The Morning Look

Market Update:

Stock futures are lower before Thursday’s open as traders wait for Friday’s  jobs report.

Gary’s Thoughts: Futures down just a bit but Macys yonked…Kohls yonked, LB, JWN, JCP and other big retailers smacked….big retailers continue to lag. We suspect there will be many more store closings in the years ahead. Macys just announced a bunch.

Economic Calendar:

  • Weekly Bill Settlement
  • 52-Week Bill Settlement
  • Chain Store Sales[Bullet
  • Challenger Job-Cut Report 7:30 AM ET
  • ADP Employment Report 8:15 AM ET
  • Jobless Claims 8:30 AM ET
  • Gallup Good Jobs Rate 8:30 AM ET
  • Bloomberg Consumer Comfort Index 9:45 AM ET
  • PMI Services Index 9:45 AM ET
  • ISM Non-Mfg Index 10:00 AM ET
  • EIA Natural Gas Report 10:30 AM ET
  • EIA Petroleum Status Report 11:00 AM ET
  • Fed Balance Sheet 4:30 PM ET
  • Money Supply 4:30 PM ET

Highlights:

  • Pence: Replacing Obamacare Is First Order of Business
    Gary’s Thoughts: Market forces!
  • Macy’s Declines After Reducing Outlook, Moves to Cut 10,100 Jobs
    Gary’s Thoughts: Hate seeing so many cuts.

The Closing Look

Stocks were closed on Monday in observance of the New Year Holiday. On Tuesday, stocks rallied on the first trading day of 2017 but closed off their highs after energy prices plunged. Natural Gas plunged 10% mid day on ample supply and a seasonally warm January and February. Oil prices U.S. opened higher but closed lower and hit a two-week low as the US dollar rallied. Economic data was mostly positive which helped the greenback rally. The ISM manufacturing index jumped to 54.7, a two-year high and easily beating estimates for 53.8. Elsewhere, construction spending jumped to a 10-year high and also beat estimates. The stronger than expected economic data strengthens the case for the Fed to raise rates later this year, hence the stronger dollar.

Gary’s Thoughts: See-saw day. Strong gap open…good sell…75 dow points to the upside in the final 30. WATCH GOLD here. Looks like it wants to turn up for now. Not sure duration but looks like money flows coming in. Stocks leading the metal. Also, oil prices reversed down hard but oil stocks did not. Something else to watch as many oil names sitting tight.

Two interesting political stories of the day. First, the moron Republicans tried squashing some ethics rules. Yup…first day of year and look what some wanted to do. The good news is Trump squashed them and went nowhere. Also. Ford not moving plant to Mexico and will invest in the good old U.S. of A. Ford CEO first says had nothing to do with Trump but then says it does…gonna be a fun 4 years and it hasn’t even started.

The Morning Look

Market Update:

Stock futures are higher before Wednesday’s open as traders wait for a busy day and week of economic data.

Gary’s Thoughts: Futures up a wee bit as beginning of year starts nicely.

Economic Calendar:

  • Motor Vehicle Sales
  • MBA Mortgage Applications 7:00 AM ET
  • ADP Employment Report 8:15 AM ET
  • Gallup U.S. Job Creation Index 8:30 AM ET
  • Redbook 8:55 AM ET
  • Gallup US Consumer Spending Measure 2:00 PM ET
  • FOMC Minutes 2:00 PM ET

Highlights:

  • Ford cancels Mexico plant… Ford CEO tries to say it was because “market demand, not Trump”
    Gary’s Thoughts: By end of day, said it was confidence in Trump policies that also moved the needle. Nothing by accident kids.
  • Energy markets reversed hard on Tuesday which took some ‘energy’ out of the market
    Gary’s Thoughts: But underlying stocks did not reverse with the price of oil.

The Morning Look

Market Update:

Stock futures are higher ahead of Tuesday’s open on the first trading day of 2017.

Gary’s Thoughts: Happy new year to all. Hope you had a great holiday. We are back in the states with serious jet lag but nevertheless, alive and well. We will wait til end of week for bigger report as we want to see how the new year starts out. We walked into new year with some deterioration in markets past couple of weeks but that can be negated quickly if money finds its way into the market to start the year…and that’s exactly what we are getting this morning with a gap to the upside. The worst areas recently have been the big cap growth names like AMZN,GOOGLE,FB,PCLN and others. Will be interesting to see what’s in store. Remember, earnings in three weeks.

The one area that has hardly budged is the financials and to be blunt, unless they start coming in, any damage will be limited.

Economic Calendar:

  • 2-Yr Note Settlement
  • 5-Yr Note Settlement
  • 7-Yr Note Settlement
  • PMI Manufacturing Index 9:45 AM ET
  • ISM Mfg Index 10:00 AM ET
  • Construction Spending 10:00 AM ET
  • Gallup US ECI 2:00 PM ET

Highlights:

  • Trump takes to Twitter to slam Obama for transition ‘roadblocks’
    Gary’s Thoughts: We promise you…unlike other presidents, this one will not go away. We will let you decide what that means.
  • Islamic State Claims New Year’s Massacre at Istanbul Nightclub
    Gary’s Thoughts: We were in Europe New Year’s eve, Security was tight…but the bad guys know the soft targets and exploit them. There is simply no way of stopping these one offs.

