With bulls putting together three back-to-back wins, a rally is in play. Santa’s early arrival has really stuffed it to the shorts . The flat Durable Goods report November-2015 (actual new orders @ 0.0%) had no bearing (pun unintended) on today’s session.
Had someone told me a month ago that Crude Oil would be leading this market, I would have suggested a psychiatric evaluation. The overall fundamentals for oil remain weak, but the bearish energy report that I and many others anticipated failed to materialize as the EIA reported a 5.9mm barrel drawdown vs. consensus forecasts @ 600k surplus. With WTI Crude up almost four percent, it was more than enough to lift the CRB Index to second place in performance. Both Gold and Bonds suffered from rising 10 and 30 year treasury rates. The Dollar barely budged and Real Estate assets delivered mixed results.
Stocks derived today’s positive performance primarily from the energy markets. All the major equity indexes in our performance universe were up. Leading sectors were Energy (XLE +4.35%) and Materials (XLB +2.36%). Telecom (IYX +2.18%) which continues to attract investors, was accompanied by Utilities (XLU +2.18%), There were no losers today, but Consumer Discretionary (XLY +0.51) (despite December-2015’s rising Consumer Sentiment Index @ 92.5 or November-2015’s solid Personal Income and Spending) and Information Technology (VGT +0.51%) significantly lagged.
Double-digit performances in individual stocks were noted among energy and materials companies, e.g. Freeport-McMoRan (FCX +16.04% on 101% volume surge), Williams Cos (WMB +12.27% on 166% volume surge), Devon Energy (DVN +11.30% on 70% volume surge). Another biotech also joined the volume radar list, i.e. Celgene (CELG +9.83% on 196% volume surge).
Consumer stocks produced some of today’s biggest losers as Bed Bath & Beyond (BBBY -4.58% on 241% volume surge) and Nike (NKE -2.38% on 520% volume surge) just couldn’t do it today.
No further comments…
*Trends: ST = short-term; MT = Intermediate-term; LT = long-term
The lack of higher volume for advancing issues is still somewhat bothersome but given that this is a seasonally slow time of the year, the market is being a given a pass and only too happy to take a win where and when it can. Most encouraging, however, was the SP-500’s clearing of resistance @ 2060, closing above its 50 day moving average and crossing into positive momentum territory for the 20 and 50 day averages.
The next walls of worry for the market to surmount are the existing downtrend line which bears (again no pun intended) upon it and resistance @ 2076-2080. Support is @ 2045-2040 levels.
Hillbent on the Market Direction…
|Daily Chart Technical Analysis|
|New 5-day highs||202||New 5-day lows||13|
|New 52-week highs||15||New 52-week lows||23|
|Bullish reversals||15||Bearish reversals||22|
|% > 20 M.A.||% > 50 M.A.||% > 100 M.A.||% > 200 M.A.|
|57% ↑||52% ↑
|↑ = positive momentum; ↓ = negative momentum; and ↔ = neutral momentum|
Volume Radar Alerts
- Vol % = volume percentage greater than average volume
- SIR = short interest ratio or days to cover
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