Bulls Take a Day Off: Dave's Daily
The same can't be said for the energy and most precious metals as Bernanke gives the complex the green light. The Fed wants to reflate and if that's what they want, traders will accommodate them. You want to pay more for energy don't you? Thankfully it's not in the phony CPI because authorities want you to pretend you neither use heating oil, gasoline or even food for that matter. They've reconfigured the CPI more times than congress votes on a new debt ceiling. And, they do this to deceive but also to lower entitlement spending. Imagine all those government workers on COLAs and Social Security recipients who just stare at their heating and electric bills in disbelief. What's a nice T-bone cost nowadays anyway? It's the dropping price of tech toys and quality improvements they focus on that matters now.
Economic data was mostly disappointing versus estimates. Jobless Claims were up more than expected (377K vs 370 exp. & prior revised higher as usual to 356K); Durable Goods Orders also missed (+.3% vs +2.2% exp. & prior 4.3%); Leading Indicators missed (+.4% vs +.7% exp. & prior +.5%); and, New Home Sales also disappointed (307K vs 320K exp. & prior 314K prior).
On the earnings front 3M (MMM) another price heavyweight in the price-weighted DJIA beat expectations although falling short on the revenue side. AT&T, a DJIA component lightweight, disappointed as pension costs negatively affected earnings as did its takeover attempt of T-Mobile.
Stocks sold-off modestly as the trading day wore on. Bulls took a break from all the excitement during the previous few days of trading. Friday is the last day of January and some window-dressing is possible but it won't take much effort as the month's performance was excellent.
Volume was better overall but still light based on previous averages while breath per the WJS was mildly negative.
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SPY - The SPDR® S&P 500® ETF is a fund that, before expenses, generally corresponds to the price and yield performance of the S&P 500 Index. Our approach is designed to provide portfolios with low portfolio turnover, accurate tracking, and lower costs.
IWM - The iShares Russell 2000 Index Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the small capitalization sector of the U.S. equity market as represented by the Russell 2000 Index. The index represents the approximately 2,000 smallest companies in the Russell 3000 Index.
QQQ - is an exchange-traded fund based on the Nasdaq-100 Index
®
. The Fund will, under most circumstances, consists of all of stocks in the Index. The Index includes 100 of the largest domestic and international nonfinancial companies listed on the
Nasdaq
Stock Market based on market capitalization. The portfolio is rebalanced quarterly and reconstituted annually.
See more details
Continue to U.S. Sector, Stocks & Bond ETFs
XLK - The Technology Select Sector SPDR® Fund, before expenses, seeks to closely match the returns and characteristics of the Technology Select Sector Index (ticker: IXT). Our approach is designed to provide portfolios with low portfolio turnover, accurate tracking, and lower costs.
XLI - The Industrial Select Sector SPDR® Fund, before expenses, seeks to closely match the returns and characteristics of the Industrial Select Sector Index. Our approach is designed to provide portfolios with low portfolio turnover, accurate tracking, and lower costs.
XLB - The Materials Select Sector SPDR® Fund, before expenses, seeks to closely match the returns and characteristics of the Materials Select Sector Index. Our approach is designed to provide portfolios with low portfolio turnover, accurate tracking, and lower costs.
XRT - The SPDR® S&P® Retail ETF seeks to replicate as closely as possible, before expenses, the total return performance of the S&P Retail Select Industry® Index. Our approach is designed to provide portfolios with low portfolio turnover, accurate tracking, and lower costs.
XLY - The Consumer Discretionary Select Sector SPDR® Fund, before expenses, seeks to closely match the returns and characteristics of the Consumer Discretionary Select Sector Index. Our approach is designed to provide portfolios with low portfolio turnover, accurate tracking, and lower costs.
ITB - The iShares Dow Jones U.S. Home Construction Index Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Dow Jones U.S. Select Home Construction Index.
XLF - The Financial Select Sector SPDR® Fund, before expenses, seeks to closely match the returns and characteristics of the Financial Select Sector Index. Our approach is designed to provide portfolios with low portfolio turnover, accurate tracking, and lower costs.
IYT - The
iShares
Dow Jones Transportation Average Index Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of Dow Jones Transportation Average Index.
XLU - The Utilities Select Sector SPDR® Fund, before expenses, seeks to closely match the returns and characteristics of the Utilities Select Sector Index. Our approach is designed to provide portfolios with low portfolio turnover, accurate tracking, and lower costs.
