“The best traders have no ego. You have to swallow your pride and get out of the losses.” – Tom Baldwin

1. China’s 2014 Economic Growth Expanded 7.4% in 2014, Hits 24-Year Low — Reuters, China’s economy grew at its slowest pace in 24 years in 2014 as property prices cooled and companies and local governments struggled under heavy debt burdens, keeping pressure on Beijing to take aggressive steps to avoid a sharper downturn. Growth in the world’s second biggest economy has not fallen below 7.6% since 1990, when it grew 3.8% as a result of international sanctions in the wake of the Tiananmen Square massacre.
2. IBM Gives Disappointing Forecast — IBM (IBM) revenue fell 12% in Q4 and it’s the 11th consecutive quarter IBM has failed to report a revenue increase, while net income sunk 11%. The drop costs the “Oracle of Omaha” (Buffett) some $397 million, based on his 70,478,012 shares as of September 30, 2014.
3. ECB Board Proposes Roughly €50 Billion in Bond Buys Each Month — MarketWatch, the European Central Bank (ECB) Executive Board has proposed quantitative easing of 50 billion euros ($58 billion) a month until the end of 2016. The proposal to inject as much as 1.1 trillion euros reflects President Mario Draghi’s determination to expand the ECB’s balance sheet to stave off the threat of deflation and put the 19-nation economy back on the path to health.
4. AmEx (AXP) to Cut More Than 4,000 Jobs This Year After Unit Sale — American Express (NYSE:AXP) announced plans to cut more than 4,000 jobs this year as part of a restructuring, while taking a $313M charge this quarter “to improve operating efficiencies.” The credit-card issuer’s fourth quarter net income came in at $1.447B or $1.39 per share vs. $1.308B and $1.21 one year ago. Warren Buffett’s portfolio owns 151,610,700 shares as of Sept 30, 2014.
5. Saudi King’s Death Spurs Policy Speculation About Oil — Bloomberg, Saudi royal court announced the death of King Abdullah, who died at about the age of 91. A key indicator of future Saudi oil policy will now be whether Salman, who will replace King Abdullah, retains oil minister Ali Al-Naimi since 1995.
6. Bullish Sentiment Decreased in the Latest Survey — courtesy of BIG, cccording to the weekly survey from the American Association of Individual Investors (AAII), bullish sentiment dropped from 46.11% down to 37.1%. That 9 percentage point drop took bullish sentiment down to its lowest level since 10/2 and back below the bull market average of 38.8%.

The week ahead — Economic data from Econoday.com:

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