You might know someone who crows about the small fortune he or she made in a stock that was bought at a buck a share.
Ormaybeyouhave a pal who landed a huge profit in a stock that once traded a dime a share. Or perhaps you snatched shares of a company at a penny a share and can now brag
to your friends that you sold it thousands of percent higher.
That’s nice. But do you know anyone who has bought cheap stocks and turned a profit consistently?
As a growth-stock investor, you’re more likely to win long-term by focusing your time and money on institutional-quality stocks. IBD’s research of big winners over the past 100 years shows that these stocks not only trade at $30, $40 a share or
higher but that they possess the powerto double or triple in price.
Stock investing is filled with risk. Why boost that risk with penny stocks that can plunge as fast as they can rise in a single day? Don’t forget that the media pay little attention to scores of stocks that get delisted and become worthless.
The best growth stocks don’t hail from pink sheets or bulletin boards.They tend to already own a record of strong earnings and sales growth, a great product or service and a healthy balance sheet before they even begin their big moves in price.
Because of these characteristics, such stocks trade at a “higher” price due to strong demand by institutional investors. Mutual funds, hedge funds, pensions, banks and the investment units of large corporations have the serious money to invest
in companies that will grow in good times and survive in bad ones.
It’shard to resist acheapstock, because it appears the odds of making a profit are much higher. If you buy a stock at $1 a share, it just takes a one-point gain to double your money.Sounds great, right?
Here’s the problem: To see that one-point gain, you’re going to need at least one fund manager scooping up shares. The fund must also stand guard to support the stock if others dump their shares.
Large investors won’t buy a stock if they can’t invest with significant size. Let’s say a fund has $100 million to invest. Two percent of the fund—$2 million—is allocated for one stock.To buy a stock that trades at 50 cents a share, the fund must accumulate 4 million shares, and that assumes the stock price remains
steady. That might be the size of the company’s share float, leaving no
room for other buyers.
Since at least the late 1990s, securities regulators have clamped down on “pump and dump” schemes. A broker or someone posing as a broker would cold-call investors to recommend an ultra cheap stock, saying it would triple in a few weeks or
months. These fraudsters claim they have juicy inside information.
Now, the Internet is filled with newsletters touting stocks with promises that their prices will reach the moon. The SEC gives tips on its Web site, sec.gov, on how to
avoid such frauds. Any company with at least 500 investors and $10 million in net assets must submit filings to the commission.
In an IBD study of 84 market winners during the 2000 to 2008 period, the average price at the breakout was $34.79 per share. Sounds expensive? Well, the average
peak price for these superb stocks was $123.74 a share. It took, on average, 109 weeks for these stocks to hit their peak. The adjacent table shows a sample
of stocks that traded for at least $30 a share 12 months ago and logged
gains of at least 40% over the time frame. In all, 33 issues made the cut.
company, ticker, 12 month % price change, price 12 months ago, EPS, RS & SMR
Netflix NFLX 160 $45.00 97 78 A
Cree CREE 128 31.42 66 89 B
Priceline.com PCLN 123 131.32 99 90 A
Salesforce.com CRM 123 46.73 81 87 B
Bucyrus International BUCY 96 32.68 98 79 A
SL Green Realty SLG 93 32.48 22 91 C
Cimarex Energy XEC 91 37.94 14 76 B
Boston Beer Co. SAM 85 36.67 63 73 B
Concho Resources CXO 84 34.43 56 71 A
Jones Lang Lasalle JLL 81 45.05 44 83 C
Cognizant Tech CTSH 79 34.14 97 84 A
Cummins CMI 72 47.14 26 86 B
Chipotle Mexican Grill CMG 62 93.70 99 80 A
Lubrizol LZ 60 59.93 92 85 B
Wynn Resorts WYNN 60 58.47 61 83 B
WebMD Health WBMD 59 32.30 87 74 B
Apple AAPL 58 165.51 96 81 A
Portfolio Recovery PRAA 57 44.62 74 80 A
Polaris Industries PII 53 38.78 44 82 A
Amazon.com AMZN 51 85.32 65 71 A
Showing posts with label ibd. Show all posts
Showing posts with label ibd. Show all posts
Wednesday, August 11, 2010
Friday, March 26, 2010
Stocks Rise, Then Fizzle In Low Volume
For the second straight session, stocks began the day strong, then retreated to a slack finish.
After being up as much as 0.6%, the Nasdaq finished down 0.1% Friday. The S&P 500 and Dow inched up 0.1% each. The NYSE composite tacked on 0.2%.
Volume fell across the board.
The day's chief positive was that the ups and downs occurred in lower volume as the market consolidated its recent run-up.
The stock market didn't panic on news that a South Korean navy ship sank near North Korean waters. The cause was unclear.
Yet good news had little impact as well. Europe came to an agreement on how it would deal with Greece's debt crisis, but the boost from that was short-lived.
Although the market remains in a confirmed uptrend, the recent action — negative reversals and distribution in three of the past six sessions — is raising doubts.
The indexes have climbed to new highs this month and dozens of stocks have broken out, but only a few have risen sharply.
On Friday, action continued to be ho-hum for the leaders.
Such indecisiveness has defined this uptrend, keeping gains and losses in check. The market appears to be waiting for a catalyst that shows true conviction.
In a couple of weeks, earnings season will begin for the first quarter. That could reignite or toss cold water on the uptrend.
Still, there's always the possibility that nothing will significantly move this market. The rules for investing in a directionless market are the same as any other.
Sell any stock that drops 8% below your buy point. Don't let gains cycle into losses. Buy only during a market uptrend, and lock in gains in individual stocks when the chart gives sell signals.
The Dow was up 1% for the week, the Nasdaq 0.9%, the S&P 500 0.6% and the NYSE composite 0.2%.
After being up as much as 0.6%, the Nasdaq finished down 0.1% Friday. The S&P 500 and Dow inched up 0.1% each. The NYSE composite tacked on 0.2%.
Volume fell across the board.
The day's chief positive was that the ups and downs occurred in lower volume as the market consolidated its recent run-up.
The stock market didn't panic on news that a South Korean navy ship sank near North Korean waters. The cause was unclear.
Yet good news had little impact as well. Europe came to an agreement on how it would deal with Greece's debt crisis, but the boost from that was short-lived.
Although the market remains in a confirmed uptrend, the recent action — negative reversals and distribution in three of the past six sessions — is raising doubts.
The indexes have climbed to new highs this month and dozens of stocks have broken out, but only a few have risen sharply.
On Friday, action continued to be ho-hum for the leaders.
Such indecisiveness has defined this uptrend, keeping gains and losses in check. The market appears to be waiting for a catalyst that shows true conviction.
In a couple of weeks, earnings season will begin for the first quarter. That could reignite or toss cold water on the uptrend.
Still, there's always the possibility that nothing will significantly move this market. The rules for investing in a directionless market are the same as any other.
Sell any stock that drops 8% below your buy point. Don't let gains cycle into losses. Buy only during a market uptrend, and lock in gains in individual stocks when the chart gives sell signals.
The Dow was up 1% for the week, the Nasdaq 0.9%, the S&P 500 0.6% and the NYSE composite 0.2%.
Thursday, March 25, 2010
Negative Reversal Dashes Day's Early Bullish Action
The bulls were in charge early Thursday, but an apparent setback in Greece's debt crisis at midday sent the indexes tumbling.
Strong early gains stalled in mid-afternoon trade, first cutting the froth off the gains and then turning the indexes to losses on all but the Dow.
The NYSE composite slid 0.3%. The S&P 500 lost just under 0.2%. The Nasdaq edged down 0.1% and the Dow rose fractionally.
Volume was up on both major exchanges.
For the third time in the past five sessions, the market suffered distribution. The NYSE composite added another day of higher-volume losses to its count. The other indexes' losses were meager.
Still, the day's stalling action was bearish, even for the indexes that escaped outright distribution.
More days of institutional selling over the next couple of weeks could put the market's uptrend in question.
Strong earnings reports from Best Buy (BBY) and a sunny outlook from Qualcomm (QCOM) drove the early bullish action. Stocks also found help from better-than-expected jobless claims numbers and a report that France and Germany reached an agreement on a bailout for Greece.
The dollar weakened on the Greece news, boosting stocks.
But the report of a French-German agreement was undercut when European Central Bank President Jean-Claude Trichet said an IMF role in the bailout would be a bad precedent. That revived anxieties about the debt crisis. The dollar began to rise at midsession after Trichet's comment, and stocks started to struggle.
It was mostly down from there.
Some top-rated stocks notched sizable gains, but the technical action was flawed. Many gapped up but then finished low in the day's range. Some broke out and then slid underneath their buy points. A few held most of their gains.
Strong early gains stalled in mid-afternoon trade, first cutting the froth off the gains and then turning the indexes to losses on all but the Dow.
The NYSE composite slid 0.3%. The S&P 500 lost just under 0.2%. The Nasdaq edged down 0.1% and the Dow rose fractionally.
Volume was up on both major exchanges.
For the third time in the past five sessions, the market suffered distribution. The NYSE composite added another day of higher-volume losses to its count. The other indexes' losses were meager.
Still, the day's stalling action was bearish, even for the indexes that escaped outright distribution.
More days of institutional selling over the next couple of weeks could put the market's uptrend in question.
