8/31/11…another day, another rally

Bloomberg Top Stories:


*Stocks Rally a Fourth Day as U.S. Futures Jump on Fed Outlook(?); Bonds Fall

*Fed Prepared Ground for Possible Easing as Officials Considered Stimulus

*U.S. Companies Add Fewer-Than-Estimated 91,000 Workers in August, ADP Says

*Canada’s Economy Contracts For First Time Since 2009 on Decline in Exports

*High-Yield Loan Sales Collapse as Losses Deepen to 6.14%

*AT&T Pledges to Add 5,000 Call Center jobs for T-Mobile Takeover Approval

*Containers Slump to 50-Year Low ass Ships From China Slow – not a good sign!

*Best-Paid CEO’s in U.S. Earned More Thatn Companies’ Tax Bills, Study Finds!

*Rebels Forage for Munitions Ahead of Final Assault on Qaddafi Birthplace

*Merkel Cabinet Approves Wider Euro Rescue Fund as Opposition to Plan Fades

*Pentagon Prepares to Suffer as Decade Long Spending Spree Fades

*Algeria May Regret ‘Act of Aggression’ Offering Refuge to Qadaffi’s Family


Volume rose to 4.0 billon shares from 3.6B shares on the NYSE, lowest in nearly two months. Meanwhile shares executed on the Big Board rose to just 1.0B from 912 million, lowest since July 26th…that was the day before stocks fell off a cliff and put us where we now sit! Note also that we had a ‘double top’ in July with the first coming on 7/7 and the second on 7/24, which could prove ominous. We now have a TRIPLE TOP of the bounce from the 8/9 lows which were lowest since 9/17/10! BAC was 1/3 of total NYSE volume for a fourth straight session and fell 3.2%. Advance/Declines were positive but barely: +1.8x vs +1.5:1 vs +5:1 vs -3.3:1 vs +2.3:1 vs +5.5:1 vs -1.2:1 on NYSE and +1.1x vs +7:1 vs +4:1 vs -4:1 vs +2:1 vs +4.8:1 vs -1.2:1 on Nasdaq while Breadth was boring: +1.3x vs +31x!!! vs +9.5x vs -3.1x vs +3.4x vs +4.4x vs -1.2x on NYSE and +1.2x vs +39.5x!!! vs +8x vs -9x vs +2.6x vs +6.2x vs -1.3x on Nasdaq. New 52 week highs rose again, but remain low, to 72 from 62, while new lows slid further to 33 from 43 from 228!!! – the high was 616 last Friday! The ratio has been positive now for two sessions for the first time in weeks. The VIX after plunging for three sessions, rose slightly to 32.89 +.61. 48 was the selloff high, not seen since 5/21/10: 48.20!


Overnight global equities are rallying: FTSE +1.02% vs +1.8% vs closed vs -1.1% vs -0.4% vs +0.8% vs +0.5% vs +2.3% vs -1.5% vs -2.7%; CAC 40 +2.2% vs -0.3% vs +1.6% vs -1.7% vs +0.3% vs +1.3% vs +1% vs +2.3% vs -1.6% vs -3%; DAX +1.9% vs -1% vs +1.2% vs -2.2% vs -0.1% vs +2.4% vs +07% vs +1.3% vs -2.7% vs -3.8%!!!; Nikkei flat vs +1.2% vs +0.6% vs +0.3% vs +1.5% vs -1.1% vs +1.2% vs -1% vs -2.5% vs -1.3%; Hang Seng +1.6% vs +1.7% vs +1.4% vs -0.9% vs +1.5% vs -2.1% vs +2% vs +0.5% vs -3.1% vs -1.3%; Korean KOSPI +2% vs +0.8% vs +2.8%!!! vs +0.8% vs +0.6% vs -1.2% vs +3.9% vs -2% vs -6.2%!!! vs -1.7%; Indian Sensex +1.6% vs +1.6% vs +3.6%!!! vs -1.8% vs -0.9% vs -1.3% vs +1% vs +1.2% vs -2% vs -2.2%. U.S. futures rallying sharply, ignoring weak ADP report: DOW +109; SPX +13.40; NDQ +20.50. Gold holding on to Tuesday’s gains and up for a second session after plunging Gold has nearly offset the huge four day decline from the big record high of $1917.90 set last Monday and is now $1,832.20 +$2.30! As for Crude, it is giving up some of Tuesday’s gain. $88.28 -.64. First resistance is at $90, then $92-95. Meanwhile, bonds were trashed but have regained the losses and more and now are above Friday’s close! 30 yr 3.50% +1/2; 10 yr 2.14% +5/16.


…of sorts. Transports were the only ones that were impressive though +1.4% but today we have a story that shipping containers are sitting idle…what does that say? Also, volume was higher but still very low. Still the market opened in the hole and headed north. Interesting that no one with an understanding of the Fed got excited over the release of the minutes of the last FOMC but the market rallied…go figure! Gold rallied and talk is of $1900 again before long. One thing of note is that the gold miners are finally rising more than gold…that is more long term money where the gold etf is highly speculative…like the front crude contract.


Nothing of importance until payrolls Friday and they will likely disappoint. Also another hurricane is building.


. . .  – – –  . . .    . . .  – – –  . . .


If you like televangelist wannabe, Rick Perry, be sure you learn all you can about him before you vote. Yesterday he said that under no circumstances would there be any stimulus if he is elected president…don’t you like flexibility in a president?

He also says that there are some flaws in Darwinism, that global warming is a myth made up by scientists to get more funding for their projects. All this from a man who has never worked in the private sector…you decide.

Have a good one!



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