The Kirk Report

Market Malaise

If it looks, acts, and smells like pure profit-taking, then it probably is.

Rising bond yields and Bernanke seemed to be easy scapegoats for today's market malaise, but other than uninspiring performance across the board (more than 10 stocks fell for every three that gained on the NYSE), I didn't see much to worry about. In fact, the bulls managed to make sure that they didn't show any signs of weakness by managing to close above the 1530 level in the S&P 500 I referred to earlier today.

See you tomorrow!

Good Minds Think Alike

Now it is time to update the bad with the good.

My screen based on the recent buys of top-performing portfolio managers with outstanding long-term track records was not impressive. This screen had worse than mixed performance (19 gainers & 20 losers) with a 0.76% gain overall. Compared with the market's performance, that's quite disappointing. While no big duds were seen (only 3 stocks fell more than 7% over the past four weeks), there were only a little more than equal amount of outperformers (only 4 stocks with gains above 8%). Here is the performance tracking data.

Fortunately, with today's monthly update there was quite a bit of turnover, so let's hope these pros have done a better job this time around. What I've seen from tracking this portfolio in the past is that it either performs really well or just moves sideways (like last month). What is unusual is to see the portfolio perform poorly when the market is advancing, but many of us have witnessed the same thing watching our own portfolios of late.

Bernanke, ISM, and 1530 on the S&P

Good morning. Bernanke is out with upbeat comments about the economy this morning but investors don't seemed all that impressed especially since so many want to see the Fed cut interest rates. Some profit warnings from the retail sector (see BBBY & CACH) along with more M&A activity (AV) have investors waiting for today's release of the ISM non-manufacturing report at 10:AM. The market expects the index to hold steady at 56.0, the same reading as in April.

Investors also continue to watch Shanghai with amusement while I keep hearing that 1530 on the S&P 500 is a critical for the U.S. It is at that level where the buy the dippers could surface again on additional weakness so failure of that would indicate to some an important break in the upward momentum. I suspect that today's ISM reading holds the key for the day. Have a terrific Tuesday!