10/2/13…how did you do last quarter?

Today’s Quote from the Friars Club Encyclopedia of Jokes: “After paying for the wedding, all a father has to give away is the bride.” – unattributed

 

Bloomberg Quote of the Day: “When the going gets weird, the weird turn pro.” – Hunter S. Thompson…or run for office! TB

 

Bloomberg Top Stories:

*Stocks Drop With Metals on U.S. Shutdown as Yen Rallies, Treasuries gain…sort of!

*Companies in U.S. Added Fewer Than Estimated Workers Last Month, ADP Says – !!!

*Draghi Says ECB Stands Ready to Keep Money Market Rates Lower for Longer – Libor is at record lows…even after the bailout…’splain it to me, Lucy!

*Dollar Seen as U.S. Shutdown Loser as Economy Hit Prolongs Fed QE Program

*Gross Says Buy Debt That benefits From Fed Keeping Rates Lower for Longer

*BofA Joins Wells Fargo Saying Debt Tops Stocks in Gridlock – hmmm

*U.S. Government Shutdown Persisting Threatens Housing Recovery – get it???

*Biggest Banks Face Higher Bar as Lenders Submit Next Round of Living Wills

*AIG Names Erica McGinnis CEO of Broker-Dealer Unit Overseeing $139 Billion-why?

*Shutdown Causes Auto Shivers as Industry Sales Show Sustained Demand

*NFL Free Agent Lawyer Kessler Set to Unlock $16 Billion for NCAA Athletes

*Letta Wins Italy Confidence Vote as Berlusconi Threat Muted by His Party – Good!

*Boehner Appease Fractious Republican Caucus With Stance on U.S. Shutdown – fools!

*Russia Charges U.K., Brazil, Fniland Citizens With Piracy in Arctic Case

*De Blasio Mayorial Campaign Shaped by Chid-Abuse Case That Shook New York

A new quarter and a solid rally led by Dow Transports +1.4% followed by the Russell 2000 +1.3%, and the two Nasdaq indices up 1.1%. Even Dow Utilities closed up 0.4%. The Dow only rose by 0.4% and the S&P 0.8% while NYSE Financials gained 0.9%.

The Nasdaq 100 gained 35 points vs -12 vs -3.7 vs +25.5 points with 8 members moving by more than a point…all of them up! Advancer bested by 3:1. Let’s look again at the leaders and their changes over the past 12 sessions that they were leaders: APPL +9.1 vs +4.9 vs -2.8 vs +3.8 vs -6.1 vs -1.7 vs +19.2!!! vs -4.4 vs +6.4 vs +7.9 vs +4.2 vs -12.3 vs -6.5; FB +1.4 vs +1.5 vs +1.6 vs +1.9 vs +2.5 vs +1.2 vs n/a vs +4 vs -2.8; AMZN +5.4 vs -1.4 vs +2.2 vs -2 vs +1.7, vs n/a, vs +3.2, +3.3; GOOG +2.9 vs -2.3, n/a -4.1, +1.2,-1.2, +4.2; MSFT +2 vs +3.9 vs +2.1 vs -2.5 vs -6.9 vs +2.2 vs +3 vs +1 vs -1.4 vs +2; AMGN +1.8; PCLN +1.3; CELG +1.2; YHOO +1.1 vs -1.4, n/a -1.7. Advance/Declines and Breadth were both strong. New 52 week highs surged while new lows fell and remain weak. VIX REVERSED its gain from Monday and is back below 16 following Monday’s high of 17.49!!!

Bonds continue to take one step forward and two back as the debt limit fiasco continues.. Crude closed moderately lower and very weak, and creating a new double bottom at $101.05 – lowest since 7/5! Gold was pounded falling to the lowest since 8/8 before stabilizing. $1300 is now major support both psychological and technical..

Dow 30 +0.4% vs -0.8% vs -0.5% vs +0.4% vs -0.4%; Dow Transports +1.4% vs -0.2% vs -0.6% vs +0.4% vs -0.7%; Russell 2000 +1.3% vs flat vs -0.4% vs +0.5% vs -0.1%; Dow Utilities +0.4% vs flat vs -0.7% vs -0.2% vs 0.7% vs -0.1%; S&P 500 +0.8% vs -0.6% vs -0.4% vs +0.4% vs -0.3%; Nasdaq Composite +1.2% vs -0.3% vs -0.2% vs +0.7% vs -0.2%; NDQ 100 +1.1% vs –0.4% vs -0.1% vs +0.8% vs –0.3%.

