Market Wrap
Stocks shook off some poor economic numbers in the morning and rallied out of an early dip, then ignored terror attacks in India in the afternoon and rallied further, leading into the Thanksgiving holiday.
The indices, along with internals, were a healthy green, and closed at the highs of the day – but volume was predictably light:
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Treasuries continued their move higher, pushing yields even lower, with the 10-year now below 3 percent:
6-month: 0.47 2-yr: 1.09% 5-yr: 2.01% 10-yr: 2.98% 30-yr: 3.52%.
Internals were quite positive, but that volume was missing. Advances/declines were 6 to 1 on the NYSE and 15 to 4 on the Nasdaq, with up/down volume better than 9 to 1 on both exchanges. Even a few new highs were seen – highs/lows were 7/43 on the NYSE and 6/117 on the Nasdaq.
All of the groups finished green. Leading the way were the metals (+11.8%), steel (+11.7%), homebuilders (+9.4%), oil services (+8.9%), semiconductors (+7.6%), disk drives (+7.5%), brokers (+7.1%), natural gas stocks (+6.9%), gold and silver stocks (+6.1%) and retailers (+5.9%).
Energy prices were higher. Crude oil rose to $54.14/barrel, gasoline jumped to $1.18/gallon, and natural gas got a boost to $6.88/mmBTU. The dollar index bounced back up to 85.61. Gold lost a few bucks to $808/ounce, and silver lost a penny to $10.26/ounce.
BMB Note: Four up days in a row for the Dow – first time since April, according to CNBC. Yikes.
Anyway, the market made a nice turnaround today, putting up some decent numbers after the morning dip. But I’m always afraid to give too much weight to these light-volume holiday sessions, and Friday’s half-day will be another one. I’d like to see maybe a little pullback, then see some volume start to come in on the up days, especially as things now try to work their way through some significant overhead resistance. Maybe they can bounce this thing up into the beginning of the new year. We’ll see.
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Have any thoughts on whether tax loss selling will have much affect in December? Seems like there will be some.
Comment by Bruce from Flagstaff — 11/26/2008 @ 5:21 pm
Hard to say. Maybe some of the selling we’ve already seen has been tax related. To me it doesn’t matter a heck of a lot – selling is selling and buying is buying. And lately we’ve seen a lot more selling than buying!
Comment by BMB — 11/26/2008 @ 5:54 pm
BMB – I’d expect volume to be down this week as half the traders are out stuffing turkeys (probably along with the ones in their portfolios!). Nevertheless, the resilience of the market is “new behavior”. Things work until they don’t. In the past, every rip was sold almost immediately. We’re seeing very light profit taking, and *egads* the market is actually short-term OVERBOUGHT if you can believe it. However, a smart trader once told me, two of the most bullish things a market can do is 1) get overbought and stay there, and 2) simply go up. ‘nuf said. Happy Thanksgiving to the entire Bear Mountain family, and I give thanks to you for maintaining such an informative site. THANK YOU!!!
- Greg
Comment by Greg Larsen — 11/26/2008 @ 5:57 pm
Thanks Greg – and best Thanksgiving wishes to you too, as well as all the other BMB readers. Obviously, the site wouldn’t be the same without all the contributions from readers like yourself, and I’m humbled by the fact that people take the time to visit the site.
On the market, let’s see what happens from here. It would be nice to see a little pause and/or pullback, and then some hefty follow-through to the upside. Maybe that could get something going that could last more than a few days.
Comment by BMB — 11/26/2008 @ 6:12 pm
BMB – that’s exactly the scenario I’m looking for. This Friday’s half-day would be perfect for such a pause, maybe a little pullback on Monday too, then Turnaround Tuesday takes us up a new leg. Jeff Cooper’s 917 looks very interesting right now…and potentially 990 in the next month or so. Have a great day off, and good luck!
-Greg
Comment by Greg Larsen — 11/27/2008 @ 2:29 am
But then again, we don’t always get what we want.
Comment by BMB — 11/27/2008 @ 7:56 am