4/16/14…the morning after the night before (taxes)

Quote of the Day from the Friars Club Encyclopedia of Jokes: “Of the twp basic certainties, death and taxes, death is preferable. At least you can’t be called in six months for an audit.” Bill Vaughn
Would have used that yesterday but didn’t want to stifle any of your creative thinking. TB

Bloomberg Quote of the Day: “Happiness is part of who we are. Joy is the feeling.” – Tony DeLiso
Yeah, I hear you but where is the joy? Wealth brings happiness and contentment. TB

Bloomberg Top Stories:

*Bank of America Posts Quarterly Loss After Settling Mortgage-Bond Crisis – more to follow?
*Stocks Rise on Earnings as Oil Gains; Pound Strengthens on Falling Jobless – but BofA???
*U.K. Unemployment Drops to Five-Year Low as Rebound Spurs Rate Speculation
*Credit Suisse First-Quarter Profit Falls 34% as Investment Banking Slides – Rally???
*Mt. Gox Drops Revival Plan as Karpeles Cedes Control of Bitcoin Exchange – Buttcoin!
*Europe’s Periphery Emerges as Haven as Bonds Rise Amid Clashes in Ukraine
*Samsung Attacks Apple Smartphone Patent in $2 Billion Case as Not So Novel – hmmm!
*Long Bonds Vanish as 11% Benchmark Rates Proving Deterrent in Brazil
*Secret of Tokyo Bitcoin Miner’s Success Lies in Cheap Austrian Electricity – thought it was greed? Hey, Bitcoin buyers…want to buy my Tulip bulbs? Could jump in value!
*Korea Ferry Disaster Leaves 292 Missing Including Students as Three Killed – tragic 
*Ukraine Says Russia Exporting ‘Terrorism’ Amid Military Offensive in East – this we know!
*Billionaire Hedge Fund Leaders singer, Klarman, Join Ricketts’s Super-PAC – can they overcome Michael Lewis and stop the SEC and Justice Dept.? History says YES!!!

Tuesday’s Market Summary:

Another kinda sorta rally…but what does it say when the leader is once again Dow Utilities +1.3% vs +0.6% and now up 11%!!! Ytd!!! Anyone who tells you they understand this market is either a damned fool or a liar…you choose. The Dow? Up just 0.6% and the S&P +0.7% while the two Nasdaq’s and the Russell 2000 were up just 0.4% (along with NYSE Financials). The other respectable showing was Dow Transports +0.9% – time to take a vacation…at least until next week! Total NYSE Volume roared back to an above average 3.72B shares from a weak 3.1B shares vs 3.73B (down day) vs 3.73B vs 3.3B vs 3.7B vs 3.77B vs 3.6B vs 3.03B shares. REAL NYSE Volume also rose to a respectable 746M shares from a weak 692M shares from a strong 815M vs 771M vs 703M vs 836M vs 781M vs 661M vs 653M vs 724M (12 mo. ave!) vs 847M vs 639M –leaving all those numbers there in hopes it will sink in.

NYSE Financials rose 0.4% vs +0.6% vs -1% vs -2.1%, with Brokers up 0.8% vs +0.8% vs -2% vs -2.8%!!! vs +1.4% vs +0.6% vs -2.1%; KBW Banks +0.8% vs +0.7% vs -1.1% vs -3%!!! +0.5% vs flat vs -1.6%; Nasdaq Banks +0.2% vs +0.3% vs -0.7% vs -2.5%!!! vs -0.1% vs +0.1% vs -0.7%. BofA numero uno active: +1.9% vs +1.5% vs -2.2%! vs -2.9%!!! vs +1.1%. Closed $16.30 +.30 – back from the lowest since 12/31. Can it hold sweet sixteen? Citi also a most active for a second day, up 1% vs +4.4%.

Advance/Declines were mixed but nearly even – no confirmation of a rally even thinking about happening but ahead of options expiry, who knows? …the NYSE was +1.6x vs +1.9x vs -2.5x vs -3.4x! vs +2.7% vs +2.1x vs -2.1x vs -1.9x, Nasdaq -1.1x vs +1.1x vs -3.8x! vs -6.3x!!! vs +2.9% vs +1.9x vs -3.2x vs -4.9x! Breadth was sort of positive” NYSE +1.7x vs +2.9x vs -4.2x! vs -7.4x!!! vs +2.7% vs +2.2x vs -4.4x!!! vs -1.9x; Nasdaq +1.3x vs +1.3x vs -5x! vs -14.5%!!! vs +6.3%! vs +2.2x vs -3.1x vs -7.3x!!! Still weak! Nasdaq Advance/Declines were -1.1:1! vs +1.1:1! vs +4.6:1 vs 4.3:1! vs -7.8:1!!! vs +3:1 vs +2.1 vs -3.4:1 vs -6:1 on the Composite and by +1.5:1 vs +4.6:1 vs –44:1! vs -100:1!!! vs +7.4:1! vs +3:1 vs -4:1 vs -97:4 on the 100!!! Note the New 52 Week Highs were steady at a still-weak 88 vs 89 vs 42 vs 97 vs 138 vs 60 vs 56 vs 268 vs 273 vs 327 vs 306 vs 226 vs 110, while New Lows surged to 198!!! vs 135 from a high 151! vs 91 vs 37vs 56 vs 107 vs 71 vs 31 vs 18 – within 2 of their cycle low . Lastly, Volatility (VIX) declined for a second day to 15.61 -.50…still high and the range was high again 15.47-17.50 compare to Monday’s 16.10-17.40!!! Beware of options expiry!!! Friday’s range was 15.89-17.85! – highest since 3/14! The low of 12.60 just 8 days ago was lowest since Jan. 22!

