For the third time in the past four sessions, the major indices exhibited what can only be described as a disturbing trend: a late-day sell-off sending the averages back down to, or below, their opening levels.
This similar pattern - of stocks rising in the morning, leveling off and then dropping like stones off a mountain, has been identified this past Monday and Tuesday, and was exceptionally profound in the short session, Friday.
In general terms, no news accompanied the rise or falls, so, it should be regarded as an algorithm-trading-based function, as it's unlikely that humans would react in such herd-like behavior (well, maybe) as stocks have shown this week.
Friday's decline on the Dow and S&P (the NASDAQ managed to finish positive) might be viewed by those more occupied with Black Friday shopping than stocks as a minor issue - only 10 points on the Dow - though taken with the perspective of the whole 3 1/2-hour trading day, the dump was off a level that had the Dow at all-time highs, up 78 points on the day in early trading, finally losing all bids in the final twenty minutes.
Delving deeper into the phenomenon, Friday's decline could be the result of channel checks or car counting at selected retail locations that some organizations were conducting over the course of what is widely believed to be the biggest retail shopping day of the year. If, for instance, some of the trading firms were being fed less-enthusiastic figures from the field, it's not outside the realm of speculation that some adroit stock jocks could have been taking profits late in the day, and that would bode ill for a shopping season that's already six days shorter than last year's and, according to some analysis, may be the worst holiday season since 2009.
In that case, stocks should be expected to not just fail at the close, but moreso at the open, in coming days. Traders will have the weekend to figure this out, so, looking forward to Monday, a quiet open and negative finish might just confirm the retail fears. Saturday and Sunday shopping will be recorded by the compilers of such data and disseminated to market participants well ahead of Monday's opening bell.
With November jobs data due out Friday, the first week of December may be a watershed event for traders. Stocks are up significantly over the course of the year, by some measures, exceedingly so, and there hasn't been a sizable pullback in stocks since the government shutdown in November.
Additionally, the ACA website is supposed to be up and running at 80% capacity come Saturday, and more issues with the entire ObamaCare program might just give speculators enough reason to put on the brakes.
Of course, money has to go somewhere, so there's likely an equal chance that there will be a "Santa Claus" rally on top of this year's already-substantial gains, and the recent trend of late-day selling disregarded as nothing more than an algorithmic anomaly.
Whatever the case, next week bears close scrutiny, no matter which way one is playing the market. The larger picture, with stocks being buoyed by the Fed's incessant money-creation, remains decidedly bullish.
DOW 16,086.41, -10.92 (-0.07%)
NASDAQ 4,059.89, +15.14 (+0.37%)
S&P 1,805.81, -1.42 (-0.08%)
10-Yr Note 99.96, -0.07 (-0.07%)
NASDAQ Volume 823.70 Mil
NYSE Volume 1.59 Bil
Combined NYSE & NASDAQ Advance - Decline: 3173-2307
Combined NYSE & NASDAQ New highs - New lows: 528-27
WTI crude oil: 93.25, +0.95
Gold: 1,250.60, +12.80
Silver: 19.98, +0.348
Corn: 424.50, -2.00
Friday, November 29, 2013
Wednesday, November 27, 2013
Stocks Post More Gains Prior to Thanksgiving Holiday
The S&P and Dow set new all-time closing marks on Wednesday and the NASDAQ is approaching levels not seen since the dotcom boom (and bust), but, according to just about anyone who appears on CNBC or Bloomberg, there is no bubble in equities.
And, the Fed buying up $85 billion in bonds every month is normal. Gold stuck around $1250 is normal.
The p/e of Facebook (FB) is 77. Nope, no bubble there. Carry on.
Happy Thanksgiving.
The markets are open until 1:00 pm ET on Black Friday, which is usually a big ramp-up day on low volume, so sharpen up your day-trading skills and make some easy moolah while everyone else is out shopping.
Better get bitcoin. If you don't know what bitcoin is, you'd be doing yourself a favor to find out.
DOW 16,097.33, +24.53 (+0.15%)
NASDAQ 4,044.75, +27.00 (+0.67%)
S&P 1,807.23, +4.48 (+0.25%)
10-Yr Note 99.90, -0.20 (-0.20%)
NASDAQ Volume 1.33 Bil
NYSE Volume 2.36 Bil
Combined NYSE & NASDAQ Advance - Decline: 3691-1937
Combined NYSE & NASDAQ New highs - New lows: 469-55
WTI crude oil: 92.30, -1.38
Gold: 1,237.80, -3.60
Silver: 19.63, -0.215
Corn: 426.50, 1.75
And, the Fed buying up $85 billion in bonds every month is normal. Gold stuck around $1250 is normal.
The p/e of Facebook (FB) is 77. Nope, no bubble there. Carry on.
Happy Thanksgiving.
The markets are open until 1:00 pm ET on Black Friday, which is usually a big ramp-up day on low volume, so sharpen up your day-trading skills and make some easy moolah while everyone else is out shopping.
Better get bitcoin. If you don't know what bitcoin is, you'd be doing yourself a favor to find out.
DOW 16,097.33, +24.53 (+0.15%)
NASDAQ 4,044.75, +27.00 (+0.67%)
S&P 1,807.23, +4.48 (+0.25%)
10-Yr Note 99.90, -0.20 (-0.20%)
NASDAQ Volume 1.33 Bil
NYSE Volume 2.36 Bil
Combined NYSE & NASDAQ Advance - Decline: 3691-1937
Combined NYSE & NASDAQ New highs - New lows: 469-55
WTI crude oil: 92.30, -1.38
Gold: 1,237.80, -3.60
Silver: 19.63, -0.215
Corn: 426.50, 1.75
Tuesday, November 26, 2013
Why There's No Inflation and No Growth... (and why that's good for some)
Stocks were up modestly on Tuesday, as is the usual practice during the week of Black Friday Thanksgiving. There's a general feeling of well-being about, and, even though the gains this year have been the best since something like 1997, buyers of stocks know how to do nothing else, so they keep on buying. Actually, the turn-about in the inal half hour erased most of the day's gains on the Dow and S&P, especially. The NASDAQ finished above 4000, for the first time since 2000, when it crossed that threshold from the other side.
Stocks, bought with ridiculously cheap money via the Fed, are, and have been, producing fatastic returns for many investors and holders of pensions, 401ks, IRAs, etc., but the nagging suspicion that it can't really be this easy continues to gnaw at the fringes of consciousness.
For now, it really is this easy. There's no compelling reason to do anything but buy more stocks, not sell and keep watching them go higher. It's a very powerful positive feedback loop. The Fed's continuous debt-purchasing and zero-bound interest rates fuel the stock market, have contributed greatly to the rebound in real estate prices, but, stubbornly, unemployment simply won't go down appreciably, and that's an issue, though most of the barons of the financial world can't, or don't, really care about the ordinary citizens struggling to eke out a living.
Also troubling is the idea that all this debt-binge-buying by the Fed hasn't produced inflation, which, according to all Keynesian estimates on the topic, should be raging by now.
But, something un-funny happened on Ben Bernanke's way to the printing press. While the Federal Reserve and the behemoth banks have been busy leveraging up, the average American (and European) has been leveraging down, using the limited free money that comes their way to pay down debt, stop spending frivolously and horror of horrors, save.
Official statistics will deny that Americans are saving anything at all. Many, for certain, are not. In fact, HELOC loans are once again on the rise. But others, quietly, off-the-radar, have been squirreling away small amounts, mostly in cash, though some in gold, silver, bulk foods, and saving in other ways like repairing an aging vehicle instead of buying a new one, shopping at discount stores, buying online, bartering and other creative ways that are having an unseen impact because they are individually so small as to be unnoticeable, but collectively, they become huge.
Imagine, for a minute, the impact of 10,000 people individually not buying one Starbucks coffee per week. On the individual basis, it's three or four dollars. Collectively, however, it's $30-40,000. Then start adding up the other ways people are saving. Driving less or coordinating their driving to do many tasks on one trip. A couple of dollars a week. Home gardens that can shave $10 to $40 off a family's food bill in season is another hidden savings the statisticians can't capture with their computers. There are many, many more practical methods people are using today to save on everything from food to fuel to... well, you name it. Cut your own hair, heat with firewood partially, buy clothes at thrift stores, eat out less (or not at all), don't go to movies, and on and on and on.
