10/9/13 Tuesday Closing Summary

NOTE: there will be no blog from 10/9-10/19 as TB will be in Peru.

Today’s Quote from the Friars Club Encyclopedia of Jokes: “If penicillin is such a wonder drug, how come it can’t cure bread mold?” – Ron Smith

Tuesday Market Summary

Volume rose sharply to 3.54B shares…a huge negative as it was a decidedly down session…vs 2.57B vs 2.78B vs 3.25B shares where it had resided for FOUR straight sessions. All indices were highly negative, led by the two Nasdaq indices, -2% vs -1%, followed by the Russell 2000 small cap -1.7% vs -1.2%! and Dow Transports -1.1%. The only positive Dow Utilities – which is a negative for the rest of stocks, +0.6% vs -0.4%. The sub-index, NYSE Financials declined by another 1.3% vs -1% and look: NYSE Brokers -1.6% vs -1.6%!, KBW Banks -1.1% vs -1.8%!, Nasdaq Banks -0.6% vs -1.5%! A second trifecta!

The Nasdaq 100 was pounded and is fading fast losing another HUGE 62 points vs -62 vs -27 vs +29 vs -39.4 vs -0.2 vs +35 vs -12 vs -3.7 vs +25.5 points with 9 members moving by more than TWO points – all down! Decliners ran -24:1 vs -4:1 vs +9:1 vs -19:1!!! Let’s look again at the leaders and their changes over the past several sessions that they were leaders: MSFT -4.1 vs n/a vs +2.5 vs +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; AMZN -3.7 vs +1.7 vs -2.4 vs +5.4 vs -1.4 vs +2.2 vs -2 vs +1.7; AMGN -1.8 vs +1.3 vs -1 vs -1.4;  GILD -1.7 vs +1.8 vs -1.2; GOOG –1.6 vs -1 vs -2.8 vs +2.9 vs -2.3, n/a -4.1, +1.2,-1.2, +4.2; -1.5; QCOM -1.3 vs +1.4; CELG -1.2 vs +1.3 vs -1.2; EBAY -1.2; CMCSA -1; and now the contrarian…   

Advance/Declines and Breadth were both HIGHLY NEGATIVE. New 52 week highs were slashed for a second day while new lows rose and are no longer considered weak. VIX EXPLODED to the upside setting another new recent high and of 21.01 and closed at 20.34 +.93!!! Very close to the high for the year 21.92 on 6/24. Huge danger sign!

Bonds closed little changed but wouldn’t you have thought they might get some benefit from stock weakness??? But Japan joined China in warning against degrading treasuries.  Crude closed almost unchanged too. Gold closed modestly lower and still safely above $1300…at least for now!

Dow 30 -1.1% vs -0.9% vs +0.5% vs -0.9% vs -0.4%; Dow Transports -1.4%! vs -1.1% vs +0.5% vs -1.1% vs -0.4%; Russell 2000 -1.7%!!! vs -1.2% vs +0.7% vs -1.1% vs -0.5%; Dow Utilities +0.6% vs -0.4% vs +0.2% vs -1.2% vs +0.1%; S&P 500 -1.2% vs -0.9% vs +0.7% vs -0.9% vs -0.1%; Nasdaq Composite -2%!!! vs -1% vs +0.9% vs -1.1% vs -0.1%; NDQ 100 -1.9% vs -0.8% vs +0.9% vs -1.2% vs flat.

*NYSE Volume soared to 3.54B shares – bad news on a down day – from a weak 2.57B vs 2.78B after being steady 3.25B for four days (Record high (?) 4.82B shares on Sept. options expiry while 2.52B is 4th weakest of 20131.96B is the low). REAL NYSE Volume remained rose sharply to a strong 733M shares vs 595M vs 597M vs 703M vs 691M vs 717M vs 878M (2.06B shares also on Sept. 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 690M shares, ranging from 482M to 2.025B shares on 9/20. There have been just EIGHT 1B+ share sessions! There have been 33 800M+ shares in 2013: 13 up, 18 down, and two mixed.

