Say Goodbye To 2012

The market is mixed in early trading.  The market first ticked lower after the open, but quickly found its footing and regained a bid to move higher.  There appears to be some hopes that some sort of "deal" will be cobbled together today, but that remains to be seen. 

Senate Majority Leader Harry Reid said discussions are "progressing", and Congress will remain in session all day.  Senator Corker said that he thinks they'll get something done, but there likely won't be meaningful deficit reduction.  I agree that if anything gets done today, it will just be preliminary and meaningful details will still need to be worked out in January.

Asian markets were mixed overnight.  China led the action with a 1.6% gain after HSBC's final manufacturing PMI reading climbed to a 19-month high of 51.5.  Japan was closed for holiday.

Europe's markets are mixed.  France finished 0.6% higher after the French Supreme Court struck down a proposal for a 75% tax on citizens earnings over 1 million euros.  Germany was closed.

Other than that there isn't much going on today.  Everyone seems to be just sitting around waiting for the next headline out of Washington. What a terrible end to the year for the markets.  Investors don't like when the investment landscape is clouded with political uncertainty.  They would prefer a deal, any deal, so at least the economic impact can be quantified, price levels can adjust, and we can move on and figure out how to make money for our clients.

The 10-year yield is ticking higher to 1.73%.  And the VIX is dropping -8.5% back to 20.78 after a big spike on Friday up to the 23 level. 

Can someone please tell me how the volatility index can be down -8.5% and the inverse VIX etf (VIX) is down 1% and not up??  What a sham.

Trading comment: The market climbed the proverbial wall of worry in 2012.  There was a lot of economic uncertainty, Europe almost came completely unglued, the election provided lots of ups and downs, and a fiscal cliff deal was never struck.  All of that should have made for a pretty bad year for stocks, but the S&P 500 is poised to finish the year +11-12%.  Not too shabby.  And bonds did well also as interest rates continue to fade lower.  I don't think 2013 will see the same benign action.  I expect continued volatility, and think we could see another flare up in Europe as Spain's issues move to the front burner.  We have used the lift in the stock markets since November to continue to pare back equity exposure and get more conservative in our asset allocations.  I still think that is the prudent move heading into 2013.  If we do get a big pullback at some point in the first half of 2013, we would look to put money back to work in equities as that would probably be a good buying opportunity.  We shall see.

A happy, healthy, and prosperous New Year to all our readers!

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Stocks Lower Again As Deal Hopes Fade

The market is lower again in early trading as hopes for a deal to avoid the fiscal cliff fade.  The market did get a pop from its early lows when a headline came across that Obama was going to propose a new plan which would scale back budget plans and renew tax cuts for all but top earners.  But this headline isn't really new, and I suspect the positive reaction will fade.

Although the action has been negative lately as hopes for a deal fade, longer term it might work out better as whatever deal that gets reached will have had more time to hatch vs. a hastily slapped together deal.  We have also not heard anything about the debt ceiling expiring.

In economic news, pending home sales rose 1.7% in November.  Also, the Chicago PMI rose to 51.6 in December from 50.4 the prior month.

Asian markets were higher across the board overnight, led by a 1.2% gain in China.  But European markets are lower amid weak economic data.  French GDP was revised lower to 0.1% in Q3.  Spanish retail sales declined -7.8% yr/yr.  And Italy auctioned off 5- and 10-yr debt, but was only able to place 5.88 billion euros of the 6 billion target.  10-year notes garnered a yield of 4.48%, slightly above the November auction's yield of 4.45%. 

The dollar is up a little today, and most commodities are weak. Oil prices are a bit lower to $90.70, and gold prices are lower near $1656.  Silver and copper prices are lower as well.

The 10-year yield is flat near 1.71%.  And the volatility index (VIX) continues to creep higher, up 3.6% today to 20.18.   These are levels we haven't seen since July.  But at that time the market was starting to move higher. 

Trading comment:  The S&P 500 had a late rally yesterday to recapture its 50-day average.  It would have been a positive if the market could have built on that positive reversal and added to it today.  It's still early, so anything could happen, but so far the market is weak again and the SPX is falling back below that 50-day support.  Volume is also light on this Friday ahead of the New Year's weekend.  Although the market is open on Monday, many traders might just pack it in and take a long 4-day weekend. 

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Stocks Give Back December Gains

The market is lower again in early trading after Senator Harry Reid says it is unlikely they will get something done to avoid the fiscal cliff before year end.  Stocks ticked lower on this headline, despite the President making calls to all 4 key Congressional leaders to try to get updates.

In addition to the fiscal cliff talks, under the radar is the fact that Treasury Sec Geithner said the country's debt limit will again be hit by December 31st.  They sure didn't buy themselves much time last August when they raised the debt ceiling.  Dumb.

In economic news, the latest consumer confidence number for December ticked lower to 65.1 from last month's reading of 71.5.  November new home sales hit 377,000 which was below expectations but higher than the previous month's 361,000.

Asian markets were mostly higher overnight, led again by Japan which continues to talk about more serious stimulus measures.  This time they are even talking about buying foreign assets.  China lagged and finished -0.6% lower.  The S. Korean finance minister cut their growth forecast for 2013 from 4.0% to 3.0%.

Europe's markets are mixed this morning.  Germany's finance minister said the country's economy will expand at a "decent" pace next year.

The dollars is flattish this morning, as our most commodities.  Oil prices are flat near $90.90 and gold prices are near $1660.  Silver and copper prices are getting a little more of a bounce today. 

The 10-year yield is fading back to 1.71%.  And the volatility index is up another +4.5% near the 20.50 level, which it has not seen since July.

Trading comment: The S&P 500 is slipping below its 50-day support right now, which sits near 1412.  The Nasdaq is also below its 50-day today.  The price action today has also erased the December gains in the market, and with 2-days left of trading for 2012 we could see traders look to lock in profits as hopes of avoiding the fiscal cliff fade.  We have continued to counsel a cautious approach.  We realize that even if we miss the 12/31 deadline and a deal is reached soon after, the market would likely rally on the positive news.  But even a deal is likely to contain policies that are not going to stimulate the economy in the near-term and are more likely to dampen economic growth.  As such, we want to remain conservative for the intermediate-term.

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Deal Enthusiam Fading

The market had been running higher into last week on what seemed like optimism that Congress would get something done to avoid the fiscal cliff.  With 3 days left on the calendar in 2012, that optimism is fading into pessimism.  The market opened on a flat note this morning, but has since started to fade into negative territory.

So far, materials stocks are outperforming while consumer discretionary stocks are really lagging.  The early reports for holiday sales don't seem as robust as hoped for.  I heard that McDonald's was even urging franchisees to remain open for Christmas to help boost Q4 sales.

In economic news, the Case-Shiller Home Price Index rose 4.3% in October, a strong showing on top of the previous month's reading of 3.0%.

Asian markets were up across the board overnight.  Japan's new prime minister has promised unlimited money printing to end Japan's bout with deflation.  Japan led the action with a +1.5% gain. 

The dollar is lower vs. the euro and that is boosting commodities.  Gold prices are up only slightly near $1662, but oil prices are back above the $90 level near $90.77.

The 10-year yield is a little lower after last week's spike higher and trading near 1.74%. 

Volatility expectations are picking up with the VIX spiking +8.5% so far up to the 19.35 level.  The VIX has had a hard time maintaining these big spikes into the close.  Let's see if this early spike in volatility fades into the close today.

Trading comment: The Nasdaq 100 has fallen back below its 50-day average support.  And the S&P 500 is only 6 points away from testing its 50-day average.  It still feels to us like the time to be getting more conservative in our asset allocations.  The recent lift in the markets into mid-December may prove to be just a lift that offered investors better price levels to trim equities heading into the near year.  For us to be wrong, the markets would have to shoot higher as we enter 2013.  While anything is possible, we view the odds of such an outcome as relatively low given the headwinds and economic backdrop the market is facing.

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Volatility Spikes On Fiscal Cliff Delay

In case you have been on the moon the last 18 hours, House Speaker Boehner cancelled last night's vote on the "Plan B" idea for the fiscal cliff.  Global markets responded negatively to the news, and last night the Dow futures were down nearly 250 points.  Currently, the market has bounced a bit from the morning lows but the Dow is still down around 170 points as of this post. 

Hard to call this one ahead of the holiday weekend.  Either we see some short covering and the market rallies a bit from here, or folks throw in the towel and take off more risk heading into next week which would likely mean we close at the lows for the day.  Take your pick.

