6/4/13…a party gone awry

From the Friar’s Club Encyclopedia of Jokes: “No matter how cynical you become, it’s never enough to keep up.” – Lily Tomlin

Bloomberg Quote of the Day: “No duty is more urgent than that of returning thanks.” – James Allen

Bloomberg Top Stories:

*Carry Traders Losing Most Money in Year Amid Bernanke Tapering Speculation

*Global Stocks Advance While Dollar, Yen Weaken on Fed Stimulus Speculation

*Trade Deficit in U.S. Widens From Three-Year Low on Consumer-Good Imports

*Fannie Mae Liquidation With Shrunken U.S. Role Part of Draft Legislation

*Dark Pool Curbs sought by U.S. Exchanges Lobbying to Blunt Trading Exodus – good!

*Morgan Stanley Promotes Seth Weintrob to Run Its Real Estate Banking Unit

*Intel’s Power-Saving Chips at Computex Help PC Makers Fight Tablet Demand

*U.S. Crude Oil Supply Slides From 82-Year High in Survey

*Stanley Fischer Says Critics of Reinhart-Rogoff Are ‘Unfair, Unacceptable’

*Whale of a Trade Gone Awry Revealed at Biggest U.S. Bank With Best Control

*Syrian Combatants on Both Sides Commit Human-Rights Abuses, UN Study Finds

Another ‘dead cat bounce’ day. Volume was solid action was rather boring.  Advance/declines and breadth were slightly positive – except NYSE a/d’s which were slightly negative! Dow Transports were flat after losing 0.8% Friday and NYSE Financials are starting to trade heavy…why not? Income has been coming from fewer charge-offs not gains in interest income…which is actually declining!

So let’s see what else happened:

* Dow 30 +0.9% vs -1.4%!!! (range 276 points, loss 208!!!)  vs +0.1% vs -0.7% vs +0.7%; Dow Transports FLAT vs -0.8% vs +0.2% vs -1.1%! vs flat; Russell 2000 +0.7% vs -1% vs +0.6% vs -1%! vs +1.3%; Dow Utilities +0.1% vs -0.6% vs flat vs -1.5%!!! vs -1.4%!!! – down 6.7% over the past 7 sessions, and since posting a near record  high on 4/30, have plunged 10.3%!!!; S&P 500 +0.6% vs -1.4%! +0.4% vs -0.7% vs +0.6% vs -0.1%; Nasdaq Composite +0.3% vs -1% vs +0.7% vs -0.6% vs  +0.9%; NDQ 100 +0.3% vs -1% vs +0.6% vs -0.6% vs +0.7%.

*NYSE Volume was steady at 3.94B shares vs 3.91B shares vs 3.47B vs 3.56B vs 3.43B vs 2.75B (2013 low).  REAL NYSE Volume fell sharply to a well above average of 880M shares vs 1.35B (highest since 3/15 and 2nd highest of the year!) vs 711 shares vs 722M vs 734M vs 587M. The 12-month average is just 724M 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. Friday was only the fourth day this year to register over 1B shares! There have now been just 19 800M+ shares in 2013 – 6 up, 13 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 slighlyt to 234 from a weak 221 vs 300 vs 175 vs 517 vs 138!!! vs 811. New lows continued to climb to 325 aafter nearly tripling to 290 vs 108 vs 191 vs 79 vs 49 (recent range now 29-290).

