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First, a quote. Quotes are fun.
Any idea who said this?
This so-called ill treatment and torture in detention centers... … were not, as some assumed, inflicted methodically, but were excesses committed by individual prison guards, their deputies, and men who laid violent hands on the detainees.
Sounds like something that might have been said - about Abu Ghraib or Guantanomo Bay or any of the 120 concentration camps in the New American Gulag. It might have been said any of the following war criminals:
- Condoleeza "Oil Tanker" Rice;
- Donald "Aspartame" Rumsfeld; or
- George "Bin Laden Financed My Oil Companies" Bush.
But if you guessed any of those three (or even Dick "Halliburton" Cheney or John "Cover Up that Statue" Ashcroft or Richard "I Spy with My Little Eye" Perle), you would be wrong.
The quote is from Rudolf Hoess, the Kommandant of Auschwitz. Still, it's understandable that people would think a NeoCon said it; birds of a feather steal each others' lines all the time.
Federal Reserve Open Market Operations
The Fed's Open Market Operations desk performed 2 repurchase operations last night:
- a $7.25billion, overnight repurchase entirely in T-backed collateral ; and
- a $4.5billion, 7-day repurchase - again, 100% in T-backed collateral.
With that amount of dough to play with, a 10 a.m. moonshot was expected - but it never came. The post-10 a.m. high was barely a point and a half above the 10 a.m. level. When that amount of repo activity doesn't do it's job, there's something amiss.
Major US Indices
The newsflow over the past couple of days has been broadly "supportive" of a snap upwards, but the overarching reason for the move is purely technical; the single-story stuff has only helped the relative movements of the indices (the Dow having the biggest move because the drug stocks that helped generate it are present disproportionately in the Dow).
Note the teensy little ROC divergence that might be developing at the right-hand side of the Dow daily chart. This, plus the oversold %R conditions, should have made traders aware of a chance of a long-side bias for intraday positions.
Dow Daily Chart
Click on Chart to Enlarge
That said, the intraday behaviour of all the indices has not been particularly constructive: most of the entire move off the year's lows got done at the open yesterday.
The Nasdaq Comp chart is also very instructive - I mentioned 2000 as a pretty important level (more accurately, the behaviour of the market is 2000 was tested). It never really got tested, because the Comp gapped up yesterday and has followed through. But look at how deeply oversold it was - particularly check out ROC on the chart below. You don't often get ROC below -5, and that level of oversold was again a good indication to start trying long intraday positions..
Nasdaq100 Daily Chart
Click on Chart to Enlarge
The DJIA set its high at 11 a.m. almost to the minute, but two hours later was 50 points lower than its high, and spent the rest of the session meandering in a 35-point range above 10480. By the close it had advanced 37.03 points (0.35%), closing out the day at 10498.59 points; the broader S&P500 rose 5.66 points (0.48%), closing at 1174.07.
Over at Times Square, the Nasdaq Composite added 26.14 points (1.29%), to close at 2046.09, while larger-cap technology issues fared worse with the Nasdaq100 adding 18.44 points (1.24%), to end at 1509.01 points.
NYSE Volume was chunky, with 1.64 billion shares changing hands, while Nasdaq Volume was solid with 2.12 billion shares traded.
| Index | Close | Gain(Loss) | % |
| DJIA | 10498.59 | 37.03 | 0.35% |
| S&P500 | 1174.07 | 5.66 | 0.48% |
| Nasdaq Composite | 2046.09 | 26.14 | 1.29% |
| Nasdaq100 | 1509.01 | 18.44 | 1.24% |
| NYSE Volume | 1.64bn | - | - |
| Nasdaq Volume | 2.12bn | - | - |
Bellwethers
My 9-stock "bellwethers" group rose by an average of 0.46%
- Cisco Systems (CSCO) +$0.18 (1.03%) to $17.69;
- Ebay (EBAY) +$2.28 (2.85%) to $82.32;
- Citigroup (C) -$0.03 (0.06%) to $48.48;
- Wal Mart (WMT) -$0.00 (0%) to $53.28;
- IBM (IBM) -$0.24 (0.26%) to $91.95;
- General Electric (GE) -$0.21 (0.59%) to $35.49;
- Intel (INTC) +$0.16 (0.72%) to $22.42;
- Fannie Mae (FNM) +$0.50 (0.78%) to $64.81;
- Freddie Mac (FRE) -$0.22 (0.33%) to $65.65;
Market Breadth & Internals
NYSE advancing issues exceeded decliners by 2366 to 937 for a single-day A/D reading of 1429; Nasdaq gainers trumped losers by 2123 to 966. Those numbers got real hopeful, real fast.