Boehner said he is not walking away from the debate with the President, but there are no more votes before Christmas, and then the window before year-end gets pretty narrow.  Hard to see how the wide gap we are at right now gets closed in that short of a time frame.

We got some more positive economic data this morning in the form of a good durable goods report.  Durable goods rose 0.7%, which was better than expected, but ex-transportation the figure rose +1.6% which is pretty strong.  And personal spending increased +0.3%.

Asian markets were all in the red last night after the Boehner news.  And Europe is lower this morning on the same news as well as some light economic data.

Commodities are mixed with precious metals higher and energy lower.  Gold is up a bit to $1654 while oil is trading lower near $88.37.

The 10-year yield is lower to 1.75%.  And the volatility index (VIX) is spiking 10% this morning up to the 19.40 level.  I've been saying that the market felt a bit complacent lately, so this morning's spike is not all that surprising given the news backdrop.  But the VIX hit levels this morning that it hasn't touched since July.

Trading comment: I am leaning toward this being a one-day plunge and that dip buyers will be back next week trying to squeeze some more profits out of the market into year-end.  I don't think that the market was really pinning its hopes on the "Plan B" anyway, so while last night's no vote is an incremental negative it really seems like just more of the same in the fiscal cliff debate.  I think bulls will come back next week on hopes that Congress and the President cobble something together before year-end.  I plan to nibble on some long trades into the close today. 

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Oracle Buys Eloqua: Expanding Marketing Footprint

Eloqua's Fit in the Oracle Application Portolio

Eloqua is being brought in as the 'centerpiece of the marketing cloud' solution within the broader Customer Experience Cloud offering.  The Customer Experience Cloud is Oracle's comprehensive go-to-market strategy for its CRM offerings that it introduced in mid-2012.  Additionally, Eloqua will be leveraged with integrations to Fusion CRM and ultimately extended into vertical offerings.  There is overlap with the previously acquired Market2Lead product in terms of campaign capabilities but Oracle spokesmen stated that Eloqua would be the primary product and Market2Lead would be integrated to it.

Market Reaction

First and foremost, Oracle is serious about its CRM business.   According to IDC market numbers, Oracle has led the worldwide CRM applications market since its purchase of Siebel, holding 11% of the market in the 2011 shares data.  However, both SAP and Salesforce.com are within two percentage points of that share fueling Oracle's motivation to maintain and increase the distance.  The current battle ground of competition within the CRM applications market is being fought in the marketing automation segment where, as this IDC Data Map shows, the traditional transactional vendors hold much smaller footprints.  

This acquisition immediately brings to mind the question, 'what will Salesforce.com do now?'  Not only was and is Eloqua a key partner of Salesforce's, the company relied on it and similar partners to provide this capability to its customer base.  Salesforce.com's acquisitions in the marketing arena to date have been focused on social marketing capabilities.  While Oracle was explicit in stating that the product, like the other components of its various applications offerings, is capable of being used in a heterogeneous environment, Salesforce.com won't be happy long sharing its customer base  Eloqua today, has a significant number of Salesforce.com customers in its base as well as Microsoft Dynamics CRM.  Marketo may become far more attractive to Salesforce.com as the new year begins.

Conclusion

Overall, the latest acquisition by Oracle signals a commitment to building a fully comprehensive product offering for its CRM business that covers all the major elements of the CRM applications market.  For Oracle the coming year will be one of bringing integrations and proof points to market.  For the other marketing automation vendors with broad marketing capabilities, specifically Adobe, IBM and SAS, there will be more of a trade-off for customer evaluating products between a CRM suite solution and best-of-breed. 

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Quick Take: Morning Look

Markets are roughly flat in early trading.  Yesterday the markets really tailed off at the end of the day and ended on a weak note.  It's interesting that there is usually at least one big down day during the week of options expiration, so maybe yesterday was that day.

I'm a little surprised the market didn't bounce more on some of the positive economic data we got.  That could indicate some more weakness later in the day.  And as we get closer to Friday volume levels should tail off as people leave to take a long holiday weekend.  The market is open for a half day on Monday, but lots of folks will simply take off and get in a 4-5 day weekend.

The final estimate of Q3 GDP came in much higher than expected at 3.1%.  That's pretty solid growth, but of course its a rear view mirror datapoint, and at this point we are really concerned with how 2013 GDP will come in.   Current estimates are for growth of 1.5% - 2.0% depending on how fiscal cliff talks effect spending and taxes.

The Philly Fed survey ticked up to +8.1 for December from a low -10.7 reading last month.  And existing home sales rose to 5.04 million units from 4.76 million the previous month.

Asian markets were mixed overnight, after the Bank of Japan upped its asset purchase program by another 10 trillion Yen.  European markets are also mixed this morning.

The dollar is higher and metals are getting hit hard.  Gold prices are lower by $27 to $1640.  Copper prices are down -2% on the day and silver prices are off by more than 4%.  Lots of selling pressure.

The 10-year yield is hovering near 1.79%.  And the VIX is flat at 17.40.

Trading comment: With more individual stocks showing positive action, its hard to want to fight the tape here.  I am no more confident that a grand bargain is reached regarding the fiscal cliff.  Most congressmen are getting ready to go home for the holiday.  So they will have less than a week to get something done when they get back.  That should make for interesting action in the market.  And I still wouldn't rule out a brief pop on any hastily crafted agreement combined with some can kicking provision to push things into 2013.  But as we enter 2013 we have been moving our asset allocations toward a more conservative posture.

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Climbing The Wall of Worry

I'm getting a late start today as I had to take the kids to school this morning, which cuts into market hours when you're on west coast time.  Unfortunately I am on drop-off duty for the rest of the week as well.  So my morning comments are likely to be truncated for the remainder of the week.

Stocks added to their weekly gains yesterday with a nice rally that came on rising volume.  No real progress has been made on the fiscal cliff talks, but the market continues to climb the proverbial wally of worry.  I remain concerned that we could either get a 'sell the news' reaction to some hastily crafted deal, or a sharper sell off if no deal is reached. 

The volatility index is popping 6% this morning to 16.52, so there are some traders who are expecting an increase in volatility in the market near-term. 

Two recent earnings reports from FedEx and Oracle (ORCL) are both being greeted with enthusiasm this morning as the stocks gapped higher.  Both beat earnings and revenue estimates, but in the case of FDX the company lowered next quarter's forecast.

Gold prices continue to pullback, and are now close to the 200-day moving average.  In this environment of printing money gold should continue to do well longer-term, but it doesn't go up in a straight line and these sort of pullbacks serve to shake out the weak holders.

Asian markets rose overnight led by a +2.4% spike in Japan.  China was flat.  And European markets are higher following an upbeat German business climate index reading.  Additionally, industrial production data in Spain and Italy both surpassed expectations.  The euro is higher again today.

The 10-year yield is pulling back from yesterday's spike, and sitting near the 1.80% level.

More stocks are starting to breakout, which adds to the notion of the market strengthening and continuing to climb the wall of worry.  But in this environment risk management remains important.

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Talks Stall, But Stocks Still Looking For 'Cliff' Agreement

Stocks rallied nicely yesterday, and so far today have been adding to those gains.  It seems a bit odd that Congressmen keep coming on TV to say that they are still a ways apart on the fiscal cliff stuff but the market continues to rally as if an agreement is imminent.

I think there are two things to keep in mind.  One is the potential for a 'buy the rumor, sell the news' type of event where the market rallies in anticipation but if a deal gets announced the market sells off.  The other is that not all agreements are created equal.  And if one is hastily reached that doesn't bode well for the economy longer-term, than any enthusiasm over a deal could be short-lived once reality sets in.  So careful what you wish for.

In economic news, the NAHB Housing Market Index for December rose to 47 from the prior month's reading of 45.

Shares of AAPL tried to bottom yesterday and are up again today.  A judge has rejected its injunction bid vs. Samsung, and Samsung will drop its lawsuits against AAPL in Europe.  Barron's also had a positive article on AAPL today.

Overnight Asian markets were mostly higher, led by a 1.0% pop in Japan to an 8-month high.  The Reserve Bank of India opted to hold its key interest rate steady at 8.00%.  In China, the govt. reportedly stated its GDP target for 2013 will be 7.5%.

The dollar is lower today, but commodities are mixed.  Gold prices are slightly weaker down to $1693.  Oil prices are higher near $87.88.  Silver and copper prices are weaker as well. 

