The major indices closed on Friday in far better shape than might have been expected, suffering only modest declines for the week as a whole after Fed Chairman Ben Bernanke sparked a sustained rally on Friday with comments suggesting the Fed was willing to consider more muscular intervention in the economy to quicken the pace of recovery. The S&P 500 slid only 0.7% for the week after being down as much as 2.3%—eventually settling at 1,064.59 at Friday’s close (+17.37, 1.66%). Bernanke made clear his belief that growth will pick up significantly in 2011, suggesting that the Fed will consider “unconventional measures” to forestall any slide into double-dip recession. Bernanke’s statement reassured investors, and stocks rallied 1.7% following the announcement, with the Dow up 164.84 on Friday to finish at 10,150.65 (+1.65%) and the Nasdaq rising 34.94 to close at 2,153.63 (+1.65%). Friday afternoon also witnessed a sustained Treasury sell-off.

YTD Stock Market Performance

Response to the Fed’s message was mixed overall. Only three of the ten major sectors rose, led by utilities (+2.0%), with the tech sector acting as a significant drag on the market—down 2.1%. The majority of economic data remain far from reassuring, with the housing market once again on the precipice. Existing home sales were down 27.2%, reaching an adjusted annual rate not seen since record-keeping began in 1999. At the same time, new home sales plummeted to between 276,000-334,000—the lowest figure since 1963. Second-quarter GDP was revised down to 1.6% from 2.4%, though most analysts had expected a lower figure.

On the corporate front, Dell and Hewlett-Packard are involved in a bidding war for 3Par, a data storage company. Dell, which had seemed to have a takeover of 3Par well in hand prior to HP’s involvement, was forced to raise its offer significantly, to $27 per share. HP has since responded with $30 per share offer.

Canadian-based Potash (POT) has rejected a $130 per share offer from BHP Billiton (BHP) and is said to be encouraging other bidders.

Intel has lowered its third-quarter revenue projections significantly, to between $10.8 and $11.2 billion.

In Europe, the FTSE 100 was up 45.72 to finish at 5,201.56 (+0.89%), the DAX rose 38.59 to close at 5,951.17 (+0.65%), and the CAC 40 gained 32.41 to end Friday’s session at 3,507.44 (+0.93%).

In Asia, shares finished mixed on Friday, aided by a major reversal in Tokyo as investors shrugged off losses amid hopes of further stimulus action and a government initiative to counter the recent rise of the yen. The Nikkei 225 Index added 84.58 points, or 1%, to finish at 8,991.06. Hong Kong’s Hang Seng fell 14.71 points, or 0.1%, to close at 20,597.35–its sixth straight negative session. Shanghai’s CSI 300 Index rose a modest 8.47 points, or 0.3%, to settle at 2,858.57.

Light crude oil finished at 75.57 per barrel, up 0.53%; gold closed at 1,235.70—up 0.01%. The 10-year Treasury bond rose 6.12%, producing a yield of 2.65%.

The rocky ride for investors is expected to continue in the coming week, as the glow from recent corporate earnings reports fades and the focus shifts to weak—and weakening—economic data.

Absolute Return Trading Systems (ARTS) Inc. delivers market timing instructions to its subscribers from its proprietary algorithmic market timing software.  The system, designed by a team of researchers over more than a decade, is designed to produce positive returns in both up and down markets.  ARTS provides performance and risk information on 43 exchange traded funds (ETFs) and 21 stock market indices and has consistently been a top-ranked market timing service as measured by the leading third-party performance verification service, TimerTrac (www.timertrac.com).

Popularity: 12% [?]

On the whole, the week ending August 6 was far from smooth, though it began promisingly enough. Markets moved strongly upward at the start of the week, finishing above their 200-day moving average for the first time since June. Positive data from the ISM Manufacturing Index helped to build confidence.

However, typically mixed economic data began to sour moods by the middle of the week. A better-than-expected July ISM Service Index of 54.3 was effectively offset by a worse-than-expected 1.2% drop in June factory orders, a drop in pending home sales for June, and stagnant personal income and spending numbers for the same month.

