12/10/13…two party rule…or just one?

Joke of the Day from the Friar’s Club Encyclopedia of Jokes: When Joe Louis was asked who had hit him hardest in his boxing career, he said, ‘That’s easy – Uncle Sam!’”

Bloomberg Quote of the Day: “Opinion is ultimately determined by feelings, and not by the intellect.” – Herbert Spencer…obvious to us today but well-phrased.

Bloomberg Top Stories:

*Volcker Rule Eases Market-Making While Hedges Will Face Increased Scrutiny–Jamie?

*U.S. Stock-Index Futures Retreat While Oil, Gold Lead Commodities higher –go figure!

*OPEC Pumps Least Crude in More Than Two Years as Saudi Arabia Cuts Output-Iran?

*Coeure Says ECB to Condition Loans to Banks on Money Entering Real Economy – ???

*London Allure to Foreign Property Buyers Seen Dimmed by Capital Gains Tax

*Bonus Pools at Biggest Canada Banks Rise Least Since 2010 as Profit Cools – awww!

*How Volcker’s Simple Idea of Risk Grew to Size of a Phone Book

*Bipolar Yen Seen as Key to Traders’ Profits in Second-Worst Year of Losses

*Mandela’s Funeral Rivals JFK’s as World Leaders Assemble in South Africa

*Obama Says Mandela’s Death Is Chance to Promote His Work on Reconstruction

*Cloaked Obamacare Website Costs Show Lack of U.S. Government Transparency-Fix it

*Why Are Biggest Investors Sitting on Giant Piles of Cash?: by Barry Ritholtz

Monday’s Market Summary:

Nice rally Friday, right? Weird, but nice. But where was the follow-thru yesterday? Not only that but the Russell 2000, was off by 0.2%??? Dow Utilities were the goat, -0.5% a day after rising 1.2%!?! Adding to the strange brew was Dow Transports rose the most +0.4% while the Dow 30 closed FLAT with a range of just 33 points and moved in slow motion so the only positive was that it held 16k, barely. One tired dog, no? The rest ranged from +0.2-0.3%. NYSE Financials which rose 1.3% Friday (which TB questioned the rationality of), lost 1% yesterday…hmmm.

Nice set-up for Friday the 13th – right? At least the final options expiry of 2013 is the following Friday…based on volume that might be a bad thing!

NYSE Volume was stable at a well below average 3.11B shares vs 3.13B vs 3.32B vs 3.6B vs 3.44B vs 3.08B and the 12-month low of 1.59B shares on 10/29! Meanwhile, Real NYSE Volume, which was coming off a 12-month low of just 474M shares on 10/29 plunged to a weak 480M shares from a well below average 671M vs 700M vs 756M vs 770M vs 657M.

Advance/Declines and Breadth were about even and very confusing due to low volume. New 52 week highs were stable at 322 vs 326 vs 145 vs 153 vs 151 vs 331, while new lows slipped to 125 vs 149 vs 190 vs 126 vs 132 vs 108. VIX closed lower a day after plunging through TWO handles (15/14) to 13.50 -.29. Hmmmm!

Bonds had minor gains again but remain close to the highs of August and November: 3.92-3.93%! Gold closed slightly higher in an inside session at $1234.20 +$5.20. a day after putting in a new low of $1210.10! Remember Wednesday was a positive key reversal after printing $1210.80, lowest since $1187.90 on 6/28, the lowest since July 2010! Crude was slightly weaker five days after setting a new low of $91.77 – lowest since June 3rd! It closed at $97.34 -.31 and like Gold had an inside session??? Friday’s session high was $98.07, highest since 10/30! The record high of $114.83, courtesy of JPM/MS/GS’s manipulation (not necessarily in that order was on 5/2/11), while the low since on 10/4/11 was $74.95: $93.60 is the midpoint!!! Overnight it hit $98.74, highest and first time above the 200 day (98.53) since 11/20!

