Earnings Data Could Make for a Rocky Day

By Jim Farrish | July 18, 2008 | 9:35 AM | 0 Comments

Natural gas fell more than 7% yesterday on the continued decline in oil prices. As we discussed on Wednesday’s blog this leave the ETF (AMEX: UNG) at support near the $50 mark. The next support level is $45. I would continue to watch for opportunities at both of these levels for a bounce on this aggressive selling.

 

 

Coal was another sector punished by the decline in oil prices over the last few days. The index dropped more than 9% yesterday. This took the ETF (AMEX: KOL) below support at the $50 mark. The next level of support is near the $45 level. This is worth watching as well near term to see if we bounce off these levels of support. Oil will be the catalyst so pay attention to (AMEX: USO) as well.  USO broke the support of $108 leaving room for a decline near the $100 mark.

 

 

Financials made it two days in a row to the upside with the sector up more than 5% on the day. Banks were up nearly 10% and 24% over the last two trading days. I discussed yesterday if we had established a bottom? While I won’t commit to a yes answer the bounce helped put some distance in sector and some scanning is a worthwhile investment. A couple of stocks worth looking at near term are Hudson City Bancorp (NSDQ: HCBK), Danvers Bancorp (NSDQ: DNBK), and Seacoast Banking Corp (NSDQ: (NSDQ: SBCF). These are small cap bank stocks and have little to no exposure to the mortgage business. They are guilty by association and worth researching further. I continue to look here for value other than the obvious big plays in the Bank of America (NYSE: BAC).

 

 

Today could be rocky with the earnings data in the technology sector not to the liking of many investors. Google missed and disappointed analyst. Microsoft’s earnings were solid, but revisions to the outlook disappoint . (NYSE: IBM) beats and guidance was positive. There is still plenty for the market to trip on short term. Be patient in building positions. Stick to your discipline and know what your goal is prior to taking positions.