IEF - The
iShares
Barclays 7-10 Year Treasury Bond Fund seeks to approximate the total rate of return of the intermediate-term sector of the United States Treasury market as defined by the Barclays Capital U.S. 7-10 Year Treasury Bond Index.
MBB - The iShares Barclays MBS Bond Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the investment grade agency mortgage-backed securities sector of the United States as defined by the Barclays Capital U.S. MBS Index.
Continue to Currency & Commodity Market ETFs
UUP - The
PowerShares
DB US Dollar Bullish Fund (Symbol: UUP) is based on the Deutsche Bank Long US Dollar Index (USDX®) Futures Index¿ (DB Long USD Futures Index). The Index, which is managed by DB Commodity Services LLC, is a rules-based index composed solely of long USDX® futures contracts. The USDX® futures contract is designed to replicate the performance of being long the US Dollar against the following currencies: Euro, Japanese Yen, British Pound, Canadian Dollar, Swedish
Krona
and Swiss Franc.
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FXE -
CurrencyShares
Euro Trust is designed to track the price of the euro net of Trust expenses, which are expected to be paid from interest earned on the deposited
euros
.
GLD - The objective of the SPDR® Gold Trust¿ is for the Shares to reflect the performance of the price of gold bullion, less the Trust's expenses.
GDX - The Gold Miners ETF seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the NYSE
Arca
Gold Miners Index. The Index provides exposure to publicly traded companies worldwide involved primarily in the mining for gold, representing a diversified blend of small-, mid- and large- capitalization stocks. As such, the Fund is subject to the risks of investing in this sector.
SLV - The objective of the
iShares
Silver Trust is for the value of the shares of the
iShares
Silver Trust to reflect, at any given time, the price of silver owned by the
iShares
Silver Trust at that time, less the
iShares
Silver Trust's expenses and liabilities.
DJP - The
iPath
® Dow Jones-UBS Commodity Index Total
ReturnService
Mark ETN is linked to the Dow Jones-UBS Commodity Index Total
ReturnService
Mark and reflects the returns that are potentially available through an unleveraged investment in the futures contracts on physical commodities comprising the index plus the rate of interest that could be earned on cash collateral invested in specified Treasury Bills. The commodities represented in the Dow Jones-UBS Commodity Index Total
ReturnService
Mark are rebalanced annually; however, the weightings fluctuate between
rebalancings
due to changes in market prices.
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DBB - The
PowerShares
DB Base Metals Fund (Fund) is based on the Deutsche Bank Liquid Commodity Index - Optimum Yield Industrial Metals Excess Return¿ (Index) and managed by DB Commodity Services LLC. The Index is a rules-based index composed of futures contracts on some of the most liquid and widely used base metals - aluminum, zinc and copper (grade A). The index is intended to reflect the performance of the industrial metals sector. You cannot invest directly in an index. Ordinary brokerage commissions apply.
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JJC - The Dow Jones-UBS Copper
Subindex
Total
ReturnService
Mark is a sub-index of the Dow Jones-UBS Commodity Index Total
ReturnService
Mark and reflects the returns that are potentially available through an unleveraged investment in the futures contracts on physical commodities comprising the index plus the rate of interest that could be earned on cash collateral invested in specified Treasury Bills.
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USO - The United States Oil Fund, LP ("USO") is a domestic exchange traded security designed to track the movements of light, sweet crude oil ("West Texas Intermediate").
UGA - The United States Gasoline Fund LP (UGA) is an exchange traded security that is designed to track in percentage terms the movements of gasoline prices.
UNG - The United States Natural Gas Fund LP (UNG) is an exchange traded security that is designed to track in percentage terms the movements of natural gas prices.
XLE - The Energy Select Sector SPDR® Fund, before expenses, seeks to closely match the returns and characteristics of the Energy Select Sector Index. Our approach is designed to provide portfolios with low portfolio turnover, accurate tracking, and lower costs.
DBA - The PowerShares DB Agriculture Fund is based on the Deutsche Bank Liquid Commodity Index Diversified Agriculture Excess Return¿ and managed by DB Commodity Services LLC. The Index is a rules-based index composed of futures contracts on some of the most liquid and widely traded agricultural commodities. The Index is intended to reflect the performance of the agricultural sector.
