The Week In Review
8/27-8/31/12August 31, 2012
U.S. stocks opened sharply higher Friday as investors looked to a speech by Federal Reserve Chairman Ben Bernanke and more definitive action from the European Central Bank next week. "We'll see how many investors still expect something from the Fed. Clearly things are not good here, but they're not bad. In Europe, things are worse. There is a more realistic hope the ECB will intervene," said Bruce McCain, chief investment strategist at Key Private Bank. The Dow Jones Industrial Average rose 101 points to 13,101. The S&P 500 index added 8 points to 1,408. The Nasdaq Composite gained 22 points to 3,070. Very little news ahead of the Fed speech, but it looks like investors are anticipating something good. The big cap techs look good although Apple is quiet. Corning is higher by 3% on an upgrade while Facebook is down 3% on a downgrade. The financials overseas are performing well caring over to our markets. Credit Suisse is higher by 4% on an upgrade. Toronto Dominion is higher even though it was downgraded. The energy, materials, and industrials look good while the utilities and telecom are flat. It's a risk on day. Through the first half an hour a weaker PMI followed by a stronger consumer confidence number did little to budge the markets. The Fed Chairman's speech was released at 10 o'clock with no indication of any QE3 stimulus. The averages initially gave up most of its gains only to slowly regain most of the rally. Heading into the lunch hour, the averages pulled back once again as the Euro sold off causing the Dollar to rebound, but the currencies reversed course in the afternoon allowing the Dow to rally triple digits once again. Only a few stocks are in the red. Facebook is lower by 5% to new lows. A recent star, Phillips 66 is lower by 2.3%, but that's about it for the blue chips. Only two Dow components are in the red and only by a couple cents each. In the last hour the averages were able to hold on to gains to finish out the week. The Dow Jones Industrial Average rose 90 points to 13,090, giving it a 0.6% August gain and a 0.5% decline on the week. The S&P 500 index climbed 7 points to 1,406, rising 2% for the month and down 0.3% for the week. The Nasdaq Composite advanced 18 points, or 0.6%, to 3,066, up 4.3% for the month and off 0.1% for the week. Three great months in a row to finish up a great summer.
August 30, 2012
U.S. stocks tallied steep declines Thursday after a report had economic confidence in the euro area sliding to a three-year low and Japan's retail sales fell in July. Strategist also said investors could be setting themselves up for a fall ahead of Federal Reserve Chairman Ben Bernanke's speech Friday in Jackson Hole, Wyo. "There are a lot of expectations built into his talk," said Jack Ablin, chief investment of U.S. stocks tallied steep declines Thursday after a report had economic confidence in the euro area sliding to a three-year low and Japan's retail sales fell in July. Strategist also said investors could be setting themselves up for a fall ahead of Federal Reserve Chairman Ben Bernanke's speech Friday in Jackson Hole, Wyo. "There are a lot of expectations built into his talk," said Jack Ablin, chief investment officer at Harris Private Bank in Chicago. The Dow Jones Industrial Average fell 67 points to 13,039. The S&P 500 index lost 7 points to 1,403. The Nasdaq Composite index dropped 17 points to 3,068. A quiet morning once again ahead of the Fed Chairman's speech tomorrow. The retail sector is making news this morning with same store monthly sales. Gap is gaping up 2.5% thanks to strong sales. Kohls and Pier One are also higher by 2% on strong sales. Zales is jumping 6% on earnings and an upgrade. Amazon is higher on news they are sold out of their Kindle Fire. The consumer discretionary sector in general is lower along with the broader market. In the tech sector, Pandora is higher by 17% thanks to better than expected earnings. VMware is lower on an upgrade. KLA Tencor is lower by 2% on a downgrade. IBM is modestly higher, but the other blue chips are modestly lower. Through the first hour the averages remained weak making new lows down 100 points in the Dow. The Nasdaq fell 27 points. Part of the selloff is due to a rally in the US dollar and weakness in the Euro. In the healthcare space, Cigna is higher on earnings and an upgrade. UnitedHealth Group is modestly higher on an upgrade. MAKO Surgical is lower by 3% on a downgrade after a surge higher yesterday following earnings. During the lunch hour the Dow fell 125 points before slowly rebounding. The weakest sectors are the techs, materials, and industrials. In the afternoon the averages kept slowly improving. In the last hour the averages pulled back toward the lows of the day ahead of the Fed Chairman's Jackson Hole speech tomorrow. The Dow Jones Industrial Average finished down 106 points at 13,000. The S&P 500 index lost 11 points to 1,399, its first finish under 1,400 in four weeks. The Nasdaq Composite declined 32 points, or 1.1%, at 3,048.
