It’s an ugly day on the markets…Gold got as high as $1,711 overnight but has pulled back toward its support band…as of 8:15 am Pacific, the yellow metal is down $19 an ounce at $1,680…Silver is off $1.29 to $31.48…Copper is 7 cents lower at $3.27 on some weak numbers out of China…Crude Oil has lost $2.29 a barrel to $95.72 while the U.S. Dollar Index has climbed nearly a full point to 79.15 on this “risk-off” day…
A China manufacturing index slowed to 48 in November from 51 in October, according to a preliminary reading reported by HSBC and Markit Economics today…that’s the lowest reading since March, 2009…a number below 50 indicates a contraction…“Industrial output growth is likely to slow further in coming months on weakness in domestic and overseas demand,” said Qu Hongbin, a Hong Kong-based economist for HSBC, in a report in the Financial Times…“Moderating inflation may leave more room for Beijing to step up selective easing measures”…it’s worth noting that the Australian dollar, which is particularly sensitive to perceptions of future Chinese raw material demand, has lost more than 7.5% in November…
A slew of ho-hum economic numbers were released out of the U.S. this morning, the day before Thanksgiving for our American friends (U.S. markets are closed tomorrow of course)…U.S. consumer sentiment held up in late November as some of the gloom over the economic outlook ebbed, a survey released this morning showed…the Thomson Reuters/University of Michigan’s final reading on the overall index on consumer sentiment came in at 64.1, up from 60.9 the month before…that was just slightly below the median forecast of 64.5 among economists polled by Reuters…a separate report showed consumer spending barely rose in October, as households took advantage of the largest increase in income in seven months to rebuild their savings…markets will be closely watching the Black Friday retail numbers out of the U.S. for an important early indication of consumers’ Christmas spending appetites…new orders for a range of long-lasting U.S. manufactured goods unexpectedly rose in October, but sharp downward revisions to the prior months’ data and weak spending plans by businesses suggested manufacturing was taking a breather…a drop in non-defence capital goods orders was not encouraging…and the number of initial claims for U.S. unemployment benefit rose slightly to 393,000…
The Dow and TSX are both down sharply, over 200 points…the CDNX has lost 31 points and is now sitting at 1524…its important 300-day moving average (SMA) is now in decline, the first time that has occurred since just prior to the 2008 Crash…not a good sign…
John’s 2.5-year weekly chart for the CRB Index continues to show a downtrend channel which is also not positive for the CDNX…the RJ/CRB is currently down 4 points at 307 (the chart was based on yesterday’s close)…
Even in a bear market, some stocks will stand out and do well…while we haven’t mentioned Cap-Ex Ventures Ltd. (CEV, TSX-V) before, some of our readers were quick to catch on to it recently and have recorded some nice gains…CEV has made a significant iron ore discovery approximately 30 kilometres northwest of the mining town of Schefferville, Quebec…the stock closed up 27 cents yesterday at $1.24 in anticipation of news which came out this morning…the intervals and grades reported this morning are impressive but the “sell-on-news” mentality and ugly markets today have created some selling pressure…the stock was driven down to a low so far today of $1.06…it’s currently off 17 cents at $1.07…the pullback is healthy, though, from a technical standpoint as CEV has been on fire recently…the 100-day moving average (SMA) has reversed to the upside but the stock faces a resistance band as John’s 1-year weekly chart outlines…all factors considered, a challenge of that resistance – at the very least – seems logical… the rising 10-day SMA, currently just above 90 cents, has been providing strong support over the last month or so…in situations like this, a pullback to the 10 or 20-day SMA would be considered normal before the uptrend resumes…as always, perform your own due diligence…
Remember the Tax-Loss Selling Deadlines
We may be getting closer to holiday parties and eggnog, but don’t let your finances go by the wayside. Mark these important dates in your calendar:
December 24, 2010 is the last day for tax-loss selling for Canadian taxpayers selling Canadian equities. Note, the TSX will also be closing early that day, at 1PM EST.
December 28, 2010 is the last day for tax-loss selling of U.S. equities for Canadian taxpayers.
December 31, 2010 is the last day for tax-loss selling for U.S. taxpayers for Canadian and U.S. securities.
Comment by John - BMR — November 23, 2011 @ 11:37 am
John, BMR, how much weight do you place or consider with Buy:Sell ratios. E.g. AGE is currently 4:1 and VGD 1:3.3 – presumably AGE is healthier? Thanks
Comment by Andrew — November 23, 2011 @ 1:07 pm
Andrew
Sorry, but I am not sure what you mean by BuySell ratios…what am I missing?
Comment by John - BMR — November 23, 2011 @ 2:03 pm
Sorry John, I omitted the : between Buy Vol:Sell Vol. In Market depth Level 2 it will give the Buy Volume and the Sell Volume. So, I sometimes calculate the ratio and when the stock is in demand the Buy volume will be close to or higher than the Sell Volume. Back in the Spring before INT.V share price fell and didn’t recover the Sell Volume was several fold higher than the Buy Volume, perhaps a 1:15 Buy:Sell ratio and it proved to be an indicator to liquidate holdings. In the recent rally in VGD and AGE (a week or so ago?) both had Buy:Sell ratios where the Buy Volume far exceeded the Sell Volume.
Comment by Andrew — November 23, 2011 @ 2:40 pm
Andrew
I don’t follow the volumes in that way or watch the level 2, but I do watch carefully the units on the Bid and Ask for an active stock. That often tells me if a stock is being accumulated or sold off by the way the Bid or Ask units are replaced when they are hit.
Comment by John - BMR — November 23, 2011 @ 2:49 pm
VGD closes P.P. for 2.87 million. R !
Comment by Bert — November 23, 2011 @ 5:08 pm
I like the fact VGD has another $3 million in the treasury, so they’re likely sitting on about $6 million cash right now with another $2 million or so due back from the Quebec government…..what I don’t like is the overhang in the market that will come from these flow-through shares next year…also the NR stated drilling in 2012 will be less than this year…….25,000 metres is still a lot, but a far cry from the nearly 40,000 metres this year…..disappointing to hear that, especially before assay results are even in from Wasamac and Joutel….I’m surprised they would signal that to the market right now….
Comment by Jon - BMR — November 23, 2011 @ 7:38 pm
I’m sure VGD will expand their drilling if market conditions improve next year. Probably a difficult decision for VGD to make in the current climate and without assays back from the lab? At least they have their budget set up for next year.
Comment by Andrew — November 24, 2011 @ 6:31 am