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Wall Street, California: Quarterly Review and Outlook

Stock Market Barometers

March 31, 1998

Fundamental and technical indicators of the market's health

Key indexes vs. their 200-day moving averages:

A stock index's 200-day moving average indicates the basic trend, up or down. It is generally bullish if the index stays above the average.

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S&P 500 (blue-chip stocks): Friday: 1,095.44

200-day moving average: 960.94

Russell 2,00 index (smaller stocks): Friday: 477.15

200-day moving average: 432.76

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Price-to-earnings ratio of the Standard & Poor's 500: 27.54

Based on actual earnings per share, 12 months ended Dec. 31

Average since 1923: 13.5

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Dividend yield of the Standard & Poor's 500: 1.45%

Average dividend yield of blue-chip stocks

Average since 1923: 4.5%

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Weekly new highs vs. new lows on the NYSE: 617/81

Data for the week ended Friday. More highs than lows is preferable, indicating a bullish trend.

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Investment newsletter sentiment:

Stocks' near-term trend as predicted by 135 independent investment newsletters, weekly survey by Investors Intelligence. The data are often viewed as a contrarian indicator: A rising percentage of bulls can signal a topping market.

Bullish: (MARCH 20th) 48.0%; (FRIDAY) 49.6%

Bearish: (MARCH 20th 27.6; (FRIDAY) 26.4

Correction: (MARCH 29th) 24.4; (FRIDAY) 24.0

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Put-call ratio: 0.41

The ratio of stock put options to call options traded last week on the Chicago Board Options Exchange. A low put-call ratio--under 0.40--can be construed as bearish because it indicates a high level of optimism, leaving a lot of room for disappointment.

Source: A.G. Edwards & Sons. More information can be found at http://www.agedwards.com on the World Wide Web.

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