NYSE advancing volume exceeded volume in decliners by a ratio of over 2:1. In absolute levels the score was 1099.75 to 505.38 million shares; Nasdaq advancing volume was greater than volume in decliners by 812.59 to 311.12 million shares.
56 NYSE-listed stocks rose to new 52-week highs, and 20 posted fresh 52-week lows, while on the Nasdaq there were 58 stocks that hit new 52-week highs, and 32 which fell to fresh 52-week lows
| NYSE | Nasdaq | |
| Advancers | 2366 | 2123 |
| Decliners | 937 | 966 |
| Advancing Volume (m) | 1099.75 | 812.59 |
| Declining Volume (m) | 505.38 | 311.12 |
| New Highs | 56 | 58 |
| New Lows | 20 | 32 |
Market Sentiment
[Commentary]
| Index | Close | Gain(Loss) | % |
| Equity Call Volume (000) | 2801.45 | 135.82 | 5.1% |
| Equity Put Volume (000) | 1865.31 | -112.35 | -5.68% |
| CBOE Volatility Index | 13.44 | -1.21 | -8.26% |
| CBOE Nasdaq Volatility Index | 18.92 | -0.95 | -4.78% |
| Equity Put-Call Ratio | 0.67 | -0.08 | -10.25% |
| SPX-VIX Ratio | 87.36 | 7.92 | 9.97% |
Bond Market Analysis
Bonds rose at the long end, with the yield on the benchmark 30-year Treasury bond shedding 2.2 basis points to 4.664%. The middle of the curve is starting to think a bit harder about the upcoming Fed Rate hike, but Lockheed's "3.5% Ten Year Yield" call - made some time ago - is sowing itself to be quite prophetic.
| Index | Close | Gain(Loss) | % |
| UST 13wk (yld) | 2.388 | 0 | 0.17% |
| UST 2Y (yld) | 3.252 | 0.042 | 1.31% |
| UST 5Y (yld) | 3.724 | 0.02 | 0.51% |
| UST 10Y (yld) | 4.196 | 0.002 | 0.05% |
| UST 30Y (yld) | 4.664 | -0.022 | -0.47% |
The Banks Index posted a rise of 0.29 points (0.29%), to end the session at 100.49; within the index,
- Zions Bancorp (ZION) +$2.38 (3.64%) to $67.83;
- North Fork Bancorp (NFB) +$0.85 (3.08%) to $28.42;
- Regions Financial (RF) +$0.44 (1.35%) to $33.15;
- Wells Fargo & Co (WFC) +$0.54 (0.9%) to $60.87; and
- Comerica Inc (CMA) +$0.49 (0.86%) to $57.27.
The Broker-dealer Index added 0.14 points (0.1%), ending the day at 146.13; the ticket clippers lined up as follows -
- Charles Schwab (SCH) +$0.13 (1.16%) to $11.30;
- Merrill Lynch (MER) +$0.62 (1.07%) to $58.61;
- A G Edwards (AGE) +$0.37 (0.9%) to $41.45;
- Lehman Bros (LEH) +$0.41 (0.46%) to $88.95; and
- Raymond James (RJF) +$0.13 (0.44%) to $29.97.
The Philadelphia SOX (Semiconductor) index added 10.19 points (2.61%), to 400.06
- Altera (ALTR) +$0.06 (0.33%) to $18.39;
- Texas Instruments (TXN) +$1.54 (7.29%) to $22.66;
- Infineon Tech (IFX) +$0.36 (4%) to $9.35;
- Xilinx (XLNX) +$1.00 (3.68%) to $28.16; and
- Broadcom (BRCM) +$1.04 (3.38%) to $31.83.
Gold & Silver Markets
Gold rose $4.40 (1.04%) to close at $426.5 per ounce. To me, this still looks like it could easily test $415 - just to give newcomers something to think about.
