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 Post subject: January 14th Tuesday Trade Results - Profit $3015.00
PostPosted: Tue Jan 14, 2014 10:17 pm 
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Joined: Sat Jan 10, 2009 1:06 pm
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Trade Results of M.A. Perry
Trader and Founder of WRB Analysis (wide range body/bar analysis)
Price Action Trading (no technical indicators)
Phone: +1 708 572-4885
Free Chat Room: http://www.thestrategylab.com/tsl/forum/viewforum.php?f=164
Business Hours: 8am - 5pm est (Mon - Fri)
questions@thestrategylab.com (24/7)
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click on the above image to view today's performance verification

Price Action Trade Performance for Today: Emini TF ($TF_F) futures @ $640.00 dollars or +6.40 points, Emini ES ($ES_F) futures @ $2,375.00 dollars or +47.50 points, Light Crude Oil CL ($CL_F) futures @ $0.00 dollars or +0.00 points, Gold GC ($GC_F) futures @ $0.00 dollars or +0.00 points and EuroFX 6E ($6E_F) futures @ $0.00 dollars or +0.0000 ticks. Total Profit @ $3,015.00 dollars.

Russell 2000 Emini TF Futures: 1 tick or 0.10 = $10.00 dollars and there's more contract information @ The ICE
S&P 500 Emini ES Futures: 1 tick or 0.25 = $12.50 dollars and there's more contract information @ CMEGroup
Light Crude Oil CL (WTI) Futures: 1 tick or 0.01 = $10.00 dollars and there's more contract information @ CMEGroup
Gold GC Futures: 1 tick or 0.10 = $10.00 dollars and there's more contract information @ CMEGroup
EuroFX 6E Futures: 1 tick or 0.0001 = $12.50 dollars and there's more contract information @ CMEGroup

In addition, all of my trades were posted real-time in the chat room. You can read today's chat room logs for details about each one of my trades via price action trading from entry to exit (e.g. time, price, contract size) along with price action commentary as the trade traversed to its completion...all archived @ http://www.thestrategylab.com/ftchat/forum/viewtopic.php?f=126&t=1697

Also, posted below are direct links to information about my price action trade methodology and trading plan (there's a difference between the two) that enables me to identify key trading areas in the price action that represent changes in supply/demand and volatility along with being able to exploit these changes via WRB Analysis (wide range body/bar analysis). I'm primarily a day trader because it suits my personal lifestyle but I do occasionally swing trade and position trade. Simply, my trade method is applicable for position trading, swing trading and day trading.

Image ##TheStrategyLab Chat Room is free. Members and I use the chat room to post WRB Analysis commentary, real-time trades and to post anything else related to trading. The chat room helps me tremendously in my own trading because I use it to document (journal) my thought process from trade to trade so that I can easily review at a later date my thoughts as I interacted with the markets...info I can not get from my broker statements. Also, this is not a signal calling chat room where a head trader tells you when to buy or sell. If you join the chat room and then you do not ask any questions about WRB Analysis in your own trading...the chat room will not be useful to you. Chat room access instructions @ http://www.thestrategylab.com/tsl/forum/viewforum.php?f=164

Image Price Action Analysis via WRB Analysis Tutorials @ http://www.thestrategylab.com/WRBAnalysisTutorials.htm and there's a free study guide of the WRB Analysis Tutorial Chapters 1, 2 and 3 @ http://www.thestrategylab.com/tsl/forum/viewtopic.php?f=119&t=718

Image Trade Signal Strategies via Volatility Trading Report (VTR) @ http://www.thestrategylab.com/VolatilityTrading.htm and there's a free trade signal strategy @ http://www.thestrategylab.com/tsl/forum/viewforum.php?f=89 so that you can freely test drive one of our price action trade strategies with support (answering your questions) prior to purchasing the Volatility Trading Report (VTR).

Image Trading Plan Daily Routine @ http://www.thestrategylab.com/tsl/forum/viewtopic.php?f=229&t=2165

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Market Context Summaries

The below summaries by Bloomberg, CNNMoney, Reuters and Yahoo! Finance helps me to do a quick review of the fundamentals, FED/ECB/BOE/IMF actions or any important global economic events (e.g. Eurozone, MarketWatch.com) that had an impact on today's price action in many trading instruments I monitor during the trading day. Simply, I'm a strong believer that key market events causes key changes in supply/demand and volatility resulting in trade opportunities (swing points and strong continuation price actions) that reach profit targets. Thus, I pay attention to these key market events, intermarket analysis (e.g. Forex EurUsd, EuroFX 6E futures, Gold GC futures, Light Crude Oil (WTI) CL & Brent Oil futures, Eurex DAX futures, Euronext FTSE100 futures, Emini ES futures, Emini TF futures, Treasury ZB futures and U.S. Dollar Index futures) while using WRB Analysis from one trade to the next trade to give me the market context for price action trading before the appearance of my technical analysis trade signals. Therefore, I maintain these archives to allow me to understand what was happening on any given trading day in the past involving key market events to help better understand my trade decisions (day trading, swing trading, position trading)...something I can not get from my broker statements alone.

