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Mondays
are dreaded by huge chunks of humanity - it means the end of the
weekend, the return to the grind of wage-slavery (or to school, which
is worse because in the modern State system it's like having your mind
filled with porridge by a failure). Recently the markets have loved
Mondays; any skittishness that happens on Fridays dissipates (as long
as nothing blows up) and everyone enters the market on Monday morning
with a Stimpy-grin on their faces, singing "Happy Happy Happy, Joy Joy
Joy". Of course it always helps when the (privately owned, for-profit) Federal Reserve
lines the palms of its owners with the rocket-fuel of credit...
Federal Reserve Open Market Operations
The Fed's Open
Market Operations desk performed
a single repurchase operation - a $7billion, overnight repurchase
entirely in T-backed collateral. True to form, the indices had a little
spurt starting just after 10 a.m. NY time, but the spurt was less than
impressive. The market had to wait until 2 p.m. for a genuine burst -
after wandering around 10500 like a lost sheep, the Dow finally managed
to leave that level behind and get through 10550. Interestingly, the
Dow didn't manage to close
above 10550.
Major US Indices
The Dow
Jones Industrial Average added
51.65 points (0.49%), closing out the day at 10523.56 points. The index
hit an intraday high of 10560.81 just after 3 p.m. NY time, after
opening with a teensy bump downward to 10466.07 points. The supposed
catalyst for the rise was the stock-pimps touting the fact that Apple
has finally decided to use Intel
chips - after 2 decades of trying to do things a different way. The
penguin logic on this, is that it will lead to lower prices for
next-generation Apple machines. Whoop-de-doo... it really isn't any big
deal, but on a no-news day it was enough to get the exuberance juices
flowing.
Within the blue-chip index, 21 stocks rose, the biggest gainers being United Technology (UTX, +2.37% to $107.64) and 3M (MMM, +1.91% to $78.53), which accounted for 29 Dow points between them. Losers in the Dow numbered 8 and were led by General Motors (GM, -1.18% to $32.59) and Walt Disney (DIS, -1.01% to $27.55), with these two stocks contributing -5 Dow points worth of downward pressure on the index. Volume traded was tilted in favour of the gainers by 281.5m shares to 52.3m.
The broader S&P500 gained 4.58 points (0.39%), closing at 1193.86. Within the index, gainers numbered 325, while 168 S&P500 stocks fell for the day. Volume was tilted 2.1:1 in favour of the winners with 1.09 billion units traded in the winners, handily thrashing the 515.92 million shares traded in the losers .
Over at Times Square, the Nasdaq Composite advanced 10.23 points (0.5%), to close at 2056.65, while larger-cap technology issues underperformed slightly with the Nasdaq100 adding 7.16 points (0.47%), to end at 1535.22 points. Within the tech benchmark, gainers numbered 53, while 45 Nasdaq100 stocks fell for the day. Volume was tilted 2.5:1 in favour of the winners with 518.20 million traded in the winners compared to 205.12 million in the losers .
NYSE Volume was only solid rather than spectacular, with 1.67 billion shares changing hands. Nasdaq Volume was also pretty ordinary - on the high side of the average, but nothing to get gooey about at 1.68 billion shares.
| Major Market Statistics | |||
| Index | Close | Gain(Loss) | % |
| Dow Jones Industrial Average | 10523.56 | 51.65 | 0.49% |
| S&P500 | 1193.86 | 4.58 | 0.39% |
| Nasdaq Composite | 2056.65 | 10.23 | 0.5% |
| Nasdaq100 | 1535.22 | 7.16 | 0.47% |
| NYSE Volume | 1.67bn | - | - |
| Nasdaq Volume | 1.68bn | - | - |
Bellwethers
My 9-stock "bellwethers" group rose by an average of 0.63%
- General Electric (GE) +$0.18 (0.49%) to $37.18;
- Citigroup (C) -$0.20 (0.42%) to $47.60;
- Wal Mart (WMT) +$0.67 (1.42%) to $47.85;
- I.B.M. (IBM) +$0.10 (0.13%) to $76.51;
- Intel (INTC) +$0.15 (0.57%) to $26.50;
- Cisco Systems (CSCO) +$0.08 (0.41%) to $19.55;
- eBay (EBAY) +$0.55 (1.5%) to $37.11;
- Fannie Mae (FNM) +$0.68 (1.2%) to $57.40; and
- Freddie Mac (FRE) +$0.24 (0.37%) to $64.52.
