Monday, December 22, 2014

IS A PAUSE IN THE MARKETS COMING?

WASHINGTON (Reuters) - U.S. home resales tumbled to a six-month low in November after two straight months of strong increases, underscoring the uneven nature of the housing market recovery. The National Association of Realtors said on Monday existing home sales dropped 6.1 percent to an annual rate of 4.93 million units, the lowest level since May. October's sales pace was revised slightly down to 5.25 million units from 5.26 million units. November's decline probably does not signal the start of a weakening trend and in part reflected stubbornly low inventories. Economists polled by Reuters had expected sales to fall only to a 5.20-million unit pace. Housing has struggled to shift into higher gear after stagnating in the second half of 2013 in the wake of a jump in mortgage rates, which have since pulled back from their peaks. It has lagged an acceleration in economic activity as tepid wage growth, a shortage of properties available for sale and higher home prices sidelined first-time buyers.
CERRFINANCE - Rising home prices and fewer first-time home buyers would normally cause a decrease in market prices however with decreasing oil prices things are still looking positive.  In addition, Feds continual support for free money we expect will continue to drive the market until next year. Looking for new Congress to mess up things by threatening government shutdown, balance budget tightening, or sequester. 
TD AMERITRADE -  Natural Gas Sinks 9%.  Commodities are trading mostly lower this morning, while the dollar index is trading modestly lower.The index has been in negative territory all day so far, which has helped provide a little support in select commodities this morning, but not too much.Natural gas futures are the worst performing commodity today in the commodities complex and dropped sharply lower.This weakness comes on mild weather forecasts and inventory that's above year-ago levels, causing front-month natural gas to fall more than 9% lower. Jan nat gas is now -9% at $3.15/MMBtu. Metals and oil futures are all sitting near today's lows. Feb crude oil has been sliding lower since the overnight low of $58.53/barrel and is now -2.2% at $55.90/ozFeb gold is currently -0.1% at $1195/oz, while Mar silver is -0.5% at $15.94/oz.  EnergyThe Energy sector is down today, losing 1.35%, with all of its underlying industries lower. Energy Equipment & Services is weakest, falling by2.15%. Over the last month, the Energy sector is down by12.62%, led lower by Energy Equipment & Services and Oil, Gas & Consumable Fuels industries, which are off 16.74% and 12.07%respectively.
CERRFINANCE - It looks like volatility will definitely be around in the beginning of next year. It might be best to pause and see what happens either geopolitical or industrial. Everyone is pulling out of metals and oil. Home prices are rising and becoming scarce.  Next year will be exciting and gaining new profits will be a challenge. 

Wednesday, December 10, 2014

Oil Prices Making Markets Nervous

(Market Watch) Shale oil:   It's impossible to talk about oil’s plunge without talking about the supply glut. And it’s impossible to talk about the supply glut without talking about U.S. shale. Persistently high oil prices helped to spur the fracking revolution, which in turn triggered a boom for North Dakota and other shale-oil-rich regions.  Falling prices will weigh on production of oil from shale and other resources as energy firms cut back on projects, but investors are debating exactly how sensitive shale production will prove to be.
“In fact, we can even imagine initially higher output, as many shale players will scramble for survival and cash flow becomes crucial,” wrote analysts at JBC Energy. “This will push them to reduce the backlog of already drilled and fracked wells, while focusing new wells on their most promising assets.”
On Wednesday, the U.S. Energy Information Administration reported a surprise increase in U.S. supplies of 1.5 million barrels in the week ending Dec. 5., which may reflect the push for producers to squeeze as much oil from their existing sites now as possible.It’s not just the U.S., other major producers are also pumping away. OPEC, meanwhile, is keeping the spigots open in what many strategists see as nothing less than a price war aimed at routing shale and other higher-cost producers. The cartel opted at a closely watched November meeting to make no changes to its production levels, prompting another jarring decline for oil futures.
“This makes any rapid recovery of oil prices unlikely, especially as additional supply looks set to reach the market from northern Iraq and Libya,” wrote Carsten Fritsch, commodity strategist at Commerzbank in Frankfurt.
(CERR Investments): Wow oil prices declining due to a fight between shale and OPEC. Now we can see that people are just searching for profits and who can make it more expensive for the other guy to drill.  This is going to have drastic effects on the world economy with shrinking budgets. Countries that depend largely on oil revenue will soon have to show their hands that they will have to do new things to make revenue. This is already having effect on stocks. Small Cap and European funds are already starting to show pressure. We will see in the future if the DOW and S&P will began to show any pressure. So far they have pause and are going sideways. Look for a fed meeting to change the dynamics of the things - either rate increase or a further pause to spur the economy again.  I expect the Feds to raise now since there is no longer an election.