From the Friars Club Encyclopedia of Jokes: “College is the best time of your life. When else are your parents going to spend thousands of dollars a year just for you to go to a strange town and get drunk every night?” – David Wood
Bloomberg Quote of the Day: “With the new day comes new strength and new thoughts.” – Eleanor Roosevelt
Bloomberg Top Stories:
*U.S. Productivity Fell 1.9% in Q4 as Labor Costs Rose 0.4% (Prod: 2012 +0.7% vs +0.6% in 2011…Labor Costs: 2012 +0.7% vs +2%! in 2011 – What about the sharp drop in earnings – and savings – reported last week? Houston…we have a problem!)
*Dollar Breaks Four-Year Correlation Streak With Stocks in Sign Bulls Love
*Draghi Keeps Rates on Hold as Italian Election Erodes Confidence in Upturn
*Draghi Says Recent Data Suggest Stabilizing Economic Growth – but downside risks!
*Stocks in Europe Pare Gains After Braghi Keeps ECB Interest Rates on Hold
*Banks Said to Consider Disregarding Fed by Disclosing Dividend Plans Early
*Dell LBO Proposal Gets Messy as Icahn Joins Investors Seeking Better Deal
*Apple Seen Failing to Meet Second-Quarter Sales Forecast
*Colgate Announces 2-for-1 Stock Split, Increases Quarterly Dividend by 10%
*Climate Change Inevitable to Investors Seeking Profits From Hotter Planet!
The bobbleheads at CNBC continue to crow about the Dow as it eked out another new record high and high close…but fading (?) just 38 to the high vs 88 and 42 vs 56 points for the high close. Did anyone adjust that for inflation? …or for a reasonable return? Also, as pointed out in a prior column it isn’t even the same Dow!!! No more AIG, Citi, or others. If it drops today ‘mum’s the word’ as always. What a ship of fools at our sterling financial station! Oh, and volume has been little changed for the last four sessions while REAL trades on the NYSE have been less than 700M for three sessions? The fool’s folly continues yet reigns supreme!
More ‘tepid’ volume, with the biggest gainers the Dow and Russell 2000 (plus NYSE Financials) all +0.3% while the stellar Dow Transports fell 0.4% after being the big winner at +1.5% vs +1%. The two Nasdaq indices fell by 0.1% and 0.2% respectively while the S&P 500 rose just 0.1%. Dow Utilities were flat vs +0.5% vs +0.9%!
The high on the Dow was a new record 14320 with a new high close of 14296. This is looking more like yet another year of ‘sell in May and go away’ – IF we make it that far…and if the extremists in the GOP have their way it will be even earlier!
Total NYSE total volume rose slightly to a modest 3.67B shares vs 3.57B vs 3.38B following an ‘average’ 3.76B shares vs 3.53B vs 3.92B vs 3.81B vs vs 3.41B vs 4.26B and 4.2B (highest of 2013 by about 400M shares). Real NYSE volume was steady at a weak 684M shares vs 683M vs 693M vs 743M vs last Thursday’s (monthend) 1.01B shares!!!(second only to 1/18’s 1.07B and third best to 12/21’s 12 mo. high of 1.88B shares) vs 673M vs 772M vs 819M vs 683M. Note this entire week has been <700M shares while the average volume since 2/15 is a weak 781M shares!!! Ave vol. 12 mos. 745M, ytd 714M. There have been just eight 800+M shares in 2013. This is a very weak rally that is producing record highs on the Dow???
- new highs which have ranged from 121-680 (2/19), before falling to just 121, nearly slipped to 539 from a very high 709 vs 418 vs 274 vs 326 vs 268 vs 145 vs 273 vs 214. New lows slipped to 64 vs 73 vs 98 vs 93 vs 59 vs 49 vs 74 vs 52.
- Advance/Declines were barely positive at +1.3x vs +2.8x vs +1.3x vs +1.3x vs +1.1x vs +3.2x vs +2x vs -3.6x on NYSE and +1.2x vs +2.4x vs +1.2x vs +1.3x vs -1.1x vs +2x vs +1.5x vs -4.4x on Nasdaq. Breadth was similar at +2.2x vs +4.1x vs +1.5x vs +1.2x vs -1.1x vs +6.2x +2.4x vs -9.7x on NYSE and +1.4x vs +3.4x vs +1.8x vs +1.7x vs -1.1x vs +4.4x vs +1.6x vs -4.5x on Nasdaq.
