STTG Market Recap Mar 27, 2015

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Friday was a bit of a nothing day for the U.S. indexes as stocks bounced back a tiny bit from a string of losses; most of the gains came late in the session as Fed head Janet Yellen spoke and takeover news hit the semiconductor group. The S&P 500 gained 0.24% and the NASDAQ 0.57%. Yellen said a rate increase may be warranted later this year, adding that an increase in core inflation is not essential before the Fed raises rates. “She gave no hint when the first hike will come and reiterated that even when they come the pace will be gradual. it’s the same old,” said Peter Boockvar, chief market analyst at the Lindsey Group. Today’s gains halted a string of 4 losing days this week; the last time the S&P posted losses for every consecutive day from Monday to Friday was in May 2012.

In economic news, the third estimate for fourth-quarter U.S. gross domestic product (GDP) came in unchanged at 2.2 percent. While corporate profits fell, consumer spending was revised higher to 4.4 percent from 4.2 percent, the fastest rate since the first quarter of 2006. Usually second or third revisions of GDP have little effect on the market.

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STTG Market Recap Mar 26, 2015

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Indexes stayed in the red much of the session and finished with light losses; the S&P 500 fell 0.24% and NASDAQ 0.27%. Fun fact: The S&P 500 has gone 27 days without posting back-to-back gains, the longest stretch since 1994. Keep in mind earnings season starts in 2 weeks so make sure you know when your companies report if you are not a person who holds stocks for multiple years – generally you can expect a lot of volatility (in either direction) on those days.

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STTG Market Recap Mar 25, 2015

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A very interesting day in the markets as the S&P 500 fell 1.46% and the NASDAQ 2.37%. Biotechs were crushed today – we’ve been saying the higher they go the more risk they get as they have been on a mostly interrupted run for 4+ years. That said you just never know when they will correct and even if it’s a bubble you ride a bubble until it clearly ends. We are not saying it is ending – just pointing out the risk factors. Today was one of those days people who have been in biotech stocks with almost “no risk” felt some pain. Also of worry is the effect of dollar on earnings season that starts back up in April – a lot of multinational companies have massive exports and we’ve already seen companies such as Nike mention the dour effect of the higher dollar. So there could be negative surprises ahead.

Per Reuters:

Earnings are expected to be down 3.1% for the S&P 500, the first decline since 2009. Earnings are expected to be hit by the stronger dollar’s impact on foreign sales. Falling oil prices are also expected to take a bite out of energy company earnings.

The dollar is also hitting some economic data as February’s durable goods orders posted a decline, rather than the modest expected increase, under pressure from the strong dollar and weak global demand. Bookings for goods meant to last at least three years declined 1.4% after a 2% gain in January that was smaller than previously estimated. Analysts had expected a 0.2% gain. So bad news was actual bad news today rather than good news because it keeps the Fed in its emergency stance.

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STTG Market Recap Mar 24, 2015

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Inflation data caused a bit of a selloff Tuesday as the S&P 500 fell 0.61% and the NASDAQ 0.32%. Inflation has been very benign in the U.S. during this Fed easing cycle and appears to be the only thing aside from a booming economy that will move the Fed to tighten. While today’s numbers were really quite benign, some pointed to the core CPI figure as a thing to worry about – but reality is it will take months on end of unexpected inflation to really force the Fed’s hand.

U.S. Consumer Price Index rose 0.2% in February, in line with analysts’ expectations, the Labor Department said. The gain came after dropping 0.7% the previous month. The so-called core CPI, which strips out food and energy costs, increased 0.2% in February after a similar gain in January. In the 12 months through February, the core CPI rose 1.7%, the largest increase since November.

In other economic news, February new home sales rose 7.8% to 539,000, the highest level in seven years.

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STTG Market Recap Mar 23, 2015

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U.S. indexes were generally positive until the closing minutes when some sort of selling program pushed indexes into the red. The S&P 500 fell 0.17% and the NASDAQ 0.32%. News flow was quiet as existing home sales in February were up 1.2%, to an annual rate of 4.88 million units, slightly below expectations.

Fun fact: The S&P 500 has gone 24 consecutive sessions without back-to-back advances, the longest since a 24-day stretch in 2008.

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