5/22/13…awaiting the Fed

From the Friar’s Club Encyclopedia of Jokes: “As far as the men who are running for president are concerned, they aren’t even people I would date.” – Nora Ephron

Bloomberg Quote of the Day: “Never underestimate the power of human stupidity.” – Robert A. Heinlein – so true, so true!

Bloomberg Top Stories:

*Fed’s Dudley Says Decision on Tapering QE Will Take Three to Four Months

*S&P 500 Futures Gain With Gold Before Bernanke Remarks; Yen Weakens

*Google to Join Apple in Avoiding Tax Through Units’ Stateless Income

*Wells Fargo Names Equity Sales, Trading Heads to Expand in Market Rebound

*Covenant Bubble Seen Forming by Moody’s as Shields Vanish

*Caisse Joins HSBC Dumping Bonds as Pension Returns Dwindle

*Subprime Mess Left by Pritzker Is Seen as Opening for Republican Opponents

*Senate Committee Approves Immigration Bill Enabling U.S. Visas for Skilled

*Oklahoma Schools Where Children Died Didn’t Have ‘Safe Rooms’ for Shelter

*Costa Concordia’s Captain Indicted for Manslaughter After Italy Shipwreck

*Shulman’s Above-Fray Posture to Get Test from Oversight Panel in IRS Probe  

A modest up day that didn’t quite offset Monday’s modest declines…little happened. Oh, yeah, more record highs and high closes…barely! Advance/Declines and Breadth were both minisculely positive and unconvincing. Volume climbed back to an above average 3.49B shares vs 3.27B vs 3.44B, while ‘real’ trades on the floor of the NYSE were stable at a weak 685M shares vs 683M from 848M, highest since April 30th.  Trading continues to be professional – will there be a ‘safety net’? You decide.

So let’s see what else happened:

*Dow Transports +0.1% vs -0.1% vs +1.3% vs -0.8% vs +0.8% vs +1.9%; Russell 2000 +0.1% vs +0.2% vs +1.1% vs -0.3% vs +0.3% vs +1.3%; Dow Utilities +0.2% vs -0.6% vs +0.9% vs -0.9% vs +0.7% vs +0.5%; S&P 500 +0.2% vs -0.4% vs +1% vs -0.5% vs +0.5% vs +1%; Nasdaq Composite +0.2% vs -0.1% vs +1% vs -0.2% vs +0.3% vs +0.9%, NDQ 100 +0.2% vs -0.1% vs +1% vs -0.3% vs +0.2% vs +0.5%, Dow 30 +0.3% vs -0.1% vs +0.8% vs -0.3% vs +0.4% vs +0.8%.

*NYSE Volume rebounded to an average 3.49B shares vs 3.27B vs 3.44B vs 3.47B vs 3.66B vs 3.43B vs 2.86B (low for the year). REAL NYSE Volume however was FLAT at a weak 685M shares vs 683M vs 848M, highest since 4/30, vs 679M vs 738M vs 700M vs 594M (lowest since 4/8). Recent highs were 975M (selloff) to 887M (rally). The average last week was a weak 726M shares vs 720M vs 687M vs 859M vs 689M!!! The 12-month average is just 723M shares. The range since 2/11 is 558M to 1.825B on 3/15’s options expiry and a near 12 month high, second only to 12/21’s 1.88B shares. Note that 3/15’s (options expiry) was the only day since 2/28 to register over 1B shares! There have been just sixteen 800M+ shares in 2013 – just 5 up, 11 down, but on trades of less than that 76 have been up and just 23 down…there have been 20 mixed sessions.

*new 52 week highs have now ranged from 100-864. They fell yesterday to 649 vs 811 vs 726 vs 640 vs 864 vs 793. New lows were halved to 31 vs 63 vs 67 vs 95 vs 66 vs 38 vs 39 (recent range 29-237).

