainder of the year.  With the Feds wrapping up their 2 day meeting we will a statement from them at 2:00 pm EST followed up with a question and answer period with Ben Bernanke.  We will also see new housing starts numbers and crude oil inventory numbers as well.  There will be 12 companies reporting earnings tomorrow including FedEx Corp, General Mills Inc, and Oracle Corp.  Happy Trading!

 

Stock Report for September 24th

Posted: September 24th, 2013 at 8:11 pm

 

As the U.S. Government gets closer and closer to reaching the cap of its $16.7 trillion debt ceiling we get closer and closer to running the risk of the U.S. Government going into default.  Since May the government has avoided defaulting on any of its bills by employing emergency measures to manage its cash, such as suspending investments in pension funds for federal workers. Currently the government is in a stalemate as the Obama administration has vowed not to negotiate with Congress over the debt ceiling.  Today Treasury Secretary Jack Lew said that he United States could have less than $50 billion in cash in mid-October when the government exhausts its legal borrowing capacity.

The debt ceiling idea came about in 1917. Before then, Congress had to approve borrowing for each item when the government needed money.  Since 1960, Congress has acted 78 times to permanently raise, temporarily extend or revise the definition of the debt limit—49 times under Republican presidents and 29 times under Democrats.

 

Concerns have obviously taken an effect on the U.S. markets which has now given up all of its gains from last week with the Dow Jones and S&P 500 currently on 4 day losing streaks.  The Dow Jones fell a further 66.79 points to end at 15,334.59 and is now down 375 points since its peak last week.  The S&P 500 slid back beneath 1,700 to close at 1,697.42 and has seen significant divergence in its money flow.  The NASDAQ was able to stop the bleed for now and closed up by 2.97 points to finish at 3,768.25.  On the other hand the Russell 2000 Index, which measures the performance of the small-cap segment of the U.S. equity universe, rose to a new all time high today.  Small-cap stocks have led for most of the year, surging nearly 27 percent.

 

Tomorrow we will see earnings announcements from 8 companies including AutoZone Inc, Bed Bath & Beyond Inc, Jabil Circuit Inc, and SYNNEX Corp.  On the economic front we will also see numbers from the change in the total value of new purchase orders with manufacturers for durable goods; New Home Sales; and Crude Oil Inventories the Richmond Manufacturing Index.  Be sure to listen to tonight’s Trading Room if you have not already as it most surely provide some fantastic knowledge and education.  Happy Trading!!

 

Stock Report for August 7th

Posted: August 7th, 2013 at 11:20 pm

All three major U.S. indexes closed down during today’s session for the third straight day as profit taking and fear of stimulus tapering has been evident. The Dow Jones Industrial Average dropped by nearly 100 points before regaining some of its early session losses to close at 15,470.67, down 48.07 points. The S&P 500 and the NASDAQ also regained some of its early morning losses to both close down by about 1/3%. The S&P 500 should find support at 1,650 levels, with any break through this level we could see a much more dramatic pullback than what’s expected.

With two Fed Presidents scheduled to speak today we knew that once again that the day’s trading would be largely focused on the stimulus program. Philadelphia Fed President Charles Plosser ended up cancelling his speech while Cleveland Fed President Sandra Pianalto reiterated what most of the Fed members have been saying for the past month. Pianalto failed to give any time frame, but did say she would be ready to scale back the bond-buying program if the labor market continues to improve.

On the economic front we saw the number of mortgage applications increase by 0.7% after having fallen in four of the past five weeks. With increasing interest rates worries have emerged that higher costs could take some of the strength out of the housing market’s recovery. Fixed 30-year mortgage rates rose again last week to average 4.61 percent, and have now risen over 1% since early May 2013.

U.S. consumer debit numbers for June was also reported today coming in at a less than expected $13.8 billion raising the total to $2.8 trillion. Non-revolving credit, which includes loans for cars and college tuition, rose by $16.5 billion. Revolving facilities, which mostly measure credit card use, declined by $2.7 billion, the most since June 2012.

Tesla continued its unbelievable year after reporting a surprising second-quarter operating profit causing the stock trade above $152.00 a share in after-market trading. Analysts had expected the company to report a loss excluding items of 17 cents a share on $383 million in revenue. These numbers were easily beat coming in at a profit of 5 cents on revenue of $405 million. The carmaker said it had increased its rate of production 25 percent to 500 cars a week and that it had surpassed its expected sales of 4,500 vehicles for the second quarter by 650.

As we begin to come to the end of second quarter earnings season we will see 248 companies releasing their earnings tomorrow. Of the 248, 138 have seen an increase in insider ownership with the likes Chiquita Brands International Inc, Coeur d’Alene Mines Corporation, Allscripts Healthcare Solutions, Inc., and NVIDIA Corporation seeing very strong growth in insider ownership over the past 6 months. On the opposite side of the spectrum we will see 75 companies have seen a drop in insider ownership over the past 6- months including Beam Inc, AMC Networks Inc, Plug Power Inc, and Monster Beverage Corporation.