7/29/13…the gospel according to Maria B.

From The Friars Club Encyclopedia of Jokes: “Poor Hackley – half his friends deserted him the day he lost his money. The rest left as soon as they found out.” – unattributed.

Bloomberg Quotes of the Day: “The science of today is the technology of tomorrow.” – Edward Teller…and the science fiction of today is the science of tomorrow. TB

This week’s economic calendar is packed with important indicators. The highlight of the week will be the GDP – Q2 advance (Wednesday), July ISM Manufacturing Survey (Thursday) and July Employment Situation (Friday). We will also get July Dallas Fed Manufacturing Survey (Monday), May Case-Shiller Home Price and July Consumer Confidence (Tuesday), July ADP Employment, Q2 Employment Cost Index, and Chicago PMI (Wednesday), June Construction Spending and July Motor Vehicle Sales (Thursday), June Personal Income and June Factory Orders (Friday). In addition, the Federal Reserve FOMC will be meeting on the August 30th – August 31st with an announcement on the 31st . Courtesy of Economic Advisory Service

Bloomberg Top Stories:

*Barclays Slips as Bank Discusses Funding With U.K.’s Financial Regulator

*Yen Strengthens as U.S. Index Futures Decline While Stocks in Europe Rise

*Hudson’s Bay Agrees to Buy Saks for $2.9 Billion Including Assumed Debt – !?!

*Euro bond Yields Diverge from U.S. If all Goes According to ECB-BOE {;ams

*Junk Fever Builds With Record Flows as High-Grade Trails – go figure!!!

*Mideast Talks Set to Restart Today After Israel Backs Release of Prisoners

*Muslim Brotherhood Defies Egypt’s Military with Call for Further Rallies

*Pope Reaches Out to Gays, Says He Won’t Judge Priests’ Sexual Orientation – nice but what the hell does that say? Condoning? Rethink!

*Boeing Urges Emergency Beacon Inspections on Some Planes Other Than 787s

    

On Friday, TB asked: when will the insanity end? Will we ever be back to ‘normal’ markets? Not until the Summer doldrums end…at least! Recapping: Friday was a MIXED day…with best performer Dow Utilities (?), followed by Dow Transports AND a strange NDQ 100…both +0.5% While the Nasdaq Composite rose just 0.2%, the S&P 500 +0.1%, the Dow 30 FLAT, Russell 2000 DOWN 0.6% and NYSE Financials down 0.3%…if you can make sense of that you are better than TB. Thursday was another boring day with the Dow rising just 0.1%, Transports DOWN 0.1% following a 1% loss, S&P 500 +0.3%, both Nasdaq indices up 0.7% and the Russell 2000 the winner with a 1% gain. Dow Utilities rose 0.4% as did NYSE Financials…Wednesday was a down day: stocks down, bonds down, gold down, crude down…get the picture? It made no sense.

Now let’s look inside NDQ 100 for more confusion…is there a trend in there? Doubtful.– compare to the leaders of the prior four sessions: the 100 rose 14.6 points vs +20 vs +10 points vs -24 vs +10 vs -33 with 1.5:1 declining vs 2:1 advancing vs 7:3 declining vs 3:1 declining vs 2:1 advancing  Leaders rotated again: the entire gain was in 8 stocks: SBUX +3.1 vs +1; AMZN +3.1 vs +1.8; GILD +2.2 vs +1.3 vs +1; AAPL +1.9 vs -1.8 vs +18 vs -6.1 vs +1.1 vs -5.6; QCOM +1.9; MSFT +1.1 vs -4.2 vs +1 vs -1.4 vs +4.6 vs -30!!! vs -3.2; CELG +1.1 vs +1.7. Losers were: ECXPE -1.9; VRTX -1.4; BIIB -1 GOOG -3.7; AAPL -1.8 vs +18!!! vs -6.1! vs +1.1 vs -5.6; BRCM -2.2; CMCSA -1.5. Direction???

The VIX oscillated again in a range of 12.80-13.73, finally settling in at 12.72  -.25…no man’s land…Monday’s 11.99 low was lowest since 5/17 – is the euphoria over? The market is very vulnerable to earnings reports which are coming in mixed. We remain in the summer doldrums…and that is not good for trend followers. A/D’s and Breadth were both negative. Both new 52 week highs and lows plunged!

…here’s the book:

* Dow 30 +0.5% vs +0.1% vs -0.1% vs +0.3% vs -0.1%; Dow Transports +0.5% vs -0.1% vs -1% vs -0.8% vs flat vs +0.1%; Russell 2000 -0.6% vs +1% vs -0.1% vs flat vs +0.3%; Dow Utilities +0.6%! vs +0.4% vs +0.2% vs +0.3% vs +0.2%; S&P 500 +0.1% vs +0.3% vs -0.2% vs flat vs +0.2 %; Nasdaq Composite +0.2% vs +0.7% vs -0.6% vs -0.4% vs +0.4%; NDQ 100 +0.5%! vs +0.7% vs -0.8% vs -0.5% vs +0.3%.

*NYSE Volume plunged again to a very weak 2.74B shares vs 3.31B vs 3.07B vs 2.42B (3rd weakest of 2013), vs 2.77B (1.96B is the lowest of 2013). REAL NYSE Volume also plunged to barely rose to a very weak 596M shares vs 677M vs 670M vs 608M vs 584M (562M is lowest since 7/3). The 12-month average is 718M shares and declining! The average since 6/30 is just 673M shares, ranging from 482M to 906M, 482M being the 2013 low! There have been just SEVEN 1B+ share sessions! There have been 28 800M+ shares in 2013: 10 up, 17 down, and one mixed, but on trades of less than that 91 have been up and 33 down …there have now been 29 mixed sessions.

