Markets Get Boost From Russia-Ukraine Cease-Fire

Ulli Market Commentary Contact

Thur pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Stocks continued to climb as investors were encouraged by Russia and Ukraine announcing a cease-fire. The S&P 500 moved within two points of a record closing high and the Nasdaq is at its highest level since March 2000.

Advances today were mostly led by technology stocks in the Nasdaq. However, Cisco (CSCO) was a big gainer that pushed the Dow higher after it announced earnings that exceeded analysts’ expectations.

We did hear some disappointing economic news today. The number of Americans seeking unemployment benefits jumped last week and jobless claims rose 25,000 to a seasonally adjusted 304,000. In addition, we also heard that retail sales fell 0.8% in January despite lower gas prices.

Do you shop at Costco? Do you use an American Express? Well, shares of American Express (AXP) took a dive today after the company revealed that it is ending its long-standing co-branding relationship with the wholesaler. Amex cards have been the only form of credit accepted at the store, but all that will come to an end on March 31, 2016.

With today’s straight up move, it comes as no surprise that all of our 10 ETFs in the Spotlight joined the party and closed on the plus side. Leading the group was IOO with a +1.36% gain on hopes that the Greek issue can be resolved and that the Ukraine Cease Fire holds. Four ETFs made new highs for the year.

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Stocks Flat Line Wednesday; Tesla Posts Big Losses

Ulli Market Commentary Contact

Wed pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

In the international realm, investors appeared to take a sideline approach as eurozone finance ministers gathered in Brussels to discuss debt-strapped Greece. The fate of cash-strapped Greece, which has become front-page news as its new anti-austerity government looks to get bailout concessions from its eurozone creditors, could become clearer as an emergency meeting of finance ministers was addressing Greece’s appeal for more generous bailout conditions.

In auto news, after markets closed today, Tesla Motors (TSLA) said that it lost $107.6 million in Q4 2014. This did not bode well with investors, given the fact that for all of 2014, the maker of electric luxury cars reported a loss of $294 million, vs. a loss of $74 million for all of 2013. Commenting on the matter, Musk said Tesla plans to boost annual production from a projected 50,000 cars this year to 500,000 by 2020, saying that strong markets in the U.S. and China will support such enormous growth.

And in tech news, Cisco Systems Inc. (CSCO) showed more signs of a rebound in its latest quarter, as demand for new hardware outweighed a headwind from currency exchange rates. The big manufacturer of networking equipment said revenues increased 7% in the second fiscal period, an improvement over the 1.3% growth reported for the first period. Net income apparently rose 68%, despite costs associated with recent job cuts.

Our 10 ETFs in the Spotlight provided a mixed picture with 5 of them gaining and 5 of them slipping; however, one of them made a new high for the year.

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Stocks Snap Losing Streak; Apple Now Worth $700 Billion

Ulli Market Commentary Contact

Tue pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Stocks broke out of a two-day losing streak today as the S&P 500, Dow and Nasdaq all gained. The Dow got a boost today from a strong earnings report posted by Coca-Cola (KO). Coke topped earnings-per-share expectations by 2 cents on better-than-expected revenue of $10.87 billion. Shares of the stock jumped up close to 3%.

Of course, one of the biggest news stories was Apple (AAPL). Shares of the beloved tech company gained 1.9% to a price point of $122.02, which pushed the company’s net worth close to $710.7 billion. Once again, newspapers are raving about the fact that Apple is now the world’s first $700 billion company. Microsoft (MSFT) was the first company to close with a $600 billion valuation back in 2000. Apple has made a run at $700 billion before, but wasn’t ever able to close there until today.

It wasn’t all beautiful news for every sector today. Energy stocks fell as the price of benchmark U.S. crude dropped $2.84 to close at $50.02 a barrel on the New York Mercantile Exchange. The drop came after the International Energy Agency said that the rebound in prices of late will be “comparatively limited in scope.” Apparently, analysts at Citigroup agreed, saying that rising inventory costs could push the price of oil as low as $20 a barrel.

In an abrupt reversal from yesterday, all our 10 ETFs in the Spotlight joined the rally and closed higher with healthcare (XLV) leading the pack. One new high was made, and 9 of them are now on the plus side for the year.

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The World Drags Down Domestic Markets

Ulli Market Commentary Contact

Mon pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Concerns about the world economy dragged U.S. stocks lower on Monday with worries mounting over Greece’s standoff with its creditors. Greece’s defiant new government is waging a high-stakes poker game with its European lenders it seems. These games could go on forever though, as we all know.

According to Barclays, risk assets, including stocks in Europe and the U.S., are being weighed down following Greece’s insistence “not to seek an extension of its current bailout program.” The Greek drama is heating up as investors confront the prospect of a Greek default or an exit from the Eurozone. Still, global investors are hopeful a deal will be struck and the worst-case outcome avoided.

In oil news, retailers are preparing to report results from their most important quarter of the year, Q4. Retailers’ Q4 results are riding on high expectations that cheaper gas led consumers to splurge during the important holiday shopping season. Consumers already benefited last year from steady growth in jobs and low inflation, so let’s see how this year turns out.

On the positive side, in the toy world, Hasbro (HAS) jumped $3.92, or 7%, to $59.66 after the toy company turned in stronger quarterly results. Sales of toys geared toward boys surged, led by Transformers, Nerf and Marvel-brand action heroes. Hasbro also raised its dividend and expanded plans to buy back its own shares.

All our 10 ETFs in the Spotlight headed south as an initial rebound failed pushing the indexes lower. YTD, 5 of them are currently showing gains.

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ETFs/Mutual Funds On The Cutline – Updated Through 02/06/2015

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 253 (last week 196) 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. 41 ETFs (last week 34) have managed to remain in bullish territory after the recent market volatility.

The third report covers Mutual Funds on the Cutline. There are currently 310 (last week 191) above the line and 510 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: Have Markets Started To Believe Zero Interest Rate Is Normal?

Ulli Market Review Contact

92835431The latest US jobs report showing 257,000 nonfarm jobs being created in January has been extremely positive. It shows a higher participation rate along and less-sluggish wage growth, indicating a more inclusive recovery, said Mohammad El-Erian, former CEO of PIMCO and a Bloomberg View columnist.

The latest report showed wages grew 2.2 percent year-over-year while the month-over-month wage-growth was the best in six years. Asked to comment, Mohammad said growth in wages was certainly better but the economy needs to maintain the current pace of employment creation.

Many economists believed it’s just a matter of time before wages responded to the brisk pace of job-creation (3.1 million jobs were created last year), while there were others who wondered if stalled wage-growth indicated deeper structural issues. There’s no doubt the January reading is great, but the pace needs to be sustained going forward, he noted.

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