Monday Morning Musings

The markets are slightly lower in early trading, and there isn't a whole lot in the way of market moving news this morning.

Asian markets were slightly weak overnight. China posted larger than expected trade deficit and that has caused some to speculate that global demand for China's exports isn't as strong as it has been in recent quarters.

The dollar is relatively flat this morning, but most commodities are lower. Oil prices have eased back to $105.75 and natural gas is lower to $2.37. Gold prices are back below $1700 to $1697. Copper and silver prices are lower as well.

The financial sector which has been leading recently is the day's biggest laggard so far, while defensive utilities have resumed the lead.

The 10-year yield is sitting right at that 2.00% level that I keep mentioning. And the VIX is down a whopping -10% today new lows. It hasn't been this low $15.35 since July 2011. Of course that was before last summer's swoon which saw the VIX triple from the 15 level. A colleague told me that some of the weakness is due to traders rolling their positions to the new front month options, but I don't think that could account for all of this large decline.

Trading comment: I keep saying that hasn't been a great strategy to wait for the market to take a rest and then look to buy on the weakness. A better bet has been to simply focus on your individual stocks and add to them on weakness, which has come periodically more as a result of sector rotation than an overall market correction. Last week, the market experienced a brief 3-day pullback but that was quickly followed by some buying. That has left the S&P 500 just a few points away from its recent highs at 1378. Since every pullback has been quickly followed to a return to new highs, one would expect the SPX to surpass 1378 shortly. If it doesn't that would be a notable change in character. Of course, the Nasdaq has been up for 10 straight weeks so I would think a down week is coming at some point. But again, I am focused on the action in individual names. And AAPL continues to be a monster.

KAM Advisors has long positions in AAPL

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I’m Sorry, I’ve Already Forgotten Your Name

Over the years I’ve attended many different types of professional networking events and classes at which business owners and managers had the opportunity to introduce themselves and tell the group about their business or job. Having attended several business networking events fairly recently, I have come to the conclusion that introducing oneself for impact, so that other people remember who you are and what you do, requires some serious editing and practice.

99% of you are losing my attention before you’ve half done. You’re trying to tell me much too much, you’re getting too specific and you’re diluting your message.

30 seconds turns into four minutes as you try to expand on specials that your business is running right now, events you are planning, how interest rates are affecting your industry, and even very worthwhile community and charitable causes your business is supporting.

It's just too much. In most cases, way too much.

If you tell me anything more than your name, the name of your business and one strong statement about what you do or what you hope to accomplish, the amount of information I will actually remember drops off precipitously. And I don’t think I’m alone.

I’ve heard it suggested before that when giving a presentation or writing a paper, you should have 3 main points. And most people can remember three things.

When you give me anything more than your name, the name of your business and one strong statement, the amount of information I am actually retaining is dropping off, precipitously. And I don’t think I’m alone. We are bombarded with ads and marketing messages throughout the course of every day. We remember very few of them; and in fact, our brains have learned to tune most of them out.

The three main points presentation principle is a good one when it comes to planning how you will introduce yourself (and your business) to others going forward. This does not mean that you should tell people three different things about your business, it means you need to limit yourself to three things: your name, the name of your business, and one strong tagline or purpose statement.

Think of it this way:  

When you are part of a business networking, rotary, chamber of commerce or another community group, you are thinking for the long term. You are making yourself available so that when people in the community actually need your services (or know someone who does) your business will build mind share with your networking peers that will result in referrals.

When your introduction expands into selling points, you’ve moved into selling mode. You are working a short-term strategy, as if you are cold calling and going for the sale at the same moment, rather than working to build a relationship.

When introducing yourself to any group, first decide what it is that is most important —the one message about your business that you most hope those specific people will remember, and limit your introduction to that one short (but hopefully impactful) statement.

When you know you will have the opportunity to introduce yourself to a networking group, plan ahead. 

• Think about the people who will be in attendance and what one message might resonate most with them. 
• Think about the kinds of customers they have and the types of people they are most likely to come into day to day contact with: what aspect of your business would be most relevant to them?
• Think about the types of customers you most want to attract. 
• Think about your short and long term business goals; what is most important for your business right now?   

