Thursday, May 31, 2007
Higher and Higher
Things certainly are picking up (and up, and up). Above average volume across the boards today, with the major indexes posting narrow ranging candles in their upper price ranges. The S&P500 had a momentus closing yesterday at an all-time (closing) high, while today's trading range stayed above the previous closing high pivot point.
So it's agreed; U.S. growth was pathetic for the first quarter, rising at only a 0.6% annualized pace, the slowest growth in 4 years. "Housing continued to collapse, business investment was anemic, and the trade gap widened. Businesses, finding they'd stocked too many goods, pruned their inventories back sharply. Consumers, on the other hand, spent freely."
However...the numbers speak for themselves...for the month of May:
DJIA +4.3%
S&P500 +3.3%
Nasdaq +3.1%
Not too shabby for a month whose mantra is Sell in May and Go Away.
So it's agreed; U.S. growth was pathetic for the first quarter, rising at only a 0.6% annualized pace, the slowest growth in 4 years. "Housing continued to collapse, business investment was anemic, and the trade gap widened. Businesses, finding they'd stocked too many goods, pruned their inventories back sharply. Consumers, on the other hand, spent freely."However...the numbers speak for themselves...for the month of May:
DJIA +4.3%
S&P500 +3.3%
Nasdaq +3.1%
Not too shabby for a month whose mantra is Sell in May and Go Away.
Wednesday, May 30, 2007
Hanging Men
The gallows were full-up today, with the Nasdaq100, Russell2000, DJIA, and the S&P500 all forming hanging man-esque candlesticks, as you can see:
Russell2000
Nasdaq Comp.100
S&P500
DJIA
Russell2000
Nasdaq Comp.100
S&P500
DJIA
Tuesday, May 29, 2007
I like doom and gloom just as much as the next guy. But rather than look at the year-over-year decline in home prices as a harbinger of bubble-bursting inflation and economic decay, couldn't we just as easily see it as a correction that we should have been expecting for the past two (perhaps even 5) years now? It seems like ever since Rich Dad, Poor Dad spent five years on the NY Times best seller list and sold over 11 million copies, everyone and their mother has become an "investor" in real estate, leveraging themselves to the hilt to buy that second, third house to "flip." Granted it worked for a lot of people, even to the extent that the lenders, with the help of extra low interest rates, became more and more lenient in who they were giving mortgages out to; "bad credit? no problem!"
So, now it seems time for prices to come back to the (moving) average and correct its parabolic expansion. But with a mere 1.4% decline who's concerned? We should applaud the Federal Reserve for their masterful response with interest rate controls and sound fiscal tightening to prevent the housing bubble from splattering all over their faces.
Cool runnin' from now on, right? I mean so what if foreign lenders are funding our endless $600 billion annual trade deficits. So what that China has $1.2 trillion in foreign exchange reserves. So what that we consume 4% more than we produce? We can just sell off some of our assets to cover it, right (Dubai Ports, Unocal...Blackstone)?
It will all be OK....just keep buying, keep consuming, and keep taking your SOMA, it will all be OK.
So, now it seems time for prices to come back to the (moving) average and correct its parabolic expansion. But with a mere 1.4% decline who's concerned? We should applaud the Federal Reserve for their masterful response with interest rate controls and sound fiscal tightening to prevent the housing bubble from splattering all over their faces.
Cool runnin' from now on, right? I mean so what if foreign lenders are funding our endless $600 billion annual trade deficits. So what that China has $1.2 trillion in foreign exchange reserves. So what that we consume 4% more than we produce? We can just sell off some of our assets to cover it, right (Dubai Ports, Unocal...Blackstone)?
It will all be OK....just keep buying, keep consuming, and keep taking your SOMA, it will all be OK.
Sunday, May 27, 2007
Let the Bidding Begin
Dubai International Financial Centre (DIFC), the owner of the Dubai stock exchange, is mulling a rival bid to Nasdaq's (NDAQ.O: Quote, Profile) agreed $3.7 billion takeover of Nordic markets owner OMX (OMX.ST: Quote, Profile) the Sunday Times reported.
Nasdaq got a piece of Europe with a $3.6 billion deal to acquire OMX, the Stockholm, Sweden-based home of the Nordic and Baltic exchanges, giving it a significant leg up in cash equities and options trading in Europe.The deal comes three months after London Stock Exchange jilted Nasdaq (nasdaq: NDAQ - news ) in its attempt to acquire a controlling stake of the LSE. Nasdaq continues to own 29% of the London market and may still be positioning itself for a run at the exchange, but because of U.K. rules, it won't be allowed to make another takeover attempt until February.
