Trump Gets to Work, Markets Cringe

S2 S1 PP R1 R2 Daily change Last Index
(-0.14%) 19,800 DJX
224.54 225.34 226.08 226.88 227.62 (-0.27%) 2,265 SPX
122.19 122.77 123.15 123.73 124.11 (-0.04%) 5,553 Nasdaq

 

Uncertainty about new administration does not play into stocks’ hand

Stocks on Wall Street traded down yesterday as Donald Trump started his first work week as the leader of the free world. Trump met with the CEOs of leading American companies yesterday, promising to drastically cut regulation that hinders business activity. On his first day in office, Trump also, with one stroke of the pen, terminated the 12-member transatlantic trade agreement, giving traders ample reason to cast doubt about the durability of the sharp rally that followed the elections. Trump, thereafter, announced that he hopes to renegotiate the North American Free Trade Agreement (NAFTA) with Canada and Mexico. In summary for the day, the S&P 500 shed 0.27%, the NADSAQ closing negligibly off by 0.04%.

Earlier in the trading day, Trump met with the heads of a dozen prominent American manufacturing companies in the White House, conveying that he plans on cutting regulation and lowering corporate taxes to accelerate economic growth. Later on in the week, Trump will meet with the CEOs of the top American automobile and construction companies.

The rally after the elections led Wall Street to record a series of historic highs, the rally though halting of late with the S&P 500 recording moderate losses over the last few weeks as investors started to voice concern about the potential offshoots of Trump’s isolationist trade policy. On a technical basis, the situation remains the same, the Dow Jones stuck in a narrow trading range over the last 2 months, cordoned off by the 20,000 point level from above and the 19,750 point level from below. Concern is growing among investors and the narrow trading range defining the major market indexes leaves the market vulnerable to more extensive losses.

The UUP index which tracks dollar performance against a basket of world currencies fell to a 7 week low of 100.18 point. On the heels of the continued declines, precious metals – and first and foremost, gold – climbed to a 2-month high. The ETF for gold mines, the GDX, soared 3%.

The energy sector (XLE) closed off 1.06%, making it the worst performing sector of the 11 on the S&P 500, while crude prices fell on the background of signs of a strong recovery in the number of American rigs in operation. Halliburton (HAL) weighed on the sector with sharp losses of 2.9%, after the world’s second large oil field service provider reported a larger than expected loss for last quarter.

Qualcomm (QCOM) toppled 12.7% to the $54.88 level after Apple (AAPL) submitted a huge $1 billion lawsuit against the chipmaker this past Friday. Yesterday, the company suffered its worst trading day since November ’15 – making it the biggest weight on both the S&P 500 and the NASDAQ.

On the S&P 500, 16 stocks rose to new 52-week highs, 6 dipping to new yearly lows; on the NASDAQ, 79 stocks recorded new 52-week highs, 41 falling to new yearly lows.

About 6.15 billion shares changed hands on U.S. exchanges, in line with the daily average over the last 20 trading days.

Tuesday: Wall Street is now waiting for further detail about tax rates and is digesting the developments revolving Trump’s trade policy, traders, in the meantime keeping their eyes on the lookout for today’s economic reports in hopes of seeing further signs of U.S. economic growth. The question is whether the economy can continue improving irrespective of the Trump administration’s policies.

Real estate and manufacturing figures are expected to be released today before closing in advance of key reports on durable goods orders and economic growth (GDP) that will be released on Friday.

December’s new home sales are expected to have recorded a slight decline to an annualized pace of 5.5 million units. In November ’16, the home sales rate of 5.61 million was the fastest clip recorded since 2007.

Markit’s PMI manufacturing index for January is expected to record a reading of 54.5 points, last month’s reading being 54.3 points.

In addition to these figures, traders will carefully track any developments related to Trump’s policies in his second day in office.

This is the second full week of the earnings season. Among the companies reporting today before opening we’ll find MMM, DD, BABA, JNJ, TRV, KMB, LMT, DHI and AKS. After closing, be primed for the numbers of AA, COF, DFS, ISRG and STX.

Tuesday’s Hot Stocks: SE, OXY, NUE, SYMC, KMB, BABA, DD, AKS, YHOO

IPOs: None

Have a great trading day!

Economic Calendar
DAY TIME (EST) Event Forecast Impact
Tuesday 10:00 Existing Home Sales 5.55M Medium
Wednesday 9:00 FHFA Housing Price Index Medium
Wednesday 10:30 Crude Inventories Low
Thursday 8:30 Initial Claims 246K High
Thursday 10:00 Leading Indicators 0.5% Medium
Thursday 10:00 New Home Sales 589K Medium
Friday 8:30 GDP-Adv. 2.2% Medium
Friday 8:30 Durable Orders 3.0% Medium
Friday 10:00 Michigan Sentiment – Final 98.0 High

 