Strong earnings reports from Best Buy (BBY) and a sunny outlook from Qualcomm (QCOM) drove the early bullish action. Stocks also found help from better-than-expected jobless claims numbers and a report that France and Germany reached an agreement on a bailout for Greece.
The dollar weakened on the Greece news, boosting stocks.
But the report of a French-German agreement was undercut when European Central Bank President Jean-Claude Trichet said an IMF role in the bailout would be a bad precedent. That revived anxieties about the debt crisis. The dollar began to rise at midsession after Trichet's comment, and stocks started to struggle.
It was mostly down from there.
Some top-rated stocks notched sizable gains, but the technical action was flawed. Many gapped up but then finished low in the day's range. Some broke out and then slid underneath their buy points. A few held most of their gains.
Wednesday, March 24, 2010
Stocks Shrug Off Snags, End Higher In Mixed Trade
A late surge pushed indexes to close near session peaks Tuesday as all major indexes made closing highs for the year.
The Dow led, gaining 1%, with Caterpillar (CAT) heading the industrials. The NYSE and Nasdaq shared a 0.8% gain, pushing the Nasdaq to a 19-month high. The S&P 500 climbed 0.7% to a 17-month high. The NYSE composite made a new closing high for 2010, the first since Jan. 11.
Advancers outpaced declining stocks by about 2-to-1 for a second straight day.
Trading was lighter through most of the day. But the late surge pushed NYSE volume above Monday's total. Nasdaq volume ended a fraction lower.
As on Monday, markets rose despite early pressure from a rising dollar. Sovereign-debt problems in Europe continue to hurt the euro. But the dollar pared its gains as the session advanced, tracing a trajectory similar to Monday's.
Indexes flinched briefly at mid-morning after the National Association of Realtors reported existing home sales slipped in February as foreclosures rumbled ahead. The sales decline was less than expected, but the inventory of unsold homes swelled by 9.5%, the biggest jump in two years.
That raised the number of homes available for sale to an 8.6-month supply. The association's top economist called the increase in supply "unusual" and "discomforting," saying a 10-month supply would point to further declines in home prices.
In a jittery market, the news would have been enough to hurt stocks. Instead, homebuilders advanced.
The news was better for mining companies.
Mining equipment makers also rose on the news
The Dow led, gaining 1%, with Caterpillar (CAT) heading the industrials. The NYSE and Nasdaq shared a 0.8% gain, pushing the Nasdaq to a 19-month high. The S&P 500 climbed 0.7% to a 17-month high. The NYSE composite made a new closing high for 2010, the first since Jan. 11.
Advancers outpaced declining stocks by about 2-to-1 for a second straight day.
Trading was lighter through most of the day. But the late surge pushed NYSE volume above Monday's total. Nasdaq volume ended a fraction lower.
As on Monday, markets rose despite early pressure from a rising dollar. Sovereign-debt problems in Europe continue to hurt the euro. But the dollar pared its gains as the session advanced, tracing a trajectory similar to Monday's.
Indexes flinched briefly at mid-morning after the National Association of Realtors reported existing home sales slipped in February as foreclosures rumbled ahead. The sales decline was less than expected, but the inventory of unsold homes swelled by 9.5%, the biggest jump in two years.
That raised the number of homes available for sale to an 8.6-month supply. The association's top economist called the increase in supply "unusual" and "discomforting," saying a 10-month supply would point to further declines in home prices.
In a jittery market, the news would have been enough to hurt stocks. Instead, homebuilders advanced.
The news was better for mining companies.
Mining equipment makers also rose on the news
Friday, March 19, 2010
Stocks Tumble As Witching Lifts Trade
The new market uptrend faced its first serious loss Friday as stocks sold off while volume ballooned in a quadruple witching session.
The NYSE composite carved off 0.8%, the Nasdaq 0.7%, the S&P 500 0.5% and the Dow 0.3%.
Volume was up sharply on both major exchanges. Quadruple witching is the quarterly expiration of futures and options. It often leads to increased volatility and higher volume.
The action slapped all four major indexes with a distribution day. It was the first instance of institutional selling since the Nasdaq confirmed on March 1 that an uptrend was under way.
A distribution day is a price decline in a major index in higher volume than the prior session.
Although it points to institutional selling, a single day of distribution alone is not particularly worrisome. Also, the witching inflated volume Friday.
The market remains in a confirmed uptrend.
Indexes had been slowly climbing despite a load of worries.
Greece returned to the front burner Friday as a dispute developed in Europe on a potential bailout. Germany prefers that a bailout come from the International Monetary Fund. France advocates a European solution. The dollar strengthened vs. the euro on the uncertainty.
The rise in the dollar hurt most commodities. For the day, HMO and hospital stocks did well while oil, gold miners and semiconductor stocks fell.
Goldman Sachs added to the anxiety Friday when it cut estimates for banks and brokerages.
Meanwhile, India's central bank unexpectedly raised interest rates. This sharpened concerns that other nations will have to join the inflation fight, perhaps slowing the economic recovery. Earlier this month, Australia and Malaysia raised interest rates.
As President Obama's health legislation chugged toward a vote, industrial equipment maker Caterpillar (CAT) warned that the plan would cost the company $100 million in the first year alone.
The Dow added 1.1% for the week, the S&P 500 0.9%, and the Nasdaq and the NYSE composite 0.3% each.
The NYSE composite carved off 0.8%, the Nasdaq 0.7%, the S&P 500 0.5% and the Dow 0.3%.
Volume was up sharply on both major exchanges. Quadruple witching is the quarterly expiration of futures and options. It often leads to increased volatility and higher volume.
The action slapped all four major indexes with a distribution day. It was the first instance of institutional selling since the Nasdaq confirmed on March 1 that an uptrend was under way.
A distribution day is a price decline in a major index in higher volume than the prior session.
Although it points to institutional selling, a single day of distribution alone is not particularly worrisome. Also, the witching inflated volume Friday.
The market remains in a confirmed uptrend.
Indexes had been slowly climbing despite a load of worries.
Greece returned to the front burner Friday as a dispute developed in Europe on a potential bailout. Germany prefers that a bailout come from the International Monetary Fund. France advocates a European solution. The dollar strengthened vs. the euro on the uncertainty.
The rise in the dollar hurt most commodities. For the day, HMO and hospital stocks did well while oil, gold miners and semiconductor stocks fell.
Goldman Sachs added to the anxiety Friday when it cut estimates for banks and brokerages.
Meanwhile, India's central bank unexpectedly raised interest rates. This sharpened concerns that other nations will have to join the inflation fight, perhaps slowing the economic recovery. Earlier this month, Australia and Malaysia raised interest rates.
As President Obama's health legislation chugged toward a vote, industrial equipment maker Caterpillar (CAT) warned that the plan would cost the company $100 million in the first year alone.
The Dow added 1.1% for the week, the S&P 500 0.9%, and the Nasdaq and the NYSE composite 0.3% each.
Thursday, March 18, 2010
Indexes Mixed; Leaders, Volume Quiet
Volume eased Thursday as two of the four major indexes fell and the market continued its slow, steady uptrend.
The NYSE composite skidded 0.4%, while the S&P 500 fell fractionally. The Nasdaq added 0.1%, and the Dow rose 0.4%.
From a technical angle, those two declines were positive action. Since the March 1 follow-through day, at least one major index has shown accumulation in seven of the 14 sessions. Not one day has seen distribution.
That suggests institutional investors aren't eager to take profits.
For most leaders, it was a quiet session. Among the few top-rated stocks that moved in heavy volume, more fell than rose.
With no evidence of institutional selling, the market remains in a confirmed uptrend. Dozens of stocks have broken out since March 1, but only a handful have made double-digit gains.
One of the best-performing industry groups recently is career schools. Four stocks carry a best-possible 99 EPS Rating: DeVry (DV), Grand Canyon Education (LOPE), ITT Educational Services (ESI) and Capella Education (CPLA).
Economic news was generally positive Thursday. Inflation was lower than expected, leading indicators matched views, and the Philadelphia manufacturing index topped the consensus estimate. Jobless claims, though, were a little worse than expected.
Greece continued its back-and-forth economic soap opera — this time saying it might turn to the International Monetary Fund for a bailout if Europe doesn't provide one.
That weakened the euro, boosted the dollar and sent oil into retreat.
Gold futures and other precious metals also declined.
Among industry groups, medical stocks were among the day's leaders as President Obama pushed for passage of health legislation. The massive, 2,300-page bill will inevitably pick winners and losers, but it isn't clear yet who they will be or whether the legislation will pass Congress and then survive legal challenges.
Posted 05:11 PM ET U.S. Stocks Quiet After Hours; Witching Ahead
Few leading stocks were active in evening trading Thursday as the market looked to a quadruple witching session Friday.
The simultaneous expiration of contracts for stock index futures, stock index options, stock options and single stock futures occurs only four times a year. It usually results in volatile trading and higher volume.
The NYSE composite skidded 0.4%, while the S&P 500 fell fractionally. The Nasdaq added 0.1%, and the Dow rose 0.4%.
From a technical angle, those two declines were positive action. Since the March 1 follow-through day, at least one major index has shown accumulation in seven of the 14 sessions. Not one day has seen distribution.
That suggests institutional investors aren't eager to take profits.
For most leaders, it was a quiet session. Among the few top-rated stocks that moved in heavy volume, more fell than rose.