The Fed doesn't get it. Wall Street doesn't get it. Most public employees don't get it. They're conditioned to be like their co-workers. Buy a new car, or lease one. Eat out for lunch. See the latest movies. Buy new clothes. They, and the 47 million on food stamps, are keeping the economy just clinging to life. But, despite the added liquidity by the Fed, it's not working so well. Corporations aren't beating their revenue figures. Bottom lines are good, but much of it is due to shrinking the number of shares outstanding via stock repurchase programs, which also add to the stock market boom.
But, there's a horde of people out there who are getting out of the system, cutting their cable bills, credit cards, magazine subscriptions, and, soon, because of the nightmare that is ObamaCare, their monthly health insurance bill.
Some, like economists at the Fed or analysts on Wall Street, might call these types an underclass. In reality, they are the new freedom class, untying the knot of debt, freeing their minds from the day-to-day toil and keeping up with the Joneses mentality that feeds the corporate machine.
The signs of frugality and savings - despite the overblown hype of Black Friday being bellowed by the big merchants - are everywhere. Gold, silver, bitcoin, eBay, Craigslist, barter exchanges, healthy, home-grown foods instead of corporate fast-food mulch, economy cars, hybrids and public transportation are all taking the bluster out of the Wall Street boom.
When the dust settles, when the Fed stops printing to infinity and the economy begins to normalize, there's an old adage used by printers, manufacturers and writers of software that will be apropos: "Garbage In, Garbage Out."
The garbage in is the cheap money the Fed has been printing nilly-willy. The garbage out will be a steady, possibly spectacular, stock market decline. It may not be a crash, happening all of a sudden, but there will be a bear market, eventually. After all, this bull run began in March 2009. It's now a 57-month old bull, which, by most measures, is a little long in the tooth. The signs are everywhere. Corporate profits are of exceedingly poor quality (garbage out).
When this era of cheap money comes to an end - and end it will - many who made money all along will be left holding stocks worth much less than what they paid for them. Many of the companies represented by these stocks will have upside-down balance sheets because of all the stock they bought back at nose-bleed prices. And that's going to be a real problem, causing more layoffs, consolidations, and bankruptcies (yes, we still have them). JC Penny will be the first to go. They're overdue and probably will file within months after the holiday season, which, for them, will be a disaster. They will be followed by Sears, and then after the retailers get moving in the wrong direction, the filings will snowball.
Garbage in, garbage out. Those who've been saving, rejecting the debt-slave system and prepping will be much less affected, already living well within their means and enjoying it.
Happy Thanksgiving!
DOW 16,072.80, +0.26 (+0.00%)
NASDAQ 4,017.75, +23.18 (+0.58%)
S&P 1,802.75, +0.27 (+0.02%)
10-Yr Note 100.36, +0.31 (+0.31%)
NASDAQ Volume 1.79 Bil
NYSE Volume 3.40 Bil
Combined NYSE & NASDAQ Advance - Decline: 3292-2338
Combined NYSE & NASDAQ New highs - New lows: 431-93
WTI crude oil: 93.68, -0.41
Gold: 1,241.40, +0.20
Silver: 19.85, -0.034
Corn: 424.75, -6.50
Stocks, bought with ridiculously cheap money via the Fed, are, and have been, producing fatastic returns for many investors and holders of pensions, 401ks, IRAs, etc., but the nagging suspicion that it can't really be this easy continues to gnaw at the fringes of consciousness.
For now, it really is this easy. There's no compelling reason to do anything but buy more stocks, not sell and keep watching them go higher. It's a very powerful positive feedback loop. The Fed's continuous debt-purchasing and zero-bound interest rates fuel the stock market, have contributed greatly to the rebound in real estate prices, but, stubbornly, unemployment simply won't go down appreciably, and that's an issue, though most of the barons of the financial world can't, or don't, really care about the ordinary citizens struggling to eke out a living.
Also troubling is the idea that all this debt-binge-buying by the Fed hasn't produced inflation, which, according to all Keynesian estimates on the topic, should be raging by now.
But, something un-funny happened on Ben Bernanke's way to the printing press. While the Federal Reserve and the behemoth banks have been busy leveraging up, the average American (and European) has been leveraging down, using the limited free money that comes their way to pay down debt, stop spending frivolously and horror of horrors, save.
Official statistics will deny that Americans are saving anything at all. Many, for certain, are not. In fact, HELOC loans are once again on the rise. But others, quietly, off-the-radar, have been squirreling away small amounts, mostly in cash, though some in gold, silver, bulk foods, and saving in other ways like repairing an aging vehicle instead of buying a new one, shopping at discount stores, buying online, bartering and other creative ways that are having an unseen impact because they are individually so small as to be unnoticeable, but collectively, they become huge.
Imagine, for a minute, the impact of 10,000 people individually not buying one Starbucks coffee per week. On the individual basis, it's three or four dollars. Collectively, however, it's $30-40,000. Then start adding up the other ways people are saving. Driving less or coordinating their driving to do many tasks on one trip. A couple of dollars a week. Home gardens that can shave $10 to $40 off a family's food bill in season is another hidden savings the statisticians can't capture with their computers. There are many, many more practical methods people are using today to save on everything from food to fuel to... well, you name it. Cut your own hair, heat with firewood partially, buy clothes at thrift stores, eat out less (or not at all), don't go to movies, and on and on and on.
The Fed doesn't get it. Wall Street doesn't get it. Most public employees don't get it. They're conditioned to be like their co-workers. Buy a new car, or lease one. Eat out for lunch. See the latest movies. Buy new clothes. They, and the 47 million on food stamps, are keeping the economy just clinging to life. But, despite the added liquidity by the Fed, it's not working so well. Corporations aren't beating their revenue figures. Bottom lines are good, but much of it is due to shrinking the number of shares outstanding via stock repurchase programs, which also add to the stock market boom.
But, there's a horde of people out there who are getting out of the system, cutting their cable bills, credit cards, magazine subscriptions, and, soon, because of the nightmare that is ObamaCare, their monthly health insurance bill.
Some, like economists at the Fed or analysts on Wall Street, might call these types an underclass. In reality, they are the new freedom class, untying the knot of debt, freeing their minds from the day-to-day toil and keeping up with the Joneses mentality that feeds the corporate machine.
The signs of frugality and savings - despite the overblown hype of Black Friday being bellowed by the big merchants - are everywhere. Gold, silver, bitcoin, eBay, Craigslist, barter exchanges, healthy, home-grown foods instead of corporate fast-food mulch, economy cars, hybrids and public transportation are all taking the bluster out of the Wall Street boom.
When the dust settles, when the Fed stops printing to infinity and the economy begins to normalize, there's an old adage used by printers, manufacturers and writers of software that will be apropos: "Garbage In, Garbage Out."
The garbage in is the cheap money the Fed has been printing nilly-willy. The garbage out will be a steady, possibly spectacular, stock market decline. It may not be a crash, happening all of a sudden, but there will be a bear market, eventually. After all, this bull run began in March 2009. It's now a 57-month old bull, which, by most measures, is a little long in the tooth. The signs are everywhere. Corporate profits are of exceedingly poor quality (garbage out).
When this era of cheap money comes to an end - and end it will - many who made money all along will be left holding stocks worth much less than what they paid for them. Many of the companies represented by these stocks will have upside-down balance sheets because of all the stock they bought back at nose-bleed prices. And that's going to be a real problem, causing more layoffs, consolidations, and bankruptcies (yes, we still have them). JC Penny will be the first to go. They're overdue and probably will file within months after the holiday season, which, for them, will be a disaster. They will be followed by Sears, and then after the retailers get moving in the wrong direction, the filings will snowball.
Garbage in, garbage out. Those who've been saving, rejecting the debt-slave system and prepping will be much less affected, already living well within their means and enjoying it.
Happy Thanksgiving!
DOW 16,072.80, +0.26 (+0.00%)
NASDAQ 4,017.75, +23.18 (+0.58%)
S&P 1,802.75, +0.27 (+0.02%)
10-Yr Note 100.36, +0.31 (+0.31%)
NASDAQ Volume 1.79 Bil
NYSE Volume 3.40 Bil
Combined NYSE & NASDAQ Advance - Decline: 3292-2338
Combined NYSE & NASDAQ New highs - New lows: 431-93
WTI crude oil: 93.68, -0.41
Gold: 1,241.40, +0.20
Silver: 19.85, -0.034
Corn: 424.75, -6.50
Monday, November 25, 2013
Stocks Rise, Then Fall, End Flat; Dow Up 16X in 31 Years Though Not the Same
Stocks flew at the open, making the highs of the session, then backtracked, recovered and finally flat-lined until 3:00 pm ET, when selling commenced, taking the indices back to break-even for the day.