A reported increase in private payrolls for July had no effect after news came in that initial jobless claims for the week ending July 31 hit a three-month high of 479,000. On Friday, negative sentiment was reinforced by the US federal government’s report that 131,000 nonfarm positions disappeared in July, well above a projected loss of 87,000 jobs. Overall unemployment, however, remained static at 9.5%–in part because many have given up looking for work.

Sellers took over the market on Friday–though a late recovery ultimately pushed stocks back above the 200-day average. Some strength was visible in building products, life science tools and restaurants.

Large numbers of retail investors clearly remain anxious about re-entering the stock market as economic conditions continue to weaken and additional corrections appear imminent. Depressed trading volume clearly reflects this.

Corporate earnings continue to defy expectations, but their influence has been weakened significantly. Pfizer, Kraft, and Mastercard all issued robust numbers.

Another significant event came in the form of Fannie Mae’s earnings report, with the government-backed mortgage giant reporting a net loss of $1.2 billion in the second quarter of 2010–infinitely more reassuring than its net loss of $11.5 billion in the first quarter. Net revenue was $4.5 billion, up 49 percent from $3.0 billion in the first quarter of 2010. A jump in net interest income and shrinking credit-related expenses helped to bolster the company’s numbers.

The Dow Jones lost 21.42 points to close at 10,653.56 (-0.20%), while the S&P 500 was off 4.17 to finish at 1,121.64 (-0.37%). The NASDAQ dropped 4.59 points to finish at 2,288.47 (-0.20%).

In Europe, the FTSE dropped 33.39 on US jobs data to settle at 5,332.39.

In Asia, Shanghai added 37.64 to end the day at 2,658.39 (+1.44%). The Hang Seng also had a strong performance, rising 127.08 (+0.59%) to close at 21,678.80. The Nikkei 225 bucked the trend, however, dropping a modest 11.80 (-0.12%) to settle at 9,642.12.

The euro gained 0.0120 against the dollar, finishing at 1.3276 (+0.91%). The dollar dropped to $85.45

(-0.45%) against the yen. The yield on the US Treasury’s 10-year bond fell to 2.82%.

Oil rose 0.15 cents to close at $80.55 per barrel, while gold added $2.25 to finish at 1,205.90 (+0.19%) per ounce.

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The ARTS Team

About: Absolute Return Trading Systems (ARTS), Inc. www.absolutereturnsystems.com

Absolute Return Trading Systems (ARTS) Inc. delivers market timing instructions to its subscribers from its proprietary algorithmic market timing software.  The system, designed by a team of researchers over more than a decade, is designed to produce positive returns in both up and down markets.  ARTS provides performance and risk information on 43 exchange traded funds (ETFs) and 21 stock market indices and has consistently been a top-ranked market timing service as measured by the leading third-party performance verification service, TimerTrac.

Popularity: 11% [?]

August 1, 2010

Though Friday’s session was choppy, July came to a close with stocks enjoying their best monthly run in a year. The Dow Jones Industrial Average and the S&P 500 each added close to 7% during July—given impetus by generally favorable earnings reports from a host of major US companies. Three-fourths of the 300 companies in the S&P 500 that reported earnings in July surpassed analysts’ projections; Chevron and Merck are the latest to issue extremely positive numbers. Yet anxiety over stagnant job growth in the US remains poised to derail market performance as investors fear that a “jobless recovery” will eventually work to shrink company profits.

YTD Stock Market Performance

Performance on Friday was mixed, with investors pondering somewhat contradictory data on the US economy, consumer confidence and regional manufacturing. The Dow fell just over a single point as a result, finishing the day at 10,465.94 (-0.01%); the S&P moved marginally upward, to 1,101.60 (+0.01%), and the NASDAQ composite added 3 points to close at 2254.70 (+0.13%). The overall rebound is clearly heartening given the downward drift of stocks in recent months—largely in the face of Europe’s debt crisis and underwhelming US economic data. On Thursday, stocks lost value on news that a regional Federal Reserve president had expressed caution about the strength of the economic recovery, and skepticism was reinforced by ambiguous data. US GDP rose at an annual rate of 2.4% in the second quarter, down from 3.7%–upwardly revised–in the first quarter. Though a majority of analysts had expected a second quarter rise of 2.5%, the figure represented the fourth straight quarter of positive economic growth. Consumer spending, however, remained tepid, while measures of consumer confidence painted a portrait of a still-dubious US populace. At the same time, regional manufacturing activity increased markedly, with the Chicago PMI reporting a figure of 62.3 in July—up from 59.1 in June.

