Daily Investment Interpretations

October 18, 2011

2011-10-18: (Tuesday Night): The equity markets closed sharply higher today:  Stocks stage late day rally on hopes for Europe, France and Germany Agree to Leverage EFSF to 2 Trillion EurosThe NASDAQ Composite rose  42.51 points (1.63%) to close at 2,657.43. The Dow dropped 180.05 points (1.58%) to 11,577.05; the S&P 500 gained  24.52 points (2.04%) to settle at 1,225.38. Oil moved up to 88.44; gold fell to 1,665. The VIX retrenched 1.83 points to 31.56.
   
The markets closed above the tops of their trading ranges again today, and on higher volume than we've seen since this rally began. But after the close came this article, No deal to boost European bailout fund: report, claiming that "Reports that Germany and France have agreed to raise the European Financial Stability Facility to 2 trillion euros are 'totally wrong,'". Also, Apple's earnings have disappointed, and the after-hours news is generally unfavorable.

    State of the Markets articles include:
    Technical Talk: The End of The One-Way Streets?
    Fakeout #4?  
    Here's Hoping It's The Beginning Of The End
    Bank of America Earnings Disappoint  
    Coca-Cola Earnings Ahead of Consensus But  
    Goldman Sachs Posts a Larger-Than Expected Loss  
    Moody's Warns of Possible Downgrade for France  
    PPI Report Shows Inflation Hotter Than Expected in September  
    EU Officials Say EFSF Size Can Be Leveraged 3X to 5X  
    NAHB Homebuilder Confidence Index Sees Improvement  
    Merkel Says Greece Plan Will Be Decided On At EU Summit  

    Mark Hulbert reports that an Indicator with great record turns bullish. The indicator in question is the High Low Logic Index which now "stands solidly in bullish territory".  
    Kevin Marder tells us that this Market rally lacks conviction. His analysis is based upon yesterday's close.  
    U.S. wholesale prices leap 0.8% in September, mostly because of energy and food. (The core inflation rate rose 0.2%.) 
    Builder confidence boost  
    S&P 500, Nasdaq maintain first support
    Moody's downgrades Spain on growth slowdown  
    Apple shares fall as earnings miss expectations 
    All in all, the after-hours news isn't good, and tomorrow's market futures are somewhat lower.