Stock Market
All comments and Stock Market Ananlysis are made by Guy Brumley. Guy has been trading the Stock Market daily since 1992.
Trading, evaluating stock prices and predictions
Stock Market Commentary 6-4-2009
The Dow turned in a textbook performance today, after breaking out of the 8200-8600 trading range on Monday; we reversed Wednesday morning back to 8598 then bounced back to 8675. The breakout held its first test. The market internals were also very weak, making this a good day to trade in and out.
The economic numbers released today, one the ADP payroll numbers, two the ISM services and three the factory orders all indicated we are still contracting, with the only good news being the contraction was at a slower rate.
The other news story was Bernanke speaking in front of the House Budget Committee. The story line is he expects growth later this year, just not robust. He also discussed the need for the government to slow its spending, stating the debt is going to be harder to finance. The foreign buyers (China) are losing their appetite for our bonds, leaving the US investor as the next option. To attract this group’s money, (which is currently in money markets and the stock market), would require higher interest rates. Both these events, depletes the stock market, and the resulting effects are estimated at a 20% draw down for the stock market.
Thursday has unemployment claims at 7:30 am CDT. This will probably hold the market in check, up and down 75 points, and closing flat, leading into Friday morning’s employment number.
Meanwhile, the new high list (NASD) has 10 stocks, including TSRA at 27. TSRA has a low of 8.33 and a trend line high of 43. This is expensive at 27, unless the court ruling from the middle of May, and the licensing agreement with Motorola can be quantified. Put this one on the watch list.
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