There was so little news yesterday that buyers and sellers were at a stand-off, and so stocks traded in a narrow range with volume declining to just over 800 million shares on the NYSE. Energy stocks were the best performers in reaction to what seems a more settled political climate in the Middle East. The euro fell to a three-week low versus the U.S. dollar on concerns over the health of a German bank.
Daily Stock Market News
Dow: -5 points at 12,268
S&P 500: +3 points at 1,332
Nasdaq: +8 points at 2,817
Volume and Breadth
NYSE: 816 million shares; advancers ahead 1.4-to-1
Nasdaq: 514 million shares; advancers ahead 1.2-to-1
Futures and Related ETFs
March Crude Oil: -74 cents at $84.84 per barrel; Energy Select Sector SPDR (NYSE: XLE) +$1.63 at $75.74
April Gold: +$4.70 at $1,364.60 per ounce; PHLX Gold/Silver Sector Index (NASDAQ: XAU) +4.39 points at 208.12
What the Markets Are Saying
Even with a major political crisis in the most economically sensitive part of the world, stocks continued to plow ahead as if all was right with the world. We could call it “buyers’ blinders” since the uncertainties are almost too numerous to count. And even the most ardent optimist, with a brief background in investing, knows that at some point something will trigger a sell-off. However, until the signal is given, holders of stocks are better off, well, just holding stocks.
In the meantime, we’ve got a dead boring advance going, which is great for the bulls. But I must confess that in a situation where the charts of the major indices show a line of advance at 45-degree angle with stocks running higher at a measured pace day after day, I find it difficult to come up with something new to say every day. Last night, I poked around the Net to find a seed of truth that might germinate into an idea for you this morning. A source that I often go to when in need of a refreshing idea is my good friend Bryan Perry’s double-digit income investing newsletter Cash Machine.
Bryan is very articulate and a great source of money-making ideas — and a terrific fishing buddy, as well. I pulled up his latest issue and found Bryan quoting my Feb. 8 Daily Market Outlook discussion on inflation, and I am truly honored. Bryan has been providing the tools needed to manage a high-yield asset portfolio to his clients for years. As he puts it, “Learning skills of how I manage high-yield assets through every kind of market environment is a tool box of investment knowledge you can use for the rest of your life.”
He further points out that, “Energy, industrials and technology are powering higher, enticing more and more capital inflows into equities as more evidence emerges that the U.S. economy is finding its legs.” And goes on to say, “Having structured our portfolios months ago to be sensitive to what is now unfolding in the form of higher commodity prices and higher interest rates puts us in a position to not just fight inflation, but profit from it.”
Bryan and I have not talked about the oil tanker companies, but last week I referred to the purchase of oil tanker stocks as a hedge against a possible slowdown in crude oil and refined shipments, and recommended Teekay Corp. (NYSE: TK) as the Trade of the Day. I note that he has TK and Ship Finance International Limited (NYSE: SFL) on his buy list — both have big dividend yields and haven’t yet had a big move because of recent financing deals. In my opinion, they are both ready to head north.
Take a look at our Trade of the Day for another of Bryan’s favorites.
Today’s Trading Landscape
To see a list of the companies reporting earnings today, click here.
For a list of this week’s economic reports due out, click here.
If you have questions or comments for Sam Collins, please e-mail him at samailc@cox.net.
