David Moenning's Daily State of the Markets 09/28
Tweet
Share
E-mail
Close, But No Cigar
Good morning. While the headlines will focus on a third straight day of gains and another set of fresh new highs for the year in the Dow and S&P, the day has to be considered a disappointment among the party planner crowd. In short, the media was all set for a party yesterday. TV commentators put on their best duds and had party hats and noisemakers at their sides all day long in anticipation of the DJIA hitting a new all-time high.
CNBC went so far as to create a new special ticker, which ran the entire day and displayed how far we were from the old highs every few seconds. They also ran �special alerts� almost the entire session, reminding everyone that the Dow was nearing an all-time high close. But unfortunately, after a brief flirtation with the Promised Land in the early going, which fell 3 points shy, traders got spooked and the champagne was left unopened.
With just about everybody focused on the quest for a new high, it was actually a little surprising that the bulls couldn�t muster the strength to move the venerable index up another couple of points. Well, it was surprising until you looked beyond the NYSE floor, that is. While the economic reports on the day were largely overlooked in favor of the new-high hoopla, the spike in crude prices was tough to ignore and was clearly the villain in yesterday�s plot.
With OPEC now talking about actually cutting production in order to �stabilize� the price of oil, which, by the way, has dropped about 20% in the last month and a half, the oil bulls seemed to find their lost mojo and pushed prices higher. While the timing of the move wasn�t exactly intuitive, the gang at the NYMEX managed to move the crude contract up by almost $2 to close at $62.96.
And in light of the fact that much of the recent rally has been tied to the consumer �feeling better� about things, it is hard to argue for another blast higher when the bullish prop appears to be waning.
But, we shouldn�t count out our barnyard buddies just yet as it probably won�t take much to get the party restarted (34 points to be exact). So, we should keep our eyes peeled for just about any kind of catalyst or excuse to party like its 1999. (Actually, the high was set on January 14, 2000, but who�s really counting?)
Turning to this morning, the focus remains on the 11,722.98 level on the DJIA as the bulls appear ready to take another run at infamy this morning. The morning�s economic data came in a bit weaker than expected, but so far at least, hasn�t caused much of a stir.
The Final Revision to the 2nd Quarter�s GDP growth was reported at +2.6%, which was lower than the expectations for a reading of 2.9%. However, everyone knows that the economy has weakened a bit and that inflation is the focal point at the moment. Thus, with the all-important Prices Index coming in on target at 3.3, there isn�t much reaction in either the stock or the bond futures.
Running through the pre-game indicators, overseas markets are fractionally higher across the board. Gold futures are moving up again this morning and are quoted at $606.70 right now. Crude oil futures are continuing to rebound and are currently up $0.23 at $63.19. Interest rates are moving up a bit this morning with the 2-year currently quoted at 4.67% while the 10-yr is trading with a yield of 4.62% right now. And finally, with about an hour before the bell, stock futures in the U.S. are slightly ahead of fair value. The Dow futures are currently ahead by 5, the S&Ps are about a point above their fair level, and the NASDAQ is sitting about 3 points above at the moment.
Stocks �In Play� This Morning:
Intel (INTC) � Needham recommends taking profits at this time
STMicroelectronics (STM) � Bloomberg report targets company as buyout candidate
Texas Instruments (TXN) � Mentioned positively in Barron�s
Smith Intl (SII) � To replace GDW in S&P 500 after the close on 9/29
Advanced Micro Devices (AMD) � Downgraded at Think Equity
Nvidia (NVDA) � Downgraded at ThinkEquity
McDonalds (MCD) � Earnings estimates and price target raised at AG Edwards
Saks Inc (SKS) � Upgraded at BofA
NEC Corp (NIPNY) � Downgraded at Bear Stearns
Autonation (AN) � Upgraded at Bear Stearns
Jabil Circuits (JBL) � Downgraded at Goldman Sachs
Time Warner (TWX) � Downgraded at JP Morgan
Novell (NOVL) � JPM initiates coverage with Overweight rating
Petsmart (PETM) � Downgraded at Piper Jaffray
Alcatel (ALA) � Prudential initiates coverage with Overweight
Verizon (VZ) � Earnings estimates and price target raised at UBS, also price target raised at BofA
Prologis (PLD) � UBS initiates coverage with Buy rating
Gilead Sciences (GILD) � Credit Suisse initiates coverage with Outperform rating
Long positions in stocks mentioned: PLD
** For More of David Moenning�s Market Analysis, Stock Portfolios, and Trading Ideas, visit: www.TopGunsTrading.com
The opinions and forecasts expressed are those of David Moenning, President of Heritage Capital Management and Co-Founder of TopGunsTrading.com and may not actually come to pass. Mr. Moenning�s opinions and viewpoints regarding the future of the markets should not be construed as recommendations of any specific security or Heritage Capital program. No part of this material is intended as an investment recommendation. Neither the information nor any opinion expressed constitutes a solicitation to purchase or sell securities or any of HCM�s programs. Do NOT ever purchase any security without doing sufficient research. There is no guarantee that investment objectives outlined will actually come to pass. Investors should consult an Investment Professional before investing in any investment program. Neither Mr. Moenning or Heritage Capital Management nor any of their employees shall have any liability for any loss sustained by anyone who has relied on the information contained herein. Mr. Moenning and employees of HCM may at times have positions in the securities referred to and may make purchases or sales of these securities while this publication is in circulation. The analysis contained is based on both technical and fundamental research. Although the information contained is derived from sources which are believed to be reliable, they cannot be guaranteed.
www.TopGunsTrading.com
Good morning. While the headlines will focus on a third straight day of gains and another set of fresh new highs for the year in the Dow and S&P, the day has to be considered a disappointment among the party planner crowd. In short, the media was all set for a party yesterday. TV commentators put on their best duds and had party hats and noisemakers at their sides all day long in anticipation of the DJIA hitting a new all-time high.
