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With just one session left in the month, those who follow the January Barometer are feeling pretty good right now.

By Alexandra Twin, CNNMoney.com senior writer

January 31 2007: 10:42

NEW YORK (CNNMoney.com) -- Investors, you'd better not send the mkt lower Wed, no matter what the Federal Reserve does or doesn't say at 2:15 p.m.

If the S&P 500 ends the month lower, there'll be hell to pay.

Well, not quite, but according to the January Barometer, one of the more reliable market indicators around, "as January goes, so goes the year." And January is going well, despite a shaky start.

According to the Stock Trader's Almanac, how the S&P 500 does in January tends to correlate with how the market does for the full year.

Since 1950, the barometer has been right 91 percent of the time, according to the Almanac, or 75 percent of the time when you factor out years that ended essentially flat.

As of Tuesday's close, the S&P 500 is up 0.7 percent in January of 2007. If it can hold those gains Wednesday, the last day of January, that could be a good sign, said Jeffrey Hirsch, editor of the Almanac.

"If January 2007 ends slightly higher, that suggests that despite all the concerns that we may have politically, economically and in terms of interest rates, the stats are telling us the year looks positive," Hirsch said.

But if it ends lower? Since 1950, every down January has led to a new or extended bear market, or a flat year.

The Almanac's theory has been tested in a different form by Sam Stovall, Standard & Poor's chief investment strategist, who tracks what he calls the January Barometer Portfolio.

According to his research, since 1970, a hypothetical portfolio of the 10 best-performing S&P industries in January has beaten the overall S&P 500 in the remaining 11 months of the year 75 percent of the time.

January is particularly likely to influence the full year in a year like 2007, according to those who think the stock market follows the four-year cycle of the presidency. That's because 2007 is considered a "pre-election year." In such years, stocks have followed January's lead in 13 of the last 14 times.

The lone recent exception was 2003, when stocks fell in Jan, bottomed out just ahead of the war in Iraq in March, and then bounced after uncertainty about the war was removed, rallying through year's end.

Fear not hemlines

Granted, quirky mkt indicators have to be taken with a grain of salt, as followers of Super Bowl indicator & hemline indicator can tell you.

But the reasoning behind the January barometer is comparably sound: A positive January can give the market a built-in cushion for the rest of the year, if gains are big enough. Beyond that, events in January tend to influence how investors look at the rest of the year. Congress meets, and the President gives the State of the Union Address and provides the administration's agenda for the rest of the year.

Additionally, investors tend to reshuffle their portfolios early in the year, putting money into play based on what they think will do well for the full year.

Will this year be different? After all, the current bull market is getting old by historical standards - it turned four last October. And analysts say the fact that it hasn't seen a significant correction is a concern.

Plus, you have an economy that's slowing, but perhaps not enough to suggest that the Federal Reserve will cut interest rates, as well as earnings that are slowing, which would contract P/E valuations. All of which could pressure stocks going forward.

On the other hand, the Federal Reserve seems to be on its way to engineering a so-called "soft landing," inflation seems to be moderating and earnings growth, though slower, remains steady for the time being, said Ram Kolluri, chief investment strategist at GlobalValue Partners.

All of which could support stocks, albeit modestly, through the rest of the year, regardless of how January ends.

One other statistic on the side of the stock market: the aforementioned fact that 2007 is a "pre-election year." The S&P 500 hasn't ended a pre-election year lower since 1939, the start of World War II.

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01-Feb-2007 00:25

Genting Sing / outlook

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So those who wish to buy say $1.03c and above or miss this px, then can oso buy at higher px if U must, as for those who bot liao will let go to (they) take profit, eg is those who bot high (a chance to let go liao) as for U, can U wait for the next round for px to be up again in case px turn out entering position at the wrong time, buy with ur mean if U must, mean while happy trading. Merill Lynch is still the best pricing so far stood at $0.95c from a buy to a hold, good for punting oni.

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01-Feb-2007 00:13

Genting Sing / outlook

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tink tink is less then GES weight factor (incidentally GES in delisted) i mean such a big co given so less weight. it can cheongg..1st co's of those BBs, say to $1.10-$1.20 range, but then ppl take profit if they bot at a lower px and those who bot at higher px w/o having to pay up, oso may let go in order not to get their $$$ get stuck, then px maybe down a little after that, just my tot.

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01-Feb-2007 00:03

Others / Good time for China stocks again?

