STTG Market Recap Nov 16, 2012

With markets so extremely oversold any hint of positive news would be a potential catalyst for driving markets higher.  Friday, investors received such news – although it was nothing more than some constructive comments from Congress in regards to talks about the now tired “Fiscal Cliff”.  The S&P 500 gained 0.48% and the NASDAQ 0.57%; modest gains but after two weeks of pain, they were welcomed.  Technically the S&P 500 fell almost perfectly to its 61.8% retracement of the entire June-Sept rally – quite ironic in terms of the timing of this news to have the index bounce off this level.

The NASDAQ is just floating around at this time – technicals are not really the issue; it will follow the S&P 500.

Everyone’s favorite stock, Apple (AAPL) broke below May’s lows in the morning but reversed with the rest of the market later in the day.  Any sort of bounce from this stock should provide relief to the market.  With this type of selling we’ve seen it looks like hedge fund liquidations have been happening.

On this indicator the small rally today only took stocks from extremely oversold to very oversold.

 

Despite the market rally, Sears Holdings (SHLD) was crushed to the tune of nearly 20% as it reported another poor quarter.  Sales slid about 6% during the quarter.

From Sentimentrader.com:

” This is the 7th time since 1950 that the S&P 500 has sunk to a three-month low in the weak leading up to Thanksgiving.  After the six others, from Thanksgiving through year-end, the S&P was positive five times, returning +3.8%, +13.0%, -2.2%, +10.8%, +2.1% and +1.7%.”

Outside of markets, the big news of the day was the death of Twinkies.   Ok well not the product but the producer of the product is going bankrupt, laying off 18,000+ workers.

  • The maker of the iconic U.S. snack Twinkies said Friday it is going out of business and laying off all of its 18,500 workers after a national strike crippled its operations.  The company, founded in 1930, was fighting battles beyond labor costs. Competition is increasing in the snack space, and Americans are increasingly conscious about healthy eating.
  • Thousands of members of the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union went on strike last week after rejecting in September a contract offer that cut wages and benefits. Hostess had already reached a contract agreement with its largest union, the International Brotherhood of Teamsters.

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