Quote of the Day from the Friars Club Encyclopedia of Jokes: “Marriage is bliss. Ignorance is bliss. Ergo…” – anon
Bloomberg Quote of the Day: “The least I can do is speak out for those who cannot speak for themselves.” – Jane Goodall
Bloomberg Top Stories:
*Nokia Forecasts Lower Margin on Network-Equipment Slump; Shares Decline
*Emerging-Market Stocks Fall With Metals as S&P Futures Drop, Euro Advances
*Netflix Soars on Possible Shift to Tiered Prices as Outlook Tops Estimates – yawn!
*Venezuela’s Partial Devaluation(?) to Stem Dollar Flight Sends Bonds Plunging –good!
*McDonald’s 4Q ERPS $1.40, Est. $1.39…a lot of matches and +1 cent lately…
*Dubai Group Said to End Three-Year Talks With $6 Billion Debt Agreement – finally!
*United Continental Profit Beats Estimates With More Fliers at Higher Fares
*Davos Is Stalked by Technology Disruptions as Intel to Wal-Mart Challenged – Hello!
*Argentine Default-Era Chaos Relived as Looting Erupts while Dollars Vanish
*NSA Phone Data Program Called Illegal by Federal Privacy Oversight Board – !!!
*Obama’s Strengthening Economy(?) Fails to Resonate With Americans Left Behind L
*Ukraine Opposition Seeks to Pressure Yanukovych After Clashes Turn Deadly*Snowden’s Network of Choice Thwarted NSA Spies With U.S.-Funded Software – he is no hero but had he tried to be a whistleblower and go to Congress, we’d know zip!
Wednesday’s Market Summary:
TB isn’t sure but it may have never happened before: the Dow moving in the opposite direction of the rest of the market! The winner was Dow Transports +1.1%! while the only other loser was Dow Utilities -0.1%. This on a day when there were 440 new highs! Taken higher Friday on credit card companies (which continue to run???), it was up 42 points, 0.3%, on a day when all other indices declined by roughly 0.5%. What pulled it up? Well, despite its breadth being 2.3:1 NEGATIVE, Visa +66.7; AXP +20.5…meanwhile the ‘real’ industrials which sunk the S&P declined: NKE -9; MCD -7.3, and JPM -5.7 (why they put banks in an industrial index is beyond comprehension…except to try to keep up with the S&P 500). Then on Tuesday it FELL 0.3% – cancelling out Friday’s gains and the only loser among the majors! Yesterday? It fell 0.3% again, with -2:1 breadth…led by IBM -40!!!, CAT/PG -6.1, DD/XOM/JPM/MMM/WMT//MRK all losing at least THREE points!!!, while BA added 17.3, followed by UTX/DIS/V +7.
AAPL and MSFT diverged yesterday, with APPL the second biggest gainer (the corrupt AMGN was biggest), while MSFT was the biggest loser at -1.8 vs -1.6 vs 3.8 index points. Remember: they combined for more than two-thirds the loss and on Wednesday (Thursday they were mixed and index barely budged) , half the gain on the index (16 of 29)!!! So think how much they subtracted and added to the S&P? Again, this is why TB provides you with FIVE days of returns instead of focusing day to day. Think for yourself!…or suffer the consequences.
NYSE Volume continues to oscillate, slipping to 3.37B shares vs 3.75B vs 3.65B vs 3.46B shares (average) vs 3.75B (highest since 12/20) vs 3.33B. Real NYSE Volume also declined to a well below average 629M shares vs 753M vs 893M (first time over 800M since 12/20! Remember that was a DOWN DAY!), vs 654M vs 718M vs 650M vs 734M.
The Nasdaq 100 gained 10 points vs +26.5 vs -20 vs +1.5 vs +29 vs +68 points!!! vs -52 points!!! Breadth was positive again at +2:1 vs +1.2:1 vs -1.5:1 vs -1.4:1 vs +7:3 vs +9:1 vs -7:1! Just TWO members gained more than one index point, while four lost more than a point! AMGN +3.4; APPL +3.4 vs +8.5 vs -11 vs -2.5 vs +8.8!!! vs +8.5!; MSFT -1.8 vs -1.6 vs -3.8! vs +1 vs +7.3!!! vs +5.9! vs -7.8!!!; FB -1.7 vs +3.7 vs -1.5; INTC -1.2 vs -1.1 vs -3; AMZN -1 vs +3 vs +1.6.
