March 19, 2024

Fed day snaps S&P 4 day win streak

Index & Sector performance 10/30/13

The Market:

A small gap up on the open was quickly sold and the market pulled back but losses were relatively contained until the Fed announcement which sent the S&P spiking lower.  Buyers did then step in and used the last hour of trading to help close the index off the lows but not enough to keep from snapping the S&P 500’s 4 day win streak.

In economic news, ADP Non-Farm came in lower than expected printing a 130K with 151K the expectation.  Core CPI was also light coming in at 0.1% when 0.2% was target while the headline CPI met expectations (remember Core strips out Food & Energy).  Finally the day finsihed with the FOMC statement and rate decision.  The rate stayed unchanged and the Fed also continued with the $85B/mo bond purchasing noting that they want to see more evidence before lowering the program.  Tomorrow we get Unemployment claims (341K estimate) and Treasury Secretary Lew speaks all before the open.

Story Stocks:

General Motors (GM) reporting earnings which initially looked shockingly below expectations but were due to s special charged which backed out showed a small beat (96c vs 93c est) on slightly lower than expected revenue ($39B vs $39.49B est).

Also making moves today on earnings were NuVasive (NUVA), DreamWorks (DWA) and Electronic Arts (EA) closing up 22.33%, 17.36% and 7.75% respectively.  On the downside Questcor (QCOR) lost 13.94% after their report.

Today was tough day for Teva (TEVA) shareholders as the company lost just over 8% after announcing the CEO will be stepping down.  Some resignations are well received by Wall Street, this was obviously not one.  TEVA is a very beaten name and assuming there is not a broader company wide scandal announced, this name may be worth adding to the Watch List for potential opportunities.

The following noteworthy companies are scheduled to report earnings before tomorrow’s open: XOM, COP, MA, EPD, TWC, DISCA, EL, MPC, CI, PPL, CLX, MGM, AVP, OSK

Analyst Comments:

Upgrades 10/30/13

Downgrades 10/30/13

Initiations 10/30/13

Price Target Changes 10/30/13

The Game Plan:

Could today be it?  Could it FINALLY be “the top”?  Before you answer, think about how many other times you might have answered Yes only to watch the market continue higher.  That is what happens in strong moves both up and down, they extend.  Key levels to watch on the downside if your long is today’s lows at 1757 and then the 10/23 lows of 1740.50.  Below there and the market could look to target the 20 day SMA which comes in at 1721 as of the close.

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