Some examples for you of how the market is doing what is completely unexpected and/or wacky.
a) Amazon tanks two days ago and goes up steadily since, $10 from the Tuesday’s lows I think.
b) Las Vegas Sands reports inline earnings but does okay on revenues. The stock has run up nearly 20% in the last several weeks in anticipation of blowout results which did not happen, but of course it actually closes up. (BTW, several weeks ago, good Macau numbers were reported and both it and Wynn tanked 10% right after. I remember taking a position and losing money on it!)
c) Patriot Coal reports terrible results and goes up 10%. So do many coal stocks.
d) Baidu postpones earnings announcement day saying something weak like it will do so after the Chinese New Year. Usually, this is a red flag, it actually was for 1 day as the stock promptly dropped $5 the next morning, but is back up to where it was before they announced the change.
e) Some news comes out that Israel is going to attack Iran sometime in the next several months and crude oil pops after having gone steadily down since yesterday.
f) Recent data suggests that individual and hedge funds are woefully underinvested. That is not surprising considering how much they have lost, considering how program trading has ruled, and I suppose anecdotally the impact of Occupy everything. Indeed, this prompted Doug Kass, who I have been reading for years to come out and argue the contrarian position that 2012 may end up being a great year for the S&P.
Clearly people are jumping into anything that is down for any reason. The low daily volume makes all these observations a bit less credible though, but low volume has been the story for the last several years. Perhaps the market is waiting for tomorrow’s employment news or for next week’s Greek bailout (or not) news. Maybe both will be just snoozers. Low volume and low volatility means one has to play high beta stocks for any juice. Chipotle missed and was down $10, GMCR beat and was up 20%. I ate lunch at the former and it was pretty bad. But they are growing and the lines were long.
These are just random thoughts as I sit in the Hall of Justice after having been summoned and excused once. They put me in a 4-week trial and I pleaded with the judge that I had over 100 students who would be affected if I had to rearrange classes for that much time. I may still get assigned to another trial. Meanwhile you should be glad this building has wireless and I can go on and on about stuff.