11/24/14…we have a mandate~!

Quote of the Day from the Friars Club Encyclopedia of Jokes: “Conscience is the inner voice that warns us that someone may be look.” – Carolyn Wells

 

Bloomberg Quote of the Day: “What is right to be done cannot be done too soon.”

– Jane Austen

Bloomberg Top Stories:

*European Stocks Strengthen with Spanish, Italian Bonds as Ruble Advances – strange?

*The $400B Bond Mismatch That Kept Bear Market at Bay Seen Enduring – shortage

*Hagel Stepping Down as U.S. Defense Secretary Under Pressure – sad, really…he tried…hmmm…what if the idiot, McConnell holds up any nominations?

*Stryker Is Said to Be Weighing a Bid for Smith & Nephew as Standstill Ends

*Snowstorm Will Hit Much of Northeastern U.S. This Weekend With NYC Spared

*BT in Talks to Buy O2 From Telefonica, Is Said to Discuss Purchase of EE – o ge?

*Iran, World Powers Agree (sic) to Extend Nuclear Talks to July 1 as Gaps Remain –ugh

*UPS Teaches 95,000 Holiday Recruits to Fend Off Dogs, Dodge New York Taxis

*OPEC’s Easy-Decision Days Are Seen as Over by Former Qatari Oil Minister

*Ukraine Decision on Joining NATO to Be Made by Referendum, President Says

*Brazil Corruption Probe Threatens Petrobras’s Record Debt Financing Plan – !!!

*Rand Paul Shows Early Strength for Presidential Bid in New Hampshire Poll

*Beef the New Red Bull as Hong Kong Finance Crowd Embraces Hamburger Craze

*Profit on 700% Loans Flows Through Indian Tribe to medly Opportunity fund

This week’s economic calendar is full of important indicators. The highlight of the week will be the Q3 GDP 2nd Estimate (Tuesday) and October Personal Income (Wednesday). We will also get November Dallas Fed Manufacturing (Monday), September Case-Shiller Home Prices, November Consumer Confidence, November Richmond Fed Manufacturing (Tuesday), October Durable Goods Orders, November Chicago PMI, November Consumer Sentiment Final and October New Home Sales (Wednesday). Courtesy of Economic Advisory Service

Friday’s Market Summary

If you stuck around Friday, you must have felt like you were on ‘Mr. Toad’s Wild Ride’ (that, by the way was a ‘D’ ticket ride at Disneyland when it first opened. First, right out of the chute the Dow popped 217 points to the session high of 17894! Only an opening gap of 2 points in that…which produced a new record high for the Dow. The rest of the day was spent retracing to a low of 17763 (+41) – not by coincidence at expiration (10:30am EST), and then gyrating higher to close up 91…still a record high, but…

But when you look at the final results, you have to wonder ‘what was the big deal?’ Fact is, it wasn’t other than the new record high ( for the S&P 500 too: 2063.50). Both were up 0.5% along with Dow Transports, but look at the rest: BOTH Nasdaq’s up just 0.2% (reflected in A/D’s and Breadth which were strong for NYSE stocks), while the Russell 2000 closed up just 0.1%?!? Compare to Dow Utilities up 0.4%. Faux rally? Dunno.

New 542 week highs doubled to 359 while new lows fell back to 66. The S&P VIX wa as high as 13.80, a day after topping at 15.74! It closed below ‘13’ finally, at 12.90 -.68, back on the cusp of being neutral again. Volume was high…natch. Digest that!

Total NYSE Volume rose to 3.9B shares, highest since 11/4, vs 3.1B, lowest in more than a week, vs 3.4B vs 3.41B vs 3.13B. Average volume since 9/30 is about 3.6B shares and slipping, or about 600M more than the 12-month average. Shares traded on the NYSE floor – affectionately referred to by TB as REAL volume also rose to a strong 1.04B shares highest since 10/31 (obviously expiration related!),from 662M, lowest in 8 sessions, vs 738M vs 731M vs 694M. For comparison purposes, for the prior 12 months it is a historically weak 712M shares…but since 10/1: 819B shares and slipping – including that HUGE 1.22B share day – highest since 9/19, followed by two more 1B plus days leading to options expiry!. The lowest was 10/6’s 696M share session. April 30 – September 30 we had just SEVEN 800M shares…since 10/1: 16, and FIVE 900M+ days.

A/D’s were strong on the Big Board but minimal on Nasdaq: NYSE: +2x vs +1.9x vs -1.6x vs +1.6x vs -1.3x; Nasdaq +1.1x? vs -2.6x! vs +1.5x vs -1.9x vs -1.1x. Breadth was even better for NYSE: NYSE +3.7x!?! vs +2.1x vs -1.6x vs +2x vs 1:1; Nasdaq +1.3x? vs +2.8x! vs -2.2x! vs +2x vs -1.7x. New 52 Week Highs doubled to 359 vs 173 vs 135 vs 304 vs 242 – their range for the year is 39-612!!! New Lows plunged to a very weak 66 vs 104 vs 141 vs 117 vs 115. The 2014 range is 24-1043!!! S&P VIX was tamed with a high of 13.80, a day after hitting a very bearish 15.74, highest since 11/4! It closed at the session low (for a 2nd day) of 12.90 -.68. This is its 19th sub-15 close since peaking on 10/15. Heading back toward those bearish extremes that had a high of 31.06 (highest since 11/28/11!!!)? You decide. The average of the past 12 months is 14.00, with a low of 10.28!…high close of 26.25 on 10/15/14! Follow the bouncing ball…

U.S. bond market also closed higher led by the long TIP. The recent 12 month low yields (10’s 2.09%; 30’s 2.87%; and long TIP 0.83%), 10’s closed at 2.31% +1/8; 30’s 3.02% +3/4, and the long TIP 0.99%! +1-1/4! Overnight back to weak: 10’s 2.33% -3/16; 30’s 3.04% -7/16; and long TIP 1.01% -9/16.  

