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Stock Market Today: April 14th - 18th  

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Stock Market Today: April 14th - 18th

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Markets face more turbulence as earnings ramp up

12 Hours Ago
 

Like thunderstorms cooling an overheated landscape, more selling could rumble through the stock market in the coming week.

Earnings, Fed speak and some important data, like March retail sales Monday and industrial production Wednesday, will be key in what could be a very volatile, holiday-shortened week. About 50 S&P 500 companies are expected to report—including Bank of AmericaGoogleIntelCoca-Colaand Johnson & Johnson.

Also closely watched will be a speech by Fed Chair Janet Yellen at the Economics Club of New York Wednesday afternoon. Markets are closed on Good Friday, and trading is expected to be thin because of the Passover and Easter holidays.

"I think the selloff is closer to the end than the beginning. I think the U.S. equity market is likely to reassert itself," said Leo Grohowski, chief investment officer at BNY Mellon Wealth Management. "When I think about the fundamental drivers, what has changed? Prices, sentiment. That could feed on itself. All of this comes in the context of a fairly valued market…Within that fairly valued market, this type of volatility is fairly common." 

Read MoreShort interest rises at Nasdaq, declines in NYSE stocks

The market selloff, which started in the high fliers several weeks ago, has spread to the broader market, and investors continue to toss out growth names. The Nasdaq was by far the worst performer in the past week, losing 3.1 percent to 3,999, for a more than 8 percent slide since its early March high. Momentum names were crushed, with the healthcare sector leading the broader market's decline. Biotechs were at the heart of the selling, declining with other momentum stocks in the Internet and social media sectors.

The S&P 500 fell 2.6 percent for the week to 1,815 in its worst weekly performance since June 2012. The Dow was off 2.4 percent at 16,026. The financial sector was right behind health care, losing 4 percent for the week. One of the first big earnings disappointments was JPMorgan Chase, which missed expectations Friday and saw its stock fall nearly four percent.

But Grohowski expects a more positive story for earnings this quarter, though companies are likely to blame weather and softer China demand if there are shortfalls. 

"I don't think earnings are likely to be the catalyst for a big upside move, but I do think earnings have the potential to be a calming influence particularly since expectations have come down in a big way over the last couple of months," he said. 

Read MoreGartman: Stay out of stocks for a month or so

Earnings are expected to grow just 1 percent this quarter, and Julian Emanuel of UBS said expectations for a flat quarter may be behind some of the selling in stocks, particularly for growth names.

Hedge funds were also behind the selling, he said, "... which in our mind is why emerging markets have been rallying. The fact is, the whole world has been underweight—the emerging markets for two years. It's been a successful trade. That underweight (position) is being addressed at the same time the overweight (in growth stocks) is being addressed," said Emanuel, U.S. equity and derivatives strategist at UBS Securities.

Emanuel does not expect the selling to come to an end until the S&P 500 moves several percent lower. He also expects a level of 20 on the VIX, to signal a buying opportunity. The VIX, the CBOE volatility index, is viewed as a gauge of market fear and was at 17.03 Friday, up more than 7 percent on the day.

"Our view is the last leg of this, which is where you're going to get the last spike in the VIX, over 20, is when you approach the 200-day (on the S&P) which is 1,760," he said.

Emanuel said concern about Fed policy is also behind the selloff. The Fed has created uncertainty not only by tapering its bond buying program but with its outlook for short-term rates. "Positions are too large in light of the Fed policy uncertainty. In early March there was a concern the Fed would be more aggressive. This week, we hear now, maybe there's a deeper fear of the (slower) inflation than was otherwise presumed," he said.

Economic growth has been one of the big concerns in the market, as traders wait for each piece of data to prove that the winter's doldrums had more to do with weather than anything else. For that reason, Monday's retail sales, expected to rise 0.8 percent, will be an important number.

Fed Chair Janet Yellen's comments will also be important after the Fed minutes this past week erased some concerns that the Fed would move more aggressively to raise interest rates. Those minutes also sent bond yields lower, nearly eliminating a move higher in shorter end yields since the March 19 meeting. 

The 10-year Treasury yield, meanwhile, also moved lower and was being observed across markets, as it flirted with 2.60 percent, a closely watched level near the bottom of a range it has been in for months. Stock traders were monitoring the movement with some trepidation as a signal of a flight to safety trade.

Bond strategists at Nomura Securities said in a note that they expect the market to challenge the 2.6 percent level "but in order for that to happen, stocks will need to lead the charge (even lower than the past week's re-pricing) and/or data have to disappoint expectations for a rebound, we believe. That said, we are placing high probabilities that the next few weeks will see data miss expectations and earnings from companies come in on the weaker side, driving stocks lower."

The market could correct some 7 to 8 percent, in line with the January selloff, he said. "It feels to us like the position reduction needs to go on longer. There's also an element of selling of winners that could be associated with tax season," he said. "We don't want to be anticipatory here. We'd rather let the market tell us when it looks like a better risk/reward profile and that VIX will be one of those signs."

 

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Monthly Weekly Daily Today 7:18 AM ET << 2013
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
Monday Apr 14 Tuesday Apr 15 Wednesday Apr 16 Thursday Apr 17 Friday Apr 18
 
 
 
Retail Sales
[Star]
8:30 AM ET
       

3-Yr Note Settlement

10 Yr Note Settlement

30-Yr Bond Settlement
       
Redbook
[Bullet
8:55 AM ET
     
     
Housing Starts
[Star]
8:30 AM ET
       
Beige Book
[djStar]
2:00 PM ET

Weekly Bill Settlement
 
Jobless Claims
[Star]
8:30 AM ET
                 
5-Yr TIPS Auction
[Bullet
11:30 AM ET

SIFMA Rec. Early Close 2:00 ET
   
Money Supply
[Bullet
4:30 PM ET

Good Friday

Markets Closed, Banks Open
 
Leading Indicators
[Bullet
10:00 AM ET
Equity Settlement
4-17-14
Equity Settlement
4-21-14
Equity Settlement
4-22-14
Equity Settlement
4-23-14
 
[Econoday]
Important Legal Notice: Econoday has attempted to verify the information contained in this calendar. However, any aspect of such info may change without notice. Econoday does not provide investment advice, and does not represent that any of the information or related analysis is accurate or complete at any time. Legal Notices © 1998-2012 Econoday, Inc. All Rights Reserved.

