Friday, September 10, 2010

Market comments for Sept. 10th and comments about both 9/11 anniversary and Emergency Preparedness.

A friend of mine this morning provides me with an excerpt from the WSJ showing something relevant about the Initial Jobless Claims numbers released yesterday. Here's his note to me:

9.9.10/WSJ's MarketWatch: "Weekly jobless claims decline by 27,000 to 451,000; Labor Day holiday may have distorted data"


Excerpt: One potentially big caveat about the latest data is distortion caused by the Labor Day holiday. Two large states, California and Virginia, supplied estimates instead of actual data, while the federal government estimated the claims of seven other states.
"Given the weakness in the labor market, we welcome any sign of improvement in the pace of layoffs, but this figure should be taken with a grain of salt," economist Omair Sharif wrote in a report.
A more accurate gauge of employment trends is the four-week average of initial claims, which is less volatile than the weekly number. The four-week average fell a more modest 9,250 to 477,750.
"This is a level consistent with a stagnant labor market and very subdued private sector job creation," economist Neil Dutta of Bank of America/Merrill Lynch said in an email.

Thanks Dennis!

And I thought another piece of information was relevant to what I am experiencing about the stock market. This is an article from Seeking Alpha titled, "What MasterCard and Visa Show About Market Disconnects" by Karl Denninger. Here's one excerpt from his article:

Simply put, either the market is "wrong" (and both of these stocks are screaming buys) or the market is right and the economy is literally falling apart.

If the latter, then all this "levitation" and "great time to buy" nonsense in the broader market is about to undergo a "reality adjustment" that just might reach 40% down - from here.

Pick a view, then place your bets.

The only economic data to be released today at 7:00am PST is the Wholesale Inventories number. This is a release of July data, hence backward looking. Expectations are for the number to come in at +0.4%, nut I don't see much of a reaction from this data. The big news will be more on what the Pastor from Florida plans to do tomorrow, go to visit NY and speak to the Imam, or stay home out of anger and do something stupid out of anger on the anniversary of 9/11. European markets are down currently while Dow Futures are up modestly +25 points.

The charts below show the Dow and S&P 500 for a 2 month period. You will notice that there is a light yellow line on both and they are the 200 day Moving Average. Both Indexes have remained below this line the past 2 months, with only brief moves above it. However, the S&P has gained closer than it was to the 200 day MA when I posted the same charts a few weeks ago. I do not believe we will go above this Resistance level and stay there so we are now at the top of the range. It is a good time to buy Short indexes again if you don't own some. I use ETF's as you know and while I haven't sold any, there has been a number of opportunities these past few months to make some nice gains on short term picks. Have a nice weekend.

On a side note, there was a massive gas explosion in the South San Francisco community of San Bruno last night about 6:00pm. I'm sure you have seen it on the news. Many victims are severely burned and many homes were destroyed. This should be a reminder to prepare yourself and your family for an emergency. In California, we have programs called Get Ready which are 2 hours in duration but will provide you with an awareness of what to do in an Emergency. More advanced programs such as CERT (Community Emergency Response Training) gives people all the knowledge they will need to survive 7 days without help from local Fire and Police Dept. assistance in your community. Give your family a gift and look into your own local program before you face what the people in San Bruno, CA or other people in Tornado affected communities in the midwest face every year, or what the people in Colorado are facing with the fires there. Check with your local Fire Dept. for programs near you.

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Blogger Vic Cebollero said...


2:57 PM  

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