US Stocks Slip And Slide On Earnings Concerns, Spanish Debt; VIXY Edges Up, UNG Sinks

Ulli Market Commentary Contact

[Chart courtesy of MarketWatch.com]

US stocks tumbled Tuesday with the Dow and the NASDAQ ending lower for the fourth straight day as investors became wary of corporate earnings looking softer than forecasted based on a string of weak results by technology companies.

Stocks opened strong earlier over news that EU finance ministers agreed late Monday to release an initial €30 billion to Spain by the end of July to help the country shore up its stricken banks.

Treasury 10-year yields slipped as refuge appeal of US assets rose amid concerns the European debt-crisis is deepening after Bank of England Governor Mervyn King said British economy may slip further into a double-dip recession if European leaders fail to act fast. Sentiments soured further after a US survey of small business optimism came in softer than anticipated.

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Server Issues

Ulli Uncategorized Contact

My site has been down intermittently throughout the day. It appears that the problem has now been fixed. Sorry for the inconvenience, but technology is simply not perfect.

Ulli…

US Equities Go Nowhere As Jitters Grow Ahead Of Q2 Results; Merkel Seen At Wimbledon

Ulli Market Commentary Contact

[Chart courtesy of MarketWatch.com]

US stocks finished lower Monday, extending their losing streak for the third straight day as investors became jittery on worries that profits will fall compared to the first quarter after Corporate America lowered earnings forecast as the second quarter earnings season takes off.

US government debt rallied led by the 30-year bonds as Italy’s 10-year bond yields remained above six percent and Spanish 10-year borrowing costs rose over seven percent, touching the danger zone, which boosted demand for safe-haven assets.

The Dow Jones Industrial Average (DJIA) shed 0.3 percent, off about 207 points in the last three down sessions. The S&P 500 Index (SPX) shed 0.2 percent with natural resources faring the worst and health-care topping the charts among its 10 industry groups.

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ETFs/Mutual Funds On The Cutline – Updated Through 7/6/2012

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 398 ETFs, of which currently 235 (last week 249) of them 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 93 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. 38 ETFs (last week 37) have managed to remain in bullish territory after the recent market volatility.

The third report covers Mutual Funds on the Cutline. There are currently 625 (last week 632) above the line and 236 below it out of the 861 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.

Last Week In Review: ETF News And Blog Posts To 7/8/2012

Ulli Market Review Contact

In case you missed it, here’s a summary of the ETF topics and market reviews I posted to my blog during the week ending on 7/8/2012.

The S&P 500 ran out of stream last week after post EU summit euphoria waned while the horrific US jobs report pushed the index to a weekly loss.

The outcome could have been much worse last Friday, but whenever the markets show too much weakness, a well placed rumor can always save the day. This time, it came in form of renewed Q&E hopes that pulled the indexes up and avoided a close at the day’s lows.

Next week, we will be facing the start of the earnings season along with the usual attention grabbing headlines out of Europe about a new mysterious solution to solve all debt issues. It will be interesting to say the least.

This week, we covered the following:

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European Central Bank: No Need For Immediate Non-Standard Measures

Ulli Market Commentary Contact

Following last Friday’s “successful” EU summit in Brussels, global markets were euphoric amid talks of “breakthrough” in the ongoing deadlocked negotiations.

However, as they say, the ‘devil lies in the detail.’ For example, the EU leaders have agreed that the proposed new EU-wide banking regulator will not be set up before the end of 2012. Since issues of national control and sovereignty are involved, chances of the proposed euro-wide central bank supervisory council getting delayed or not taking off at all is very real.

Also, agreement over routing funds from the region’s bailout funds, the EFSF and the ESM, directly to the region’s banks rather than through the national governments in order to keep sovereign debt levels low, goes against the tenets of the European Council, because EU rules allow lending to governments only due to lack of control over foreign banks.

One possible condition to channel funds directly to the banks, as legitimately demanded by the Germans, can be underwriting of loans by national governments, thus compensating for probable losses suffered by the EFSF and the ESM.

However, Benoit Coeure, Executive Board Member of the European Central Bank, doesn’t think non-standard policy measures such as further Long Term Repurchase Operations or quantitative easing, are required immediately.

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