During today’s regular session the indices regained much of what they lost after last week’s jobs report. But the real story may be what took place in the after-hours session. Both Cisco (CSCO) and National Semiconductor (NSM) had disappointing earnings news. Here’s the effect they had on some stocks in the late session (via Briefing.com):
After Hours Summary: CSCO -6.0%, NSM -8.9% highlight after hours news
Companies moving in reaction to CSCO/NSM news: PMCS -8%, BRCM -5.7%, XLNX -5.4%, JNPR -5.2%, FDRY -4.6%, AMAT -2.1%.
The QQQ, which was at 33.42 at 4:00, closed at 33.02 in the after-hours session. So it looks like the bulk of today’s gains may be wiped out at the open tomorrow. It appeared that the market was working on a good bounce but now I’m not so sure.
On the oil front, I think it’s interesting to note how the stocks of the oil companies have broken their uptrends over the last week, while the commodity keeps making new highs. I’ve also noticed that gas prices here in Atlanta haven’t risen as high as they were when we had the last spike in oil several weeks ago. I don’t know what to make of those developments but they are interesting. Perhaps a sign of over-heated speculation in the commodity? Here’s a chart of Noble Energy(NBL):
Good eye on the interesting divergence between oil and gas. Certainly hoarding by over-zealous speculators explains some of the continued madness in oil prices. And I am sure many are using oil as a hedge to the lousy stock market. But also don’t forget that last week gasoline inventories took an interesting jump UP. This has apparently kept a lid on gasoline prices…for now anyway. If gas inventories continue to build, I would assume this is partially from waning demand with the weakening economy. Only a matter of time before a sharp and “painful” correction in oil occurs? It sure would be one contrarian of a move given all the recent calls for $50 and $100 barrels of oil!
I knew I could count on you to give me the fundamental story!
I thought there was a great sign of a top today (Tuesday) — CNBC added the price of oil to their on-screen ‘bug’. That has to kill the rally.
Looks like demand for oil has been surging. Forbes has a pretty decent piece looking at very specific elements of the oil story. (that Forbes article) That CNBC on-screen bug is definitely a classic rally killer. I guess a lot of the anchors must own SUVs! ;D