The 10-year yield is rallying on fears about no fiscal cliff deal.  The yield reached 1.80% this morning, which is the highest level since late October.

As for the volatility index, it had a delayed reaction yesterday and really didn't start to decline until late in the day.  But today the VIX is dropping by a lot, down 5% so far near the 15.50 level. 

Trading comment:  I have said recently that we didn't want to fight the tape as it was likely the market would work its way higher as investors anticipated a deal on the fiscal cliff and as portfolio managers looked to put money to work to try to add some performance before year-end.  But big picture we have still been getting more conservative in our asset allocations as we feel that there is still some downside risk as we enter 2013.

KAM Advisors has long positions in AAPL

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Monday Morning Musings

The market is higher in early trading after the 2-day pullback seen at the end of last week.  I prefer a market that opens weak and ends strong, so let's see if the early gains can hold until the end of today's trading session.

The fiscal cliff talks continue.  House Speaker Boehner offered a tax hike for top earners (over $1M) if new revenue was met with spending cuts.  But the White House rejected  the offer, so even though discussions continue I'm not sure how much headway is being made.

In M&A news, Caribou Coffee (CBOU) is being acquired by a private equity firm for a 30% premium to Friday's close.

In economic news, the Empire Manuf. survey for December came in at -8.1, which is down from last month's reading of -5.2 and well below estimates.  It is not clear if the figure has been effected by Superstorm Sandy.

Overnight Asian markets were mixed.  China bounced +0.5% despite the new leadership there saying they may be more tolerant of slower growth.  This comes as the country is set to see its lowest growth rates since 1999.  The problem is that China needs the fast rates of growth to create millions of jobs required for all of the citizens moving to the cities from rural areas.

In Europe markets are generally lower this morning.  Germany's Bundesbank said the country's economy will suffer a notable contraction in Q4 and reiterated it sees the German economy growing at just 0.4% in 2013.

Apple (AAPL) is lower again this morning as it tests the $500 level.  Sometimes a stock needs a notable downgrade to bottom, and today it might have received it from Citigroup.  The analyst downgraded the stock to Neutral from Buy, but this downgrade comes just weeks after Citi initiated coverage of the stock with a Buy.  AAPL remains up +25% for the year. 

Commodities are mixed.  Gold prices are up fractionally to $1700.  Oil prices are higher near $87.50.  But silver and copper prices are lower.

The 10-year yield has held above its 50-day and is higher today to 1.72%.  It's nice to see that the 10-year yield is well above its July lows as folks start to question economic growth in 2013.

Trading comment: The market should be able to bounce here.  The S&P 500 just retested its 50-day average support, which is a logical technical level from which to bounce.  As of this post, AAPL is trying to bottom and rebound on the day.  If AAPL goes positive that would add fuel to the bulls' fire.  GOOG isn't being talked about at all, but its price action has been very solid. Today it is up another $13 to $715.  Not bad at all. 

KAM Advisors has long positions in AAPL and GOOG

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Looking For A Pause In The Action

The markets are mixed in early trading after yesterday's rally faded.  The Fed came thru with their version of QE4 as many had expected.  The markets, which were already up on the day, extended their rally a bit but as we headed into the close sellers emerged and stocks began to fade.  By the close the market had given up almost all of its gains.  This increases the likelihood that after a multi-day advance the market is due for a little breather.

In corp news, Best Buy (BBY) is bouncing again on news that founder Richard Shultz is expected to submit a bid to take the company private.  This rumor has been swirling for months, but this time around the CFO also just bought 100,000 shares.

CVS is also trading higher after raising its dividend as well as full-year guidance.  CIEN is also a bit higher despite missing earnings and issuing cautious Q1 guidance.

In economic news, November retail sales rose +0.3% vs. last month's -0.3% reading.  But excluding autos retail sales were unchanged.

Asian markets were mixed overnight.  China was -1.0% lower after an analyst at Commercial Bank of China suggested additional stimulus was unlikely due to rising property price concerns.

European markets are mostly lower after Eurozone ministers approved the next tranche of Greek aid for 49 billion euros through March 2013.  I'm sure in March we will be hearing about the "next" tranche of aid that needs to be approved.  What happens when Spain comes to the trough?

Commodities are mostly lower despite weakness in the dollar index again.  I would have thought more QE would be bullish for gold, but the yellow metal is lower today back below the $1700 level.  Silver and copper prices are also lower.  Oil prices are roughly flat near $86.76.

The 10-year yield is higher again up to 1.72%.  And the volatility index is flat near the 16 level.

Trading comment: Yesterday's downside reversal in the market usually portends further weakness in the near term as it represents some exhaustion among buyers.  I would look for a further pullback in the indexes, but the S&P 500 could find support at its 50-day average, which now sits near the 1415 level.  AAPL remains stuck in this trading range between 520-550, but GOOG is breaking above its 50-day average and could find some running room.

KAM Advisors has long positions in AAPL and GOOG

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More QE On The Way?

Markets are mixed in early trading in subdued volume ahead of today's FOMC announcement and Bernanke press conference.  The Fed's "Operation Twist" is set to expire so many expect a new program of bond buying to be announced today.  It is debatable if the market has been running more on expectations of more quantitative easing (QE) or hopes of a fiscal cliff agreement.

Folks should be careful about wishing for a hastily reached fiscal cliff agreement.  Although the markets might breath an initial sigh of relief, if the terms of the deal aren't favorable for economic growth I think it could make 2013 more problematic for the markets.

In corporate news, Wal-Mart (WMT) made cautious comments about the company's holiday sales.  Costco (COST) is higher after reporting solid earnings.  And Joy Global (JOY) is also higher after solid results but cautious guidance.

Asian markets were mostly higher overnight despite N. Korea launching a rocket over the Japanese island of Okinawa.  Japan resisted the urge to shoot down the rocket.  China was 0.4% higher after Nomura sees GDP growing 8.2% in 2013.

Europe's markets are also mostly higher ahead of our Fed meeting.  Greece's debt buyback was a partial success but the country was unable to reduce its debt by the full target amount.

The dollar index is lower which is helping commodities.  Oil prices are up to $86.35 and gold prices are higher near $1712. 

The 10-year yield is getting a boost to 1.67%.  And the volatility index is currently higher by 2.5% near the 16 level.

Trading comment: The SPX is currently higher for a 6th straight day.  Of course, the real action will start after the FOMC announcement.  It feels like more QE is already being priced in, and so any announcement of such wouldn't produce much of an upside surprise.  I also think the markets are expecting some positive news regarding a fiscal cliff agreement.  Since we are getting short-term overbought in the market, a pullback would not be surprising.  But the overall price action remains constructive and it is not out of the question that the markets have a shot a making a run at the September highs. 

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No Cliff Calamity: That's What Stocks Are Correctly Predicting

Despite all the media hullabaloo about the fiscal cliff and a potential recession if none of the Bush tax cuts are extended, stock markets have behaved calmly throughout this whole period. In fact, as of this writing today, the Dow is up 100 points.

I’m gonna guess that stocks, in their wisdom, are correctly sniffing that there will be no calamitous falling off the cliff. By that I mean there will be no $500 billion tax hike, which would be an economy killer.

Instead, after speaking with prominent Republican House and Senate members, I have come to believe the following: The GOP knows that Obama has the upper hand in this post-election battle. Therefore, they are preparing a strategic retreat.

Republicans don’t want to be the party of rich people and let Obama maintain his hold on the middle class. Republicans also don’t want to be the party of recession. So if no comprehensive deal is reached by President Obama and Speaker John Boehner, Republicans will not block an extension of the so-called middle-class tax cuts, which are roughly three quarters of the total.

It’s hard to know how this story will work itself out. There may be deals on upper-end tax rates, say 37 percent instead of 39.6 percent. And maybe even some lower tax penalties on capital gains and dividends.

Ideally, the GOP can get solid promises on spending cuts and entitlement reforms in return for a tax package. That tax package may include a dollar limit for tax deductions along with the rise in upper-end tax rates. Entitlement reform is also on the table. And so is a roughly $60 billion 2013 spending cut, which carries over from the across-the-board sequester. That is still possible.

But what is not possible is that House Republicans give up their constitutional prerogative to set the debt ceiling. That is their biggest point of leverage. And that leverage will carry over into 2013 as lawmakers once again attempt an across-the-board effort for pro-growth tax reform (flatter rates, broadening the base), serious structural entitlement reform, and more discretionary spending cuts. This will be the battle royale of next year.