- The Nasdaq 100 fell by 0.3% or 6.7 points. Apple was back to being the goat losing 4.5 index points vs a 9 point gain! On Monday it was also the big loser dragging it down by 8.5 points. The Russell 2000 small cap continued its climb with a 0.3% gain vs +1.2% vs +0.2% – that is up 2.2% in FIVE sessions!.
- NYSE Financials rose just 0.3% vs +0.9% vs +0.5% vs +0.1% vs -0.2% vs +1.4% vs +0.6% vs -2.5%. BofA still most active rose 3.2%! vs +1.2% vs +0.6% to $11.92 vs +0.1% vs +1.7% vs +0.9% vs -1.6%, coming back from $11.11, lowest since 12/17, well below the 40/50 day m/a’s for the lowest close this year – from $12.42 high on 2/13. Note that due to the low price 11 cents is a 1% change!!! MGIC rose another 5.1% following +27.8% and +10.3%, +43% in THREE days!
- Lastly volatility (S&P VIX) which had back to back lows going back to 2006 – huge complacency, had risen 52% in four days: 12.13 – 18.99 (with an intraday high Monday of 19.11, highest since 12/31 – highs on 12/30-31 were 22.72 and 22.19 respectively, highest since 6/15. It barely moved rising just 0.4% to 13.53 +0.5 and well below the 50 day m/a (14.68). Far too complacent for the reality!
European equity markets higher, Asia mixed…still on Dow record high??? UK +0.4% vs +0.4% vs +1.1% vs -0.4% vs -0.7%; France +0.6% vs +0.3% vs +1.6% vs +0.2% vs -1.5%; Germany +0.3% vs +1.1% vs +1.9% vs -0.4% vs -1.2%; Japan +0.3% vs +2.1%!!! vs +0.3% vs +0.4% vs +0.4% vs +2.7%!!! vs -1.3% vs -2.3% vs +2.4%, Hang Seng flat vs +1% vs +0.1% vs -1.5% vs -0.6% vs +2%; Kospi DOWN 0.8%! vs +0.2% vs +0.2% vs -0.7% vs closed; India UP 0.8%! vs +0.6% vs +1.4% vs -0.2% vs +0.3% vs +1.5%. U.S. stock futures higher, again trading in a narrow range, and near session highs – third day: DOW +33; SPX +4.10; NDQ +8.25. Payrolls Friday – caution!
Bonds whacked again and also accelerating overnight: 10 yr Treasury range of from 2.06% to 1.85% last 12 sessions, now 1.97% -5/16 and the 30 yr’s 3.23% to 3.05%, now 3.18% -9/16. The long Tip also very weak at 0.60% vs 0.56% – back at the high!. Libor update: 0.240% 3 mos., 0.449% 6 mos steady declines!!! Foreign bond yields higher in Germany and U.K. while problem countries decline: Germany 1.49% +4; UK 2.03% +7!; Italy 4.59% -6; Spain 4.85% -13!!!; Portugal 5.82% -20; Greece 10.62% -3 – these are unheard of daily changes…consistently!!!
Gold closed FLAT (?) still near support with the loss from the 1/17 high of $1699.90 at $117! It closed at $1574.90 unched, still down -$73 in 8 sessions but still above a week ago Thursday’s low of $1554.30 – not seen since May 2012! Overnight it is $1581.50 +$6.60. The total breakdown through the 40/50/200 day m/a’s, has major resistance $1643-1668, with first resistance at $1600, a double bottom from 8/14-15, also a psychological level. Last time it was below $1500 was Sept. 2011!!! Crude declined slightly yesterday on an ‘outside’ day, two days after setting another new low of $89.33, lowest since 12/26, and way below the 40 day ($94.81), AND $94.13, the 50 day. It closed at $90.43 -.39 after trading below the 200 day (90.36). Overnight it is $91.14 +.71 with a session low of 90.22 – below the 200 day 90.37!
Some random thoughts:
TB will restrict today to two columns sent to him by a friend…you decide.
If you liked Dick Cheney you might have new thoughts about this neo-con!