Stocks Snap Back With Triple-Digit Dow Gain

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click on the above image to view today's price action of key markets

NEW YORK (CNNMoney)
Stocks bounced back Tuesday as investors cheered results from some of the nation's largest financial institutions and also showed enthusiasm about the tech sector.

The Dow jumped 115 points, while the S&P 500 and Nasdaq also ended higher. So did CNNMoney's Tech 30, led by a 4% gain in Intel (INTC, Fortune 500) following positive analyst reports about the chip giant.

After a sharp sell-off Monday, investors turned to bank earnings to get a sense of the economy's health.

JPMorgan Chase (JPM, Fortune 500) posted a fourth-quarter profit of $5.3 billion, including a $1.1 billion write-off for legal expenses. But earnings topped expectations. Shares of JPMorgan ended the day flat.

The bank has settled numerous lawsuits in the past year, including over its behavior in the run-up to the mortgage crisis and for turning a blind eye to Ponzi schemer Bernard Madoff.

But one StockTwits trader isn't buying the stock.

"$JPM...this market definitely at euphoric stage," said 5nancial.

Wells Fargo (WFC, Fortune 500) also released earnings that slightly beat estimates, though it reported a big drop in mortgage activity. Shares finished the day mostly unchanged. But one trader was worried about the mortgage business.

$WFC beats on earnings and revenues, not enough to overcome some key losses in mortgages," said StockTwits user dividenddotcom.

This is just the beginning. Investors are readying themselves for a slew of quarterly earnings announcements over the coming weeks. Four other big banks are due to report their results later this week: Bank of America (BAC, Fortune 500), Citigroup (C, Fortune 500), Goldman Sachs (GS, Fortune 500) and Morgan Stanley (MS, Fortune 500).

Investors have been nervous that earnings may not be strong enough to justify higher stock prices. Mike van Dulken, head of research at Accendo Markets noted that a new report from Goldman Sachs said valuations for the stocks in the S&P 500 were lofty by almost any measure and that further gains may be difficult to achieve.

And after a tepid December jobs report, investors are looking for further signs of strength in the economy.

Retail sales for December came in slightly better than expected, as retailers offered big promotions due to a shortened holiday season.

What's moving: Tesla (TSLA)shares surged almost 16% after bullish comments about fourth quarter deliveries of the Model S from the electric car maker's management at the auto show in Detroit. The stock had a huge rally in 2013 before pulling back a bit towards the end of the year.

Shares of CNNMoney Tech 30 component Microsoft (MSFT, Fortune 500)moved higher despite a downgrade from Citigroup. Wall Street has become increasingly anxious over the tech giant's search for a successor.

Google (GOOG, Fortune 500), another member of the Tech 30, hit an all-time high after the search engine announced Monday afternoon that it was buying connected device maker Nest Labs for $3.2 billion.

StockTwits trader serenityNOW welcomed the news.

"$GOOG...must admit - very smart, forward-looking move," he said.

"$GOOG buy on every dip. Strongest stock on Wall Street," said strategymizer.

Also on Monday, Charter Communications (CHTR, Fortune 500) said it had formally proposed acquiring Time Warner Cable (TWC, Fortune 500). Time Warner Cable flatly rejected the offer. Shares of both companies were trading higher.

Shares of GameStop (GME, Fortune 500)tanked 20% after the video game retailer reported weak holiday season sales.

$GME numbers show more consumers buying online...Hopefully not a sign of weak all around game sales," commented StockTwits trader BrianNichols

European markets finished mostly higher, while Asian markets ended mixed.

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4:10 pm: [BRIEFING.COM] Equity indices followed Monday's broad-based sell-off with a daylong rebound. The S&P 500 gained 1.1% while the Nasdaq (+1.7%) outperformed, turning positive for the year.

After playing a significant part in Monday's weakness, retailers participated in today's rebound as the SPDR S&P Retail ETF (XRT 84.31, +0.95) gained 1.1%. The industry group likely received a slight bump from the December retail sales report, which came in ahead of estimates. However, gauging the true impact of the report was a bit of a challenge considering the November reading was revised lower.

Although most retailers took part in the rebound, GameStop (GME 36.28, -9.04) was not as fortunate. The stock plunged 20.0% after issuing disappointing guidance.

Elsewhere among cyclical groups, the financial sector (+0.8%) was unable to catch up to the broader market as JPMorgan Chase (JPM 57.74, +0.04) and Wells Fargo (WFC 45.59, +0.03) weighed. The pair ended little changed after both reported modest bottom-line beats. Notably, both banks saw large declines in mortgage originations.

Even though all ten sectors ended higher, materials (+1.4%) and technology (+1.9%) were the only outperformers among growth-sensitive groups. The tech sector rallied thanks to all-around support from its components. Top-weighted members like Apple (AAPL 546.39, +10.66), Google (GOOG 1149.40, +26.42), Microsoft (MSFT 35.78, +0.80), and Oracle (ORCL 38.21, +0.46) added between 1.2% and 2.4% while chipmakers displayed strength as well. The PHLX Semiconductor Index surged 2.3% after Intel (INTC 26.51, +1.01) was upgraded to 'Overweight' from 'Neutral' at JPMorgan.

