Other earnings this week will be PepsiCo, Mattel and JP Morgan. JP Morgan will be an important one later in the week because we will get to see the state of the financial industry. Expectations have been really lowered for bank profits because of this volatile market environment. JP Morgan's stock has lost almost 30% of its value this year.
This earnings season will be especially interesting to monitor because they can confirm or deny a global economic slowdown and a US recession. Companies not only report 3rd quarter earnings but also give their outlook for the future which will be much more important with so much uncertainty around. With the market having rallied over 100 SNP points in the past week or so, I believe we will need to see some good earnings from companies to sustain the rally.
Well, the first earnings of the season was a dud. Alcoa reported disappointing earnings and their stock is down 5% in after hours trading right now. The news was not all bad however as the CEO said economic growth was continuing outside of Europe.
"With the exception of Europe, we saw growth in our end markets, though at a slower rate than in the first half, as confidence in the global recovery faded," Chairman and CEO Klaus Kleinfeld said.
Alcoa has been a serial disappointer when it comes to earnings so this shouldn't affect the markets too much tomorrow. US stocks are trading down 75 points after Alcoa's poor result.
Today was a choppy but quiet day in the markets. With moves of over 100 Dow points being commonplace recently, today's action was almost dull. The Dow finished down 17 points but the SNP and NASDAQ were up as AAPL was sharply higher today.
Gold traded down 4 dollars and oil was nearly unchanged.
On a side note, I just picked up a book called the Stock Trader's Almanac. It is a real intredasting book with many good investing nuggets. Here is one of them for example. The best time to buy Gold is in July. Over the past 15 years, if you had bought Gold in July and sold it in December you would have made a 15% average gain. This book has a lot of great seasonal strategies and patterns to follow. I'd recommend it if you have an interest in trading or the market's. You can buy it on Amazon right now for 33% off.
Disclaimer: Nothing in this blog should be construed as a recommendation to buy or sell any securities! Please do your own due dilligence before buying any stocks or bonds!