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.

Apple reported great earnings.

BMB’s take is that Apple’s numbers shouldn’t come as a huge surprise. Everyone has known for quite a while that the IPod is selling like hotcakes. The question is, can Apple keep it going?

The markets managed to rally a bit into the close today, something they hadn’t managed to do yet this year. The late surge morphed a rather listless trading day into a more positive day than we’ve been seeing of late. The Dow moved higher by 62 points (+0.6%) to 10618, the S&P 500 added 5 points (+0.4%) to 1188 and the Nasdaq gained 13 points (+0.6%) to 2093. The Russell 2000 also gained a litte ground, adding less than 2 points to 613 and the bond market moved higher sending the 10-year Treasury yield down to 4.24%.

Market internals also painted a more positive picture today, with advances/declines at 9 to 7 on the NYSE and 8 to 7 on the Nasdaq. Up volume/down volume was 4 to 3 on the NYSE and 3 to 1 on the Nasdaq.

Groups moving higher were hospitals (+3.4%), oil services (+2.4%), oil stocks (+1.5%), semiconductors (+1.4%) and internets (+1.3%). Moving lower were transportations stocks (-1.3%), hurt by a more than 7% drop in shares of UPS on an earnings warning.

Crude oil prices moved higher on production outage news, gaining $0.69 to $46.37/barrel. The dollar moved 1.0% lower on the record trade deficit report, and gold traded higher to $426/ounce.

Apple reports earnings after the bell today, which is sure to have some impact on tomorrow’s action.

Oil prices have moved higher today on news of production outages in the Gulf of Mexico, the North Sea, Nigeria and Iraq.

The markets have gone nowhere but down since the new year began, but that has done little to instill fear into investors. How low do prices have to fall before people begin to fear the possibility of a falling market?

	The VIX started to rise during the holidays, but turned right around and began to move lower after the new year — despite the selloff in the markets.
	The CBOE equity only put/call ratio has stopped falling, but the moving averages haven’t moved convincingly higher — although the 10-day has crossed back above the 21-day. Daily reading have begun to move slightly higher, and we may see the MAs move higher as older, lower readings are replaced in the calculation.

VIX chart courtesy of StockCharts.com

The November US trade gap grew 7.7% from October. That news has hurt the dollar this morning.