Dow 30 -0.3% vs -0.3% vs +0.3%? (see above!) vs -0.4% vs +0.7% vs +0.7% vs -1.1%!; Dow Transports +1.4%! vs +0.6% vs -0.4% vs -0.6% vs +0.6% vs +1.3% vs -1.4% vs +1.2% vs +1%; Russell 2000 +0.5% vs +0.6% vs -0.4% vs +0.2% vs +0.7% vs +1.3% vs -1.4%; Dow Utilities -0.1% vs +1.1%!!! vs flat vs +0.7% vs -0.1% vs +0.1% vs -0.9% vs +1.3%!?! S&P 500 +0.1% vs +0.3% vs -0.4%? vs -0.1% vs +0.5% vs +1.1% vs -1.3%; Nasdaq Composite +0.4% vs +0.7% vs -0.5% vs +0.1% vs +0.8% vs +1.7%!!! vs -1.5%!; NDQ 100 +0.3% vs -0.6% vs – vs +0.8% vs +1.9%!!! vs -1.5%!
*NYSE Volume reverted again to 3.37B shares vs 3.75B vs 3.65Bvs 3.46B vs 3.75B vs 3.33B vs 3.57B vs 3.33B. 2014 low is 2.76B. The record high (?) is the 4.97B shares of 12/20/13 and Q3 end of quarter while 11/29’s 1.59B is weakest of 2013). REAL NYSE Volume slipped again to a well below average 629M shares vs 753M shares vs 893M (highest and first time above 800M since 12/20) vs 654M vs 700M vs 718M vs 650M. Above 700M just five times since 12/20! The 12-month low is 272M on 12/24. The average since 12/20 is up to a still weak 623M shares with a new high of 893M! The 12 month is 719M shares. Last year there were just TEN 1B+ share sessions! There have now been 40 800M+ shares since 12/31/12: 18 up, 20 down, three mixed.
*New 52 week highs have ranged from 33-864. They slipped to 440 vs 498 vs 373 vs 419 vs 515 vs 281. Recent low is 201! Recent high is a super-strong 890!!! New lows up slightly to 46 vs 37 vs 40 vs 42 vs 37 vs 36 vs 50. Recent high is 353; low 20!!!
Advance/Declineswere positive: +1.8x vs +1.9x vs -1.4x vs +1.4x vs +1.9x (recent range -17.5x to +6x) on NYSE and +1.4x vs +1.6x vs -1.4x vs +1.0x vs +1.9x (recent -4x!!! to +3.8x). Breadth was similar: +1.4x vs +1.4x vs -1.9x vs -1.2x vs +2.3x (recent -18.6x!!! to +7.2x!!!) on NYSE and +1.7x vs +1.7x vs -1.7x vs -1.2x vs +2.6x (recent -12.8xto +6.5x).
NYSE Financials +0.1% vs +0.1% vs -0.2% vs -0.6% vs +1%.. BofA 2nd most active again +0.8% vs flat vs -0.5% vs -0.4% vs +2.3%!!! Closed $17.15 +.14. It gapped up from $16.77-$17.15 on 1/15 with a high print of $17.42 – highest since 5/10/10!!! Brokers +0.3% vs +0.9% vs -0.5% vs – vs +1% vs +1.1%/ KBW Banks +0.4% vs +1.1% vs -0.3% vs -0.9% vs +1.4%; Nasdaq Banks +0.6% vs +1.8% vs +0.3% vs -0.8% vs +0.5% vs +0.5% vs -0.9%.
Volatility (S&P VIX) was little changed closing at 12.84 -.03, after falling to 11.81 last Thursday. 1815’s close of 12.28 was near its lowest close and low since 8/5/13! From 13.31 with a high of 13.65 to 12.29 -.99 with a low of 11.96! It remains well below the 40/50 day (13.59/13.43) while the 200 day is 14.37. 12/26’s 11.69 was lowest since 3/15/13!!! Recent high on 1/2 was 16.67! The recent range is 11.83-21.01!!! It peaked at 22.79 on 12/28/12…ytd the range is 11.05 (3/14) to 21.92 (6/24)!
Bonds were slightly weaker for a second day after rallying Friday on the weak payrolls. Rallying overnight however: 30 yr 3.74 +3/8 – high 3.97% on 12/31; the 10 yr 2.83% +3/8, recent high 3.03%! Long TIP 1.40% +7/16. The (record?) low of 0.36% was set on 4/5. The recent high yield: 1.64%! Libor update: 0.239% 3 mos,0.335%!!! 6 mos. BOTH just above NEW record lows 0.236%!!! and 0.334% respectively!). NOTE that the Fed Funds rate has averaged 0.08% since 5/22/13 and is currently 0.06%!, while the Fed is paying 0.25% to the banks on their excess reserves!!! No wonder they won’t make loans! Would you??? Foreign bond yields mostly lower, note Portugal and Greece however: Germany 1.72% -4; UK 2.83% -5! – recent high 3.03%!; France 2.42% -2; Italy 3.83% +1; Spain 3.72% -1; Portugal 5.06%!!! +4; Greece 8.00%!!! -3. Recent range 7.51%-12.57%. Japan: 0.65% -1. Yen doing better at 103.98, recent range 103.59-105.44 last week, low since 10/1/08!!!
