DJIM #3 2011

Despite another sell on the report by INTC following in the footsteps of AA +  another RRR hike by China, the market as a whole somehow managed to put in a decent green day on Friday.  A bit of a head scratcher, but more likely a move in part due to… .”As important or more today was the ‘speculation’ of Monday’s European Finance meeting and an expansion of the bailout fund to get the market going”(last week).  Nothing will be finalized Mon/Tues, but expectation is all sides will leak their intentions on the issue heading into an early February summit.   As long as there is progress, the market should be fine.  If not, watch out.  Watch Euro, you don’t want a sell off in it.

All in,  the attention will shift to earnings as the flow pick- ups in the upcoming week and individual stocks selection begins away from the broader market.  We're officially into 2H January where the quiet period for corp's/govt ends as holiday cheer subsides.  AAPL pulled the first such release this weekend.

Shadowlist

• Momentum/earnings/“winners of ‘10–   The SOX strength has been noted here on a daily basis and INTC’s guide for capex guide fueled the SOX, notably the equipment makers (KLAC types).   Sorry, but getting excited over lagging equipment makers is not in these cards going forward.   The sole DJIM beneficiary was recent addition CAVM, which made a new high to $46.  The momo’s/winners await earnings as discussed.  AAPL FFIV coming up.
• Commodities-  All focus here has been the Ag’s/Ferts’ and despite another RRR hike, the group outperformed (MOS CF up~3%) once again.   Also as warned post ACI report, the coals weakened ANR WLT - off 6-7%.

..meandering

As the market meandered near the flat-line in the morning, you as a trader begin to look over the Shadowlist to see any trends developing. What you see today, is what you see many days lately and that’s pockets of strength in stocks linked to any individual news. IE., First hour of trading,MCP  >10% on an acquisition, APKT >5% on target price increases and the flip side SODA down 10% on a 5mln share offering, NVDA on price decrease.  

Unfortunately, a sidelined market consists of days like this as traders jump on anything making news, even if it is as irrelevant as a price tgt increase without an upgrade attached.  Other more important trends were visible and that’s where ‘slower’ money is going instead of ‘fast money’ looking for a quick flip in and out. (see below).  If you pick up the relative strength early on, you can dwindle your Shadowlist trading list from 60 names to maybe 10 to concentrate on intraday.

By trading close, a meandering market continued and the stocks/sec’s noted here kept outperforming and/or underperforming.  Nothing really changed all day.

The SOX once again weighted on the market as the biggest underperformer <1%.  AMC, TXN bought a grandfather of a semi stock for a huge premium.  It will likely be a very temporary boost as pre-announcements possibilities are first and foremost in investor’s minds.

Shadowlist

■Momentum/ earnings/ winners of ’10 – Last week we noted strength in Chinese Internet related names, once again SOHU BIDU, SINA  were up 3-7%.

■Commodities  - Relative strength in Ag’s/ Chems continued to follow through post USDA report.

Update on Tuesday, April 5, 2011 at 04:59AM by Demi/ YourPersonalTrader

Apple Inc. will have its weighting
in the Nasdaq-100 Index lowered as part of changes to the gauge
by Nasdaq OMX Group Inc. to better reflect company market
capitalizations.

http://bloom.bg/gvckYr