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just one word, money, more money, one trillion ?? or more trillion..coming, so Olympic 2008 oso need more money, so how to say China stock is bubbling now, is those ppl finding execuses to take profit 1st, then end of the day, still more money into in bag, let c weather they make more or making less.... U tink tink those top ppl would want to rock the boat now or just trying to slow the boat a little.

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31-Jan-2007 20:59

User Research/Opinions / Sand Ban - In Perspective

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Ohh ready hope so, hopefully sand px is steady as it goes...co's vested in Jasper (A Coy investing in profitting construction firms and so on).

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31-Jan-2007 20:20

Others / SunVic IPO

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All clear signal for this ipo counter to go double liao it PE ratio is 3.7x base on yr 2005 business, this yr is 2007. PER nos may reverse to 7.3x it PE ratio. Just my tot.

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31-Jan-2007 20:13

S i2i / MediaRing

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What is those BBs like KBH doing, letting px drop meh?? Just wondering!!! or a good chance for then to collect some more when it is rite time to collec isit??.:) MR closed at 0.425c (-0.015c) on vol of 20,223 m share traded.

teeth53

Posted: 14-Jan-2007 17:34

 

Precisely that is what (ST) Singtel former Chairman KBH can do at best, but at current px and sell a stake to..... in other word it mean "Kuang Si" at worst sell a more convincing story, like Voip connect to many other countries. No bad feeling, hope not to offence those vested in this stock, wish them best of luck and blessing that BBs continues with this saga. Just my tot.

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31-Jan-2007 19:59

Others / New ipo-Ur choice (C.Farm,CttySpring, or KSH)??

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1) ChinaFarm eq 0.345cts closed Feb 9, 2007

2) CitySpring 0.77-89c closed Feb 12, 2007 and

3) KSH Holding 0.36cts closed Feb 8, 2007

Personnally, i prefer Chinafarm EQ ipo co's of it low PE ratio of 3.7x

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31-Jan-2007 19:48

Others / SunVic IPO

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SunVic, Sun victory, very strong Sun shining this few days, stronger them Unionmet ipo, look likely this is d way to make more kopi $$$.

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31-Jan-2007 19:41

Chinese Global / HitChins hit bull eye what's brewing$$$???

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Top 23c, down to 195c and closed at 20c (-0.015c) on a volume of 2,552 lot traded. C if U like to punt is Okkk.....

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31-Jan-2007 19:37

Others / Unionmet IPO

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Magical nos 37c, changed to 73c and top up with 2c more to closed at 75c with a healty vol of more then 200m shares traded. tomorro mat c 78c, 78c coming...80c coming....B4 it decide where it want to go.....:)

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31-Jan-2007 19:28

Straits Times Index / STI to cross 3000 boosted by long-term investors

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Today mkt is in muddy moody mode, more red then green. with a healthy volume of 2,179.2m shares traded. ST Index closd at 3,25.56 pt, -4.7 pt, for the 3rd day, Friday may not be so positive. Just my tot.

teeth53	Posted: 30-Jan-2007 20:48
	Mkt look more red then green. ST Index range bound today, for d 2nd day liao. Closed at 3,130 +1.3pt, Fri may not be so positive, expecting some positive response following coming Monday, jus my tot.

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31-Jan-2007 00:28

M 1 / Gallen help me!

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Philip TP px coming.....M1 down sizing, it $$$ oso seem down sizing.. unless it comeup with more innovative products, seem losing it shine to *hub and Singtel. Just my tot.

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31-Jan-2007 00:26

Chinese Global / HitChins hit bull eye what's brewing$$$???

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This wk, take no action unless one wanted to punt or called it day trading. Next week even harder to tell pending Friday trading px and it volume, seem down trenching, but those BBs will push it up, just my tot.

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30-Jan-2007 20:54

Chinese Global / HitChins hit bull eye what's brewing$$$???

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Alas, this counter is down to $0.185c B4 coming back to closed at $0.215c with a vol of 5.24m shares changed hand, it is oso due to down turn mkt in line with the general mkt taking profit today and maybe oso for the rest of this week. To those who bot at 185c should has collected some profit liao, just my tot.

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30-Jan-2007 20:48

Straits Times Index / STI to cross 3000 boosted by long-term investors

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Mkt look more red then green. ST Index range bound today, for d 2nd day liao. Closed at 3,130 +1.3pt, Fri may not be so positive, expecting some positive response following coming Monday, jus my tot.

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