Wednesday, April 18, 2012
Stock Market Commentary:
Spanish Debt Woes and Earnings Hurt Stocks:
Stocks fell on Wednesday as fresh concerns spread about Spain’s onerous debt levels. In other European news, minutes from the Bank of England showed that only one Monetary Policy Committee member still supported quantitative easing which squashed hopes of anther round of QE. ECB policymaker Jens Weidmann told Reuters that Spain should take care of its own debt woes and ruled out a third long-term financing operation (LTRO) from the ECB. In a surprise OP-ED, Portugal’s prime minister wrote in the Financial Times that the country may not return to capital markets for funds in 2013, as previously expected. Earnings disappointments from IBM and Intel (INTC) also weighed on stocks.
Market Outlook- In A Correction
From our point of view, the market is getting stronger now that several of the major averages are fighting to get back above their respective 50 DMA lines. Looking forward, that level should now become support. Therefore, probing the long side with close protective stops (below the 50 DMA line) might be prudent if you are looking for a low risk entry point. As always, keep your losses small and never argue with the tape. If you are looking for specific help navigating this market, feel free to contact us for more information. That’s what we are here for!