The Gold Bugs Index gained 2.01 points (1%), at 203.1
- Hecla Mining (HL) +$0.20 (3.68%) to $5.64;
- Meridian Gold (MDG) +$0.59 (3.21%) to $18.96;
- Eldorado Gold (EGO) +$0.05 (1.89%) to $2.69;
- Coeur d'Alene (CDE) +$0.06 (1.64%) to $3.72; and
- Golden Star (GSS) +$0.06 (1.64%) to $3.72.
Silver rose $0.12 (1.72%) to close at $6.8 per ounce. The Gold and Silver Index (XAU) gained 0.74 points (0.81%), at 92.5 points.
- Meridian Gold (MDG) +$0.59 (3.21%) to $18.96;
- Durban Roodepoert Deep (DROOY) +$0.02 (1.5%) to $1.35;
- Placer Dome (PDG) +$0.23 (1.33%) to $17.57; and
- Anglogold Ashanti (AU) +$0.42 (1.31%) to $32.46.
| Index | Close | Gain(Loss) | % |
| Gold | 426.5 | 4.4 | 1.04% |
| Silver | 6.8 | 0.115 | 1.72% |
| PHLX Gold and Silver Index | 92.5 | -1.78 | -1.89% |
| AMEX Gold BUGS Index | 203.1 | -4.78 | -2.3% |
Oil Market
Oil lost ground, shedding $0.59 per barrel, closing at $49.05 per barrel. The Oil and Gas Index (XOI) gained 7.59 points (1.04%), to 737.44
- BP (BP) +$1.22 (2.08%) to $59.90;
- Sunoco (SUN) +$1.62 (1.94%) to $85.32; and
- ConocoPhillips (COP) +$1.59 (1.79%) to $90.49.
- Tidewater Inc (TDW) +$0.46 (1.24%) to $37.65;
- Nabors Industries (NBR) +$0.52 (1.05%) to $50.19;
- Weatherford (WFT) +$0.53 (1%) to $53.78;
| Index | Close | Gain(Loss) | % |
| Reuters CRB | 286.75 | 2.00 | 0.7% |
| Crude Oil Light Sweet | 49.05 | -0.59 | -1.19% |
| AMEX Oil Index | 737.44 | 9.8 | 1.35% |
| Oil Service Index | 128.51 | 1.32 | 1.04% |
Currency Markets
The Euro dipped pretty hard over the last couple of days, hitting 1.2975. Even in the face of that level of Euro weakness, the USDX has not managed to recruit enough converts to its cause. It is going to take some far more flagrant manipulation to get the bounce happening, so the guys trading EC and USDX on behalf of the US Treasury had better decloak and really get stuck in.
| Index | Close | Gain(Loss) | % |
| US Dollar Index | 83.38 | -0.69 | -0.82% |
| Euro | 1.3069 | 0.0099 | 0.76% |
| Yen | 103.1 | -0.94 | -0.9% |
| Sterling | 1.8823 | 0.0185 | 0.99% |
| Australian Dollar | 0.7747 | 0.0098 | 1.28% |
| Swiss Franc | 1.1836 | -0.0093 | -0.78% |
| Canadian Dollar | 0.8105 | 0.0015 | 0.19% |
European Markets
France's benchmark CAC-40 Index dipped 2.22 points (0.06%), to end the session at 3879.82; the German DAX-30 Index slid 19.83 points (0.47%), to end the session at 4214.12 points, and in the UK, the FTSE-100 Index gained 3.9 points. (0.08%), to 4847.1
| Index | Close | Gain(Loss) | % |
| CAC-40 | 3879.82 | -2.22 | -0.06% |
| DAX-30 | 4214.12 | -19.83 | -0.47% |
| FTSE-100 | 4847.1 | 3.9 | 0.08% |
Tomorrow's Pivots (US Futures Market)
| Dow | S&P500 | Nasdaq | Bonds | |
| R2 | 10548 | 1179.4 | 1527.17 | 114 13/32 |
| R1 | 10517 | 1176.2 | 1516.83 | 114 6/32 |
| Pivot | 10496 | 1173.5 | 1507.67 | 114 |
| S1 | 10465 | 1170.3 | 1497.33 | 113 25/32 |
| S2 | 10444 | 1167.6 | 1488.17 | 113 19/32 |