Saturday, May 26, 2007
Prudential increased their share price forecast for Apple Inc. (AAPL). An increase of 8.7% saying rising sales of Macintosh computers and iPods as well as the introduction of the iPhone will boost earnings. They have also increased profit estimates by $0.04 to $3.67/share for this year and $0.15 for 2008 to $4.25. Share price forecast is up $10 to $125.
Friday, May 25, 2007
WOW
Another cool post found on BoingBoing....Sony demonstrates what is " billed as the world's first flexible, full-color OLED display built on organic thin-film transistor (TFT) technology. The 2.5-inch prototype display supports 16.8 million colors at a 120 x 160 pixel resolution, is 0.3 mm thick and weighs 1.5 grams."
Healthy Holiday Close
Russell2000
Nasdaq Comp.100
S&P500
DJIA
All the indices closed up today on mostly lower volume (particularly the DJIA). The S&p500 was up a mere 0.55% on strong volume. A mostly down week, with lots of M/A news, weeker than expected existing home sales, and an increased likelihood of interest rates remaining where they are. The indices are all above some solid Moving Averages and it seems things were set up for a stress-free 3-day weekend.
Nasdaq Comp.100
S&P500
DJIA
All the indices closed up today on mostly lower volume (particularly the DJIA). The S&p500 was up a mere 0.55% on strong volume. A mostly down week, with lots of M/A news, weeker than expected existing home sales, and an increased likelihood of interest rates remaining where they are. The indices are all above some solid Moving Averages and it seems things were set up for a stress-free 3-day weekend.
the bees are dying! the bees are dying!
So, I'm sure many of you have heard the buzz of Colony Collapse Disorder in domestic honey bees. The ramifications of which I'm sure you've also heard about; no bees = no food. At face value it can seem like an easy thing to dismiss as alarmist, or an overreaction, or "left-wing jibber-jabber." But did you know?...
There was actually a Congressional Hearing on the matter on March 29, 2007 to discuss the magnitude and potential impacts of this problem. "Between 1947 and 2005, colony numbers nationwide declined by over 40%. These losses have occurred as a demand for pollination services has soared for a number of fruit, nut, and vegetable crops, most notably almonds." The honey bee has been partially domesticated for thousands of years to serve purposes for man. "Honey bees are in effect six-legged livestock that both manufacture agricultural commodities - honey and wax - and, more importantly, contribute agricultural services - pollination." Roughly 1/3 of the U.S. diet is comprised of plant-based foods that are pollinated by honey bees. "Although economists differ in calculating the exact dollar value of honey bee pollination to American agriculture, virtually all estimates are in the range of billions (emphasis added) of dollars...Among the most conspicuous demonstrable consequences of honey bee declines in agriculture are the rising costs of producing bees and hence rising costs of honey bee rentals, contributing in turn to rising prices for crops and reductions in consumer welfare. Honey bee declines can reduce crop quality as well as yield...Even before the advent of Colony Collapse Disorder, financial impacts of honey bee shortages have materialized; varroa mites are estimated to have increased honey bee colony rental fees by $30 million annually. Because bee pollination contributes to so many different sectors of the agricultural economy, including the beef and dairy industries (via pollination of clover and other hay and forage crops), disruption of the honey bee supply will likely reverberate across the entire country."
So, why are all the bees dying?
"Diseases carried by foreign bees are just one of the possible causes of colony collapse... Researchers and beekeepers have theorized that the disorder may stem from bee-eating varroa mites or from the pesticide used to kill the mites. Stress on the insects from field-to-field travel has been suggested, too, as have various pesticides and suppression of the bees' immune systems." Non-native farmed honey bees are more susceptible to stress from environmental sources than are organic, or feral honey bees. "Most people think beekeeping is all natural but in commercial operations the bees are treated much like livestock on factory farms." Essentially, left to their own devices, feral honey bees grow smaller and more aggressive compared to commercially bred bees. This agressiveness in turn could help the hive protect itself from the varroa mites thought to be contributing to the death of the colony. It appears that the stresses put on imported hives can be linked to the overall health of the colony. One of the operative hypotheses is that there are multiple and variable causes. If that's the case, that's a problem because we will need multiple and variable solutions."
