Hello Everyone,
As usual I continue to look for the
easiest, most functional method of delivering my weekly market update to our
list of readers via email. This is
essentially a trial issue using a new HTML email service instead of sending the
update as an email attachment or providing a link to the same on your
website. AOL users you will still need
to view the update through the website under UPDATES. Of course, all the contents of the standard weekly update
(sectors, 5 senses, market meter) are not included in this version yet but I
would like to ask for your feedback once more using the survey box on the
right. Please tell me truthfully what
you think of this new format. Thank
you. On to the weekly update.
Last week I discussed the very
murky condition of the markets. There
was very little convincing evidence either way concerning the future direction
of the markets. We were watching the
meaningful lows of 5/14 and 5/30 as a key level of support for the
markets. We were also watching weekly
charts and wondering how the impact of June earning’s warning might affect the
markets. Well the good news is that
conditions have improved since that day of bewilderment. Support levels held and all indexes,
including the mighty semiconductors, bounced strongly from the last lows. However, certain areas of the market are
doing much better than others. Even
though market breadth (the total number of stocks moving higher or lower)
continues to improve, it is still just as important to be selective and STAY
INVESTED IN THE RIGHT PLACE. Since the
beginning of the rally, the best risk reward sectors and asset classes have
been healthcare, financials, small caps (specifically small cap value) and
midcap value funds. Notable newcomers
to the stable growth party are funds that focus on emerging market debt (SCEMX)
and various real estate funds (FRESX, STMDX).
The Chart-o-the-week button on the left will take to a picture of STMDX
If you are techcentric, can only
understand investing in technology, than recent activity has provided a very
defined course of action. The Nasdaq
100 Index (NDX), the gorilla of all technology indexes, is trading in a well
defined 10% range. The upper end of the
range is 2052 and the lower end is
1779. A break above the range
would be a bullish indication for the future of technology and break below the
range would be very bad, probably leading a few jaw-dropping down days. So the situation here is still murky, while
many other segments of the market continue to make new highs.
Special note to clients – I will be
out on vacation next week from the 11th- 15th. If you have any pressing issues please get
in touch with me tomorrow (Friday).
There will be no update next week.
Thank you, have a nice week. Sam
Jones