As I said, no one knows how all this is going to play out in the next two weeks. But from the standpoint of the economy and the stock market, a worst-case tax-hike scenario that would sink GDP is not likely to happen.

There will be a deal to extend most of the tax cuts. And while higher tax rates on successful earners, small-business owners, and investors are most definitely not pro-growth, at least the across-the-board tax-hike calamity will be avoided.

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Bulls Get Back On The Offensive

The market is trading nicely higher this morning.  There hasn't been any huge catalyst to boost stocks this morning, so most likely it is just continued optimism that fiscal cliff won't be as bad as feared as well as a technical buy signal with SPX retaking its overhead 50-day average.

The Nasdaq is leading the action this morning, with the tech sector up 1.7% led by Apple.  AAPL is trying to put in a double bottom after three tests of the $520 level that held.  This morning its up $18 so far and trying to get back to $550.  A continued rally in AAPL will likely embolden the bulls as it remains a favorite among investors and as such is a pretty good proxy for sentiment.

In corporate news, Liberty Interactive (LINTA) bought a big stake in TripAdvisor (TRIP) for $62.50 a share, which is boosting the stock 7%.  Urban Outfitters (URBN) is up 6% after reporting strong sales.   And AIG is up 4% after confirming that the US Treasury will sell its remaining shares of AIG stock. 

Asian markets were mixed overnight.  China was down -0.4% after new loan data missed estimates.

European markets are generally higher this morning.  The FT is reporting that Italy's PM Monti is in talks with the centrist party who are encouraging him to stand in next election.  But the big boost came from the ZEW German Sentiment reading which came in well above expectations at 6.9 vs. estimates of -12.0.  It was also the first positive reading in 6 months.

The dollar index is lower today as the euro bounces.  Commodities are a bit heavy relative to stocks.  Gold prices are a touch lower to $1708.  Oil prices are also a little weaker near $85.39.  And silver and copper prices are lower as well.

The 10-year yield is getting a boost to 1.65%.  And the volatility index is sliding more than 3% back down to the 15.50 level. 

Trading comment: The other day I commented that the recent price action in the S&P 500 was setting up for another test of the 50-day average and that I didn't want to fight the price action.  Yesterday the SPX closed above its 50-day for a second day, and today we are seeing the big spike above that key moving average.  Moreover, all of the major indexes have now recaptured their respective 50-day averages.  That is a positive technical sign and likely has increased the confidence of the bulls to put money to work on the long side.  I still worry about the inability of any grand compromise on the fiscal cliff, but as they say-- don't fight the tape.

KAM Advisors has long positions in AAPL

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#CMOFact: IDC 2013 Marketing Investment Planner

With 2012 coming to an end, for many businesses planning for 2013 will bleed into the New Year. Marketers are no exception; in anticipation of the planning cycle each year, the CMO Advisory Service publishes our annual Marketing Planner in August/September, developing the B2B tech industry's leading marketing (and sales) benchmarking study. To anyone familiar with the industry, you are probably used to hearing that Marketing is transforming. What is so exciting about our Marketing Planner is we are able to provide specific guidance on changes, challenges, and successes within the industry through incredibly accurate industry data and qualitative information provided by you, the senior marketers. Marketers in turn are able to use this information to successfully plan for the upcoming year.

I’ve taken the liberty of pulling out some key facts below from our report that are particularly interesting or useful. Feel free to share them and remember to follow me on twitteror check out the CMOFact hashtag - we will continue to share some marketing goodness there.

#CMOFact Number 1:  In 2012 the average large B2B Marketing organization is in receipt of a 1.7% budget increase. This is 50% LESS than the 2011 rate.

#CMOFact Number 2:  The Marketing Budget Ratio for B2B tech companies has declined each year from 2009 through 2012. Marketing Investment is not keeping up with revenue growth.

#CMOFact Number 3: B2B Tech CMOs are spending approximately 30% of their budget on digital marketing programs. This is up from 12% in 2009. 

#CMOFact Number 4: For Large Tech Companies, only those in Software (vs Services & Hardware) are receiving increased budgets!

#CMOFact Number 5: The marketing automation train is picking up speed, and fast. Jump on now or prepare to be left behind. This is a new category in our survey and is already at 3.1% of programs budget and 1.6% of staff allocations.

These are just 5 nuggets from the 2013 Marketing Planner. The full version includes a complete overview of the current state of the B2B Tech Marketing it includes; program spend, staffing breakdowns, up and coming technology, and forward looking advice. For your own copy, reach out to Wendy Pemberton at wpemberton@idc.comor find it here. 

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Monday Morning Musings

Markets are slightly higher in early trading, led by healthcare stocks while financials are lagging so far.

Food stocks are getting a bounce after McDonalds (MCD) posted a better than expected +2.4% increase in global same store sales.  Expedia (EXPE) is lower after being the latest company to report a special dividend.  Normally a stock pops higher on this news.

In M&A news, Intermec (IN) is 22% higher after being acquired by Honeywell (HON) for $10 per share.  And Nexen (NXY) is 15% higher after getting Canadian approval  for the merger with Cnooc of China.

Apple (AAPL) was lower again in early trading but has since reversed off its lows and is inching its way back into positive territory, currently trading near $535.

Overnight Asian markets were mixed.  China outperformed with a 1.1% gain.  But Japan posted GDP contraction of -0.9%, marking its second quarter of contraction which puts it back in an official recession.

European markets are lower this morning after Italian PM Mario Monti announced his intention to resign.  Former PM Berlusconi has thrown his hat back in the ring to run again.

The dollar is up slightly, but not hurting commodities so far.  Oil prices are bouncing near $86.45.  Gold prices are higher to $1715.  And copper prices are higher as well.

The 10-year yield is a bit lower to 1.61%.  And the volatility index is higher by 2% so far near 16.20.

Trading comment: The S&P 500 is inching its way back above its overhead 50-day average.  We have been watching this key technical development, as it usually signals improved bullish sentiment among traders.  It seems odd to watch the market climb as we have all of this fiscal cliff discord in the headlines, but I guess that is the proverbial wall of worry that markets like to climb.  At least that is the case right now.  We still would not rule out the occurrence of a large selloff if and when markets get confirmation that no major deal has been reached and we begin to quantify what effects higher taxes, etc. will have on economic growth.  But for now the market is in the Alfred E. Newman mode of 'what - me worry?'

KAM Advisors has long positions in AAPL

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Customer Focus All Ways.

A retail chain revamps its design and there is much back-slapping and pronouncement.

Sarah Doyle, marketing director of Eat says, "We are very excited to be unveiling EAT.’s new look which we feel reflects the core principles on which our brand was originally founded. It is modern and stylish, yet also has a natural, simple and handcrafted feel, which reflects the essence of our food. The new design marks the start of a new stage of growth and expansion for the business."

All very nice, but there's no mention there of improved service or better customer experience. Indeed, there's virtually no mention of the customer at all and even though this is taken from a design magazine, I think that's unforgiveable.

Blinkered broadcasting isn't limited to advertising and if you're not mentioning your customer front and centre, then you run the risk of appearing to belong to the old school of marketing by message. You also run the risk of forgetting what your job is.

Addendum: That said, I do think it's a little harsh of the article to refer to "The new Strand flagship store, with inferiors by Stiff and Trevillion."

They're not that bad.

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Surprise Slowdown In Germany

Nonfarm payrolls for November came in nicely ahead of consensus estimates, but the enthusiasm among stock buyers was short-lived and the market was back at the flat line in the first hour of trading. 

Payrolls gained 146,000 last month vs. estimates for 90,000.  Also surprisingly the unemployment rate dropped to 7.7% from 7.9% last month.  I haven't parsed the figures but my guess is much of that decline is due to a continued drop in the labor force.  I haven't seen any big hiring announcements in the news, other than temporary workers for Christmas.

Asian markets were mixed to lower overnight.  After the close in Japan, a 7.3 magnitude earthquake shook the northeast.  But no major damage reports have surfaced.  The Philippines are still dealing with the cleanup efforts following a deadly typhoon this week.  China was the one Asian market to bounce +1.6% last night, after a former PBOC advisor said he expects 2013 GDP to bounce back to 8.0%.

European markets were lower before the US payrolls data came out, which helped put a bid under shares and lift markets off their lows.  Germany's Bundesbank came out with projections that 2013 GDP will slow to 0.4%.  That is a big downward revision from the 1.6% rate forecast in June.  The bank also warned of a possible recession.  A big slowdown in Germany and France would not be good for the bailout programs the ECB and IMF are trying to implement.  Germany and France are the biggest backers of said programs, and already the credit ratings of the ESM have been downgraded.

