Bear Mountain Bull

It’s time again for a little BMB R&R, especially with the market behaving as bizarrely as it’s been. Maybe if we stop watching it start to behave a little better…

Posting will be very light and variable over the course of this week, but we’ll put up an open thread each market day for our readers to comment on the day’s market activity or to post any interesting links they might run across.

Check the space below for whatever the latest might be during this ‘off’ time, and please visit the various sites in the ‘Links’ and ‘Regular Stops’ for up-to-date market news and analysis.

BMB will be back in full swing by next weekend.

Joe Duarte provides a rundown on geopolitical risks that could affect the markets in ‘05.

The markets started higher this morning and never really looked back, as the major indices stayed in positive territory throughout the day and finished at or near their session highs. The Dow broke above the highs of its recent trading range and finished up 95 points (+0.9%) at 10638. The S&P 500 also moved above its recent highs, adding 11 points (+0.9%) to 1199, and the Nasdaq gained 20 points (+1.0%) to close at 2148. The Russell 2000 gained 6 points to 638, and the 10-year Treasury continued to defy the Fed’s rising short-term rates by holding steady at 4.15%.

Market internals were strong across the board, with advances leading declines by more than 2 to 1 on the NYSE and just slightly less on the Nasdaq. Up volume led down volume by nearly 3 to 1 on both exchanges. There were 367 new highs to 26 new lows.

There were winners almost across the board today, led by natural gas stocks (+2.1%), commodities (+1.8%), computer hardware (+1.8%), oil (+1.7%), internet stocks (+1.7%), utilities (+1.6%), and gold stocks (+1.5%).

Crude oil moved slightly higher to $41.18/barrel, the US Dollar Index fell slightly and gold prices rallied back up to above $438/ounce.

I know most of you have been waiting breathlessly for the annual shakeup in the Nasdaq 100 index. Well, your wait is finally over.

BMB thinks that the Nasdaq should put a few more rules in place, like, a company should have to show a profit for a certain period of time before they’re made part of the Nasdaq 100. Companies like the satellite radio folks - Sirius and XM - would have to prove themselves a bit before they become part of the index. But, of course, my opinion doesn’t count.

Schaeffers’ weekly look at sentiment and technical indicators, currently showing that market is more likely to pull back than surge ahead in the near future.

Fleckenstein offers his view on the current speculative environment and where the economy might be headed in ‘05.