With no evidence of institutional selling, the market remains in a confirmed uptrend. Dozens of stocks have broken out since March 1, but only a handful have made double-digit gains.
One of the best-performing industry groups recently is career schools. Four stocks carry a best-possible 99 EPS Rating: DeVry (DV), Grand Canyon Education (LOPE), ITT Educational Services (ESI) and Capella Education (CPLA).
Economic news was generally positive Thursday. Inflation was lower than expected, leading indicators matched views, and the Philadelphia manufacturing index topped the consensus estimate. Jobless claims, though, were a little worse than expected.
Greece continued its back-and-forth economic soap opera — this time saying it might turn to the International Monetary Fund for a bailout if Europe doesn't provide one.
That weakened the euro, boosted the dollar and sent oil into retreat.
Gold futures and other precious metals also declined.
Among industry groups, medical stocks were among the day's leaders as President Obama pushed for passage of health legislation. The massive, 2,300-page bill will inevitably pick winners and losers, but it isn't clear yet who they will be or whether the legislation will pass Congress and then survive legal challenges.
Posted 05:11 PM ET U.S. Stocks Quiet After Hours; Witching Ahead
Few leading stocks were active in evening trading Thursday as the market looked to a quadruple witching session Friday.
The simultaneous expiration of contracts for stock index futures, stock index options, stock options and single stock futures occurs only four times a year. It usually results in volatile trading and higher volume.
Tuesday, March 16, 2010
Nasdaq, S&P Reach New Highs, But Leaders Quiet
The Nasdaq and S&P 500 rose to their highest levels in more than 17 months as the Federal Reserve's latest outlook encouraged the stock market Tuesday.
Stocks were up even before the Fed's afternoon announcement. After some volatility on the news, the major indexes rallied and closed near the day's highs.
The S&P 500 gained 0.8%, surpassing its January highs around 1150. The index also reached the highest level since October 2008. The Nasdaq advanced 0.7%, making its highest close since Aug. 28, 2008.
The NYSE composite jumped 1% as metals, energy and financials helped lead the market. The Dow climbed 0.4%.
Volume rose across the board, firming up the day's wins. In fact, nary a distribution day has occurred since the market follow-through on March 1.
Rather than stumbling on higher-volume declines, the market has notched several gains in higher volume, indicating institutional buying. Since the follow-through rally confirmation, the Nasdaq has four up days in higher volume, the S&P 500 has notched six and the NYSE seven.
But while the indexes acted bullishly Tuesday, leading stocks were generally quiet.
Some leaders that have been sluggish since their breakouts continued their lassitude.
Green Mountain Coffee Roasters (GMCR), Priceline (PCLN), Intuitive Surgical (ISRG)and Blue Coat Systems (BCSI) are some examples.
These are some upper-crust stocks that have been consolidating their recent gains. Still, dormant action isn't necessarily a sign of weakness, and few leaders have flashed sell signals.
A number of other leaders are making fruitful advances, such as Lululemon (LULU), Baidu (BIDU), Deckers Outdoor (DECK) and F5 Networks (FFIV).
Early Tuesday, the Commerce Department reported that housing starts slid 5.9% in February, but the figure was above forecasts. Homebuilders were among the day's best-performing industries. Embattled Greece cleared a hurdle as Standard & Poor's backed its deficit-reduction plan.
As expected, the Fed left interest rates unchanged and again said it planned to keep them near zero for an "extended period." The central bank saw business spending picking up and the job market "stabilizing."
The statement sent bond yields lower, which in turn hurt the dollar. With the greenback sliding, commodities climbed.
Posted 05:13 PM ET
Stocks were calm in after-hours trade Tuesday, following a solid finish in improved volume.
Investors will find no highly ranked stocks reporting late Tuesday or early Wednesday.
Upcoming economic reports are also minimal. The only major news to watch before tomorrow's open is the producer price index, which is scheduled to be released at 8:30 a.m. EDT. Consensus estimates for the month-to-month result are running at -0.2%. Excluding food and energy, analysts expect a rise of 0.1%.
Stocks were up even before the Fed's afternoon announcement. After some volatility on the news, the major indexes rallied and closed near the day's highs.
The S&P 500 gained 0.8%, surpassing its January highs around 1150. The index also reached the highest level since October 2008. The Nasdaq advanced 0.7%, making its highest close since Aug. 28, 2008.
The NYSE composite jumped 1% as metals, energy and financials helped lead the market. The Dow climbed 0.4%.
Volume rose across the board, firming up the day's wins. In fact, nary a distribution day has occurred since the market follow-through on March 1.
Rather than stumbling on higher-volume declines, the market has notched several gains in higher volume, indicating institutional buying. Since the follow-through rally confirmation, the Nasdaq has four up days in higher volume, the S&P 500 has notched six and the NYSE seven.
But while the indexes acted bullishly Tuesday, leading stocks were generally quiet.
Some leaders that have been sluggish since their breakouts continued their lassitude.
Green Mountain Coffee Roasters (GMCR), Priceline (PCLN), Intuitive Surgical (ISRG)and Blue Coat Systems (BCSI) are some examples.
These are some upper-crust stocks that have been consolidating their recent gains. Still, dormant action isn't necessarily a sign of weakness, and few leaders have flashed sell signals.
A number of other leaders are making fruitful advances, such as Lululemon (LULU), Baidu (BIDU), Deckers Outdoor (DECK) and F5 Networks (FFIV).
Early Tuesday, the Commerce Department reported that housing starts slid 5.9% in February, but the figure was above forecasts. Homebuilders were among the day's best-performing industries. Embattled Greece cleared a hurdle as Standard & Poor's backed its deficit-reduction plan.
As expected, the Fed left interest rates unchanged and again said it planned to keep them near zero for an "extended period." The central bank saw business spending picking up and the job market "stabilizing."
The statement sent bond yields lower, which in turn hurt the dollar. With the greenback sliding, commodities climbed.
Posted 05:13 PM ET
Stocks were calm in after-hours trade Tuesday, following a solid finish in improved volume.
Investors will find no highly ranked stocks reporting late Tuesday or early Wednesday.
Upcoming economic reports are also minimal. The only major news to watch before tomorrow's open is the producer price index, which is scheduled to be released at 8:30 a.m. EDT. Consensus estimates for the month-to-month result are running at -0.2%. Excluding food and energy, analysts expect a rise of 0.1%.
Friday, March 12, 2010
Stocks End Nearly Flat; Volume Is Mixed
The indexes hovered around the break-even point much of Friday's session before settling narrowly mixed.
The NYSE composite and the Dow added 0.1% each. The S&P 500 and the Nasdaq were both fractionally lower.
Volume fell 4% on the Nasdaq and rose 7% on the NYSE. It was the second time last week that the NYSE composite and Dow indexes, neither of which is leading this uptrend, stalled with tiny gains in higher volume.
In Friday's edition, we noted that the S&P 500 was approaching a technical test near its previous high at 1150.45. While it passed it intraday, it couldn't hold the gain. The action, however, left it in position for a second try.
Friday marked exactly one year since the follow-through day that confirmed a new uptrend was under way. It proved to be the end of the bear market. After the follow-through day, the Nasdaq gained 66% through Friday, tops among the major indexes.
Although the Nasdaq's performance was impressive in the past 12 months, investors who bought top-rated stocks offering valid entry points conceivably could've done better.
Stocks that bagged huge gains in the past 12 months include China Automotive Systems (CAAS) (up 607%), Bucyrus International (BUCY) (380%), Intuitive Surgical (ISRG) (248%), Green Mountain Coffee Roasters (GMCR) (238%), Baidu (BIDU) (225%) and Apple (AAPL) ( 135%).
Of course, no one would've captured all of the gains in these stocks because waiting for a proper entry point naturally sacrifices part of the gain. The benefit to waiting is that you avoid losing money and time on issues that never finish a base and break out.
On Friday, breakouts were scarce.
Before Friday's open, some good news on retail sales rolled in. While the Street expected a slight dip in February retail sales, the sector delivered a 0.3% pop. Ex autos and gasoline, retail sales were up 0.9%, far above estimates.
The major indexes opened higher but the move didn't hold for long. A consumer sentiment gauge fell short of estimates and business inventories also disappointed.
Posted 05:10 PM ET
Stocks took a breather Friday, finishing little changed after a dull session. Mixed economic reports failed to move the major indexes much either way. Retail sales unexpectedly rose, but consumer sentiment surprisingly fell.
The Dow and NYSE composite inched up 0.1% each. The Nasdaq and S&P 500 both eased a fraction.
NYSE volume climbed, while Nasdaq trade fell.
Despite Friday's lack of action, stocks finished higher for the second straight week. The Nasdaq climbed 2% and Dow 0.6%. The NYSE composite and S&P 500 rose 1% each.
The NYSE composite and the Dow added 0.1% each. The S&P 500 and the Nasdaq were both fractionally lower.
Volume fell 4% on the Nasdaq and rose 7% on the NYSE. It was the second time last week that the NYSE composite and Dow indexes, neither of which is leading this uptrend, stalled with tiny gains in higher volume.
In Friday's edition, we noted that the S&P 500 was approaching a technical test near its previous high at 1150.45. While it passed it intraday, it couldn't hold the gain. The action, however, left it in position for a second try.
Friday marked exactly one year since the follow-through day that confirmed a new uptrend was under way. It proved to be the end of the bear market. After the follow-through day, the Nasdaq gained 66% through Friday, tops among the major indexes.
