Quote of the Day from the Friars Club Encyclopedia of Jokes: “A good listener is usually thinking about something else.” – Kin Hubbard
Bloomberg Quote of the Day: “Outside show is a poor substitute for inner worth.” – Aesop
This week’s economic calendar is packed with important indicators. The highlight of the week will be the June ISM Manufacturing Survey (Tuesday), June ISM Non-manufacturing Survey and June Employment Situation report (Thursday). We will also get June Chicago PMI and June Dallas Fed Manufacturing (Monday), May Construction Spending and June Motor Vehicle Sales (Tuesday), June ADP Employment and May Factory Orders (Wednesday) and May International Trade (Thursday). Courtesy of Economic Advisory Service.
Bloomberg Top Stories:
*Argentina Default Countdown Starts After $539 Million Bond Payment Blocked – !!!
*BNP Paribas Dollar-Clearing Ban Said to Start in 2015 as Guilty Plea Looms – no jail time!
*Emerging-Market Stocks Advance as European Shares Rebound; Crude Oil Falls
*How a Memphis Firm Decoded bonds Secrets Mystifying Wall Street’s Brightest
*PPG to Step In Where Shewin Failed With $2.3 Billion Accord to Buy Comex
*Canadian Economic Expansion Rate of 0.1% for April Is Less Than Estimated
*Puerto Rico Utility’s Default Plan May Spread Pain Throughout Muni Market
*Fields Sees Lincoln Luxury Money-Maker in MKC Where Mulally Demurred
*They Are Dying at Their Desks in China as Epidemic of Stress Proves Fatal
*Islamist Militants Declare Caliphate in Conquered Region as Iraq Fights On
*Retired Top Chinese General Xu Caihou Is Expelled From Party over Bribes – No!
*Obama Poised to Nominate Former P&G CEO McDonald to Head Veterans Affairs
Friday’s Market Summary:
A dull session BUT on high volume of 4.25B shares vs 2.78B. Real trades on the NYSE floor also surged to 1.49B shares…but likely due to today’s quarterend and lack of players at the beginning of the July 4th week! Caution! Note also that the volume at 1pm was just 520M shares…that means nearly 900M shares at the bell!!! Looks more and more like a casino!
An ‘up’ session but ranging from +0.7% on the Russell 2000 to FLAT on the Dow – 5 point gain! All the others were up 0.2-0.4% It still hasn’t even retraced 50% of Tuesday’s loss!!! DIW!
Note we will get payrolls report on THURSDAY due to the fourth of July holiday!
Total NYSE Volume was strong at 4.25B shares!!! vs a weak 2.78B shares vs 3.1B vs 3.06B shares, almost the same as the 4.22B on the prior Friday’s options expiration! Real NYSE Volume soared to a lofty 1.49B shares – compare to options expiry’s 1.722B shares – from a very weak 592M shares (with included 100M AFTER the bell!) vs 653M vs 648M while the 12-month average edged up to a still very weak 711M! Since 4/30 the average volume has been just 706M shares ranging from 531M to 1.72B.
A/D’s were positive: NYSE +2x vs +1.1x vs +2.2x vs -1.7x vs -1.01x; Nasdaq +1.7x vs -1.1x vs +1.7x vs -2.4x vs -1.3x. Breadth was similar: NYSE +1.3x vs +1.02x vs +2.2x vs -3.5x! vs +1.05x; Nasdaq +1.5x vs +1.1x vs +2.4x vs -2.3x vs +1.06x. Imagine that on huge volume! Ignore. New 52 Week Highs rose to 301 vs 221 vs 214 vs 288 vs 369 vs 469 – recent range 71-515!!! New Lows dipped to a weak 42 vs 51 vs 64 vs 52 vs 42 vs 60 vs 42 vs 40 vs 38 – recent range is 24-214.
S&P VIX was lower closing at 11.26 -.37 and while the bottom of the range moved down to 11.19, the top held at 12.04 with ‘12’ prints at the top of the range for FIVE straight sessions – range had been stretching higher for five straight sessions after bottoming at 10.34 a week ago on options expiration!