There was actually a Congressional Hearing on the matter on March 29, 2007 to discuss the magnitude and potential impacts of this problem. "Between 1947 and 2005, colony numbers nationwide declined by over 40%. These losses have occurred as a demand for pollination services has soared for a number of fruit, nut, and vegetable crops, most notably almonds." The honey bee has been partially domesticated for thousands of years to serve purposes for man. "Honey bees are in effect six-legged livestock that both manufacture agricultural commodities - honey and wax - and, more importantly, contribute agricultural services - pollination." Roughly 1/3 of the U.S. diet is comprised of plant-based foods that are pollinated by honey bees. "Although economists differ in calculating the exact dollar value of honey bee pollination to American agriculture, virtually all estimates are in the range of billions (emphasis added) of dollars...Among the most conspicuous demonstrable consequences of honey bee declines in agriculture are the rising costs of producing bees and hence rising costs of honey bee rentals, contributing in turn to rising prices for crops and reductions in consumer welfare. Honey bee declines can reduce crop quality as well as yield...Even before the advent of Colony Collapse Disorder, financial impacts of honey bee shortages have materialized; varroa mites are estimated to have increased honey bee colony rental fees by $30 million annually. Because bee pollination contributes to so many different sectors of the agricultural economy, including the beef and dairy industries (via pollination of clover and other hay and forage crops), disruption of the honey bee supply will likely reverberate across the entire country."
So, why are all the bees dying?
"Diseases carried by foreign bees are just one of the possible causes of colony collapse... Researchers and beekeepers have theorized that the disorder may stem from bee-eating varroa mites or from the pesticide used to kill the mites. Stress on the insects from field-to-field travel has been suggested, too, as have various pesticides and suppression of the bees' immune systems." Non-native farmed honey bees are more susceptible to stress from environmental sources than are organic, or feral honey bees. "Most people think beekeeping is all natural but in commercial operations the bees are treated much like livestock on factory farms." Essentially, left to their own devices, feral honey bees grow smaller and more aggressive compared to commercially bred bees. This agressiveness in turn could help the hive protect itself from the varroa mites thought to be contributing to the death of the colony. It appears that the stresses put on imported hives can be linked to the overall health of the colony. One of the operative hypotheses is that there are multiple and variable causes. If that's the case, that's a problem because we will need multiple and variable solutions."
B$
This website was referred to me by the sexy artist Calyxann. Blog$hares is a fantasy stock market for weblogs. Players get to invest a fictional $500, and blogs are valued by incoming links. It seems like a fun site to play around with. I'll blog more about it once I'm signed up and ready to "trade."
Thursday, May 24, 2007
The Ten-Year Treasury note is at a level of resistance that was last touched (and went unbroken) back in January. The last two months growth for the yield (currently 4.86%) has been parabolic. However, not everyone sees any of this as any bullish significance.
Apple News
Apple Inc. (AAPL) reported retail sales of mac products grew 62% year-over-year through April, with a spectacular 94% spike in notebook sales. Meanwhile, U.S. PC unit growth for the month of April grew 14% overall, with a 19% rise in retail sales and a 30% surge in notebook sales.
Sell-Off Thursday
A later day sell-off brought all the indices into the moving averages they were extended from. Most momentus being the Nasdaq which came down to the 2513 support level established last month and closing below its 20-day MA. The Russell2000 deflated from its all-time highs and dropped back into the channel it was trading in over the previous 6 weeks and through its 20-day MA. The S&P500 came down to its 20-day MA (above average volume) after being over-extended and trying to reach into all-time high territory. Likewise the DJIA coming back into 10-day MA range with above average volume. Correction mode;
Wednesday, May 23, 2007
Oil's at $65.61/barrel, Gold; $663.50/ounce, even the U.S.$ has gained some ground versus its currency pairs. Meanwhile, the DJIA keeps making all-time highs, same with the Russell2000. The S&P500 is doing its best to join the all-time-high club, and the Nasdaq hasn't seen peeks like this in over 6 years. All this with very bullish technical indicators across the boards. So, where's all this money coming from? Dr. Brett Steenbarger touches on the money flow subject in his mid-week posting. He sees unquestionable money flow into large caps, and 5 of the 8 S&P sectors he tracks as having positive net dollar inflow. Long is still the trend.
Hewlett-Packard (HPQ) recently signed a new deal with NASA worth $5.6 billion to provide them with a wide range of hardware. "HP will provide NASA and other federal agencies with desktops, workstations and blade PCs with Linux and Unix capabilities. In addition, the Palo Alto, Calif., company also will provide servers, printers and other equipment."
Stronger, Faster, Cheaper
Cisco Systems (CSCO) announced it is making a 10Gigabit Ethernet more affordable. Coming in June, they will be releasing the optical fiber transceiver adapter for $1,495, compared with about $4,000 for existing 10 Gigabit Ethernet interfaces.
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