*New 52 week highs have ranged from 33-864. They declined to 99 vs 142 vs 289 vs 232 vs 297. New lows rose to 115 vs 73 vs 56 vs 69 vs 64 vs 48.

  1. Advance/Declines were highly negative: -4.2x! vs -3.6x vs +1.9x vs -3.7x vs -1.3x (recent range -17.5x to +6x) on NYSE and -4x vs -2.9x vs +2.2x vs -2.8x vs -1.5x (recent now -4x!!! to +3.8x). Breadth was even worse: -7.6x!!! vs -2.9x vs +2.6x vs -4x! vs +1.4x (recent -18.6x!!! to +7.2x!!!) on NYSE and -11x!!! vs -2.5x vs +3.5x vs -3.6x vs +1.2x vs +3.4x (recent -12.8x to +6.5x).  
  2. NYSE Financials plunged by another 1.3% vs -1% vs +0.7% vs -0.8% vs flat. BofA most active and has obliterated $14, -0.9% vs -1.7%!!! vs +0.4% vs -0.1% vs +1.2%, closing at $13.69 -.12 – now below the levels from 8/30! It had struggled since hitting $15.03 on 8/1 – highest since Jan. 14 and major res. Brokers -1.6%! vs -1.6%! vs +1.1% vs -1.2% vs -1%; KBW Banks -1.1% vs -1.8%!!! vs +1.3% vs -0.5% vs -0.5%; Nasdaq Banks -0.6% vs -1.5%!!! vs +0.8% vs -0.5% vs -1.1%.
  3. Volatility (S&P VIX) exploded up surging to 21.01 before settling at 20.34 +.93!!! – highest close since 6/20!!! Range was at 18.98 to 21.01. On 8/30 it closed at 17.01 but a week prior it was at 13.98. The recent range is now 11.83-21.01!!! It peaked at 22.79 on 12/28/12. It is now well above the 40 day (15.10), the 50 day (14.65) and the 200 day (14.47)…ytd the range is 11.05 (3/14) to 21.92 (6/24)!

Bonds closed little changed: 10 yr Treasury 2.64% -1/16 (recent range 2.99% to 1.63%!!!), and the 30 yr range 2.67% to 3.90%, 3.69% flat. The long TIP is 1.36% -3/32. 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 at or setting new record lows: 3 mo. 0.244% and the 6 mos. 3.666%, respectively. Foreign bonds closed little changed and mixed – ex-Greece. Germany 1.81% +1; UK 2.69% -1; France 2.34% +1; Italy 4.34% +5; Spain 4.29% +9; Portugal 6.23% -3; Greece 8.98% +15 vs 9.10% vs 8.98% 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 0.65%.

Gold closed slightly lower at $1318.70 -$5.90 but remains safely above $1300, no mean feat after putting in a low of $1276.80 on 10/2 – lowest since 8/8 – then closing above $1300 at $1320.70. Recent high was $1375.40 on 9/19.  6/27’s intraday low was $1179.40 – lowest since at least 2011 and critical support. $1300 remains psychological support, while the 40 day ($1352) and the 50 day ($1342) are MAJOR RESISTANCE. The 200 day is at $1460.

Crude closed about even making 10 of the last 13 sessions down days and closing at $103.51 +.02 – a day following the disturbing low print of $101.86 but above Wednesday’s intraday low of $101.06, a double bottom and thus major support – lowest since 7/5!!! 9/18’s session high was $108.49 from $104.94! Recent rally high and close is $110.70 and $110.53 respectively. It is way below the 40/50 day m/a’s ($106.08-105.92), and crossed! The 200 day ($98.02) is major support!!! 4/18’s low of $85.61 was lowest since 12/11! Major Res is the spike to $112.24 on 8/28. That move was immediately rejected! The range is $85.61-$112.24 since March 1, 2012.

 

Some random thoughts:

This is no way to run a country…any country…but especially the United States of America! Shame on Congress!!! All of them.

See you in ten days…and I will be happier for it!

TB

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