*NYSE Volume was pretty steady at 3.16B shares vs 3.28B vs 2.96B vs 2.79B vs 3.12B (Record high (?) 4.82B shares on options expiry while 2.52B is 4th weakest of 20131.96B is the low). REAL NYSE Volume however fell to a nearly average 717M shares vs 878M – 1st time above 800M in a week – vs 636M vs 603M vs 641M. (2.06B shares also on expiry was 3rd highest ever (6/30/06 3.38B; 7/12/02 2.29B while 482M on 7/3 in a shortened trading session is the 2013 low). The 12-month average is 719M shares. The average since 6/28’s 1.75B share day, is just 692M shares, ranging from 482M to 2.025B shares on 9/20. There have been just EIGHT 1B+ share sessions! There have now been 33 800M+ shares in 2013: 13 up, 18 down, and two mixed.

*New 52 week highs have ranged from 33-864. They surged to 424 vs 181 vs 186 vs 271 vs 276. New lows fell back to 48 vs 64 vs  51 vs 44 vs 43 vs 49 – weak!

  1. Advance/Declines were strong: +2.6x vs -1.5x vs -2x vs +1.8x vs 1:1 (recent range -17.5x to +6x) on NYSE and +2.6x vs -1.2x vs -1.6x vs +1.5x vs -1.1x (recent -3.5x to +3.8x). Breadth was even more so: +3.7x vs -2.2x vs -2.7x vs +1.4x vs 1:1 vs -1.1x (recent -18.6x!!! to +7.2x!!!) on NYSE and +3.4x vs -1.7x vs -1.2x vs +1.9x vs +1.4x (recent -12.8x to +6.5x)  
  2. NYSE Financials were positive for the first meaningful gain in more than a week, +0.9% vs  -0.7% vs -0.4x vs +0.1% vs +0.2%.. BofA most active +0.7% vs -0.7% vs -1% vs -0.4% vs +0.5%, closing at $13.90 +.10 – from the lowest levels since 8/30! It has struggled since hitting $15.03 on 8/1 – highest since Jan. 14 and major res. Brokers +0.6% vs -0.7% vs -0.1% vs -0.1% vs flat; KBW Banks +0.9% vs -0.3% vs -0.3% vs +0.7% vs -0.4%; Nasdaq Banks +1.2% vs +0.3% vs -0.3% vs +0.3%.
  3. Volatility (S&P VIX) reversed from the highest close since 8/30, closing at 15.54 -1.06/ Range was at 15.47 -16.46 following a 17.49 high!!! vs last Friday’s low 12.52. A gap remains from Friday at 14.62-16.16!!! On 8/30 it closed at 17.01 but a week prior it was at 13.98. The recent range is now 11.83-17.81. It peaked at 22.79 on 12/28/12. It is now below the 40 day (14. 54), the 50 day (14.21) and the 200 day (14.46)…ytd the range is 11.05 (3/14) to 21.92 (6/24)!

Global stocks weak, ex-Hong Kong; UK -0.6% vs -0.4% vs -0.8% vs -0.8% vs -0.1%; France -0.8% vs +0.6% vs -1.3% vs –0.2% vs -0.2%; Germany -0.6% vs +0.4% vs -1.1% vs -0.3% vs -0.2%; Japan -2.2% vs +0.2% vs -2.1%!!! vs -0.3% vs +1.2%! Hang Seng +0.6% vs closed vs -1.5% vs +0.4% vs -0.4%; Korea flat vs +0.1% vs -0.7% vs +0.2% vs +0.5%; India closed vs +0.7% vs -1.8% vs -0.8% vs +0.2% vs -0.3%. U.S. equity futures weak, opening lower: DOW -73; SPX -11.20!; NDQ -18.50. Looks bad!

