5/31/13…a little late for ‘sell in May’, don’t you think? But…

From the Friar’s Club Encyclopedia of Jokes: “A friend of mine willed her body to science, but science is contesting the will.” – Joey Adams

Bloomberg Quote of the Day: “All change is not growth, as all movement is not forward.” – Ellen Glasglow

Bloomberg Top Stories:

*Consumer Spending in U.S. Unepectedly Falls as Americans Incomes Stagnate – DUH!

*Stock futures in U.S. Decline as Investors Await Consumer Confidence Data

*Morgan Stanley Shrinking Correlation Unit Added $50 Billion in Derivatives

*New York Pension Chief Seeking Out $500,000 Managers to Cut Out Wall Street – !!!

*Canada’s Economy Grows at Fastest Pace Since 2011 on Surge in Oil Exports

*AIG Hasn’t Received Chinese Group’s Deposit for Sale of Plane Leasing Unit

*U.S. Plains States Face Another Day of Severe Storms From Volatile Weather

*Six-Foot-Eight Prosecutor Who Stared Down Bush Wiretaps Is Obama FBI Pick

 

Poor bonds…stocks started out lower then rallied…to hell with weak economic data…then rallied before closing modestly above prior days. With Industrials and Transports the weakest link and S&P 500 +0.4% while the two Nasdaq indices and the Russell 2000 small cap were best performers along with NYSE Financials (+0..6-0.8%). Another ‘gotcha’ day…back to back for bonds! To recap bonds: yesterday, the long end oscillated most of the session closing slightly weaker. On Wednesday, bonds rallied on equity weakness: 10’s 2.12% +7/16; 30’s 3.26% +1-1/16; 30 yr TIP 0.88% up just 3/8! This followed Tuesday’s, nearly a 1-1/2 point loss in the 10 year treasury, 2-3/4 on the 30 year, while the 30 year TIP lost nearly THREE points! Worse, all of these broke thru the prior support levels and that cannot be a good thing! They remain weak!

So let’s see what else happened:

* Dow 30 +0.1% vs -0.7%, another 96 point range day the ended with a 22 point gain, vs +0.7% vs +0.1% vs –0.1% vs –0.5%; Dow Transports +0.2% vsw -1.1%! vs flat vs -0.5% vs +0.2% vs -1.6%!!!; Russell 2000 +0.6% vs -1%! vs +1.3% vs -0.1% vs +0.2% vs -1.7%!!!; Dow Utilities flat vs -1.5%!!! vs -1.4%!!! vs -1.1%!!! vs -0.6%! vs -1.6%!!!; S&P 500 +0.4% vs -0.7% vs +0.6% vs -0.1% vs -0.3% vs -0.8%; Nasdaq Composite +0.7% vs -0.6% vs  +0.9% vs flat vs -0.1% vs -1.1%!!!; NDQ 100 +0.6% by 7:3 with Apple providing 5.4 of the 17 points gained, vs -0.6% vs +0.7% vs flat vs -0.3% vs -0.9%!!!.

*NYSE Volume dipped slightly to a still average 3.47B shares vs 3.56B vs 3.43B vs 2.75B (2013 low) vs 3.27B vs 4.32B.  REAL NYSE Volume also dipped slightly to 711 shares vs 722M vs 734M vs 587M vs 683M vs 855M (highest since 4/30). Recent highs were 975M (selloff) to 887M (rally). The average last week was another weak 728M shares vs 726M vs 720M vs 687M vs 859M vs 689M!!! The 12-month average is just 722M 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 now been just 17 800M+ shares in 2013 – just 5 up, 12 down, but on trades of less than that 78 have been up and just 25 down…there have been 21 mixed sessions.

*new 52 week highs have ranged from 100-864. They rose yesterday to 300 vs 175 vs 517 vs 138!!! vs 811 vs 763 vs 649 vs 811 vs 726. New lows were halved to 108 vs 191 vs 79 vs 49 vs 63 vs 41 vs 31 vs 63 vs 67 (recent range 29-237).