CNBC went so far as to create a new special ticker, which ran the entire day and displayed how far we were from the old highs every few seconds. They also ran �special alerts� almost the entire session, reminding everyone that the Dow was nearing an all-time high close. But unfortunately, after a brief flirtation with the Promised Land in the early going, which fell 3 points shy, traders got spooked and the champagne was left unopened.
With just about everybody focused on the quest for a new high, it was actually a little surprising that the bulls couldn�t muster the strength to move the venerable index up another couple of points. Well, it was surprising until you looked beyond the NYSE floor, that is. While the economic reports on the day were largely overlooked in favor of the new-high hoopla, the spike in crude prices was tough to ignore and was clearly the villain in yesterday�s plot.
With OPEC now talking about actually cutting production in order to �stabilize� the price of oil, which, by the way, has dropped about 20% in the last month and a half, the oil bulls seemed to find their lost mojo and pushed prices higher. While the timing of the move wasn�t exactly intuitive, the gang at the NYMEX managed to move the crude contract up by almost $2 to close at $62.96.
And in light of the fact that much of the recent rally has been tied to the consumer �feeling better� about things, it is hard to argue for another blast higher when the bullish prop appears to be waning.
But, we shouldn�t count out our barnyard buddies just yet as it probably won�t take much to get the party restarted (34 points to be exact). So, we should keep our eyes peeled for just about any kind of catalyst or excuse to party like its 1999. (Actually, the high was set on January 14, 2000, but who�s really counting?)
Turning to this morning, the focus remains on the 11,722.98 level on the DJIA as the bulls appear ready to take another run at infamy this morning. The morning�s economic data came in a bit weaker than expected, but so far at least, hasn�t caused much of a stir.
The Final Revision to the 2nd Quarter�s GDP growth was reported at +2.6%, which was lower than the expectations for a reading of 2.9%. However, everyone knows that the economy has weakened a bit and that inflation is the focal point at the moment. Thus, with the all-important Prices Index coming in on target at 3.3, there isn�t much reaction in either the stock or the bond futures.
Running through the pre-game indicators, overseas markets are fractionally higher across the board. Gold futures are moving up again this morning and are quoted at $606.70 right now. Crude oil futures are continuing to rebound and are currently up $0.23 at $63.19. Interest rates are moving up a bit this morning with the 2-year currently quoted at 4.67% while the 10-yr is trading with a yield of 4.62% right now. And finally, with about an hour before the bell, stock futures in the U.S. are slightly ahead of fair value. The Dow futures are currently ahead by 5, the S&Ps are about a point above their fair level, and the NASDAQ is sitting about 3 points above at the moment.
Stocks �In Play� This Morning:
Intel (INTC) � Needham recommends taking profits at this time
STMicroelectronics (STM) � Bloomberg report targets company as buyout candidate
Texas Instruments (TXN) � Mentioned positively in Barron�s
Smith Intl (SII) � To replace GDW in S&P 500 after the close on 9/29
Advanced Micro Devices (AMD) � Downgraded at Think Equity
Nvidia (NVDA) � Downgraded at ThinkEquity
McDonalds (MCD) � Earnings estimates and price target raised at AG Edwards
Saks Inc (SKS) � Upgraded at BofA
NEC Corp (NIPNY) � Downgraded at Bear Stearns
Autonation (AN) � Upgraded at Bear Stearns
Jabil Circuits (JBL) � Downgraded at Goldman Sachs
Time Warner (TWX) � Downgraded at JP Morgan
Novell (NOVL) � JPM initiates coverage with Overweight rating
Petsmart (PETM) � Downgraded at Piper Jaffray
Alcatel (ALA) � Prudential initiates coverage with Overweight
Verizon (VZ) � Earnings estimates and price target raised at UBS, also price target raised at BofA
Prologis (PLD) � UBS initiates coverage with Buy rating
Gilead Sciences (GILD) � Credit Suisse initiates coverage with Outperform rating
Long positions in stocks mentioned: PLD
** For More of David Moenning�s Market Analysis, Stock Portfolios, and Trading Ideas, visit: www.TopGunsTrading.com
The opinions and forecasts expressed are those of David Moenning, President of Heritage Capital Management and Co-Founder of TopGunsTrading.com and may not actually come to pass. Mr. Moenning�s opinions and viewpoints regarding the future of the markets should not be construed as recommendations of any specific security or Heritage Capital program. No part of this material is intended as an investment recommendation. Neither the information nor any opinion expressed constitutes a solicitation to purchase or sell securities or any of HCM�s programs. Do NOT ever purchase any security without doing sufficient research. There is no guarantee that investment objectives outlined will actually come to pass. Investors should consult an Investment Professional before investing in any investment program. Neither Mr. Moenning or Heritage Capital Management nor any of their employees shall have any liability for any loss sustained by anyone who has relied on the information contained herein. Mr. Moenning and employees of HCM may at times have positions in the securities referred to and may make purchases or sales of these securities while this publication is in circulation. The analysis contained is based on both technical and fundamental research. Although the information contained is derived from sources which are believed to be reliable, they cannot be guaranteed.
www.TopGunsTrading.com
You May Also Be Interested In
- Midday movers: Morgan Stanley, UnitedHealth rise; Tesla falls
- Midday movers: Delta, Taiwan Semiconductor rise; Hexcel falls
- Nike, Alpine Immune Sciences rise premarket; CarMax, Robinhood and Regeneron fall
Create E-mail Alert Related Categories
Contributors, Special ReportsSign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
