U.S. ETFs And Stocks Limp Into Weekend Before Election

Major U.S. index ETFs and stocks lost ground on Friday as New York and the East Coast struggles to Recover from the damage of Hurricane Sandy. Friday’s trading session capped a historic week that saw the first two-day weather related close of the New York Stock Exchange since 1888.

The week was packed with economic reports that were largely positive and earnings reports that were mixed, but the headline grabber, of course, was Super Storm Sandy, its devastation and its potential impact on Tuesday’s U.S. Presidential election.

On My ETF Radar



In the chart of the S&P 500 ETF (SPY) above we can see how relative strength and momentum are declining, as represented by RSI and MACD, the index is in a downtrend and recently formed a triple top which is a bearish technical indicator. The S&P 500 (NYSEARCA:SPY) is also below its 50 day moving average (blue line) and failed to break above that level in Friday’s trade. The only good news on the chart of this ETF is that it remains above its 200 day moving average (red line) which indicates that the ETF is still in a longer term uptrend.

ETF News You Can Really Use

In economic reports for the week, October’s widely anticipated Non Farms Payrolls report registered a 171,000 compared to a forecast 120,000 and last month’s 148,000. The overall unemployment rate climbed slightly to 7.9% from last month’s 7.8% and so these numbers provided fodder for both political campaigns as it was the last major look at the employment picture going into Tuesday’s election.

Also on Friday, factory orders for September jumped to 4.8.% from last month’s -5.1%.

Earlier in the week, October ISM came in virtually flat at 51.7 for the month but beat expectations, weekly jobless claims declined and October consumer confidence hit 72.2, the highest level in over four years.

Major U.S. ETFs:

Dow Jones Industrial Average (DIA) -1.05% on Friday and -0.1% for the week.

S&P 500 (SPY) -0.94% on Friday and +0.16% for the week

Nasdaq 100 (QQQ) -1.16% on Friday and -0.3% for the week.

Russell 2000 (IWM) -1.6% on Friday and +0.1% for the week.

Gold (GLD) $1678.8/oz, down 2.17% on Friday and -1.95% for the week.

Oil (USO) $84.86/bbl, -2.26% on Friday and -1.38% for the week.

This coming week brings one of the tightest and most closely watched Presidential elections in history, along with significant economic reports including Non Manufacturing ISM, weekly jobless claims and University of Michigan Consumer Confidence.

But the most significant news makers will be the ongoing recovery effort from Hurricane Sandy and how that progress is perceived going into Tuesday’s election and what impact the storm’s aftermath might have on each party’s efforts to get their supporters out to the polls.

After Election Night draws to a close, we’ll have a newly elected President and new Congress, and they will have no honeymoon as the “fiscal cliff” will immediately rear its ugly head with its December 31st deadline, now less than 60 days away.

Bottom line: A chaotic week last week on the East Coast led to more uncertainty in U.S. and global financial markets. This coming week we learn the outcome of Campaign 2012 and then face the rapidly approaching fiscal cliff. Many challenges lie ahead with not much time to solve them.

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