Commentary

George Chamberlin

GEORGE CHAMBERLIN has been associated with The Daily Transcript at SDDT.com since 1998 and became Executive Editor in 2006. He is responsible for the development of editorial strategies for the newspaper and website. He has introduced video and audio into the editorial products and is the public face of the company at many community events. George regularly chairs industry roundtables and conducts video interviews of participants for use on the San Diego Source. He writes two daily columns, "Money in the Morning" and a daily stock market wrap-up.

George, a long time resident of North County, lives in Vista with his wife Terry.

From the Executive Editor

Fear, not greed, moved investors last week. The decision to step away from stocks Friday was driven by concerns that the global tensions could escalate over the weekend and traders decided it was better to be safe than sorry. The Dow industrials dropped 123 points and finished the week with a loss of 0.8 percent. Most of the decline in the Dow was the result of a sharp sell-off in shares of Visa. The stock dropped $9.87 to $212.87 after reporting good numbers for Q2 but a cautious outlook for future sales. The Dow is what is called a price-weighted index, so the decline in Visa resulted in 63 of the 123 points lost Friday.

Financial markets were little changed Monday as investors await a key series of economic reports and merger activity and optimism over corporate earnings offset concern over crises abroad.

Who let the bears out? The week is ending with investors reacting to some disappointing earnings reports -- actually, disappointing forecasts -- by some bellwether companies. Shares of Amazon, Starbucks, Visa and other companies that released Q2 updates after the close yesterday are opening lower and dragging the major indexes down with them. Of course, the trading is on light volume so the declines don't really count. The bears always use that excuse when the markets are going up, so we bulls can say the same thing when stocks are going down.

The 45,000 employees of Southwest Airlines, including hundreds here in San Diego, got a pleasant surprise in their paychecks last week: a $200 bonus for helping the carrier achieve some difficult financial goals.

Twenty-six. That's the number of times the S&P 500 has closed at an all-time record high so far in 2014 including yesterday. In a very quiet, summerlike trading session, the Dow industrials were down 27 points yesterday but the S&P 500 was able to eke out a gain of 3 points, enough to take it to a record close. Sam Stovall of S&P Capital IQ commented this morning about people who keep predicting a stock market crash. "A wise man once said, after asked if he ever tried to anticipate signals from his indicators, 'Whenever I try to jump the gun, I only end up shooting myself in the foot.' The market continues to remind investors that the trend remains their friend."

Corporate earnings reports continued to drive stock market activity Thursday. The balance between positive and negative reports led to a standoff on prices.

While report after report shows a rebounding economy, households and consumers across the country and in San Diego seem hesitant to break out of the gloom caused by one of the deepest and longest-lasting recessions in the nation's history.

Waiting for something to happen. Stocks seem to be meandering these days, as they often do during the summer, waiting for something to happen that will move the markets one way or the other. Any selling -- as was the case last Thursday when the Dow industrials dipped 161 points after the crash of the Malaysia airliner -- is usually followed by opportunistic buying. For the time being, the markets will be reacting to earnings reports, one at a time.

The stock market was mixed Wednesday as investors continue to digest corporate earnings reports for the second quarter.

Watching the world. Yesterday was another one of those days when the markets were affected more by events around the world than economic news here at home. The Dow industrials fell triple digits at the start of trading in reaction to the tensions surrounding the aftermath of the crash of the Malaysia Airlines plane in Ukraine as well as the conflict in the Gaza Strip. However, at the close the Dow was down just 48 points, 0.3 percent.

Every down day is a buying opportunity. That seems to be the way things are on Wall Street these days. Thursday was a tough day as the Dow industrials fell 161 points after the news reports of the crash of the Malaysia Airlines plane and the escalation of attacks in the Gaza Strip. However, investors did not dwell on the news and the Dow bounced back 123 points on Friday, the fifth up day in the past six sessions. The index closed at 17,100, just 38 points away from a new high. Year to date, the Dow is up 3.2 percent, but has actually been outdone by the Standard & Poor’s 500 (up 7.0 percent) and the Nasdaq Composite Index (up 6.1 percent).

Stock prices were lower Monday as investors continued to focus on the consequences of global events including the downing of the Malaysia Airlines plane, the rising tension in the Gaza Strip and concern that tension in Ukraine could lead to deeper sanctions against Russia.

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