4/17/14…high frequency jinx create faux rally…payback tomorrow?

Quote of the Day from the Friars Club Encyclopedia of Jokes: “Never go to a doctor whose plants have died.” – Erma Bombeck

Bloomberg Quote of the Day: “Passion, though a bad regulator, is a powerful spring.” – Ralph Waldo Emerson…TB is reading ‘Last Call’ on Prohibition and that power is incredible.

TB Saiz: The old saying about Minnesota is wrong. It should be: we have four seasons: Winter, Winter, AND WINTER road repair! The last is the worst…trust me!!! Aarrgghh!!

Bloomberg Top Stories:

*First-Time Jobless Claims in U.S. Hover Near the Lowest Level Since 2007 – so pay ‘em!
*U.S. Stock-Index Futures Rise Amid Earning Results, Jobless Report…oh? See below!
*Goldman Sachs Beats Analysts’ Estimates on Increase in Investment Banking – nothing new!
*Morgan Stanley Exceeds Estimates on Surprise Jump in Fixed Income Revenue – Huh?
*High-Frequency Fightback Starts with Foreign Exchange Trading Random Pause – get ‘em!
*IBM Sales Drop Amid Shift to Cloud Weight on CEO Rometty’s Profit Goal
*Activist U.S. Fund Demands Board ouster at Anworth Family Mortgage REIT – TB met the father in London years ago, who turned over an un-innovative fund to his son…nothing to see here!
*GM Move to Freeze Ignition Suits Seen Cutting Customer Payouts by Billions – stop ‘em!
*Fed Repo Dominance Rises as Reverse Facility Caps Rates – huh?
*Detroit Seeks Debt-Reduction Plan Votes With ‘Divide and Conquer’ Strategy – worked for GOP
*Stop, Start, Start, Stop Is One Firm’s Answer to HFT Threat – beat them at their game!!!
*Blacklisted Putin Bank Trail Runs From Soviet Cash to Billionaire Buddies – the man is sick!!!
*Forcing Russia Out of Financial Markets Seen as Best U.S. Tool on Ukraine Crisis
*Korean Families Confront Park With 287 People Missing After Ferry Disaster
*Putin Vows to Fight for Compatriots in Ukraine as Officials Meet in Geneva – just like Hitler and the NATO response is similar! This is sick and getting sicker! Last time we got WWII!!!
*Divers at Blue Bow of Capsized Korean Ferry Stymied by Encroaching Cold – a tragedy!
*Keystone Foes Winning Fight for Celebrities That Backers Say Won’t Matter – probably right

Wednesday’s Market Summary:

Setting up for a ‘rock and roll’ options expiration this Friday. Why? You ask…because yesterday’s rally was back to low volume of 3.14B shares vs 3.72B Tuesday, and actual trades on the NYSE plunged to 675M shares, lowest in TEN sessions from 746M (12 mo. ave. is 726M shares! …you recall Tuesday, right? The one that was up about one-half percent but was led by Dow Utilities +1.3% vs +0.6% and up 11% ytd!!! Well, it was the weakest yesterday BUT still up 0.8% which makes it up 11.9% ytd and now 3.1% mtd!!! The only other index in the black for the month is Dow Transports +0.2% while they are up just 2.6% and every other closely watched index is RED. Not as in ‘red state’ by the way.
Back to yesterday, the winner was Dow Transports +1.7%! followed by the two Nasdaqs +1.3%, then the S&P 500 and Russell 2000 +1.1%, while the Dow rose 1%. Again, anyone who tells you they understand this market is either a damned fool or a liar…you choose.
NYSE Financials rose 1% vs +0.4% vs +0.6% vs -1% vs -2.1%, with Brokers up 2%!!! vs +0.8% vs +0.8% vs -2% vs -2.8%!!!; KBW Banks +0.3% vs +0.8% vs +0.7% vs -1.1% vs -3%!!! Nasdaq Banks +0.5% vs +0.2% vs +0.3% vs -0.7% vs -2.5%!!! BofA most active: -1.6% vs +1.9% vs +1.5% vs -2.2%! vs -2.9%!!! vs +1.1%. Volatile? Closed $16.13 -.26 – session low was $15.78 and it has been below $16 3 of the last 4 sessions, one of them the lowest since 12/31. No other active financials Citi off slightly, the rest up modestly. JPM +0.8%, USB -1.3%.
Advance/Declines were positive but not much meaning given the low volume…the NYSE was +3.8% vs +1.6x vs +1.9x vs -2.5x vs -3.4x! vs +2.7% vs +2.1x vs -2.1x vs -1.9x, Nasdaq +2.5x vs -1.1x vs +1.1x vs -3.8x! vs -6.3x!!! Breadth was similar: NYSE +3.3x vs +1.7x vs +2.9x vs -4.2x! vs -7.4x!!! Nasdaq +4.3x! vs +1.3x vs +1.3x vs -5x; Nasdaq Advance/Declines were +2.4:1 vs -1.1:1 vs +1.1:1! vs +4.6:1 vs 4.3:1! vs -7.8:1!!! on the Composite and by +2.5:1 vs +1.5:1 vs +4.6:1 vs –44:1! vs -100:1!!! on the 100!!!
New 52 Week Highs rose to a respectable 144 from a weak 88 vs 89 vs 42 vs 97 vs 138 vs 60 vs 56 vs 268 vs 273 vs 327, while New Lows plunged to 49 from 198!!! vs 135 vs 151! vs 91 – 16 is the cycle low . Lastly, Volatility (VIX) declined for a third day to a still slightly elevated 14.18 -1.43! while the range remained high at 14.05-15.27 vs 15.47-17.50 vs 16.10-17.40!!! Can;t wait for Friday!!! Last Friday’s range was 15.89-17.85! – highest since 3/14! The low of 12.60 just 9 days ago and lowest since Jan. 22! Bears watching…roar!