Overnight Comments:

Bonds: closed modestly higher and haven’t been down in four sessions now – just 9 days after the 10’s replaced the 3/3 high of 2.79% with a 2.80% BUT, like a bad golfer, no follow-through! (Close: 10 yr 2.20% -1/16; 30 yr 3.49% –; TIP 1.19% +1/16). WEAKER overnight and giving back much of the gains: 10’s 2.64% -1/8; 30’s 3.48% -3/8; TIP 1.20% -1/2 Recent highs: 30 yr high was 3.97% on 12/31; the 10 yr recent high 3.03%! Long TIP recent high was 1.64% The (record?) low of 0.36% was set on 4/5/13. Libor update: 0.228% 3 mos.; 0.321%! 6 mos., both just above their record lows which were in the last month. The Fed is driving this by continuing to pay 0.25% on their excess reserves – why lend??? Fed has no choice in financing the securities they bought in the QE’s! NOTE the Fed Funds rate has averaged 0.08% since 5/22/13 and is 0.08% -0.09%. Foreign bond yields rallied late yesterday and are mixed o/n and little changed ex-Portugal which is sharply lower: Germany 1.49% +2; UK 2.64% +4, – recent high 3.03%! France 1.96% +1; Italy 3.10% -1; Spain 3.07% -2; Portugal 3.74% -10! Greece 6.01% -3 vs 6.29%!!! vs 6.15%!!! vs 5.77%!!!. Range is 5.77% to 12.57%. Japan: 0.60% +1.

Gold closed weak and traded down to $1284.40 (creating a double bottom from 4/4!) after trading to $1324.90 – highest since 3/24 just three days ago. It barely made it back to $1300 and closed at $1300.30 -$27.20!!! Ten days ago it traded down to $1277.40, lowest since 2/10. Now right on the 200 day and the psych support level but below the 50 and 40 day. 3/4 was the 1st close above the 200 day and $1300 in eight sessions! – now off $69 in 22 sessions following the reversal on 3/17 after printing new recent high of $1392.60, highest high since 9/4/13 – that ended in an outside day and nearly a negative key reversal! Jan. 2’s low was $1181.40 – A MULTI-DECADE LOW!!! Psych level: $1300 sup, with technical support at the 200 day $1300 and res at the 50 day, $1317, then the 40 day, $1326. Major support at $1284.40 the double bottom from 4/4. Overnight little change: $1303.10 +$2.80 with a session low of $1293.50…hmmm.

Crude declined to $102.91 before coming back to close at $103.75 -.30 – just two days ago it traded to $104.55 highest since March 4. On April Fool’s Day it finally broke above the 40/50 and 200 day m/a’s, trading up to $102.24. 3/2’s session low was $97.37, lowest since 2/4! 1/14’s low was worst since 5/2/13: $91.24! 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. First SUPPORT is the 40 day ($101.38), then the 50 day ($101.14), followed by the 200 day at $100.82. The recent range is $85.61-$112.24 since March 1, 2012. Overnight it is higher at $104.79 +$1.04 with a session high of $104.99.

Global equity markets modestly higher led by a BIG rally in Japan; India weak: UK +0.3% vs -0.1% vs – vs -1.1%! vs +0.3%; France +0.8% vs +0.2% vs – vs -1.3%! vs +0.1%; Germany +0.8% vs -0.5% vs – vs -1.7%! vs +0.3%; Japan +3%!!! vs +0.6% vs -0.4% vs -2.4%!!! vs – vs -2.1%!!! vs -1.4%! vs -1.7%! Hang Seng +0.1% vs -1.6%! vs +0.2% vs -0.8% vs +1.5%!! vs +1.1%! vs +1%! Korea – vs -0.2% vs – vs -0.6% vs +0.5%; India -0.9% vs-0.6% vs closed vs -0.4% vs +0.1% vs +1.6%. U.S. equity futures higher in another narrow range: DOW +73 (range 70); SPX +9.20! (9!); NDQ +20.25 (17!!!). How can gains be higher than range? Gap up at open.

Spring is again ‘iffy’ in Minnesota…supposed to be snow and rain today and possibly four days!

Have a fine day!

TB

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