Get The Ticker Tape delivered right to your inbox.

X

Streak at Stake — Can Street Make it Six Straight in Short Day?

Share Print
December 24, 2014

Asian markets gained overnight but Europe isn’t convinced, trading mixed so far on this Christmas Eve. U.S. stock markets have the spirit so far, as early indicators point up.The mood is lifted by a report showing a seven-week low for folks signing up for jobless benefits. Now, will energy market data keep the merry in this market? U.S. stock averages have a five-session rally at stake as many of the globe’s financial markets close early for Christmas Eve. The New York Stock Exchange and the Nasdaq Stock Market both shutter at 1 p.m. Eastern. Markets will remain closed Thursday for Christmas Day, and will reopen Friday with normal hours.

DJIA 20K? The Dow Jones Industrial Average (DJIA) unwrapped a shiny new record-high in Tuesday’s session, clearing 18,000 for the first time in the blue-chip benchmark’s history. Stock market historians note the market covered the last 1,000 points at the fifth fastest clip in the Dow’s history. In a year marked by violence in the Middle East and Ukraine, uncertainty around the Ebola virus and an oil-market upset, the DJIA’s deepest retreat all year was limited to 7%. Already, talk turns to the possibility of Dow 20K, possibly boosted by the so-called January Effect, a month that historically racks up additional gains. Technicians aren’t so sure. Daily trend-line resistance indicates a potential breach of 20,000 looks unlikely until late Q3 2015, although no guarantee for that timing. The S&P 500 (SPX) joined the party; it logged its 51st record high this year, closing at 2,082 and keeping talk of 2,100 alive.

Figure 1:

The Dow Jones Industrial Average (DJIA) clears 18,000 for first time in its history. To date in 2014, the DJIA’s pullbacks have been limited to 7%. Source: Dow Jones S&P Indices. Shown in the thinkorswim® platform from TD Ameritrade.

Jobless Claims Trend in Place: A tally of applications for jobless benefits revealed an unexpected drop of 9,000 to 280,000 in the latest reporting period; it’s the lowest total in seven weeks and backs a trend of few layoffs, say most Street economists. Now, this report isn’t without its blemishes. The government said continuing claims rose by 25,000 to 2.4 million in the week that ended Dec. 13. The less-volatile four-week average of continuing claims, which reflect the number of people already receiving benefits, rose 20,000 to 2.42 million. The jobless claims report follows a spate of mostly upbeat economic news jammed into Tuesday’s session, including a revised Q3 GDP reading of 5%, matching the best broad economic growth in the past 11 years.

Oil on Tap. Weekly oil data could draw broad-based market attention given recent pricing volatility. At 10:30 a.m. Eastern, the Energy Information Administration is expected to report a drawdown of 2.4 million barrels from U.S. crude-oil inventories for the week ended Dec. 19, according to a Platts survey. If that decline is realized it will contrast late-Tuesday data from the American Petroleum Institute that showed crude inventories rose 5.4 million barrels last week. Ahead of the data, West Texas Intermediate crude futures for February delivery fell below $57 a barrel. Brent crude futures dropped to below $61 a barrel. Energy continues to hold sway over the stock market, as falling gas prices appear to be lending a boost to consumer spending but nicking the bottom lines of energy concerns to a degree that may continue to weigh on the global economy.

Merry Christmas!

Good trading,
JJ
@TDAJJKinahan

JJ Kinahan

JJ began his career in 1985 as a Chicago Board Options Exchange...

Read full bio »
Recent Posts
March 30, 2017

Fed Speakers, Final Q4 GDP Reading Take Center Stage As End of Quarter Nears

The final word is in on Q4 gross domestic product (GDP), and it’s a bit better than expected. That and a host of Fed speakers could dominate the scene today.

March 29, 2017

Vote of Confidence: After Strong Consumer Data, D.C. Policy Back in Focus

Consumer confidence data inspired Tuesday's rally, and now the question is whether the markets can build on that. Indices remain just about 1.5% below all-time highs.