Actual Data Source: Haver Analytics |  Legal Notices © 1998-2014 Econoday, Inc. All Rights Reserved. 

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[Star] Market Moving Indicator
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[Bullet] Other Key Indicator
[Consensus] Consensus Info Available
[Report] Final Data and Analysis Available

 

Time Cur. Imp. Event Actual Forecast Previous
Monday, April 14
Tentative   CNY   Chinese M2 Money Stock (YoY)   13.0% 13.3%  
Tentative   CNY   Chinese New Loans   1,000B 645B  
05:00   EUR   Industrial Production (MoM)   0.2% -0.2%  
05:00   EUR   Industrial Production (YoY)   1.5% 2.1%  
08:30   USD   Core Retail Sales (MoM)   0.5% 0.3%  
08:30   USD   Retail Sales (MoM)   0.8% 0.3%  
09:00   EUR   French 12-Month BTF Auction        
09:00   EUR   French 3-Month BTF Auction        
09:00   EUR   French 6-Month BTF Auction        
10:00   USD   Business Inventories (MoM)   0.5% 0.4%  
11:30   USD   3-Month Bill Auction        
11:30   USD   6-Month Bill Auction        
19:01   GBP   BRC Retail Sales Monitor (YoY)   1.0% -1.0%  
21:30   AUD   Monetary Policy Meeting Minutes        
Tuesday, April 15
03:15   CHF   Swiss PPI (MoM)   -0.1% -0.4%  
03:15   CHF   Swiss PPI (YoY)   -0.8% -0.8%  
04:30   GBP   Core PPI Output (MoM)   0.1% 0.1%  
04:30   GBP   Core PPI Output (YoY)   0.9% 1.1%  
04:30   GBP   Core RPI (MoM)   0.3% 0.7%  
04:30   GBP   Core RPI (YoY)   2.5% 2.7%  
04:30   GBP   CPI (MoM)   0.2% 0.5%  
04:30   GBP   CPI (YoY)   1.6% 1.7%  
04:30   GBP   PPI Input (MoM)   -0.2% -0.4%  
04:30   GBP   PPI Input (YoY)   -6.1% -5.7%  
04:30   GBP   PPI Output (MoM)   0.1%    
04:30   GBP   PPI Output (YoY)   0.3% 0.5%  
04:30   GBP   RPI (YoY)   2.5% 2.7%  
04:30   GBP   RPI (MoM)   0.3% 0.6%  
05:00   EUR   German ZEW Current Conditions   51.8 51.3  
05:00   EUR   German ZEW Economic Sentiment   45.0 46.6  
05:00   CHF   ZEW Expectations     19.0  
07:45   USD   Chain Store Sales (YoY)     1.5%  
07:45   USD   Chain Store Sales (WoW)     1.5%  
08:30   CAD   Manufacturing Sales (MoM)   1.0% 1.5%  
08:30   USD   Core CPI (MoM)   0.1% 0.1%  
08:30   USD   Core CPI (YoY)   1.6% 1.6%  
08:30   USD   CPI (MoM)   0.1% 0.1%  
08:30   USD   CPI (YoY)   1.5% 1.1%  
08:30   USD   NY Empire State Manufacturing Index   8.00 5.61  
08:30   USD   Real Earnings (MoM)   0.2%    
08:55   USD   Redbook (MoM)     -0.5%  
08:55   USD   Redbook (YoY)     2.9%  
09:00   USD   Overall Net Capital Flow     83.00B  
09:00   USD   TIC Net Long-Term Transactions     7.3B  
09:00   USD   TIC Net Long-Term Transactions including Swaps     -2.50B  
09:00   USD   US Foreign Buying, T-bonds     -0.60B  
10:00   USD   NAHB Housing Market Index   50 47  
11:30   USD   4-Week Bill Auction        
11:30   USD   Cleveland CPI (MoM)     0.2%  
18:45   NZD   CPI (QoQ)   0.5% 0.1%  
18:45   NZD   CPI (YoY)   1.7% 1.6%  
22:00   CNY   Chinese Fixed Asset Investment (YoY)   18.1% 17.9%  
22:00   CNY   Chinese GDP (QoQ)   1.4% 1.8%  
22:00   CNY   Chinese GDP (YoY)   7.3% 7.7%  
22:00   CNY   Chinese Industrial Production (YoY)   9.0% 8.6%  
22:00   CNY   Chinese Retail Sales (YoY)   12.1% 11.8%  
Wednesday, April 16
00:30   JPY   Capacity Utilization (MoM)     5.9%  
00:30   JPY   Industrial Production (MoM)     -2.3%  
04:00   EUR   Italian Trade Balance     0.37B  
04:00   EUR   Italian Trade Balance EU     1.26B  
04:30   GBP   Average Earnings ex Bonus   1.7% 1.3%  
04:30   GBP   Average Earnings Index +Bonus   1.8% 1.4%  
04:30   GBP   Claimant Count Change   -30.0K -34.6K  
04:30   GBP   Unemployment Rate   7.1% 7.2%  
05:00   EUR   Core CPI (YoY)     1.0%  
05:00   EUR   Core CPI (MoM)     0.5%  
05:00   EUR   CPI (MoM)   1.0% 0.3%  
05:00   EUR   CPI (YoY)   0.5% 0.5%  
05:00   CHF   ZEW Expectations   23.0 19.0  
07:00   USD   MBA 30-Year Mortgage Rate     4.56%  
08:30   CAD   Foreign Securities Purchases     1.09B  
08:30   CAD   Foreign Securities Purchases by Canadians     2.34B  
08:30   USD   Building Permits (MoM)     7.3%  
08:30   USD   Building Permits   1.020M 1.014M  
08:30   USD   Housing Starts   0.975M 0.907M  
08:30   USD   Housing Starts (MoM)     -0.2%  
09:15   USD   Capacity Utilization Rate   78.8% 78.4%  
09:15   USD   Industrial Production (MoM)   0.5% 0.6%  
10:00   CAD   Interest Rate Decision   1.00% 1.00%  
10:30   USD   Crude Oil Inventories     4.030M  
10:30   USD   EIA Weekly Distillates Stocks     0.239M  
10:30   USD   Gasoline Inventories     -5.188M  
14:00   USD   Beige Book        
19:50   JPY   Foreign Bonds Buying     -380.5B  
Thursday, April 17
01:00   JPY   Household Confidence     38.3  
02:00   EUR   German PPI (MoM)        
02:00   EUR   German PPI (YoY)   -0.7% -0.9%  
08:30   CAD   Core CPI (YoY)   1.0% 1.2%  
08:30   CAD   Core CPI (MoM)     0.7%  
08:30   CAD   CPI (MoM)     0.8%  
08:30   CAD   CPI (YoY)   1.0% 1.1%  
08:30   USD   Continuing Jobless Claims   2,790K 2,776K  
08:30   USD   Initial Jobless Claims   311K 300K  
08:30   USD   Jobless Claims 4-Week Avg.     316.25K  
10:00   USD   Philadelphia Fed Manufacturing Index   10.0 9.0  
10:00   USD   Philly Fed Business Conditions     35.4  
10:00   USD   Philly Fed Employment     1.7  
10:30   USD   Natural Gas Storage     4B  
13:00   USD   5-Year TIPS Auction        
21:30   CNY   China House Prices (YoY)     8.7%  
Friday, April 18
All Day   Holiday United States - Good Friday
All Day   Holiday Australia - Good Friday
All Day   Holiday France - Good Friday
All Day   Holiday Germany - Good Friday
All Day   Holiday United Kingdom - Good Friday
All Day   Holiday Italy - Good Friday
All Day   Holiday Switzerland - Good Friday
All Day   Holiday Spain - Good Friday
All Day   Holiday Canada - Good Friday
All Day   Holiday New Zealand - Good Friday
04:00   EUR   Italian Industrial New Orders (MoM)     4.8%  
04:00   EUR   Italian Industrial New Orders (YoY)     2.6%  
04:00   EUR   Italian Industrial Sales (MoM)     1.20%  
05:00   EUR   Italian Wage Inflation (MoM)     0.1%  
 