The big gains among tech shares contributed to the outperformance of the Nasdaq, which also drew strength from biotechnology as the iShares Nasdaq Biotechnology ETF (IBB 244.05, +8.54) surged 3.6%. In turn, this underpinned the health care sector (+1.3%), which ended ahead of other defensive groups. The remaining countercyclical sectors-consumer staples (+0.6%), telecom services (+0.4%), and utilities (+0.1%)-lagged.

Treasuries were trapped in a steady downtrend, sending the 10-yr yield higher by four basis points to 2.87%.

Participation was on the light side with only 636 million shares traded at the NYSE.

We would also note that Philadelphia Fed President Plosser and Dallas Fed President Fisher both gave speeches today in which they left an impression that they remain in favor of continued tapering efforts. Both men are FOMC voters this year and both are known for their hawkish stances with respect to the Fed's asset purchase program.

The recognition that the market held up well in the wake of their remarks underscores that a similar view insinuated by Atlanta Fed President Lockhart (who doesn't have an FOMC vote in 2014) on Monday served as a convenient headline excuse to take some profits and was not the primary cause of the weakness.

Today's economic data was limited to a pair of reports.

Retail sales increased 0.2% in December after rising a downwardly revised 0.4% (from 0.7%) in November. The Briefing.com consensus expected no change in the December reading. Given the weak jobs report and the corresponding decline in aggregate wages, there was real potential for a dismal retail sales report. Our analysis of debt trends suggested that consumers could increase their debt load without feeling much pain, but the psychological effect of maintaining high savings was outweighing low debt ratios. It seems that the mental hold on spending may be ending.
Business inventories increased 0.4% in November, down from an upwardly revised 0.8% (from 0.7%) in October. The Briefing.com consensus expected business inventories to increase 0.3%. Total inventories consist of manufacturers, merchant wholesalers, and retailers. Both manufacturers (0.0%) and merchant wholesaler (0.5%) inventories were announced prior to the total inventory release. The only unknown was retailer inventories, which increased 0.8% in November after increasing 1.1% in October.

Tomorrow, the weekly MBA Mortgage Index will be released at 7:00 ET while December PPI and the January Empire Manufacturing survey will both be reported at 8:30 ET. The day's data will be topped off with the 14:00 ET release of the Federal Reserve's Beige Book for January.

Nasdaq +0.2% YTD
Russell 2000 0.0% YTD
S&P 500 -0.5% YTD
DJIA -1.2% YTD

3:30 pm: [BRIEFING.COM]

Feb gold fell for the first time in four sessions as the dollar index chopped around slightly above the unchanged line. The yellow metal rose to a session high of $1254.90 per ounce in morning floor trade but reversed into negative territory. It brushed a session low of $1241.10 per ounce and eventually settled with a 0.5% loss at $1245.20 per ounce
Mar silver popped to a session high of $20.67 per ounce in morning pit action but lost momentum and fell as low as $20.13 per ounce. It managed to erase some of the loss and settled 0.4% lower at $20.28 per ounce
Feb crude oil traded higher today despite the slightly stronger dollar index. Prices gained support on better-than-anticipated retail sales data. Retail sales increased 0.2% in December after rising a downwardly revised 0.4% (from 0.7%) in November, while the Briefing.com consensus expected no change in the reading. The energy component climbed to a session high of $92.88 per barrel and settled at $92.52 per barrel, or 0.8% higher
Feb natural gas extended gains for a third consecutive session, trading in the $4.30-$4.38 per MMBtu range. It settled at $4.37 per MMBtu, booking a gain of 2.3%

3:00 pm: [BRIEFING.COM] The S&P 500 trades higher by 1.0% with one hour remaining in today's session. Earlier, investors received a pair of quarterly reports from JPMorgan Chase (JPM 57.87, +0.17) and Wells Fargo (WFC 45.54, -0.02) but the reaction to their modest bottom-line beats has been fairly subdued. JPMorgan Chase is higher by 0.3% while Wells Fargo sits just below its flat line.

Tomorrow morning, participants will receive another noteworthy report from a major sector component when Bank of America (BAC 16.70, +0.27) announces its results.

Thursday morning will be filled with reports from financials of all sizes with BlackRock (BLK 310.50, +4.02), Citigroup (C 53.80, +0.08), Goldman Sachs (GS 176.49, +0.61), and PNC (PNC 77.94, +0.57) on the schedule.

2:30 pm: [BRIEFING.COM] Quiet afternoon continues with the major averages hovering near their session highs. The S&P 500 registered its entire advance during the first three hours of action, and has held near its best level of the session since then.

The technology sector (+1.8%) led from the open and its outperformance continues at this juncture. Meanwhile, the remaining cyclical groups display gains ranging from 0.7% (financials) to 1.2% (materials).

Elsewhere, health care (+1.2%) trades ahead of the remaining countercyclical sectors while consumer staples (+0.5%), telecom services (+0.1%), and utilities (+0.2%) lag.