It was mostly a senseless trade, kicking off a holiday-shortened week which will feature lower volume than usual (if that's possible) and giddiness surrounding the holiday shopping season, which almost always produces an up session on the short Friday after Thanksgiving.
A few friends were commenting on the wisdom of a buy and hold strategy for the long haul as the Dow Jones Industrials crossed the 16,000 threshold this past Friday. One idea was that holding an index fund of Dow stocks from late 1982 to the present would have resulted in a 16X return on your money, or $10,000 invested in the Dow in 1982 - the last time the Dow crossed the 1000 mark and did not fall below it - would be worth $160,000 today.
It's an interesting concept, but, in case somebody wanted to just buy all the individual stocks in the Dow 30 blue chips, it would have probably been a more profitable, albeit time-consuming endeavor. Of the 30 stocks in the Dow today, only 10 of them were part of the index back in late 1982.
Those ten are AT&T, American Express, IBM, duPont, 3M, Proctor & Gamble, GE, United Technologies, Merck and Exxon (merged with Mobil to form ExxonMobil).
In those 31 years, the composition of the Dow changed 13 times, including eight times since 2003. Not to say that the stocks in the Dow are all magnificent winners, but how one gets a 16X return is by taking out under-performers and replacing them with stocks which have a better chance of appreciation, kind of a shell game, though one could have done well just holding any fund indexed to the famous average.
By way of comparison, the S&P 500 rose from about 140 to the current level just above 1800 in the same time period, a gain of just over 13X. Of course, the S&P has even more movement in and out of the index, and weightings are changed periodically. Overall, it gets re-jiggered more often than the Dow.
It's how Wall Street produces outsize profits for investors; they change the game constantly or as conditions warrant. It begs the question of the wisdom of individual issues and fast money trading.
"It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning." --Henry Ford
DOW 16,072.54, +7.77 (+0.05%)
NASDAQ 3,994.57, +2.92 (+0.07%)
S&P 1,802.48, -2.28 (-0.13%)
10-Yr Note 100.10 +0.09 (+0.09%)
NASDAQ Volume 1.74 Bil
NYSE Volume 2.99 Bil
Combined NYSE & NASDAQ Advance - Decline: 2701-2954
Combined NYSE & NASDAQ New highs - New lows: 532-96
WTI crude oil: 94.09, -0.75
Gold: 1,241.20, -2.90
Silver: 19.88, +0.02
Corn: 431.25, +2.00
It was mostly a senseless trade, kicking off a holiday-shortened week which will feature lower volume than usual (if that's possible) and giddiness surrounding the holiday shopping season, which almost always produces an up session on the short Friday after Thanksgiving.
A few friends were commenting on the wisdom of a buy and hold strategy for the long haul as the Dow Jones Industrials crossed the 16,000 threshold this past Friday. One idea was that holding an index fund of Dow stocks from late 1982 to the present would have resulted in a 16X return on your money, or $10,000 invested in the Dow in 1982 - the last time the Dow crossed the 1000 mark and did not fall below it - would be worth $160,000 today.
It's an interesting concept, but, in case somebody wanted to just buy all the individual stocks in the Dow 30 blue chips, it would have probably been a more profitable, albeit time-consuming endeavor. Of the 30 stocks in the Dow today, only 10 of them were part of the index back in late 1982.
Those ten are AT&T, American Express, IBM, duPont, 3M, Proctor & Gamble, GE, United Technologies, Merck and Exxon (merged with Mobil to form ExxonMobil).
In those 31 years, the composition of the Dow changed 13 times, including eight times since 2003. Not to say that the stocks in the Dow are all magnificent winners, but how one gets a 16X return is by taking out under-performers and replacing them with stocks which have a better chance of appreciation, kind of a shell game, though one could have done well just holding any fund indexed to the famous average.
By way of comparison, the S&P 500 rose from about 140 to the current level just above 1800 in the same time period, a gain of just over 13X. Of course, the S&P has even more movement in and out of the index, and weightings are changed periodically. Overall, it gets re-jiggered more often than the Dow.
It's how Wall Street produces outsize profits for investors; they change the game constantly or as conditions warrant. It begs the question of the wisdom of individual issues and fast money trading.
"It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning." --Henry Ford
DOW 16,072.54, +7.77 (+0.05%)
NASDAQ 3,994.57, +2.92 (+0.07%)
S&P 1,802.48, -2.28 (-0.13%)
10-Yr Note 100.10 +0.09 (+0.09%)
NASDAQ Volume 1.74 Bil
NYSE Volume 2.99 Bil
Combined NYSE & NASDAQ Advance - Decline: 2701-2954
Combined NYSE & NASDAQ New highs - New lows: 532-96
WTI crude oil: 94.09, -0.75
Gold: 1,241.20, -2.90
Silver: 19.88, +0.02
Corn: 431.25, +2.00
Friday, November 22, 2013
50 Years Ago and We Still Don't Know Why Kennedy Was Killed
Please, no matter what you may believe, instead of reading articles or watching videos, just contemplate the Kennedy assassination for a few moments.
Food for thought, presented without comment.
DOW 16,064.77, +54.78 (+0.34%)
NASDAQ 3,991.65, +22.49 (+0.57%)
S&P 1,804.76, +8.91 (+0.50%)
10-Yr Note 99.94, +0.72 (+0.73%)
Combined NYSE & NASDAQ Advance - Decline: 3500-2147
NASDAQ Volume 1.65 Bil
NYSE Volume 2.96 Bil
Combined NYSE & NASDAQ New highs - New lows: 461-76
WTI crude oil: 94.84, -0.60
Gold: 1,244.10, +0.50
Silver: 19.86, -0.072
Corn: 429.25, -0.25
Food for thought, presented without comment.
DOW 16,064.77, +54.78 (+0.34%)
NASDAQ 3,991.65, +22.49 (+0.57%)
S&P 1,804.76, +8.91 (+0.50%)
10-Yr Note 99.94, +0.72 (+0.73%)
Combined NYSE & NASDAQ Advance - Decline: 3500-2147
NASDAQ Volume 1.65 Bil
NYSE Volume 2.96 Bil
Combined NYSE & NASDAQ New highs - New lows: 461-76
WTI crude oil: 94.84, -0.60
Gold: 1,244.10, +0.50
Silver: 19.86, -0.072
Corn: 429.25, -0.25
Thursday, November 21, 2013
Stocks Pop on Bad News from Philly Fed
Well, bad news for the economy is apparently good news for Wall Street once again.
The Philadelphia Fed's Index of business activity in the Mid-Atlantic region slowed significantly, according to the report issued today, which showed the index falling from 19.8 in October, to 6.5 in November, a drop that exceeded even the most pessimistic estimates.
The consensus was for the index to come in with a reading of 15.0, but the number was well below that. The convoluted thinking dominating the financial world today must have seen this as yet another sign of slowing economic activity, making it next to impossible for the Federal Reserve to begin slowing its monthly bond purchases from their current $85 billion per month.
Stocks, which were already showing healthy gains before the 10:00 am ET release, chopped their way higher throughout the session, with the Dow Jones Industrials ending the day at an all-time closing high.
With an eroding base economy and billions of created-out-of-thin-air dollars flooding the coffers of the primary dealers via the Fed, the market pricing mechanism is as broken as it has ever been in the history of economics.
Fantasy accounting, assets marked to nothing or anything, and all the other central bank meddling and criminality undertaken by Wall Street and global banking interests will eventually find its way back into the real world. The result may not be to the liking of anybody.
DOW 16,009.99, +109.17 (+0.69%)
NASDAQ 3,969.15, +47.88 (+1.22%)
S&P 1,795.85, +14.48 (+0.81%)
10-Yr Note 99.65, +0.48 (+0.49%)
NASDAQ Volume 1.64 Bil.
NYSE Volume 3.25 Bil.
