Weekly US Market Update and OutlookStocks keep oil in crosshairs
Dow, Nasdaq already reach bear territory as crude marches higher
Marketwatch: Stocks are expected to come under further pressure next week, as surging crude oil prices threaten to tip the broad market more convincingly into bear-market territory. Markets are now "ridiculously correlated" with crude, said Jim Paulsen, chief investment officer at Wells Capital Management. "If we see oil going up to $150, the markets will no doubt have more pressure." Crude surged more than 3% this past week to a new high above $145 a barrel. The price of oil has now doubled in less than a year. As the market prepares for the onset of second-quarter earnings season next week, investors will watch for signs of weak demand from cash-strapped consumers as well as the impact of surging energy costs to gauge the impact on bottom lines. On Thursday, U.S. stocks got some relief, with the Dow Jones Industrial Average closing up 0.7% at 11,288. The S&P rose 1.3 points to 1,263, while the Nasdaq Composite fell 6 points to 2,245. But in terms of the holiday-shortened week, the Dow still dropped 0.5% and it's down 20% from its Oct. 9 high of 14,165, putting the blue-chip index in bear-market conditions. The Nasdaq, which fell 3% on the week, is in the same rut, now down 21.5% from its Oct. 31 high of 1,562. Offering a slightly rosier assessment, the S&P 500 Index, which most Wall Strategists consider a more accurate gauge of the broader equities scene, remains a hair shy of the general definition of a bear market. It fell 1.2% in the week and is now down 19.2% from its Oct. 10 high of 1,562.
On Friday, stocks got some help from the government's June employment report, which was more or less in line with market expectations, and it somewhat offset worries that the economy is getting worse. The Labor Department reported nonfarm payrolls dropped by 62,000 workers last month, while the jobless rate remained steady at 5.5%. But investors also contended with news from the Institute for Supply Management, which said the services sector of the U.S. economy contracted unexpectedly in June, falling to its lowest level since the start of the year.
The Labor Department next Thursday will report this week's jobless claim, which is also on investors' radar. Separately, the National Association of Realtors will report May pending home sales next Tuesday.
Weekly KLCI Update and Outlook
I Capital: The Index has now fallen for five consecutive weeks to support level of 1,150 on selling pressure, spurred by the political uncertainty and surging oil prices. Furthermore, the global equities markets also gave up grounds on renewed concerns about inflation after oil price rose to a fresh record above $144 a barrel. Its weekly RSI has gone into the oversold position with its MACD and DMI bearish. If the KLCI breaks below the influential level of support, which is also the neckline of a head and shoulder pattern the bears will likely remain in control. A move toward the next support level of 1,090 is expected then.
* On the current lousy state of political situation. Is this what the leaders(and "leaders to be") want to instill in our society? ...lies, revenge, plots.... blood for blood...an eye for an eye.....a hole for a hole..who is the devil in disguise? I am getting very confused and worried.
On Friday, stocks got some help from the government's June employment report, which was more or less in line with market expectations, and it somewhat offset worries that the economy is getting worse. The Labor Department reported nonfarm payrolls dropped by 62,000 workers last month, while the jobless rate remained steady at 5.5%. But investors also contended with news from the Institute for Supply Management, which said the services sector of the U.S. economy contracted unexpectedly in June, falling to its lowest level since the start of the year.
The Labor Department next Thursday will report this week's jobless claim, which is also on investors' radar. Separately, the National Association of Realtors will report May pending home sales next Tuesday.
Weekly KLCI Update and Outlook
I Capital: The Index has now fallen for five consecutive weeks to support level of 1,150 on selling pressure, spurred by the political uncertainty and surging oil prices. Furthermore, the global equities markets also gave up grounds on renewed concerns about inflation after oil price rose to a fresh record above $144 a barrel. Its weekly RSI has gone into the oversold position with its MACD and DMI bearish. If the KLCI breaks below the influential level of support, which is also the neckline of a head and shoulder pattern the bears will likely remain in control. A move toward the next support level of 1,090 is expected then.
* On the current lousy state of political situation. Is this what the leaders(and "leaders to be") want to instill in our society? ...lies, revenge, plots.... blood for blood...an eye for an eye.....a hole for a hole..who is the devil in disguise? I am getting very confused and worried.
* Nikkei sets longest losing run over half century as it enters the 12 day share market losing run and shedded 1,200 points.
* Iceland decided to keep its policy rate unchanged at 15.5% and was not able to reduce it due to spiralling prices. Look out for recession announcement soon.
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