STTG Market Recap January 16, 2014

Thursday brought a quiet day of consolidation after a hectic 2 day run.  The S&P 500 fell 0.13% while the NASDAQ actually gained 0.09%.   Some key financial company earning reports were at the forefront as was a very bad day for Best Buy (BBY).  There was a host of economic data but none really moved the market:

The consumer price index rose 0.3 percent in December, the largest increase since June.The National Association of Home Builders reported confidence among home builders declined a bit in January after spiking in December, while the Philadelphia Fed’s manufacturing index edged higher to 9.4 in January from a revised 6.4 the prior month.

With today’s quiet session, we will post the 2 longer term charts of the indexes; you can see the NASDAQ is back at the top of this very long channel while the S&P 500 bounced off a support line created by connecting the highs of second half of 2013 in mid December and has not looked back.

nasdaq

nasdaq

The biotechs have continued in 2014 exactly where they left off in 2013, while the broader healthcare sector in general has been a very strong group to begin this year.

ibb

xlv

Best Buy (BBY) declined 28 percent after the consumer-electronics chain reported a decline in holiday sales.

The company cited intense discounting by rivals, tight supplies of tablets and phones, and weak traffic in December for the disappointing report, which was the latest evidence that holiday sales at many retailers came at the expense of profit. Best Buy decided to cut prices sharply to thwart competition from Wal-Mart Stores Inc and other rivals in what turned to be one of the most promotional seasons since the recession.  Best Buy expects operating margin, excluding items, to be 175 to 185 basis points lower in the current fiscal fourth quarter than a year earlier.

bby

Financial companies also have had a strong start to the year but took a breather today as Goldman Sachs (GS) reported a 21 percent drop in quarterly profit; Citigroup (C) posted a lower-than-expected quarterly profit.  Citigroup had been very extended technically coming into the report.

c gs

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