January 24, 2013 at 09:29 AM EST
Six Situations Investors Should Be Aware of Today!
Thursday, January 24, 9:25 a.m. 1. The jobs picture continues to improve. New weekly unemployment claims fell 5,000 last week to 330,000, the lowest level since January, 2008. The four-week moving average fell by 8,250 to 351,750, the lowest level since March, 2008. 2. The U.S. PMI Mfg Index jumped to 56.1 in January from [...]

Thursday, January 24, 9:25 a.m.

1. The jobs picture continues to improve. New weekly unemployment claims fell 5,000 last week to 330,000, the lowest level since January, 2008. The four-week moving average fell by 8,250 to 351,750, the lowest level since March, 2008.

2. The U.S. PMI Mfg Index jumped to 56.1 in January from 54.0 in January, indicating faster expansion than analysts expected. The consensus forecast was for a slight decline to 53.0.

3. China’s economy continues to improve. China’s HSBC PMI Mfg Index ticked up from 51.5 in December to 51.9 in January, a 24-month high.

4. However, the overall euro-zone PMI improved some, from 47.2 in December to 48.2 in January, but remained in the recession zone beneath 50.

5. It was wonderful for the market when Apple shares were soaring, with Apple’s heavy weighting accounting for so much of the gains in some of the Indexes. But with Apple plunging back down the chickens are coming home to roost. After reporting disappointing earnings yesterday, Apple shares are down another 8% in pre-open trading, which has Nasdaq futures down 1.3%. Analysts who had targets of $1,000 for Apple for this year are scrambling to get them out of sight. Apple, as of yesterday’s close:

 012413a

6. We remain on the intermediate-term sell signal for gold (intermediate-term technical indicators not shown in chart).

012413b

After gold topped out from its previous rally it moved into a symmetrical triangle formation. The direction of the break-out from such a formation usually determines the direction for a while. As we have been telling subscribers its latest rally attempt off the support line has our attention. It is approaching the upper limit of the triangle where it will either break out to the upside, or fail again.

So it’s interesting that gold closed down yesterday, and at least at the moment this morning it’s down another $13 an ounce, and back below its 30-day m.a.

A few casual observations.

1. It’s eye-catching when economic reports from the housing industry, and now employment, have recovered to the point of being compared to levels in early 2008, and in housing to numbers not seen since 2007.

2. As preparations are made for the upcoming budget talks, various forecasts are coming out as to for instance, how much must be cut from the annual Federal budget in order to get the national debt down by certain amounts in ten years. They all seem to be based on extending current economic growth, revenue from taxes (personal income taxes, corporate income taxes, capital gains & dividend taxes), etc., out ten years.

Do they really think the economy will not see any improvement in the rate of growth for 10 years, more people working, more closed businesses re-opening or replaced by new ones as demand increases, corporations seeing sales and profits recover further, more investors making taxable profits as the millions of frightened-off investors slowly move record levels of cash from low-yield savings accounts and bonds to investments with higher taxable profits?

That’s the kind of dire estimates that were made during the Reagan years, the last time record budget deficits and record debt levels were seen due to massive government spending efforts to pull the nation out of the 1970’s economic meltdown.

3.  On a related subject, it’s interesting that the state of Florida, one of the hardest hit states in the 2008-09 meltdown; a housing industry collapse, near the top of the lists for housing foreclosures, plunges in home prices that drastically lowered the state’s revenue from real estate taxes, bank closures, high unemployment, and state budget deficits, has already recovered enough, even with unemployment still higher than the national average, that its legislature is now projecting a sizable budget surplus for 2013, proposing raises for teachers, etc. 

To read my newspaper column from last weekend click here: Corporate Hoarding Of Cash May Soon Become A Big Positive!

Subscribers to Street Smart Report: The new issue of the newsletter is in your secure area of the Street Smart Report website from yesterday afternoon. There will be an in-depth Global Markets update there later today.

Yesterday in the U.S. Market.