European markets ended Friday mixed. The CAC 40 in France dropped 0.2%, while Germany’s DAX added 0.2%. The FTSE 100 finished 1% lower.

All Asian markets were down at Friday’s close. The Shanghai Composite was off 0.4%, the Hang Seng dropped 0.3%, and Japan’s Nikkei in Japan was down 1.6%.

The dollar rose against the euro, but fell against both the British pound and the Japanese yen. Gold added $12.70 to close at $1,183.90 per ounce, US light crude rose 59 cents to $78.95 per barrel, and the yield on the US Treasury’s 10-year note dropped to 2.91%.

On the whole, consumer sentiment continues to lag far behind hard economic data, which suggest that the recession has been over, technically speaking, for almost a year. Only sharply rising employment—unlikely, at this point–is likely to mitigate negative sentiment and reassure wary investors.

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The ARTS Team

About: Absolute Return Trading Systems (ARTS), Inc. www.absolutereturnsystems.com

Absolute Return Trading Systems (ARTS) Inc. delivers market timing instructions to its subscribers from its proprietary algorithmic market timing software.  The system, designed by a team of researchers over more than a decade, is designed to produce positive returns in both up and down markets.  ARTS provides performance and risk information on 43 exchange traded funds (ETFs) and 21 stock market indices and has consistently been a top-ranked market timing service as measured by the leading third-party performance verification service, TimerTrac.

Popularity: 22% [?]

It was a week dominated by earnings reports. By Friday’s close, stocks had reached a one-month high as earnings reports from the industrials sector in particular reinvigorated hopes that recovery is well underway and here to stay. The Dow gained 102.32 on Friday, up 0.99% for the day and 3.24% for the week, closing at 10424.62. Verizon, General Electric, and American Express led the charge on Friday, though Boeing was the week’s star, up 10 percent between Monday morning and Friday afternoon. Verizon beat earnings expectations, though revenue fell as the company continues to battle an energized AT&T; GE’s board approved a 20 percent dividend increase, and a number of brokerages have raised ratings on American Express. Johnson & Johnson proved a laggard, down more than 3 percent for the week. The NASDAQ added 23.58 during Friday’s session, up 1.05% for the session and 4.15% for the week, finishing at 2269.47. The S&P 500 rose 8.99 on Friday, adding 0.82% for the session and 3.55% for the week, eventually settling late Friday at 1102.66.

YTD Stock Market Performance

Positive sentiment was generated (at least in part) by the fact that the vast majority of EU banks passed crucial stress tests, despite reservations among some analysts about the stringency of the tests themselves. Only seven banks failed, and they were generally small and regional, concentrated in Germany, Spain and Greece. Rising investor confidence could be seen in the fact that the CBOE volatility index—a crucial measure of investor fear—lost more than 10 percent, finishing on Friday below 24.

European banks such as Barclay’s, UBS, BNP Paribas, and Deutsche Bank had a mixed Friday on US markets. Royal Bank of Scotland and Bank of Ireland, however, responded positively to the stress test results, rising 4 percent on the news.

In Europe, the DAX rose 175.96 (2.94%) to finish at 6,166.34, while the FTSE 100, less convinced by the bank stress tests, fell 1.19 (0.02%) to close at 5,312.62. In Asia, the Nikkei remained flat, though the Hang Seng added 225.63 (1.10%) to finish at 20,815.33.

The euro closed marginally higher on Friday against the US dollar.

Gold finished the week flat at $1,187.80 per ounce, while oil dropped 3 percent, closing at $78.98 per barrel.

Overall, in a week marked by significant earnings reports, sentiment appeared to swing upward. Most companies beat expectations, though not by as much as many analysts and investors had hoped. In the coming week, 157 other major companies will report earnings, including DuPont, BP, ExxonMobil, Chevron, Boeing, Visa and Merck—among others. Will the current positive outlook hold after next Friday’s close? The vast majority of investors certainly hope so.