Although the Nasdaq's performance was impressive in the past 12 months, investors who bought top-rated stocks offering valid entry points conceivably could've done better.
Stocks that bagged huge gains in the past 12 months include China Automotive Systems (CAAS) (up 607%), Bucyrus International (BUCY) (380%), Intuitive Surgical (ISRG) (248%), Green Mountain Coffee Roasters (GMCR) (238%), Baidu (BIDU) (225%) and Apple (AAPL) ( 135%).
Of course, no one would've captured all of the gains in these stocks because waiting for a proper entry point naturally sacrifices part of the gain. The benefit to waiting is that you avoid losing money and time on issues that never finish a base and break out.
On Friday, breakouts were scarce.
Before Friday's open, some good news on retail sales rolled in. While the Street expected a slight dip in February retail sales, the sector delivered a 0.3% pop. Ex autos and gasoline, retail sales were up 0.9%, far above estimates.
The major indexes opened higher but the move didn't hold for long. A consumer sentiment gauge fell short of estimates and business inventories also disappointed.
Posted 05:10 PM ET
Stocks took a breather Friday, finishing little changed after a dull session. Mixed economic reports failed to move the major indexes much either way. Retail sales unexpectedly rose, but consumer sentiment surprisingly fell.
The Dow and NYSE composite inched up 0.1% each. The Nasdaq and S&P 500 both eased a fraction.
NYSE volume climbed, while Nasdaq trade fell.
Despite Friday's lack of action, stocks finished higher for the second straight week. The Nasdaq climbed 2% and Dow 0.6%. The NYSE composite and S&P 500 rose 1% each.
Thursday, March 11, 2010
Indexes Stage Positive Reversal, Though Volume Dips
The bulls won a low-volume battle Thursday.
Stocks spent most of the session in the red, and then moved up quickly in the last hour of trade. While the positive reversal was welcomed, the slower trade suggested that institutional investors were taking a timeout.
The Nasdaq, S&P 500 and Dow each finished 0.4% higher. The NYSE composite added 0.3%.
Volume was lower on both major exchanges.
Economic news had little impact Thursday. Jobless claims were a little worse than expected. February foreclosures showed the smallest jump in some time, but the rise was still 6%. A report of inflation jumping in China was bad news, but the market eventually shrugged it off.
Technical action during the session was good, with the early weakness coming in light trade, the rebound in better volume. The indexes closed near their session highs — another positive note.
Good technical action has been typical since the market uptrend was confirmed March 1. There hasn't been a day of distribution in a major index. Plus, the Nasdaq has made a new high several sessions in a row.
The breadth of the gains also has been positive. The NYSE advance/decline line is making new highs; the Nasdaq's advance/decline line is near a new high.
A technical test, however, looms for the S&P 500. On Thursday, it closed just under its previous high at 1150.45, set on Jan. 19. The Street will be watching to see if it can break through that level or if it will find resistance there.
Action was slow among leading stocks Thursday, with few going up or down significantly in strong volume.
With the confirmed uptrend nine sessions old, it might be useful to look at how recent breakouts are faring.
More than three dozen high-rated stocks have broken out. That's a healthy number, but not all are true leaders. Three have triggered the 8% sell rule — Harbin, thinly traded fiber-optics firm AboveNet (ABVT) and security software provider ArcSight (ARST).
Most breakouts are modestly up from the buy point. A few are modestly down.
So far this month, small caps have led the market's new uptrend. The small-cap S&P 600 is up 7.2% in March. The Nasdaq is up 5.8%, the best gain among the major indexes.
The Nasdaq's Accumulation/Distribution Rating also is ahead of the other major indexes'. After languishing a while, some of those ratings are improving.
Posted 05:08 PM ET
Stocks shrugged off Chinese inflation news and a smaller-than-expected drop in initial jobless claims Thursday. Indexes wavered for most of the session, but buying came in during the final hour of trading.
The Nasdaq rallied 0.4%, closing at its session high. That marked its sixth straight gain. The Dow and the S&P 500 also rose 0.4% each. The S&P closed near its January peak. The NYSE composite gained 0.3%.
Despite the late push, volume fell sharply across the board.
Stocks spent most of the session in the red, and then moved up quickly in the last hour of trade. While the positive reversal was welcomed, the slower trade suggested that institutional investors were taking a timeout.
The Nasdaq, S&P 500 and Dow each finished 0.4% higher. The NYSE composite added 0.3%.
Volume was lower on both major exchanges.
Economic news had little impact Thursday. Jobless claims were a little worse than expected. February foreclosures showed the smallest jump in some time, but the rise was still 6%. A report of inflation jumping in China was bad news, but the market eventually shrugged it off.
Technical action during the session was good, with the early weakness coming in light trade, the rebound in better volume. The indexes closed near their session highs — another positive note.
Good technical action has been typical since the market uptrend was confirmed March 1. There hasn't been a day of distribution in a major index. Plus, the Nasdaq has made a new high several sessions in a row.
The breadth of the gains also has been positive. The NYSE advance/decline line is making new highs; the Nasdaq's advance/decline line is near a new high.
A technical test, however, looms for the S&P 500. On Thursday, it closed just under its previous high at 1150.45, set on Jan. 19. The Street will be watching to see if it can break through that level or if it will find resistance there.
Action was slow among leading stocks Thursday, with few going up or down significantly in strong volume.
With the confirmed uptrend nine sessions old, it might be useful to look at how recent breakouts are faring.
More than three dozen high-rated stocks have broken out. That's a healthy number, but not all are true leaders. Three have triggered the 8% sell rule — Harbin, thinly traded fiber-optics firm AboveNet (ABVT) and security software provider ArcSight (ARST).
Most breakouts are modestly up from the buy point. A few are modestly down.
So far this month, small caps have led the market's new uptrend. The small-cap S&P 600 is up 7.2% in March. The Nasdaq is up 5.8%, the best gain among the major indexes.
The Nasdaq's Accumulation/Distribution Rating also is ahead of the other major indexes'. After languishing a while, some of those ratings are improving.
Posted 05:08 PM ET
Stocks shrugged off Chinese inflation news and a smaller-than-expected drop in initial jobless claims Thursday. Indexes wavered for most of the session, but buying came in during the final hour of trading.
The Nasdaq rallied 0.4%, closing at its session high. That marked its sixth straight gain. The Dow and the S&P 500 also rose 0.4% each. The S&P closed near its January peak. The NYSE composite gained 0.3%.
Despite the late push, volume fell sharply across the board.
Tuesday, March 9, 2010
Stocks Surrender Gains Late, Close Modestly Higher
Stocks faced an onslaught of late selling Tuesday, giving up some gains to close modestly higher.
The Nasdaq closed atop the heap with a 0.4% gain after being up as much as 0.9% earlier. The S&P 500 and the Dow gained 0.2% and 0.1%, respectively. The NYSE composite kept a toehold in positive territory.
Volume rose across the board. But much of the trading took place as the market slid, a negative sign for the market.
Normally, higher volume on a day when the market climbs is encouraging. But the swelling volume as indexes retreated cast doubts.
In fact, the indexes' lackluster gains in higher volume resembled stalling action.
Results among leading stocks were mixed.
So what fueled Monday's action?
Transportation issues were one of the day's big beneficiaries. The Dow transports jumped 1.3%.
05:15 PM ET
Stocks closed up on this anniversary of the March 2009 market bottom. But a round of late selling erased the bulk of the day's gains.
The Nasdaq closed atop the heap with a 0.4% gain after being up as much as 0.9% earlier. The S&P 500 and the Dow gained 0.2% and 0.1%, respectively. The NYSE composite kept a toehold in positive territory.
Volume rose across the board. But much of the trading took place as the market slid, a negative sign for the market.
Normally, higher volume on a day when the market climbs is encouraging. But the swelling volume as indexes retreated cast doubts.
In fact, the indexes' lackluster gains in higher volume resembled stalling action.
Results among leading stocks were mixed.
So what fueled Monday's action?
Transportation issues were one of the day's big beneficiaries. The Dow transports jumped 1.3%.
05:15 PM ET
Stocks closed up on this anniversary of the March 2009 market bottom. But a round of late selling erased the bulk of the day's gains.
Friday, March 5, 2010
Stocks Jump As More Leaders Break Out
Stocks strode ahead confidently Friday, and a handful of breakouts added to the bullish tone.
The NYSE composite added 1.6%, the Nasdaq 1.5%, the S&P 500 1.4% and the Dow 1.2%.
Volume rose 10% on the Nasdaq and the NYSE, solidifying the day's gains.
Friday's advance served as a shot in the arm for the market, which had been sluggish after a follow-through a week ago.
The Nasdaq — which is leading the new market uptrend — made a fresh closing high for the year.
Some nervousness preceded Friday's session as investors awaited the government numbers on nonfarm payrolls and the unemployment rate.
About an hour before the open, the Street got the report.
Employers cut fewer jobs than expected in February, and the unemployment rate remained unchanged. Analysts had expected the jobless rate to edge up.
The details left plenty of room to parse meaning. Bulls could point to employment in retail and manufacturing, both of which were unchanged. Bears could emphasize that the only sectors adding jobs were temporary help services and the federal government.
As usual, the market itself decided the dispute, siding with the bulls on this occasion.
