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Stock Market Today: Heading Higher into Stocks' Biggest Month

By , Money Morning -

Stock Market News Today, Nov. 27: U.S. stock futures today are headed for yet another record-breaking session as stocks are up across the board ahead of tomorrow's holiday.

The Standard & Poor's 500 is up about 0.3% at 1,807 points and the Dow Jones Industrial Average is up 0.2% to 16,101 points. The Nasdaq Composite Index is up 0.5%, marking a high of 4,039 today.

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Four Factors to Consider Before Determining Your Long-Term View on U.S. Stocks

By , Contributing Writer, Money Morning -

Stocks rose worldwide over the past week -- ranging from +2% in U.S. big caps to +6% in gold -- as investors swelled with sudden courage in response to positive reports on Chinese economy and glimmers of hope that European governments can get their financial houses in order.  

The week's results erased four weeks of losses, including the despairing session that ensued on June 7 after a disappointing report on U.S. employment.  Meanwhile, the result of the past 35 trading days, or seven calendar weeks, are still largely negative, ranging from a loss of 5.5% for U.S. stocks and -8.5% for Europe. Only gold stocks have eluded the smoke monster, rising 7% in the span.

The variation in one-week and one-month results illustrate perfectly how investors are showing that they are hopeful but unconvinced that recent strength in gross domestic product (GDP) growth and corporate income advances are sustainable, and therefore won't buy stocks heavily until prices are so cheap that they discount worst-case scenarios. In other words, they want a high risk premium before buying -- sort of like demanding a 72-month warranty before buying an expensive car.

To read about the four factors you should consider before investing click here.

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The Real Story Behind Last Week's Stock-Market Panic

By , Contributing Writer, Money Morning -

Thursday's U.S. stock market trading session qualified as a genuine stock-market "panic." They're rare, fortunately, so they're memorable.

You can say you were there.

According to the volume analysts at Lowry Research Corp., this stock market panic was on par with the mini crash of October 1989, when the Dow Jones Industrial Average plunged 6.9% in a single day. But it wasn't on par with the famed session of October 1987, when the Dow plunged 22.6% in a day.



For an in-depth analysis of last week's U.S. stock market panic, please read on...

Bulls Overcome Market Tug of War to Send Stocks off to Strong March Start

By , Contributing Writer, Money Morning -

Stocks rose briskly last week, resulting in a big week for the major market indexes. Weekly and monthly index charts improved, and such major U.S. stocks as The Boeing Co. (NYSE: BA), Hewlett Packard Co. (NYSE: HPQ), American Express Co. (NYSE: AXP), Google Inc. (NASDAQ: GOOG), Apple Inc. (AAPL), Goldman Sachs Group Inc. (NYSE: GS) and General Electric Co. (NYSE: GE) emerged from flat-lining or faltering price patterns on decent, if not outstanding, volume.

Just two weeks ago, every one of the afore-mentioned stocks looked terrible, exhibiting intense apathy amid slow, grinding declines. Then the skies parted, and suddenly the sun is shining on these shares once again.

That's why U.S. stocks are off to a strong March start - already up 4.1% from the end of February. And don't forget, a year ago at about this time (March 9, 2009), the market reached its nadir: The Standard & Poor's 500 Index is up 69.98% since that time.

Here's why the shift seems so abrupt. The markets are now in a tug of war between two forces:

  • On the plus side are good fourth-quarter earnings reports related to an improving economy.
  • On the negative side - as a friend at a major macro hedge fund described it last week - are "frigid winds blowing across the credit icebergs."
To find out who’s winning the stock-market tug of war,

please read on…

Which Sector Will Step Up and Lead Bulls in 2010?

By , Contributing Writer, Money Morning -

Digging beneath the surface of the late 2009 market for clues, we find that some measures of breadth continue to deteriorate even as the major indices continue to float near their highs. For example, the percentage of stocks above their 10-day moving average has gone from 81% on Christmas Eve to 71% now. This is an indication that buyers have become more selective.

This adds to a trend that's been developing over the last few months. While the NASDAQ has managed an impressive breakout from its multi-month trading range, it's doing this on the back of fewer and fewer stocks based on the number that are over their 50-day moving average. Part of the problem is the lack of clear market leadership.

One of the reasons that the bull cycle of the past year has been so strong is that it had a rotating cast of leaders: First banks, then retailers, then tech, then energy, then materials, and so on.

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U.S. Stocks Will Reward Optimistic Investors in 2010

By , Contributing Writer, Money Morning -

I have been surprised to see the air thick with pessimism in recent weeks. Not so much the stock market, where the sentiment indexes show the bulls dominating the bears by slightly more than 52%. But among the general public.