Be sure to follow our performance on Twitter and Facebook!

The ARTS Team

About: Absolute Return Trading Systems (ARTS), Inc. www.absolutereturnsystems.com

Absolute Return Trading Systems (ARTS) Inc. delivers market timing instructions to its subscribers from its proprietary algorithmic market timing software.  The system, designed by a team of researchers over more than a decade, is designed to produce positive returns in both up and down markets.  ARTS provides performance and risk information on 43 exchange traded funds (ETFs) and 21 stock market indices and has consistently been a top-ranked market timing service as measured by the leading third-party performance verification service, TimerTrac.

Popularity: 57% [?]

July 19, 2010

US markets finished significantly lower on Friday, with the Dow losing 261 points (-2.52%), the S&P 500 off 32 points (-2.88%) and the Nasdaq tumbling 70 points (-3.11%). The slide was sparked when Bank of America and Citigroup reported weaker quarterly revenues and data suggesting collapsing consumer sentiment revived worries about the strength of the economic recovery. The University of Michigan’s consumer sentiment index fell to 66.5 in July—down from a healthy 76 in late June. Flat consumer prices intensified concerns, indicating weak demand on the part of consumers and an absence of inflationary pressure. Citigroup, Bank of America, General Electric, Intel, and Cisco Systems were among the most actively traded shares, and all finished significantly lower, despite the fact that reported earnings—not revenues—were generally robust. The sell-off wiped out what had been relatively strong gains for the week—between 1.7% and 2.3% through the end of Thursday’s session. In view of the Dow’s 7% gain over the previous two weeks, some retrenchment was perhaps inevitable.

YTD Stock Market Performance

Financial shares were at the center of negative sentiment, with the KBW Bank (BKX) index dropping 5.7%. Only Goldman Sachs was able to weather the prevailing mood, with Goldman shares rising on news that the firm had settled its fraud case with SEC for the relatively modest sum of $550 million.

In the end, the slide spared few, with all 30 Dow shares giving up value. Weakening oil and gold prices helped to pull down underlying shares, with Proctor & Gamble and Wal-Mart being especially hard-hit.

In Europe, all indices finished lower at day’s end, with the CAC 40 suffering the most, losing 2.28% of its value. The FTSE 100 was down 1%, and Germany’s DAX slid 1.8%.

In Asia, results were generally mixed, with the NSE 50 moving the most—up 0.28%.

The euro posted modest gains against the dollar, while the dollar itself slid against the yen. Rising Treasury prices lowered the yield on the 10-year note to 2.94% from 2.98% at the close of Thursday’s session.

Overall, consumer sentiment has deteriorated sharply and Bank of America revenue results appear to have confirmed a persistent pessimism. It could be a rough ride in the weeks and months ahead.

Be sure to follow our performance on Twitter and Facebook!

The ARTS Team

About: Absolute Return Trading Systems (ARTS), Inc. www.absolutereturnsystems.com

Absolute Return Trading Systems (ARTS) Inc. delivers market timing instructions to its subscribers from its proprietary algorithmic market timing software.  The system, designed by a team of researchers over more than a decade, is designed to produce positive returns in both up and down markets.  ARTS provides performance and risk information on 43 exchange traded funds (ETFs) and 21 stock market indices and has consistently been a top-ranked market timing service as measured by the leading third-party performance verification service, TimerTrac.

Popularity: 13% [?]

July 12, 2010

In the relative absence of news, and with light trading volume, stocks moved little during most of Friday’s session. However, in the final hour of trading, the major averages were able to shift upward and finish between 0.6% and 1.0% higher. Major indices—in a shortened week—posted their best weekly gains of the year so far. The Dow Jones Industrial Average added 59.04 (0.58%) to close at 10,198.03; the Nasdaq added 21.05 (0.97%) to finish at 2,196.45, and the S&P 500 Index rose 7.71 (0.72%) to finish Friday’s session at 1,077.96. The VIX dropped 3.1% on Friday, finishing below 25 for the first time since June 21st. The 10 Year Bond moved up 0.3600 to 3.0560%. The fact that wholesale inventories for May met expectations was viewed positively.