Of the industry groups, nearly all rose. The leisure products group was the top gainer, with several of its members rising 4% to 6%.
Building, retail, technology and metals rounded out the leaders.
Apart from those solid gains, another potential plus is developing in the background.
A few highly rated stocks formed bases during the correction that undercut previous bases. That resets the base count, meaning they are now first-stage patterns. A first-stage base is more likely to work than later bases.
posted 05:15 PM ET
Stocks chopped around for the past three sessions, but finished decisively high Friday, thanks to a jobs report that showed that the labor market is on the mend.
The NYSE composite climbed 1.6%, closing at its best level since Jan. 20. The Nasdaq passed its January peak, gaining 1.5% to touch its highest level since September 2008. The S&P 500 and Dow rose 1.4% and 1.2%, respectively.
Volume climbed on both exchanges.
Before the open, the Labor Department said employers cut far fewer jobs in February than economists had expected. The unemployment rate held steady at 9.7%.
For the week, the Nasdaq and NYSE composite surged 3.9% and 3.6%, respectively. Both put in their best weekly performance of the year. The S&P 500 gained 3.1%, while the Dow added 2.3%.
The NYSE composite added 1.6%, the Nasdaq 1.5%, the S&P 500 1.4% and the Dow 1.2%.
Volume rose 10% on the Nasdaq and the NYSE, solidifying the day's gains.
Friday's advance served as a shot in the arm for the market, which had been sluggish after a follow-through a week ago.
The Nasdaq — which is leading the new market uptrend — made a fresh closing high for the year.
Some nervousness preceded Friday's session as investors awaited the government numbers on nonfarm payrolls and the unemployment rate.
About an hour before the open, the Street got the report.
Employers cut fewer jobs than expected in February, and the unemployment rate remained unchanged. Analysts had expected the jobless rate to edge up.
The details left plenty of room to parse meaning. Bulls could point to employment in retail and manufacturing, both of which were unchanged. Bears could emphasize that the only sectors adding jobs were temporary help services and the federal government.
As usual, the market itself decided the dispute, siding with the bulls on this occasion.
Of the industry groups, nearly all rose. The leisure products group was the top gainer, with several of its members rising 4% to 6%.
Building, retail, technology and metals rounded out the leaders.
Apart from those solid gains, another potential plus is developing in the background.
A few highly rated stocks formed bases during the correction that undercut previous bases. That resets the base count, meaning they are now first-stage patterns. A first-stage base is more likely to work than later bases.
posted 05:15 PM ET
Stocks chopped around for the past three sessions, but finished decisively high Friday, thanks to a jobs report that showed that the labor market is on the mend.
The NYSE composite climbed 1.6%, closing at its best level since Jan. 20. The Nasdaq passed its January peak, gaining 1.5% to touch its highest level since September 2008. The S&P 500 and Dow rose 1.4% and 1.2%, respectively.
Volume climbed on both exchanges.
Before the open, the Labor Department said employers cut far fewer jobs in February than economists had expected. The unemployment rate held steady at 9.7%.
For the week, the Nasdaq and NYSE composite surged 3.9% and 3.6%, respectively. Both put in their best weekly performance of the year. The S&P 500 gained 3.1%, while the Dow added 2.3%.
Indexes Rise, But Top Stocks Show Little Leadership
Stocks rose moderately Thursday in mixed volume, as most indexes closed in better form than in the previous couple of days.
The Nasdaq and Dow rose 0.5% each. The S&P 500 added 0.4%. The NYSE composite trailed with a 0.1% gain. The Nasdaq, S&P 500 and Dow closed near session highs.
Volume fell on the Nasdaq but edged up on the NYSE. Market watchers attributed the unimpressive volume to traders awaiting Friday's unemployment numbers.
It was a relatively quiet session for all but a few top-rated stocks.
Since Monday's follow-through, the indexes have essentially moved sideways. While breakouts have occurred and few have failed outright, only a handful has made much headway.
Those that broke out and added to the initial gain include cloud computing firm F5 Networks (FFIV); Applebee's and IHOP operator and franchiser DineEquity (DIN), which is thinly traded; and Israeli medical-equipment developer Given Imaging (GIVN), also a thinly traded stock.
Breakouts Thursday included thinly traded pharmacy benefits manager SXC Health Solutions (SXCI) and discount apparel store chain Ross Stores (ROST).
SXC roared 15% in heavy trade after beating quarterly estimates on earnings and sales. It also raised 2010 guidance above analysts' expectations.
SXC cleared a base and is now 4% past its 56.30 buy point.
Ross Stores reported that February same-store sales rose almost twice as much as the Street expected. The stock jumped past a 50.60 buy point in volume 29% greater than usual.
Action in Green Mountain Coffee Roasters (GMCR) is more typical of recent breakouts. It cleared an 88.75 buy point intraday Tuesday but closed below it. It did the same Wednesday and closed basically flat Thursday.
Such action isn't a sell signal, but it's indecisive enough to raise doubts.
Other stocks are still in the base-building process.
Retailer Urban Outfitters (URBN) is building the right side of a base. It added 0.94 to 34.34 Thursday in 28% faster trade. The company is showing signs of a potential turnaround. Before Thursday's open, it reported quarterly results, topping expectations.
Earnings leapt 88%, the best gain in at least 19 quarters. Sales rose 16%, the best in five quarters. After-tax profit margin was 13%, the best in at least 19 quarters.
Mutual funds added shares in Urban Outfitters in Q4.
Economic news was mixed Thursday. Results were encouraging on initial jobless claims and on retail same-store sales.
Apparel, discount and other retail industry groups were among the day's best performers.
But factory orders and pending home sales in February were worse than expected.
After hours, computer security provider ArcSight (ARST) plunged 9% after it topped views on revenue but missed on earnings. It has broken out of a cup with handle, but that move is now in doubt.
5:15 p.m. Update: Stocks swung back and forth, finishing higher ahead of Friday's key jobs report.
The Nasdaq bounced back from a 0.3% deficit to end up 0.5%. The Dow also rose 0.5%, thanks to gains by Boeing (BA), Walt Disney (DIS) and American Express (AXP).
Meanwhile, the S&P 500 rose 0.4% and the NYSE composite 0.1%.
Volume ticked up on the NYSE and dropped sharply on the Nasdaq.
The all-important February jobs report will be out before Friday's open. Economists are expecting a loss of 63,000 jobs. The unemployment rate is slated to tick up to 9.8% from 9.7% in January.
The Nasdaq and Dow rose 0.5% each. The S&P 500 added 0.4%. The NYSE composite trailed with a 0.1% gain. The Nasdaq, S&P 500 and Dow closed near session highs.
Volume fell on the Nasdaq but edged up on the NYSE. Market watchers attributed the unimpressive volume to traders awaiting Friday's unemployment numbers.
It was a relatively quiet session for all but a few top-rated stocks.
Since Monday's follow-through, the indexes have essentially moved sideways. While breakouts have occurred and few have failed outright, only a handful has made much headway.
Those that broke out and added to the initial gain include cloud computing firm F5 Networks (FFIV); Applebee's and IHOP operator and franchiser DineEquity (DIN), which is thinly traded; and Israeli medical-equipment developer Given Imaging (GIVN), also a thinly traded stock.
Breakouts Thursday included thinly traded pharmacy benefits manager SXC Health Solutions (SXCI) and discount apparel store chain Ross Stores (ROST).
SXC roared 15% in heavy trade after beating quarterly estimates on earnings and sales. It also raised 2010 guidance above analysts' expectations.
SXC cleared a base and is now 4% past its 56.30 buy point.
Ross Stores reported that February same-store sales rose almost twice as much as the Street expected. The stock jumped past a 50.60 buy point in volume 29% greater than usual.
Action in Green Mountain Coffee Roasters (GMCR) is more typical of recent breakouts. It cleared an 88.75 buy point intraday Tuesday but closed below it. It did the same Wednesday and closed basically flat Thursday.
Such action isn't a sell signal, but it's indecisive enough to raise doubts.
Other stocks are still in the base-building process.
Retailer Urban Outfitters (URBN) is building the right side of a base. It added 0.94 to 34.34 Thursday in 28% faster trade. The company is showing signs of a potential turnaround. Before Thursday's open, it reported quarterly results, topping expectations.
Earnings leapt 88%, the best gain in at least 19 quarters. Sales rose 16%, the best in five quarters. After-tax profit margin was 13%, the best in at least 19 quarters.
Mutual funds added shares in Urban Outfitters in Q4.
Economic news was mixed Thursday. Results were encouraging on initial jobless claims and on retail same-store sales.
Apparel, discount and other retail industry groups were among the day's best performers.
But factory orders and pending home sales in February were worse than expected.
After hours, computer security provider ArcSight (ARST) plunged 9% after it topped views on revenue but missed on earnings. It has broken out of a cup with handle, but that move is now in doubt.
5:15 p.m. Update: Stocks swung back and forth, finishing higher ahead of Friday's key jobs report.
The Nasdaq bounced back from a 0.3% deficit to end up 0.5%. The Dow also rose 0.5%, thanks to gains by Boeing (BA), Walt Disney (DIS) and American Express (AXP).
Meanwhile, the S&P 500 rose 0.4% and the NYSE composite 0.1%.
Volume ticked up on the NYSE and dropped sharply on the Nasdaq.
