12:45pm (EST)
The market opened sharply lower this morning as crude prices soared while protests in Libya have caused some nervousness on Wall Street. The rising political turmoil in the Middle East has pushed oil to $94.48 per barrel, up $4.77, today while a weaker-than-expected S&P Case-Shiller number put the bulls behind the 8-ball early. The home-price index fell 4.1% from the prior year as prices in 18 of 20 cities were down but this didn’t stop the bulls. They immediately stepped in after the bell and lifted the market off its lows as they held support.
The bulls also got some help after the Richmond Fed manufacturing survey came in better-than-expected. Wall Street got a print of 25 versus expectations for 18. Meanwhile, Consumer Confidence came in at 70.4 versus forecasts for 65.5. This helped the bulls stabilize the chaos but trading continues to be choppy and volatile.
The Dow opened with a triple-digit loss and fell to 12,270 (- 120 points) before rebounding to off its lows to cut looses in half. However, the index is currently down 107 points to 12,283. We said to look for 12,200 to hold so if we retreat into the closing bell this will be the first level the bulls look to protect.
The S&P 500 is lower by 18 points at 1,325 and has traded down to 1,323 which is where to said the first level of support should come in at. There is further support at 1,300 which would make things interesting but let’s hope the bulls can hold 1,325 today.
The Nasdaq is showing a decline of 53 points and is at 2,780. The index has traded to a low of 2,779. We are looking for 2,700-2,750 to hold. Tech will be the most volatile on market swings but we expect the bullish trend to remain intact.
Turning to earnings, Wal-Mart Stores (WMT, $53.62, down $1.76) is down 3% after reporting a profit of $6.06 billion, or $1.70 a share, versus $4.76 billion, or $1.25 in the year ago period. Excluding items, Wal-Mart would have earned $1.34 a share. Revenue came in at $115.6 billion which was below expectations as sales for stores opened at least a year declined be nearly 2% and were lower for the seventh straight month.
Wall Street was looking for $1.31 a share on sales of $117.5 billion.
Looking ahead, Wal-Mart said it expects current quarter earnings of $0.91-$0.96 a share, and 2011 earnings of $4.35-$4.50 a share. Analysts are expecting profits of $0.96 a share and full-year profits of $4.45.
The news hasn’t been all that bad for our portfolio. Although some of our trades have taken slight hits today, others have done extremely well. We were stopped out of one trade for a gain of 83% after closing half a few weeks ago. This brings our 2011 track record to 14-out-of-16 winning trades. We also have another trade that has surged on silver’s move and is showing a triple-digit gain of 130%.
Subscribers, check the Members Area for the important trade updates.
