David Moenning�s Daily State of the Markets:
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Avenging Santa
Good morning. The bears were shown the door yesterday, just one day after they so rudely ignored holiday tradition. By sending stocks down hard when no one was looking last Friday, many analysts felt that it might be time for the bears to embark on a long awaited pullback. After all, if growth, or more accurately, a lack thereof, was the reason for Santa being snubbed, then maybe there was something to Friday�s surprise decline.
However, while volume was extremely light, it appears that the bulls avenged Santa�s ill treatment yesterday by grabbing back most of the points that were lost on Friday. Maybe it was the beginning of the window dressing period. Maybe it was the big drop in oil and gas prices. Or, maybe it was the light volume. But almost any way you want to look at it, yesterday�s gain seemed to brighten the holiday mood on Wall Street.
Traditionally, this is a very light week for the markets. With decent gains on the books for the year, most traders are either at the beach, on the slopes, or spending time with their families. This, of course, creates a rather illiquid environment, which is easily influenced by whichever way the programs are run or by the typical end-of-year window dressing done by portfolio managers.
Yesterday�s move seemed to be triggered primarily by the energy complex. Crude got a boost in the early going by Iran�s pronouncement that they would continue to move forward with their nuclear ambitions. But then about mid-morning, the Natural Gas contract began a rather precipitous decline, which dragged the oil futures along for the ride. While there was no apparent catalyst for the move, Natural Gas wound up with a loss of almost -8% on the day and the February Oil futures finished with a drop of -$1.31 to $61.10.
This was enough to put the bulls back at the reigns and with no real resistance found, our heroes in horns took it home from there.
Turning to this morning, we don�t have any economic news to review before the bell, but, we will get the report on New Home Sales at 10:00 am. And despite the news of former President Gerald Ford�s death, strong overseas markets as well as ongoing M&A activity appears to have put a spring in the bulls� step in the early going.
Running through the rest of the pre-game indicators, as we mentioned, the overseas markets are up nicely across the board. Gold futures are higher again this morning with the last trade up $2.90 to $629.80. Crude futures doing little this morning with the latest quote showing the February futures contract up $0.01 to $61.11. Interest rates are a smidge better so far as the yield on the 10-year currently stands at 4.60%. And finally, with about an hour before the bell, stock futures in the U.S. are looking to open higher. The Dow futures are currently ahead by 36 points; the S&Ps are about 4 points above breakeven, and the NASDAQ looks to be about 7 points ahead of fair value at the moment.
Stocks �In Play� This Morning:
Google (GOOG) � Mentioned positively in Barron�s
Omnicom (OMC) � Mentioned positively in Barron�s
Clear Channel Comm (CCU) � Mentioned positively in Barron�s
NYMEX Holdings (NMX) � BofA starts at Neutral, Citigroup starts at Hold
Sprint Nextel (S) � Estimates reduced at BofA
Qualcomm (QCOM) � Mentioned positively at BofA
Motorola (MOT) � Mentioned positively at BofA
Nokia (NOK) � Mentioned positively at BofA
ConocoPhillips (COP) � Added to Mispriced Growth Portfolio at Morgan Stanley
JP Morgan (JPM) � Added to Mispriced Growth Portfolio at Morgan Stanley
Intl Business Machines (IBM) � Upgraded at ThinkEquity
Telik (TELK) � Downgraded at UBS
USG Corp (USG) � Estimates raised at Jefferies
Long positions in stocks mentioned: MS, IBM, S, QCOM
** 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.
Good morning. The bears were shown the door yesterday, just one day after they so rudely ignored holiday tradition. By sending stocks down hard when no one was looking last Friday, many analysts felt that it might be time for the bears to embark on a long awaited pullback. After all, if growth, or more accurately, a lack thereof, was the reason for Santa being snubbed, then maybe there was something to Friday�s surprise decline.
However, while volume was extremely light, it appears that the bulls avenged Santa�s ill treatment yesterday by grabbing back most of the points that were lost on Friday. Maybe it was the beginning of the window dressing period. Maybe it was the big drop in oil and gas prices. Or, maybe it was the light volume. But almost any way you want to look at it, yesterday�s gain seemed to brighten the holiday mood on Wall Street.
Traditionally, this is a very light week for the markets. With decent gains on the books for the year, most traders are either at the beach, on the slopes, or spending time with their families. This, of course, creates a rather illiquid environment, which is easily influenced by whichever way the programs are run or by the typical end-of-year window dressing done by portfolio managers.
Yesterday�s move seemed to be triggered primarily by the energy complex. Crude got a boost in the early going by Iran�s pronouncement that they would continue to move forward with their nuclear ambitions. But then about mid-morning, the Natural Gas contract began a rather precipitous decline, which dragged the oil futures along for the ride. While there was no apparent catalyst for the move, Natural Gas wound up with a loss of almost -8% on the day and the February Oil futures finished with a drop of -$1.31 to $61.10.
This was enough to put the bulls back at the reigns and with no real resistance found, our heroes in horns took it home from there.
Turning to this morning, we don�t have any economic news to review before the bell, but, we will get the report on New Home Sales at 10:00 am. And despite the news of former President Gerald Ford�s death, strong overseas markets as well as ongoing M&A activity appears to have put a spring in the bulls� step in the early going.
Running through the rest of the pre-game indicators, as we mentioned, the overseas markets are up nicely across the board. Gold futures are higher again this morning with the last trade up $2.90 to $629.80. Crude futures doing little this morning with the latest quote showing the February futures contract up $0.01 to $61.11. Interest rates are a smidge better so far as the yield on the 10-year currently stands at 4.60%. And finally, with about an hour before the bell, stock futures in the U.S. are looking to open higher. The Dow futures are currently ahead by 36 points; the S&Ps are about 4 points above breakeven, and the NASDAQ looks to be about 7 points ahead of fair value at the moment.
Stocks �In Play� This Morning:
Google (GOOG) � Mentioned positively in Barron�s
Omnicom (OMC) � Mentioned positively in Barron�s
Clear Channel Comm (CCU) � Mentioned positively in Barron�s
NYMEX Holdings (NMX) � BofA starts at Neutral, Citigroup starts at Hold
Sprint Nextel (S) � Estimates reduced at BofA
Qualcomm (QCOM) � Mentioned positively at BofA
Motorola (MOT) � Mentioned positively at BofA
Nokia (NOK) � Mentioned positively at BofA
ConocoPhillips (COP) � Added to Mispriced Growth Portfolio at Morgan Stanley
JP Morgan (JPM) � Added to Mispriced Growth Portfolio at Morgan Stanley
Intl Business Machines (IBM) � Upgraded at ThinkEquity
Telik (TELK) � Downgraded at UBS
USG Corp (USG) � Estimates raised at Jefferies
Long positions in stocks mentioned: MS, IBM, S, QCOM
** 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.
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