See more details
JJG - The Dow Jones-UBS Grains
Subindex
Total
ReturnService
Mark is a sub-index of the Dow Jones-UBS Commodity Index Total
ReturnService
Mark and reflects the returns that are potentially available through an unleveraged investment in the futures contracts on physical commodities comprising the Index plus the rate of interest that could be earned on cash collateral invested in specified Treasury Bills. The Index is currently composed of three futures contracts on grains traded on U.S. exchanges.
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Continue to Overseas Sectors & ETFs
EFA - The
iShares
MSCI EAFE Index Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of publicly traded securities in the European, Australasian and Far Eastern markets, as measured by the MSCI EAFE Index.
EEM - The
iShares
MSCI Emerging Markets Index Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of publicly traded securities in emerging markets, as represented by the MSCI Emerging Markets Index.
EWJ - The
iShares
MSCI Japan Index Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of publicly traded securities in the Japanese market, as measured by the MSCI Japan Index.
EWU - The
iShares
MSCI United Kingdom Index Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of publicly traded securities in the British market, as measured by the MSCI United Kingdom Index.
EWG - The
iShares
MSCI Germany Index Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of publicly traded securities in the German market, as measured by the MSCI Germany Index.
EWT - The iShares MSCI Taiwan Index Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of publicly traded securities in the Taiwanese market, as measured by the MSCI Taiwan Index.
EWA - The iShares MSCI Taiwan Index Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of publicly traded securities in the Taiwanese market, as measured by the MSCI Taiwan Index.
EWZ - The
iShares
MSCI Brazil Index Fund seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of publicly traded securities in the Brazilian market, as measured by the MSCI Brazil Index.
RSX - The Russia ETF seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the
DAXglobal
® Russia+ Index. The Index provides exposure to publicly traded companies that are domiciled in Russia, and traded in Russia and/or on leading global exchanges. As such, the Fund is subject to the risks of investing in this country.
EPI -
WisdomTree
India Earnings Fund seeks investment results that correspond to the price and yield performance, before fees and expenses, of the
WisdomTree
India Earnings Index.
GXC - The SPDR® S&P® China ETF, before expenses, seeks to closely match the returns and characteristics of the total return performance of the S&P China BMI Index. Our approach is designed to provide portfolios with low portfolio turnover, accurate tracking, and lower costs.
The
NYMO
is a market breadth indicator that is based on the difference between the number of advancing and declining issues on the NYSE. When readings are +60/-60 markets are extended short-term.
The
McClellan Summation Index
is a long-term version of the McClellan Oscillator. It is a market breadth indicator, and interpretation is similar to that of the McClellan Oscillator, except that it is more suited to major trends. I believe readings of +1000/-1000 reveal markets as much extended.
The
VIX
is a widely used measure of market risk and is often referred to as the "investor fear gauge". Our own interpretation is highlighted in the chart above. The VIX measures the level of put option activity over a 30-day period. Greater buying of put options (protection) causes the index to rise.
Continue to Concluding Remarks
We're about to wrap up an excellent month of January featuring little volume and plenty of head scratching as retail investors anyway are only in equities if they have to be. For us we have high cash balances and a bad attitude overall. But as the old saying goes, "the thing you know best is what you like least" is probably in play.
Earnings have been just okay away from Apple. There are plenty more reports yet to come over the next two weeks especially. Economic data has been just okay as well reflecting the low rate of general economic growth overall.
Let's see what happens.
Disclaimer: The ETF Digest maintains active ETF trading portfolio and a wide selection of ETFs away from portfolios in an independent listing. Current positions if any are embedded within charts. Active Portfolios: No Positions. Our Lazy & Hedged Lazy Portfolios maintain the follow positions: QQQ, XLK, XLY, MBB, VT, MGV, BND, BSV, VGT, VWO, VNO, IAU, DJCI, DJP, VMBS, VIG, ILF, EWA, IEV, EWC, EWJ, EWG, & EWU.
The charts and comments are only the author's view of market activity and aren't recommendations to buy or sell any security. Market sectors and related ETFs are selected based on his opinion as to their importance in providing the viewer a comprehensive summary of market conditions for the featured period. Chart annotations aren't predictive of any future market action rather they only demonstrate the author's opinion as to a range of possibilities going forward. More detailed information, including actionable alerts, are available to subscribers at
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This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.
Dave Fry is founder and publisher of
, Dave's Daily blog and the best-selling book author of
Create Your Own ETF Hedge Fund, A DIY Strategy for Private Wealth Management
, published by Wiley Finance in 2008. A detailed bio is here:
Dave Fry.