Market Breadth & Internals
NYSE advancing Issues exceeded decliners by 2104 to 1180 for a single-day A/D reading of 924; Nasdaq gainers trumped losers by 1673 to 1391. The 10-day moving average of the A/D line rose to 581.2 on the NYSE, while the 10dma of the Nasdaq A/D rose to 259.2.
NYSE advancing volume exceeded volume in decliners by 1115.1 to 514.4 million shares; Nasdaq advancing volume was greater than volume in decliners by 1084.2 to 518 million shares.
102 NYSE-listed stocks rose to new 52-week highs, and 12 posted fresh 52-week lows, while on the Nasdaq there were 81 stocks that hit new 52-week highs, and 32 which fell to fresh 52-week lows.
| Market Breadth Statistics | ||
| NYSE | Nasdaq | |
| Advancers | 2104 | 1673 |
| Decliners | 1180 | 1391 |
| Advancing Volume (m) | 1115.09 | 1084.21 |
| Declining Volume (m) | 514.39 | 517.99 |
| New Highs | 102 | 81 |
| New Lows | 12 | 32 |
| Market Sentiment Statistics | |||
| Index | Close | Gain(Loss) | % |
| CBOE Volatility Index | 12.95 | -0.19 | -1.45% |
| CBOE Nasdaq Volatility Index | 16.04 | 0.16 | 1.01% |
| Equity Put-Call Ratio | 0.68 | 0.01 | 1.49% |
| 10-day PCR | 0.69 | 0 | -0.19% |
| SPX-VIX Ratio | 92.2 | 1.68 | 1.86% |
Bond Market Analysis
Bonds rose at the long end,
with the yield on the benchmark 30-year
Treasury bond shedding 5.1 bps
to 4.387%. The 30-year bond future rose over a point from its session
low (115 & 23/32) in a burst that added 31/32 in less
than 40 minutes after the opening of the bond market. From there the
bond managed to eke out a new session high (at 116 & 28/32)
before softening a little to close at 116 & 22/32. There was no
news whatsoever to give the bond market such legs - there was a little
more sabre-rattling with regard to slapping trade sanctions on China,
but that really ought to hurt Treasuries
if anybody stops to think about it.
The middle of the yield curve was broadly higher: five year yields fell to 3.824%, and ten-year yields fell to 4.072%.
Spreads between short-dated (2-yr) Treasuries and high-grade corporate bonds of similar maturity profiles were 3.0 bps wider at 11.0 basis points; spreads between longer dated Treasuries and their corporate AAA counterparts rose to 61.0 bps for 10-year AAA, and 95.0 bps for 20-years.
Credit
spreads (spreads between
corporate bonds of the same maturity profile but different
creditworthiness) were broadly wider with the AAA-A spread on 20-years
6.0 bps tighter at 43.0 basis points and the 10-year AAA-A spread 8.0
bps tighter at negative 3.0
bps. So you get penalised
for having a higher credit rating at the 10-year duration. That's
whackery.
| Treasury Yields | |||
| Index | Close | Gain(Loss) | % |
| UST 13wk (yld) | 2.845 | 0 | 0% |
| UST 2Y (yld) | 3.6 | -0.05 | -1.37% |
| UST 5Y (yld) | 3.824 | -0.047 | -1.21% |
| UST 10Y (yld) | 4.072 | -0.053 | -1.28% |
| UST 30Y (yld) | 4.387 | -0.051 | -1.15% |
The Banks Index lost 0.15 points (0.15%), closing at 99.48; within the index,
- North Fork Bancorp (NFB) -$0.42 (1.5%) to $27.60;
- National City Corp (NCC) -$0.23 (0.66%) to $34.44;
- BB&T Corp (BBT) -$0.25 (0.62%) to $40.27;
- US Bancorp (USB) -$0.14 (0.47%) to $29.61; and
- Washington Mutual (WM) -$0.19 (0.45%) to $42.00.
The Broker-dealer Index rose 0.07 points (0.05%), closing at 146.39; the ticket clippers lined up as follows -
- Jeffries Group (JEF) +$0.66 (1.84%) to $36.57;
- Raymond James (RJF) +$0.18 (0.66%) to $27.65;
- Lehman Brothers (LEH) +$0.59 (0.64%) to $93.14;
- A G Edwards (AGE) +$0.23 (0.55%) to $42.07; and
- Charles Schwab (SCH) +$0.04 (0.35%) to $11.58.
The Philadelphia SOX (Semiconductor) index slid 1.37 points (0.32%), ending the day at 423.86
- Taiwan Semiconductors (TSM) -$0.13 (1.4%) to $9.17;
- Teradyne (TER) -$0.16 (1.22%) to $12.99;
- Texas Instruments (TXN) -$0.32 (1.16%) to $27.38;
- Altera (ALTR) -$0.21 (0.94%) to $22.10; and
- Freescale Semiconductors (FSL-B) -$0.16 (0.78%) to $20.34.
