Equities and the Economy

Well it appears Santa finished delivering his presents on Tuesday for yesterday he was nowhere to be found. The Dow fell 117 points, 0.66%, ending at 17,604, the S&P 500 lost 15, 0.74%, to 2,063 and the Nasdaq closed down 42 points, 0.82%, at 5,066. In the holiday thin market investors and traders don’t have much to key on so they’re once again they focused on oil prices, which fell yesterday. Remember earlier in the week, specifically Tuesday, oil prices rallied and so did equities. Folks, although there’s some volatility, trade volume is very light. For example, yesterday’s volume was one of the lowest of the year. Today could be one of those portfolio adjustment days.

So let’s just move on to this morning where the U.S. market is following European markets which are trading lower with the Dow down 108 points. Again, on very low volume. If we close at these levels the S&P close in negative territory for 2015, albeit ever so marginally. Now I’m a glass is half full guy so let’s put this in perspective. The last three consecutive years the S&P has had double digit gains.

The only economic report of any importance yesterday was the National Association of Realtors pending home sales for November which came in at 107, just below October’s 108. This was a slight disappointment but we must remember that y-o-y sales are up a solid 2.7%. Pending sales peaked out in the spring of this year but remain healthy

Oil

Yesterday the DOE confirmed Tuesday’s API report of crude inventory increases last week. On an aggregated basis (crude, gasoline and distillates) inventories rose 5.3 million barrels with estimates being a 2.3 million barrel increase. This could be viewed as nothing but bearish with traders coming in and selling pushing WTI down $1.27 on the day closing at $36.60. Brent was also sold closing down $1.33 at $36.46. They also reported that U.S. crude inventories, not including the SPR, are close to 490 million barrels rivalling the peak sum earlier this spring.

This morning oil traders are apathetic for WTI is basically unchanged from yesterday’s closing price.

Courtesy of MDA Information Systems LLC

Natural Gas

The weather forecast yesterday morning shifted materially warmer in the 6-15 day time frame which sent natural gas prices tumbling and now prompt month February contract closed down a material 15.6¢ at $2.214. This morning natty is up 13.1¢ as the 11-15 time frame shifted colder, but still above normal in the east. More importantly, one of the weather models, it’s called the European Ensembles, is hinting that some widespread and intense below normal temperatures could be coming to most of the U.S. With the long weekend ahead and the possibility of some cold weather shorts are covering.

Elsewhere

Being it’s New Year’s Eve it is most definitely appropriate to share some facts and trivia.

The first New Year’s Eve was celebrated by the ancient Babylonians 4,000 years ago.

It’s tradition to ring in the New Year’s with family and friends because the first people you see will either give you good luck or bad luck. Keep friends close and foes far away!

More vehicles are stolen on New Year’s Day than any other holiday per the National Insurance Crime Bureau.

The top three places to celebrate New Year’s Eve are Las Vegas (duh!), New York City, and I bet you wouldn’t have guessed this one, Disney World.

The Times Square New Year’s Eve Ball was first dropped in 1907 following a fireworks ban. Back then, a 700 lb. ball embellished with 25-watt bulbs made of iron and wood was dropped. Now it weighs 11,875 lbs., is 12 feet in diameter and is adorned with 2,668 Waterford crystals.

In Italy, people wear red underwear on New Year’s Day to bring good luck all year long.

And finally, the traditional New Year’s song, Auld Lang Syne,” means “times gone by.”

Have a wonderful holiday weekend and I wish you a very happy, healthy and prosperous New Year!