  1. Advance/Declines were slightly positive: +1.3x vs -3.8x!!! vs +1.4x vs -1.2% vs -1.4x vs -3.5x! (recent range -7.1x to +4.4x) on NYSE and +2x vs -2.3x vs +2.4x vs +1.1% vs +1.1x vs -2.9x! vs +1.2x vs -3.3x! (recent -3.5x to +3x). Breadth was better: +2x vs -1.7x vs +1.8x vs -1.5x vs -1.5x vs +1.6x vs -3.2x! (recent -10.5x to +6.4x!!!) on NYSE and +3.5x vs -1.6x vs +2.5x vs +1.1x vs -1.1x vs +1.2x vs -3.3x! (recent -12.8x to +6.2x)  
  2. NYSE Financials rose 0.8% for best performer vs – 0.3% vs +0.7% vs -0.3% vs -1% vs +1.2%. BofA surged another 3.3%??? vs +1.5%??? vs +0.8% vs flat vs -0.8% vs -1% to $13.54 +…20…14th day above $13 since 4/11/11 – all this month! No time to be superstitious.
  3. Volatility (S&P VIX) slipped modestly to 14.53 -.30 (9th day above 13 since May 2). It set a new recent high of 15.65 intraday – cheap time to buy puts is past. The range since 4/12 11.99 (multi year low) to 18.20, and it is back above the 40/50 day (13.37/13.61) with res at 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 weaker, ex Japan which plunged yesterday; India SLAMMED! UK -0.9%! vs +0.2% vs -1.6% vs +1.8% vs -0.5% vs -1.7%!; France -0.7% vs +0.7% vs -1.3% vs +1.5%! vs +0.2% vs -2.4%!!!; Germany -0.6% vs +0.5% vs -1.5%!!! vs +1.2% vs -0.5% vs -2.5%; Japan UP 1.4% vs DOWN 5.2%!!! vs +0.1% vs +1.2% vs +0.9% vs -7.3%!!! vs +1.6%; Hang Seng -0.4% vs -0.3% vs -1.6%!!! vs +1.1% vs -0.2% vs -2.5%!!!; Korea +0.1% vs -0.1% vs +0.8% vs +0.3% vs +0.2% vs -1.2%!; India -2.3%!!! vs +0.3% vs -0.1% vs +0.7% vs +0.2% vs -1.9%!. U.S. stock futures weaker in a wide ranging ‘whipsaw‘ session: DOW -71; SPX -7.30; NDQ -12.25.  Stocks opening slightly weaker but in a ‘carbon copy’ of yesterday, creeping back to breakeven and soon higher? Makes no sense to this student of markets…but hey…

Bonds are only slightly higher overnight on equities weakness, but were modestly lower yesterday and remain well below the recent trading range which had been major (critical?) support: 10 yr Treasury 2.09% +5/32 (recent range now 2.17% to 1.63%!!!), and the 30 yr’s 3.33% to 2.82%!!!, now 3.27% +1/8. The long TIP continues to be hammered losing over a point yesterday and putting in another new high of 0.94%!!! it is now 0.93% +1/4 – still the weakest link since a new (record?) low of 0.36% on 4/5. Since the Bernanke announcement on the 7th the high yield has gone from 0.82% set on 5/22 to 0.94%! Libor update: 0.275% 3 mos., 0.414%!!! 6 mos. Foreign bond yields mixed…Greece slammed again! Germany 1.48% -4; UK 1.95% -1; France 2.06% -4, Italy 4.13% +3; Spain 4.42% +7!; Portugal 5.53% +9!; Greece 9.20%!!! UP 40!!! vs 8.80% vs 8.54% vs 8.39% vs 8.63% vs 8.54% vs 7.98% vs 7.97% vs 7.94% vs 7.96% vs 8.47% – it has now broken down from the rally! Recent range 7.94% to 12.57%). Japan 0.85% -5.  

Gold closed higher for a 2nd day at $1412.00 +$20.20 – that’ $32 in two days! With an intraday high of $1417.70, highest since 5/15, despite Tuesday’s negative key reversal  Reversal of fortune? It has been down 10 of the last 14 sessions following 5/20’s intraday low of $1338, lowest since 4/18, at $1387.50 -$5.30. 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. Despite taking out the psychological $1400, resistance remains at the 40 day/50 day: $1444-1475 – falling rapidly now! Overnight it is $1404.60 -$7.40, with a low of $1402.50. Crude closed slightly higher following Wednesday’s rout, at $93.61 +.48 but only after a sesson low of $91.65, lowest since 5/2 and third test of the 200 day m/a! It is trapped between the 40/50 day, just two days after a high of $95.92 – highest since 5/22!  The rally high was set 14 days at $97.17, nearing a 12 month high! Overnight it is sharply lower at $92.64 -.97, with a session low of $92.43. It is again below Res at the 40 day ($93.26), 50 day ($93.66) but slightly above the  200 day ($92.32). 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:

It’s hard to keep the stock market down…ignore the facts and look at the recent earnings with total disregard for their sustainability…despite economic evidence to the contrary. Still, don’t bet against it…but don’t get sucker-punched into it. Same goes for bonds – especially the now-lowly, once-loved TIPS!

We survived this holiday shortened week at least…didn’t we???

Have a fun weekend!

TB

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: