Quote of the Day from the Friars Club Encyclopedia of Jokes: “I like long walks, especially when they are taken by people who annoy me.” – Fred Allen…a dry, very funny ‘50’s comedian
Bloomberg Quote of the Day: “If life doesn’t offer a game worth playing, then invent a new one.” – Anthony J. D’Angelo…WS already did: it’s called ‘sucker the investor.’
Bloomberg Top Stories:
*German Business Confidence Drops More Than Forecast as Economy Seen Slower
*Barclay’s $44 Million U.K. Gold Fixing Fine Hurts Rehabilitation Efforts – good, not enough!
*Euro Weakens as German Confidence Falls; Spanish, Italian Bonds Advance – Achtung!
*Spain Reaps the Reward of Economic Growth While Italy’s Yield Gap Widens
*Hacking Indictment Hints at Chinese Companies That Benefited From Attacks – good luck!
*BNP Paribas Rebound Wagers Surge as Clarity Emerges on Size of U.S. Fines
*Reynolds Is Said to Weigh Lorillard Purchase Amid Months of Negotiations
*Morgan Stanley’s London Equities Team of Four Led by Mackay Said to Leave
*Noble Returns to London Liquified Gas Trading as U.S. Shale Adds Volume – flare it!
*Ukraine, EU Elections, U.S. GDP, Pfizer Deadline – all to look forward to next week
*Golf Industry Stuck in Sand Trap as Thousands of Americans Leave the Sport- ever been to Myrtle Beach, S.C.? 21 championship courses BUT FORTY-NINE miniature golf locations! Fact!
*Putin’s Black Sea Singapore Dream Leaves Crimeans Without Banks or Burgers – cringing?
*Putin Says Russia Will Work With Elected President of Ukraine After Vote
*Thai Coup Risks Deadly Clashes as Thaksin Camp Is Seen as Better Organized
*Obama to Unveil San Antonio Mayor Castro as Choice for Housing Secretary
*Russia Threatens to Counter NATO Buildup on Its Borders as Rivalry Continues – not good!
*Congress Spurns Pentagon Cost Reductions Cuts From A-a0 to Base Closures – this is sick! The GOP can find NO cuts in defense…it’s a sieve for money run by more oligarchs!
*Scottish Nuclear Subs Show Independence Risks More Than Just U.K. Economy – in kilts?
Thursday’s Market Summary:
First off, today will be an early close for bonds (we always get the breaks, right?), which means it will be probably closed by the time you read this…so you can devote the rest of your day to stocks….you know…the things that really matter (joke!).
Ah a nice rally…didn’t you think? Oops, that was Wednesday…yesterday all indices ere up but the winner was the Russell 2000 +0.9%, followed by DOW UTILITIES!!! +0.8%, the rest were up from 0.2% (S&P 500) to 0.6% (Nasdaq Composite) followed by Dow Transports +0.5%. Let’s see what did we forget? Oh, yeah,,,the Dow which was up 1% Wednesday followed up with a puny 0.1% gain! Does anything have traction here?…besides Utilities and other income producing stocks, REITS, and ETF’s? Lemme know if you find the answer.
Total NYSE Volume sure didn’t look like excited (but we are ahead of a long weekend with most not trading tomorrow) declining a bit more to an even weaker 2.74B shares vs 2.77B vs 2.97B vs 2.64B!!! …that’s from 3.18B last Friday (remember it was an options expiration!) from an average 3.53B – on a ‘down’ day! Real trades on the floor of the NYSE stunk slipping further to 577M shares from a very weak 587M and now 147M BELOW the 12-month average! Yesterday;s achieved notoriety by replacing Tuesday’s 584M share day as the second lowest of 2014…1/3’s 544M is the low…note 12/31’s was 568M shares. Worse: since 4/30 the average has been just 663M shares with just two 700M days – one barely! The high this month is 775M while the low is 584M just below yesterday’s! Nice rally, eh???