2:00 pm: [BRIEFING.COM] The major averages remain near their highs as the afternoon continues. The Nasdaq outperforms with a gain of 1.5% while the S&P 500 trades higher by 0.9%.

Nasdaq outperformance has been a common theme over the past couple months with the relative strength continuing into January. Including today's gain, the tech-heavy index is unchanged this month. Meanwhile, the S&P 500 holds a month-to-date loss of 0.7% while the Dow Jones displays a January decline of 1.4%.

With regard to individual sectors, health care is the only group trading with a January gain (+2.7%) while the next-best sector of the month, financials, is flat so far this month.

1:30 pm: [BRIEFING.COM] The stock market has sprung back to life today amid broad-based buying interest that was pretty much non-existent on Monday.

Some of today's strength can undoubtedly be attributed to short-covering activity as yesterday's sell-off presumably encouraged some bearish posturing that has been caught offside today.

Separately, we would note that Philadelphia Fed President Plosser and Dallas Fed President Fisher both gave speeches today in which they left an impression that they remain in favor of continued tapering efforts. Both men are FOMC voters this year and both are known for their hawkish stances with respect to the Fed's asset purchase program.

The recognition that the market has held up fairly well in the immediate wake of their remarks underscores that a similar view insinuated by Atlanta Fed President Lockhart (who doesn't have an FOMC vote in 2014) on Monday served as a convenient headline excuse to take some profits and was not the primary cause of Monday's weakness.

1:00 pm: [BRIEFING.COM] At midday, equity indices hover near their highs with the Nasdaq (+1.5%) leading its peers. The first half of today's session has seen a steady, broad-based, rebound following yesterday's selloff.

Retailers played a significant part in yesterday's decline but the industry group is rebounding along with the broader market today. The SPDR S&P Retail ETF (XRT 84.29, +0.93) trades higher by 1.1%, but remains down 4.3% in January. Earlier, the group received some support from a better-than-expected December retail sales report; however, a downward revision to November data dampened the overall impact of the report.

Although most retailers are taking part in today's rebound, Gamestop (GME 36.78, -8.54) has bucked the trend. The stock trades lower by 18.9% after issuing below-consensus guidance.

Despite the outperformance of retailers, the consumer discretionary sector (+0.6%) trails the S&P 500.

Even though all ten sectors sport gains, only three groups-health care (+1.1%), materials (+1.2%), and technology (+1.6%)-trade ahead of the broader market. Notably, the technology sector has received support from many of its top-weighted components as Apple (AAPL 544.00, +8.27), Google (GOOG 1143.10, +20.12), Microsoft (MSFT 35.78, +0.80), and Oracle (ORCL 38.15, +0.40) display gains between 1.1% and 2.3%. Chipmakers have also displayed strength after Intel (INTC 26.42, +0.93) was upgraded to 'Overweight' from 'Neutral' at JPMorgan. Intel trades up 3.7% while the PHLX Semiconductor Index trades higher by 2.1%.

Elsewhere among cyclical groups, the financial sector (+0.8%) has struggled to keep pace with the broader market. JPMorgan Chase (JPM 57.84, +0.14) and Wells Fargo (WFC 45.61, +0.05) hover just above their flat lines after both reported modest bottom-line beats on in-line revenues. Also of note, both banks saw large declines in mortgage originations.

Treasuries hover near their lows with the 10-yr yield up five basis points at 2.88%.

Today's economic data was limited to a pair of reports.

Retail sales increased 0.2% in December after rising a downwardly revised 0.4% (from 0.7%) in November. The Briefing.com consensus expected no change in the December reading. Given the weak jobs report and the corresponding decline in aggregate wages, there was real potential for a dismal retail sales report. However the downward revision to November data removed some of the shine from the report.
Business inventories increased 0.4% in November, down from an upwardly revised 0.8% (from 0.7%) in October. The Briefing.com consensus expected business inventories to increase 0.3%. Total inventories consist of manufacturers, merchant wholesalers, and retailers. Both manufacturers (0.0%) and merchant wholesaler (0.5%) inventories were announced prior to the total inventory release. The only unknown was retailer inventories, which increased 0.8% in November after increasing 1.1% in October.

12:30 pm: [BRIEFING.COM] Not much has changed since our last update as the key indices remain near their best levels of the day.

Even though the S&P 500 (+0.9%) sits on its high, only three groups-health care (+1.1%), materials (+1.2%), and technology (+1.7%)-trade ahead of the broader market. Due to its size, the materials sector has little impact on the performance of the broader market while health care and technology represent nearly a third of the entire S&P 500.

Yesterday's selling sparked a big jump in the CBOE Volatility Index (VIX 12.08, -1.20) as participants scrambled in search of downside protection. Today, however, the near-term volatility measure has given up yesterday's entire gain, which puts the index on track for its lowest finish of the month.

12:00 pm: [BRIEFING.COM] The major averages hover near their highs with the Nasdaq (+1.2%) maintaining its lead.

With the market rebounding from yesterday's broad losses, the Nasdaq has received significant support from biotechnology (IBB 240.13, +4.62), chipmakers (PHLX Semiconductor Index +1.9%), and many top-weighted components like Apple (AAPL 544.56, +8.83), Google (GOOG 1143.10, +20.12), and Microsoft (MSFT 35.64, +0.67). Furthermore, momentum names have also factored into the outperformance of the Nasdaq.