Combined NYSE & NASDAQ Advance - Decline: 4246-1420
Combined NYSE & NASDAQ New highs - New lows: 327-102
WTI crude oil: 95.44, +1.59
Gold: 1,243.60, -14.40
Silver: 19.93, -0.124
Corn: 429.50, +4.25
The Philadelphia Fed's Index of business activity in the Mid-Atlantic region slowed significantly, according to the report issued today, which showed the index falling from 19.8 in October, to 6.5 in November, a drop that exceeded even the most pessimistic estimates.
The consensus was for the index to come in with a reading of 15.0, but the number was well below that. The convoluted thinking dominating the financial world today must have seen this as yet another sign of slowing economic activity, making it next to impossible for the Federal Reserve to begin slowing its monthly bond purchases from their current $85 billion per month.
Stocks, which were already showing healthy gains before the 10:00 am ET release, chopped their way higher throughout the session, with the Dow Jones Industrials ending the day at an all-time closing high.
With an eroding base economy and billions of created-out-of-thin-air dollars flooding the coffers of the primary dealers via the Fed, the market pricing mechanism is as broken as it has ever been in the history of economics.
Fantasy accounting, assets marked to nothing or anything, and all the other central bank meddling and criminality undertaken by Wall Street and global banking interests will eventually find its way back into the real world. The result may not be to the liking of anybody.
DOW 16,009.99, +109.17 (+0.69%)
NASDAQ 3,969.15, +47.88 (+1.22%)
S&P 1,795.85, +14.48 (+0.81%)
10-Yr Note 99.65, +0.48 (+0.49%)
NASDAQ Volume 1.64 Bil.
NYSE Volume 3.25 Bil.
Combined NYSE & NASDAQ Advance - Decline: 4246-1420
Combined NYSE & NASDAQ New highs - New lows: 327-102
WTI crude oil: 95.44, +1.59
Gold: 1,243.60, -14.40
Silver: 19.93, -0.124
Corn: 429.50, +4.25
Wednesday, November 20, 2013
Stocks Fall After October Fed Minutes Released; Deflation Commences
Just in case anyone forgot that the only thing that matters in this market is Federal Reserve policy, the message was forcefully driven home precisely at 2:00 pm ET, when the minutes from the last FOMC meeting were released.
Within those arcane discussions of all things monetary were warnings from more than a few members that tapering bond purchases by the Fed might begin sooner rather than later. Accepted thinking had been that the Fed would not taper until March, though after today, analysts are suggesting that December - just two weeks away - might mark the beginning of the end of the Fed's bond-buying spree.
While the cutback in bond purchases monthly may only be a decrease of $10 to $15 billion of the current $85 billion, Wall Street money-grubbers were spooked as usual at the suggestion that money would be anything other than nearly free to borrow.
Today's action in stocks shows just how fragile the 4 1/2-year-plus market rally is and how quickly paper profits may vanish if the Fed doesn't keep the money-printing machine going pedal to the metal.
It's a ridiculous market made up of ridiculous valuations and propositions, that, without Herculean-like support from the central bank, could fall apart in days or weeks.
The Fed will no doubt taper, the only remaining questions are when and by how much. Whatever the decision shall be, markets will not like it one bit, and the general economy may suffer even more than it already has as Wall Street will no doubt throw a massive hissy fit.
When it's all done with, when the Fed stops buying bonds altogether (when will that be, 2065?), either stocks or the US dollar (and maybe both) will be worth a lot less than they are today.
Lunatic policies by the Fed will be followed in time by equally hilarious conclusions to those misguided policies. The results will be a catastrophe financial markets have never seen before.
What is either amusing or distressing is the reaction in precious metal markets, which fell in concert with stocks and bonds. If the markets are correct, Fed tapering will be a deflationary event with magnificent outcomes ahead.
In the long term, the Fed cannot taper back on bond purchases because they have succeeded in crowding out the few remaining participants over the past four years. Deflations and defaults will be the most likely results, though emerging markets will feel the pain much sooner and to a much greater degree than established economies, though no nation will be spared the death spiral of deflation.
Dow 15,900.82, -66.21 (0.41%)
Nasdaq 3,921.27, -10.28 (0.26%)
S&P 500 1,781.37, -6.50 (0.36%)
10-Yr Bond 2.79%, +0.08
NYSE Volume 3,094,246,250
Nasdaq Volume 1,686,541,875
Combined NYSE & NASDAQ Advance - Decline: 2180-3428
Combined NYSE & NASDAQ New highs - New lows: 162-98
WTI crude oil: 93.33, -0.01
Gold: 1,258.00, -15.50
Silver: 20.06, 0.276
Corn: 425.25, -1.00
Within those arcane discussions of all things monetary were warnings from more than a few members that tapering bond purchases by the Fed might begin sooner rather than later. Accepted thinking had been that the Fed would not taper until March, though after today, analysts are suggesting that December - just two weeks away - might mark the beginning of the end of the Fed's bond-buying spree.
While the cutback in bond purchases monthly may only be a decrease of $10 to $15 billion of the current $85 billion, Wall Street money-grubbers were spooked as usual at the suggestion that money would be anything other than nearly free to borrow.
Today's action in stocks shows just how fragile the 4 1/2-year-plus market rally is and how quickly paper profits may vanish if the Fed doesn't keep the money-printing machine going pedal to the metal.
It's a ridiculous market made up of ridiculous valuations and propositions, that, without Herculean-like support from the central bank, could fall apart in days or weeks.
The Fed will no doubt taper, the only remaining questions are when and by how much. Whatever the decision shall be, markets will not like it one bit, and the general economy may suffer even more than it already has as Wall Street will no doubt throw a massive hissy fit.
When it's all done with, when the Fed stops buying bonds altogether (when will that be, 2065?), either stocks or the US dollar (and maybe both) will be worth a lot less than they are today.
Lunatic policies by the Fed will be followed in time by equally hilarious conclusions to those misguided policies. The results will be a catastrophe financial markets have never seen before.
What is either amusing or distressing is the reaction in precious metal markets, which fell in concert with stocks and bonds. If the markets are correct, Fed tapering will be a deflationary event with magnificent outcomes ahead.
In the long term, the Fed cannot taper back on bond purchases because they have succeeded in crowding out the few remaining participants over the past four years. Deflations and defaults will be the most likely results, though emerging markets will feel the pain much sooner and to a much greater degree than established economies, though no nation will be spared the death spiral of deflation.
Dow 15,900.82, -66.21 (0.41%)
Nasdaq 3,921.27, -10.28 (0.26%)
S&P 500 1,781.37, -6.50 (0.36%)
10-Yr Bond 2.79%, +0.08
NYSE Volume 3,094,246,250
Nasdaq Volume 1,686,541,875
Combined NYSE & NASDAQ Advance - Decline: 2180-3428
Combined NYSE & NASDAQ New highs - New lows: 162-98
WTI crude oil: 93.33, -0.01
Gold: 1,258.00, -15.50
Silver: 20.06, 0.276
Corn: 425.25, -1.00
Tuesday, November 19, 2013
Another Dead Day on Wall Street
Stocks simply don't seem to have any momentum, such as earnings season is pretty much over and the gala holiday shopping season is still more than a week away.
There's no catalyst in either direction, though there's the continuing, nagging questions surrounding Fed tapering and the impact of Obamacare on business and markets, both of which seem to be supplying an anchor for equities.
Few voices are calling for a correction, but even fewer are banging the table about a generalized rally in stocks, as they are perceived to be just about fairly priced or over-priced.
This is an odd circumstance, as November is usually one of the better months for investors, though one could argue that gains in stocks this year have already beaten even the most optimistic targets.
Dow 15,967.03, -8.99 (0.06%)
Nasdaq 3,931.55, -17.51 (0.44%)
S&P 500 1,787.87, -3.66 (0.20%)
10-Yr Bond 2.71%, +0.03
NYSE Volume 3,199,620,250
Nasdaq Volume 1,714,876,375
Combined NYSE & NASDAQ Advance - Decline: 1903-3715
Combined NYSE & NASDAQ New highs - New lows: 162-78
WTI crude oil: 93.34, +0.31
Gold: 1,273.50, +1.20
Silver: 20.33, +0.023
Corn: 426.25, +5.25
There's no catalyst in either direction, though there's the continuing, nagging questions surrounding Fed tapering and the impact of Obamacare on business and markets, both of which seem to be supplying an anchor for equities.