YTD Stock Market Performance

The materials sector led the way after the Bank of Korea announced that it was raising its benchmark rate a full 25 basis points (to 2.25%), clearly confident that the global economic recovery is unlikely to stall. Some of the strongest performers in the materials sector included Monsanto (MON 51.17, +3.45), US Steel (X 42.88, +1.79) and AK Steel (AKS 13.38, +0.69). Gold posted a respectable gain.

The financial sector also saw robust performance, finishing 1.6% higher. Regional banks were at the center of trading activity, with Regions Financial (RF 7.14, +0.31), Huntington Banc (HBAN 5.92, +0.25) and Zions Bancorp (ZION 23.24, +0.86) finishing strongly. The larger investment banks shared investors’ confidence, with JP Morgan (JPM 38.89, +0.73), Bank of America (BAC 15.10, +0.24), and Citigroup (C 4.04, +0.07) all enjoying solid gains as a prelude to next week’s earnings announcements.

Light trading volume on Friday can be attributed to the fact that most investors want to limit their exposure prior to the start of the earnings season. Alcoa (AA 10.95, +0.23) will kick off the season on Monday when it releases its second quarter results. Undoubtedly, the week ahead will prove an interesting one.

In Europe, the FTSE 100 ended Friday’s session up 27.49 (0.54%), closing at 5,132.94. The DAX added 29.58 (0.49%), finishing at 6,065.24.

In Asia, the markets were largely unchanged.

Advancing Sectors: Consumer Discretionary (+1.0%), Energy (+0.4%), Financials (+1.6%), Materials (+2.4%), Industrials (+0.8%), Utilities (+0.6%), Technology (+0.6%), Health Care (+0.2%), Telecom (+0.2%), Consumer Staples (unchanged)

Declining Sectors: None Nasdaq +21.05 at 2196.45… NYSE Adv/Dec 2378/630… Nasdaq Adv/Dec 1979/642.

Be sure to follow our performance on Twitter and Facebook!

The ARTS Team

About: Absolute Return Trading Systems (ARTS), Inc. www.absolutereturnsystems.com

Absolute Return Trading Systems (ARTS) Inc. delivers market timing instructions to its subscribers from its proprietary algorithmic market timing software.  The system, designed by a team of researchers over more than a decade, is designed to produce positive returns in both up and down markets.  ARTS provides performance and risk information on 43 exchange traded funds (ETFs) and 21 stock market indices and has consistently been a top-ranked market timing service as measured by the leading third-party performance verification service, TimerTrac.

Popularity: 28% [?]

July 4, 2010

US markets closed down on Friday, with the NASDAQ dropping 9.57 to finish at 2,091.79 (off 0.46%), the S&P 500 sliding 4.79 to close at 1,022.58 (off 0.47%), and the Dow falling 46.05 to end at 9,686.48 (off 0.47%). The 10-year US Treasury Note added 3.98% (+4.00) to finish at 104.44. Stocks made a valiant effort to break a series of recent losses, despite disappointing employment data, but sellers managed to maintain their momentum. US nonfarm payrolls fell by 125,000 for June, outstripping expectations of a more modest fall, though private payrolls did better, adding 83,000. US unemployment numbers declined more than expected–to 9.5% from 9.7%–but this was largely the result of a contraction in the labor force. Factory orders for May slid 1.4%.

The markets responded to this downbeat economic data by taking stocks as much as 1% lower despite a short-lived rally that allowed them to reclaim some of the losses. By day’s end, however, stocks had fallen to their ninth loss over the past 10 sessions, giving up a full 9% of their value over the same period. Though some observers suggest that sellers are overreacting, the fact remains that a relative absence of positive economic data has given them solid grounds for pessimism, which remains remarkably persistent and pervasive. The S&P 500 and Nasdaq composite are flirting with a bear market—normally characterized by a drop of 20% off the highs. The Dow is faring slightly better, down 13.5% from the April highs versus a slide of 16% for the S&P 500 and 17% for the Nasdaq.