The dollar is higher and commodities are mixed.  Oil prices are roughly flat near $86.35.  Gold prices were lower earlier this morning, but have since bounced back above the $1700 level to $1705.  Copper prices are higher as well.

The 10-year yield got a little lift from the jobs report and is higher to 1.62%.  The VIX is a little lower again near the 16.25 level. 

Trading comment: Yesterday I commented that the sideways consolidation in the S&P 500 Index put it in better shape for another stab at breaking above its 50-day average.  This morning's early pop on the NFP news accomplished that feat, but the ensuing fade has put the senior index back below its key overhead moving average.  We are in a real push and pull market, but we still have some time before the close today.  The 50-day average resides around SPX 1417, so we are only about 5 points away right now.  If we don't have too weak of a close this afternoon, I do think we could see some further upside next week.  Boehner's comments on the fiscal cliff certainly did not inspire confidence this morning, so I'm not sure I want to get too bullish even if we do see an upside breakout.  But for those looking for higher prices to do any selling or rebalancing it is worth paying attention to the recent price action.

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Start Making Sense.

So, British Airways serve in-flight croissants. It's hardly a deal-clincher is it? And not just because we all know what fast-food croissants inevitably taste like. But when they go on to describe a light breakfast in such ridiculously overblown and patronising language, you have to wonder if they got the memo about treating customers as sentient human beings.

Guilt-free friend indeed. Too fly to serve more like.

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All Eyes On Apple

The market was lower in early trading but has since bounced back into positive territory.  The Nasdaq lagged yesterday mostly due to the weak performance in AAPL shares.  AAPL has captivated investors interest lately, as many wonder if the stock is "done"?

I think that AAPL is just going through a normal correction after a huge run.  No one points out the fact that AAPL was up roughly 75% for the year in September, which is a huge move.  It has also become heavily owned by hedge funds, so the selling and angst over this pullback is not all that surprising.  All great stocks go through corrections, and I don't think AAPL should be sold yet.  Today the stock bottomed near its November lows and has so far bounced strongly from those levels.  It also looks like it is taking the market higher along with it.

Asian markets were mixed overnight.  Japan closed higher at a 7-month high.  And a Chinese state economist suggested that the economy is stabilizing but he doesn't see a V-shaped recovery.

In Europe, S&P cut Greece's debt rating to 'Select Default'.  The ECB and BoE held rates steady.  ECB Pres Draghi said they have lowered their forecast for growth as downside risks remain.  Q3 GDP for the Eurozone was in-line at a -0.1% contraction.

In corporate news, Safeway (SWY) is the latest company to approve an acceleration of its dividend to avoid the rise in dividend tax rates expected next year.  The stock has bounced +6% on the news.  I think AAPL should do a $20 special dividend.

The dollar is higher and having a mixed effect on commodities.  Oil prices are lower near the $86 level, but gold prices are bouncing back to the $1700 level.  Copper and silver prices are higher as well.

The 10-year yield remains weak at 1.57%.  And the VIX was higher in early trade but has since faded back to the 16.45 level, flat on the day so far.

Trading comment: All eyes remain on AAPL, which seems to be having an outsized effect on trader sentiment.  AAPL is rallying today, and if it can continue to rally it should help lift the market.  Yesterday the market had staged a strong upside reversal, but some very late selling took some steam out of the strong technical action.  Overall it was still a solid bounce from the earlier lows and if the market can hang on to these early gains I think it puts the SPX in a stronger position to make a successful attempt at rallying back above its 50-day moving average.  That would likely embolden the bulls to do a little more buying.  That said, I do find this action in the market somewhat surprising given I have little confidence in any grand resolution before year-end regarding the fiscal cliff.  But I don't want to completely ignore the price action.

KAM Advisors has long positions in AAPL

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NEW Special Report: State of the Painting Industry

We are gearing up for a great 2013.  LOTS of painting business marketing tips and business growth advice to share.

For now head over to www.StartAPaintingBusiness.com and take advantage of the December discount price on the #1 Rater Painting for Profits program.  (It will become your step-by-step internal operations manual.)

I'm in the process of finishing up a brand new special report called: "2013 The State of the Painting Industry... " Insider Strategies for Positioning Your Painting Business at the TOP of Your Market.

I'll post a link on this blog when it's ready. 

For now, relax and enjoy the Holiday Season!

Andy

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Brand Strategy Reminders, Regardless of the Size of Your Company

There was something for everyone at MassTLC's recent marketing seminar - "On Brand: What Does it Take?"; if you're building a brand at a $1B+ company like PTC, or fighting your way up the ladder at a smaller company like Actifio or Verivo Software. Here are some of my keys take-aways:

1.  Something for everyone to learn (or to be reminded of)

• You need buy-in from executives:  The CEO and his/her team need to admit that there's a problem with your brand strategy, and they're on-board to fix it.
• Be realistic about the costs involved in branding:
• "The rule of thumb that we used was 2.5X the cost of our marketing investment over a 5 year period."[Jill St. George, PTC]
• Brand investment is even more critical today with the more mature Buyer 2.0. IDC recommends 50% of all marketing investment be spend on awareness building.
• Launch activities will touch many aspects of your customer creation process (e.g., collateral, web site, presentations, videos, training)
• Set targets for your branding effort
• "Prior to our rebranding effort, only 40% of our company understood our brand.  Our target penetration is 75%."[PTC]
• "# analyst briefings, web site activity metrics, social metrics"[Parna Sarkar-Basu, Verivo]
• "increase in revenue per sales rep, time to rep. productivity, # and quality of inbound leads"[Michael Troiano, Acitifio]
• Don't forget about the importance of keeping sales in the equation!
• "Stay close to sales!  They can make or break you." [Actifio]
• Include sales executives and sales operations on your team
• Tell it with stories:  Nothing speaks louder or sticks with influencers and buyers more than a good, relevant story.  Drop the MBA speak and industry terminology that all of your competitors have, and capture the essence of your company and value it provides in a story.  And most importantly, get your entire organization to communicate these stories. 

2.  Large companies

• Strive to be a "branded house" and not a "house of brands":  As Jill St. George from PTC pointed out, managing a company with many disparate brands can be significantly more costly than having a single, corporate brand.  And certainly let's not forget the confusion that a house of brands brings to your sales teams and customers as you're attempting to expand your market share and share of wallet at specific customers.
• Leverage your resources: PTC outsourced much of their brand strategy and design work (e.g., customer and employee interviews, surveys, design work) to Lippincott.  A smart move for any large company in order to rapidly leverage resources versus trying to support this type of significant effort internally, not to mention the expertise that can be attained by working with this type of firm.
• Align your branding strategy with your sales enablement strategy: Particularly in large organizations, your key to success will be rolling out a 1 to many strategy, and your sales enablement team(s) in marketing and sales can help here.

3.  Small companies

• Time is of the essence!  The good news is that you don't have as much to do as a larger company in rebranding your organization.  The bad news is that you don't have as much time or resources to accomplish your goals.  Think "months", not "years".
• Stay connected at the hip with your sales team:  Go on sales calls with the reps, if they like it or not. Test out your ideas, messages and stories with different folks on the sales team.
• Align your metrics with the company's and sales' targets. There's little time, resources or patience for brand studies, brand awareness metrics or market share analyses at a small company.  Hard line your team's metrics into sales productivity, sales pipeline and revenue targets.

Please share your thoughts below, or email me at Michael Gerard.

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New Party In China Promises Reforms

Our markets are lower again in early trading.  Traders are selling shares of AAPL which seems to be weighing on the Nasdaq the most.  One brokerage firm raised margin requirements on AAPL, but that doesn't seem to account for this much weakness.  AAPL has been down nearly 5% this morning.  I think the technical action in AAPL is not that out of the ordinary and would be a better buyer on the weakness vs. seller.

Asian markets were higher across the board overnight after China's new political party promised more economic reforms.  They indicate plans to invest in more urbanization and infrastructure as well as allowing insurance companies to invest in banks.  This helped China's stock market spike 2.9% and Hong Kong to rally +2.2%.  In other news, Australia said Q3 GDP rose +0.5%.

Europe's markets are generally higher despite another round of weak PMI Services readings.  Germany and Spain beat expectations while France  and Italy lagged.  Overall the Eurozone Services PMI came in at 46.7, which marks further contraction.  Only the UK reported a PMI reading above 50.0.

