Published 11/5…it was in draft…mea culpa! TB
Today’s Quote from the Friars Club Encyclopedia of Jokes: “A man cannot be too careful in his choice of enemies.” – Oscar Wilde
Bloomberg Quote of the Day: “No one can make you feel inferior without your consent.” – Eleanor Roosevelt
Bloomberg Top Stories:
*BlackBerry Takeover by Fairfax Collapses; CEO Heins Is Ousted for Chen
*Cohen’s SAC Capital Seen Pleading guilty to Securities Fraud in U.S. Probe – is that hubris or not when the founder/head would destroy his own firm for his pride???
*Stocks Advance With U.S. Treasuries Before Data; Industrial Metals Retreat
*Twitter Increases IPO Price Range3 for a Valuation as High as $13.6 Billion – pass on it and let the opening day suckers get hammered like FaceBook did…you know who will get the shares…flippers! Sheesh, are we stupid or what?
*Weyerhauser to Combine Unit With Tri Pointe in $2.7 Billion Transaction
*Bullard Says Jobs Not Sole Determinant of Fed’s ‘Torrid’ Bond-Buying Pace
*Bill Ackman’s $11 Billion Pershing Square Fund posts 7.9% Gain in October – hmmm reporting monthly? Past performance is no predictor of future…
*Dallas Fed’s Fisher Says U.S. Recovery Hog-Tied by Federal Budget Outlook –DUH!
*Best Equity Market Since 1997 Signaled by S&P 500 Year-End Momentum Guage – can we make it to Dec. 31st though…THAT is the question!!!
*Gold Bug Schiff Counters Goldman Sachs After Metal’s First Drop Since 2009
*Americans’ Four-Year Debt Hangover Seen Ending in Boost to Economic Growth – even student loans…well, no but…
*Atlantic Storms to Hit Europe as November Temperatures Stay Above Average
*Abortion Case Dropped as U.S. Supreme Court Leaves Law in Oklahoma Voided
This week’s economic calendar is packed with important indicators. The highlight of the week will be the Q3 GDP Advance (Thursday) and October Employment Situation report (Friday). We will also get September Factory Orders (Monday), October ISM Non-Manufacturing Survey (Tuesday), Leading Indicators (Wednesday), September Consumer Credit (Thursday), September Personal Income and November Consumer Sentiment Preliminary (Friday). Courtesy of Economic Advisory Service
Friday’s Market Summary:
Stocks recovered most of the loss since Tuesday’s ‘faux’ rally – esxcepty the Russell 2000 small cap (a good indicator of economic growth) which fell by 0.4%, wiping out the gains since 10/10. All other indices were up from 0.1% (both Nasdaq indices and NYSE Financials) to 1.0% (Dow Transports AND Utilities!), Dow +0.5%; S&P 500 +0.3% – huh?
Total NYSE Volume dipped slightly an average 3.67B shares vs 3.82B vs 3.53B vs 3.33B vs 3.19B vs 3.11B. REAL NYSE Volume fell back but to a still solid 810M shares vs 892M (highest since 9/28’s 2.06B on quarterend) vs a below average 687M vs 683M vs 732M vs 670M…hmmm.
The Nasdaq 100 was +0.1% vs -0.2% vs -0.2% vs + 0.3% vs flat. Just FOUR members gained more than 1 point while tow lost more than a point: CMCSA +2; ANGN +1.8; MSFT +1.2; CELG +1.1 vs -1.1 vs -1.4; AMZN -2 vs .+1.2; AAPL -1.9 vs -2.1 vs +6.4 vs +2.6 vs -4.7 vs +5.7 vs +3.8 vs -1.2 vs +10 vs +3.5. Will Apple be up or down today…got a hunch? Bet a bunch!
Advance/Declines were negative, while Breadth was a slightly positive? New 52 week highs dropped again to 194 vs 252 vs 394 vs 460 vs 380 vs 500, while new lows rose again to 84 vs 79 from a weak 46 vs 29 vs 31 vs 34 vs 29! VIX however, declined, closing at 13.28 -.47 with an intraday high of 13.92 vs 14.02 vs 15.27, highest since 10/16! Since hitting 21.34 on 10/9 – close to the 12/28 high of 22.72 and 6/24 high of 21.91.
Bonds closed WEAK with the long end losing over a point! Gold dropped for a second day $1305.60 before closing at $1315.80 -$8.20! Crude was pummeled again closing at $94.61 -$1.67 AND with a session low of $94.36 – lowest since June 26th!!!.
Dow 30 +0.5% vs –0.5% vs -0.4% vs +0.7% vs flat; Dow Transports +1%! vs –0.5% vs -0.6% vs +0.2% vs +0.4%; Russell 2000 -0.4% vs –0.5% vs -1.2%! vs +0.4% vs flat; Dow Utilities +1%!!! vs -0.6% vs -0.6% vs +0.2% vs -0.3% vs +1%!!!; S&P 500 +0.3% vs -0.4% vs -0.5% vs +0.6% vs +0.1%; Nasdaq Composite +0.1% vs -0.3% vs -0.6% vs +0.3% vs -0.1%; NDQ 100 +0.1% vs -0.2% vs -0.2% vs +0.3% vs flat . Just like the summer doldrums, no?