The Closing Look

Stocks opened higher on Wednesday but turned lower before the Dow could reach 20,000. Economic data was light. Pending home sales slid -2.5%, missing estimates for a gain of +0.5%. In other news, GNC said it will close all 4,400 US stores today to overhaul its pricing system.  Anthera Pharmaceuticals (ANTH) plunged -65% after the money-losing biotech said its Phase 3 study of its Sulloura drug in cystic fibrosis patients with exocrine pancreatic insufficiency missed its primary endpoint. Today was the first “real” down day since the election rally as the market pulls back to digest its recent move.

Gary’s Thoughts: Well…that was the first day we have seen where best areas look like they are going to come in a bit. Not the end of the world but smiles have to come off the bull’s faces. Notwithstanding we are into end of year and next week will be beginning, little tops may be in place as a few things roll over from the past weeks of tight action.

The Closing Look

Stocks were closed on Monday in observance of the Christmas holiday. The market edged higher on Tuesday on the first day of the final trading day of the year. The Nasdaq composite and Nasdaq 100 hit new 52-week highs but pulled back and closed in the middle of the daily range. The S&P Corelogic Case-Shiller home price index came in at 0.06%, beating the Street’s estimate for 0.05%. Elsewhere, consumer confidence rose to 113.7, beating estimates for 108.5. That was the highest reading since 2001 and bodes well for the market and the economy as we head into 2017. The Dallas manufacturing index came in 13.8, which was higher than the last reading of 8.8.

Gary’s Thoughts: Greetings all from Lucerne, Switzerland where the year winds down this week.

Really no sellers even though market came in a wee bit from highs yesterday. Everyone waiting for 20,000 which is probably around the corner but for all intents, it is there now.

Watching big name AMZN may be trying to turn corner here…but needs to jump above 50 day and hold.

The Morning Look

Market Update:

Stock futures are higher ahead of Wednesday’s open as 2016 winds down.

Gary’s Thoughts: As we write this, market is open for a few minutes…nominally higher. AMZN indeed jumps above 50 day early. Let’s see if it can hold. Big cap growth has been mostly comatose since the election.

Economic Calendar:

  • Redbook 8:55 AM ET
  • Pending Home Sales Index 10:00 AM ET
  • 2-Yr FRN Note Auction 11:30 AM ET
  • 5-Yr Note Auction 1:00 PM ET

Highlights:

  • Trump takes on the UN following Security Council resolution on Israel — ‘so sad!’
    Gary’s Thoughts: There is a certain finger that should be aimed right at the U.N.
  • Democrats Plotting ‘Collision Course’ With Trump’s Tax Plan
    Gary’s Thoughts: Yes…dems love your money. $3.3 trillion was enough taxes we sent them in the past year…they all spent $39 trillion…and they want more. They forgot we give it to them…they do not give our earnings to us.

We Enter Last Week of the Year

Expect volume to continue to be light as we head into the new year. But except for those areas we have been telling you to avoid, all is well.

In fact, major indices are sitting tight after the recent move up.  This tells you that so far, even with the move up, sellers refuse to take the lead. And frankly, all it would take is one good day to again take things topside.

Watch the financials. They continue to lead the way. It was this group that broke out on November 9 on heavy volume…which indicated the confidence in the president-elect. Frankly, we are amazed and stunned at how strong they are. A quick glance at Goldman (GS) shows a rare second flag being put in. A break above $245 and away we go again. The XLF and KRE are also doing the same.

We would continue to avoid a bunch of areas. We have highlighted these areas for you many times…including the bond market, utilities, reits, consumer staples like food,beverage and the like, big growth names like Facebook,Amazon and others as they continue to show no relative strength.  We will need to see a move above the 50 day before looking at. Lastly, a bunch of big retail broke down in the past week and would avoid. Big retail has lagged this move since day one.

We are traveling but will continue to update you this week. We want to wish everyone the happiest and healthiest holiday and new year.

The Closing Look

Stocks were quiet on Thursday as the Dow continued to trade just below 20,000. Economic data was mixed. Initial jobless claims rose to 275,000 last week,  missing estimates for 256,000. Separately, durable goods for November slid by -4.6%, which estimates for -4%. On the positive side, the final read for Q3 GDP was +3.5%, beating the Street’s estimate for +3.2%. Earnings data was light but Micron (MU) gapped up while Red Hat (RHT) gapped down after releasing earnings.  The major indices were very quiet today as they pause to digest the recent and strong post election rally.

Gary’s Thoughts: Just letting you know some deterioration going on.  More over the weekend. Happy holidays.

The Morning Look

Market Update:

Stock futures are slightly flat before Friday’s open on the final full trading week of the year.

Gary’s Thoughts: Volume will taper off today, We are traveling and will have a complete wrap up this weekend.

Economic Calendar:

  • New Home Sales 10:00 AM ET
  • Consumer Sentiment 10:00 AM ET
  • Baker-Hughes Rig Count 1:00 PM ET
  • Bond Market Close: 2:00 PM ET

Highlights:

  • Corporate America needs better accountability, billionaire investor Carl Icahn says
    Gary’s Thoughts: Ya think?
  • Bailout of world’s oldest bank underscores lingering crisis in Europe
    Gary’s Thoughts: Debt…debt…more debt.