The all-important February jobs report will be out before Friday's open. Economists are expecting a loss of 63,000 jobs. The unemployment rate is slated to tick up to 9.8% from 9.7% in January.
Tuesday, March 2, 2010
Stocks Start Strong, But Finish Weak
First the good: Stocks rose for the third straight session Tuesday. The bad: They closed well off the session's best levels.
The NYSE composite rose 0.5% and closed above its 50-day moving average. But the index was up as much as 0.9%. The Nasdaq gained 0.3%, down from 0.8% at its intraday peak. Meanwhile, the S&P 500 edged up 0.2% and the Dow eked up a fraction.
Volume rose on both major exchanges.
The market started off strong, thanks to more bailout optimism for Greece and more M&A news. Greek lawmakers are expected to announce new efforts Wednesday to cut its heavy debt.
The dollar fell against the euro and the yen, but pared losses just before 1 p.m. EST. Stocks faded soon after that. The Dow dipped into negative territory before bouncing back a bit.
Considering Monday's follow-through session, Tuesday's fading conclusion was a letdown.
But the indexes' gains were enough to avoid a distribution day, which would have clouded the market's picture considerably. Also, some leaders fared well.
The NYSE composite rose 0.5% and closed above its 50-day moving average. But the index was up as much as 0.9%. The Nasdaq gained 0.3%, down from 0.8% at its intraday peak. Meanwhile, the S&P 500 edged up 0.2% and the Dow eked up a fraction.
Volume rose on both major exchanges.
The market started off strong, thanks to more bailout optimism for Greece and more M&A news. Greek lawmakers are expected to announce new efforts Wednesday to cut its heavy debt.
The dollar fell against the euro and the yen, but pared losses just before 1 p.m. EST. Stocks faded soon after that. The Dow dipped into negative territory before bouncing back a bit.
Considering Monday's follow-through session, Tuesday's fading conclusion was a letdown.
But the indexes' gains were enough to avoid a distribution day, which would have clouded the market's picture considerably. Also, some leaders fared well.
Friday, February 26, 2010
U.S. Stocks Rise Despite Mixed Economic Reports
Stocks Inch Ahead In Mixed Volume
Stocks edged up Friday, trading in a narrow range in mixed volume.
The NYSE composite led with a 0.3% advance. The Nasdaq added 0.2%, the S&P 500 0.1% and the Dow was fractionally higher.
Volume was down on the Nasdaq but up on the NYSE.
Economic news also was mixed. On the plus side, the revised fourth-quarter GDP number was stronger than expected. Manufacturing and business activity reports in Chicago and New York also topped estimates. But existing home sales and a consumer sentiment index missed views.
None of the data did much to move the market's needle.
The Nasdaq did inch over its 50-day moving average, but the other major indexes remained below that key level.
For the week, the Nasdaq fell 0.2%, as the Dow and the NYSE composite lost 0.7% each, and the S&P 500 eased 0.4%.
Among top-rated stocks, action had a positive bent Friday.
Nothing in Friday's session changed the market's lethargic situation.
After a healthy run from mid-July to mid-September, stocks have languished in a choppy pattern. In the past five months, the Nasdaq has suffered far more down weeks in above-average trade than up weeks in above-average volume.
And although the Nasdaq has bounced more than 6% off its recent low in the past three weeks, its Accumulation/Distribution Rating remains stuck at a worst-possible E.
The best that can be said of this market is that a number of strong stocks are setting up in bases.
With the market in a correction, it's best to focus on your watch lists. Buy no stocks until the market delivers a follow-through day.
Yet, a positive sign emerged recently. Some stocks with high Composite Ratings broke out in the past three weeks. They appear to be holding together, if not necessarily soaring.
Oil and gold both rose Friday.
5:15 p.m. Update: Stocks finished with small gains Friday after a slew of mixed economic data.
The NYSE composite rose 0.3%, Nasdaq 0.2% and S&P 500 0.1%. The Dow inched up a fraction.
Volume fell on the Nasdaq and rose on the NYSE.
The second estimate of the fourth-quarter 2009 GDP came in higher than previously thought and was above views. But the spending component was weaker than expected.
The Chicago PMI unexpectedly rose. But sentiment and housing data came in below economists' estimates.
Stocks dipped on the week, but finished the month on the plus side. The Nasdaq jumped 4.2%, S&P 500 2.8%, Dow 2.6% and NYSE composite 2.2%.
Stocks edged up Friday, trading in a narrow range in mixed volume.
The NYSE composite led with a 0.3% advance. The Nasdaq added 0.2%, the S&P 500 0.1% and the Dow was fractionally higher.
Volume was down on the Nasdaq but up on the NYSE.
Economic news also was mixed. On the plus side, the revised fourth-quarter GDP number was stronger than expected. Manufacturing and business activity reports in Chicago and New York also topped estimates. But existing home sales and a consumer sentiment index missed views.
None of the data did much to move the market's needle.
The Nasdaq did inch over its 50-day moving average, but the other major indexes remained below that key level.
For the week, the Nasdaq fell 0.2%, as the Dow and the NYSE composite lost 0.7% each, and the S&P 500 eased 0.4%.
Among top-rated stocks, action had a positive bent Friday.
Nothing in Friday's session changed the market's lethargic situation.
After a healthy run from mid-July to mid-September, stocks have languished in a choppy pattern. In the past five months, the Nasdaq has suffered far more down weeks in above-average trade than up weeks in above-average volume.
And although the Nasdaq has bounced more than 6% off its recent low in the past three weeks, its Accumulation/Distribution Rating remains stuck at a worst-possible E.
The best that can be said of this market is that a number of strong stocks are setting up in bases.
With the market in a correction, it's best to focus on your watch lists. Buy no stocks until the market delivers a follow-through day.
Yet, a positive sign emerged recently. Some stocks with high Composite Ratings broke out in the past three weeks. They appear to be holding together, if not necessarily soaring.
Oil and gold both rose Friday.
5:15 p.m. Update: Stocks finished with small gains Friday after a slew of mixed economic data.
The NYSE composite rose 0.3%, Nasdaq 0.2% and S&P 500 0.1%. The Dow inched up a fraction.
Volume fell on the Nasdaq and rose on the NYSE.
The second estimate of the fourth-quarter 2009 GDP came in higher than previously thought and was above views. But the spending component was weaker than expected.
The Chicago PMI unexpectedly rose. But sentiment and housing data came in below economists' estimates.
Stocks dipped on the week, but finished the month on the plus side. The Nasdaq jumped 4.2%, S&P 500 2.8%, Dow 2.6% and NYSE composite 2.2%.
Thursday, February 25, 2010
Stocks Wipe Out Most Of Losses But Still End Lower
Stocks turned what was shaping up as an ugly day into a so-so outcome Thursday.
After slipping almost 2%, the indexes climbed in the afternoon, wiping out most of their losses.
Volume was up across the board and accelerated during the rebound. The late pickup in activity was a positive sign
The Nasdaq finished 0.1% down. The S&P 500 and the NYSE composite shaved 0.2% each. The Dow carved off 0.5%
While the market's rebound was encouraging, the mixed signals continue. Institutional buying is scarce: The major indexes' Accumulation/Distribution Ratings remain at the lowest possible level.
Action among leading stocks, however, was generally positive
But with the market in a correction, it's best to avoid buying any stock. The odds are not in the buyer's favor.
In economic news, first-time jobless claims came in worse than expected. Durable goods orders ex transportation also missed views. And anxiety over Greece rose as fears grew that rating agencies would cut ratings on Greece.
Energy stocks were among the day's worst as prices of crude futures slumped back below $80 a barrel.
U.S. Stocks Fall, Trim Most Losses
5:15 p.m. Update: Greek debt woes and some worse-than-expected economic data slammed stocks Thursday, but equities finished well off their worst levels of the session.
The Dow pared a 1.8% shortfall to 0.5%. The NYSE composite and S&P 500 dipped 0.2% each. Meanwhile, the Nasdaq slipped 0.1%.
Volume climbed across the board.
Stocks tumbled out of the gate after Moody's Investor Services threatened to downgrade Greece's debt ratings. Standard & Poor's warned of a downgrade late Wednesday. Weekly jobless claims came in worse than expected, while durable goods orders ex transportation unexpectedly fell.
Overall, leaders down in heavy volume were few
Economic reports Friday include Q4 revised GDP, Chicago PMI, Michigan sentiment index and existing-home sales.
After slipping almost 2%, the indexes climbed in the afternoon, wiping out most of their losses.
Volume was up across the board and accelerated during the rebound. The late pickup in activity was a positive sign
The Nasdaq finished 0.1% down. The S&P 500 and the NYSE composite shaved 0.2% each. The Dow carved off 0.5%
While the market's rebound was encouraging, the mixed signals continue. Institutional buying is scarce: The major indexes' Accumulation/Distribution Ratings remain at the lowest possible level.
Action among leading stocks, however, was generally positive
But with the market in a correction, it's best to avoid buying any stock. The odds are not in the buyer's favor.
In economic news, first-time jobless claims came in worse than expected. Durable goods orders ex transportation also missed views. And anxiety over Greece rose as fears grew that rating agencies would cut ratings on Greece.
Energy stocks were among the day's worst as prices of crude futures slumped back below $80 a barrel.
U.S. Stocks Fall, Trim Most Losses
5:15 p.m. Update: Greek debt woes and some worse-than-expected economic data slammed stocks Thursday, but equities finished well off their worst levels of the session.