Legend

Speech

Preliminary Release

Revised Release

Retrieving Data

Low Volatility Expected

Moderate Volatility Expected

High Volatility Expected

 

 

 

 

What to Watch in the Week Ahead

 

  • Monday

Earnings: Citigroup, JB Hunt Transportation, Pinnacle Financial

8:30 a.m.: Retail sales

10:00 a.m.: Business inventories

2:00 p.m.: Fed Gov. Daniel Tarullo

  • Tuesday

Earnings: Coca-ColaJohnson and JohnsonIntelYahoo, CSX, Charles Schwab, Comerica, Northern Trust, Pep Boys, Infosys, Adtran, Interactive Brokers

8:30 a.m.: CPI

8:30 a.m.: Empire state survey

8:30 a.m.: Atlanta Fed President Dennis Lockhart

8:45 a.m.: Fed Chair Janet Yellen opening remarks at Atlanta Fed conference

9:00 a.m.: TIC data

10:00 a.m.: NAHB survey

3:00 p.m.: Philadelphia Fed President Charles Plosser, panel at Atlanta Fed conference

4:00 p.m.: Boston Fed President Eric Rosengren

8:00 p.m.: Minneapolis Fed President Narayana Kocherlakota

  • Wednesday

Earnings: GoogleBank of AmericaIBMAmerican Express, PNC Financial, Capital One, Credit Suisse, US Bancorp, Huntington Bancshares, SLM, SanDisk, Steel Dynamics, Abbott Labs, St. Jude Medical, Noble, Burberry, Kansas City Southern

7:00 a.m.: Mortgage applications

8:30 a.m.: Housing starts

8:30 a.m.: Fed Gov. Jerome Stein

9:15 am Industrial production

11:30 a.m.: Atlanta Fed's Lockhart

12:25 p.m.: Fed Chair Janet Yellen at Economic Club of NY, Q&A

1:25 p.m.: Dallas Fed President Richard Fisher

2:00 p.m.: Beige book

  • Thursday

Earnings: General ElectricBlackRockGoldman SachsMorgan StanleyBlackstone, DuPont, Union Pacific, PepsicoChipotle, Baker Hughes, Sherwin-Williams, Fifth Third, AutoNation, Sonoco Products, Snap-on Mattel, Cypress Semiconductor, Baxter, Taiwan Semiconductor, Rockwell Collins

8:30 a.m.: Jobless claims

10:00 a.m.: Philadelphia Fed survey

  • Friday

Markets closed for Good Friday

10:00 a.m.: Leading indicators

 

 

>>>Also, do not miss Mark Vierra's latest log entry! --> Mark's Weekly Trading Log

 

 

>>>Will this week end Up, Down, or Flat? Vote in --> Poll: Weekly Poll - Sentiment (4/14-4/18)

 

votemarcosx3x.png

THE STOCK MARKET THREAD GUIDELINES

  • Respect your fellow traders. This means no insults, derogatory remarks or any other type of behavior that derails the thread.
  • Keep off topic chatter to a minimum. If the market is flat and nothing is happening, we do not mind hearing about your weekend and your hot girlfriend. If the market is moving and trades are flying the best thing to do is post important stock related events that can help your fellow traders.
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Ding! Ding! Ding!