Gold & Silver Markets
Gold
fell by $0.20 (0.05%) to close at $417.50 per ounce. It's now got
"headed for $410" written all over it; by the the US Dollar index
should be nudging 90, and that ought to cap the USD for a while... it
still mystifies me a little as to how Gold can decline further without
a larger rally in the USD, but that's what the entrails say... USD to
stall and
Gold to continue to soften.
Odd things happen when you get your market direction from offal.
The Gold Bugs Index added 5.18 points (3.02%), to end the session at 176.94
- Eldorado Gold (EGO) +$0.30 (14.42%) to $2.38;
- Golden Star (GSS) +$0.22 (8.56%) to $2.79;
- Harmony Gold (HMY) +$0.43 (6.2%) to $7.36;
- Coeur d'Alene (CDE) +$0.13 (4.73%) to $2.88; and
- Randgold Resources (GOLD) +$0.38 (3.36%) to $11.68.
Silver rose $0.03 (0.43%) to close at $6.99 per ounce. The Gold and Silver Index (XAU) gained 1.23 points (1.52%), ending the day at 81.96 points.
- Durban Rooderpoert Deep (DROOY) +$0.09 (10.59%) to $0.94;
- Harmony Gold (HMY) +$0.43 (6.2%) to $7.36;
- Kinross Gold (KGC) +$0.17 (3.36%) to $5.23; and
- Meridian Gold (MDG) +$0.37 (2.45%) to $15.48.
| Precious Metals and Indices | |||
| Index | Close | Gain(Loss) | % |
| Gold | 417.50 | -0.20 | -0.05% |
| Silver | 6.99 | 0.03 | 0.43% |
| PHLX Gold and Silver Index | 81.96 | 1.23 | 1.52% |
| AMEX Gold BUGS Index | 176.94 | 5.18 | 3.02% |
Oil Market
Remember
last week, when I mentioned
that journalists would get stymied by the rollover to the new
front-month in Crude, and would all talk about a big jump in oil prices
where none really existed?
If
you didn't get the contract
details right, it looked like shot up by $2.40 per barrel - because
last Friday's data was based on the June contract and todays is based
on the July. In fact comparing Friday's July close with todays. oil
only rose by $0.55 per barrel, closing at $49.20 per barrel.
That said, someone clearly
expects a decent drawdown
in inventories on Wednesday... in the 50 minutes from 10 a.m. NY time,
Crude rose $1.30 a barrel. That's a decent spike, although oil has now
got some tough sledding to do before it can get any sustained move
upwards.
The Oil and Gas Index (XOI) added 9.81 points (1.23%), to end the session at 806.65
- Occidental Petroleum (OXY) +$1.62 (2.38%) to $69.66;
- ConocoPhillips (COP) +$2.24 (2.22%) to $103.35; and
- Marathon Oil (MRO) +$0.88 (1.9%) to $47.10.
The Oil service stocks (OSX) Index added 1.74 points (1.36%), to 129.78
- Nabors Industries (NBR) +$1.03 (1.97%) to $53.21;
- GlobalSantaFe (GSF) +$0.67 (1.95%) to $35.06; and
- Noble Corp (NE) +$0.94 (1.79%) to $53.58.
| Energy Complex | |||
| Index | Close | Gain(Loss) | % |
| Reuters CRB | 296.47 | 3.19 | 1.09% |
| Crude Oil Light Sweet | 49.20 | 0.55 | 1.13% |
| Heating Oil | 1.3665 | 0 | -0.06% |
| Natural Gas | 6.405 | 0.06 | 0.98% |
| Unleaded Gas | 1.4005 | -0.02 | -1.31% |
| AMEX Oil Index | 806.65 | 9.81 | 1.23% |
| Oil Service Index | 129.78 | 1.74 | 1.36% |
Currency Markets
| USD Exchange Rates | |||
| Index | Close | Gain(Loss) | % |
| US Dollar Index | 86.36 | -0.24 | -0.28% |
| Euro | 1.2575 | 0.0022 | 0.18% |
| Yen | 107.63 | -0.52 | -0.48% |
| Sterling | 1.8302 | 0.0037 | 0.2% |
| Australian Dollar | 0.7592 | 0.0051 | 0.68% |
| Swiss Franc | 1.2305 | -0.0038 | -0.31% |
| Canadian Dollar | 0.7945 | 0.0045 | 0.57% |