YTD Stock Market Performance

Consumer discretionary stocks fell 1.2%, financials dropped 1.1%, and industrials declined 1.0%. The materials sector was able to contain its losses—dropping a mere 0.3%–thanks to diversified metals and mining plays (+0.5%) and a compromise tax deal in Australia on mining profits. BHP Billiton (BHP 62.71, +0.29) gained on the news. Biotech plays added a healthy 1.8% on word that Sanofi-Aventis (SNY 29.40, -0.98) may be considering a still-unidentified multibillion dollar acquisition. Health care stocks advanced 0.3% overall. Verizon (VZ 26.81, +0.53) finalized its $8.6 billion spinoff of its local wireline operations to Frontier Communications (FTR 7.35, -0.34), with Verizon gaining and Frontier sliding markedly in response. Trading volume overall was robust.

Advancing Sectors: Health Care (+0.3%), Telecom (+0.2%), Utilities (+0.1%).

Declining Sectors: Consumer Discretionary (-1.2%), Financials (-1.1%), Industrials (-1.0%), Materials (-0.3%), Consumer Staples (-0.3%), Energy (-0.2%), Tech (-0.2%) DJ30 -46.05 NASDAQ -9.57 NQ100 -0.4% R2K -1.0% SP400 -0.7% SP500 -4.79 NASDAQ Adv/Vol/Dec 948/1.64 bln/1681 NYSE Adv/Vol/Dec 1209/1.10 bln/1812.

In Europe, the indices finished mixed at the day’s close, with the FTSE 100 having had the greatest change, up by 0.67%.

In Asia, the indices also closed mixed, with the most active market–the Hang Seng—finishing off 1.11%. The Nikkei was up 0.13%.

Overall, investors maintain a bleak outlook—one supported by a dearth of robust economic numbers. Fears of a double-dip recession are rising, with analysts deeply concerned about the relative failure of the US economy to add jobs in the absence of federal stimulus efforts.

Be sure to follow our performance on Twitter and Facebook!

The ARTS Team

About: Absolute Return Trading Systems (ARTS), Inc. www.absolutereturnsystems.com

Absolute Return Trading Systems (ARTS) Inc. delivers market timing instructions to its subscribers from its proprietary algorithmic market timing software.  The system, designed by a team of researchers over more than a decade, is designed to produce positive returns in both up and down markets.  ARTS provides performance and risk information on 43 exchange traded funds (ETFs) and 21 stock market indices and has consistently been a top-ranked market timing service as measured by the leading third-party performance verification service, TimerTrac.

Popularity: 39% [?]

June 28, 2010

The broader market enjoyed only modest gains on Friday, though a completed financial reform bill pushed banks and a variety of financial service firms sharply higher–snapping a losing streak stretching over four sessions. The reform bill, due to be passed shortly, forbids banks from taking untoward risks with their own money but does permit them to contribute to hedge funds and private equity funds. Though uncertainty over the bill’s ultimate impact remains, the market clearly responded to its finalization, with diversified financial services gaining 3.4%, investment banks and brokerages adding 3.1%, and specialized finance stocks rising 3.0%. The financial sector as a whole enjoyed a healthy 2.8% gain.

The materials sector also did remarkably well, energized by gold and silver stocks like Newmont Mining (NEM 61.67, +2.72) and diversified metals plays like Freeport McMoRan (FCX 66.57, +3.13). Some of these gains can be attributed to a sliding US dollar, which gave up 0.5% of its value against competing currencies such as the euro, which enjoyed a steady climb.

YTD Stock Market Performance

The Dow lost 8.99 (-0.09%) to close at 10,143.81, while the Nasdaq finished up 6.06 (+0.27%) to close at 2,223.48. The S&P 500 added 3.07 (+0.29%), ending Friday at 1,076.76. The 10-Yr Bond yield fell 0.10 to 3.11%.

Oracle (ORCL 22.60, +0.38) reported stronger-than-expected earnings and issued solid guidance, while Research In Motion (RIMM 53.26, -5.32) shares plummeted despite an earnings report that beat Wall Street expectations. A relatively mixed forecast clearly has investors concerned.

Advancing Sectors: Financials (+2.8%), Materials (+1.4%), Industrials (+0.6%), Utilities (+0.3%), Health Care (+0.2%), Consumer Discretionary (+0.1%).

