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31Jan2017 Market Update: DOW Down Triple Digits, Crude Prices Trading Higher, The US Dollar Remains Weak Below 100 Level, Interest Rates Expected To Remain Unchanged

Written by Gary

Wall Street stocks are lower today (SPY -0.4%), dragged down by technology and industrial shares, amid disappointing earnings and weak consumer confidence data. The U.S. Federal Reserve is expected to keep interest rates unchanged in its first policy decision since President Trump took office, as the central bank awaits greater clarity on his economic policies.


Here is the current market situation from CNN Money

North and South American markets are mixed. The Bovespa is higher by 0.58%, while the S&P 500 is leading the IPC lower. They are down 0.47% and 0.20% respectively.

Traders Corner - Health of the Market

Index Description Current Value
Investors.com Members Sentiment: % Bullish (the balance is Bearish) 68%
CNN's Fear & Greed Index Above 50 = greed, below 50 = fear 52%
Investors Intelligence sets the breath Above 50 bullish 68%
StockChart.com Overbought / Oversold Index ($NYMO) anything below -30 / -40 is a concern of going deeper. Oversold conditions on the NYSE McClellan Oscillator usually bounce back at anything over -50 and reverse after reaching +40 oversold. -20.40
StockChart.com NYSE % of stocks above 200 DMA Index ($OEXA200R) $NYA200R chart below is the percentage of stocks above the 200 DMA and is always a good statistic to follow. It can depict a trend of declining equities which is always troubling, especially when it drops below 60% - 55%. Following a major market correction, the conditions for safe re-entry are when:
a) Daily $OEXA200R rises above 65%
Secondary Bullish Indicators:
a) RSI is POSITIVE (above 50)
b) Slow STO is POSITIVE (black line above red line)
c) MACD is POSITIVE (black line above red line)
73%
StockChart.com NYSE Bullish Percent Index ($BPNYA) Next stop down is ~57, then ~44, below that is where we will most likely see the markets crash. 71%
StockChart.com S&P 500 Bullish Percent Index ($BPSPX) In support zone and rising. ~62, ~57, ~45 at which the markets are in a full-blown correction. 71%
StockChart.com 10 Year Treasury Note Yield Index ($TNX) ten year note index value 24.48
StockChart.com Consumer Discretionary ETF (XLY) As long as the consumer discretionary holds above [66.88], all things being equal, it is a good sign for stocks and the U.S. economy 84.32
StockChart.com NYSE Composite (Liquidity) Index ($NYA) Markets move inverse to institutional selling and this NYA Index is followed by Institutional Investors 11,190

What Is Moving the Markets

Here are the headlines moving the markets.

Trump pushes drugmakers for lower prices, more U.S. production

WASHINGTON/LOS ANGELES (Reuters) - U.S. President Donald Trump on Tuesday met with top executives from some of the biggest drugmakers, calling on them to boost U.S. production and lower prices, while he also promised to speed up approval times for new medicines.

Wall Street loses ground as earnings, data disappoint

(Reuters) - U.S. stocks were lower on Tuesday, dragged down by technology and industrial shares, amid disappointing earnings and weak consumer confidence data.

Fed likely to keep rates steady as it awaits Trump economic plan

WASHINGTON (Reuters) - The U.S. Federal Reserve is expected to keep interest rates unchanged on Wednesday in its first policy decision since President Donald Trump took office, as the central bank awaits greater clarity on his economic policies.

Warren Buffett: I bought $12 billion of stock after Trump won

(Reuters) - The failure of Warren Buffett's favored candidate to capture the White House has not dimmed the billionaire's appetite for stocks.

Elliott turns up CEO pressure blending activism with buyouts

NEW YORK/SAN FRANCISCO (Reuters) - Eight days after Elliott Management disclosed a 7.6 percent stake in LifeLock Inc , managers of the more than $30 billion hedge fund met with executives at the consumer protection company.

Deutsche Bank fined for $10 billion sham Russian trades

NEW YORK/FRANKFURT (Reuters) - Deutsche Bank has agreed to pay $630 million in fines for organizing $10 billion in sham trades that could have been used to launder money out of Russia, the latest in a string of penalties that have hammered the German lender's finances.

Valero says record biofuels compliance costs to continue in 2017

NEW YORK (Reuters) - Valero Energy Corp on Tuesday signaled that record high costs to comply with the U.S. renewable fuels program will continue this year, after the oil refiner was hit with a ballooning tab for the program in 2016.

EU must seek new trade deals if U.S. looks inward: Eurogroup president

AMSTERDAM (Reuters) - The European Union will have to establish new trading partnerships if its traditional economic and political ally the United States heads down a path of protectionism, Eurogroup President Jeroen Dijsselbloem said on Tuesday.

