The Trader's Path: 21 Nov 2012 AMC

1 Nov 2012

Market Summary

It seems to me that the market is going to end the week with positive gains... the bears are taking a thanksgiving break and having lower volumes for the day..

On the eve of Thanksgiving... some of the stuff happened...

Some positive news from the middle east... calling for a truce... that might just stop oil from going up further...

While on the initial and continuing claims, it decrease a little bit and under the expectations of the analyst...

While on the Michigan sentiment report, the consensus fell marginally for the month of October.

For the week before the Thanksgiving, i doubt very much that the economic report will have much impact on the market. Especially the market will be focused on the Black Friday and Cyber Monday sales report and also the updates from the discussion between Congress and Mr Barack Obama.

Market Internals

Volumes were lower than average as the market is preparing for Thanksgiving. Most people will not be getting into the market before Black Friday and Cyber Monday... Bulls were outpacing the Bears yesterday on Lower volumes..

Leaders and Laggards

The Utilities sector continue to show weaknesses, which is the main laggard for Thanksgiving Eve.

Technical Updates

On the technical updates, SPX cleared the 200 MA, while DOW and NASDAQ are heading towards that mark... We will be expecting some resistance at the 200 MA of DOW and NASDAQ.

Nonetheless, I believe that the NASDAQ will be led by AAPL and which will in turn cause some effect on the rest of the indices..

Commentaries

Stock Market Update

16:20 ET Dow +48.38 at 12836.89, Nasdaq +9.87 at 2926.55, S&P +3.22 at 1391.03 :[BRIEFING.COM] The S&P 500 endured choppy trade during the first two hours of action. The index followed the early indecision with a run to session highs where it spent the majority of the afternoon. The market received some encouraging news from the Middle East where Israel and Hamas have reached a cease-fire agreement. However, the Eurozone remains a concern into the holiday as the next tranche of Greek aid is yet to be approved. Today's trade was confined to a tight range and volume was well below average. As a result, the S&P 500 ended higher by 0.2%.

The technology sector outperformed the broader market and the SPDR Technology Select Sector ETF (XLK 28.39, +0.09) settled higher by 0.3%. Apple (AAPL 561.70, +0.78) has been in focus recently due to the extended weakness observed in the stock during the past two months. Today, the biggest tech component tacked on 0.1% as the shares attempt to establish support in the $550 area.

In notable tech earnings, Salesforce.com (CRM 158.66, +12.76) spiked 8.8% after beating on the top and bottom lines. In addition to the quarterly beat, the cloud computing company issued in-line fourth quarter and full-year earnings and revenue guidance. PeerSAP (SAP 75.23, +0.87) added 1.2%.

Elsewhere, NCI (NCIT 4.58, +0.24) surged 5.5% after the company was awarded multiple task orders as part of its contract with the U.S. Army. The total value of the orders was reported at $27.1 million.

Also of note, Cirrus Logic (CRUS 31.16, +0.82) advanced 2.7% after the company's Board of Directors authorized the repurchase of up to $200 million of the company's common stock.

Industrial bellwether Deere (DE 82.83, -3.16) fell 3.7% after reporting mixed results. During the fourth quarter, the machinery manufacturer earned $1.75, which was $0.13 short of the Capital IQ consensus estimate. However, the company's revenue of $9.05 billion represented a 14.5% year-over-year increase, and beat expectations. Deere's outlook was mostly positive as the company expects full-year 2013 revenue above consensus and net income in-line with expectations.

The Dow Jones Transportation Average added 0.3%. Railroads saw relative weakness yesterday, but displayed strength today. Kansas City Southern (KSU 76.33, +0.69) andNorfolk Southern (NSC 57.03, +0.12) finished higher by 0.9% and 0.2%, respectively.

On the other hand, airlines which outperformed yesterday were among the biggest laggards. JetBlue Airways (JBLU 5.07, +0.05) and Southwest Airlines (LUV 9.24, +0.13) saw respective gains of 1.0% and 1.4%.

Today's choppy price action was reflected in the performance of individual sectors. However, utilities opened as the weakest performing group, and remained there for the duration of the session. Electrical companies have been pressured since Hurricane Sandy, and their shares felt the brunt of today's weakness. The SPDR Utilities Select Sector (XLU 34.18, -0.15) slid 0.4%. Among individual electricity producers, Duke Energy (DUK 60.23, -0.55) and NextEra Energy (NEE 67.25, -0.46) both lost near 0.7%.

The weekly MBA Mortgage Index pointed to a 2.2% decrease in mortgage applications during the past week. Today's reading followed prior week's increase of 12.6%.

The latest weekly initial jobless claims count totaled 410,000, which was lower than the 423,000 that had been expected by the Briefing.com consensus. The tally was below the revised prior week count of 451,000. As for continuing claims, they fell to 3.337 million from 3.367 million.

The University of Michigan's final Consumer Sentiment Survey for November fell to 82.7 from the 84.9 that was posted in the preliminary Survey. The Briefing.com consensus expected the reading to slip to 84.5.

Lastly, leading indicators for October increased by 0.2%, which was in-line with the forecast. Today's reading followed prior month's increase of 0.6%.

Note that equity and bond markets will be closed tomorrow in observance of Thanksgiving. Trading will resume on Friday, but the final session of the week will end at 13:00 ET. ..NYSE Adv/Dec 2016/969. ..NASDAQ Adv/Dec 1556/857

After Hours

16:40 ET No after hours movers on earnings/guidance :

The S&P 500 endured choppy trade during the first two hours of action. The index followed the early indecision with a run to session highs where it spent the majority of the afternoon. The market received some encouraging news from the Middle East where Israel and Hamas have reached a cease-fire agreement. However, the Eurozone remains a concern into the holiday as the next tranche of Greek aid is yet to be approved. Today's trade was confined to a tight range and volume was well below average. As a result, the S&P 500 ended higher by 0.2%.

Today after the close no companies are scheduled to report earnings.

Futures are slightly higher after hours: S&P 500 futures are +0.55 from fair value of 1388.55 and Nasdaq100 futures are +0.16 from fair value of 2599.09.

There are no economic reports scheduled to be reported for the remainder of the week.

There are no companies scheduled to report earnings for the remainder of the week.

Commodities