*New 52 week highs have ranged from 33-864. They too plunged to 262 vs 410 vs 569 vs 545 vs 630. New lows were halved to 87 vs 180 vs 60 vs 45 vs 103 vs 37 vs 27 –new low.  

  1. Advance/Declines were negative: -1.1x vs +1.3x vs +1.3x vs +1.5x vs +1.3x (recent range -17.5x to +4.4x) on NYSE and -1.6x vs +2x vs -1.2x vs -1.1x vs +1.5x (recent -3.5x to +3x). Breadth was also negative: -1.1x vs +1.5x vs +1.4x vs +1.6x vs +1.8x (recent -18.6x!!! to +6.9x!!!) on NYSE and -1.4x vs +2.6x vs -1.7x vs -1.3x vs +1.8x (recent -12.8x to +6.2x)  
  2. NYSE Financials slipped by 0.3% vs +0.4% vs -0.1% vs flat vs +0.7% vs +0.1%. BofA was most active again slipping  to $14.73 -.10 three days after hitting $15.03, highest since Jan. 14 and now major res: -0.7% vs +0.8% vs -1.6%! vs -0.1% vs +1.2%. Brokers -0.8% vs +0.7% after being flat for THREE days; KBW Banks -0.7% vs -0.2% vs flat vs +0.1% vs +1%; Nasdaq Banks -0.5% vs -0.3% vs +0.3% vs +0.3% vs +0.9%.  
  3. Volatility (S&P VIX) surprisingly slipped to 12.72 -.25 but with a range of 12.80-13.73.  On 7/23 it declined to 12.07, lowest since April 12th with a high of 13.06! VIX peaked at 20.49, plunged to 18.90 on June options expiry then closed at 20.11 on 6/24 and has been down since – a decline of 33%! 6/24’s session high of 21.91 was highest since 12/31/12 (22.72)!!! The range since April ‘12 is 11.05 (multi- year low o n 3/14/13) to 21.9. It is well below the 40/50 day (15.77/15.33) and the 200 day (14.97)!!!…ytd the range is 11.05 (3/14) to 21.92 (6/24)!

European stocks stocks mixed, Asia weaker led again by Japan!!! UK +0.3% vs -0.3% vs -0.8% vs +0.9% vs +0.3%; France +0.3% vs +0.4% vs -0.8% vs +1.3% vs +0.3%; Germany +0.3% vs +0.5% vs -0.9% vs +1.2% vs +0.3%; Japan DOWN 3.3%!!! vs -3%!!! vs -1.1%! vs -0.3% vs +0.8%; Hang Seng -0.5% vs +0.3% vs -0.3% vs +0.2% vs +2.33%!!!; Korea -0.6% vs +0.1% vs -0.1% vs +0.4% vs +1.3%!; India -0.8% vs -0.3% vs -1.4% vs -1% vs +0.7%. U.S. equity futures lower and back in a tight  trading range…look at last three sessions: DOW -25 vs -57 vs -61; SPX -3.20 vs -6.50 vs -7.30; NDQ -5.50 vs -4.75 vs -2

Bonds closed little changed  and are slightly higher overnight: 10 yr Treasury 2.55% +3/32 (recent range 2.74% to 1.63%!!!), and the 30 yr range of 2.82% to 3.71%, currently 3.61% +1/8. The long TIP is 1.34% +3/16. The (record?) low of 0.36% was set on 4/5. Recent high 1.53%! Libor update: 0.266% 3 mos, 0.396% 6 mos. Both remain near the Jan. 2010 record lows (0.245% and 0.382% respectively). Foreign bond yields mixed and little changed: Germany 1.67% +1; UK 2.31% -2; France 2.26% -1, Italy 4.41% +2; Spain 4.61% +1; Portugal 6.29% -1; Greece 9.81% +1 vs 9.81% -10 vs 9.91% vs 10.02% +19 vs 9.81% vs 9.95% +17 vs 9.86% vs -13 vs 9.93% vs 10.07% vs 10.02% -16!!! vs 10.27% -19!!! vs 10.33% -25!!! vs 10.69% vs 10.85% +28!!! vs 10.52% vs 10.54% +40!!! vs 10.85% -37!!! vs 11.22%. Recent range: 8.04% to 12.57%.  Japan 0.79% +1.

Gold closed higher again and remains well above the critical $1300 closing at $1334.00 +$4.50. Tuesday’s session high was $1349.20 – highest since 6/20! 6/27’s intraday low was $1179.40 – lowest since at least 2011 and now critical support. $1300 remains psychological support, while the close puts it above the 40 day $1316 and the 50 day $1330 – both still falling. lt is way below, the 200 day – $1559!!! Overnight it is STRONG at $1336.20 +$14.30!!! Crude closed lower at $104.61 -.88 – with a session low of $103.90!!! The rally that began on 7/12 has been neutralized. It remains well above the 40/50 day m/a’s (99.97/98.94). The 200 day ($93.45) is distant support. First support is $104.21-36 – a triple bottom from 7/10-7/12. 4/18’s low of $85.61 was lowest since 12/11! It is little changed at $104.77 +.07. The range is $85.61-$109.32 since March 1, 2012.

Some random thoughts:

Running a bit late but Congress is finally waking up…or putting on airs to about our corrupt financial system…this, which was once the best in the world…it still may be but what does it say? Yesterday on This Week, Maria Bartaromo said that Spitzer is bad because he wants to destroy Wall Street. Shut up! Maria…are you blind or paid to act it?

Have a great week!

TB

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