Market Report – November 7, 2011

Filed under: Investor Blogs |
In the Rear View Mirror:The market looks like a roller coaster…down Monday, down Tuesday, up Wednesday, up Thursday and back down on Friday. It’s making us crazy.Greece’s wishy-washy government and schizoid prime minister continue to be the prime drivers for the stock market. Will they or won’t they come through with an austerity program that could go a long way towards preventing a default on its debt. Not saying that it will prevent a default, but without one, it’s a virtual certainty they go in the tank and drag Europe along with them. And guess who follows right behind…well, let’s not go there just yet!!!
The Markets @ 11/4/2011
Index Close Weekly % Change YTD Change YTD%
DJIA 11983.24 -247.87 -2.03% 405.73 3.50%
NASDAQ 2686.15 -51 -1.86% 33.28 1.25%
S&P 500 1253.23 -31.86 -2.48% -4.41 -0.35%
NYSE Comp 7552.23 -251.71 -3.23% -411.79 -5.17%
NYSE Amex 2298.18 -39.35 -1.68% 89.8 4.07%
RUS 2000 746.49 -14.51 -1.91% -37.16 -4.74%
VANG INTL 14.14 -0.72 -4.85% -1.62 -10.28%
USX CHINA 5137.11 -100.3 -1.92% -950.76 -15.62%
Market ReportAll the major indices we follow flashed “red” for the week.

The biggest moves down were the Dow, off 247.87 or -2.03%; the NYSE, -251.71 or down 3.23% and the Vanguard International which was down 4.85%.

Positive moves for the week were in Crude Oil, +0.94 to $94.26; Gold was +9.10, closing at $1.755.30; the dollar was +0.0183 or 0.7251 euros; 10-year bond +2.468 to $100.781 and the 30-year bond was +5.750 to $112.750.

Economic & Financial Comments

The Labor Dept. said that the US added 80,000 jobs last month which was the 13th consecutive month of growth and corrected some previously reported numbers. They also said that 102,000 more jobs were actually added in August and September than had been reported.

The US dollar rose in response to the positive news.

Now for the negative…it’s fair to ask this question, which was voiced by John Mauldin in a recent issue of his “Thoughts from the Frontline” newsletter. Mauldin asked, “How do we get back to full employment in the US in a Muddle Through Economy that needs at least 125,000 [new] jobs a month just to keep up with population growth?” (Today we learned that in October new employment was just 80,000.)

And the follow-on question is “what’s the best way to create them?” However, this is the subject for a future discussion.

The Bottom Line

Let’s talk about down side risk.

The Greeks need to get their proverbial austerity act together and get out of the news pronto.

And speaking of a needed austerity program…what about our illustrative “Congressional Super-committee” that is supposed to be finding ways to trim $1.2 trillion from the US deficit. They had better come through with a reasonably believable plan or the markets are going to respond in a very big way that won’t be pretty…read that as Bad, Bad.

Keep your extra spending money in cash until our crystal ball clears up just a bit…which it will, and then we’ll be buyers.

Research and Editorial Staff
MicroCap MarkePlace