Saturday, December 23, 2006
Sourness Sets In
The Markets ended the week on a sour note with the major market indices all falling. The Dow ended the session with a loss of 78.03 points to close at 12,343.22. The SPX declined 7.54 points to 1,410.76. Our play is in green and our risk to this position is already looking once again to the down side.
Economic news was again the story on Friday with three reports all garnering attention. Durable goods orders was a mixed bag with the headline figure rising 1.9 percent in November after a sharp drop of more than 8 percent in October. However, nondefense orders excluding aircraft, a proxy for business investment, saw a 1.4 percent decline during the month.
The University of Michigan consumer sentiment survey fell back slightly to 91.7, although this was higher than the 91.0 reading expected. There have been mixed readings on sentiment and consumer spending of late, something that has analysts unsure of how strong the holiday shopping season will be in the US.
Speaking of consumer spending, this component of the personal income and outlays report rose 0.5 percent, a tenth below estimates. Personal incomes were also a tenth lower than expected at growth of 0.3 percent. The biggest news within this report was the flat reading for the core PCE deflator. This is a major part of the Fed’s inflation gauge and though this indicator is up 2.2 percent this past year, it has been moving in the right direction.
Historically the week between Christmas and New Year past has been bullish. Lets hope so. A 15 point move up next week would be the best present we can hope for.
Finally, only thing left for me to do is to wish you all a very happy Christmas.
Until next time.
Economic news was again the story on Friday with three reports all garnering attention. Durable goods orders was a mixed bag with the headline figure rising 1.9 percent in November after a sharp drop of more than 8 percent in October. However, nondefense orders excluding aircraft, a proxy for business investment, saw a 1.4 percent decline during the month.
The University of Michigan consumer sentiment survey fell back slightly to 91.7, although this was higher than the 91.0 reading expected. There have been mixed readings on sentiment and consumer spending of late, something that has analysts unsure of how strong the holiday shopping season will be in the US.
Speaking of consumer spending, this component of the personal income and outlays report rose 0.5 percent, a tenth below estimates. Personal incomes were also a tenth lower than expected at growth of 0.3 percent. The biggest news within this report was the flat reading for the core PCE deflator. This is a major part of the Fed’s inflation gauge and though this indicator is up 2.2 percent this past year, it has been moving in the right direction.
Historically the week between Christmas and New Year past has been bullish. Lets hope so. A 15 point move up next week would be the best present we can hope for.
Finally, only thing left for me to do is to wish you all a very happy Christmas.
Until next time.
# posted by Paul @ 1:16 PM 