  1. Advance/Declines were barely positive: +1.2x vs +1.3x vs +2.6x vs -1.5x vs +1.2x vs +2.1x vs -1.5x (recent range -7.1x to +4.4x) on NYSE and +1.1x vs +1.2x vs +2.2x vs -1.3x vs +1.3x vs +2.3x vs -1.2x (recent -3.5x to +3x). Breadth was similar but better on Nasdaq: +1.1x vs +1.6x vs +4x! vs -2.3x vs +2x vs +3.3x vs -1.4x (recent -10.5x to +6.4x!!!) on NYSE and +1.6x vs +1.2x vs +2.9x! vs -1.1x vs +1.8x vs +2.4x (recent -12.8x to +6.2x)  
  2. NYSE Financials were FLAT vs +0.1% vs +1.3% vs -0.8% vs +0.7% vs +0.9%. BofA declined by 0.4% vs +0.6% to $13.46 -.05, 8th day above $13 since 4/11/11!
  3. Volatility (S&P VIX) rose slightly for a second day following declines in four straight sessions to 13.35 +.+33 (only 3rd day above 13 since May 2). The range since 4/12 11.99 (multi year low) to 18.20, and it is below the 40/50 day (13.37/13.61) and the 200 day (15.05)…ytd the range is 19.28 (2/25!) to 11.05 (3/14) – 12 mo. ave 16.10!

Global equities mostly weaker: UK +0.2% vs +0.2% vs -0.1% vs +0.4% vs -0.1%; France -0.3% vs -0.1% vs -0.2% vs +0.4% vs +0.4%; Germany -0.1% vs -0.2% vs +0.2% vs +0.3% vs -0.1% vs -0.1%; Japan +1.6%! vs +0.1% vs +1.5% vs +0.7% vs -0.4% vs +2.3%; Hang Seng -0.5% vs -0.5% vs +1.8% vs closed vs +0.2%; Korea +0.6% vs -0.1% vs -0.2% vs closed vs +0.8%; India -0.3% vs -0.6% vs -0.3% vs +0.2% vs +0.2% vs +2.5%!!!. U.S. stock futures were higher in yet another very narrow trading range session. Market is opening higher: DOW +41; SPX  +4.71; NDQ +9.87.

Bonds were slightly better yesterday and again overnight ahead of the policy statement following the FOMC meeting…still VERY weak: 10 yr Treasury 1.92% +3/32 (recent range 2.06% to 1.63%!!!), and the 30 yr’s 3.26% to 2.82%!!!, now 3.12% +3/16. The long TIP is 0.72% -1/8 – still the weakest link since setting a new (record?) low of 0.36% on 4/5. Recent high yield is 0.76% set on 5/20! Libor update: 0.274% 3 mos., 0.418% 6 mos. Foreign bond yields mixed. Germany 1.40% -4; UK 1.86% -4; France 1.87% -2, Italy 3.92% +1; Spain 4.18% +2; Portugal 5.17% +1; Greece 7.98% -3 vs 7.97% vs 7.94% vs 7.96% vs 8.47% vs 8.52% vs 9.12% vs 9.44% vs 9.43% (recent range now 7.94%-12.57%). Japan 0.88% +1.  

Gold closed lower and has been down 7 of the last 8 sessions following Monday’s intraday low of $1336.30, lowest since 4/18, at $1377.60 -$6.50. 5/10’s high of $1487.20 was highest since 4/12. 4/16’s intraday low of $1321.50 – was lowest since Sept. ’10. Resistance remains way above at the 40 day/50 day: $1473-1499. Overnight it is higher at $1388.00 +$10.40. Crude closed lower at $96.16 -.55 on an ‘inside’ session, 10 days after posting a new rally high of $97.17, nearing a 12 month high! It is well above Sup/Res at the 40 day ($93.62), 50 day ($93.52) and 200 day ($92.29). Overnight however, it is $94.96 -$1.21.  4/18’s low of $85.61 was lowest since 12/11! The range is $85.61-$97.80 since June 29, 2012!!!!

 

Some random thoughts:

They could fill volumes…still trying to work them out..

TB

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