The Dow pared a 1.8% shortfall to 0.5%. The NYSE composite and S&P 500 dipped 0.2% each. Meanwhile, the Nasdaq slipped 0.1%.
Volume climbed across the board.
Stocks tumbled out of the gate after Moody's Investor Services threatened to downgrade Greece's debt ratings. Standard & Poor's warned of a downgrade late Wednesday. Weekly jobless claims came in worse than expected, while durable goods orders ex transportation unexpectedly fell.
Overall, leaders down in heavy volume were few
Economic reports Friday include Q4 revised GDP, Chicago PMI, Michigan sentiment index and existing-home sales.
Wednesday, February 24, 2010
Stocks Stage Hollow Bounce As Volume Declines
Stocks took a whiffle-ball bounce Wednesday, rising in light trade after Fed chief Ben Bernanke reiterated a pledge to keep interest rates low.
The Nasdaq and the S&P 500 led, up 1% each. The Dow took a 0.9% gain and the NYSE composite climbed 0.8%.
Volume remained soft on both major exchanges.
While the market's bounce looked good in terms of price performance, the lack of volume was disappointing. It showed the market continuing its attempted rally in mostly light volume.
The behavior is a signal to hold on to your cash and avoid buying stocks for the time being. Even if a stock has the right pedigree and a good breakout, the market has yet to make a follow-through rally confirmation.
Still, the market showed some resilience Wednesday, rising despite the midmorning news that new home sales fell for a third straight month in January, off 11%, to a record low.
Bernanke told a congressional panel that the Federal Reserve planned to keep interest rates low for "an extended period."
The dollar also had an impact. It pulled back after a bounce on Tuesday. That helped boost oil $1, to just below $80 a barrel. Gold rose less than 1% to near its recent resistance around $1,100 an ounce.
Earnings news stirred much of the day's other action.
U.S. Stocks Bounce Back, But Volume Lags
5:15 p.m. Update: Stocks rose for the first time in three sessions Wednesday, as Federal Reserve Chairman Ben Bernanke pledged to keep interest rates low for an "extended period" of time.
The Nasdaq climbed 1%, closing back above its 50-day moving average by a narrow margin. The S&P 500 also gained 1%, but finished slightly below its 50-day line. Meanwhile, the Dow and NYSE composite rose 0.9% and 0.8%, respectively.
Volume fell on both exchanges, mitigating the comeback.
The Nasdaq and the S&P 500 led, up 1% each. The Dow took a 0.9% gain and the NYSE composite climbed 0.8%.
Volume remained soft on both major exchanges.
While the market's bounce looked good in terms of price performance, the lack of volume was disappointing. It showed the market continuing its attempted rally in mostly light volume.
The behavior is a signal to hold on to your cash and avoid buying stocks for the time being. Even if a stock has the right pedigree and a good breakout, the market has yet to make a follow-through rally confirmation.
Still, the market showed some resilience Wednesday, rising despite the midmorning news that new home sales fell for a third straight month in January, off 11%, to a record low.
Bernanke told a congressional panel that the Federal Reserve planned to keep interest rates low for "an extended period."
The dollar also had an impact. It pulled back after a bounce on Tuesday. That helped boost oil $1, to just below $80 a barrel. Gold rose less than 1% to near its recent resistance around $1,100 an ounce.
Earnings news stirred much of the day's other action.
U.S. Stocks Bounce Back, But Volume Lags
5:15 p.m. Update: Stocks rose for the first time in three sessions Wednesday, as Federal Reserve Chairman Ben Bernanke pledged to keep interest rates low for an "extended period" of time.
The Nasdaq climbed 1%, closing back above its 50-day moving average by a narrow margin. The S&P 500 also gained 1%, but finished slightly below its 50-day line. Meanwhile, the Dow and NYSE composite rose 0.9% and 0.8%, respectively.
Volume fell on both exchanges, mitigating the comeback.
Monday, February 22, 2010
Trade Turns Quiet As Indexes Take Small Step Back
Stocks edged down as the recent trend of quiet volume continued Monday.
The Nasdaq, S&P 500 and NYSE composite each slipped 0.1%. The Dow stepped back 0.2%.
Volume was down 16% on the NYSE and 12% on the Nasdaq. For the Nasdaq, it was the slowest trade so far in 2010.
Still, the Nasdaq and the Dow held above their 50-day moving averages, a line they recently reclaimed. The S&P 500 closed under the 50-day line. The NYSE composite hasn't closed above the 50-day in more than four weeks.
One discouraging technical factor is the indexes' Accumulation/Distribution Ratings. While the indexes have risen since Feb. 5, their Acc/Dist Ratings remain at the lowest-possible E.
But among top-rated stocks Monday, action had a positive bias.
In the past couple of weeks, a handful of stocks have broken out. But in most cases, the action is not creating much regret among investors who remain on the sidelines.
With the market in correction, all purchases are risky.
Many of the breakouts have shown contradictory action.
In economic news Monday, the Obama administration unveiled a plan to prop up Medicare by raising taxes on individuals making above $200,000 a year and families making more than $250,000. The new taxes would target interest, dividends, annuities, royalties, rents and capital gains.
The market, however, didn't react much to the news.
Meanwhile, credit card charge-offs jumped in January, but early-stage delinquencies fell for the third month in a row.
5:15 p.m. Update: Some high-rated stocks made sharp moves in after-hours trading following earnings reports late Monday.
Before the open Tuesday, investors can expect the S&P/Case-Shiller home price data to be released.
4:15 p.m. Update: A rally that started around noon EST hit a ceiling in the final hour, sending the market to a narrow loss Monday.
The Dow fell 0.2% as the Nasdaq, NYSE composite and S&P 500 dropped 0.1% each. Volume was lower across the board, according to preliminary figures.
The best industry groups on the day were laggards. That's not ideal. The top group was transportation services. It gained 2.5% and ranked 174th
The Nasdaq, S&P 500 and NYSE composite each slipped 0.1%. The Dow stepped back 0.2%.
Volume was down 16% on the NYSE and 12% on the Nasdaq. For the Nasdaq, it was the slowest trade so far in 2010.
Still, the Nasdaq and the Dow held above their 50-day moving averages, a line they recently reclaimed. The S&P 500 closed under the 50-day line. The NYSE composite hasn't closed above the 50-day in more than four weeks.
One discouraging technical factor is the indexes' Accumulation/Distribution Ratings. While the indexes have risen since Feb. 5, their Acc/Dist Ratings remain at the lowest-possible E.
But among top-rated stocks Monday, action had a positive bias.
In the past couple of weeks, a handful of stocks have broken out. But in most cases, the action is not creating much regret among investors who remain on the sidelines.
With the market in correction, all purchases are risky.
Many of the breakouts have shown contradictory action.
In economic news Monday, the Obama administration unveiled a plan to prop up Medicare by raising taxes on individuals making above $200,000 a year and families making more than $250,000. The new taxes would target interest, dividends, annuities, royalties, rents and capital gains.
The market, however, didn't react much to the news.
Meanwhile, credit card charge-offs jumped in January, but early-stage delinquencies fell for the third month in a row.
5:15 p.m. Update: Some high-rated stocks made sharp moves in after-hours trading following earnings reports late Monday.
Before the open Tuesday, investors can expect the S&P/Case-Shiller home price data to be released.
4:15 p.m. Update: A rally that started around noon EST hit a ceiling in the final hour, sending the market to a narrow loss Monday.
The Dow fell 0.2% as the Nasdaq, NYSE composite and S&P 500 dropped 0.1% each. Volume was lower across the board, according to preliminary figures.
The best industry groups on the day were laggards. That's not ideal. The top group was transportation services. It gained 2.5% and ranked 174th
Friday, February 19, 2010
Stocks Near Neutral In Reaction To Fed
Stocks settled slightly higher Friday in the first session following the Federal Reserve's surprise discount-rate hike.
The S&P 500 added 0.2%. The Nasdaq and the Dow edged up 0.1% each. The NYSE composite was up fractionally.
Volume rose across the board. Friday was an expiration day for February options, which often gives a boost to volume.
The Street initially showed some nervousness about the Fed's action. Stocks opened moderately lower.
After the early hesitation, cautious acceptance prevailed.
The major indexes found traction about a half hour into the session and climbed steadily. The indexes gave up much of their gains in an afternoon decline.
Analysts said the discount-rate change was largely symbolic. It involves the rate the Federal Reserve charges banks for overnight loans from the Fed. In contrast, the federal funds rate, which remains unchanged, has a larger ripple effect. It involves the rate banks charge each other for short-term loans.
In the wake of the 2000-03 bear market, the Fed didn't raise the federal funds rate for more than a year. The first federal funds hike came 15 months after the market made a follow-through day in March 2003 that started the next bull market.
How did the market react to the rate increases when they began in mid-2004? The Nasdaq fell for six weeks and then began a 20-week advance.
Despite higher volume in the major indexes, top-rated stocks were mostly quiet Friday. Only a few made big moves in fast trade, despite the increase in market volume.
The S&P 500 gained 3.1% for the week; the Dow and NYSE composite 3% each; and the Nasdaq 2.8%. It was one of the market's best weeks of the year.
In economic news, the consumer price index showed less inflation than analysts expected.
5:15 p.m. Update: After-hours action was calm Friday with no notable economic news or companies reporting.
