Monday, November 07, 2005

Market Up Again

Today the market decided to sit on its hands.  Yes, the Dow was up about 55 points but the dullness of trading was evident in the light volume.  For Monday, the market was not as strong as one might have imagined.  The market has begun to roll over again and probably will catch many off guard.  There are so many people right now who are willing to believe the bullish scenario of the year end rally.  We have seen a powerful rally for the last week and of course immediately everyone is bullish.  At the same time, many stocks are not trading with any real strength.

We continue to think that the market can drop into the end of the month and we are voting with our pocketbook.  Yes, we have lost some money over the past week but the possibility of a rout was high about two weeks ago.  That was averted and here we are again in the 10,500’s with the Dow.  

The precious metals are still looking lower and we see some of the stocks in the group as beginning to show signs of holding up in the face of declining gold.  In order for us to get excited about the mining stocks, we need to see the metal drop while the stocks kind of hold.  This could be starting as we speak.  We will be watching this carefully over the next two weeks and looking for some good entry points. The dollar broke to a new high for the move above 91 and that is hurting the metals prices, just something else to help us find a good entry point.

The real estate market keeps getting bad news.  The interest rate on fixed rate home mortgages now sits right around 6.3% after being around 5.5% in July.  This along with the news on the proposed tax law changes is starting to wear down the real estate market.  The housing boom may be ready to take a breather.

Dow Industrials:  10,586.23  +55.47
RYVNX:  19.98
TLT: 88.42

2 comments:

Anonymous said...

Glenn,

The F3 was an odd occurance. My family and I were visiting friends in Ohio over the weekend and had no cell service until Sunday afternoon. Family called and left messages that prompted us to call home and check in. Fortunately, we incurred no damage at home. The damage was in Newburgh and SE of 164 and Green River Road area. Joel from our CPI area lost the entire roof to his home but thankfully, neither he nor his wife were injured.

As for the stock picks, I almost called you to see if you could locate the article on-line at WSJ site so I could send to some others. ADM was one of the picks I remember. All the stocks were priced in the $20 range. I cut the article out and took it home. I'll bring it in and pass on the ideas later this week.

Erick

Glenn said...

I think I found the article you mentioned. It lists five US companies and two ADR's. The five US companies are ADM, TEU, JEF, TK, WOR. I'll look into them over the weekend and see what we can find.

Glad to hear you and your family are safe. When I heard it went through the Southeast side of town, I didn't think you would have been affected too much.