Weekly Market Newsletter, 27 October 2008
The Week Ahead: U.S. stock markets are at 5 year lows coming into this week and experiencing one of the worst months on record. Buying is still on low volume suggesting that rallies are bear market traps. The Federal Reserve meets this week on Tuesday and Wednesday with a 1/2 point rate cut expected. A 3/4 point cut may help turn markets around. Other reports include: new home sales on Monday, consumer confidence on Tuesday, a widely anticipated Q3 advanced GDP number on Thursday, and personal income and spending on Friday.
Stocks to Watch: Sony Corp. (SNE) cut its full year profit guidance from $2.9 to $1.5 billion as the stock reached a 15 year low and continues in oversold territory. Timken Co. (TKR) maker of power transmission and friction management products fell to 7 year lows despite beating earnings estimates because it expects a significant drop in earnings for Q4. Hartford Financial Services Group (HIG) moved up on hopes insurance companies may be included in the $700 billion rescue plan and could be forming a double bottom.
Special Note: The lock limit down on the futures market for the Dow Industrials and S&P 500 on Friday, the first since 1997, are hinting that the major averages are preparing to break the lows set earlier this month as the Nasdaq Composite already has. Also, the Dow has yet to reach the 20 year moving average near 7700 while the S&P 500 and Nasdaq already have. A final capitulation in selling pressure that many traders desire along with lower lows probably into November could be lower than most expect. A move below 7197 on the Dow set in 2002 would mean a continuation of the bear market earlier this decade.
Commentary provided by Barry Ward, Registered Principal, NobleTrading.com, Inc.
Click here to open an account.
NobleTrading Direct Access Trading
email: info@nobletrading.com
phone: 877.872.3311
web: http://www.nobletrading.com
Stocks to Watch: Sony Corp. (SNE) cut its full year profit guidance from $2.9 to $1.5 billion as the stock reached a 15 year low and continues in oversold territory. Timken Co. (TKR) maker of power transmission and friction management products fell to 7 year lows despite beating earnings estimates because it expects a significant drop in earnings for Q4. Hartford Financial Services Group (HIG) moved up on hopes insurance companies may be included in the $700 billion rescue plan and could be forming a double bottom.
Special Note: The lock limit down on the futures market for the Dow Industrials and S&P 500 on Friday, the first since 1997, are hinting that the major averages are preparing to break the lows set earlier this month as the Nasdaq Composite already has. Also, the Dow has yet to reach the 20 year moving average near 7700 while the S&P 500 and Nasdaq already have. A final capitulation in selling pressure that many traders desire along with lower lows probably into November could be lower than most expect. A move below 7197 on the Dow set in 2002 would mean a continuation of the bear market earlier this decade.
Commentary provided by Barry Ward, Registered Principal, NobleTrading.com, Inc.
Click here to open an account.
NobleTrading Direct Access Trading
email: info@nobletrading.com
phone: 877.872.3311
web: http://www.nobletrading.com
posted by NobleTrading at
8:46 AM
<< Home