 

 

post #2 of 354
Thread Starter 

Stock Market Analysis for Week Ending April 11th, 2014

Video from AlphaTrends Brian Shannon

 

ShadowTrader Video Weekly 04.13.14 - Confluence of supports setting up long trade this week?

Video from ShadowTrader Peter Reznicek

 

MrTopStep Closing Print Video 04-11-2014

Video from MrTopStep Danny Riley

 

On sea-change watch next week: Cramer

Video from CNBC Mad Money Jim Cramer

 

post #3 of 354
Thread Starter 

 


Nasdaq Breaks 4,000; Collapses To Worst Week Since June 2012 (Click to show)
Tyler Durden's picture

Nasdaq Breaks 4,000; Collapses To Worst Week Since June 2012


5 Things To Ponder: Is This "THE" Correction? (Click to show)
Tyler Durden's picture

5 Things To Ponder: Is This "THE" Correction?

 

 
 

 
 

 
 

 
 

 
 

 
 

 

 

 
 

 

 


Gold’s Short vs Long Term View (Click to show)

Gold’s Short vs Long Term View

Chart 1: Gold has outperformed other asset classes over the quarter

Global Macro Performance Source: Short Side of Long

Gold has outperformed all other major asset classes over the last quarter. The chart above shows that up until recently, the yellow metal has returned over 13% for the rolling 3 month period. Not a bad performance when compared to US equities, GEM equities or US Treasury Long Bond which returned 0%, -7% and 6% over the same time period respectively. Moreover, this was definitely a surprise to majority considering just about everyone came into 2014 super bearish on the precious metals sector.

Chart 2: Hedge funds have piled into Gold over the last three months 

Gold COT Source: Short Side of Long

However, the situation has changed quite quickly after such a superb rally. With a strong performance, comes the momentum chasers (think dumb money hedge funds). This is quite a repetitive scenario, where Johnny Come Lately’s pile into a hottest performing asset class of the quarter, as they extrapolate previous quarters return into the future. They “hope” the momentum continues for longer so they can also make a positive return.

Now, in all respect, bullish sentiment is not always a sign to worry, especially during uptrends where its quite normal to see bulls dominate bears (as long as it doesn’t become too extreme). However, Gold has not yet proven that it has started a new uptrend. Its price action is rather negative, despite such a strong quarter. As we can see in Chart 2, a technical pattern of lower lows and lower highs still remains in place.

Chart 3: Precious metals have dramatically underperformed other assets

3 Year Performance Source: Short Side of Long

So where to from here for the yellow metal? Personally, I have maintained that the price of Gold has a date with the $1,000 per ounce physiological and technical level. In any event, whether I am right or wrong, and whether Gold continues its sideways consolidation or breaks down lower, investors should be reminded that the overall Precious Metals sector has dramatically under-performed all other asset classes over the last 3 years. Therefore, this sector of the market is one of the only areas offering value, unlike overvalued and aged US stock bull market or the extremely overextended 32 year secular bull market in US Bonds.


Bearish Divergence Still In Play! (Click to show)

Bearish Divergence Still In Play!

Chart 1: Bearish divergence between S&P 500 and its 200 MA still in play

S&P vs 200 MA Source: Short Side of Long

We have looked at various divergences with the US equity market over the last few months. One of many that is still in play is the S&P 500 index vs its own 200 day moving average. Historically, this type of bearish divergence indicates a loss of momentum and has almost always led some kind of a correction (mild or serious).


April Sentiment Summary (Click to show)

April Sentiment Summary

Equities

  • Recent AAII survey readings came in at 35% bulls and 27% bears. Since the last report in March, AAII bullish readings have fallen ever so slightly, while bearish readings have remained pretty much unchanged. However, turning our attention to the less volatile AAII monthly allocation survey, we can see the investors continue to add exposure towards equities, while reducing their cash levels, a major warning signal of complacency.

Chart 1: Extremely low level of bearish advisors usually signals a top!

Investor Intelligence Bears Source: Short Side of Long

  • Recent Investor Intelligence survey levels came in at 51% bulls and 19% bears. Over the last four weeks, bullish readings have pulled back slightly while bearish readings have slowly started to rise. Nevertheless, the chart above shows that for 24 weeks in the row, percentage of bearish advisors has remained below 20%. This type of a sentiment condition is very rare and warns of major complacency amongst investment participants.
  • Recent NAAIM survey levels came in at 91% net long exposure, while this weeks intensity was recorded at 150%. Over the last month, fund managers have been rising their exposure towards equities on weekly basis, while the intensity of exposure (difference between the most bullish and most bearish exposure) has stayed extremely elevated at 170% net long when averaged over the last 6 weeks.

Chart 2: Money market funds are signalling high complacency levels…

Money Market Funds Source: Ned Davis Research

  • Recent ICI fund flows reports showed that “equity funds had estimated inflows of $1.23 billion for the week, compared to estimated outflows of $962 million in the previous week. Domestic equity funds had estimated outflows of $267 million, while estimated inflows to world equity funds were $1.50 billion.”  Money continues to flow into the stock market, as seen in this chart  here showing 15 consecutive monthly inflows. This streak is bound to be broken eventually, as a more meaningful correction starts (more likely sooner rather than later).
  • Moreover, the next sell off might not be a correction, but rather a bear market. Chart 2 shows that money market funds have diverged quite a lot from the overall broad equity market value, signalling high complacency levels similar to 1981, 1987, 1998, 2000 and 2007. All of those dates were peaks prior to at least a 20% drop in equity prices and some full blown crashes.

