logo
  Join        Login             Stock Quote

Stock Market Opening Report - November 7, 2012

 November 08, 2012 12:52 AM


Whew, that was quick. The day after the election, stocks nosedive. The media were all over the news headlines, and TV talking about here comes the fiscal cliff. Did it sneak up on them, like a surprise party? No, everybody knew before the election, but it was an inconvenient topic. The same thing goes for the debt limit needing to be raised once again. Funny, I don't think either candidate mentioned it, but it was all over the news today. Hmm, wonder why that would be?

On Tuesday, none of it mattered, on Wednesday; it was all the rage, crashing stocks. The bloody tape with above-average volume did some major technical damage. The NASDAQ, Dow, and S&P 500 each set new cycle lows. All three doing setting new lows simultaneously is called confirmation. The downtrend remains intact, unfortunately.

[Related -Defensive Sectors Lead Hesitant Market, But Traders Honor Long-standing Bullish Support]

iStock would like to be able to say the blow-off had the markings of a bottom, but no. Without blowout volume, it's just another down day. Now, there are those like Goldman Sachs that suggest the market must drop at least 15% to catch the attention of law makers to strike a grand bargain to fix the fiscal situation.

Could the market drop 15% from its peak? That would put the S&P 500 in the range of 1,258. It's possible, but the first real level of support is around 1,375, then 1,325, 1,300, and then the final backstop between 1,275 and 1,260ish. After that, and the equity markets would be barreling towards bear market territory. So, yes, 15% is possible. For now, we put the odds at no more than 20%. 

[Related -Will Janet Yellen's Outlook Prevail?]

Our odds are based on the likelihood that some cosmetic "grand bargain" will be reached and that the debt ceiling will be raised as quietly as Tim Geithner's request before the election. 

Just as quietly, third-quarter earnings and profits perked up a little since we last covered it. Sales are up 2.46%, operating earnings up 4.43%, and as reported eps gaining 9.44% year-over-year. However, guidance for the fourth quarter remains tepid. Perhaps, public companies are just "managing expectations."

That's it for today.

Happy Trading

iOnTheMarket Premium
Advertisement

Advertisement


Post Comment -- Login is required to post message
Name:  
Alert for new comments:
Your email:
Your Website:
Title:
Comments:
 

rss feed

Latest Stories

article imageDefensive Sectors Lead Hesitant Market, But Traders Honor Long-standing Bullish Support

Last week, the major indexes fell back below round-number thresholds that had taken a lot of effort to read on...

article imageWill Janet Yellen's Outlook Prevail?

Federal Reserve Chairwoman Janet Yellen told the crowd last week that rate hikes are coming. The rise will read on...

article image3 Deep Value Stocks That Could Mount A Turnaround

Although the market action was a bit choppy in the first quarter of 2015, one fact is inescapable: the read on...

article imageFrenzied Speculative Activity In China's Equity Markets

It's time to take another look at the recent developments in China's equity markets as major indices hover read on...

Advertisement
Popular Articles

Advertisement
Daily Sector Scan
Partner Center



Fundamental data is provided by Zacks Investment Research, and Commentary, news and Press Releases provided by YellowBrix and Quotemedia.
All information provided "as is" for informational purposes only, not intended for trading purposes or advice. iStockAnalyst.com is not an investment adviser and does not provide, endorse or review any information or data contained herein.
The blog articles are opinions by respective blogger. By using this site you are agreeing to terms and conditions posted on respective bloggers' website.
The postings/comments on the site may or may not be from reliable sources. Neither iStockAnalyst nor any of its independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. You are solely responsible for the investment decisions made by you and the consequences resulting therefrom. By accessing the iStockAnalyst.com site, you agree not to redistribute the information found therein.
The sector scan is based on 15-30 minutes delayed data. The Pattern scan is based on EOD data.