August 29, 2012
U.S. stocks opened higher Wednesday after the government hiked its estimate of how the economy performed and investors looked to Federal Reserve Ben Bernanke's speech. "It is like a car travelling at 17 miles per hour in a 55 mile-per-hour speed zone," Fred Dickson, chief investment strategist at Davidson Companies, wrote of the economy's performance in an email. "The next potential market-moving event occurs Friday," Dickson added of Bernanke's scheduled talk at an annual symposium in Wyoming. The Dow Jones Industrial Average rose 15 points to 13,118. The S&P 500 index gained 2 points to 1,411. The Nasdaq Composite rose 6 points to 3,083. Another quiet morning even as Hurricane Isaac hit New Orleans and Louisiana. The energy sector is lower in general this morning as no major damage to any oil platforms and refiners in the gulf. Noble Corp and Diamond Offshore were upgraded this morning, but both are modestly lower. Steel and coal stocks are coming under pressure once again. Rare earth produce, Molycorp is bucking the trend up for a second straight day following announced production increases the other day. The materials and industrials have also restarted their downward trend once again. Joy Global is down 4% after missing earnings estimates. Caterpillar is lower as well in sympathy along with Freeport McMoran. The best performing sectors are consumer staples and discretionary. Jos. A Bank is a diamond today up 16% after beating earnings estimates. Zale is also higher on earnings. Molson Coors is higher on an upgrade while Best Buy is lower on concerns private equity won't be interested in buying out the firm. In the tech space, Google continues its' upward trend to a new 52 week high after taking a hit on Monday on the Samsung vs Apple court case. Rival Internet provider in China, Baidu.com continues to come under pressure. Yelp is jumping 21% after their lock up expired. Fusion-io was upgraded, but the stock is lower. Through the first hour the averages went nowhere. Low volatility and low volume have ruled the markets the last several weeks. After the first hour the averages drifted into the red. Healthcare is holding up today. Beaten up HMO, WellPoint is bouncing 7% as their president and CEO is stepping down. The rest of the defensive sector is holding up as well this morning. During the lunch hour and into the afternoon the averages perked up, moving into the green. I'll give Joy Global a lot of credit for the turnaround. The stock dropped over 6% this morning following disappointing earnings, but following a midmorning conference call, the stock has rebounded sharply, rising 2.3% for the day and up 9% from the lows on heavy, heavy volume. Joy Global's turnaround has turned around Caterpillar and the industrial sector in general. If not for light volume on Wall Street, this might be a bigger rally. In the last hour the averages gravitated back toward the unchanged level. Even Joy Global pulled back from its' high. The Dow industrials finished up 4 points at 13,107. The Nasdaq Composite rose 4 points to 3,081, its fourth-winning session in a row. The S&P 500 added a point to 1,410.
August 28, 2012
U.S. stocks started Tuesday with modest losses as an upbeat report on the U.S. housing market failed to override concern about Europe's debt troubles. The Dow Jones Industrial Average fell 22 points to 13,101. The S&P 500 index shed 2 points to 1,407. The Nasdaq Composite retreated 5 points to 3,067. A couple retailers are showing some life following better than expected earnings. Movado is jumping 18% thanks to strong watch sales while retailer, PVH is jumping 5% on earnings. Sanderson Farms is higher by 8% even though the company misses estimates. Heinz is higher by 3% after reaffirming numbers. Nike, Ross Stores, and TJX are higher on upgrades. In the tech space, Apple is lower after reaching an all-time high yesterday. Google is bouncing back after getting hit yesterday. KLA Tencor is lower on a downgrade. Lexmark is jumping 14% for the wrong reasons. The company is exiting the inkjet market and cutting 1700 jobs. The energy sector is perking up in some part to Hurricane Isaac. Hess and Chesapeake are higher on rumors of a takeover. Magellan Petroleum is jumping 30% on a takeover offer. Rare earth producer, Molycorp is higher by 12% on increased production. The financials are quiet for a second straight day, but Bank of Montreal is higher by 2% after beating estimates. Through the first hour the averages moved back to the unchanged level. Through the morning the averages went nowhere. The healthcare space continues to slowly improve. Gilead Science is higher on an upgrade. Bristol Myers is slowing improving after getting hit last month. In the afternoon the averages moved absolutely sideways. Quiet, quiet, day. The Dow Jones Industrial Average fell 21 points to 13,102, led by Hewlett-Packard and Bank of America. The S&P 500 fell a point to 1,409. The Nasdaq Composite edged up 3 points to 3,077.
August 27, 2012
U.S. stocks mostly climbed Monday as Apple gained in the wake of a $1 billion jury ruling in its favor. The Dow Jones Industrial Average fell 13 points to 13,144. The S&P 500 index gained nearly a point to 1,412.. The Nasdaq Composite added 7 points to 3,077. The rich get rich as Apple jumps 2% to another new high. Good news for Apple is bad for Samsung, down 7.5% in Seoul. The ruling is also negative for Google and their Android system. Google is down a percent. The news maybe a mild positive for the Windows Phone operating system from Microsoft, partner Nokia and possibly Blackberry maker, Research in Motion. All three are higher. IBM is making news announcing a $1.3 billion software acquisition of Kenexa. The stock is surging 41.6%. Outside the tech space, things are quiet. It's quiet risk off kind of day. The transportation sector continues to struggle not confirming the recent rally. The utilities, consumer staples, and healthcare space are taking the lead today. The financial space is quiet for the most part. Hudson City Bancorp is trading up 15% after agreeing to be acquired by M&T Bank $3.7 billion deal. Not bad. Third acquisition announced this morning comes from Hertz Global Holdings announcing the purchase of Dollar Thrifty Automotive Group. Through the morning the averages remained quiet. The Dow moved back to the unchanged level, but that was it for the rally. The Nasdaq is in the green thanks to Apple's 2% rally. In the afternoon the averages continued to move sideways, sliding a little lower into the close. Energy, materials, and industrials under pressure all day. The Dow industrials finished down 33 points at 13,124. The Nasdaq Composite rose 3 points to 3,073, with shares of Apple up 1.9%. The S&P 500 slipped 70 cents to 1,410.