Few voices are calling for a correction, but even fewer are banging the table about a generalized rally in stocks, as they are perceived to be just about fairly priced or over-priced.
This is an odd circumstance, as November is usually one of the better months for investors, though one could argue that gains in stocks this year have already beaten even the most optimistic targets.
Dow 15,967.03, -8.99 (0.06%)
Nasdaq 3,931.55, -17.51 (0.44%)
S&P 500 1,787.87, -3.66 (0.20%)
10-Yr Bond 2.71%, +0.03
NYSE Volume 3,199,620,250
Nasdaq Volume 1,714,876,375
Combined NYSE & NASDAQ Advance - Decline: 1903-3715
Combined NYSE & NASDAQ New highs - New lows: 162-78
WTI crude oil: 93.34, +0.31
Gold: 1,273.50, +1.20
Silver: 20.33, +0.023
Corn: 426.25, +5.25
Monday, November 18, 2013
Stocks Drop on Carl Icahn Comments?
So, is Carl Icahn the modern-day version of legendary investor J.P. Morgan, upon whose words - as legend has it - hung the fate of stocks and the economy?
Doubtful. Icahn may have a high opinion of himself, but he's probably not as influential as the TV-commercial version of E.F. Hutton, the company which used the tag line, "When E.F. Hutton talks, people listen."
Whatever the case, after Icahn made remarks at an investment conference today, saying he was "very cautious," stocks took an immediate nosedive, sending the Dow into negative territory after gaining as many as 68 points earlier in the session.
More likely, Icahn was the scapegoat du jour, giving cover to a well-planned exit by heavy holders in kay equities.
Markets don't need excuses to move one way or the other, or even to do nothing, but, in the age of instant communications, instant causation is expected, though it is almost never on the mark.
Icahn is no financial genius. Anyone with two eyes can see that stocks are priced nearly to perfection and ripe for a correction, though guessing ahead on that assumption, as has been well-learned over the past five years, can be a costly maneuver.
Stocks, as J.P. Morgan once said when pressed for direction, "will fluctuate."
And that's exactly what they did today.
Dow 15,976.02, +14.32 (0.09%)
Nasdaq 3,949.07, -36.90 (0.93%)
S&P 500 1,791.53, -6.65 (0.37%)
10-Yr Bond 2.68%, -0.03
NYSE Volume 3,152,413,250
Nasdaq Volume 1,793,143,750
Combined NYSE & NASDAQ Advance - Decline: 2127-3522
Combined NYSE & NASDAQ New highs - New lows: 496-45
WTI crude oil: 93.03, -0.81
Gold: 1,272.30, -15.10
Silver: 20.36, -0.41
Corn: 421.00, -9.50 (new low)
Doubtful. Icahn may have a high opinion of himself, but he's probably not as influential as the TV-commercial version of E.F. Hutton, the company which used the tag line, "When E.F. Hutton talks, people listen."
Whatever the case, after Icahn made remarks at an investment conference today, saying he was "very cautious," stocks took an immediate nosedive, sending the Dow into negative territory after gaining as many as 68 points earlier in the session.
More likely, Icahn was the scapegoat du jour, giving cover to a well-planned exit by heavy holders in kay equities.
Markets don't need excuses to move one way or the other, or even to do nothing, but, in the age of instant communications, instant causation is expected, though it is almost never on the mark.
Icahn is no financial genius. Anyone with two eyes can see that stocks are priced nearly to perfection and ripe for a correction, though guessing ahead on that assumption, as has been well-learned over the past five years, can be a costly maneuver.
Stocks, as J.P. Morgan once said when pressed for direction, "will fluctuate."
And that's exactly what they did today.
Dow 15,976.02, +14.32 (0.09%)
Nasdaq 3,949.07, -36.90 (0.93%)
S&P 500 1,791.53, -6.65 (0.37%)
10-Yr Bond 2.68%, -0.03
NYSE Volume 3,152,413,250
Nasdaq Volume 1,793,143,750
Combined NYSE & NASDAQ Advance - Decline: 2127-3522
Combined NYSE & NASDAQ New highs - New lows: 496-45
WTI crude oil: 93.03, -0.81
Gold: 1,272.30, -15.10
Silver: 20.36, -0.41
Corn: 421.00, -9.50 (new low)
Thursday, November 14, 2013
New Record Highs for Dow, S&P on Yellen Lovve-Fest Hearings
Wall Street has shown its liking for incoming Fed Chairman Yellen, so the congress better damn well approve him.
Dow 15,876.22, +54.59 (0.35%)
S&P 500 1,790.62, +8.62 (0.48%)
Nasdaq, 3,972.74, +7.16 (0.18%)
10-Year Note 2.70, -0.02
Combined NYSE & NASDAQ Advance - Decline: 3205-2398
Combined NYSE & NASDAQ New highs - New lows: 423-63
WTI crude oil: 93.76, -0.12
Gold: 1,286.30, +17.90
Silver: 20.72, +0.28
Corn: 426.50, -3.25
Dow 15,876.22, +54.59 (0.35%)
S&P 500 1,790.62, +8.62 (0.48%)
Nasdaq, 3,972.74, +7.16 (0.18%)
10-Year Note 2.70, -0.02
Combined NYSE & NASDAQ Advance - Decline: 3205-2398
Combined NYSE & NASDAQ New highs - New lows: 423-63
WTI crude oil: 93.76, -0.12
Gold: 1,286.30, +17.90
Silver: 20.72, +0.28
Corn: 426.50, -3.25
Wednesday, November 13, 2013
Stocks Rock; Yellen Ready to Kiss Up to Congress
Nice gains for the Dow and S&P, which both set new all-time high closes. The party won't stop, according to sources close to Mr. Yellen, who is expected to convince congress that the Fed needs to continue manipulating markets and driving the purchasing power of the dollar into oblivion with even more intervention and easy money policies.
Life , for working Americans, could be wonderful if the Fed can figure out how to induce any kind of wage inflation.
We are a hopeful nation.
Dow 15,821.63, +70.96 (0.45%)
S&P 1,782.00, +14.31 (0.81%)
Nasdaq 3,965.58, +45.66 (1.16%
10-Year Note: 2.68%, -0.05 (-1.83%)
NYSE Volume: 3,320,000
NASDAQ Volume: 1,769,363,821
Combined NYSE & NASDAQ Advance - Decline: 3777-1858
Combined NYSE & NASDAQ New highs - New lows: 323-93
WTI crude oil: 93.88, +0.84
Gold: 1,268.40, -2.80, -0.336
Silver: 429.75, -2.50
Life , for working Americans, could be wonderful if the Fed can figure out how to induce any kind of wage inflation.
We are a hopeful nation.
Dow 15,821.63, +70.96 (0.45%)
S&P 1,782.00, +14.31 (0.81%)
Nasdaq 3,965.58, +45.66 (1.16%
10-Year Note: 2.68%, -0.05 (-1.83%)
NYSE Volume: 3,320,000
NASDAQ Volume: 1,769,363,821
Combined NYSE & NASDAQ Advance - Decline: 3777-1858
Combined NYSE & NASDAQ New highs - New lows: 323-93
WTI crude oil: 93.88, +0.84
Gold: 1,268.40, -2.80, -0.336
Silver: 429.75, -2.50
Monday, November 11, 2013
Stocks Little Changed on Veteran's Day
With bond markets closed and many traders enjoying a three-day weekend by virtue of the Veteran's Day holiday, there was little to get excited about in equity markets or elsewhere.
The day's smallish gains were led by Consumer Cyclicals, Healthcare and Technology, counterbalanced by downside moves in Basic Materials and Telecoms, which lagged the market.
Volume was noticeably in short supply as was volatility, reverting back to levels seen this past summer. Despite the lack of interest, the Dow Jones Industrial Average closed at a new all-time high, with the NASDAQ and S&P sporting smaller gains.
New highs continued to outnumber new lows, though not as substantially as in recent weeks. The advance-decline line was nearly static, with winners beating losers by less than a hundred issues.
Commodities were largely flat-lining, though corn got a bit of a bid off recent 52-week lows.
Unless there's some earth-shaking development on Tuesday, tomorrow could be just as listless, as there are no meaningful economic data releases until Wednesday, and even then, those are hardly impacting.
