From our individual stock service, TradeGuru - Investors suffered through a volatile week with markets trying to sort out the implications of sharply declining oil prices while continuing to buy any meaningful dip in stocks. The meaningful dip part kicked off the week with the S&P 500 falling -1.8% as renewed fears of a Greek exit from the Euro and another drop in oil prices pushed investors into the safe harbor of U.S. Treasury bonds. The 10-year Treasury bond yield fell below 2% Tuesday as stocks experienced further pressure with the small-cap Russell 2000 index giving up -1.7% on the day. Wednesday gave us a rebound in stocks presumably driven by word of German willingness to restructure Greek debt, thus avoiding the debt default the market fears, along with follow-on technical buying after stocks found support at the point of the December market lows. Stocks logged a +1.2% gain for the day. The rebound accelerated Thursday with a complete offset of Mondays losses on little new news other than a happy report regarding Apple (AAPL) app sales, which pushed the market heavyweight stock up +3%. The +1.8% gain in the S&P brought most stock indexes back to flat for the year. Fridays effort was a modestly negative affair with initial enthusiasm over a good jobs report (11 months of +200k jobs) quickly giving way to selling as wage growth in the report was lacking. But those rather fractional domestic issues do not seem to be the primary market driver. Friday saw significant weakness in financial shares; and it just feels like fears of financial contagion from the very quick drop in oil prices, along with uncertainty as Greece potentially elects a Euro-unfriendly party, hang over the market keeping volatility high. Stocks gave back -0.8% Friday while the Dow Jones Industrial Average posted a fifth consecutive day of 100+ point moves, delivering two days during the week of +/- 300 points. That level of market swing is indicative of the high level of confusion greeting market participants each day. (Subscribe for more at tradeguru/facebook)
Posted on: Sun, 11 Jan 2015 09:48:57 +0000