What a wild session with a lot of ups and downs yesterday; by the closing bell, the S&P was off for the fifth session in a row, which never happened last year. Bad news from bank earnings coupled with the shocking announcement that Switzerland has given up pegging the Franc to the Euro were to blame for the volatility.

However, there was one clear winner from the Swiss news as gold took off big time nearing a major breakout through the top of the trading channel.

I mentioned at the start of 2015 that I was looking for a bounce in gold this year, perhaps to $1,400 or higher. With the European Central Bank (ECB) moments away from triggering more money printing, gold may finally be ready to shine (no pun intended).

 

Money Printing Around the World

Once the ECB joins the game and Japan tries even more tricks, I do not see the U.S. dollar pulling back; however, some think it could spark the stock market.

If it were not for the volatile nature of the collapse, many would be saying oil has hit a bottom, but the last couple of days look like a classic reversal. Tuesday afternoon, crude oil prices flirted with $44 a barrel, making a series of higher highs and higher lows.

While Wall Street has ulterior motives for rooting for a bounce in crude oil, there are potential benefits for business that could have a greater impact on portfolios than the oil stocks rebounding.

Yesterday, in the Philadelphia Fed Report, a supplemental survey on oil stated the obvious by listing the following benefits in perspective for business.

Business Impact from Cheaper Oil
Positive	62.9%
None	15.7%
Negative	15.7%

Manifestation of Cheaper Oil
Lower Firm Cost	57.1%
Lower Revenue	10.0%
Increased Sales Margin	22.9%

I think businesses and consumers alike will begin to reflect cost savings from lower crude oil with the former hiring or investing.

Today’s Session

The deflation debate could gather steam this morning after the CPI report came in at -0.4, in-line with consensus, and the biggest decline since 2008 driven by energy's free fall.

Yet, since the news release, equity futures have begun to stage a rebound. Core inflation, which strips out food and energy, was unchanged, providing some relief and bolstering the notion crude oil is a unique story of supply and demand where the former simply outgrew the latter.

Today ends the first official week of earnings season. Below are some of the companies that reported yesterday afternoon and this morning:

Company	EPS	Consensus	Revenue ($M)	EPS Guidance	EPS Consensus
INTC	0.74	0.66	$14,721	-	(FY15) 2.37
SLB	1.50	1.46	$12,641	-	(FY15) 4.81
GS	4.38	4.32	$7,690	-	(FY15) 17.28
PNC	1.84	1.73	$3,947	-	(FY15) 7.26

Comments

As a viewer of Dish I can't begin to tell you how much I have missed you on TV. Though have no idea how horrible it was horrible being forced to watch CNN. At least I had the Internet. Looking forward to Making Money this evening. Fran Touchette on 1/16/2015 10:52:44 AM

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