Bulls Do Not Wait For Scotland Or Alibaba
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September 18, 2014

9-19-2014 1-21-36 AM Scotland

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Stocks opened higher and stayed there in ramped and camped fashion on carryover from yesterday’s Fed result and some economic data. Let’s not forget that the excitement surrounding the Alibaba IPO has gone over the top. Also, most retail investors would be lucky to get any of these shares on the initial price. That’s the way the IPO market goes, hot issues are fully spoken for and you’d have to hope your investment advisor is among those who gets stock on the come or it’s included in indexes and ETFs you’re involved with.

Economic data in the U.S. was mixed but bulls chose to bet on excellent Jobless Claims data (280K vs 300K expected & prior 316K). This was the best report in 14 years. Other indicators weren’t that positive. The Philly Fed Survey declined slightly to 22.5 vs 23 expected & prior 28. Housing Starts were also weak (956K vs 1.038M expected & prior 1.093M).

The results of the Scotland referendum won’t be known until early Friday morning as polls do not close there until 10 PM local time. A “yes” vote would make for a frantic Friday for equity and currency markets. But polls have the vote going the “no” way and investors accepted that as likely Thursday placing bullish bets.

Elsewhere doomsday speakers are still omnipresent led first by David Stockman who appeared on Yahoo today arguing a liquidity bubble has been created which will end badly despite current equity marker exuberance. Less strident was an article today by Mohamed Al-Arian who noted six things investors with rose colored glasses are ignoring, including: Geopolitical unrest; European weakening economy; Mid-Term elections; Japan’s experiment with Abenomics; Emerging Markets from Brazil, China and India concerns; and excessive stock buybacks and M&A by corporations. This is the “wall of worry” current markets are climbing. Frankly as Stockman notes, there’s no telling when the liquidity bubble will pop.

Leading market sectors higher included: Financials (XLF), Banks (KBE), Regional Banks (KRE), Materials (XLB), Industrials (XLI), Healthcare (XLV), Biotech (IBB), Semiconductors (SMH), India (EPI), EAFE (EFA), Europe (VGK), Germany (EWG), Thailand (THD), Indonesia (IDX), Solar (TAN), Pound Sterling (FXB) and Dividend ETFs like (DWX).

Leading market sectors lower included: Gold Miners (GDX), Metals & Miners (XME), Natural Gas Producers (FCG), Energy (XLE), REITs (IYR), Utilities (XLU), South Korea (EWY), Brazil (EWZ), Turkey (TUR), Russia (RSX), Coal (KOL), Commodity Tracking ETF (DBC), Base Metals (DBB), Crude Oil (USO), Natural Gas (UNG) and Agriculture (DBA)

The top 20 market movers by percentage change in volume whether rising or falling is available daily.

Volume was about average for the last three months and breadth per the WSJ was positive.

