STTG Market Recap July 3, 2014

This week proved to be a VERY typical holiday week – light volume with a market that drifts upward.  In fact it was stronger than usual as we had 2 quite strong up days.   Today we had the S&P 500 up 0.55% and the NASDAQ 0.63% as the monthly employment data came in well above expectations.

Nonfarm payrolls increased by 288,000 jobs last month and the unemployment rate fell to 6.1 percent, its lowest level since September 2008, the Labor Department said.  Data for April and May were revised to show a total of 29,000 more jobs created than previously reported.   Data for April and May were revised to show a total of 29,000 more jobs created than previously reported.  Nevertheless, the labor force participation rate, or the share of working-age Americans who are employed or at least looking for a job, was steady at 62.8 percent, a low struck in December for the first time since 1978.

The indexes are in “up, up, and away” mode as they are now nowhere near their 10 day moving averages.

spx nasdaq

We have not looked at copper in a while since it has been doing little but we can see it is finally moving up.  Why is this something to watch? Copper is used in a vast variety of industrial uses so when it jumps in price it tends to indicate economic activity is picking up.   Now with that said, China has been such a huge user of the metal the past 7-8 years it might indicate more about China than the global economy but whatever the case it is finally waking up.

copper

And when the commodity moves, copper related stocks can surge – note the volume spike and stock move of Southern Copper (SCCO) the past few days.

scco

Freeport McMoran Copper and Gold (FCX) is the giant in the space.  Of course these 2 stocks have already made a huge move but if copper has a multi month run ahead of it, these are names that will rotate into the spotlight.

fcx

Oil on the other hand is receding – it looks like that spike due to Iraq was just due to a news catalyst.

wtic

If you are looking for a way to play the GoPro (GPRO) craze without touching the very volatile IPO there is an interesting chip company named Ambarella (AMBA) which is cosely associated.  Estimates are that 25% of its business is from GoPro. Of course that can be a blessing and a curse – if GoPro business suffers, investors/traders will flee Ambarella as well, but we are presenting the name to you for your own research.

AMBA

Have a great 4th of July and we’ll see you back here Monday!

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