Dow Jones Cheers Jobs Data

Submitted by: Trader J Howell

There may be a deal coming through in a week between the Republican president and the United States President Obama. This is helping the markets to be in the positive territory. John Canally, investment strategist and economist at LPL Financial said, “Everybody is paying close attention to the soap opera in Washington.

Yesterday was a good day. But we’ll probably have a lot of bad days before we’re through.” He feels that there may be rough days coming forward as there is this Fiscal cliff worry and tensions President Obama and the Republican President.

Technical Analysis:

The index remained flat today with a positive bias; Dow Jones rising by around 0.3 percent. This whole week has seen choppy moves by the index and that s quite disturbing. Anyways, the index is above the important psychological mark of 13000 and there is something to cheer for the investors.

The Dow Jones closed at 13074 yesterday and it is slowly inching towards the important resistance level of 13500. Once, that level breaks, it becomes easier for the Dow Jones to break that mark of or all time high of 14000. Unemployment data, too, fell sharply indicating that the economy is in a bad position.

But, that has partly to do with the hurricane Sandy, which came in last month. Because of that, most people were not able to apply for unemployment benefits. Applications for unemployment in the United States dropped to 25000 this week.

Important stocks to watch out for:

Netflix is in the news today after the SEC issued notices to the video board of the company and its CEO, Hastings. This note is regarding the company violating Regulation Fair Disclosure. Meanwhile, Hastings said, “We remain optimistic this can be cleared up quickly through the SEC’s review process.”

Honda said that it has crossed the one million mark in production of its cars yesterday. The North American plants of Honda will be able to make around 1.63 million vehicles per year and the Honda says that it will raise that figure to around 1.92 million per year by the year 2014. Because of the strong Yen, Honda s selling in Japan is not as much as it does in America.

Sirius satellite radio is also in the news today after the company announced a special dividend which is 5 cents a share and a stock repurchase scheme of $2 billion. Most of the money will go in to Liberty media, which has been the company s largest shareholder. The company was trading flat at $2.80 last time, we checked.

Forecast:

The index is slowly inching up towards the important resistance levels of 13500 and then, 14000. Meanwhile, on the down side, there is quite a strong support at that 12500 mark and that will act as a cushion for the markets going forward.

We need to watch out for the comments by the President in the next week about him clearing the deal about the Fiscal cliff. The markets traded in a narrow range this week due to that worry.

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Source:

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