An NBC/Wall Street Journal poll last week found that 55% of all Americans feel the nation is heading the wrong direction. This is the highest level since January of this year - when the financial crisis was red hot and U.S. President Barack Obama was just entering the White House! That's amazing.

A recent CNBC "Wealth in America" report found more negativity. Negative sentiments were expressed about the economy, stocks, home values, and wage growth. Faith in institutions like the U.S. Federal Reserve, the U.S. Treasury, and the financial sector were very low. President Obama's approval rating has fallen below 50% for the first time.

However, Merrill Lynch & Co. Inc. researchers picked up on this theme, and said in a recent note to clients that 2010 would be the year we exit the "pessimism bubble."

And I couldn't agree more. In fact, there might not be a better time to buy stocks.

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How to Profit From the "Evil Genius" of Goldman Sachs

By , Contributing Writer, Money Morning -

When references are made to the world's "oldest profession," I sometimes wonder if we're not exactly referring to market manipulation. In this country alone, market operators have been employing all sorts of market manipulations for more than 100 years.

What may surprise you is that most of it isn't illegal or even improper; in institutional circles, it's actually viewed as shrewd business.

One such manipulation was put on display this week - a news development that had me howling in disbelief and left me in awe of the evil genius of Goldman Sachs Group Inc. (NYSE: GS).

But if we step back, there's a lesson here - a lesson that points to real potential profits if we stop to understand what's about to happen before our very eyes. It's a lesson that I preach to investors - that the institutions that operate the market and maintain its very framework, also "influence" that market's movements. In fact, this real-market "case study" confirms the profit strategy that I've set out in this special report.

These machinations are completely legal. But they do happen and those who understand that also have the opportunity to profit from that knowledge. And you don't even have to be part of the institutional elite to do so if you know what to look for.

Let me explain...

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Is Tech Leading the Recovery?

By , Money Morning -

Better-than-expected results from bellwether Intel Corp. (Nasdaq: INTC) are lending credence to the notion that technology - fueled by consumer spending - is leading the recovery. The tech-laden Nasdaq Composite Index is the only major stock index to post a gain over the past five years, rising more than 13% as the Standard & Poor's […]

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Here's Why the U.S. Rebound Will Be Stronger Than You Thinkcom

By , Contributing Writer, Money Morning -

The U.S. economy may be experiencing a "V-shaped" economic rebound. But it's not the conventional V-shaped rebound - where the two sides are about even. We may actually be looking at an extended rebound in which the right (recovery) side of the "V" extends way up high, like a checkmark. Since that is way out […]

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Upbeat Earnings Will Fuel the Bull Market's Next Leg

By , Contributing Writer, Money Morning -

When it comes to the health of the U.S. stock market over the next few weeks, corporate earnings will tell the story. Alcoa Inc. (NYSE: AA) kicks off the third-quarter earnings season on Wednesday. My guess is that over the next few weeks, as third-quarter earnings are reported, we will have the opportunity to witness […]

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Flurry of Mergers and Acquisitions Drives Stock Market Rally

By , Contributing Writer, Money Morning -

A flurry of mergers-and-acquisition deals in the pharmaceutical and technology industries today (Monday) sparked a sharp market rally, snapping a three-day losing streak and giving stocks to their biggest gains in five weeks. The pickup in merger activity bolstered arguments that mergers and acquisitions (M&A) are rebounding from the biggest slump in six years. It […]

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Long-Term Stock-Market Uptrend to Continue

By , Contributing Writer, Money Morning -

Stocks moved lower for the third consecutive day on Friday, something that hasn't happened in more than three weeks, as the bulls just couldn't capitalize on a short-term overbought condition. Measures of selling pressure eased as the bears rested their knuckles after a two-day pummeling. Investors are worried. The big question – as always – […]

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High-Quality Stocks Ready to Take the Lead in the U.S. Market

By , Contributing Writer, Money Morning -

With the major U.S. stock market indices trading at recent highs, there is new evidence that the most recent phase of the advance was fueled by the lowest-quality stocks. But now it looks like higher-quality companies may be ready to take the lead: These shares will emerge from their slumber, causing the Standard & Poor’s […]

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U.S. Stocks: Winning Streak is Over, But Bull Market Continues

By , Contributing Writer, Money Morning -

The winning streak is over. But the outlook for stocks remains upbeat. U.S. stocks on Friday suffered their first setback after six straight days of gains, but the damage wasn't severe. No news appeared to precipitate the decline, so chalk it up to light profit-taking. In the Friday session, the Dow Jones Industrial Average lost […]

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