Libor update: 0.233% 3 mos.; 0.327% 6 mos., both steady and just above new record lows! The Fed Funds rate has averaged 0.09% and is steady at 0.09-0.10%. T-Bills: 0.3%, one-month, 0.00%! 3 mos, 0.12% one year.

Foreign bond yields mixed; PIIGS lower AND they plunged further late Friday??? (Benchmark is 10yr): Germany 0.78% +1; UK 2.06% +1; France 1.11% –; Italy 2.17% -4; Spain 1.96% -4; Portugal 2.94% -4; Greece 7.71%!!! -2 – like buttah! 10/16’s close was 8.54%! – cycle low: 5.42%; Crisis high: 12.57%. Japan: 0.45% –.

Gold closed slightly higher but unable to hold the session high of $1208.20 – higest since 10/30 and first time above the 40/50 day since 10/21!, before closing at $1198.40 +$6.90…still hanging on to 11/14’s ‘positive key reversal’. 11/7’s low was $1130.40, a new 12-month low!). The last 18 sessions have had prints below $1200 – first time since 12/31/13 Last close above $1300 was on 8/15. 7/17’s session high was $1346.60, highest since March 19th!!! Res/SUP is at $1200 (psychological), then the 40 day at $1204, the 50 day $1208, then the 200 day at $1277. The 12-month high is $1392.60 on 3/17, highest high since 9/4/13. $1130.40. 11/7’s low was $1130.40! Overnight, range is $1204.50-$1192.80 (only the 3rd time over $1200 since 10/31), and currently $1198.30 -.10.. Silver traded up $16.66, highest since 10/30, and back from 11/5’s low of $15.12, more than a five year low.

Crude also closed slightly higher at $76.51 +.66, but was unable to hold the session high of $77.83 (low wsa$75.62!). Six days ago it set a new recent low of $74.07, lowest since 9/17/10!!! 10/25’s high was $84.83. There have been 33!!! handles since peaking at $107.73 on June 13th, highest since 9/19/13. The record high of $147.27 was on 9/30/08, the low since on 12/30/11 is $74.95: $93.60 is the midpoint!!! Recent rally high and close are $110.70 and $110.53 respectively. RES at the 40 day ($81.91!), then the 50 day ($84.12!), and lastly the 200 day (96.69!), all continuing to accelerate to the downside! A failure here could take us to $70! The recent range is now $74.07-$112.24 since 3/1/12. Overnight it is weak again…unable to even ‘touch’ $77! Currently $76.17 -.34.

Global equities higher across the board; Japan closed: UK – vs +1% vs -0.6% vs -0.1% vs +0.5%; France +0.7% vs +2.1% vs -1.1%! vs +0.6% vs +0.7%; Germany +0.7% vs +2% vs -0.6% vs +0.7% vs +1.2%; Japan closed vs +0.3% vs -0.1% vs -0.3% vs +2.2% vs -3%; Hang Seng +2%!!! vs +0.4% vs -0.1% vs -0.7% vs -1.1% vs -1.2%; Korea +0.7% vs +0.4% vs -0.5% vs – vs +1.2%!; India +0.6% vs +1% vs +0.1% vs -0.5% vs -0.1%. U.S. equity futures also rallying: DOW +45 (range 50); SPX +5.80 (7); NDQ +15 (5??? But gapped up on the open 12 points!?!).

 

Some random thoughts:

…you have to feel sorry for Chuck Hagel…and now you have to feel sorry for us because with his resignation (remember he was a Republican senator…who ticked off his party by serving Obama!). Save some ‘sorry’ for us as the new, improved, McConnell ‘hold up all nominations’ swings into high gear. How dare Obama defy the will of the people…oops, the GOP who perceives that they are the people after ‘buying’ the elections (read: doing the bidding of the Koch brothers and a few other billionaires). Sorry, guys, but the public wants immigration reform and you are fighting it…sure Arizona is opposed…and Texas, but you aren’t asking the ag people who require that labor to make a living and get their products to market…all the way from cotton to wine!

Once again, one of the two dinosaurs believes they have a ‘mandate’, and once again they misread the vote count…perhaps because those doing the tallying are the same ones who funded the ‘candidates’ – only this time some of them didn’t win.

Tomorrow discussion of the latest Moyers & Co. edition with Lawrence Lessig and Zephyr Teachout (really her name), who ran against the ‘invincible’. Self-declared dictator…er governor…of New York and garnered 35% of the vote in the primary…this, without a single television ad! Scared Cuomo out of his wits – but now that he is safe again, back to business as usual. Cuomo, if you recall, created a commission on corruption saying no area of government was off limits…that is, until they said they were going to study his people…NYET!!! Get out of here. Hmmm, what could he possibly have to hide?

Tune in to Moyers & Co. for what’s wrong with America and how we all can fix it: Moyers: Lessig and Teachout

Have a prosperous week!

TB

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