Staying on the theme of momentum names, Tesla (TSLA 144.27, +4.93) surged to a session high after Bloomberg reported that the company had 6,900 deliveries during the fourth quarter after guiding for roughly 6,000 deliveries. Earlier, the stock traded in the red after the company announced it will replace chargers for certain Model S vehicles due to potential issues with the equipment.

11:30 am: [BRIEFING.COM] Recent action saw equities continue their climb with the Nasdaq extending its gain to 1.2%. The S&P 500 trades higher by 0.8% while the Dow Jones Industrial Average (+0.4%) lags.

The price-weighted index trails the broader market as five of its components hover in the red. Of the five decliners, only Boeing (BA 138.30, -2.40) and Merck (MRK 52.53, -0.59) display losses in excess of 1.0%. Merck is pulling back after jumping 6.5% yesterday while Boeing trades down 1.7% amid reports Japan Airlines has experienced problems with a 787 jet.

On the upside, Intel (INTC 26.40, +0.90) is the leading Dow component, up 3.5%.

10:55 am: [BRIEFING.COM] The major averages have climbed to fresh highs with the Nasdaq (+0.9%) pacing the rally. The outperformance of the tech-heavy index is being mirrored by the technology sector, which trades with a solid gain of 1.1%.

The sector has drawn considerable strength from chipmakers after Intel (INTC 26.38, +0.88) was upgraded to 'Overweight' from 'Neutral' at JPMorgan. Intel trades higher by 3.4% while the broader PHLX Semiconductor Index sports an advance of 1.7%.

The tech sector is the only group trading with a gain larger than 1.0% while other cyclical sectors are up between 0.2% (financials) and 0.7% (energy). The energy sector outperforms as crude oil trades higher by 0.6% at $92.35 per barrel.

10:35 am: [BRIEFING.COM] Commodities are mixed this morning, while the dollar index is modestly higher.

Silver futures just spiked to a new HoD a few minutes ago. Gold popped higher too, but in a much small move. However, gold just hit a new HoD now as well. Feb gold is now +0.2% at $1253.10/oz, while Mar silver is +0.9% at $20.57/oz.

Feb crude oil futures rallied earlier this morning and rose as high as $92.75/barrel. It has since been sliding lower and is now +0.7% at $92.45/barrel. Natural gas is extending gains this morning following yesterday's +6% run, which was a weather-driven move. Feb nat gas is currently +1.2% at $4.33/MMBtu.

10:00 am: [BRIEFING.COM] Equity indices continue to hover near their early highs.

Just reported, November business inventories rose 0.4%, which was above the 0.3% increase expected by the Briefing.com consensus. This follows the prior month's revised increase of 0.8% (from +0.7%).

9:40 am: [BRIEFING.COM] As expected, the major averages began the session on an upbeat note. The S&P 500 trades higher by 0.3% with eight sectors registering gains.

Cyclical groups paced yesterday's selloff and they are seeing the largest gains in the early going. On that note, energy, financials, materials, and technology trade with gains between 0.4% and 0.6%.

In the financial sector, JPMorgan Chase (JPM 58.25, +0.55) is higher by 0.9% while Wells Fargo (WFC 45.14, -0.42) holds a loss of 0.9% after both names reported bottom-line beats on in-line revenues.

Over on the countercyclical side, all four groups trail the broader market. Consumer staples and health care hold respective gains of 0.2% and 0.3% while telecom services and utilities trade little changed.

9:13 am: [BRIEFING.COM] S&P futures vs fair value: +5.00. Nasdaq futures vs fair value: +11.50. The major averages are poised to begin the session with modest gains. The S&P 500 futures trade five points above fair value as the benchmark index will look to rebound after ending yesterday's session at its lowest level of the year.

Yesterday, retailers pressured the broader market after several companies issued cautious guidance. Today, the futures market received a slight boost from a better-than-expected December retail sales report (+0.2% actual versus Briefing.com consensus 0.0%); however, the above-consensus number was somewhat overshadowed by a downward revision to November figures (to +0.4% from 0.7%).

With the fourth-quarter earnings season heating up, the market received a pair of reports from two major financials but the early reaction has been mixed. JPMorgan Chase (JPM 58.10, +0.40) holds a pre-market gain of 0.7% after beating bottom-line estimates by six cents on in-line revenue. Elsewhere, Wells Fargo (WFC 45.35, -0.21) trades down 0.5% despite beating earnings estimates by two cents on in-line revenue.

Treasuries hover near their lows with the 10-yr yield up nearly three basis points at 2.86%.

8:57 am: [BRIEFING.COM] S&P futures vs fair value: +5.70. Nasdaq futures vs fair value: +13.00. The S&P 500 futures trade six points above fair value.