The Nasdaq 100 GAINED 12 points vs +26.5vs -5 vs -3.7 vs -2 vs -7 (would have been -16 if APPL hadn’t saved the day). BUT breadth was -9:5 vs +4.8:1. Apple was back on top yesterday along with five others gaining more than one index point, while only BIIB lost one point: APPL +5.2 vs -6.4!!! vs +2.4 vs -1.1 vs +12.3!?! vs -3.9 vs +8.2!!! vs +9.9!!! vs +7.8!!!; MSFT +2.3 vs +2.7 vs -7 vs +4.7 vs +2.4 vs +3.9 vs -2.2; GOOG +2 vs +3.1; GILD +1.6 vs +1.1 vs +1; FB +1.5; CELG +1.3; BIIB-1.2 vs+1.3;

Dow 30 FLAT vs +1.3%! vs -0.4% vs -0.2% vs -0.6% vs -0.5%; Dow Transports +0.4% vs +0.6% vs flat vs -0.4% vs -1% vs +0.3%; Russell 2000 -0.2% vs +0.8% vs +0.1% vs -0.2% vs -0.5% vs -1.2%!!!; Dow Utilities -0.5% vs +1.1%!?! vs -0.9% vs +0.2% vs +0.6% vs -0.4%; S&P 500 +0.2% vs +1.1% vs -0.4% vs -0.1% vs -0.3% vs -0.3%; Nasdaq Composite +0.2% vs +0.7% vs -0.1% vs flat vs -0.2% vs -0.4%; NDQ 100 +0.3% vs +0.8% vs -0.2% vs +0.1% vs –0.1% vs -0.2%.

*NYSE Volume, was stable at a very weak 3.11B shares vs 3.13B vs 3.32B vs 3.6B vs 3.44B vs 3.08B vs 1.59B (12-month low). The record high (?) is 4.82B shares on Q3 end of quarter while 11/29’s 1.59B is weakest of 2013, replacing 1.96B as the low). REAL NYSE Volume PLUNGED to the lowest since 11/29, 480M shares vs 674M vs 700M vs 756M vs 770M vs 667M vs 474M (new 12-month low) vs 482M (2.06B shares on the Sept. expiry was 3rd highest ever: 6/30/06 3.38B; 7/12/02 2.29B while monthends 474M is the new 12-month low). Compare to last weeks average of a strong 713M shares! Since 11/11 the high has been 828M shares on 11/26 followed by 796M shares on 11/15, and five days with a ‘7’ or higher handle! The 12-month average is 721M shares. The average since 6/28’s 1.75B share day is just 695M shares, ranging from 482M to 2.025B shares on 9/20. This year there have been just NINE 1B+ share sessions! There have been 38 800M+ shares in 2013: 16 up, 19 down, three mixed.

*New 52 week highs have ranged from 33-864. They were stable at 322 vs 326 vs 145 vs 153 vs 151 vs 332 vs 560. Recent high is a super-strong 890!!! New lows slipped to 125 vs 149 vs 190 vs 126 vs 132 vs 108 vs 35.

  1. Advance/Declines were neutral to negative: 1:1 vs +2.6x vs -1.9 vs -1.6x vs -1.6x vs -2.5x vs +1.2x vs +1.7 vs +1.3x (recent range -17.5x to +6x) on NYSE and -1.4x vs +2.1x vs -1.2x vs -1.4x vs -1.6x vs -2.5x (recent -4x!!! to +3.8x). Breadth was slightly positive to neutral: +1.7x vs +2.4x vs -2x vs -1.1x vs -2x vs -2x (recent -18.6x!!! to +7.2x!!!) on NYSE and 1:1 vs +1.8x vs -1.5x vs +1.1x vs -1.6x vs -1.4x (recent -12.8x to +6.5x).  
  2. NYSE Financials lost 1% vs +1.3%!?! vs +0.8% vs -0.1% vs -0.9%. BofA 2nd most active +0.2% vs +0.8% vs -1.3% vs +0.6% vs -1.2%, closing at $15.59 +.03, 11/25’s 12-month high was $15.98, highest since 6/1/10. Brokers flat vs +1.6%!?! vs -0.6% vs flat vs -1%!; KBW Banks +0.3% vs +1.4% vs -1%! vs +0.4% vs -1.1%! vs -0.2%; Nasdaq Banks -0.4% vs +1.7%! vs +0.1% vs -0.1% vs -0.9% vs -1.2%!!!
  3. Volatility (S&P VIX) closed down after plunging through two handles (15/14), after having risen for FIVE straight sessions, closing at 13.50 -29. This from the highest close since 10/15, while last Wednesday’s session high was 15.71!!! and the session low was 14.22!! It has created an ‘island formation’ from 14.22-15.71, 12/4’s range!?! It is now just below the 40 day and the 50/200 day m/a’s: 13.57/14.35/14.38!!! The recent range is 11.83-21.01!!! Since March 11th the average has been just 14.44…way below the five year average of 23.32~~~ and the It peaked at 22.79 on 12/28/12…ytd the range is 11.05 (3/14) to 21.92 (6/24)!