Overnight Comments:

Bonds: closed slightly higher and haven’t been down in five sessions running– just 10 days after the 10’s replaced the 3/3 high of 2.79% with a 2.80%. (Close: 10 yr 2.63% +1/16; 30 yr 3.45% +3/16; TIP 1.15% +5/8). Overnight giving back all of those gains and a tad more: 10’s 2.65% -3/16; 30’s 3.46% -1/4; TIP 1.16% -3/8 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: 0.226% 3 mos.; 0.320%! 6 mos., both back at their record lows! 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 little changed ex-Greece, which is sharply lower: Germany 1.49% +1; UK 2.64% +1, – recent high 3.03%! France 1.97% +2; Italy 3.11% +2; Spain 3.08% +2; Portugal 3.69% -3; Greece 5.93% -15 vs 6.08% vs 6.29%!!! vs 6.15%!!! vs 5.77%!!!. Range is 5.77% to 12.57%. Japan: 0.59% -1.

Gold closed almost even after trading weak after falling to $1284.40 (creating a double bottom from 4/4!) AND after trading to $1324.90 – highest since 3/24 just three days ago. Again, it barely made it back to $1300 and closed at $1303.50 +$3.20. 11 days ago it traded down to $1277.40, lowest since 2/10. Now just a hair above 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 $66 in 23 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 $1301 and res at the 50 day, $1318, then the 40 day, $1325. Major support at $1284.40 the double bottom from 4/4. Overnight little changed in an INSIDE session: $1303.20 -30.

Crude closed up a penny at $103.76 a day after touching $102.91 and closed at $103.76 +.01 – the day before it tradedj up to $104.99, 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 ($101.36), then the 50 day ($101.12), followed by the 200 day at $100.81. The recent range is $85.61-$112.24 since March 1, 2012. Overnight it is about even at $103.79 +.03 and like Gold with an INSIDE session.

Global equity markets slightly higher, India STRONG; Korea has barely budged for four days: UK +0.1% vs +0.3% vs -0.1% vs – vs -1.1%! France +0.2% vs +0.8% vs +0.2% vs – vs -1.3%! Germany – vs +0.8% vs -0.5% vs – vs -1.7%! Japan –vs +3%!!! vs +0.6% vs -0.4% vs -2.4%!!! Hang Seng +0.3% vs +0.1% vs -1.6%! vs +0.2% vs -0.8% vs +1.5%!! vs +1.1%! vs +1%! Korea – vs – vs -0.2% vs – vs -0.6%; India +1.6%! vs -0.9% vs-0.6% vs closed vs -0.4%. U.S. equity futures slightly higher…are positions squared for Friday?…but look at the DOW: +8, at low -50! (range 60!?!); SPX +1.90 (8!); NDQ +10.50 (20). Yesterday they gapped up at open!?!

Spring is over and back to WINTER in Minnesota…4-8” of snow last night…and back to a Winter Wonderland…yeah, sure, ya betcha!

Have a fine day!

TB

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1 Comment »

  1. Yarnman said

    TB–Isn’t it fun to see crocuses blooming brightly in a bed of fresh, white snow? Kind of takes your mind off HFT, doesn’t it!–Yarnman

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