Readings: Rupee weakness, Trading during results, Russell on rally
The currency fell 2.8% from Monday’s closing of 40.61 per $1, ending Thursday at 41.74 per $1. The currency has suffered its biggest three-day loss since March 1996 this week, sliding a total of 5.4% this year.
The gap between India’s imports and exports also increased to $80.4 billion largely due to a 27% rise in imports to $236 billion in the year ended March 31, government figures said on May1.
The fact that the RBI hasn’t stepped in to defend the currency is goading the analysts to predict the short-term weakening. Rohan Lasrado, head of inter-bank foreign exchange at HDFC Bank, expects the RBI to protect the rupee only after it reaches 43:$1.
- Stocks in the top 1% of prior year returns generate an average market-adjusted return of +1.58% (-1.86%) during the five trading days before (after) earnings announcements, excluding trading frictions.
- within this set of high-fliers, stocks with earnings announcements unambiguously occurring outside of normal trading hours generate an average market-adjusted return of +3.09% (-3.05%) during the five trading days before (after) earnings announcements, including a significant close-to-open average return of +0.93% immediately after announcements as part of the pre-announcement return. In other words, going long these stocks five days before earnings announcements, closing the long positions at the first open after announcements and then shorting until the close five days later generates an average market-adjusted ten-day return of over 6%, excluding trading frictions.
- BeEarly/Barrons: A Rally With Serious Muscle
The 50% Principle, named by Schaefer, tells us that the primary trend of the market remains intact and bullish if the Dow doesn’t break below this midway point in the course of a pullback. Schaefer, who applied his studies to the Dow, emphasized that this tool should be used only in reference to major market movements, not short moves . . .
The findings of the 50% Principle are confirmed by other technical trends. The Dow made a closing low of 11,971.19 on Jan. 22, a session in which 1,114 stocks, or one out of three, hit new lows on the New York Stock Exchange. Since then, the new-lows list has contracted dramatically, which means stocks are pulling back on down days but not breaking support — an important difference.
Hmm.