Earnings Calendar
Symbol Company AM/PM Day
MCD McDonald’s Corporation AM Monday
HAL Halliburton Company AM Monday
YHOO Yahoo! Inc. PM Monday
JNJ Johnson & Johnson AM Tuesday
BABA Alibaba Group Holding Limited AM Tuesday
LMT Lockheed Martin Corporation AM Tuesday
KMB Kimberly-Clark Corporation AM Tuesday
MMM 3M Company AM Tuesday
TRV The Travelers Companies, Inc. AM Tuesday
DD E. I. du Pont de Nemours and Company AM Tuesday
CA CA, Inc. PM Tuesday
TXN Texas Instruments Incorporated PM Tuesday
COF Capital One Financial Corporation PM Tuesday
STX Seagate Technology plc PM Tuesday
HES Hess Corporation AM Wednesday
ABT Abbott Laboratories AM Wednesday
TXT Textron Inc. AM Wednesday
NSC Norfolk Southern Corporation AM Wednesday
STT State Street Corporation AM Wednesday
UTX United Technologies Corporation AM Wednesday
BA The Boeing Company AM Wednesday
WDC Western Digital Corporation PM Wednesday
LVS Las Vegas Sands Corp. PM Wednesday
QCOM QUALCOMM Incorporated PM Wednesday
EBAY eBay Inc. PM Wednesday
MCK McKesson Corporation PM Wednesday
XLNX Xilinx, Inc. PM Wednesday
CCI Crown Castle International Corp. PM Wednesday
LRCX Lam Research Corporation PM Wednesday
VRTX Vertex Pharmaceuticals Incorporated PM Wednesday
NOW ServiceNow, Inc. PM Wednesday
CTXS Citrix Systems, Inc. PM Wednesday
NOC Northrop Grumman Corporation AM Thursday
SWK Stanley Black & Decker, Inc. AM Thursday
SHW The Sherwin-Williams Company AM Thursday
WRK WestRock Company AM Thursday
BIIB Biogen Inc. AM Thursday
TROW T. Rowe Price Group, Inc. AM Thursday
MJN Mead Johnson Nutrition Company AM Thursday
RTN Raytheon Company AM Thursday
RCL Royal Caribbean Cruises Ltd. AM Thursday
F Ford Motor Company AM Thursday
CMCSA Comcast Corporation AM Thursday
BMY Bristol-Myers Squibb Company AM Thursday
LUV Southwest Airlines Co. AM Thursday
DOW The Dow Chemical Company AM Thursday
CAT Caterpillar Inc. AM Thursday
CELG Celgene Corporation AM Thursday
POT Potash Corporation of Saskatchewan Inc. AM Thursday
PYPL PayPal Holdings, Inc. PM Thursday
SBUX Starbucks Corporation PM Thursday
JNPR Juniper Networks, Inc. PM Thursday
INTC Intel Corporation PM Thursday
MSFT Microsoft Corporation PM Thursday
GOOGL Alphabet Inc. PM Thursday
MXIM Maxim Integrated Products, Inc. PM Thursday
KLAC KLA-Tencor Corporation PM Thursday
VMW VMware, Inc. PM Thursday
GD General Dynamics Corporation AM Friday
NEE NextEra Energy, Inc. AM Friday
CL Colgate-Palmolive Company AM Friday
HON Honeywell International Inc. AM Friday
AAL American Airlines Group Inc. AM Friday
ABBV AbbVie Inc. AM Friday
CVX Chevron Corporation AM Friday

 

# Date Stock Long\

Short

Statues Date Close Profit \ Loss # Date Stock Long \Short Statues Date Close Profit \ Loss
1 5.12.2016 CSC Long Close 6.12.2016 -1.62% 17
2 6.12.2016 YY Short Close 7.12.2016 +0.72% 18            
3 7.12.2016 ROST Long Close 14.12.2016 +0.42% 19
4 9.12.016 TWLO Short Close 13.12.2016 +2.01% 20
5 12.12.2016 PDCO Long Close 14.12.2016 +0.48% 21
6 13.12.2016 TLRD Long Open 22.12.2016 +1.87% 22
7 13.12.2016 IGT Short Close 14.12.2016 -0.19% 23
8 14.12.2016 CC Long Close 21.12.2016 +0.52% 24
9 29.12.2016 JWN Short Close 6.1.2017 +3.45% 25
10 6.1.2017 TRGP Long Close 9.1.2017 +0.20% 26
11 9.1.2017 NVDA Long Close 17.1.2017 +1.02% 27
12 10.1.2017 TLRD Long Close 10.1.2017 -3.27% 28
13 13.1.2017 LW Long Open   -1.16% 29
14 30  
15 31  
16 32

 

Today’s Picks – Swing “New-York Strategy

No.1 – FAST

Company Name Fastenal 
Entry Point 51.56
Stop Area 50.45
1st Target 52.30
Swing Target
Avg. Volume
2.66M
Sector Services | Industrial Equipment Wholesale
Earnings Date
Risk Rate Normal
Risk\Reward Ratio 1.38:1

No.2 – WMB

Company Name The Williams Companies
Entry Point 27.99
Stop Area 28.65
1st Target 27.55
Swing Target 22.39
Avg. Volume 9M
Sector Basic Materials | Oil & Gas Pipelines
Earnings Date 15 Feb
Risk Rate Normal
Risk\Reward Ratio