NYC Blizzard 2015 a dog – but so is Tuesday’s stock market
WASHINGTON, January 27, 2015 – To be perfectly honest, Wall Street’s January 2015 trading action has been stuck mostly in “suck” mode, careening down, then up, then down again but always with a lurking negative bias. And so it is this Tuesday morning.
The negative drift of this morning’s trading, if you’ll excuse the indirect pun, was largely being blamed in advance on the ultra-hyped Snowmageddon event slated to begin last night in New York City and further up the East Coast.
Judging from the dire, breathless warnings from weathermen and area politicians, the Maven fully expected frantic news reports this morning describing how advance glaciers marching south from Hudson’s Bay had tragically encased both New England and the Big Apple in a New Ice Age.
New England is indeed getting whacked even as we write this. As for NYC? Just another snow burst of self-important hype designed primarily to give those generally behind-the-scenes weather gurus another chance to strut their stuff and enjoy one of their periodic 15-minute intervals posing as fleeting authority figures.
Ditto the Louis XIV-style warnings and pronouncements from New York’s idiotic clown of a mayor Bill De Blasio, the 21st century’s re-incarnation of the city’s last really effective mayor, David Dinkins. (Remember him.?)
The upshot of the whole hysteria scene? A normal snowfall. Which, of course, having been over-hyped and over-prepped in advance must have scared all possible buyers away from Wall Street this morning, causing the markets to get pancaked, to mix the metaphor, at the opening bell, with the Dow plummeting some 300 points within minutes.
Of course, we’re sure this morning’s drop had nothing to do with the mediocre-to-lousy earnings reports coming out from a number of Wall Street giants. Microsoft (MSFT) had so-so numbers and was immediately taken out back and shot by traders, who pounded it down some 8 percent in short order.
Caterpillar (CAT) was next to face the firing squad, getting machined-gunned (down 8.2 percent) for its miserable earnings report. Which, if you think about it, was not really a surprise since apparently no one needs any substance of any kind that’s extracted by mining or digging, which would certainly tend to cut big equipment sales, n’est-ce pas?
Procter & Gamble (PG) disappointed as well, quite badly in fact, reporting a quarterly profit that tanked close to 31 percent with green ink apparently erased, in large part due to the massive drop in the Euro and its translation effect on P&G’s substantial international numbers.
PG shares were rewarded for their effort with a 3 percent haircut. You can start to expect similar results from many of Wall Street’s biggest companies, most of which have substantial international sales, all of which will bear the brunt of the see-saw action in the dollar/Euro pairing.
Other numbers are expected to be equally dismal, save for yet-to-report Apple (AAPL), whose numbers should prove spectacular given the surging worldwide sales numbers for the newly-introduced pair of iPhone 6s. On the other hand, the Wall Street tradition is to sell the dickens out of Apple when it reports world-beating numbers. So the Cupertino crew’s likely impressive profits will prove—illogically—to be a bust for the price of their stock, or so we think.
Meanwhile, low-level tension continues to build over the socialist sweep in Sunday’s Greek elections. Syriza and its followers are fiscal idiots, of course. Like the followers of the late Hugo Chavez in Venezuela, Greek socialists will want to do everything they can do to give away more nonexistent money to the poor whichever way they can, perhaps destabilizing the already unstable Eurozone even more than it currently the case.
That said, we are beginning to find it harder and harder to criticize always-wrong Marxists like the Syriza Gang. With most “traditional” parties running Western oligarchies democracies now wholly-owned subsidiaries of the mega-rich, there aren’t many political places left for middle and lower class citizens to cast meaningful votes for candidates that might conceivably put the 99% first. That’s always been the siren call of Marxists of all stripes.
So when the greedy rich entirely lose touch with the real world—which all of them pretty much have—it becomes easy for all those retro-commies to win elections. Forgotten is the fact that none of these Marxist thugs and theoreticians have ever solved any economic problems at all. But that’s lost in the joy of throwing the rich bastards and their politician minions out of the government and, presumably, taxing them out of existence. And at this point in history, it’s getting harder and harder to say they don’t deserve it.
These strange developments, along with all the other tensions arising throughout the current world’s state of affairs have united with the earnings bust, the blizzard that did not come and the dawning realization that the Fed is no longer supporting the stock market directly—all of which, taken together, are still scaring the bejeebers out of traders and investors alike.
But the yo-yo style action we’re getting on Wall Street in January doesn’t give bears and short-sellers much confidence either.
It’s a confusing mess, and we are still going to wait, for the most part, for the smoke—or ice—to clear before we start placing too many bets.
So if you have a pile of cash, maybe its just best sitting there until we can get the market’s GPS working again.
So no trading tips for today. Except to say that stocks in the oil patch are grossly oversold and there may be some bargains to pick up here at some point, once they’re really finished going down. Trust the Maven: determining that precise moment of the year will, hands-down, prove the best trading bet in 2015. For whomever can figure out when it will happen.