Thursday, December 4, 2008

The Kirk Report

The Kirk Report

Mailbag

Posted: 04 Dec 2008 03:07 PM CST

It has finally dawned on me that I need to do more frequent mailbag posts. After putting out a request for more interesting questions earlier this week, my inbox was flooded with a lot of awesome questions. I will try to get to most of if not all of them in due time, but for today's mailbag I'll cover the following:

  • Trading On Fear & Panic

  • A Treacherous Environment To Buy & Hold

  • Mortgaging Our Kids' Futures

  • Mentoring Possibilities

  • Where The Best Opportunities Are

  • Website Upgrades

  • Averaging In Or Down In This Market

  • Stock Screens Adrift

  • This Is No Time To Wallow In Misery

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Trail Blazing

Posted: 04 Dec 2008 01:31 PM CST

This posting includes an audio/video/photo media file: Download Now

Sell The Jobs Report Trade?

Posted: 04 Dec 2008 08:30 AM CST

Good morning. Premarket futures are showing a negative bias as investors sort through a number of headlines.

As expected, big rate cuts overseas from the both the ECB & Bank of England are in focus along with the latest from the automakers who apparently are now considering pre-arranged bankruptcies in a last-ditch effort to get federal aid.

Much like yesterday, the earnings news and outlooks from companies like Credit Suisse, Merck, & Adobe Systems continue to disappoint as we await tomorrow's jobs report. This morning the Monster Employment Index fell seven points in November reporting that online job availability at its lowest level since 2004 while jobless claims fell 21,000 during Thanksgiving week. Several firms, including AT&T, have also just announced job cuts.

Meanwhile, investors are trying to figure out how the holiday shopping season is going with some interesting Cyber Monday comparisons and lots of same-store sales numbers as retailers have another ugly month.

Premarket gainers: MNKD, ENZN, PSS, FNM, FRE, PHM, SNPS, CETV, TRIN, AVAV, NOK, WMT, OSK, NARA, TMA, UIS, SQM, CTAS, & DSX.

Premarket losers: ISIL, CRUS, SNDK, GM, ABK, DD, ADBE, JAS, F, DMND, HOTT, BHP, ESLR, ERIC, AAUK, FSLR, AML, AIR, RBS, AZO, TSRA, ENL, STLD, GFI, FIG, DD, & NCC.

At 10:AM we have a report on factory orders and an hour or so later Bernanke is scheduled to speak about housing. The Treasury is now considering a new plan to help homeowners that would push mortgage rates as low as 4.5% on new loans. Meanwhile, the automakers will present their restructuring plans to the Senate Banking Committee also at 10:AM.

Technically, we've climbed back into short-term overbought territory again ahead of tomorrow's jobs data. I suspect that's why we're seeing some negative premarket activity and it will be telling if we can rally both today and tomorrow in spite of whatever the jobs report shows. Clearly, it makes sense to anticipate a sell the bad jobs news reaction, which is why I'm not so sure we'll see one even though we're currently overbought. It seems to me that the market doesn't want to be too negative ahead of what will likely be additional bailouts next week for automakers to homeowners and that alone may help to overshadow what is already expected to be bad news on jobs. So, in other words, I'd be careful establishing both new long and short positions until we see how the market responds to the jobs data.

Have a terrific Thursday!

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