Market Direction Weekly Closing Numbers©

Market Direction: BULLISH alert issued 11/10/2016

The economy

The stock market enjoyed its second consecutive week of gains that lifted the S&P 500 into the neighborhood of its record high. The benchmark index gained 0.8% for the week while the Nasdaq Composite (+1.6%) outperformed after lagging one week ago. Conversely, the Dow Jones Industrial Average (+0.1%) underperformed after showing relative strength during the election week.

The overall post-election narrative did not change much during the past week. Expectations for inflationary fiscal policy kept the bond market under pressure, driving the benchmark 10-yr yield up to a one-year high of 2.34% from last Friday's 2.14%. Continued steepening in the yield curve helped the financial sector extend its November gain to 12.3% while the U.S. Dollar Index (101.34) climbed to its best level since early 2003.

Market participants received a batch of quarterly earnings from the retail sector during the past week. Apparel retailers had a mixed showing while electronics retailer Best Buy (BBY) surpassed estimates and issued upbeat guidance for the holiday quarter. Home Depot (HD) also released upbeat earnings and guidance while Wal-Mart (WMT) struggled after its earnings beat was overshadowed by declining profitability. More than 95.0% of S&P 500 components have now reported their third-quarter results, showing an earnings growth rate of 3.0%.

Last week featured Janet Yellen's testimony before the Joint Economic Committee of Congress, but the appearance was free of any big surprises. Chair Yellen acknowledged that recent economic data has lived up to the Federal Reserve's expectations, and noted that a rate hike will be appropriate "relatively soon." Ms. Yellen's appearance had little impact on the fed funds futures market, which continues pointing to a near certainty of a rate hike in December. The implied probability of a December hike rose to 95.4% from last Friday's 81.1%.

$tockMarketDirection proprietary model is currently BULLISH. We strongly encourage you to monitor positions closely, exercise proper money management strategies and follow us at $tockMarketDirection for ALERTS we may issue advising a change in the current market direction. Stay tuned and follow us. If you have a testimonial or comment of how this website has helped you we would like to know, write us. Share with a friend.

By the numbers the weekly closing index numbers compared to the initial BULLISH recommendation closing numbers: 

Stock Market Closing Numbers
compared to Recommendation Numbers
	11/10/2016	11/18/2016	Difference
Dow Jones	18,807.88	18,867.93	60.05
Nasdaq	5,208.80	5,321.51	112.71
S&P 500	2,167.48	2,181.90	14.42

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