Dow 15,783.10, +21.32 (0.14%)
Nasdaq 3,919.79, +1.67 (0.04%)
S&P 500 1,771.89, +1.28 (0.07%)
10-Yr Bond 2.75% 0.00
NYSE Volume 2,507,799,000
Nasdaq Volume 1,538,911,625
Combined NYSE & NASDAQ Advance - Decline: 2840-2754
Combined NYSE & NASDAQ New highs - New lows: 238-56
WTI crude oil: 95.14, +0.54
Gold: 1,281.10, -3.50
Silver: 21.28, -0.035
Corn: 434.75, +8.00
The day's smallish gains were led by Consumer Cyclicals, Healthcare and Technology, counterbalanced by downside moves in Basic Materials and Telecoms, which lagged the market.
Volume was noticeably in short supply as was volatility, reverting back to levels seen this past summer. Despite the lack of interest, the Dow Jones Industrial Average closed at a new all-time high, with the NASDAQ and S&P sporting smaller gains.
New highs continued to outnumber new lows, though not as substantially as in recent weeks. The advance-decline line was nearly static, with winners beating losers by less than a hundred issues.
Commodities were largely flat-lining, though corn got a bit of a bid off recent 52-week lows.
Unless there's some earth-shaking development on Tuesday, tomorrow could be just as listless, as there are no meaningful economic data releases until Wednesday, and even then, those are hardly impacting.
Dow 15,783.10, +21.32 (0.14%)
Nasdaq 3,919.79, +1.67 (0.04%)
S&P 500 1,771.89, +1.28 (0.07%)
10-Yr Bond 2.75% 0.00
NYSE Volume 2,507,799,000
Nasdaq Volume 1,538,911,625
Combined NYSE & NASDAQ Advance - Decline: 2840-2754
Combined NYSE & NASDAQ New highs - New lows: 238-56
WTI crude oil: 95.14, +0.54
Gold: 1,281.10, -3.50
Silver: 21.28, -0.035
Corn: 434.75, +8.00
Friday, November 8, 2013
Green Arrows for Stocks as Non-Farm Payrolls Surprise
As the work-week ended, everything was up, except, of course, gold and silver, because we just can't have those ancient relics of real money ruining the fiat-fest currently underway.
After the government reported October non-farm payrolls up a shocking 204,000 in October and revised August and September reports upward as well, futures slid, in sympathy with the idea that the Fed would - due to the "strong" jobs figure - reconsider its $85 billion-a-month bond-buying binge and begin to taper such efforts.
However, once the markets opened, good news was once again good news, and stocks staged a massive rally, erasing all of the prior day's losses on the major indices, sending the Dow Industrials to another record close.
Mortgage rates rocketed higher on the news, as did treasuries, the 10-year note ripping upward by 13 bips.
The logic may be a bit twisted - then again, what, concerning Wall Street and our current "crisis management" economy isn't? - but here's the take: Sure, the effects of the government shutdown the first two weeks of October were minimized, and the economy was creating jobs, but the unemployment rate actually rose - from 7.2 to 7.3% - due to a decline in the labor force participation rate, which has steadily trended downward for the past decade, making what looked, on the surface, as good news, actually bad news for the economy, which is good news for stocks because the Fed will just keep buying up treasuries and MBS, sloshing even more cheap money into the already liquidity-bloated system.
As usual, bankers and their kindred traders, hedgies and speculators were the main beneficiaries, after selling yesterday on a move that suggests the payroll data was privately leaked, were able to buy on the cheap Friday morning.
That's about the only analysis that makes any sense, though rational, logical arguments aren't always adequate predictors of market economics and trading patterns.
The guys with the inside scoop always do better than Mr. and Mrs. Average Joe and Jane. And they do it every day, whether the market is up or down, because they own the data.
Dow 15,761.78, +167.80 (1.08%)
Nasdaq 3,919.23, +61.90 (1.60%)
S&P 500 1,770.61, +23.46 (1.34%)
10-Yr Bond 2.75%, +0.13
NYSE Volume 3,770,251,500
Nasdaq Volume 1,934,757,875
Combined NYSE & NASDAQ Advance - Decline: 3706-1971
Combined NYSE & NASDAQ New highs - New lows: 231-99
WTI crude oil: 94.60, +0.40
Gold: 1,284.60, -23.90
Silver: 21.32, -0.34
Corn: 426.75, +6.25
After the government reported October non-farm payrolls up a shocking 204,000 in October and revised August and September reports upward as well, futures slid, in sympathy with the idea that the Fed would - due to the "strong" jobs figure - reconsider its $85 billion-a-month bond-buying binge and begin to taper such efforts.
However, once the markets opened, good news was once again good news, and stocks staged a massive rally, erasing all of the prior day's losses on the major indices, sending the Dow Industrials to another record close.
Mortgage rates rocketed higher on the news, as did treasuries, the 10-year note ripping upward by 13 bips.
The logic may be a bit twisted - then again, what, concerning Wall Street and our current "crisis management" economy isn't? - but here's the take: Sure, the effects of the government shutdown the first two weeks of October were minimized, and the economy was creating jobs, but the unemployment rate actually rose - from 7.2 to 7.3% - due to a decline in the labor force participation rate, which has steadily trended downward for the past decade, making what looked, on the surface, as good news, actually bad news for the economy, which is good news for stocks because the Fed will just keep buying up treasuries and MBS, sloshing even more cheap money into the already liquidity-bloated system.
As usual, bankers and their kindred traders, hedgies and speculators were the main beneficiaries, after selling yesterday on a move that suggests the payroll data was privately leaked, were able to buy on the cheap Friday morning.
That's about the only analysis that makes any sense, though rational, logical arguments aren't always adequate predictors of market economics and trading patterns.
The guys with the inside scoop always do better than Mr. and Mrs. Average Joe and Jane. And they do it every day, whether the market is up or down, because they own the data.
Dow 15,761.78, +167.80 (1.08%)
Nasdaq 3,919.23, +61.90 (1.60%)
S&P 500 1,770.61, +23.46 (1.34%)
10-Yr Bond 2.75%, +0.13
NYSE Volume 3,770,251,500
Nasdaq Volume 1,934,757,875
Combined NYSE & NASDAQ Advance - Decline: 3706-1971
Combined NYSE & NASDAQ New highs - New lows: 231-99
WTI crude oil: 94.60, +0.40
Gold: 1,284.60, -23.90
Silver: 21.32, -0.34
Corn: 426.75, +6.25
Thursday, November 7, 2013
Wall Street Pouts Despite Twitter IPO; Jobs Data on Deck
Busy day today for the gods of greed, buyers of bluster, falcons of fraud, purveyors of prevarication.
Wall Street was all a-twitter over the IPO of Twitter (TWTR), the latest Web 2.0 mega-fad company gone public, which opened today on the NYSE with a bang. The stock was issued at 26, but opened at 44, quickly ramped up above 50 per share and closed at 44.90, good for a 78% gain. The company - based on "tweets" of 140 characters - is valued at about 29 times sales, pretty rich, especially for a enterprise that's still losing money. Well, at least the founders are now billionaires... on paper.
Prior to the opening bell, there was a flurry of activity from across the Atlantic pond, as Europe's Mario Draghi, ECB president extraordinaire, announced key rate cuts of 25 basis points, leaving the base rate at .25 and the key lending rate at .50. Observers in America wondered what took the Euros so long, though one must consider that they have been in the business of wrecking their own economies and fleecing the public a lot longer than their American counterparts, so they can kick the old can-can a lot longer and down an even shorter road without causing much of a stir.
The response from traders across the continent and in the UK was resoundingly mixed, with the German DAX higher, Britain's FTSE lower and the French CAC-40 barely changed. Don't these people understand the concept of cheap money? Pikers, the lot of them, except, of course, for the stodgy, stingy, and oh-so-proper Germans.
At 8:30 am ET, the US blasted off a couple of economic indicators, releasing the first reading on third quarter GDP at a robust 2.8%, a ribald lie if ever there was one, but enough to scare the few remaining hairs off the head of Lloyd Blankfien and others of his balding ilk. Good news is once again bad news, it appears, and any growth approaching three percent in the US sends shivers up the spineless bankers' backs, because they believe their buddies, Mr. Bernanke and the incoming Mr. Yellen, may cease the easy money programs that has catapulted every dishonest banker into ever-higher tax brackets.
