Indexes Make Late Day Swing To Close Positive

Ulli Market Commentary Contact

Thur pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Gains were led mostly by energy stocks as oil prices rebounded slightly after Wednesday’s steep decline. U.S. benchmark crude rose 0.7% to $50.84 a barrel after plunging 6% the previous day on a larger-than-expected inventory build-up.

In tech, shares of Altera (ALTR) rose and Intel (INTC) fell on reports that Intel has ended talks to buy the semiconductor company. In auto news, we heard today that General Motors (GM) is halting production of the Chevy Volt extended-range electric car, because they need to clear out an unsold backlog. Volt sales the first quarter this year are just less than half what they were a year earlier.

The sale of these electric toys, of course, relates directly to the price of gas. With gas prices low so far this year, there has been a large financial disincentive to buy alternative-power vehicles.

And finally, a fun bit of buzz on the street today is that private equity firm Blackstone Group and Wells Fargo are close to a deal buy a real-estate portfolio valued at a whopping $30 billion from General Electric (GE). This has not been confirmed as of yet, but if the transaction did go through, it would be one of the largest real estate deals since pre-financial crisis of 2007.

7 of our 10 ETFs in the Spotlight inched higher while 3 of them dropped. Leading the charge to the upside was Healthcare (XLV) with +0.75%, while SPLV ruled the downside with a slight loss of -0.24%.

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Stocks Respond Well To Fed Minutes; Shell To Buy BG

Ulli Market Commentary Contact

Wed pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Stocks ended up higher after the release of minutes from the Fed’s meeting in March showed policymakers were divided on the timing of the first interest rate hike. The report remained consistent, however, with Fed policymakers’ forecasts that indicate the first hike in rates since 2006 is unlikely to take place before September.

Energy stocks and the oil were in focus today as oil prices slid on a build-up in U.S. inventories and a $70 billion oil merger was announced. U.S. benchmark crude fell 6% to close at $50.42 a barrel in New York after the Energy Information Administration reported a larger-than-expected increase in oil stockpiles last week. Chevron (CVX) dropped 1.7% and ExxonMobil (XOM) fell 2%.

In one of the largest corporate deals of the year, Royal Dutch Shell (RDS.A) agreed to buy Britain’s BG Group (BRGYY) for $70 billion in cash and stock. It is set to be one of the largest corporate deals of the year.

And earnings season began today with Alcoa (AA) reporting after the closing bell. Earnings beat estimates, but revenue was a shortfall. Wall Street analysts remain bearish on Q1 earnings and expect profits for S&P 500 companies to contract 2.8%.

8 of our 10 ETFs in the Spotlight manage to close up in this non-directional day. Consumer Discretionaries (XLY) was the winner with a gain of +0.94%, which was closely followed by Healthcare (XLV) with +0.84%. On the downside, DVY led with a modest loss of -0.19%.

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Post Holiday Hype Fades On Tuesday

Ulli Market Commentary Contact

Tue pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Stocks withered early gains and fell sharply in the last hour of trading, as the major indexes closed lower, breaking a two-day bunny hop winning streak. April has always been a volatile month, as investors are typically on edge in advance of Q1 earnings season. First-quarter earnings season kicks off Wednesday as Alcoa (AA) will be the first to report.

Speaking of the earnings calendar, here’s a quick snapshot of 5 of the Top 10 largest companies earnings release dates. April 14 – Google (GOOG), Wells Fargo &Co (WFC) and Johnson & Johnson (JNJ); April 17 – General Electric (GE); April 22 – Facebook (FB).

Which sectors actually performed today? Health care and energy were the only sectors of the 10 S&P 500 sectors to hold onto gains, while utilities led the market lower as the sector dropped more than 1%.

In M&A news, shares of FedEx (FDX) rose 2.7% after announcing it was expanding into Europe in a $4.8 billion deal to buy Dutch rival TNT Express. The all-cash deal will allow the package delivery company to better compete overseas with United Parcel Service.

9 of our 10 ETFs in the Spotlight slipped and headed south with only healthcare (XLV) bucking the trend by closing up +0.24%.

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Wall Street Bounces Back From Easter Holiday

Ulli Market Commentary Contact

Mon pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Wall Street seemed to ignore the lackluster jobs report that was released Friday when the stock market was closed for Easter. Since bad news is good news these days, equities pushed sharply higher today amid a growing sense that the Fed will push back its first rate hike to sometime in Q3 or later. Gains were led by the energy and utilities sectors as oil prices jumped $2.55.

Tesla (TSLA) took investors for a ride today following news late Friday that the company’s vehicle shipments for Q1 were 5% better than expected. Investors still remain bearish on the stock for the most part due to the fact that it remains below its 200-day moving average.

Those bullish on USD currency may not be so happy today. The dollar fell a fourth day, which is the longest streak of depreciation in nine months. The beloved greenback slipped as a Fed measure of conditions in the labor market slumped.

In more positive economic news, small-business hiring is picking up and could account for most new jobs this year as large companies pull back amid global economic troubles. The NFIB says small businesses added an average 0.18 workers per firm in March, which is one of the best readings in the last decade. Also, small-business credit providers are opening wider. According to Biz2Credit, big banks approved 21.5% of small-business loan requests in February, a post-recession high.

All of our 10 ETFs in the Spotlight edged up with IOO being the front runner sporting a gain of +1.20%, while healthcare (XLV) was lagging the group with +0.15%.

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ETFs/Mutual Funds On The Cutline – Updated Through 04/02/2015

Ulli ETFs on the Cutline Contact

Below are the latest ETF Cutline reports, which show how far above or below their respective long-term trend lines (39 week SMA) my currently tracked ETFs/MFs are positioned.

The first report covers the ETF Master List from Thursday’s StatSheet and includes 410 ETFs, of which currently 288 (last week 266) are hovering in bullish territory.

The second report includes only High Volume ETFs. To clarify, High Volume (HV) ETFs are defined as those with an average daily volume of $10 million or higher.

These ETFs are generated from my selected list of some 97 that I use in my advisor practice. It cuts out the “noise,” which simply means it eliminates those ETFs that I would never buy because of their volume limitations. 47 ETFs (last week 42) have managed to remain in bullish territory after the recent market volatility.

The third report covers Mutual Funds on the Cutline. There are currently 448 (last week 405) above the line and 372 below it out of the 820 that I follow.

Take a look:

  1. ETF Master Cutline Report
  2. ETF High Volume Cutline Report
  3. MF Cutline Report

In case you are not familiar with some of the terminology used in the reports, please read the Glossary of Terms.

If you missed the original post about the Cutline approach, you can read it here.

One Man’s Opinion: Will Europe And Japan See Faster Earnings Growth?

Ulli Market Review Contact

92835431US markets are getting tired and valuations are certainly looking a bit expensive when already this year Europe and Japan have massively outperformed the US market, said Larry Kantor, head of research at Barclays.

While both the US and Europe are benefiting from low inflation and low oil prices, the dollar has strengthened while the euro has gone down, indicating there’s still upside left in Europe.

Also, there’s less fiscal tightening in Europe amid improving credit markets. The European Central Bank’s quantitative easing program has just started and investors are likely to witness better opportunities there, he added.

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