To make an impact in 30 seconds requires preparation. But I would argue that you will make more of an impact if you take only 30 seconds than you will if you take 5 minutes. 

For your one strong statement of purpose, you might need to create a tagline for yourself or you may simply be able to take one of the main points from your mission or vision statement and convert it for the purpose. If you have a few (or even several) strong statements, don’t give up, just spread them out. Rather than delivering them all at once, deliver them over time. Take one and stick to it each month, or decide which you will deliver based on its relevance to the audience.

If the information you deliver for yourself and your business is laser-like in focus and clarity, and concise, the potential for audience members to connect with it and remember it increases, exponentially. So when it comes time to introduce yourself, think 3 main points—the three most important things you hope people remember: Your name, the name of your business and one strong statement of purpose.


***


Elizabeth Kraus is the author of 365 Days of Marketing.
365 Days of Marketing is available on amazon.com in print or digital format. It contains marketing how-to, inspiration and content for every day of the year -- literally -- to help you build a bigger role for your business in the lives of your clients and community. 
 

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Does Strengthening Economy Take QE3 Off The Table?

The dollar is rallying this morning on the heels of a better than expected jobs report. The stock market is also nicely higher, and lo and behold the S&P 500 is right back at its highs from last week.

Nonfarm payrolls rose by 227,000, above expectations. Private payrolls also beat expectations and grew by 233,000. The unemployment rate remained steady at 8.3%. With increasing signs of an improving economy, one has to wonder what those calling for QE3 will have to hang their hat on after this?

Overnight news that Greece's debt swap was met with better than 80% participation may have helped Asian markets rally, but it has done little to help the euro this morning vs. the strong dollar. The euro ETF (FXE) is sitting right on its 50-day support.

Commodities were lower this morning, but most have since rallied. Gold prices are higher to $1710, oil prices are up to $106.70, and copper and silver prices are higher as well.

The 10-year yield is bouncing to 2.05%, but it is still in this multi-month trading range that has not been able to get above 2.10%. As for the VIX, it is plunging this morning down -7% to 16.67. I am surprised by the sharp drop in the VIX, but looking at the chart it looks possible that we could see new lows in the VIX if the market keeps rallying.

Trading comment: The SPX is right back at its highs for the year. I said earlier this week that after the 3-day decline we wanted to step in and do some buying. Even though I thought the correction wasn't over, I stated that just going by the action in the major indexes wasn't the best strategy over the last several months. You have to follow your stocks, and add to them when they are showing good setups. Waiting for the market to correct more sometimes can keep you from making good individual decisions. Also, Colorado had a big win last night vs. Oregon. They play again tonight in the semi-finals of the PAC-12 tourney here in LA. Go Buffs!

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Eurozone Optimistic About Greek Bond Swap

The market is trading higher in early trading, seemingly taking most of its cues from overseas markets. There isn't a whole lot in terms of market moving economic data or corporate news in the U.S. this morning.

Overnight, Asian markets rallied strongly and Europe's markets are nicely higher this morning. There seems to be more confidence right now that Greece will be successful in its effort to conduct its debt swap. This can also been seen in the bond yields of other PIIGS countries which have started to ease a bit.

The ECB and the Bank of England both opted to keep rates at current levels. ECB Pres. Draghi hinted that the ECB could be done with its LTRO operations, and that now it's up to the member countries to take control of their debt situations and deal with them. He said that the ECB has done its part by taking the tail risk off the table.

The euro is also higher this morning at the expense of the dollar. This is helping commodities, with oil prices up to $106.75 and gold prices bouncing near $1695. Copper and silver prices are higher as well.

The 10-year yield is higher today at 1.99%, but still not able to get above that 2.00% level and stay there. As for the VIX, it broke back below its 50-day yesterday and is moving lower again today. Currently it is down -4.75% to 18.15 as fear quickly comes back out of the market.

Trading comment: Yesterday's snapback rally came on very low volume, which will lead many participants to question the conviction behind the buying. It is possible we could see the same type of action today, although it is still early so first we need to see if these early gains stick. Since I have said this year I think it will be more productive to focus on individual stock action and not the major indexes, I am looking for stocks that have already corrected or appear poised to break higher from recent consolidations. Some candidates I am looking at include: SRCL, CTSH, LNKD, BMY, and AGNC to name a few.

