Under the shadow of the giants

The market is under earning spell, and today it is operated under the shadow of earning from AAPL.  Even a receding of oil price and a rising dollar cannot provide enough momentum to power the market higher; nobody wanted to bet for or against AAPL.  Obviously, the macro economy was not friendly to AAPL, but AAPL always had the magic to pull it over in the past.  

 

The after market seems like investors did not like the number, but, in reality, the earning is great, and AAPL has always lowball their future earnings, so, I do not expect market will react negatively against AAPL tomorrow.

 

Tomorrow, the market is going to under the shadow of MSFT, but if INTC is any indication, MSFT will come out fine. Even though one cannot reliably predict future, it is probable that we will see a flat or even higher market tomorrow.

 

 Finally, somebody tired of take POT, CF etc even higher, and took the profit.  I was trying to short EXM, but my online broker said there is no share available for short, and I was not quick enough to associate the stock with DRYS.   I am not saying that those stocks will go down from here, but, on the chart, they look so parabolic, and EXM and DRYS open higher/close low do not bode well for tomorrow. Let’s see.

 

Chinese stocks become alive lately. Not long ago, people thought that there would be no problem before Olympics, but the threat of global recession has cut the value of Chinese stocks by half. Now, government is stepping up to “save” the market, thus, we can expect a rally towards Olympics.  And that is exact what it means that there will be no problem before Olympics, the government will do anything to make the society harmonious J

 

One Chinese stock is of particular interesting, SNP, it did not participated in the oil run, but today it reverse its downtrend on a higher volume.  The problem with SNP is that it cannot raise its price because government forbids it doing so.  So, the higher crude price actually will hurt its earning, that is why it did not participated in oil boom.   Two developments will help the price. 1). If our premise that oil will take a breath, then, that will help the company.  2). The government will redeem some of the loss of the company, meaning the government will subside the company, that also will help the stock.

 

For agriculture business and other commodities, we can expect a short “pause”, but the fact that they are in a secular bull market is in no doubt, we can wait for them back trace to their support line, and we can buy from there.

 

Good luck