Chart 3: Rydex traders are not only optimistic, they are outright greedy!

Nova Ursa Fund Flow Ratio Source: Short Side of Long

  • Recent Rydex fund flows are rising to higher and higher levels by the day. Rydex traders, usually considered as dumb money, are pilling into US equities at such a fast rate, you might as well call the long trade a “free lunch”. They are so greedy right now, that they are sure the market will rise to higher and higher levels… in their view most likely “a sure bet”. While previous optimistic levels lead to sharp sell offs as seen in Chart 3, the current level of greed just might lead to something even more worrisome.
  • Recent commitment of traders reports (also known as dumb money) showed that speculators have slowly, but surely been closing their net long bets on technology stocks. Hedge funds and other speculators currently hold over just over 74,000 net long contracts, which is a substantial decrease from 113,200 at the start of March. Nevertheless, speculators aren’t anywhere near outright bearish levels yet. Previous months chart can be seen by clicking here.
Chart 4: Margin debt continues to climb higher and higher and higher!
 

NYSE Margin Debt Source: Short Side of Long

  • According to NYSE, Margin Debt (measure of investor leverage) climbed to yet another record high in February 2014. These days, there isn’t a month that passes by where we don’t learn that leverage is increasing at an almost exponential pace. Official nominal margin debt readings now stands at $465.72 billion, $14.5 billion higher than last month. Inflation adjusted margin debt in todays dollars is seen in Chart 5, while investor net credit levels, currently at record lows, can be seen by clicking here. Thanks to Doug Short for both charts.
Chart 5: Consumer discretionary stocks are under performing the market
 

S&P 500 vs Consumer Equities Ratio Source: Short Side of Long

  • Side note: I originally warned about the developing weakness in Consumer Discretionary equities all the way back in middle of January. This situation is now developing further, where the Discretionary sectors continues to under-perform both the overall market as well as Consumer Staples sector. The chart above shows S&P 500 vs Discretionary / Staples Ratio, which represents the cyclicals vs defensives performance. Usually, cyclical sectors will turn down first before the market peak, as seen in early 2007 and early 2011. The same is true for the bottoming process too, where cyclical sectors sense the recovery before the market itself, as seen during late 2008 and late 2011. Interestingly, we are once again getting a warning from the ratio above, which could potentially mean that the market is now starting a topping process. Watch carefully!

Bonds

  • The situation has not changed much in the Bond sentiment surveys compared to the March report. As Treasury prices have mainly moved sideways, so has the sentiment. Both Market Vane Bullish Percentage and Consensus Inc survey remain at or close to neutral level. Neither of these surveys is giving us any contrarian signals worthy of a trade nor an investment right now. However, the fund flows towards corporate debt and especially the junk bond market (easily seen with narrowing spreads), is very frothy right now.

Chart 6: Last years panic was a decent buying point for corporate bonds

Bond Fund Flows Source: Short Side of Long

  • Recent ICI fund flows reports showed that “bond funds had estimated inflows of $1.28 billion, compared to estimated inflows of $2.48 billion during the previous week. Taxable bond funds saw estimated inflows of $1.23 billion, while municipal bond funds had estimated inflows of $49 million.” Retail investor panic is usually a signal to buy an asset, and this was once again proven by corporate bond price sell off in 2013 (seen in the chart above). Large fund outflows by the public usually occur near market troughs and this time was no different. The price has managed to bottom and rally somewhat, gifting those contrarians who went against the herd a decent total return (including the yield) for a few quarters now. Interestingly, as the rally continues, the fund flows are back again…

Chart 7: Speculators now hold mild net short bets on Treasury Bonds

Treasury COT Source: Short Side of Long

  • Recent commitment of traders report (also known as dumb money) shows that small speculators have just above closed all of their net short bets against the Treasury Bonds. Recent COT report showed that small speculators now hold only -5,000 net short contracts. Personally, I believe that specs could actually turn net long on the Treasury Bond market if and when the equity market experiences a more significant correction. A warning signal for the equity market could be the inverse correlation with bonds and a possible breakout from the current basing pattern. Watch that neckline closing on the Long Bond!

Commodities

Chart 8: Commodity index reaches resistance as specs build positions!

Commodity COT Source: Short Side of Long

  • The recent commitment of traders reports (also known as dumb money) showed that hedge funds and other speculators continue to remain very bullish towards the overall commodity complex, with exposure reaching over 930,000 net long contracts (custom COT). This is now the highest net long exposure since September 2012, just before the price peaked. Majority of the net long contract building has come from Agricultural and Precious Metal sectors, which have rallied decently over the last quarter. The chart above shows that the equal weighted commodity index has now reached a technical resistance area and its time for consolidation.

Chart 9: Brent Crude Oil is acting very weak despite the commodity rally

Brent Crude COT Source: Short Side of Long

  • As already discussed in a few posts as well as last months sentiment report, several industrial commodities that are economically sensitive are acting rather weak. One of these is Brent Crude, the global barometer for energy prices. As we can see in the chart above, prices peaked out during the Lybian Crisis into May 2011. For the last three years, prices have gone essentially nowhere. Technically, Brent Crude is now at crossroads, with a major price decision looming in coming days or weeks. Pay a close attention to this one, as it could be an important signal for the overall global economy. 

Currencies

Chart 10: Dollar positioning is neutral as price holds important support 

US Dollar COT Source: Short Side of Long

  • Recent commitment of traders reports (also known as dumb money) have shown a gradual decrease in bullish positioning towards the US Dollar. During the last report in early March, cumulative G10 positioning by hedge funds and other speculators stood at $10.3 billion net longs. The sell off that occurred into the Fed press conference shook those net long speculators out completely, with current positioning pretty much at neutral levels (neither long nor short). Comments by Fed Chair(wo)man Yellen have changed the dynamics of the currency markets a bit, with the Dollar bouncing of its support. At the same time the Euro, Pound, Franc and Yen have been rather weak as of late.

