Monday Aug 11th 2014 – Stocks Advance Again Despite Geopolitical Worries
Market View:
I like the look of this bounce and I hope it will continue up from here. I am cautiously invested here but happy to see the rhetoric from Russia come down a tad in the last couple of days.
There are not a lot of key reports out this week, but there will be a couple of fed speakers talking. Volatility is coming from either the Russian/Ukranian crisis or the possibility of the Fed giving hints of a rise in interest rates any time soon. Should both of these fears subside for a while longer, we will almost certainly be reaching for a new all-time high before the end of my vacation.
This will be my last blog post for a couple of weeks as I head to the cottage for a nice relaxing summer vacation. Next blog post will be Monday 25th August.
Market News:
U.S. stocks pared gains in light volume trading on Monday as investors looked for signs of easing in geopolitical tensions.
Trading across all platforms of the New York Stock Exchange at 2:40 p.m. ET was 1.9 billion, short of the 3.1 billion average.
Earlier in the day, Russian President Vladimir Putin said his country is coordinating with the International Red Cross to send humanitarian aid to Ukraine, the Kremlin stated.
Over in Gaza, Israel and the Palestinians agreed on Sunday to an Egyptian proposal for a new 72-hour ceasefire. President Barack Obama said on Saturday that U.S. airstrikes had already destroyed arms that Islamic State militants could have used against Iraqi Kurds. He did warn, however, that there would be no “quick fix” to the crisis.
Over 85 percent of S&P 500 firms have now reported their second-quarter results. So far, the earnings-per-share (EPS) beat:miss ratio is running at a pretty solid rate of around 3:1, according to Deutsche Bank. The ratio is lower for sales revenue, with just short of two-thirds of firms exceeding consensus estimates.
A break from economic reports on Monday will put focus on data releases from Tuesday onward, with the monthly budget and JOLTs jobs series.
Equities were also given a boost by Stanley Fischer, the vice chairman of the U.S. Federal Reserve, who said early on Monday that the recoveries in the U.S. and global economies had been “disappointing” thus far, indicating the Fed may not imminently tighten its monetary policy.
On tap this week:
Tuesday
Earnings: Bob Evans, Fossil, JDS Uniphase, Valspar, Flowers Foods, Cree
7:00 a.m.: NFIB small business survey
10:00 a.m.: JOLTs
1:00 p.m.: 3-year note auction
2:00 p.m.: Budget
Wednesday
Earnings: Deere, Macy’s, Cisco, SeaWorld, NetApp, Noodles, Surgical Care Affiliates, Iamgold
7:00 a.m.: Mortgage applications
8:30 a.m.: Retail sales
0905 a.m.: New York Fed President William Dudley
9:20 a.m.: Boston Fed President Eric Rosengren
10:00 a.m.: Business inventories
1:00 p.m.: 10-year note auction
Thursday
Earnings: Wal-Mart, Nordstrom, J C Penney, Kohl’s, Red Robin Gourmet, Advance Auto Parts, Agilent
8:30 a.m.: Jobless claims
8:30 a.m.: Import prices
1:00 p.m.: 30-year bond auction
Friday
Earnings: Estee Lauder
8:30 a.m.: PPI
8:30 a.m.: Empire manufacturing survey
9:00 a.m.: TIC data
9:15 a.m.: Industrial production
9:15 a.m.: Capacity utilization
9:55 a.m.: University of Michigan consumer sentiment