Uber strikes deal with Daimler to add self-driving Mercedes-Benz to fleet

SAN FRANCISCO (Reuters) - Uber Technologies Inc [UBER.UL] has signed another deal with a major automaker as the popular ride service accelerates efforts to build out one of the world's first fleets of autonomous vehicles.

The Fix-Nothing Farce Of Symbolic Politics

Submitted by Charles Hugh-Smith via OfTwoMinds blog,

Solutions gut the rackets by breaking down the status quo's regulatory walls protecting the privileged elites who are strip-mining the bottom 95%.

Much of what passes for politics these days is symbolic. Anyone who studies the issue of illegal immigration concludes that the solution lies not in building $10 billion walls but in changing the incentive structure of citizenship, legal and illegal immigration. As long as successfully crossing the border enables access to free healthcare, education and sanctuary and the potential for cash work--the equivalent of winning the lottery for those with none of these benefits--walls will be tunneled under, overflown or bypassed by sea.

The Trump Administration's proposed policies on tariffs, walls to stop illegal immigration, etc. are defended as symbolic gestures--in other words, their value is in communicating "things have changed", not actually solving the problems facing the nation.

On the other side of the spectrum, protests in defense of a corrupt, failed status quo are also symbolic. No thinking person can claim that the status-quo policies on illegal immigration are fair, just or functional; how is letting illegal immigrants "jump the queue" ahead of the hundreds of thousands of legal immigrants who have labored patiently for years, paying all the outrageous costs of navigating the Kafkaesque complexities of legal immigration fair or just?

Protesting in defense of a racket-based status quo fixes nothing and solves nothing. Protests are also purely symbolic: the indignant express their indignation, gather to support a corrupt, venal system of rackets and then go home to stroke their egos on social media: I struck a ...

Why February May Be An Ugly Month For Markets: Here Are BofA's "Danger Signals"

With the S&P500 ending January on the back foot, more pain may be in store for markets in February.

This is the observation of BofA's chief technician Stephen Suttmeyer, who provides several danger signals why bulls may want to be particularly cautious ahead of the coming months.

As he notes, the post-Presidential Election S&P 500 rally has done better than the post-Brexit rally, but there are warning signs moving into February just as there were coming off the mid-August post-Brexit S&P 500 peak.

These include complacent VXV/VIX and put/call ratios, a bearish divergence for the US most active advance-decline line, and a Net Tab sell signal. In addition, there is the risk of a weaker
February based on seasonals and the US Presidential Cycle Year 1 pattern going back to 1928. A close below 1.17 on the VXV/VIX as well as a cross for VIM Distribution above VIM Accumulation would increase the risk for following weaker February seasonals.

Of the items listed, we find the seasonal argument most persuasive. While February tends to be a weaker month for the S&P 500 in general and is up only 52.8% of the time with an average return of -0.05% going back to 1928, February is particularly weak in the first year of a presidential cycle: in that case February is up only 41% of the time with an average S&P 500 decline of 2.10%. Even more troubling, when the President is in his first term, February of Year 1 is up only 23% of the time with an average decline of 3.84%.

Why Executives Are Speaking Out on Travel Ban and Why More Might Follow

President Trump's immigration order has mostly drawn criticism from companies with employees directly affected, but others may join them as they see international reputations threatened.

CIT Shakes Its OneWest Hangover

Lighter regulation and faster economic growth could help CIT recover from a problematic merger.

H&M's New Sales Target Won't Revive Growth

H&M has fallen out of investment fashion. For that to change, management needs to make clearer how its online strategy will revive flagging growth and margins in its core stores.

January 2017 Conference Board Consumer Confidence Retreats

Written by Doug Short / Jill Mislinski

The latest Conference Board Consumer Confidence Index was released this morning based on data collected through January 19. The headline number of 111.8 was a decrease from the final reading of 113.3 for December, a downward revision from 113.7. Today's number was below the Investing.com consensus of 113.0.

Earnings Outlook: ConocoPhillips earnings: Where will the company go next?

Company's fourth-quarter report comes after disappointment at rival Chevron.

Earnings Outlook: Exxon's earnings: Expect an update on plans for the Permian Basin

Production goals and Exxon's plans for the Permian are high on Wall Street's list. canad

Earnings Outlook: Apple earnings: iPhone 7 could break streak of shrinking sales

Apple Inc. and its iconic smartphone may return to growth when the tech giant reports holiday-quarter earnings after the market closes Tuesday, which would reverse the first declines since the iPhone was born.

Earnings Summary for Today

Earnings Calendar provided by Investing.com.

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To contact me with questions, comments or constructive criticism is always encouraged and appreciated:

gary@econintersect.com

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