In the US, the ISM Services index was 54.7, ahead of estimates.  The ADP Employment report showed the private sector added 118,000 jobs in November, and this number was said to be hurt by Superstorm Sandy.  Last, nonfarm productivity showed an increase of 2.9% while unit labor costs fell by -1.9%, so those are both good trends.

In corporate news, Freeport (FCX) is buying both McMoRan Exploration (MMR) and Plains Exploration (PXP) in transactions totalling $20 billion.  But investors don't seem to like the foray into oil for this big copper producer as FCX shares are down -14% on the news.

Citi (C) announced plans to cut costs and improve efficiencies which will also entail laying off 11,000 employees.  Its stock is rallying 5% on the news. 

The dollar is bouncing a bit which isn't helping commodities.  Gold has fallen below the $1700 level to $1690.  And oil prices are lower near $87.80.

The 10-year yield has slipped lower to 1.58%.  And the VIX was higher earlier but has since moved lower on the day down to the 16.70 level.

Trading comment: We talked about expecting a pullback once the SPX reached its overhead 50-day average.  That is exactly how things have played out so far this week.  Currently the SPX is back in neutral territory basically right in the middle of the range between its overhead 50-day average and its underlying 200-day average.  This push and pull should continue with the same political backdrop of fiscal cliff rhetoric and negotiations.  I don't see how the market makes much headway under this scenario.  But the market has been defying the bears and climbing the wall of worry most of the year, so nothing would really surprise us at the moment.  We are staying conservative and not making any big bets before year-end.

KAM Advisors has long positions in AAPL

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Stalling At Resistance

Some of the major indexes ran into their overhead 50-day averages yesterday and were turned away.  The S&P 500 reversed lower and basically closed at its lows for the day.  That made for an outside reversal day to the downside, which often indicates some further near-term weakness.

Overnight, Asian markets were mostly lower.  The Reserve Bank of Australia lowered its key interest rate 25 basis points to 3.00%.  I'm not sure the RBA would have cut rates again if it thought China has bottomed, but the move did little to boost investor sentiment.  China actually bounced overnight, but is still trading near 4-yr lows.

Europe's markets are slightly higher today.  Sentiment seems to be improving following some progress made on Greek's bond restructuring.  That has also helped lift the euro higher vs. the dollar.

Despite the dollar weakness today, most commodities are lower.  Gold prices have fallen back to the $1700 level and are trying to stabilize.  Oil prices are lower near $88.  But copper prices are higher so far.

In earnings news, DRI is lower after reporting earnings and lowering guidance.  AZO and MTN are also lower on earnings, while TOL is bouncing after beating on revenues.

The 10-year yield is slightly lower to 1.60%.  This level or zone has pretty much acted as a floor for the 10-yr yield for the last 4 months. 

The volatility index (VIX) is breaking above its 50-day average to the 16.90 level.  We got close to the 20 level in October, but haven't actually seen a 20-handle on the VIX since July.  It would be a little uncharacteristic to see the VIX spike that much in December, which is not the highest of volatility months, but that doesn't mean it couldn't happen.

Trading comment: Lots of tests of overhead resistance.  I mentioned the SPX in the opening paragraph.  But the Nasdaq 100 also bounced from its overhead 50-day and is already back below its 200-day average, as they were pretty close together.  Another stock struggling with resistance is AAPL, which has been hovering near the underside of its 200-day average for the last week.  But yesterday it failed to get above the 200-day (near 596) and today is moving lower again.  AAPL isn't the market leader it was earlier in the year, but if it does regain its footing it would help improve investor sentiment seeing as it is still a very heavily owned stock and a favorite of investors.

KAM Advisors has long positions in AAPL

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Jual Ulat Kandang (Ulat Super Balap)

Berbagai macam pakan yang dapat menunjang performa dan kesehatan pada burung kicauan, salah satunya yaitu Ulat Kandang atau Ulat Balap. Bentuk fisik ulat kandang lebih kecil  dari ulat hongkong dan warna kulitnya berwarna coklat. Bagi anda yang membutuhkan ulat kandang baik untuk pakan burung anda ataupun untuk dijual di toko pakan anda, maka dengan ini kami menyediakan ulat kandang dengan jumlah yang sangat besar.

Rincian harga adalah sebagai berikut :

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Menerima pesanan hubungi langsung :
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Sekian dulu informasi jual ulat kandangnya, semoga bisa bermanfaat...

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Monday Morning Musings

Back in the saddle after being out of the office at the end of last week.  The markets finished the week on a slightly positive note in that the gains from earlier in the week held.  Now we have the tests of the overhead 50-day averages to deal with.

This morning the markets were higher in the first hour of trading, but have faded a bit after the first test of their 50-day averages.  There also hasn't been a lot in the way of market moving news.

Some of the wind behind the gains faded after the November ISM data came in worse than expected at 49.5, which is also well below October's reading of 51.7 and points to contraction in the manufacturing index.

Lots of other countries released their PMI manufacturing data as well.  China said its PMI rose to 50.6, which is a 7-month high for that reading.  The HSBC private PMI figure came in at 50.5, so these two gauges are now closer to each other.  Despite the data, China's stock market fell -1.0%.

In Europe, France's PMI was 44.5 and Spain was 45.3.  Both readings are still in the zone that markets contraction.  Spain's PM said it will be difficult to hit their projected debt target of 6.3% of GDP, and they would seek aid if needed.  Meanwhile, Moody's downgraded the ratings for both the ESM and the EFSF and maintained a negative outlook due to the credit deterioration of the program's large contributors-- namely France.

Commodities are mostly higher as the dollar trades lower today. Oil prices are higher to $89.62 and gold prices are up a bit to $1718. 

The 10-year yield is higher to 1.63%.  And the VIX is up +3% near 16.35, right at its 50-day average.

Trading comment: Last week I talked about the SPX trading right in the middle of its 50-day and 200-day averages.  Last Wednesday the SPX tested its lower 200-day support and successfully bounced off of it.  That put the senior index in position to rally to its overhead 50-day, which it has already bounced from this morning.  Usually the first test of a key overhead resistance level is not successful.  More often we see some sideways consolidation first.  As such, I would expect to see the market chop around a little in the near-term before any successful break above its 50-day average.  A successful break above said 50-day would likely also embolden the bulls and hedgies to put more money to work on the long side of the market.

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Stocks Ride The Political Roller Coaster

Yesterday the market was rallying on perceptions that progress was being made on the fiscal cliff.  Then Harry Reid came on tv and said the sides are still far apart.  That caused a market swoon right away.  This morning the markets opened very weak but then Boehner spoke with more comments about being flexible on tax rates and the market rallied a quick 100 points.

That is a huge amount of volatility on just political rhetoric.  But I don't think it is going away in the short-term.  I expect a lot more back and forth and political posturing that will continue to sway market sentiment in short bursts.  But we have yet to see any concrete progress other than words.

My guess is as time goes on the swings in the market will be less pronounced, but it does seem like we are going to continue to see the market rally on fiscal cliff hopes and decline on worries that nothing will actually get done before the deadline.  I am on record as saying that I think the best case will be a couple of items get addressed before 12/31 but the majority of the Bush tax cuts simply get extended until 2013 to kick the can down the road and give Congress more time.

Asian markets were lower overnight on concerns about US fiscal cliff.  China fell to a 46-month low.  A Japanese PM candidate suggested the country should employ unlimited money printing.  But at least someone is Asia is seeing a pickup in economic growth-- the Philippines saw Q3 GDP surge +7.1%, above estimates.

Europes markets are also lower this morning.  Spanish retail sales fell -9.7%.  And Eurozone private loans decreased 0.7%.

In corporate news, Costco (COST) is higher after reporting good same-store sales and declaring a special cash dividend of $7.00.  Analysts expect more companies with excess cash on their balance sheets to also declare special dividends.

Commodities are taking it on the chin today.  Gold prices fell close to the $1700 level and have started to bounce a bit.  And oil prices fell below the $86 level before but are also off their earlier lows.  Copper and silver prices are lower as well.

Trading comment: We mentioned the SPX in neutral territory between its key 50-day and 200-day averages.  This morning's selloff took the SPX down within 1 point of its 200-day support-- which is close enough for govt work.  Right on cue, buyers stepped in and the market began to bounce (aided by Boehner's comments).  But it supports the notion we laid out earlier this week that the 200-day could come into play if the market pulled back.  It's hard to forecast market direction short-term when so much sentiment is being swayed by political commentary, but that is the reality of things for the next few weeks.