9-19-2014 1-22-50 AM Diary

Charts of the Day
  • SPY 5 MINUTE

    SPY 5 MINUTE

  • SPX WEEKLY

    SPX WEEKLY

  • INDU WEEKLY

    INDU WEEKLY

  • RUT WEEKLY

    RUT WEEKLY

  • NDX WEEKLY

    NDX WEEKLY

  • QQEW WEEKLY

    QQEW WEEKLY

  • XLF WEEKLY

    XLF WEEKLY

  • KBE WEEKLY

    KBE WEEKLY

  • KRE WEEKLY

    KRE WEEKLY

  • XLE WEEKLY

    XLE WEEKLY

  • XLU WEEKLY

    XLU WEEKLY

  • IYR WEEKLY

    IYR WEEKLY

  • CVY WEEKLY

    CVY WEEKLY

  • DWX WEEKLY

    DWX WEEKLY

  • IEF WEEKLY

    IEF WEEKLY

  • UUP WEEKLY

    UUP WEEKLY

  • FXE WEEKLY

    FXE WEEKLY

  • FXB WEEKLY

    FXB WEEKLY

  • GLD WEEKLY

    GLD WEEKLY

  • GDX WEEKLY

    GDX WEEKLY

  • SLV WEEKLY

    SLV WEEKLY

  • DBB WEEKLY

    DBB WEEKLY

  • USO WEEKLY

    USO WEEKLY

  • DBA WEEKLY

    DBA WEEKLY

  • DBC WEEKLY

    DBC WEEKLY

  • EFA WEEKLY

    EFA WEEKLY

  • IEV WEEKLY

    IEV WEEKLY

  • EEM WEEKLY

    EEM WEEKLY

  • EWC WEEKLY

    EWC WEEKLY

  • EWA WEEKLY

    EWA WEEKLY

  • EWI WEEKLY

    EWI WEEKLY

  • RSX WEEKLY

    RSX WEEKLY

  • EPI WEEKLY

    EPI WEEKLY

  • FXI WEEKLY

    FXI WEEKLY

  • NYMO DAILY

    NYMO DAILY

    The NYMO is a market breadth indicator that is based on the difference between the number of advancing and declining issues on the NYSE. When readings are +60/-60 markets are extended short-term.


     

  • NYSI DAILY

    NYSI DAILY

    The McClellan Summation Index is a long-term version of the McClellan Oscillator. It is a market breadth indicator, and interpretation is similar to that of the McClellan Oscillator, except that it is more suited to major trends. I believe readings of +1000/-1000 reveal markets as much extended.


     

  • VIX WEEKLY

    VIX WEEKLY

    The VIX is a widely used measure of market risk and is often referred to as the "investor fear gauge". Our own interpretation is highlighted in the chart above. The VIX measures the level of put option activity over a 30-day period. Greater buying of put options (protection) causes the index to rise.


     

 

 

 

Closing Summary

Around 2 AM EDT we might know the official result of the Scottish referendum vote. If it’s a no vote there may be some unrest and a yes vote will create market unrest. Take your choice.

Friday is the Alibaba IPO and for most of us it will be a spectator show.

Further tomorrow is Quadwitching and Leading Indicators.

Let’s see what happens.

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...

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Dave Fry is founder and publisher of ETF Digest and has been covering U.S. and global ETFs since 2001.

He is the author of "Create Your own ETF Hedge Fund: A Do-It-Yourself Strategy for Private Wealth Management" published by Wiley Finance and "The Best ETFs: U.S. Equities, A Companion Guide to Building Your ETF Portfolio".



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Disclaimer: The charts and comments are only the author's view of market activity and aren't recommendations to buy or sell only any security. Market sectors and related ETF's are selected based on his opinion as to their importance in providing the viewer a comprehensive summary of market conditions for the featured period. Chart annotation's aren't predictive of any future market action rather they only demonstrate the author's opinion as to a range of possibilities going forward. More detailed information, including actionable alerts, are available to subscribers at www.etfdigest.com

 

ETF Digest

Market Summary
NYSE Composite Index S&P 500 Index Nasdaq Composite Index Russell 2000 Small Cap Index NYSE Composite Index S&P 500 Index Nasdaq Composite Index Russell 2000 Small Cap Index 10 Year Treasury Note Yield Gold Bugs Index Morgan Stanley High Tech 35 Index Market Chart
Commodity Quote Change Change % NY
Gold1,216.70-9.10-0.74 %14:05
WTI Crude Futr92.27-0.80-0.86 %13:29
Index Quotes Change Change % Local
CRB279.32-1.62-0.58 %13:47
US Dollar84.860.470.55 % 13:42
Index Quotes Change Change % Local
VIX12.530.504.16 % 13:28
MSCI Value Daily MTD YTD
Brazil2423.602-2.23 %-9.98 %9.26 %
Russia645.030-0.32 %-0.59 %-18.03 %
India514.4161.65 %1.21 % 26.30 %
China64.905-0.88 %-1.85 %2.86 %