Markets across Asia ended mostly lower following yesterday's slide on Wall Street. Economic data was limited as Japan's current account deficit widened to JPY593 billion from JPY128 billion (JPY380 billion expected) while the adjusted current account deficit narrowed to JPY50 billion from JPY60 billion (JPY20 billion consensus). Separately, the Economy Watchers Current Index rose to 55.7 from 53.5 (54.2 expected). Elsewhere, South Korea's trade surplus narrowed to $3.65 billion from $3.70 billion and New Zealand's Electronic Card Retail Sales rose 0.6% month-over-month (0.6% last) while the year-over-year reading rose 5.5% (6.7% prior).

Japan's Nikkei fell 3.1% as traders returned to work to find the yen had strengthened to 103.00 against the dollar. Heavyweight Fast Retailing slid 5.0% and Toyota Motor gave up 2.3%.
Hong Kong's Hang Seng shed 0.4%, narrowly avoiding its lowest close in two months. Financial lagged as Industrial & Commercial Bank of China and China Construction Bank fell 0.4% and 0.5%, respectively.
China's Shanghai Composite gained 0.9%, receiving a boost after upbeat GDP forecasts from several tier 1 analysts. Great Wall Motor climbed 5.1% after a Xinhua report indicated the military is looking to buy domestic cars for its fleet.

Major European indices have spent the first half of the session in a steady climb off their opening lows. Economic data was plentiful. Eurozone Industrial Production rose 1.8% month-over-month (1.4% forecast, -0.8% last) while the year-over-year reading climbed 3.0% (1.4% expected, 0.5% prior). Germany's WPI ticked up 0.4% month-over-month (0.1% forecast, -0.2% previous). Great Britain's CPI increased 0.4% month-over-month (0.5% expected, 0.1% prior) while the year-over-year reading rose 2.0% (2.1% forecast, 2.1% last). Separately, core CPI rose 1.7% year-over-year (1.8% forecast, 1.8% last) and input PPI ticked up 0.1% month-over-month (-0.2% expected, -0.7% prior). Also of note, the House Price Index jumped 5.4% year-over-year (5.9% consensus, 5.5% last). French CPI rose 0.4% month-over-month, as expected (0.0% last) while the current account deficit narrowed to EUR1.90 billion from EUR2.00 billion (EUR2.30 billion expected). Elsewhere, Italy's CPI ticked up 0.2% month-over-month (0.2% prior) while the year-over-year reading rose 0.7% (0.7% last). Both figures met expectations.

Great Britain's FTSE is flat. British Sky Broadcasting outperforms with a gain of 3.9% after confirming it bought back shares.
France's CAC is lower by 0.2% as growth-sensitive names lag. Technip, Vallourec, and Vinci are all down between 1.5% and 1.7%. GDF Suez outperforms with a modest gain of 0.3%.
In Germany, the DAX trades down 0.3% with financials contributing to the weakness. Commerzbank and Deutsche Boerse are lower by 1.1% and 0.7%, respectively.

8:32 am: [BRIEFING.COM] S&P futures vs fair value: +4.70. Nasdaq futures vs fair value: +10.50. The S&P 500 futures trade almost five points above fair value.

December retail sales ticked up 0.2% while the Briefing.com consensus expected no change. The prior month's reading was revised to reflect an increase of 0.4% (from +0.7%).

Excluding autos, retail sales increased 0.7% against the expectations of a 0.4% rise. Last month's reading was revised down to indicate growth of 0.1% (from +0.4%).

Export prices, excluding agriculture, ticked up 0.3% in December after increasing 0.1% in the prior reading. Excluding oil, import prices ticked down 0.1%, which follows last month's unchanged reading.

8:00 am: [BRIEFING.COM] S&P futures vs fair value: +4.70. Nasdaq futures vs fair value: +10.20. U.S. equity futures hold modest pre-market gains with the S&P 500 futures trading five points above fair value.

Reviewing overnight developments:

Asian markets ended mixed. China's Shanghai Composite +0.9%, Hong Kong's Hang Seng -0.4%, and Japan's Nikkei -3.1%.
Investors received several economic data points:
Japan's current account deficit widened to JPY593 billion from JPY128 billion (JPY380 billion expected) while the adjusted current account deficit narrowed to JPY50 billion from JPY60 billion (JPY20 billion consensus). Separately, the Economy Watchers Current Index rose to 55.7 from 53.5 (54.2 expected).
South Korea's trade surplus narrowed to $3.65 billion from $3.70 billion.
New Zealand's Electronic Card Retail Sales rose 0.6% month-over-month (0.6% last) while the year-over-year reading rose 5.5% (6.7% prior).
In news:
In China, five companies set to make their market debut delayed their IPOs after the Securities Regulatory Commission tightened IPO policies.

Major European indices have climbed off their opening lows but they remain in the red. Germany's DAX -0.2%, France's CAC -0.2%, and Great Britain's FTSE is flat.
In economic data:
Eurozone Industrial Production rose 1.8% month-over-month (1.4% forecast, -0.8% last) while the year-over-year reading climbed 3.0% (1.4% expected, 0.5% prior).
Germany's WPI ticked up 0.4% month-over-month (0.1% forecast, -0.2% previous).