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The Low ROI Of Narcissists.

I've long been a sceptic of the value of Facebook Likes and Twitter retweets as measures of anything but the narcissism of the people clicking on the butons.

It's largely been a gut-feeling that's occasionally backed up by anecdotal evidence. Take, for example, the experience of the well-known blogger who was delighted to receive a huge number of retweets of his tweet announcing a new blogpost and slightly less delighted to realize later that those retweets outnumbered the aggregate number of page-views the post received in the following week.

So, I was very pleased to see that we now have a statistial analysis that showed that 16% of 2.7 million studied tweets followed the same pattern.

Meanwhile, over at Facebook, the fact that Mitt Romney has lost 100,000 of his 12 million Likes in the past two weeks doesn't mean that the GOP vote has collapsed in the same time. It's not about him, it's not about voting intentions, it's about Facebook users not wanting to be associated with a losing candidate.

 But where something is measurable (or at least countable), there will always be interested parties eager to asign their meaning to that which they've counted. As ever, make sure you understand what's being measured and, more importantly, why.

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Do Stocks Have More Gas Left In The Tank?

The market is mixed to lower in early trading, with the first early dip attracting buyers.  Yesterday the S&P 500 was down as much as 12 points but rallied back late in the day to close down only 3 points.  That's not too much of a give back following the outsized gains from Thanksgiving week.  The question is do stocks have any gas left in the tank? 

If the market was in a more bearish mode, we would have seen a bigger pullback already from last week's gains.  But the action so far looks more like consolidation.  If this can continue then it would normally point to another push to the upside for stocks.  Stay tuned.

In economic news, the latest consumer confidence reading for November came in at 73.7, up from 72.2 last month.  The Housing Price Index for September increased 1.1%.  And the Case-Shiller home price index rose by 3.0%.  Also, durable goods were unchanged for October, but rose +1.5% ex-transportation.  Both of these were better than expected.

In corporate news, ConAgra (CAG) will acquire Ralcorp (RAH) for $90 per share, a 28% premium to yesterday's closing price.

Asian markets were mostly higher overnight on new out of Europe.  But China failed to rally and fell -1.3% below the 2000 level for the Shanghai Index.  That marks the lowest levels seen in that index since January 2009.

Europe's markets are higher this morning after the EU and IMF were able to agree on Greece.  Greece will receive 34.4 billion euros in December, and its debt-to-gdp is targeted to fall to 120% by 2020.

Commodities are mostly lower as the dollar index gains for a second day.  Oil prices have eased back to $87.16 and gold prices are lower near $1744.  Copper and silver prices are lower also.

The 10-year yield is lower to 1.65%.  And the volatility index remains below its 50-day average near the 15.25 level.

Trading comment: The S&P 500 is still kind of in neutral territory between its 50-day and 200-day averages.   The more sideways consolidation it can muster the greater the likelihood of another push to the upside.  But for our balanced accounts we would be looking to trim equity exposures a bit more on a push towards the SPX 1420 level.  We still think that the uncertainty surrounding fiscal cliff progress coupled with a slowdown in economic growth and corporate profits is likely to weigh on stocks in the intermediate-term and want to reflect this concern in our asset allocations.

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Monday Morning Musings

After one of the best weeks for the market last week, stocks are pulling back in early trade this morning.  The market had become quite oversold coming into last week, so a bounce was not unexpected.  But now that we have seen a big bouce, we will have to see if more profit taking sets in or if buyers will look to add more stocks into month end which occurs this week.

There is not much market moving economic news this morning.  In corporate news, AAPL is bouncing after a Citi upgrade and a $675 price target.  Facebook (FB) is also spiking +8% after receiving a pair of upgrades and bullish comments about its upcoming quarter.

On the downside, DreamWorks (DWA) is down -5% after "Rise of the Guardians" disappointed with $32.4 million in box office sales this weekend.  That's too bad.  I took my kids to see it yesteday and we all liked it.

Retail stocks are mostly lower this weekend on mixed sentiment over Black Friday sales.  Utilities are bucking the early weakness and boucing after the drubbing the sector has experienced since Superstorm Sandy.

Asian markets were mixed to lower overnight as traders remained cautious ahead of another EU finance ministers meeting in Brussels today.  Morgan Stanley put a note out that it expects China's GDP to grow 8.2% in 2013.

Europe is lower this morning amid chatter that finance ministers are considering a haircut for Greek bondholders that could reduce the country's debt-to-GDP ratio to 70% by 2015, down from 120%.  Seems like a big haircut that might be hard to push through.

Commodities are lower as the dollar index remains in positive territory.  Oil prices are pulling back to $87.67 and gold prices are a tad lower near $1749.  Silver and copper prices are also slightly lower.

The 10-year yield is down to 1.64%.  It was unable to break above its 50-day resistance near 1.70% last week.

The volatility index is 4% higher this morning to 15.77, still a relatively lower absolute level.

Trading comment: The S&P 500 is now right in the middle of the range between its overhead 50-day and its 200-day support.  We sold half of our trading ETFs last week, and will likely exit the rest today.  If the bulls are ready to do more buying into month end this week, then I could see the SPX testing the underside of its 50-day near 1425.  But if this selling continues and it looks like traders are reducing equity exposure again then we could be back at the 200-day in a hurry.  The 200-day currently sits near 1383.  I think another test of the 200-day could set up a bounce but at SPX 1400 right now I think the market is in neutral territory.

KAM Advisors has long positions in AAPL, FB

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US Stocks Open Flat Despite Overnight Bounce in Asia

US stock markets are hovering near the flat line in early trading.  There hasn't been too much news, and I would expect that trading today would be relatively light ahead of the Thanksgiving holiday.  On Friday the market will only be open a half day.

In economic news, the Univ of Mich consumer sentiment survey for November slid to 82.7 from its preliminary reading of 84.9.  The latest weekly jobless claims figures totaled 410,000 which is down from last week's total of 451,000.

Overnight Asian markets rallied despite some weak Japan trade figures.  The latest traded data from Japan showed exports from Japan to China fell -11.6% and exports to Europe slumped -20.1%.

European markets are mixed to lower today after a bit of delay between the EU and IMF on agreeing to release the next tranche of aid to Greece.

In the Middle East, talks yesterday of a cease fire appear to be a bit premature as fighting continues.  a bus bomb exploded in Tel Aviv this morning killing 21 people.

Commodities are mixed as the dollar is relatively flat.  Oil prices are up a bit to $87.45 and gold prices are also a touch higher near $1725.  Copper prices are more than 1% lower on the day.

The 10-year yield is up again to 1.68%.  Its overhead 50-day resistance comes into play around 1.70%.  And the VIX is down fractionally below the 15 level. 

Trading comment: The market bent a little yesterday but was able to bounce back into the close and end in positive territory.  So far the pattern of consolidation after the strong 2-day rally looks normal.  But I would like to see the market push through to some more upside soon to keep these rally hopes alive.  I still feel like sentiment is fragile at this juncture and if the bulls don't keep their pedal on the gas this market could roll over again.  Volume levels today and Friday should be light and hopefully the bears have left early for their holiday festivities.

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Are Stocks Catching Their Breath After Monday's Rally?

The markets are roughly flat in early trading following yesterday's solid rally.  Stocks rallied both Friday and Monday, so its rational for them to take a breather.  The question for investors is whether stocks are just catching their breath before another push to the upside or if the last 2 day rally was just a breather from the recent downtrend action?  I think the markets still have some more upside, though I don't see us getting back to the highs of the year.

This morning both BBY and HPQ are making new lows after reporting disappointing earnings.  BBY has lost all of its mojo that was surrounding the prospect of its founder taking the company private.  And HPQ took a huge charge related to improprieties and misrepresentations from Autonomy which it bought.

In economic news, housing starts rose to 894,000 units in October from 863,000 last month.

Overnight Asian markets were mixed, although China slid 0.4% hitting a new 45-month low.  That can't be a good sign.  I'm surprised the media doesn't mention this more whenever they are talking about secular growth theme in China.

European markets are also mixed despite the Moody's downgrade of France.  Moody's also mentioned the outlook for Italy's banking system remains negative.  In Brussels, EU finance ministers have agreed in principle to unfreeze loans to Greece.

Commodities are mostly lower following a rise in the dollar today.  Gold prices are near $1730.  Oil prices are pulling back to $87.50, down almost $2 as news hits the wires about a ceasefire from Israel.