A mixed day. Trading volume ran at around the new normal of 0.6 billion shares trading on the NYSE, 1.6 billion on the Nasdaq.

The Dow closed up 67 points, or 0.5%. The S&P 500 closed up 0.2%. The NYSE Composite closed down 0.2%. The Nasdaq closed up 0.3%. The Nasdaq 100 closed up 0.6%. The Russell 2000 closed down 0.3%. The DJ Transportation Avg. closed up 0.1%. The DJ Utilities Avg closed down 0.2%.

Gold closed down $6 an ounce at $1,685.

Oil closed down $1.17 a barrel at $95.51 a barrel.

The U.S. dollar etf UUP closed unchanged.

The U.S. Treasury bond etf TLT closed down 0.2%.

Yesterday in European Markets.

European markets were mostly somewhat positive yesterday. The Europe Dow closed up 0.2%. Among individual countries, the London FTSE closed up 0.3%. The German DAX closed up 0.2%. France’s CAC closed down 0.4%. Greece closed up 2.0%. Ireland closed down 0.2%. Italy closed down 0.8%. Spain closed down 0.2%. Russia closed up 0.5%.

Asian Markets closed mixed Tuesday night and again last night.

The Asia Dow closed down 0.3% Tuesday night and down 0.2% last night.

Among individual markets last night:

Australia closed up 0.5%. China closed down 0.8%. Hong Kong closed down 0.2%. India closed up 0.2%. Indonesia closed up 0.1%. Japan closed up 1.3%. Malaysia closed up 0.4%. New Zealand closed up 0.1%. South Korea closed down 0.8%. Singapore closed up 0.5%. Taiwan closed down 0.6%. Thailand closed up 0.7%.

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Markets This Morning:

European markets are mostly up this morning. The Europe Dow is up 0.3%. Among individual countries the London FTSE is up 0.6%. The German DAX is up 0.2%. France’s CAC is up 0.3%. Spain is up 0.3%. Greece is down 1.5%. Italy is up 0.4%. Russia down 0.1%.

Oil is up $.82 a barrel at $96.05.

Gold is down $13 an ounce at $1,673.

This Morning in the U.S. Market:

In addition to being a holiday-shortened week in the U.S. this week is a quite light week for potential market-moving economic reports, but they will include the Chicago Fed’s National Business Activity Index that has been an accurate measure of recessions, Leading Economic Indicators, Existing Home Sales, etc. To see the full list click here, and look at the left side of the page it takes you to.

There were no reports on the holiday Monday.

Tuesday’s reports were that the Chicago Fed’s National Business Activity Index declined to +0.02 in December, down from +0.27 in November. But the more important 3-month m.a. improved from minus 0.13 in November to minus 0.11 in December, moving a little further away from the minus 0.7 that the Fed considers to be showing the economy is in recession. Existing Home Sales declined 1% in December, but remained at a high level, up 12.8% from the previous year. But the Richmond Fed’s Mfg Index unexpectedly plunged from plus 5 in December to minus 12 in January.

Yesterday’s only report was the FHFA Home Price Index, which showed that house prices rose 0.6% in November, making for a 12-month increase of 5.6%.

This morning’s only report so far is that new weekly unemployment claims fell 5,000 last week to 330,000, the lowest level since January, 2008. The four-week moving average fell by 8,250 to 351,750, the lowest level since March, 2008..

Still to come is the Leading Economic Indicator Index, which be released at 10 a.m.

The pre-open indicators remain flat as they have been all morning.

Our Pre-Open Indicators:

Our pre-open indicators are pointing to the Dow being up 15 points or so in the early going this morning.

To read my newspaper column from last weekend click here: Corporate Hoarding Of Cash May Soon Become A Big Positive!

Subscribers to Street Smart Report: The new issue of the newsletter is in your secure area of the Street Smart Report website from yesterday afternoon. There will be an in-depth Global Markets update there later today.

I’ll be back with the next regular blog post on Saturday morning, as usual later than the week-day posts, probably around 11 a.m.

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