Daily Investment Interpretations

November 17, 2011

2011-11-17: (Thursday Night): It was another bad day at Black Rock: Stocks take a beating again, U.S. stocks thrown again by Europe, Stocks Languish On Credit Fears. The NASDAQ Composite tumbled 51.62 points (-1.96%) to close at 2,587.99. The Dow slid 134.86 points (-1.13%) to 11,770.73; the S&P 500 declined another 20.78 points (-1.68%) to settle at 1,216.13. Oil backed down to 98.77: Oil back at century mark; gold dropped $18 to 1,764: Gold's the only euro-crisis winner: Lynn. The VIX gained 1 point to 34.51.
    Here's what State of the Markets has to say about today's action (
Stocks Languish On Credit Fears): 
    "The bulls tried to put up a fight early on, following a number of better than expected U.S. economic reports (Weekly Jobless Claims, Housing Starts, Building Permits, and Bloomberg Consumer Comfort Index). However, concerns of credit deterioration in Europe, apprehension over the Congressional super-committee, and eventually technical selling sent stocks plummeting in the late afternoon. The S&P 500 fell straight through support at 1220 and would not reach that level again.
    "This stock market is volatile, sensitive, and sometimes, irrational. Today we saw some triggered selling from 1230-1215 (took about 8 minutes), though we did close a bit higher than the intraday lows (~1210). Friday’s action will be important to watch, as any movement much lower and we could flush right back down into the August range.
    Anyone who trades today's stock market using past investment rules of thumb just  doesn't get it: we're in the first liquidity trap since the Great Depression. The Fed no longer controls the economy through monetary adjustments of interest rates. It was the Fed's adjustment of interest rates that inspired our previous post-war rules of thumb... or at least, my own investment guidelines. But the Fed is at the "zero lower bound".
    The Deficit Super-Committee is supposed to issue its recommendations next Wednesday.
    Jobless claims fall to lowest level since April    
    Philly Fed gauge unexpectedly turns lower  
    Spanish yields surge to euro-era highs  
    French debt's also growing more costly  
    What gives with economy? "The U.S. faces a lower threat of another recession. Yet hardly any economist predicts a full recovery."  
    Trade like a congressman, Mick Weinstein says  
    David Weidner argues that Bloomberg's bum rush backfires. Mr. Weidner's thesis is that the Occupy Wall Street movement was getting a bit stale and was losing media coverage. By forcibly evicting the demonstrators by night and arresting 200 protestors, Mayor Bloomberg revitalized the movement: Protesters in L.A. clogs streets and freeways, Violence Escalates at 'Occupy' Protests in NYC, as Crowd Eyes March on , Protesters march nationwide; over 200 arrested,   

   State of the Markets' articles include: 
    Technical Talk: On the Verge Of A Breakdown This is discussed in the after-market article above.  
    Housing Starts and Building Permits Above Expectations 
    Business As Usual on Wall Street  
    Fitch Back In News: Says Interventions Likely in Europe
    Bloomberg Consumer Comfort Index Improves

    Market futures are essentially neutral tonight.