*NYSE Volume slipped to an above average 3.67B shares vs 3.83B vs 3.53B vs 3.3B vs 3.19B vs 3.11B. The record high (?) is 4.82B shares on Q3 end of quarter while 2.52B is 4th weakest of 2013…1.96B is the low). REAL NYSE Volume slipped to a still above average 810M shares vs 892M vs 687M vs 683M vs 732M vs 670M (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 723M shares. The average since 6/28’s 1.75B share day, is just 698M shares, ranging from 482M to 2.025B shares on 9/20. There have been just EIGHT 1B+ share sessions! There have now been 35 800M+ shares in 2013: 15 up, 18 down, and two mixed.
*New 52 week highs have ranged from 33-864. They fell again to 194 vs 252 vs 394 vs 460 vs 380 vs 500. Recent high is a super-strong 890!!! New lows rose to 84 vs 79 from a weak 46 vs 29 vs 31 vs 34 vs 29.
- Advance/Declines were mixed: -1.2x vs -1.5x vs -2.4x vs +1.6x vs -1.2x (recent range -17.5x to +6x) on NYSE and +1.4x vs -1.6x vs -2.8x vs +1.5x vs -1.1x (recent -4x!!! to +3.8x). Breadth slightly positive: +1.2x vs -1.8x vs -1.8x vs +1.8x vs -1.2x (recent -18.6x!!! to +7.2x!!!) on NYSE and +1.1x vs -1.1x vs -2.8x vs +1.4x vs -1.3x (recent -12.8x to +6.5x).
- NYSE Financials rose by just 0.1% vs -0.8% vs -0.5% vs +0.1% vs +0.2%. BofA most rising 0.4% vs -1.4% vs +0.1% vs +0.3% vs -0.6%, closing at $14.02 +.05. It has struggled since hitting $15.03 on 8/1 – highest since Jan. 14 and major res. Brokers +1% vs -0.9% vs -0.5% vs +0.4% vs -0.4%; KBW Banks +0.2% vs -1.1% vs -0.2% vs +0.1% vs +0.2%; Nasdaq Banks -0.2% vs -1.1% vs -0.2% vs -0.2% vs +0.5%.
- Volatility (S&P VIX) declined with a session high of 13.92 vs 14.02 vs 15.27 – highest since 10/16 before closing at 13.28 -.47. The recent range is now 11.83-21.01!!! It peaked at 22.79 on 12/28/12. It is still BELOW the 40 day (15.05), the 50 day (15.23) and the 200 day (14.39)…ytd the range is 11.05 (3/14) to 21.92 (6/24)!
European stocks higher, Asia weaker, Japan/India closed: UK +0.6% vs +0.1% vs -0.4% vs +0.2% vs +0.6%; France +0.5% vs -0.3% vs +0.4% vs +0.1% vs +0.6%; Germany +0.4% vs -0.1% vs +0.1% vs flat vs +0.3% vs -0.2%; Japan closed vs -0.9% vs -1.2% vs +1.2% vs -0.5% vs +2.2% vs -2.8%!!!; Hang Seng -0.3% vs +0.2% vs -0.4% vs +2%!!! vs +0.2%; Korea -0.7% vs +0.5% vs -1.4%! vs +0.4% vs +0.2%; India closed vs +0.2% vs +0.6% vs +0.5% vs +1.7%!!! vs -0.6%. U.S. stock futures higher and at highs of another narrow range: DOW +60; SPX +7; NDQ 18.
Bonds closed sharply lower led by the 30 yr bond and TIP, off 1 point and 1-1/2 respectively, but are rallying a bit overnight: 10 yr Treasury 2.60% +7/32 (recent range 2.99% to 1.63%!!!), and the 30 yr range 2.67% to 3.90%, 3.68% +5/16. The long TIP is 1.39% +3/16. The (record?) low of 0.36% was set on 4/5. Recent high yield: 1.63%! Libor update: 0.238% 3 mos, 0.353% 6 mos. Both plunged overnight to new record lows!!! Banks remain cautious and loaded with cash!!! Foreign bonds little changed and mixed: Germany 1.67% -2; UK 2.64% -1; France 2.14% -1; Italy 4.11% +4; Spain 4.01% +4; Portugal 6.04% +2; Greece 7.73%!!!! +2. Friday’s low of 7.71% was another new low! Recent range now: 7.71%-12.57%. Japan 0.59% unched.
Gold was trashed again losing $33 in two sessions and a low of $1305.60, below both the 50/40 day m/a’s now major res, closing at $1315.50 -$8.20 – another 7 day low! The recent low is $1251 on 10/15 – lowest since 7/10. 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 with major res now at the 40 day ($1324) and the 50 day ($1339). Major resistance at $1375, the 9/19 high. The 200 day is at $1428. Overnight it higher at $1319.20 +$6 but remains weak.