Chart 11: Canadian Dollar is one of the more hated currencies right now!

Loonie Public Opinion Source: SentimenTrader (edited by Short Side of Long)

  • Sentiment survey readings on various currencies has been skewed towards European continent strength and Emerging Market weakness, which has sort of created a US Dollar neutrality, so to speak. Having said that, commodity currencies like the Aussie and in particular the Loonie continue to under-perform. As we can see in the chart above, thanks to SentimenTrader, survey readings have now fallen to negative extremes last seen during the GFC and late 2008 panic sell off. Let us not forget that the Canadian Dollar peaked all the way back in middle of 2011 and has been in a bear market for three years now. The currency is down 7.3% over the last 12 months and almost 13% over the last three years (the worst 3 year performance since 1998).

Chart 12: Hedge funds are once again cutting their net long bets on PMs

Gold COT Source: Short Side of Long

  • Recent commitment of traders reports (also known as dumb money) showed hedge funds and other speculators burnt by jumping onto the precious metals too late. Last months report warned that Gold, as well as Gold Miners, were becoming very overbought in the short term and a correction was looming. Interestingly, just before the correction started, specs increased net longs in Gold and Silver substantially. Now… with a price drop, we see those positions closed again. Current Gold hedge fund positioning stands just over 100,000 net longs; while current Silver hedge fund positioning stands at just over 14,500 net longs. Respectively, that is 31.4% net longs as a percentage of open interest in Gold and 18.9% in Silver… not yet close to single digits associated with intermediate bottoms and buying opportunities.


post #4 of 354
Thread Starter 

 

Wall St Week Ahead-Stocks face earnings blues after tech selloff

Caroline Valetkevitch
11 Hours Ago

 

NEW YORK, April 11 (Reuters) - The wrenching selloff in U.S. high-growth technology and biotech shares could leave investors braced for more than a minor pullback when earnings pick up speed next week.

First-quarter earnings estimates have fallen sharply as many companies have blamed the brutal winter for weak outlooks.

With high-valuation stocks under pressure, earnings could be subjected to even more investor scrutiny than usual.

"There's skepticism among investors about the outlook, and we're getting into the first-quarter earnings season, so you're going to see some positioning," said Brian Jacobsen, chief portfolio strategist at Wells Fargo Funds Management in Menomonee Falls, Wisconsin.

Profit growth for Standard & Poor's 500 companies now is expected to have increased just 0.9 percent in the first quarter from a year ago, down from a Jan. 1 forecast for 6.5 percent growth, Thomson Reuters data showed.

In the coming week, 54 S&P 500 companies are scheduled to report first-quarter earnings. In comparison, 29 companies in the S&P 500 had reported results through Friday.

Earnings are due next week from such high-profile names as General Electric, Johnson & Johnson, Goldman Sachs, Google and IBM.

Wall Street will get more readings on the U.S. economy in the coming week, with retail sales on Monday, the Consumer Price Index on Tuesday, U.S. housing starts and industrial output on Wednesday and the Federal Reserve Bank of Philadelphia's business activity index on Thursday. The latest weekly initial jobless claims will also be released on Thursday.

This flurry of numbers will come during a four-day week. The U.S. stock market will be closed for Good Friday.

Volume is also likely to be lighter than usual with some participants away for the observance of Passover, which will begin at sundown on Monday.

BLUE CHIPS BACK IN STYLE

A move into blue chips is one trend emerging after the market's slide, which pushed the Nasdaq on Friday to a close below 4,000 for the first time since Feb. 3.

The Nasdaq Composite Index is down 4.7 percent for the month so far, while the Dow Jones industrial average is down 2.6 percent and the S&P 500 is down 3 percent.

"You've seen small caps dominate," Jacobsen said, referring to some of Wall Street's one-time darlings. "We're going to begin to see large caps dominate now as people shift more from these high-beta plays to quality."

Despite the selloff, data so far showed that investors are still pouring money into stocks.

Investors in U.S.-based funds put $8.9 billion into stock funds in the week ended April 9, the biggest net inflows in four weeks. At the same time, funds that mostly hold U.S. Treasuries reported outflows for the first time in four weeks, according to data from Thomson Reuters' Lipper service on Thursday.

Yet biotechs have been slammed. The Nasdaq biotechnology index has fallen for the seventh straight week. The biotech index is down about 21 percent from its record closing high on Feb. 25. The last time it fell for seven straight weeks was in the summer of 1998.

The price-to-earnings ratio on the Nasdaq biotech index is 34.4. The forward P/E ratio for the S&P 500 is 14.9, Thomson Reuters data showed.

Data on sector exchange-traded funds also showed a big move out of tech-related areas, with science and tech ETFs registering outflows in the week ended April 9 after at least five straight weeks of inflows. Healthcare and biotech ETFs also showed outflows for the latest week, according to Lipper data.

High-growth companies, mostly in the tech and biotech sectors, led 2013's rally, leaving them with some of the market's highest valuations.

"Valuations are going to start becoming relevant again, at least for a while," said Uri Landesman, president of Platinum Partners in New York.

TUNING IN TO THE FED

Part of what's behind the big momentum selloff may be nervousness surrounding the Federal Reserve's December decision to scale back its economic stimulus, or quantitative easing.

That's why all eyes will be on Fed Chair Janet Yellen when she speaks on Wednesday to the Economic Club of New York.

"We've had basically five years of a market that's been nannied by the Federal Reserve," which has driven up market valuations, said Quincy Krosby, market strategist at Prudential Financial, based in Newark, New Jersey.