Great Britain's CPI increased 0.4% month-over-month (0.5% expected, 0.1% prior) while the year-over-year reading rose 2.0% (2.1% forecast, 2.1% last). Separately, core CPI rose 1.7% year-over-year (1.8% forecast, 1.8% last) and input PPI ticked up 0.1% month-over-month (-0.2% expected, -0.7% prior). Also of note, the House Price Index jumped 5.4% year-over-year (5.9% consensus, 5.5% last).
French CPI rose 0.4% month-over-month, as expected (0.0% last) while the current account deficit narrowed to EUR1.90 billion from EUR2.00 billion (EUR2.30 billion expected).
Italy's CPI ticked up 0.2% month-over-month (0.2% prior) while the year-over-year reading rose 0.7% (0.7% last). Both figures met expectations.
Among news of note:
European Commission President Jose Manuel Barroso said the Eurozone recession is over but complacency must be avoided.

In U.S. corporate news:

Cliffs Natural Resources (CLF 22.85, +0.49): +2.2% following a Deutsche Bank upgrade to 'Buy' from 'Hold.'
Google (GOOG 1140.05, +17.07): +1.5% after the company acquired Nest Labs for $3.2 billion in cash.
Intel (INTC 26.06, +0.56): +2.2% after JPMorgan upgraded the stock to 'Overweight' from 'Neutral.'
JPMorgan Chase (JPM 57.75, +0.05): +0.1% after beating bottom-line estimates by six cents on in-line revenue. Notably, mortgage originations saw a 54.0% year-over-year decline and investment banking fees fell 3.0% year-over-year.
Microsoft (MSFT 34.70, -0.28): -0.8% following a Citigroup downgrade to 'Neutral' from 'Buy.'

December Retail Sales as well as December export prices ex-agriculture and import prices ex-oil will be reported at 8:30 ET while the November Business Inventories report will cross the wires at 10:00 ET.

6:20 am: [BRIEFING.COM] S&P futures vs fair value: +3.00. Nasdaq futures vs fair value: +5.00.

6:20 am: [BRIEFING.COM] Nikkei...15422.40...-489.70...-3.10%. Hang Seng...22791.28...-97.50...-0.40%.

6:20 am: [BRIEFING.COM] FTSE...6746.58...-10.50...-0.20%. DAX...9456.35...-47.50...-0.50%.

S&P 500 Has Year’s Biggest Gain on Retail Sales, Mergers

By Lu Wang and Callie Bost Jan 14, 2014 4:41 PM ET

U.S. stocks rose, giving the Standard & Poor’s 500 Index its biggest gain of the year, as better-than-forecast retail sales and corporate merger activity signaled confidence in the economy.

Intel Corp. and Jabil Circuit Inc. paced gains among technology companies, rising at least 4 percent amid analyst upgrades. Google (GOOG) Inc. added 2.4 percent after agreeing to buy digital-thermostat maker Nest Labs Inc. for $3.2 billion in cash. Time Warner Cable Inc. climbed 2.7 percent after rejecting an acquisition offer from Charter Communications Inc. JPMorgan Chase & Co. and Wells Fargo & Co. were little changed after reporting fourth-quarter results.

The S&P 500 (SPX) added 1.1 percent to 1,838.88 at 4 p.m. in New York, posting the biggest jump since Dec. 18 and erasing most of yesterday’s loss. The Dow Jones Industrial Average gained 115.92 points, or 0.7 percent, to 16,373.86. About 6.5 billion shares changed hands on U.S. exchanges, 7.7 percent above the 30-day average.

“We’re probably at the stage in the stock market cycle where good news will continue to be seen as good news,” Martin Leclerc, founder of Barrack Yard Advisors LLC, which oversees $270 million, said in a telephone interview. “I would say that after this massive move we’ve had, it does feel like the animal spirits are still resurrected.”

The S&P 500 fell 1.3 percent yesterday, the most since November, as investors weighed valuations after a 30 percent rally last year that sent the gauge to a record. The benchmark index dropped 1.6 percent in January through yesterday for the worst start to a year since 2009.

The index trades at 15.6 times the estimated earnings of its members, more than the average multiple of 14.1 over the last five years, data compiled by Bloomberg show. The S&P 500 ended 2013 at its highest valuation since the end of 2009.

Corporate Earnings

Wells Fargo and JPMorgan are among companies reporting financial results today. Bank of America Corp., Citigroup Inc. and Goldman Sachs Group Inc. report later this week. Earnings for companies in the index probably climbed 4.9 percent on average in the fourth quarter, while sales increased 1.8 percent, according to analyst estimates compiled by Bloomberg.

“Earnings are going to dominate for the next two or three weeks,” Patrick Kaser, a managing director and portfolio manager at Brandywine Global Investment Management in Philadelphia, said by phone. His firm oversees about $50 billion. “People are concerned about the rate of growth in the economy. How we finished the quarter going into January, that’s going to matter the most for where we are right now.”

Economic Data

U.S. retail sales increased 0.2 percent after a 0.4 percent advance in November that was smaller than previously reported, Commerce Department figures showed today in Washington. The median forecast of 86 economists surveyed by Bloomberg called for a 0.1 percent gain. Excluding cars, demand jumped by the most in almost a year.

