6/13/13…Friday the 13th and no time to be superstitious!

Quote of the Day from the Friars Club Encyclopedia of Jokes: “I think I embarrassed the lady next to me on the plane. It was one of those flights that you sleep on. I sleep in the nude.”
– Johnny Dark

Bloomberg Quote of the Day: “Train yourself to let go of the things you fear to lose.”
– George Lucas…then prepare to lose them! TB

Bloomberg Top Stories:

*U.S. May Producer Prices Fall 0.2%; Core Rate Drops 0.1% – unexpected decline!
*Stocks in Europe Slide as Oil Advances on Iraq Crisis; Pound Strengthens
*Canada April Factory Sales Unexpectedly Fall on Reduced Energy Production
*Pound Appreciates to 19-Month High Against Euro After Carney Rate Comments
*Priceline to By Open Table at 46% Premium in Deal Valued at $2.6B – they have to be kidding!
*SEC Dark Pool Review Coms as Off-Exchange Trading Reaches Two Year High – 40.4%!!!
*Intel Sees First Sales Increase Since 2011 as Companies Upgrade Computers
*Carney Signals Early Rate Increase While Warning on Risk From Housing Debt – ?!?
*BNP Executive’s Departure Won’t Quell U.S. Demand for $10 Billion Penalty – to shareholders!
*Pound Appreciated to 19-Month High Against Euro After Carney Rate Comments
*Liberty’s Malone Said Valuing Formula One at $8 Billion in Talks for Sale – Open Table $2.6B?
*Basel Liquidity Rules Ignored as EU Commission Sides With Denmark on Bonds
*Scheinberg Hits Jackpot as Sale of PokerStars Site Makes Him Billionaire
*Valeant Headlines Puncturing Deal Strategy as Stock Slides – awww
*Supersonic Travel Readies for Return With Billionaires Bass Developing Jet
*Iraqi Militants Seize Two More Towns as Shiite Leader Issues Call to Arms – getting deadly!
*Hillary Clinton Popularity Drops to 52% in Poll as 2016 Advantage Shrinks
*Ukrainian Forces Battle Insurgents in Donetsk as Clinton Criticizes Putin
*Kids Duck Bullets as Columbia’s Presidential Candidates Debate Peace Deal

Thursday’s Market Summary:

Another boring day but volume did increase…readers however know that on a DOWN day that is not a good thing! All indices declined EXCEPT Dow Utilities +0.4%. This time the goat was Dow Transports -2%!!! vs -0.8%, while the rest were off form 0.7-0.9%! NYSE Financials were off for a second day at -0.4% vs -0.5%. BofA, the most active stock again fell 1.1% vs -2.1%.

Total NYSE Volume rose to a still well below average 3.03B shares vs 2.67B vs 2.69B vs 2.8B vs 2.84B vs 3.1B. Real trades on the floor of the NYSE rose but insignificantly to 621M shares vs 532M vs 557M vs 608M vs 640M. The 12-month average is a very weak 715M shares.
A/D’s were negative for the third time in six sessions: NYSE -1.4% vs -1.6x vs -1.4x vs +1.6x vs +2.9x; Nasdaq -1.8x vs -1.5x vs -1.2x vs +2.2x vs +2.5x. Breadth was worse: NYSE -2.2x vs -1.6x vs -1.01x vs +1.7x vs +2.3x; Nasdaq -2x vs +1.05x vs +1.3x vs +1.5x vs +2.4x. New 52 Week Highs were about even at 186 vs 193 vs 256 vs 515 vs 532 vs 436 – recent low 71!!! New Lows were slightly higher but remain very weak at 30 vs 25 vs 24 vs 25 vs 36 vs 66 vs 96 – recent range is 24-214.
S&P VIX almost came out of bullish territory, rising for a second day to 12.56 +.96!!! with a range of 11.71-12.81….13 is the key here! There have now been TWO closes above ‘12’ in 13 sessions – this is no time to be superstitious…wait…today is Friday the 13th part XXX!

Overnight markets:

Bonds closed strong…did they break the spell? 10 yr closed at 2.61% +3/8. 30 yr closed 3.41% +1 pt! The long TIP, which hit a low of 0.978% on 5/29, closed 1.13% +3/4. Overnight, weaker: 10’s 2.65% -1/8; 30’s 3.42% -3/16; and long TIP 1.13% -1/8. Cycle highs: 30 yr high was 3.97% on 12/31; the 10 yr recent high 3.03%! Long TIP was 1.64%. The (record?) low of 0.36% was set on 4/5/13.
Libor update: 0.232% 3 mos.; 0.326% 6 mos., both remain just off their record lows, set recently: 0.227% and 0.320% respectively! NOTE the Fed Funds rate has averaged 0.08% since 5/22/13 and is 0.07% -0.09%. Foreign bond yields mixed again: Germany 1.37% -1; UK 2.75% +4; France 1.73% -2; Italy 2.79% -2; Spain 2.66% -3; Portugal 3.34% +2; Greece, which took out the old lows is now 5.65% +1 after plunging nearly 70 basis points in THREE sessions!!! – Translate that from basis points to $!!! The high on selloff was 6.75%. Highly volatile!!! Range is now 5.42% to 12.57%. Japan: 0.59% –.