The most recent initial unemployment claims - which were down 9,000 from the previous week, at 336,000, remained stubbornly high, though apparently not quite high enough for the barons of buyouts. These dopes saw this as another sign of a strengthening US economy, so, shortly after the opening bell, stocks did an abrupt about-face and trended lower throughout the session, with little respite.
In other news, Goldman Sachs is under investigation for rigging foreign exchange (FOREX) trading and just about everything else they do, and, yesterday, the Blackstone Group began pitching its rent-backed securities.
Really. They did. And some people actually bought them.
The advance-decline line cratered, with losers leading gainers by a 7:2 ratio, and new lows continue to close the gap on daily new highs, a trend metric that may just flip over if today's losses are indeed presaging something un-funny about tomorrow's delayed October non-farm jobs data, due out an hour before the opening bell. The way to read this is that the government is likely to report that something in the range of 120-150,000 new jobs were created during the month, which would be more proof of economic improvement, exactly what the market doesn't want. Either that, or it's going to be a real stink-bomb, because the forecast is only for 100,000.
Business as usual, my friends. Monkey business, that is.
Dow 15,593.98, -152.90 (0.97%)
Nasdaq 3,857.33, -74.61 (1.90%)
S&P 500 1,747.15, -23.34 (1.32%)
10-Yr Bond 2.61%, -0.03
NYSE Volume 4,092,416,000
Nasdaq Volume 2,196,542,750
Combined NYSE & NASDAQ Advance - Decline: 1276-4371
Combined NYSE & NASDAQ New highs - New lows: 197-101
WTI crude oil: 94.20, -0.60
Gold: 1,308.50, -9.30
Silver: 21.66, -0.111
Corn: 420.50, -0.75
Wall Street was all a-twitter over the IPO of Twitter (TWTR), the latest Web 2.0 mega-fad company gone public, which opened today on the NYSE with a bang. The stock was issued at 26, but opened at 44, quickly ramped up above 50 per share and closed at 44.90, good for a 78% gain. The company - based on "tweets" of 140 characters - is valued at about 29 times sales, pretty rich, especially for a enterprise that's still losing money. Well, at least the founders are now billionaires... on paper.
Prior to the opening bell, there was a flurry of activity from across the Atlantic pond, as Europe's Mario Draghi, ECB president extraordinaire, announced key rate cuts of 25 basis points, leaving the base rate at .25 and the key lending rate at .50. Observers in America wondered what took the Euros so long, though one must consider that they have been in the business of wrecking their own economies and fleecing the public a lot longer than their American counterparts, so they can kick the old can-can a lot longer and down an even shorter road without causing much of a stir.
The response from traders across the continent and in the UK was resoundingly mixed, with the German DAX higher, Britain's FTSE lower and the French CAC-40 barely changed. Don't these people understand the concept of cheap money? Pikers, the lot of them, except, of course, for the stodgy, stingy, and oh-so-proper Germans.
At 8:30 am ET, the US blasted off a couple of economic indicators, releasing the first reading on third quarter GDP at a robust 2.8%, a ribald lie if ever there was one, but enough to scare the few remaining hairs off the head of Lloyd Blankfien and others of his balding ilk. Good news is once again bad news, it appears, and any growth approaching three percent in the US sends shivers up the spineless bankers' backs, because they believe their buddies, Mr. Bernanke and the incoming Mr. Yellen, may cease the easy money programs that has catapulted every dishonest banker into ever-higher tax brackets.
The most recent initial unemployment claims - which were down 9,000 from the previous week, at 336,000, remained stubbornly high, though apparently not quite high enough for the barons of buyouts. These dopes saw this as another sign of a strengthening US economy, so, shortly after the opening bell, stocks did an abrupt about-face and trended lower throughout the session, with little respite.
In other news, Goldman Sachs is under investigation for rigging foreign exchange (FOREX) trading and just about everything else they do, and, yesterday, the Blackstone Group began pitching its rent-backed securities.
Really. They did. And some people actually bought them.
The advance-decline line cratered, with losers leading gainers by a 7:2 ratio, and new lows continue to close the gap on daily new highs, a trend metric that may just flip over if today's losses are indeed presaging something un-funny about tomorrow's delayed October non-farm jobs data, due out an hour before the opening bell. The way to read this is that the government is likely to report that something in the range of 120-150,000 new jobs were created during the month, which would be more proof of economic improvement, exactly what the market doesn't want. Either that, or it's going to be a real stink-bomb, because the forecast is only for 100,000.
Business as usual, my friends. Monkey business, that is.
Dow 15,593.98, -152.90 (0.97%)
Nasdaq 3,857.33, -74.61 (1.90%)
S&P 500 1,747.15, -23.34 (1.32%)
10-Yr Bond 2.61%, -0.03
NYSE Volume 4,092,416,000
Nasdaq Volume 2,196,542,750
Combined NYSE & NASDAQ Advance - Decline: 1276-4371
Combined NYSE & NASDAQ New highs - New lows: 197-101
WTI crude oil: 94.20, -0.60
Gold: 1,308.50, -9.30
Silver: 21.66, -0.111
Corn: 420.50, -0.75
Wednesday, November 6, 2013
Wall Street Weirdness as Dow Makes New Record, NASDAQ Falls
Maybe it's the weather, but investor taste for speculation may be turning, just a day before the hoopla over the Twitter IPO is set to take place. The 142-character internet darling will open tomorrow at a very overpriced $27-30 per share. It could be that some big players in the tech investing (gambling) space just freed up money to get into the hottest IPO since... um, Facebook, though the memory of that magnificent failure is still fresh.
Still, winners just barely edged losers on the day, while the place to be in Dow stocks was in Chevron (CVX), IBM (IBM) and Microsoft (MSFT), an odd grouping there.
The MBA Mortgage Index slumped sadly prior to the open, with weekly applications off seven percent, even as 30-year rates fell to 4.32%.
Crude inventories showed only a modest uptick, which helped oil stage a rally off of five-month lows.
With bond yields settling lower, gold and silver up moderately, it was very tough to get a read on the overall market. Corn made fresh 52-week lows, which is bearish for beef, but bullish for carnivores in general, with beef prices stable and possibly set to decline. Overall, however, falling corn prices is about as good a deflation indicator as one can find, especially priced in silver.
Steady as she goes, though, especially on those safety plays in the Dow, which should consider to out-perform in a flight to dividend comfort.
Tweet that.
Dow 15,746.88, +128.66 (0.82%)
Nasdaq 3,931.95, -7.92 (0.20%)
S&P 500 1,770.49, +7.52 (0.43%)
10-Yr Bond 2.64%, -0.02
NYSE Volume 3,298,818,000
Nasdaq Volume 1,989,898,000
Combined NYSE & NASDAQ Advance - Decline: 2851-2753
Combined NYSE & NASDAQ New highs - New lows: 317-79
WTI crude oil: 94.80, +1.43
Gold: 1,317.80, +9.70
Silver: 21.77, +0.132
Corn: 421.25, -3.75
Still, winners just barely edged losers on the day, while the place to be in Dow stocks was in Chevron (CVX), IBM (IBM) and Microsoft (MSFT), an odd grouping there.
The MBA Mortgage Index slumped sadly prior to the open, with weekly applications off seven percent, even as 30-year rates fell to 4.32%.
Crude inventories showed only a modest uptick, which helped oil stage a rally off of five-month lows.
With bond yields settling lower, gold and silver up moderately, it was very tough to get a read on the overall market. Corn made fresh 52-week lows, which is bearish for beef, but bullish for carnivores in general, with beef prices stable and possibly set to decline. Overall, however, falling corn prices is about as good a deflation indicator as one can find, especially priced in silver.
Steady as she goes, though, especially on those safety plays in the Dow, which should consider to out-perform in a flight to dividend comfort.
Tweet that.
Dow 15,746.88, +128.66 (0.82%)
Nasdaq 3,931.95, -7.92 (0.20%)
S&P 500 1,770.49, +7.52 (0.43%)
10-Yr Bond 2.64%, -0.02
NYSE Volume 3,298,818,000
Nasdaq Volume 1,989,898,000
Combined NYSE & NASDAQ Advance - Decline: 2851-2753
Combined NYSE & NASDAQ New highs - New lows: 317-79
WTI crude oil: 94.80, +1.43
Gold: 1,317.80, +9.70
Silver: 21.77, +0.132
Corn: 421.25, -3.75
Tuesday, November 5, 2013
Stocks Split in Sloppy Session; Bond Yields Rising, Oil Sliding
Stocks slid at the opening bell, with the Dow down by as many as 117 points in the first half hour of trading, but quickly reversed direction at 10:00 am EST and continued a slow but steady gain the rest of the day.
