Dollar Goes Down

Here we are at the beginning of May.  Normally, we would have seen a pretty solid advance in the few days preceding the first of the month but on Friday the market had to deal with the MSFT news.  MSFT ended down over 3 points over 11% to a price that is essentially at the lows of the past few years.  The NASDAQ did suffer a loss due to this big drop in MSFT.  These NASDAQ indexes are determined by the Value of the stocks in them so when a Big stock like MSFT goes down 11% the indexes get hit pretty hard with both the Comp and the NDX down nearly 1%.

Over the weekend, we see the headline on BARRON’s magazine that says “DOW 12,000” and just wonder how bullish people are.  It is true that the Dow didn’t suffer much at the hands of MSFT on Friday due to several components being up enough to nearly make MSFT a non-event for the Dow.  The bullishness is almost arrogant at this time with the comments about all the bad news out there not being able to affect the market.  They are speaking of high oil and gas prices, higher interest rates, a weakening dollar and other commodities being higher.  

Last week the Fed Head made comments that seemed to make everyone think the Fed is about to PAUSE in its interest rate hiking campaign.  This announcement did some damage to the dollar but the stock market was supposed to have done better because of the news and didn’t.  Bonds didn’t seem to get hurt too badly on the news either, one of my weekend reads called the bond market the “deer in the headlights”.  

In the week upcoming, we do see a few interesting items.  The first one being the immigrant walk out day on Monday.  Apparently, there is a large ground swell of support for this walk out with even some companies closing down just to accommodate the Immigrant Day Off.  The only reason we bring this up is that it could have some impact on the market, but we’re not sure what it might be.

The other is the jobs report on Friday.  This generally seems to be a market mover and with this market so ready to go down, the jobs report also seems like a good spark to start the market in the other direction.  As we get through the week we will continue to watch for this report and how the market acts going into the number.

“Sell in May and Go away” so you…
Be careful out there.

Dow Industrials:  11,367.14  -15.37
RYVNX:   18.44
RYAIX:  21.94
TLT:  84.16
BEGBX:  13.34 (dollar has been weak)