KAM Advisors has long positions in AGNC, BMY, CTSH, LNKD, and SRCL

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Is The Market Selloff Over?

The market is getting a small bounce in early trading, but so far it feels like a weak attempt. Lots of folks are pointing out that yesterday was the biggest decline of the year, but it hasn't exactly been a normal start to the year. As such, we were overdue for a day like yesterday, which wasn't even that bad of a selloff in the big picture scheme.

This morning's ADP Employment report was solid at 216,00 payrolls in February. That's up from last month's 173,000. Hopefully this translates into a good govt. payrolls report on Friday. Q4 productivity was also revised higher to 0.9%, although there was a big jump in unit labor costs.

Asian markets were lower overnight, but Europe is higher this morning despite the big Greek debt swap that is taking place soon. There isn't much action in the euro or the dollar.

Commodities got hit yesterday, and are relatively flat so far today. Oil prices are down slightly to $104.50, and gold prices are up just a bit to $1677.

The 10-year yield is getting a small bounce to 1.96%. And the VIX is down -3.5% so far back near 20.15 after a big spike higher yesterday. The VIX is still above its 50-day average which is hovering around 19.60 and we will have to see if it acts as support.

Trading comment: Everyone wants to know if yesterday was the end of the selling? I think that is unlikely. We have seen plenty of one-day pullback over the last few months, but I think the breaking of that uptrend line that's been in place means that the market could have a bit more consolidating to do. I still don't think it's going to be anything other than a mild correction though. The S&P 500 is still well above its uptrending 50-day average (currently 1323), and I think we could see the senior index come closer to this support before all is said and done. I covered a bit more of our etf hedges yesterday, and would look to start doing some buying on any further weakness in the market.

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A Change In Character For The Market?

The market is down sharply in early trading, with the Dow on pace for its first triple digit decline on 2012. Of course, it's still early so we could see dip buyers step in again before the close. But with the markets up for 8 of the last 9 weeks, many participants would welcome seeing the market digest some of its recent gains.

There isn't much in the way of market moving news this morning, so people are reaching for headlines to attach to the selling. Some are looking at China's lower GDP forecast, but that news was out yesterday. Others are pointing to the -0.3% decline in Q4 GDP for the eurozone, but this was unchanged from the previous forecast so it's not new information. One new datapoint was Brazil posting lower growth than expected. As such the emerging markets ETF (EEM) is down -3.35% in early trading.

Asian markets were lower overnight, with China down -1.4%. Europe is lower this morning, with some chatter that there is concern about Greece's upcoming bond swap later this week. The euro is also lower today, and the flight to safety is boosting the dollar.

Commodities are lower across the board, with oil prices down near $105 and gold prices back below $1700 closer to $1672.

The 10-year yield has dipped back below 2.00% to 1.94% currently. And the big surprise is the 15% spike in the VIX that has taken it back above the 20 level to 20.60. The VIX has been in a downtrend for months, and this is the first time the VIX has been above its 50-day average since the day after Thanksgiving (11/25).

Trading comment: Today will be an interesting day. Everyone has been saying that they are waiting for a pullback in the market to do more buying. But I posed yesterday that if the decline came swiftly, it would shake the dip-buyer's confidence. We will probably hear some of that today, with people shifting their tunes and saying this is probably the beginning of a correction. Given that the sentiment indicators never reached bullish extremes, I think that this pullback will likely be of the shallow variety. As such, I want to stick my toe in the water and start to do a little nibbling today. If the market continues to slide, I will leave myself room to do more buying on further weakness.

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One-on-One with Mitt Romney (Part I)

In my interview with Mitt Romney yesterday he stayed on message for growth, jobs, less debt, and smaller government. He reaffirmed that “he won’t set his hair on fire”, meaning no splashy off message statements to distract from his fundamental economic push. He acknowledged that the primaries have made him a much tougher, better candidate and more prepared to carry the fight to Obama.

He emphasized his 20 percent supply-side reduction in income tax rates. And interestingly, in response to my question, he said he would take a look at indexing the capital gains tax for inflation. That’s a pro-growth idea supply-siders have pushed for many years. I hope he finally adopts it.

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