  1. Advance/Declines were mixed: -1.2x! vs -5.5x! vs +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 +1.4x vs -2.6x! vs +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 slightly positive: +1.3x vs -6.8x!!! vs +2x vs -1.7x vs +1.8x vs -1.5x (recent -10.5x to +6.4x!!!) on NYSE and +1.2x vs -3.8x!!! vs +3.5x vs -1.6x vs +2.5x (recent -12.8x to +6.2x)  
  2. NYSE Financials rose 0.3% vs -1.7%!!! vs + 0.8% vs -0.3% vs +0.7%. BofA fell 0.8% vs -1.1%! vs +3.3%??? vs +1.5%??? vs +0.8% vs flat to $13.55 -11…but still 16th day above $13 since 4/11/11. Brokers -0.9% vs -1.4%; KBW Banks flat vs -1.7%; Nasdaq Banks +0.6% vs -1.2%.
  3. Volatility (S&P VIX) was nearly unchanged at 16.28 -.02, at highs since 4/18, (11th day above 13 since May 2). Intraday the range was 16.15-17.58 – highest since 4/18. 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 higher, ex-India and led by Japan?; UK +0.7% vs -0.4% vs -0.9%! vs +0.2% vs -1.6%; France +0.5% vs +0.2% vs -0.7% vs +0.7% vs -1.3%; Germany +0.5% vs +0.2% vs -0.6% vs +0.5% vs -1.5%!!!; Japan UP 2.1% vs DOWN 3.7%!!! vs UP 1.4% vs DOWN 5.2%!!!; Hang Seng FLAT vs -0.5% vs -0.4% vs -0.3% vs -1.6%!!!; Korea FLAT vs -0.6% vs +0.1% vs -0.1% vs +0.8%; India -0.3% vs -0.8% vs -2.3%!!! vs +0.3% vs -0.1%. U.S. stock futures slightly higher in another extremely narrow trading range  –  caution!: DOW +11; SPX +2.30; NDQ +6.

Bonds are weaker again overnight after eking out modest gains yesterday: 10 yr Treasury 2.14% -3/16 (recent range now 2.17% to 1.63%!!!), and the 30 yr’s 3.33% to 2.82%!!!, now 3.19% -1/2. The long TIP continues to be hammered and is trying to bounce from another new high of 1.00% set yesterday!!! Currently 0.95% -1/2- 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 1.00%! Libor update: 0.273% 3 mos., 0.412%!!! 6 mos. Foreign bond yields higher ex-BRICKS! Germany 1.56% +4; UK 2.04%! +5; France 2.10% +2, Italy 4.09% -6; Spain 4.40% -5; Portugal 5.62% -10!; Greece 8.83% -34??? vs 9.11% vs 9.20%!!! 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 0.87% +6!  

 

Gold rallied again offsetting Friday’s losses and closed above $1400 again at $1411.90 +$18.90 on an ‘inside’ day. Last Thursday’s intraday high was $1417.70, highest since 5/15, despite Tuesday’s negative key reversal.  Reversal of fortune? It has been down 11 of the last 16 sessions following 5/20’s intraday low of $1338, lowest since 4/18. 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 at the 40 day/50 day: $1436-1467 – still falling rapidly! Overnight it is $1395.40 -$16.50 with a session low of $1394…round and round she goes, where she stops…nobody knows. Crude rallied nicely but only after putting in an intraday low of $91.26 – lowest since 5/2! Still, it closed at $93.45 +$1.48…back above the 200 day after one day below – first since 5/1, making it res/sup at $92.31! It remains below the 40/50 day, just four days after a high of $95.92 – highest since 5/22!  The rally high is $97.11 set 5/20, nearing a 12 month high! Overnight it is slightly lower at $93.34 -.11, just slightly above the 200 day. Res at the 40 day ($93.24), 50 day ($93.66). 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:

 

Bob Dole says the GOP should ‘shut down’ for six months and regroup. But is that possible or even likely? Remember when it was the Dems who excluded the ‘right to lifers’ and how that cost them? Now the ‘minority’ Tea Party is in control of the party and scaring the wits out of Boehner while House Whip Eric Cantor seeks to appease them. Meanwhile the gospel according to Paul Ryan prevails. Is this a dysfunctional group or what??? Party of Reagan, my foot….he wouldn’t be allowed to open his mouth, let alone get the nod from his – and my former – party.

There is no room for true conservatives or fiscal conservatives in a party that is controlled by wealthy elitists (as opposed to ‘the elites’ as ‘the Newtster’ loves to refer to anyone with more than a Bachelor’s degree.

Now they are losing the psychotic Michele Bachmann…yet she remains on the House Intelligence Committee. Not only did she barely beat Graves, the Dem challenger in a district gerrymandered to assure her victory, but her approval ratings are falling fast due to the investigations into her campaign…awww…yet, she manages to say she won’t run again making herself appear in a good light (literally). Gimme a break!

Lose one more election and they are doomed….not a good thing for America!

Have a great day!

TB

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