Gold closed strong but still not back to the m/a’s with a high of $1274.50 – highest since 5/27 – and closed at $1273.60 +$12.40. Last Tuesday’s $1240.20 was lowest since 1/31/14!!! It hit $1304.10 on 5/22 – the last time it saw $1300! It remains way below the 40/50/200 days and the psych support level of $1300 with first res at the 40 day $1281, then the 50 day $1286, and the 200 day $1292 – note convergence and thus formidable resistance! It has fared poorly since the ‘key reversal’ on 3/17, after printing the recent high of $1392.60, highest high since 9/4/13! Jan. 2’s low was $1181.40 – A MULTI-DECADE LOW!!! Overnight it is slightly weaker at $1272.80 -1.20….session high $127.60 – still highest since 5/27.

Crude took off like a rocket hitting $106.95 – highest since 9/19/13!!! – before settling at $106.53 +2.13. 6/5’s low of $101.60 was lowest since 5/16. 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. It is well above all three moving averages: 40 day ($102.35) then the 50 day ($102.41), and 200 day $100.17. The recent range is $85.61-$112.24 since March 1, 2012. Overnight it is slightly higher at $106.93 +.40 but with another new high of $107.68 – still highest since 919/13! That was the big dive down!

European equity markets weak!!! Asia widely mixed: UK -1.1%!!! vs +0.2% vs -0.5% vs -0.3% vs +0.3%; France -0.8% vs +0.2% vs -0.8% vs +0.1% vs -0.1%; Germany -0.8% vs +0.1% vs -0.9% vs +0.2% vs +0.1%; Japan +0.8% vs -0.6% vs +0.5% vs -0.9% vs +0.3%; Hang Seng +0.6% vs -0.4% vs -0.3% vs +0.9% vs +0.7%; Korea -1%!!! vs -0.2% vs +0.1% vs +1.1%! vs -0.3%; India -1.4%!!! vs +0.4% vs -0.4% vs – vs +0.7% vs +1.5%; U.S. Stock Index Futures little changed: DOW -11 (range 63); SPX -1.10 (7); NDQ +.75 (12).
Some random thoughts:

…the world’s a mess and we are part of it…perhaps however with the defeat of Eric Cantor in the GOP primary things will get better and our Congress will be less dysfunctional…one can hope! Note that this is the first time ANY House Majority Leader has been defeated in a primary!

Yesterday, right in the middle of an SEC review of ‘Dark Pools’, trades executed on the NYSE floor were just 20% of the total. But get this: 40.4% of the total volume was Dark Pools! That is a record!!! Dark Pools, if you didn’t read Michael Lewis’ book, Flash Boys, are where Goldman and other dealers use client orders any way they wish and execute where they wish so the client never knows if they got a good execution or not. Worse, even when the client specifies which exchange the trade is to be executed on, they often ignore it. SEC had better do something – fast!
But wait…didn’t Goldman say they were opposed to ‘flash trading’ – yes they did…but not to their credit as the book points out: due to their paranoid concern over their computer programs they never were any good at flash trading…but Black Pools they excel at! Hypocrites!!!

Eric Holder…remember when he said he lost sleep over whether to prosecute bank executives over the financial crisis fearing how it might affect the company’s shareholders? Poor Eric…not only was that outside his job description but by failing to prosecute and hold them responsible, all those record fines have been paid by the same shareholders! That simply does not compute, and even CEO’s who left got a nice ‘farewell handshake’ in the millions. BNP, facing a huge $10 billion U.S. fine, had its CEO resign, hoping to mitigate the fine…no deal! Can’t wait to see how much he takes home with him. Thank you for helping us Eric…now get the hell out!!!

Looks like a beautiful day in Minnesota…66 degrees and rising…not a cloud in the sky…and TB doesn’t feel like writing any more…but should he dare to go outside on Friday the 13th ? Hmmm

Have a wonderful, fun weekend…and Happy Fathers Day to all you mothers! Friars Club had a joke that is kind of appropriate…in an inappropriate way: “I remember a lot of things before I was even born. I remember going to a picnic with my father and coming home with my mother.” – Foster Brooks…the old drunk…and very funny…think about the quote for a while…TB



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