Global stocks weaker: UK -0.5% vs – vs +0.5% vs +0.1% vs -0.5% vs -0.7%; France -0.7% vs – vs +0.3% vs -0.1% vs -0.9% vs -1.8%!!!; Germany -0.8% vs +0.4% vs +0.7% vs +0.1% vs -1% vs -1.3%!!!; Japan -0.3% vs +2.3%! vs -0.8% vs +1.5%! vs -2.2%! vs +0.6%; Hang Seng -0.3% vs +0.3% vs +0.1% vs -0.1% vs -0.8% vs -0.5%; Korea -0.4% vs +1%! vs -0.2% vs -0.1% vs -1.1% vs -1.1%; India -0.3% vs +1.6%! vs +0.2% vs +1.2%!!! vs -0.7% vs -0.2%. U.S. stock futures also weaker: DOW -62; SPX -6; NDQ -10.

Bonds closed slightly higher but still have not recovered from Wednesday’s poinding for the fourth time since last August when the ‘tapering talk’ began at  3.87% on the 30 yr while the 10 yr closed at 2.85% for the first time since hitting 3% on 9/5! Doing better again overnight: 10 yr Treasury 2.80% +5/16 (recent range 1.63% to 2.99%), and the 30 yr 3.83% +3/4 (recent range 2.67% to 3.92%). The long TIP is 1.54% +7/8. The (record?) low of 0.36% was set on 4/5. NOTE recent high yield: 1.63%! Libor update: 0.242% 3 mos, 0.344% 6 mos. (just above record lows!). Foreign bond yields lower: Germany 1.82% -2; UK 2.87% -5!; France 2.42% -2; Italy 4.07% -5; Spain 4.03% -7; Portugal 5.96% -1; Greece 8.58% -9. Recently: 7.71% – 12.57%. Japan 0.65% flat.

Gold closed slightly higher in an inside session after Thursday’s bizarre session falling $23 on an inside day which nearly obliterated Wednesday’s big gain. It closed at $1234.20 +$5.20. Last Friday’s low was $1210.10, lowest since 6/28. Recent high is $1375.40 on 9/19. 6/27’s intraday low was $1179.40 – lowest since at least 2011 and critical support. $1300 remains psychological resistance with major res at the 40 day ($1286!) and the 50 day ($1291!), falling again. Major resistance at $1375, the 9/19 high. The 200 day is a $1380. Overnight it is STRONG at $1256.10 +$22, with a session high of $1260.10 – highest since 11/20!.

Crude lost a bit following five straight positive days following a new low of $91.77, lowest since 6/3!!! The record high of $114.83, courtesy of JPM/MS/GS’s manipulation (not necessarily in that order) was on 5/2/11, the low since on 10/4/11 was $74.95: $93.60 is the midpoint!!! It closed at $97.34 -.31. Friday’s session high of $98.07 was highest since 10/29! First time it has shown any 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 back above the 40/50 day m/a’s ($96.11!/97.46!), both still dropping AND major resistance/support! The 200 day ($98.53). Thus very 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 it is higher at  $98.30 +.96 WITH a session high of $98.74 – first time above the 200 day since 10/22!

Some random thoughts:

We are witnessing the demise of a once great party…the GOP (whether you agree with their tenets or not). That is a bad thing for America because while they work to destroy rather than fix the ACA, stall Congress, cannot be controlled by the House Speaker while the Senate Minority Leader is part of the problem, and repeatedly hold us hostage to their negotiations, obfuscate and stall on immigration reform on spurious theories, the people are suffering, and the risks to this country along with global perception are in peril.

Is this what you want to see? Even if you are a Democrat, do you want just one party, especially when the parties themselves, not the electorate, choose candidates? Democratic republic my ass!

In spite of this, hope you all have a nice day!

TB

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