Daily Wrap
DJIA -81.45 (-0.56%) to 14,537.14; S&P 500 -10.40 (-0.67%) to 1,541.61; NASDAQ -40.03 (-1.44%) to 2,741.95
Today was another strong down day but had more back and forth than previous sessions. Stocks started the day slightly positive following up on an Unemployment claims number that wasn’t necessarily bullish but also and maybe more importantly wasn’t bearish and came in relatively inline with estimates. Those early gains gave way and at the lows the S&P 500 cash index was down roughly 16 points. Overall the action was not like previous sessions and it did feel as though the market is trying to set-up for a bottom. How significant that bottom could be will have to be seen.
Apple Computers (AAPL) was again in the news as the stock dropped over 2% making fresh lows and after spending a brief moment in the $300’s, finally printed there today. AAPL has earnings 4/23 and will be a name many focus on. I went over more detailed thoughts on AAPL and ways to trade it yesterday but my note today is just that this stock is in the control of the technicians so some are looking for news or reasons why the stocks is moving. I think your wasting your time there and realize it is moving based on the trend and the technicals. There were some negative analyst comments but that’s nothing new and frankly its also what’s needed to start a bottom.
Morgan Stanley (MS) continued the financial companies reporting earnings and they lost over 4% after reporting what looked to be an OK number with a beat on earnings and revenues (excluding DVA). There was a host of big names reporting earnings last night and pre-market today so I will not cover them all but if your interested in the fundamentals, this is the time to be reviewing reports and conference calls for guidance and insight into trends and potential.
The coal stocks should all be thank Peabody Energy (BTU) for their earnings report which was far from bullish but also not as bad as many may have feared. BTU gained 7.57% on the report and other coal names also gained including Arch Coal (ACI) and Alpha Natural Resources (ANR). I have been watching coals for a while and I do believe there will be a point where the sentiment on these names is just too negative and they turn. I don’t want to make 1:1 comparisons but maybe something like we saw with the refiners recently. That time could be sooner rather than later BUT there will also be many opportunities to get in as a trader or investor without having to worry about picking an exact bottom.
The following noteworthy companies are scheduled to report earnings before tomorrow’s open: GE, MCD, SLB, HON, KMB, STT, BHI, STI, GPC, KSU, LH, COL, UA, IPG, MAN
In analyst notes today, UPS (UPS) was upgraded to Outperform with a $100 price target at RBC Capital and Fusion-io (FIO) was upgraded to Buy at Stifel with an $18 price target. Following the UPS upgrade, RBC Capital downgrade FedEx (FDX) to Underperform with an $87 price target. Some of these and other upgrades and downgrades for the day can be found each morning when I post my 9 @ 9 in the Upgrades/Downgrades section.
Today’s action violated the 50 day SMA in the S&P 500 and for the bulls I would really want to see the market start to firm up. If it cannot then we will likely be in for lower levels. My only complaint for more downside is from the contrarian view as it seems in the media I hear many analysts saying we are going to $1500 or lower so possibly we are poised to bottom before, at least in the short term.