Investors are watching economic data for signals on the pace of Federal Reserve stimulus cuts. Three rounds of monetary stimulus from the central bank have helped push the S&P 500 higher by 172 percent from a 12-year low in 2009. The Fed, which next meets Jan. 28-29, last month announced a reduction in its monthly bond-buying program, citing a recovery in the labor market.

A government report on Jan. 10 showed employment rose in December at the slowest pace in almost three years. The data ended months of improving job growth that had signaled the world’s largest economy was picking up.

Stocks extended losses yesterday after Fed Bank of Atlanta President Dennis Lockhart said weak payroll growth last month shouldn’t discourage policy makers from reducing monthly bond purchases as long as the economy continues to gain strength.

‘Beer Goggles’

Philadelphia Fed President Charles Plosser said today that the central bank’s stimulus program should end later this year because the economy is on a “firmer footing” than it has been in the past several years.

Richard Fisher, Fed president in Dallas, likened quantitative easing to “beer goggles” that makes everything look good. There are signs that “we have made for an intoxicating brew as we have continued pouring liquidity down the economy’s throat,” he said in a speech today.

The Chicago Board Options Exchange Volatility Index (VIX), which measures expected swings on the S&P 500 using options prices, dropped 7.5 percent today to 12.28. The gauge is down 11 percent this year.

Tech Rally

All 10 main industries in the S&P 500 advanced. The Morgan Stanley Cyclical Index climbed 1.4 percent, reversing a 1.4 percent drop yesterday. The Dow Jones Transportation Average added 1.3 percent, the most since Oct. 16. Microsoft Corp., Visa Inc., 3M Co. and Walt Disney Co. increased at least 1.6 percent to pace gains among the largest companies.

The Nasdaq-100 Index jumped 1.9 percent, the most since Oct. 10, as technology companies in the S&P 500 rallied 1.9 percent as a group.

Intel rose 4 percent to $26.51 for the biggest increase in the Dow. The maker of computer chips was raised to overweight from neutral by Christopher Danely, an analyst with JPMorgan (JPM) Chase, on expectation the personal-computer market will remain stable this year and new Chief Executive Officer Brian Krzanich will focus on areas where Intel has an advantage.

Jabil Circuit advanced 7.8 percent to $17.89. The maker of electronics for Apple Inc. was boosted to buy from neutral by Goldman Sachs.

Google Purchase

Google Inc. added 2.4 percent to $1,149.40, an all-time high, after saying it will buy Nest Labs. The deal is contributing to greater confidence among venture-capital firms, which often bet on companies before they have revenue or even a product.

Proposed deals by companies including Charter and Google brought the value of takeover offers worldwide this year to $130 billion, data compiled by Bloomberg show.

Time Warner Cable (TWC) rose 2.7 percent to $136. The broadband-service provider’s chief executive officer, Rob Marcus, called Charter’s $132.50-a-share bid a “low-ball offer.” The proposal included about $83 cash per share and about $49.50 in stock. Excluding debt, the deal would have been worth $37.3 billion.

Intuitive Surgical Inc. rallied 6.8 percent to $419.88. The maker of robot surgery systems said fourth-quarter revenue was $576 million, beating the average analyst estimate of $549.1 million in a Bloomberg survey.

Regeneron, Tesla

Regeneron Pharmaceuticals Inc. (REGN) jumped 12 percent to $300.32 for the biggest increase in the S&P 500. Sales of the eye drug Eylea, the company’s top-selling product, were about $400 million last quarter, Chief Executive Officer Len Schleifer said. That exceeded the $377.5 million average of eight analysts’ estimates compiled by Bloomberg.

Tesla Motors Inc. surged 16 percent to $161.27, the highest level in two months. The maker of high-end electric cars delivered 6,900 Model S sedans in the fourth quarter, lifting full year sales of the vehicle beyond the company’s target.

JPMorgan added less than 0.1 percent to $57.75. Quarterly profit fell 7.3 percent on $2.6 billion of settlements tied to Bernard Madoff’s Ponzi scheme as rising legal costs ended the firm’s three-year streak of record annual earnings.

Wells Fargo rose less than 0.1 percent to $45.59. The largest U.S. home lender posted record fourth-quarter and full-year profit as expense cuts and one-time gains bolstered results.

While Wells Fargo’s profit was enough to beat the consensus of Wall Street analysts, mortgage applications plunged and Oppenheimer & Co.’s Chris Kotowski said in a note to clients that results were helped by reserve releases and gains on securities.

GameStop (GME) Corp. plunged 20 percent, the most in the S&P 500, to $36.31. The largest specialty retailer of video games cut its full-year profit forecast amid lower-than-anticipated software sales and reduced gross margin from Sony Corp.’s PlayStation 4 and Microsoft Corp.’s Xbox One consoles during the holiday shopping period.

Special thanks to Bloomberg, CNNMoney, Reuters and Yahoo! Finance for their market summaries. gm

Best Regards,
M.A. Perry
Trader and Founder of WRB Analysis (wide range body/bar analysis)
Image@ http://twitter.com/wrbtrader Image@ http://stocktwits.com/wrbtrader

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