Courtesy of John Nyaradi.
U.S. stocks and ETFs make good start to 2012
In the holiday shortened week, major U.S. stock indexes and sectors advanced to finish positive for the first week of 2012.
The Dow Jones Industrial Average gained 1.2% for the week while the S&P 500 (NYSEARCA:IVV) added 1.6% and the Nasdaq (NYSEARCA:QQQ) added 2.7% and the small cap sector represented by the Russell 2000 (NYSEARCA:IWM) climbed 1.4%.
The commodity complex also had a good week, paced by gains in gold (NYSEARCA:IAU) of 3.4% and silver (NYSEARCA:SLV) adding 3.5%.
The gains came largely on the back of good economic news, including today’s Non Farm Payroll and Unemployment Reports.
December Non Farm Payrolls came in at 200,000 new jobs compared to 100,000 in November and an expected 150,000.
December Unemployment Report numbers declined to 8.5% from 8.7% and both numbers were widely heralded as good news for the economy, although everyone seems to agree that at this rate it will take years for unemployment to make a meaningful decline.
Still, Secretary of Labor Hilda Solis pointed out that unemployment is now at its lowest levels in almost three years, mass layoffs are declining and initial unemployment claims have remained below 400,000 for the past four weeks which is the first time at those levels since June, 2008.
However, Friday’s action turned red on worries over Europe’s debt problems and with both Spanish and Italian bond yields rising.
Bottom line: A positive first five days in January has been shown to generally lead to positive years and so early action in 2012 bodes well for the future. However, problems in Europe continue to simmer and surely Europe will be a factor in 2012′s stock market action
Disclaimer: Wall Street Sector Selector actively trades a wide range of exchange traded funds (ETFs) and positions can change at any time.
Click here to learn more about John’s book and for a free membership to Wall Street Sector Selector