Declining Sectors: Consumer Staples (-1.5%), Telecom (-1.2%), Tech (-0.6%), Energy (-0.1%).

Final first quarter GDP growth in the US was a sluggish 2.7% between January and March—well below expectations. Personal consumption growth was also soft at 3.0%.

In Europe, the FTSE 100 dropped 53.76 (-1.05%) to close at 5,046.47, the DAX lost 44.88 to finish at 6,070.60 (-0.73%), and the CAC 40 gave up 35.63 points to finish 1.0% lower at 3,519.73.

In Asia, the Nikkei fell 34.23 (-0.35%) to close at 9,703.25 and the Hang Seng remained flat at 20,690.79.

Oil gained $0.34 (+43%) to finish at $79.20 per barrel while gold remained flat at $1,255.80 per ounce.

Overall, the latest economic data and corporate headlines seem to have had little lasting impact on the market as a whole, though deficit-cutting proposals out of the G20 meeting over the weekend seem poised to move markets on Monday.

Be sure to follow our performance on Twitter and Facebook!

The ARTS Team

About: Absolute Return Trading Systems (ARTS), Inc. www.absolutereturnsystems.com

Absolute Return Trading Systems (ARTS) Inc. delivers market timing instructions to its subscribers from its proprietary algorithmic market timing software.  The system, designed by a team of researchers over more than a decade, is designed to produce positive returns in both up and down markets.  ARTS provides performance and risk information on 43 exchange traded funds (ETFs) and 21 stock market indices and has consistently been a top-ranked market timing service as measured by the leading third-party performance verification service, TimerTrac (www.timertrac.com).

Popularity: 37% [?]

June 20, 2010

Stocks began Friday down in the face of grim economic reports but recovered to post modest gains as investors favored commodity and consumer-related stocks. Slight gains capped a skittish week, with investors remaining nervous over economic uncertainty at home and abroad. Tuesday saw a positive run on the basis on successful debt auctions in Europe (see below), but doubts resurfaced later in the week. Additional reports, certain to move the market, will come next week: US housing data on Tuesday and Wednesday, durable goods and jobless claims on Thursday, and the third estimate for first quarter US GDP on Friday.

YTD Stock Market Performance

The blue chip Dow Jones industrial average finished 16 points higher on Friday to close at 10,450 (up 0.2%). The advance was led by Alcoa, up 2%, Travelers, up 1.7% and General Electric, up 1%. The NASDAQ was boosted significantly by strength in the tech sector, adding 0.1% to close at 2309. The broader S&P500 index posted a modest 0.1% gain to finish at 1117, benefitting from moves into utility and consumer staple shares; six industry sectors gained on Friday, including utilities (+0.7%), consumer goods (+0.4%), technology (+0.4%), health care (+0.1%), oil and gas (+0.1%), and industrials (+0.03%). Underperformers included basic materials (-0.5%), consumer services (-0.3%), financials (-0.2%), and telecommunications (-0.1%). In the broad market, advancing issues beat decliners by a margin of more than 5 to 4 on the NYSE and by nearly 5 to 4 on the Nasdaq. The S&P 500 is off about 8 percent since reaching a recent high on April 23. For the week, the Dow and the S&P added 2.4% and the Nasdaq gained 3%.

U.S. Treasuries edged higher as investors sought security. The 10-year moved up to 20/32 with its yield dropping to 3.192%. Gold prices also benefitted from the search for a safe-haven, reaching an unprecedented high of $1,247.50 (up $18.20). Record gold prices lifted mining shares significantly, boosting the market as a whole. Crude prices on the New York Mercantile Exchange shed 84 cents to finish at $76.83 per barrel.

Despite continuing global concerns over Europe, the euro hit a three-week high, prompting many to speculate that a full-fledged economic recovery is on the horizon. Strong demand for 10- and 30-year Spanish government bonds helped to boost confidence as Spain raised close to $4.3 billion through the offerings. Austerity measures in Greece were also welcomed by investors, though serious concerns persist.