"Now as we get closer and closer to the end of QE, I think traders and hedge funds are being very careful and selective."

(Wall St Week Ahead runs every Friday. Questions or comments on this column can be emailed to: caroline.valetkevitch(at)thomsonreuters.com )

(Reporting by Caroline Valetkevitch; Editing by Jan Paschal; For the U.S. stock market report, click on )

post #5 of 354
Thread Starter 
post #6 of 354
Thread Starter 

post #7 of 354
Thread Starter 

4/11 market update

Video from TheChartPatternTrader Ron Walker

 

post #8 of 354
Thread Starter 

some names reporting earnings in the week ahead-

 

Citi.svg

 

  • C earnings for Monday April 14th, 2014-

 

  1st Quarter Ending March 2014
 Earnings Whisper ®: N/A  
 Consensus Estimate: $1.18  
 Surprise Expectation 1:  
 Release Date: [confirmed] 4/14/2014  
Before Open  
 Expected Time 2: 8:00 AM ET  
 Conference Call: 11:00 AM ET  
 

 

 

Coca-Cola logo.svg

 

  • KO earnings for Tuesday April 15th, 2014-

 

  1st Quarter Ending March 2014
 Earnings Whisper ®: N/A  
 Consensus Estimate: $0.44  
 Surprise Expectation 1:  
 Release Date: [confirmed] 4/15/2014  
Before Open  
 Expected Time 2: 7:30 AM ET  
 Conference Call: 9:30 AM ET  
 

 

 

 

JohnsonandJohnsonLogo.svg

 

  • JNJ earnings for Tuesday April 15th, 2014-

 

  1st Quarter Ending March 2014
 Earnings Whisper ®: $1.52  
 Consensus Estimate: $1.48  
 Surprise Expectation 1:  
 Release Date: [confirmed] 4/15/2014  
Before Open  
 Expected Time 2: 7:45 AM ET  
 Conference Call: 8:30 AM ET  
 

 

 

Intel-logo.svg

 

  • INTC earnings for Tuesday April 15th, 2014-

  1st Quarter Ending March 2014
 Earnings Whisper ®: $0.39  
 Consensus Estimate: $0.37  
 Surprise Expectation 1:  
 Release Date: [confirmed] 4/15/2014  
After Close  
 Expected Time 2: 4:15 PM ET  
 Conference Call: 5:00 PM ET  
 

 

 

Yahoo! logo.svg

 

  • YHOO earnings for Tuesday April 15th, 2014-

  1st Quarter Ending March 2014
 Earnings Whisper ®: $0.41  
 Consensus Estimate: $0.37  
 Surprise Expectation 1:  
 Release Date: [confirmed] 4/15/2014  
After Close  
 Expected Time 2: 4:05 PM ET  
 Conference Call: 5:00 PM ET  
 

 

 

Google Logo

 

  • GOOG earnings for Wednesday April 16th, 2014-

  Quarter Ending March 2014
 Earnings Whisper ®: $13.27  
 Consensus Estimate: N/A  
 Surprise Expectation 1:  
 Release Date: [confirmed] 4/16/2014  
After Close  
 Expected Time 2: 4:00 PM ET  
 Conference Call: 4:30 PM ET  
 

 

 

Bank of America logo.svg

 

  • BAC earnings for Wednesday April 16th, 2014-

  1st Quarter Ending March 2014
 Earnings Whisper ®: N/A  
 Consensus Estimate: $0.05  
 Surprise Expectation 1:  
 Release Date: [not confirmed] 4/16/2014  
Before Open  
 Expected Time 2: 7:00 AM ET  
 Conference Call: 8:30 AM ET  
 

 

 

IBM logo.svg

 

  • IBM earnings for Wednesday April 16th, 2014-

  1st Quarter Ending March 2014
 Earnings Whisper ®: N/A  
 Consensus Estimate: $2.54  
 Surprise Expectation 1:  
 Release Date: [confirmed] 4/16/2014  
After Close  
 Expected Time 2: 4:10 PM ET  
 Conference Call: 4:30 PM ET  
 

 

 

American Express logo.svg

 

  • AXP earnings for Wednesday April 16th, 2014-

  1st Quarter Ending March 2014
 Earnings Whisper ®: N/A  
 Consensus Estimate: $1.30  
 Surprise Expectation 1:  
 Release Date: [confirmed] 4/16/2014  
After Close  
 Expected Time 2: 4:10 PM ET  
 Conference Call: 5:00 PM ET  
 

 

 

Logo of General Electric

 

  • GE earnings for Thursday April 17th, 2014-

 

  1st Quarter Ending March 2014
 Earnings Whisper ®: N/A  
 Consensus Estimate: $0.32  
 Surprise Expectation 1:  
 Release Date: [confirmed] 4/17/2014  
Before Open  
 Expected Time 2: 6:30 AM ET  
 Conference Call: 8:30 AM ET  
 

 

 

Goldman Sachs.svg

 

 

 

  • GS earnings for Thursday April 17th, 2014-

  1st Quarter Ending March 2014
 Earnings Whisper ®: $3.30  
 Consensus Estimate: $3.43  
 Surprise Expectation 1:  
 Release Date: [confirmed] 4/17/2014  
Before Open  
 Expected Time 2: 7:00 AM ET  
 Conference Call: 9:30 AM ET  
 

 

 

Morgan Stanley Logo

 

  • MS earnings for Thursday April 17th, 2014-

  1st Quarter Ending March 2014
 Earnings Whisper ®: N/A  
 Consensus Estimate: $0.60  
 Surprise Expectation 1:  
 Release Date: [confirmed] 4/17/2014  
Before Open  
 Expected Time 2: 8:00 AM ET  
 Conference Call: 8:30 AM ET  
 