Apparently, what turned stocks around was the October ISM Services reading, which came in at a solid 55.4, a full pint better than last month's data and a huge beat to the expected 54.0.
While questions concerning the veracity of these kinds of reports after the unusually-strong Chicago PMI data a week ago continue to swirl around, the beat on services - which is now the main production engine of the US, since we've hollowed out our manufacturing core and mostly export inflation - was enough for the Wall Street crowd to lift stocks off their lows.
That they were able to keep buying interest maintained for the remainder of the session was likely due to the usual POMO injection by the Fed, allowing for rampant speculation and unusually-high leverage.
While stocks were seeing the light of day - though the NASDAQ never quite made it into positive territory, bonds were getting slammed, up six bips in yield by the end of the day, as the gains following the end of the government shutdown are gradually being eroded. The closing level of 2.66% on the 10-year note was the highest in two-and-a-half weeks.
The big story happens to be in oil, which continues its retreat from $110/barrel highs just two months ago. Another $5.00 drop in the price of WTI will put oil into a bear market, a condition nobody has considered. While low oil prices relate positively to gas at the pump and is a boost for the economy, releasing more purchasing power, the underlying causes may be more nefarious and significant.
There is, at last, a supply-demand condition that is positive for the US, as more and more oil is being produced in North America, at the same time that demand is dwindling, or rather, has been dwindling for the past three to four years. Americans have tightened their collective belts and are much more careful about their driving habits these days, as lowered incomes have left less for transportation expenses. High unemployment also pays a part, as fewer people are driving to work five or six days a week.
So, while a period of lower gas prices is cause for celebration, the party may not be of the epic variety, with fewer participants and an overhang of disappointing economic circumstances.
Key numbers to watch tomorrow will be the MBA Mortgage Index (7:00 am), September Leading Indicators (10:00 am) and crude inventories (10:30 am).
Dow 15,618.22, -20.90 (0.13%)
Nasdaq 3,939.86, +3.27 (0.08%)
S&P 500 1,762.97, -4.96 (0.28%)
10-Yr Bond 2.66%, +0.06
NYSE Volume 3,485,473,500
Nasdaq Volume 1,899,388,750
Combined NYSE & NASDAQ Advance - Decline: 2064-3571
Combined NYSE & NASDAQ New highs - New lows: 248-74
WTI crude oil: 93.37, -1.25
Gold: 1,308.10, -6.60
Silver: 21.64, 0.064
Corn: 425.00, -1.25
Apparently, what turned stocks around was the October ISM Services reading, which came in at a solid 55.4, a full pint better than last month's data and a huge beat to the expected 54.0.
While questions concerning the veracity of these kinds of reports after the unusually-strong Chicago PMI data a week ago continue to swirl around, the beat on services - which is now the main production engine of the US, since we've hollowed out our manufacturing core and mostly export inflation - was enough for the Wall Street crowd to lift stocks off their lows.
That they were able to keep buying interest maintained for the remainder of the session was likely due to the usual POMO injection by the Fed, allowing for rampant speculation and unusually-high leverage.
While stocks were seeing the light of day - though the NASDAQ never quite made it into positive territory, bonds were getting slammed, up six bips in yield by the end of the day, as the gains following the end of the government shutdown are gradually being eroded. The closing level of 2.66% on the 10-year note was the highest in two-and-a-half weeks.
The big story happens to be in oil, which continues its retreat from $110/barrel highs just two months ago. Another $5.00 drop in the price of WTI will put oil into a bear market, a condition nobody has considered. While low oil prices relate positively to gas at the pump and is a boost for the economy, releasing more purchasing power, the underlying causes may be more nefarious and significant.
There is, at last, a supply-demand condition that is positive for the US, as more and more oil is being produced in North America, at the same time that demand is dwindling, or rather, has been dwindling for the past three to four years. Americans have tightened their collective belts and are much more careful about their driving habits these days, as lowered incomes have left less for transportation expenses. High unemployment also pays a part, as fewer people are driving to work five or six days a week.
So, while a period of lower gas prices is cause for celebration, the party may not be of the epic variety, with fewer participants and an overhang of disappointing economic circumstances.
Key numbers to watch tomorrow will be the MBA Mortgage Index (7:00 am), September Leading Indicators (10:00 am) and crude inventories (10:30 am).
Dow 15,618.22, -20.90 (0.13%)
Nasdaq 3,939.86, +3.27 (0.08%)
S&P 500 1,762.97, -4.96 (0.28%)
10-Yr Bond 2.66%, +0.06
NYSE Volume 3,485,473,500
Nasdaq Volume 1,899,388,750
Combined NYSE & NASDAQ Advance - Decline: 2064-3571
Combined NYSE & NASDAQ New highs - New lows: 248-74
WTI crude oil: 93.37, -1.25
Gold: 1,308.10, -6.60
Silver: 21.64, 0.064
Corn: 425.00, -1.25
Monday, November 4, 2013
Stocks Advance in Dull Session
Really, really dull session.
Dow 15,639.12, +23.57 (0.15%)
Nasdaq 3,936.59, +14.55 (0.37%)
S&P 500 1,767.93, +6.29 (0.36%)
10-Yr Bond 2.60%, -0.02
NYSE Volume 3,188,967,750
Nasdaq Volume 1,777,975,875
Combined NYSE & NASDAQ Advance - Decline: 3720-1864
Combined NYSE & NASDAQ New highs - New lows: 245-50
WTI crude oil: 94.62, +0.01
Gold: 1,314.70, +1.50
Silver: 21.70, -0.137
Corn: 426.25, -1.00
Dow 15,639.12, +23.57 (0.15%)
Nasdaq 3,936.59, +14.55 (0.37%)
S&P 500 1,767.93, +6.29 (0.36%)
10-Yr Bond 2.60%, -0.02
NYSE Volume 3,188,967,750
Nasdaq Volume 1,777,975,875
Combined NYSE & NASDAQ Advance - Decline: 3720-1864
Combined NYSE & NASDAQ New highs - New lows: 245-50
WTI crude oil: 94.62, +0.01
Gold: 1,314.70, +1.50
Silver: 21.70, -0.137
Corn: 426.25, -1.00
Friday, November 1, 2013
Stocks Up, Commodities Down; Oil Crashing
Stocks, bonds, up. Oil, gold, silver, corn, down.
WTI crude is at its lowest level since June, down $15/barrel since early September, technically in a correction. Another 6% decline in crude (about $5.60) will put crude into a bear market, which will be great for consumers.
Economy still incredibly weak, despite close to all-time highs on major indices.
Dow 15,615.55, +69.80 (0.45%)
Nasdaq 3,922.04, +2.34 (0.06%)
S&P 500 1,761.64, +5.10 (0.29%)
10-Yr Bond 2.62%, +0.08
NYSE Volume 3,703,160,500
Nasdaq Volume 1,917,590,125
Combined NYSE & NASDAQ Advance - Decline: 2439-3166
Combined NYSE & NASDAQ New highs - New lows: 178-65 (gap closing)
WTI crude oil: 94.61, -1.77
Gold: 1,313.20, -10.50
Silver: 21.84, -0.03
Corn: 427.25, -1.00
WTI crude is at its lowest level since June, down $15/barrel since early September, technically in a correction. Another 6% decline in crude (about $5.60) will put crude into a bear market, which will be great for consumers.
Economy still incredibly weak, despite close to all-time highs on major indices.
Dow 15,615.55, +69.80 (0.45%)
Nasdaq 3,922.04, +2.34 (0.06%)
S&P 500 1,761.64, +5.10 (0.29%)
10-Yr Bond 2.62%, +0.08
NYSE Volume 3,703,160,500
Nasdaq Volume 1,917,590,125
Combined NYSE & NASDAQ Advance - Decline: 2439-3166
Combined NYSE & NASDAQ New highs - New lows: 178-65 (gap closing)
WTI crude oil: 94.61, -1.77
Gold: 1,313.20, -10.50
Silver: 21.84, -0.03
Corn: 427.25, -1.00
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