Bonds closed slightly weaker but have gained it back overnight: 10 yr closed at 2.53% -3/16. 30 yr closed 3.37% -3/16. The long TIP, which hit a low of 0.978% on 5/29, closed 1.00%% -3/16/16. Overnight: 10’s 2.52% +1/8; 30’s 3.35% +5/16; and long TIP 0.98%!!! +7/16. 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: 0.231% 3 mos.; 0.327% 6 mos., both remain near their record lows, set recently: 0.222% and 0.320% respectively! NOTE the Fed Funds rate has averaged 0.09% since 5/22/13 BUT (in advance of quarterend?) it is 0.01-0.05%!!! after being at 0.09%-0.10% for weeks! Foreign bond yields little changed except PIIGS which are higher: Germany 1.24% -2; UK 2.64% +1; France 1.70% -1; Italy 2.84% +1; Spain 2.66% +3; Portugal 3.63% +9 – 20bp’s in 2 days!!! Greece, which closed at 5.76% Thursday is now 5.85% +3. The recent high on selloff was 6.75%. Highly volatile!!! Recent range 5.42% to 12.57%. Japan: 0.56% –.
Gold closed slightly higher in a nothing session at $1320.00 +$3.00 after trading up to $1325.60 Tuesday – highest since 4/15 when it swooned. This is the 7th straight close above $1300 since 4/14! 7 days ago the high was $1285.10 – highest since 5/27 when it began its devastating plunge. 6/9’s $1240.20 was lowest since 1/31/14!!! It remains above all three key moving averages which are very tight: 200 day $1288, then the 50 day $1285, and the 40 day $1284 – key is the psychological $1300 level 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 is weaker at $1312.10 -$7.90 with a low of $13.11.20. Since a week ago’s $41 rally it has done nothing but consolidate.
Crude also had a quiet session closing at $105.74 -.10 (3rd close below $106), after trading down to $105.03 Thursday, lowest since 6/12! A week ago’s run to $107.73 – highest since 9/19/13, a huge down session – has left it in limbo. 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 remains well above all three moving averages: 40 day $103.52, 50 day $103.14, then the 200 day $100.06. The recent range is $85.61-$112.24 since March 1, 2012. Overnight it is weaker at $105.26 -.48 in another narrow range session – caution on a break below $105!
Global equity markets little changed and mixed; India strong: UK -0.1% vs +0.1% vs — vs -0.5% vs -0.1%; France -0.3% vs – vs +0.1% vs -0.7% vs +0.1%; Germany +0.2% vs +0.1% vs – vs -0.4% vs –; Japan +0.4% vs -1.4% vs +0.3% vs -0.7% vs +0.1%; Hang Seng -0.1% vs +1.5% vs -0.1% vs +0.3% vs -1.7%; Korea +0.7% vs -0.3% vs +0.7% vs -0.6% vs +1%; India +1.3%! vs +0.2% vs -1%! vs -0.2% vs +1.4% vs -0.3%; U.S. Stock Index Futures little changed: DOW -5 (range 21); SPX -0.20 (5!); NDQ +2.75 (7!).
Some random thoughts:
…just a short comment for a holiday shortened week: when are people going to get it?…that Rumsfeld and Cheney put us in this mess in the Middle East and make no apologies for it – none! In fact Dick Cheney continues to pour gasoline on the fire by trying to get us more involved everywhere. He lit the torch with an all too willing George W. Bush who according to investigative reporter James Risen (who the government is after for not revealing his source – although they know who in the administration leaked it) – His book State of War: The Secret History of the CIA and the Bush Administration is shocking in the Bush 43 administrations failure to confirm info from a CIA that lacked any historical perspective and had inexperienced people putting data – as it came in without verification!
TB only became aware of this listening to another investigative reporter Charles Lewis on Moyers and Company. His book to be released this month deals in the veil of secrecy and spying that began with the Bush administration and has been blindly carried on by the Obama team. It is a sickening amount of information – good luck, America…especially while the neo-cons continue to influence the GOP. What fools we (they) are! If insanity is doing the same thing over and over with the same results, then we are an insane people that continues to listen to the same people who have been repeatedly wrong since 9/11 – and what have we got to show for it? Loss of American lives and runaway spending on war efforst. Beam me up, Scotty, no signs of intelligence!
Have a great four day week!