Gold closed lower at $1238.70 -$4.30 on a parallel session, negating Friday’s gains. On Friday it did take out the 1/16 recent high of $1258.00, highest since 12/11/13. Jan. 2’s low was $1181.40 – A MULTI-DECADE LOW!!! Recent high is $1375.40 back on 9/19. Psych levels: $1200 sup; $1300 res, with major sup/res at the 40 day ($1232!) and the 50 day ($1241!). The 200 day is $1328. Overnight it is higher at $1247.90 +$9.20.
Crude closed strong…finally at $96.73 +$1.74!. The high was $96.89, highest since 1/2/14. 1/14’s low was worst since 5/2/13: $91.24! Note 12/27 was first time above $100 since 10/21! The record high of $114.83 was on 5/2/11, the low since on 10/4/11 is $74.95: $93.60 is the midpoint!!! Recent rally high and close are $110.70 and $110.53 respectively. It is still back above the 40/50 day m/a’s which are now major sup: 50 day m/a ($95.88!!!), 40 day (95.49!), crossed!!! and the 200 day ($98.95!!!) – 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 slightly higher at $97.03 +.21, with a high of $97.11 – wake me when it takes out the 200 day!
Global equity markets lower: UK -0.1% vs – vs +0.2% vs – vs +0.1%; France – vs +0.3% vs 0.4% vs – vs -0.1%; Germany -0.2% vs +0.2% vs 0.6% vs +0.1% vs -0.1%; Japan -0.8% vs +0.2% vs +1% vs -0.1% vs -0.4%; Hang Seng -1.5%!!! vs +0.2% vs +0.2% vs +0.5% vs +0.6%; Korea-1.2%! vs +0.3% vs +0.5% vs -0.7% vs +0.2%; India +0.2% vs +0.4% vs +0.2% vs -1%! vs -0.1% vs +1.2%! U.S. stock indices lower following 1k rise in jobless claims: DOW -65(range133!!!); SPX -5 (15); NDQ -5.5(22)
Some random thoughts:
…how you gonna catch a thief when the FDA criminally fined Amgen $762M for misusing a drug and then three corrupt senators (McConnell, Hatch, and Baucus), had the unmitigated gall to misuse their power and sneak a $500M gift to the perps in the January 2013 budget compromise…behind closed doors with no others knowing they ‘snuck’ it in! Worse, the fine was just levied…with a guilty plea too!!!…on Dec.15th 2013! Amgen had contributed to all of their campaigns and they too had the gall to do so again AFTER the fine! Despite a valiant attempt by an honest senator to strike it after the fact, he couldn’t even gain Tea Party support and it died. Pissed off? TB is…it’s not their money…it’s ours! Dammit!!!
Now let’s go back a year when 60 Minutes started an uproar over Congress and insider trading. Well, they got hounded and enacted a bill which was quietly amended right after passage to make exceptions to the rule. Not saying that happened with Amgen but look at this: the stock fell from $90.17 on 12/12/12 (fine and plea announced), to $82.08 on 01/18/13…on 1/28 it rallied for two days from $82.09 on 1/25 to a high of $87.89 on 1/29 …volume on 1/29 was 21.5 million shares vs an average of 2.93 million shares. TB checked and there was no report of the Senate action! Could these three ‘crooks’ have bought the shares themselves? Why else would the stock rally on a fine like that??? The fix was in! Still not upset? …pity you…pity me!
Just started reading Alan Blinder’ book on the financial crisis, After the Music Stopped, the title a play on Citi’s Chuck Prince’s statement, ‘as long as the music is playing you’ve got to get up and dance. We’re still dancing.” Prince was correct stating that in July 2007…but bank stocks had peaked and the market began to unravel by October and Chuck was still ‘skipping the light fantastic’(not 2008 – remember bank stocks peaked in early to mid-2007…the rout began in October, less than three months after his ill-fated statement (ill-advised too, as his disloyal Vice Chairman, Robert Rubin was still telling everyone in the bank to take more risk and be more like Goldman…then, when it all unraveled, he said he didn’t understand these derivatives…also he came to Citi in 1999 after leaving Treasury – part of the ‘committee to save the world’ – as Time dictated, and only months after he led the charge, instigated by Citi’s Sandy Weill to dismantle Glass-Steagall…was he rewarded for this valuable service? You decide. TB has!).
So far the book is very interesting…and a fact-finding and reporting mission, rather than focus and being mired in the details. Take a look!
Have a great day…if you have the stomach for it…-15 degrees here…windchill: -54.