Crude closed sharply lower after falling to $94.36, lowest since 6/26. before coming back to close at $94.61 -$1.67!!! It has shown no sign of strength since 9/18’s surge to $108.49. 9/19’s session high was $108.99! Recent rally high and close are $110.70 and $110.53 respectively. It is way below the 40/50 day m/a’s ($102.43-103.60), both falling fast again, and still major resistance! The 200 day ($98.72) is also major resistance. 4/18’s low of $85.61 was lowest since 12/11! The recent range is $85.61-$112.24 since March 1, 2012. Overnight is lower again at $94.31 -.30…with a session low of $94.06, lowest since 6/26!!!
Some random thoughts:
The more I read of It’s Even Worse Than It looks, by Thomas Mann and Richard Orenstein, to the foremost Constitutional scholars in the country. While the give no pats on the back to the Dems (nor does this writer), unequivocally the GOP in its quest for control of Congress, the Oval Office, and the Supreme Court, have allowed a fractional minority to wrest control of the party on false facts (misinformation and disinformation), and are destroying the very fiber of our government…unless you consider holding the President and the country hostage to their extremist views.
It began with Newt Gingrich but we had a strong president then (Reagan) with broad support of the American people, and a more responsible media (with television, radio, and newspapers now replaced by cable, blogs, tweets, and malicious emails). News programming has been converted from a public service by the networks to a profit center and thus has lost funds for investigative reporting (60 Minutes and Dateline excepted). Instead, responsible reporters like Bill Moyers and Charlie Rose are drowned out by O’Reilly, Hannity, and Limbaugh…oh and of course the loveable (laughable?) Ann Coulter. Take a look at the FOX News Girls…what is their common trait? How about Sarah Palin? One of the powerful (for the last term thankfully) GOP members of Congress is Michelle Bachman…who spews out disinformation and gets rewarded with campaign contributions…Sen. Cruz take note…oh, you already did with your insane filibuster that your own party allowed you to undertake. You are what is wrong with America while disenchantment with the GOP grows…I fell for their blather until the impeachment charges were brought against Clinton…and even then not at first!
Let’s look at some of their lies…it’s all Obama’s fault…and his ACA. Really? Did you know that universal health care was a project of the GOP?…until that is Clinton and later Obama endorsed it! Shutting down the government reduces the budget…minimally in comparison to the pain it inflicts on working individuals (but who cares), and what it does to economic growth.
How about Senate approval on presidential appointments? True, in the past, the Dems did it too but on an infinitesimally small scale…and they were wrong to do so. If any president called you and asked you to serve would you be willing to place your life on hold for a year or more awaiting an answer while subjecting yourself and your family to scrutiny…even if you are eminently qualified for the position? (An aside…we learned in school that Andrew Jackson was the only president to undergo impeachment proceedings – they tried with Clinton but didn’t have the votes, and Ford saved us from going through it with Nixon. If you recall Jackson survived by ONE vote…but do any of you know WHY he was impeached? Aha, Congressional politics! The Senate enacted a law that a president could not remove anyone from his cabinet without prior Senate approval! Do you see the lunacy in this since cabinet members serve at the pleasure of the president? Jackson stuck his finger in their eye in disgust and fired someone…for that he was impeached!).
The point of course is to stop the president from achieving his goals but in the process weakening the government…and what worse time to do this than the past five years??? It is sick…un-American and cruel…while the wealth gap continues to widen and people suffer. Why do you think rebuilding from Hurricane Sandy is going at a snails pace…and in the most important areas of the country (financial center)? Not only do they hold up nominations but they killed Elizabeth Warren’s appointment (now they are paying for it with her as a Senator), and said while Richard Cordray was fully qualified to head the Consumer Protection Agency, they wanted it neutered of would approve no one. That folks is EXTORTION, and like the debt ceiling restrictions, no president can give in to them. In other words, they would rather destroy America than allow Obama to get credit for anything.
Another misunderstood rule is the filibuster. It was not decreed by the Constitution nor even in effect until the beginning of the 20th century…and that to embarrass Woodrow Wilson and keep us out of WWI. Since then it has only been used sparingly and the intent was to allow the minority to express their views or hold up what they felt was bad legislation. This has nothing to do with a minority group OR bad legislation, as most of the times where the filibuster has been used under Obama have later passed by 90 or more members? Minority??? A minority of ONE!!! Right, Sen. Cruz???
But wait you say…if you are correct then the GOP will lose power and it will all be moot. Not so! First, the government is failing to conduct business and the Senate especially is losing its few business days each term (hence no budget), and for what? Ideologues to promote themselves and be rewarded with contributions…from people like the Koch brothers, and powerful lobbies (financial, healthcare, etc.).
Worse, YOU won’t have a choice between two qualified individuals for office as the split widens. Historically, the gap between the right wing of the Dems and the left of the GOP has been quite small…now it is a major fault. Is this the country you want to live in and bring children into the world in. How many of you would gladly change places with your kids? For the first time in our history I believe very few would be willing to do that trade, even to live longer…for what?
Have a great week, but get off your ass and do something!