A/D’s were positive again but meaningless: NYSE +2x vs +2.6x vs -2.4x vs +1.8x vs +2.1x vs -2.3x vs -2.1x; Nasdaq +2.1x vs +1.5x! vs -3.1x vs +2.2x vs +1.5x vs -2.1x vs -2.8x. Breadth was similar: NYSE +1.8x vs +2.6x vs -4.1x! vs +1.6x vs +1.5x vs -4x!!! vs -2.1x; Nasdaq +2.6x vs +2.7x vs -3.1x! vs +3x! vs +1.5x vs -2.5x vs -3.3x. But who cares when the volume is so low? New 52 Week Highs rose but about average at 187 vs 132 vs 111 vs 143 vs 71!!! vs 107 vs 208 vs 233 vs 93!!! New Lows dropped sharply to a weak 62 (never short a thin market) vs 95 vs 118 vs 72 vs 180 vs 102 vs 62 vs 65 vs 214!!!
Lastly volatility…S&P VIX remains bullish…up just .10 to 12.01 with a range of 11.68-12.09 – narrower than Wednesday’s and inside it.
Overnight markets as of 2pm EDT (late!,:
Bonds closed slightly lower for a second day after the nice rally last Monday. Not surprising given the early close ahead of the Memorial Day weekend. The 10 yr closed at 2.55% -3/16 vs 2.53% vs 2.54% vs 2.52%; 30’s 3.42% -1/4 vs 3.41% vs 3.38% vs 3.39% vs 3.35%. The long TIP, as low as 1.00% a week ago, closed 1.09 UP 3/16 vs 1.10% vs 1.08% vs 1.08% vs 1.02%. Overnight and this afternoon weaker again: 10’s 2.56% -1/4; 30’s 3.43% -3/8; and long TIP 1.10% –. 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: 0.229% 3 mos.; 0.324% 6 mos., both just off their record lows, set recently: 0.227% and 0.32% respectively! NOTE the Fed Funds rate has averaged 0.08% since 5/22/13 and is 0.07% -0.09%. Foreign bond market mixed with Italy, Spain and Portugal sharply lower: Germany 1.41% +1; UK 2.65% –; France 1.81 –; Italy 3.16% -8!!!; Spain 2.98%! -6!; Portugal 3.74% -6!; Greece which bottomed at 5.83% on 2/24 still struggling but closed strong yesterday and is now 6.38% -1 vs 6.39% – high was 6.75%. Highly volatile!!! Range is 5.77% to 12.57%. Japan: 0.58% -1.
Gold closed slightly higher at a meaningless $1295.40 +6.90 with just a blip to $1304.10 in a very narrow range session. This after hitting $1309.20 a week ago. It remains below the 40/50/200 days and the psych support level of $1300 with first res at the 40 day $1297, then the 200 day $1299, and the 50 day $1306. Following the ‘key reversal’ on 3/17 after printing new recent high of $1392.60, highest high since 9/4/13 – which ended in an outside day and nearly a negative key reversal! Jan. 2’s low was $1181.40 – A MULTI-DECADE LOW!!! Overnight slightly weaker in a narrow range, now $1291.60 -$3.60 – session low $1289.80.
Crude closed slightly lower at $103.74 -.33 in a very narrow inside session. Weds. high was $104.29 – highest since being slammed on 4/22! 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 with support at the 40 day ($101.69) then the 50 day ($101.21), and 200 day $100.34. The recent range is $85.61-$112.24 since March 1, 2012. Overnight, modestly higher at $104.05 +.31, high $104.08.
Global equity markets little changed; India and Japan higher: UK -0.2% vs +0.1% vs -0.5% vs -0.3% vs -0.1%; France +0.1% vs +0.2% vs -0.2% vs +0.1% vs +0.1%; Germany +0.2% -despite weaker economic confidence??? vs +0.5% vs -0.2% vs -0.1% vs -0.3%; Japan +0.9% vs -0.2% vs +0.5% vs -0.6% vs -1.4%! Hang Seng +0.1% vs – vs +0.6% vs – vs -0.1%; Korea +0.1% vs +0.1% vs -0.1% vs +0.1% vs +0.2%; India +1.3%! vs -0.3% vs +0.1% vs +1%! vs +0.9%. U.S. Stock Index Futures boring: DOW +7 (range 23); SPX +1.30 (3!); NDQ +4.25 (7!).