The 10-year yield is up to 1.65%.  And the VIX is up fractionally to 15.38 after a big drop yesterday.

Trading comment: I still like the long side here for a trade.  We added some long ETFs in trading accounts and haven't sold them yet.  For our balanced accounts, we still want to stay defensive and reduce our equity exposures as we near year-end.  So for longer-term investors we are using any further strength in the market to continue to rebalance portfolios with an eye toward the fiscal cliff uncertainty and a continued slow growth economy as we enter 2013.

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Monday Morning Musings

The markets are nicely higher in early trading, with the Dow up 150 points following strength on Friday's close and rallies in overseas markets last night and this morning.

Israel has said it may increase its assault on the Gaza strip, and that has oil rallying another $2 to $89.  But that has not derailed the rally in stocks so far this morning.  One thing that concerns me a bit is that I never like to see very strong opens as that leaves a lot of time during the trading session for sellers to emerge knock down the market.  I prefer to see stocks rally into the close like they did on Friday.

In economic news we got some more positive housing data.  Existing home sales for October rose to 4.79 million from 4.69 million last month.  And the NAHB Housing index for November rose from 41 last month to 46 this month.  Both readings were above consensus.

Overnight markets in Asia were higher.  Japan led with a 1.4% gain and China lagged with 0.1% rise as news came out that China saw housing prices decline in 17 of 22 major cities last month.

European markets are also higher today despite a member of the ECB saying Greece will be unable to return to public markets in 2015-16 and will likely need more aid.

The dollar is lower today and helping to boost commodities.  Oil is up past $89, aided by the escalating Israel conflict.  Gold prices are higher to $1733.  And silver and copper prices are higher as well. 

The 10-year yield is higher to 1.61%.  And the VIX is down -3.7% today back below its 50-day average to 15.80.

Trading comment: Last week I commented that the Nazz had been down 6 straight weeks and was overdue for a bounce.  We started to add some QQQ on Friday to trading accounts and I was looking to add to it today but with the markets up as much as they are this morning I don't want to chase and overpay. If we get an intraday dip I will likely add some as I still think the markets could see further upside this week.  The market is very short-term oversold and investor sentiment had recently become pretty bearish.  So that should provide a backdrop for more than just a one-day bounce.

KAM Advisors has long positions in QQQ

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Oversold Nazz Looks Due For A Bounce

The market is lower once again in early trading as this market continues to trade heavy and just can't seem to bounce.  Bearish sentiment is on the rise, which should help the market bounce at some point.  Also, the Nasdaq has been down 6 straight weeks so it looks overdue for a bounce as well.

Fears about the fiscal cliff continue to manifest themselves in the form of high dividend paying stock getting hit the hardest.  Today telecom stocks are getting sold off, and the utilities sector has already seen heavy selling.  I think that is a mistake and that investors will realize that even if dividend taxes rise ultra low interest rates remain and that keeps these dividend streams attractive on a relative basis.

The latest news is that the White House is considering delaying the spending cuts.  We mentioned recently that this has been the call from our sources at Goldman.  They think Congress will kick the can down the road maybe to June 2013.

In economic news, industrial production fell by -0.4% in October, below expectations.  And capacity utilization fell to 77.8% from 78.2% the prior month.  This figure points to the continued slack in the economy and lends itself to the notion that inflationary pressures like unit labor costs seem a ways off.

Asian markets were mixed overnight with Japan rallying and China selloff off to a 7-week low after the Chinese press warned that the recent bounce in economic data may be temporary.

Europe is also lower this morning after Germany's Merkel made comments that the ECB should limit its bond buys from highly indebted states and that the OMT program should only be used in emergencies.

Elsewhere, the fighting between Israel and Hamas continues to escalate.  Oil prices are nearing $87, but I'm surprised that they haven't surpassed $90 on the escalation of these mideast tensions.

Gold prices are weaker today, near $1711.  Silver and copper prices are lower as well.

The 10-year yield has slid back to 1.56%.  And the VIX is up 2% back above the 18 level.  It bounced hard off its 50-day and still looks like it could test the 20 level.

Trading comment: This market feels very heavy.  We have held off from doing any buying, but with things very oversold now bounce candidates are looking more attractive.  I mentioned that the Nazz has been down 6 straight weeks.  That has often been about as long of a streak as we have seen and usually a good time to take a stab at the long side.  We are looking at adding some QQQ for a trade.  AAPL continues to pace the Nasdaq on the downside as it approaches the $500 level.  I hope that stock can make a stand soon as I am surprised it hasn't found better support already.  I would like to see the market bottom this morning and close higher into the close to make me feel better.  But that may be wishful thinking.  Stay tuned.

KAM Advisors has long positions in AAPL

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FutureM: For Marketers, Times They are a Changin’

I attended FutureM in Boston a few weeks ago and the main take away was: Marketing is changing quickly and organizations must grow and adapt, otherwise they will fall behind.

IDC’s CMO Advisory Service has been advising this for some time, but as I read more blogs and attend more marketing based events like FutureM, the reality of overarching change is becoming obvious. IDC’s data points to this as well; investment in Digital Marketing within the Enterprise Tech industry has increased from 12.6% of budgets in 2009 to 29.2% by the end of 2012* - we expect this trend to continue.

Below I have outlined 3 sessions that did a great job of highlighting the change that is taking place. I then took particularly interesting or relevant quotes and expanded on them.

The Future of Social is Action and ROI

“Social has to be collaborative between agencies and the brand – It has to be done for consumer insight and you cannot do it for the sake of just doing it.

                   - Anthony van Dijk, Brand Manager, Global Gillette Venus Base Business, Gillette

This quote hit home with me – as social, and digital in general, continue to mature, marketers must engage with their agency around these topics. However, don’t just check off a box by giving them the set of keys to your online presence and communities. Hold your team and agency accountable; have a specific plan and goals. Almost as importantly, don’t just give your agency a mandate to improve social, work with them and guide them as your brand and goals change. Social is often instantaneous, you cannot expect the undertaking to be a straight line trajectory – be ready to adjust and if you’re expecting deliverables from your agency give them the best chance to help you succeed!

Understand IDC’s guidance for B2B Social Marketing by downloading our report: “Despite the Hype, B2B Social Marketing Is Still in Its Infancy: 2012 Guidance for New Investment Dollars and Staff”

The End of Depth? Marketing Complex Services and Products

“The buyer is on a journey and the vendor is not invited.”

-                    -  Joe Chernov - VP of Marketing, Kinvey

This was one of my favorite quotes of the entire conference - it was provocative and goes against much of what we have been taught as marketers. If you take a broader view, Joe is right, this isn't your father’s “buyer” the tools and knowledge available today have changed everything. Rather than Sales or Marketing holding all the information, social networks, forums, and the rest of the internet can provide the Buyer with a large majority of answers. As IDC has reported in our recent publication, The 2012 IT Buyer Experience Survey: Accelerating the New Buyer's Journey, marketers and sales must be aware of this new reality and adjust their strategies and tactics. Additionally, my colleague Kathleen Schaub wrote a great blog post on Operationalizing Your Buyer's Journey. The report and post both are great places to start on this topic!

DataXu’s Data Brew: The Data-driven Power Shift

“Good professionals let the data speak, if you don’t have good data – don’t make a decision!”

-                     - Chuck Hollis, VP -- Global Marketing CTO, EMC Corporation

Discussion around Analytics and Big Data resonate strongly with me - they are hot topics in the marketing world and can provide immense value. Our group always urges marketers to utilize data any chance they can. However, it is easy to get caught up in the excitement of trying to quickly move projects forward while using data as a guide. Chuck’s quote reminds us to be honest with yourself and be honest in your decision making process, don’t make a decision based on data unless it is telling a clear objective story.

For more information on data driven marketing download IDC’s study “Data-Driven Marketing: A Survey of Marketing Automation Maturity in Global High-Tech Companies”

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While these quotes give a quick glimpse into a few sessions at FutureM, the entire conference is a reminder that there is a lot of change in Marketing and many technologies and companies can be a huge asset in this transformation. Don’t ignore this change, take time to educate yourself even if it is just a few hours a week to demo a new product or service or view an interesting webinar. Ultimately, as a marketer if you don't start swimming, you risk sinking like a stone. 

You can follow Sam Melnick on twitter: @SamMelnick or contact him at smelnick (at) IDC (dot) com

*Source:  IDC's 2012 Tech Marketing Benchmark Study (full results to be published this quarter)

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