Monday, however, will be busy. Over 100 companies are scheduled to release earnings, and few have specified when.
No U.S. economic news is scheduled before the market opens. The first two items on the day's docket are comments from Janet Yellen, San Francisco Fed President, at 10:30 a.m. EST, followed by Fed Chief Ben Bernanke at 11 a.m. EST.
The S&P 500 added 0.2%. The Nasdaq and the Dow edged up 0.1% each. The NYSE composite was up fractionally.
Volume rose across the board. Friday was an expiration day for February options, which often gives a boost to volume.
The Street initially showed some nervousness about the Fed's action. Stocks opened moderately lower.
After the early hesitation, cautious acceptance prevailed.
The major indexes found traction about a half hour into the session and climbed steadily. The indexes gave up much of their gains in an afternoon decline.
Analysts said the discount-rate change was largely symbolic. It involves the rate the Federal Reserve charges banks for overnight loans from the Fed. In contrast, the federal funds rate, which remains unchanged, has a larger ripple effect. It involves the rate banks charge each other for short-term loans.
In the wake of the 2000-03 bear market, the Fed didn't raise the federal funds rate for more than a year. The first federal funds hike came 15 months after the market made a follow-through day in March 2003 that started the next bull market.
How did the market react to the rate increases when they began in mid-2004? The Nasdaq fell for six weeks and then began a 20-week advance.
Despite higher volume in the major indexes, top-rated stocks were mostly quiet Friday. Only a few made big moves in fast trade, despite the increase in market volume.
The S&P 500 gained 3.1% for the week; the Dow and NYSE composite 3% each; and the Nasdaq 2.8%. It was one of the market's best weeks of the year.
In economic news, the consumer price index showed less inflation than analysts expected.
5:15 p.m. Update: After-hours action was calm Friday with no notable economic news or companies reporting.
Monday, however, will be busy. Over 100 companies are scheduled to release earnings, and few have specified when.
No U.S. economic news is scheduled before the market opens. The first two items on the day's docket are comments from Janet Yellen, San Francisco Fed President, at 10:30 a.m. EST, followed by Fed Chief Ben Bernanke at 11 a.m. EST.
Wednesday, February 10, 2010
Happy Chinese New Year & Have a Nice Holiday to all!!
won't be posting for a week, it is good to take a break & enjoy, do have fun!
Stocks Post Modest Losses As Volume Drifts Lower
Stocks jogged to a negative finish Wednesday, although in softer volume.
The NYSE composite, S&P 500 and the Dow each lost 0.2%. The Nasdaq edged down 0.1%. Volume was down on both major indexes. An East Coast blizzard contributed to the slower trading.
Few leaders showed any gumption Wednesday. Breakouts have been nonexistent to rare recently.
With the market in correction, investors are best off staying on the sidelines and building watch lists. Focus on stocks with strong fundamentals. Some of these stocks, such as Priceline (PCLN), appear to be forming bases.
Strong stocks often use a market correction to form positive patterns. The market, though, still reflects institutional selling. For example, the Nasdaq's Accumulation/Distribution Rating has been stuck at a lowest-possible E for 10 consecutive sessions. The NYSE composite has been at E for 15 sessions in a row.
While it's unusual for an index to be stuck at E for a long time, it's not unprecedented. For example, on May 25, 2004, the Nasdaq followed through after 11 consecutive sessions with such a poor Acc/Dis Rating.
An E rating isn't necessarily bad for a market follow-through.
Follow-through days that occur with the index at E usually work, recent history suggests. There were six follow-through days since 2000 that came with the index showing E ratings. Only one failed.
What you don't want to do is jump the gun. The indexes have corrected 8% to 11% in this decline. But there's no assurance that lows have been made. Wait for a follow-through day to signal an uptrend is under way.
A follow-through day involves a significant gain in a major index in higher volume than the prior session. It must occur on Day 4 or later of a rally attempt.
5:15 p.m. Update: Stocks slipped after a back-and-forth session Wednesday, as investors mulled a report suggesting help for Greece, a growing trade deficit and Fed Chairman Ben Bernanke's outline for the stimulus exit.
The Dow, NYSE composite and S&P 500 lost 0.2% each. Intraday, the NYSE composite was down as much as 1.2% and up as much as 0.2%. Meanwhile, the Nasdaq fell 0.1%. A heavy snow storm back East dampened trading volume on both exchanges.
Stocks Post Modest Losses As Volume Drifts Lower
Stocks jogged to a negative finish Wednesday, although in softer volume.
The NYSE composite, S&P 500 and the Dow each lost 0.2%. The Nasdaq edged down 0.1%. Volume was down on both major indexes. An East Coast blizzard contributed to the slower trading.
Few leaders showed any gumption Wednesday. Breakouts have been nonexistent to rare recently.
With the market in correction, investors are best off staying on the sidelines and building watch lists. Focus on stocks with strong fundamentals. Some of these stocks, such as Priceline (PCLN), appear to be forming bases.
Strong stocks often use a market correction to form positive patterns. The market, though, still reflects institutional selling. For example, the Nasdaq's Accumulation/Distribution Rating has been stuck at a lowest-possible E for 10 consecutive sessions. The NYSE composite has been at E for 15 sessions in a row.
While it's unusual for an index to be stuck at E for a long time, it's not unprecedented. For example, on May 25, 2004, the Nasdaq followed through after 11 consecutive sessions with such a poor Acc/Dis Rating.
An E rating isn't necessarily bad for a market follow-through.
Follow-through days that occur with the index at E usually work, recent history suggests. There were six follow-through days since 2000 that came with the index showing E ratings. Only one failed.
What you don't want to do is jump the gun. The indexes have corrected 8% to 11% in this decline. But there's no assurance that lows have been made. Wait for a follow-through day to signal an uptrend is under way.
A follow-through day involves a significant gain in a major index in higher volume than the prior session. It must occur on Day 4 or later of a rally attempt.
5:15 p.m. Update: Stocks slipped after a back-and-forth session Wednesday, as investors mulled a report suggesting help for Greece, a growing trade deficit and Fed Chairman Ben Bernanke's outline for the stimulus exit.
The Dow, NYSE composite and S&P 500 lost 0.2% each. Intraday, the NYSE composite was down as much as 1.2% and up as much as 0.2%. Meanwhile, the Nasdaq fell 0.1%. A heavy snow storm back East dampened trading volume on both exchanges.
Tuesday, February 9, 2010
Greece Hopes Lift Stocks; Volume Rises
Another day of currency-related trading handed the stock market solid gains Tuesday.
The NYSE composite surged 1.8%, the Dow 1.5%, the S&P 500 1.3% and the Nasdaq 1.2%. Volume rose 8% on the Nasdaq and 14% on the NYSE above Monday's action.
The session pivoted on reports of a possible loan guarantee from European governments to help Greece get past its debt crisis. Fears that Greece's debt woes could spin out into larger financial problems have damaged the euro in recent weeks and hurt global stocks.
Tuesday's hopes lifted the euro and world exchanges.
Around 12:45 EST, indexes slid on reports quoting a German official who called news of a bailout unfounded. Still, U.S. indexes managed to hold the majority of their gains.
With the dollar dropping against a rebounding euro, stocks of U.S. exporters rose. Commodities climbed also. Steel, farming, mining and other related industries led the market.
Tuesday's action added another bullish plank to the market's bottoming effort.
After a positive reversal Friday, indexes fell in lower volume Monday. Tuesday's gain in higher trade continued the favorable price and volume action.
5:15 p.m. Update: Stocks recouped Monday's losses and then some Tuesday as bailout hopes for Greece lifted sentiment.
The NYSE composite ran up 1.8%, but down from 2.6% at session peak. The Dow rallied 1.5%, closing back above the psychological 10,000 level. Meanwhile, the S&P 500 and the Nasdaq gained 1.3% and 1.2%, respectively.
Volume jumped on both exchanges.
The dollar pulled back against the euro. Gold and oil also rallied.
The NYSE composite surged 1.8%, the Dow 1.5%, the S&P 500 1.3% and the Nasdaq 1.2%. Volume rose 8% on the Nasdaq and 14% on the NYSE above Monday's action.
The session pivoted on reports of a possible loan guarantee from European governments to help Greece get past its debt crisis. Fears that Greece's debt woes could spin out into larger financial problems have damaged the euro in recent weeks and hurt global stocks.
Tuesday's hopes lifted the euro and world exchanges.
Around 12:45 EST, indexes slid on reports quoting a German official who called news of a bailout unfounded. Still, U.S. indexes managed to hold the majority of their gains.
With the dollar dropping against a rebounding euro, stocks of U.S. exporters rose. Commodities climbed also. Steel, farming, mining and other related industries led the market.
Tuesday's action added another bullish plank to the market's bottoming effort.
After a positive reversal Friday, indexes fell in lower volume Monday. Tuesday's gain in higher trade continued the favorable price and volume action.
5:15 p.m. Update: Stocks recouped Monday's losses and then some Tuesday as bailout hopes for Greece lifted sentiment.
The NYSE composite ran up 1.8%, but down from 2.6% at session peak. The Dow rallied 1.5%, closing back above the psychological 10,000 level. Meanwhile, the S&P 500 and the Nasdaq gained 1.3% and 1.2%, respectively.
Volume jumped on both exchanges.
The dollar pulled back against the euro. Gold and oil also rallied.
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