Some random thoughts:
…as a Viet Nam vet TB asks that you think of those who gave their lives…and limbs…and much more for this country that has become so undeserving. TB felt this especially after visiting our nations capitol and noting that the ‘me’ generation is very much alive and well.
Two years ago, TB voted a second time for Barrack Obama, the first because John McCain has even less clout in the GOP than John Boehner does at controlling the dysfunctional House – all his party! Big John sealed the deal with his choice of Sarah Palin as his running mate plus there was a promise of ‘changing how government operates from Obama. Nevermind that they didn’t have a clue how they were going to change it (per Lawrence Lessig), nor did they attempt to do so. The last time as there was NO choice…not when Mitt Romney proposed ‘changes’ to make the country even more ‘oligarchial’ – a concern of some of his fellow Mormons who feared a backlash if he didn’t do a good job of running the country.
George W. Bush…and the ‘acting’ president, Dick Cheney, along with Donald Rumsfeld did more to deprive Americans of their rights than any other president in our history. Watch Frontline’s two-part series The United States of Secrets, part two is the most important as it opens with a summary of the first part. The point is the Snowden is no more a traitor than Daniel Ellsberg was (although TB thought he was at the time), in releasing the Pentagon Papers which shed light on the government’s lies about the Viet Nam war (note Ellsberg said that Snowden was right to flee the country – as opposed to the joint leaders of the Intelligence (sic) Committee, Rep. Rogers (R) and Sen. Feinstein (D), who believed everything that Gen. Clapper (watch the movements of him in his testimony and you decide if he was lying – a fact he later said in a memo to the committee! Of course, no perjury charges for him).
Obama not only failed to change government but he changed the level of the cabinet with people second-guessing those in charge and influencing Obama. He promised to end the spying, and to shutdown Guantanamo…instead he bolstered both.
He speaks passionately about everything but we have come to know that it goes no further than that. He drew a line in the sand on Syria…then what? Iran? He was right in his handling of Libya and is being crucified in yet another politically-motivated ‘investigation’ of Benghazi. The truth? They don’t want the truth…just to humiliate…just as the House has voted over 50 times to end Obamacare. A wasted of time, resources, and creating even more angst among both parties and the public. Stuff happens! Also, the Ambassador was warned not to go to Benghazi and there were ten CIA operatives with him…of which two were casualties. Let’s be honest!
We hear a lot about what his legacy will be. To be sure, the ACA is a step in the right direction but the wrong step…it does nothing to control costs of care or drugs…especially drugs which he sold out to the Pharma lobby on. But so far that is the only legacy TB see…a ‘half-vast’ one (some might say half-assed). How sad that the misguided Occupy Wall Street movement (sic) was the only attempt by anyone at Wall Street accountability (the name itself is a negative…TB proposed Reform Corporate America (RCA) – and Congress. Too bad all those people who have written excellent books on the crisis can’t band together and strike boldly at Congress in unison. Is that too much to ask? Apparently, so…individually, it is divide and conquer…and it is working!
It is time for us to demand Congress represent WE, the people and not the oligarchs of Wall Street, the defense industry and over the well-being of Main Street. Our ‘free’ government has become a sham…a mockery and one which lowers us in the eyes of the rest of the world.
Will change come? Of course it will…but will it be too late for the government and country as we know it. If that comes to pass it will be a very sad Memorial Day for us all…especially the future generations.
Disagree? That is your right…and TB does not expect or wish you to simply agree with him. But he does hope you will think and act responsibly and do the right thing. Nothing is not an option.
Have a wonderful but reflective Memorial Day weekend,