Bonds closed weaker and were soft the entire session. They are hovering near the sharp break that began on 8/30! Overnight they are doing better: 10 yr Treasury 2.63% +1/8 (recent range 2.99% to 1.63%!!!), and the 30 yr range 2.67% to 3.90%, 3.70% +1/4.. The long TIP is 1.36% +5/16. The (record?) low of 0.36% was set on 4/5. Recent high yield: 1.63%! Libor update: 0.244% 3 mos, 0.366% 6 mos.  Both setting new record lows: 6 mos. 3.67%, and the 3 mo. 0.244% respectively. Foreign bond yields little changed ex -Portugal which is very weak, and Greece up slightly but still near lowest since 6/4! Germany 1.80% +1; UK 2.71% -1; France 2.32% -1; Italy 4.37% -4; Spain 4.21% +6; Portugal 6.67% +26 vs 6.46%; Greece 8.98% +4 vs 8.85%!!! -21!!! vs 9.22% vs 9.15%!!! -30!!! vs 9.48% vs 9.59 vs 9.71%  +10 vs 9.57%!!! -26!!! vs 9.79% -25 vs 10.13 Recent range: 8.04%-12.57%. Japan 0.63% -3.

 

Gold imploded yesterday closing at a WEAK $1286.10 -$40.90 with a session low of$1282.40 – lowest since 8/8!re tumbling to close at $1327.00 -$12.20 and continues to oscillate following Monday’s low of $1313.40 which held as did $1300. The recent low was 9/18 at $1291.50, first time below $1300 since 8/9! Overnight it is being slammed again and traded as low as $1294.10 – lowest since 9/18!!! It is now $1302.60 -$24.40is little changed at $1332.40 -$1.20. Recent high was $1375.40 on 9/19 while 9/10’s high was $1391.40. 9/17’s low $1304.60!!! 8/14’s session low was $1271.80 – lowest since 7/17! 6/27’s intraday low was $1179.40 – lowest since at least 2011 and critical support. $1300 remains psychological support, while the 40 day ($1351) and the 50 day ($1345) are MAJOR RESISTANCE. The 200 day is at $1470. Overnight it is slightly higher at $1294.70 +$8.60 BUT with a low print of $1276.90 – lowest since 8/7!

Crude closed modestly weaker marking EIGHT straight down days closing at $102.04 -.29 – BUT with an intraday low of $101.06, creating a new double bottom and major support – lowest close since 7/5!!! 9/18’s session high was $108.49 from $104.94! Just 16 days ago it set a rally high and close of $110.70 and $110.53 respectively. It is way below the 40/50 day m/a’s ($106.23-.12), and crossed! The 200 day ($97.73) is major support!!! 4/18’s low of $85.61 was lowest since 12/11! Major Res is the high the spike to $112.24 on 8/28. That move was immediately rejected! The range is $85.61-$112.24 since March 1, 2012. Overnight it is little changed at $101.84 -.20 and trading in a tight range.

Some random thoughts:

Summary of a trying quarter…in bonds…and other fixed income including utilities, REITS, and mutual funds. Here it is:

INDEX

September

3rd Qtr.

YTD

12 mos.

3/31/08

Dow Industrials

+2.3%

2.1%

17.6%

15.6%

6.8%

Dow Transports

5.4%

7.0%

25.3%

36.5%

7.8%

Dow Utilities

1.3%

+0.3%

9.7%

5.6%

4.4%

S&P 500

3.1%

5.2%

19.8%

19.3%

6.8%

Nasdaq Composite

5.1%

11.2%

26.1%

23.0%

10.8%

Nasdaq 100

4.7%

11.0%

22.2%

16.9%

12.5%

Russell 2000

6.4%

10.2%

27.7%

30.0%

9.9%

NYSE Financials

4.7%

6.1%

18.9%

28.8%

-0.5%

Gold ETF – GLD

-4.8%

7.6%

-20.9%

-27.5%

6.6%

Sht Tsy ETF – SHY

0.2%

0.3%

0.2%

0.2%

1.5%

30 yr Tsy Bond

0.1%

-3.2%

-12.0%

-15.6%

1.6%

TIP ETF – TIP

1.8%

0.8%

-6.5%

-6.1%

3.9%

Note how for the most part it leveled out over the past 5-1/2 years.

Enjoy your day!

TB

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