Daily Investment Interpretations

October 24, 2011

2011-10-24: (Monday Night): Once more, the equity markets have soared: Brighter world for stocks, Stocks get merger, earnings boost, and Sentiment Improves; Bulls RollThe NASDAQ Composite added 61.98 points (2.35%) to close at 2,699.44: Nasdaq breaks through 200-day average. The Dow annexed 104.83 points (0.89%) to 11,913.62; the S&P 500 gained 15.94 points (1.29%) to settle at 1,254.19. Oil leaped to 91.79; gold climbed to 1,655. The VIX fell 2.06 points to 29.26.
    By now, the markets are quite overbought, so the conventional wisdom is that it would be wise to wait for a retest of the 1225 level on the S&P 500. The problem with this is that this strategy is obvious to traders so it may not happen, or at least, it may test the convictions of seasoned traders before it happens. One key idea, though, is that while the S&P 500 might rise over the next few days, it's climbed 150 points over the past three weeks. There are 40 trading days in November and December. I doubt that the S&P 500 will rise more than another 150 points between now and year's-end. That means there will be some backing and filling between now and the end of the year. The rise won't be as rapid as it has been lately.

    State of the Markets' Curt Bergquist presents his thoughts on where things are going over the next year: In My Opinion: Some Thoughts On The Grand Plan. And additional State of the Markets articles include:
    Technical Talk: The Most Bullish Thing a Market Can Do
    The Never-Ending Mystery of Earnings Season and Other Apple Matters    
    New Industrial Orders In Eurozone Continue Decline But Above Consensus    
    Obama To Announce Mortgage-Refinance Program  
    China's Flash PMI Improves; Suggests Soft Landing Ahead  
    Fed's Dudley: FOMC Will Do Everything In Its Power  
    Chicago Fed National Activity Index Shows Improvement  

    Meanwhile, back at Marketwatch:
    China’s economy may face hard landing
    Paul Farrell writes: EU bank failures will crash Wall Street again.
    Market gains flummox forecasters  
    Beijing talks tough on European debt 
      
    Market futures are slightly lower tonight.