 

 

Pepsico logo.svg

 

  • PEP earnings for Thursday April 17th, 2014-

 

  1st Quarter Ending March 2014
 Earnings Whisper ®: N/A  
 Consensus Estimate: $0.75  
 Surprise Expectation 1:  
 Release Date: [confirmed] 4/17/2014  
Before Open  
 Expected Time 2: 7:00 AM ET  
 Conference Call: 8:00 AM ET  
 

 

 

Chipotle Mexican Grill logo.svg

 

  • CMG earnings for Thursday April 17th, 2014-

 

  1st Quarter Ending March 2014
 Earnings Whisper ®: N/A  
 Consensus Estimate: $2.82  
 Surprise Expectation 1:  
 Release Date: [confirmed] 4/17/2014  
Before Open  
 Expected Time 2: N/A  
 Conference Call: 11:00 AM ET  
 

 

post #9 of 354

Thanks Cy for putting effort and doing a very good job in giving a head start for the week.

 

Lately, some of the seniors were not happy with me adding too many posts in this thread. I agree and apologize. This is mainly a market direction discussion thread. So, I decided to post mostly in the following thread and post here only if something is very important.

 

Please join and share anything you may like even though the focus is to find worthy trade set ups intraday such that we can execute and make some profit.

If we are experiencing a bounce on Monday, I will post some stock tickers that I would be going long.

 

http://www.hotstockmarket.com/t/273616/regular-and-jackpot-option-plays-daily-discussion/1060

post #10 of 354
Quote:
Originally Posted by Philosuffer View Post

Thanks Cy for putting effort and doing a very good job in giving a head start for the week.

Lately, some of the seniors were not happy with me adding too many posts in this thread. I agree and apologize. This is mainly a market direction discussion thread. So, I decided to post mostly in the following thread and post here only if something is very important.

Please join and share anything you may like even though the focus is to find worthy trade set ups intraday such that we can execute and make some profit.
If we are experiencing a bounce on Monday, I will post some stock tickers that I would be going long.

http://www.hotstockmarket.com/t/273616/regular-and-jackpot-option-plays-daily-discussion/1060

It is not the number of posts, it is the journal-like posts that don't really fit, imo. Posting trade setups and ideas, talking strategy and trade methodology, psychological management is the whole point of this thread, things get screwy when talking about personal P/L, or personal trades alll the time and screenshots of the portfolio every day. If everyone did that in the main thread all the time, it would be no more than a collection of personal journals.

To me, saying "I like Apple long $500" and posting a chart with a trendline where you can see that the price may come down there is helpful. It is still helpful if Apple is at that moment on the trendline and you just got long 2 minutes ago. Posting a chart of Apple later in the day and saying "I loaded Apple long at $500" and on the chart that already happened four hours ago and now its at $520, well who exactly is that helping?

I mean once in a while if something crazy happened, the personal gloating is fine.. like last year when Venom and AsianWill had six figure profits on Apple options. Ya know, once in a blue moon kind of stuff where you just know others are gonna go "woah man". biggrin.gif
post #11 of 354
Haha, I remember that. Except it was me and WilltheGreat, and only he kept six figure profits.
post #12 of 354
Quote:
Originally Posted by Venom08 View Post

Haha, I remember that. Except it was me and WilltheGreat, and only he kept six figure profits.

 

LMFAO, that's what I meant... not AsianWill.. had a total brain fart. :cool:

post #13 of 354

So... I failed to close Put options last Friday... Now I have -(negative) shares in my account and a crap load of cash.  How fucked am I potentially? Or does this get sorted out pre-market on Monday morning?

post #14 of 354

 Will need a little more info... Did you sell short? were they weekly? Did you buy them?....

post #15 of 354

Bought 5 weekly Put options on AAPL, sold 3 for a profit and let 2 ride... I rid them a little too long.  Now I got -200 AAPL shares in my account and a lot of cash.  I'm assuming (hoping) that come Monday it just gets settled, the shares get bought with the cash at the price AAPL closed at on Friday.

post #16 of 354

Generally if in the money your broker will execute the contract.. So the contracts allowed you to put 200 shares of appl on who ever sold the contracts at x price... I have to assume they were in the money as you are negative the shares. If your broker doesn't buy them for you then you will have to buy the 200 shares to cover the ones you put on the seller. My Broker will execute the transaction for me not sure what your brokers rules are. Anyways worse case is you have to buy 200 shares of aapl to cover the 200 you are negative.. The rest is your profit... Hope this helps :Thumbsup: 

post #17 of 354
Quote:
Originally Posted by Allegiance View Post
 

Bought 5 weekly Put options on AAPL, sold 3 for a profit and let 2 ride... I rid them a little too long.  Now I got -200 AAPL shares in my account and a lot of cash.  I'm assuming (hoping) that come Monday it just gets settled, the shares get bought with the cash at the price AAPL closed at on Friday.


fk. I remember that happened to me but with five $700-strike calls, the day AAPL hit an ATH. On Monday I found myself long 500 AAPL shares and a stock that was crashing $20 pre-market. Your best hope is that AAPL opens flat and you get out, or perhaps you'll get lucky and AAPL gaps lower.

post #18 of 354
Hey guys how's it going? Crazy week. Just wondering, does anybody know the best way to get a graphical representation of the p/e of a certain stock at that given time, historical avg. Etc. In TOS

Also, what are your opinions on the p/e ratio in general for determining oversold situations, among other things.

And lastly, best p/e? Regular? Shiller? Thanks guys smile.gif
post #19 of 354
Weekend read for you all.. regarding the incident at goldman sachs and their HFT "code theft"
 
post #20 of 354
another bubble / top signal ?

The number of IPOs in 2014's Q1 has topped the total for 1999 suspicious.gif
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