The FTSE 100 dropped -3.05 on Friday to finish at 5,250.84 (-0.06%). The Nikkei was off -4.38 to close at 9,995.02 (-0.04%). The Hang Seng Index responded to relatively positive movement in the US to finish at 20,286.71 (+148.31) (+0.74%). The Thomson Reuters Equity Global Index reached 140.26 (+0.32) (+0.23%).

On the whole, uncertainty continues to pervade the market as investors seek signs of a more stable and sustained global economic recovery.

Be sure to follow our performance on Twitter and Facebook!

The ARTS Team

Absolute Return Trading Systems (ARTS), Inc. www.absolutereturnsystems.com

Absolute Return Trading Systems (ARTS) Inc. delivers market timing instructions to its subscribers from its proprietary algorithmic market timing software. The system, designed by a team of researchers over more than a decade, is designed to produce positive returns in both up and down markets. ARTS provides performance and risk information on 43 exchange traded funds (ETFs) and 21 stock market indices and has consistently been a top-ranked market timing service as measured by the leading third-party performance verification service, TimerTrac (www.timertrac.com).

Popularity: 21% [?]

June 14, 2010

Stocks finished the week strong despite a discouraging monthly retail sales report that many feared would roll back the prior session’s surge. On Thursday, the S&P 500 spiked 3%, but a highly negative Advance Retail Sales report gave many investors an excuse to take profits—at least in early trading. The report confounded expectations with data indicating a retail sales drop of 1.2% in May. ‘Sales less autos’ followed the same pattern, falling 1.1%–the worst decline in over 12 months. That said, for the week as a whole, the Nasdaq enjoyed a gain of more than 1% (+1.0% for the session) while the Dow added 2.8% (+0.38% for the session). Despite profit-taking, the S&P 500 still finished 2.5% ahead for the week as a whole (0.44% for the session), though it is down more than 2% since the beginning of the year.

Stocks were partially buoyed by a major Consumer Confidence Survey indicating a two-year high of 75.5—above the expected 74.5. Business inventory data for April had little effect on trading, with inventories increasing 0.4% for the month. Economic data were extremely contradictory, as has been the case over recent weeks and months, and uncertainty among investors generally kept stocks within a fairly tight range. Light volume likely contributed to heavy swings, leaving stocks at session highs by Friday’s end.

YTD Stock Market Performance

Microsoft (MSFT 25.66, +0.66) helped to prop up the Nasdaq with stronger-than-expected earnings and upbeat guidance put National Semiconductor (NSM 14.21, +0.68) among the leaders of the broader S&P 500 (NSM 14.21, +0.68). Both pushed tech stocks up 1.1%–a figure eclipsed only by the materials sector, which saw a 1.2% rise. Health care stocks mirrored tech advances, jumping 0.8% in the wake of Citigroup’s positive re-evaluation of Bristol-Myers Squibb (BMY 25.08, +0.44). Airline stocks were also a source of strength.

Consumer staples stocks did not impress during Friday’s session, finishing with a 0.8% loss. Tobacco, household products, and soft drinks featured prominently among the sector’s worst performers.

In Europe, the FTSE closed up 0.61% on Friday, while the DAX slipped 0.14%. In Asia, the Nikkei finished Friday’s session with a 1.71% gain, while the Hang Seng added 0.99%.

July crude oil fell 2.2% to $73.78 per barrel on the basis of uncertain or negative economic data, while July natural gas gained 2.2% to close at $4.78 per MMBtu—possibly on the basis of forecasts of warm weather across much of the US. Gold prices finished up by 0.6% to close at $1230.20 per ounce, while July silver slipped 0.6% to close for the week at $18.23 per ounce.

On the whole, conflicting economic data continue to affect confidence and impede market growth, with continuing economic instability in Europe reinforcing the sense of uncertainty.

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Absolute Return Trading Systems (ARTS) Inc. delivers market timing instructions to its subscribers from its proprietary algorithmic market timing software. The system, designed by a team of researchers over more than a decade, is designed to produce positive returns in both up and down markets. ARTS provides performance and risk information on 43 exchange traded funds (ETFs) and 21 stock market indices and has consistently been a top-ranked market timing service as measured by the leading third-party performance verification service, TimerTrac (www.timertrac.com).

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