Views From The Hill

View From The Hill: October-15-2015

Commentary and Performance

bulls-and-bearsFor the first three hours of trading, stock prices were relatively unchanged until the bulls charged into an intraday breakout without retreating. The S&P 500 surpassed key price resistance at 2020 and closed @ 2023.86 (+29.62 / +1.49%). The Nasdaq-100 made a new 20-day high @ 4418.22 (+71.30 / +1.64%) while the small-cap Russell-2000 failed to clear resistance at 1170 despite an impressive close @ 1162.77 (+25.80 / +2.27%).

Interest rate indexes for the 10 and 30 Year treasuries respectively rose to levels @ 20.23 (+0.42% / +2.21%) and 28.73 (+0.34 / +1.20%).

The US Dollar began the day in negative territory, but rallied to positive territory @ 94.44 (+0.48 / +0.51%). Supporting the dollar were a strong unemployment claims report and comments from one of the EU’s governing council members which implied that the region is far from a pillar of economic strength itself. From a technical perspective, the dollar is near a significant level of support that has been successfully tested at least 3 times since May 2014.

In commodities, the World Gold Index hit a new 4-month high @ 1183.00 (+3.20 / +0.27%) and has now closed in positive territory for 9 of the last 10 trading sessions. Meanwhile, the WTI Crude Oil Index retreated on news of much higher than expected oil supply inventories before recovering losses and finishing @ 46.86 (+0.22 / +0.47%).

In real estate assets, the Dow Jones Real Estate Index closed @ 291.98 (+3.66 / +1.27%) and the Dow Jones Home Construction Index ended the day @ 578.77 (+7.87 / +1.38%).

 

Daily Chart Analysis

sp-500_10-15-2015_daily
click to enlarge

 

Market Breadth

  • Advancers (2638) vs. Decliners (282).
  • New 5-day highs (669) significantly lagged the number of New 5-day lows (951)
  • New 52-week highs (157) also trailed new 52-week lows (75)
  • Bullish reversals (1042) lagged Bearish reversals (39)

 

Volume Radar Alerts

Stock prices increasing on high volume
  • Xerox Corp (XRX) @ 10.30 (+5.47%) on 545% volume surge
  • Wynn Resorts Ltd (WYNN) @ 73.76 (+1.92%) on 136% volume surge
  • Xilinx Inc. (XLNX) @ 46.27 (+0.89%) on 196% volume surge
  • Keycorp (KEY) @ 13.31 (+4.72%) on 120% volume surge
  • The Kroger Corp (KR) @ 37.07 (+2.04%) on 111% volume surge
Stock prices declining on high volume
  • Garmin Ltd (GRMN) @ 32.28 (-12.66%) on 544% volume surge
  • Seagate Tech Hldgs (STX) @ 41.44 (-13.31%) on 354% volume surge
  • HCA Holdings Inc. (HCA) @ 72.21 (-5.01%) on 345% volume surge
  • Wyndham Worldwide Corp (WYN) @ 74.14 (-3.95%) on 296% volume surge
  • Western Digital Corp (WDC) @ 81.12 (-2.49%) on 165% volume surge

 

Market Moving Events

Bullish

  • Central Banks / Federal Reserve / Interest Rates: Based upon a recently weaker economic data, speculation and rumors have emerged that the Federal Reserve will defer any interest rate increases until next year.
  • Central Banks / ECB / Quantitative Easing:¬†The ECB’s Governing Council member, Nowotny, has reversed his outlook from 3 weeks ago by admitting that the Eurozone is clearly missing its target on headline and core inflation, which is leading speculators to deduce further quantitative easing may be due.
  • China / Economic Policy / Telecom Industry: China’s government announced a $36bn plan to reorganize the country’s telecom industry and lead to anticipation of additional economic reforms within other industries in order to stimulate economic growth.
  • Employment / USA: Jobless Claims remain at historically low levels and for the week of Oct-10-2015 were much lower than expected @ 255k vs. consensus @ 270k and previous @ 262k. The 4-week moving average for this widely followed data also hit a 42-month low @ 265k.

Bearish

  • Economy / Manufacturing / USA: The Empire State Manufacturing Survey for October-2015 contracted a reading of -11.36 vs. consensus @ -7.0 and previous @ -14.67.
  • Economy / Business Sentiment / USA: The Philadelphia Fed Business Survey Outlook for October-2015 contracted to -4.5 vs. consensus @ -1.0 and previous @ -6.0.
  • Commodities / Energy / EIA Report: Weekly Crude Oil Inventories for October-9-2015 surged by 7.6mm barrels vs. estimates @ 2.8mm to reach a level of 469mm. The buildup is attributed to a decline in refinery demand and increase in oil imports.

Neutral

  • Economy / Consumer / USA: The Consumer Price Index for September-2015 fulfilled expectations which called for a -0.2% contraction mth/mth. Annually, it was flat¬† @ 0.0% vs. previous @ 0.2%.

 

Disclaimer

Hillbent does not provide individualized market advice. The information we publish regards securities in which we believe our readers may be interested and our reports reflect our sincere opinions. Nevertheless, they are not intended to be personalized recommendations to buy, hold, or sell securities. Investments in the securities markets, and especially in options, are speculative and involve substantial risk. Each individual investor should determine their respective appropriate level of risk. It is recommended that you seek personal advice from your professional investment advisor and conduct further independent due diligence research before acting on information published in any of our reports. Most of our information is derived directly from information published by the companies on which we report and/or from other sources we deem to be reliable, without our independent verification. Therefore, we cannot assure the completeness or accuracy of information contained within these reports and we do not in any way warrant or guarantee the success of any action which you take in reliance on our statements. Hillbent.com, Inc. or its affiliates may own positions in the equities mentioned in our reports. We do not receive any compensation from any of the companies covered in our reports.

 

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