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Far out... I babbled away yesterday about the huge amount of repurchase dough that had been fore-fed into the market this week - there had been a total of $28.5 billion, with the overwhelming bulk of that in market-boosting Treasury-backed collateral. And last night the Fed's OMO desk outdid itself - another $15.5 billion, with $15.25 billion in T-backed. Is it any wonder that da Boyz have had little trouble goosing the market?
Federal Reserve Open Market Operations
The Fed's Open Market Operations desk performed 2 repurchase operations.
- a $3.5billion, overnight repurchase entirely in T-backed collateral; and
- a $12billion, 14-day repurchase with $11.75billion in T-backed collateral.
I will admit that the data was 'mixed at best', with
- Jobless Claims were a bit better than expected (320k vs a guess of 330k);
- the Leading Economic Indicators bleh as expected (-0.2% for both actual and consensus); and
- the Philly Fed less than half of the consensus guess (actual 7.3, expected 18).
As I mentioned in conversation during the session, the entire session was a series of apparently un-missable shorting opportunities, which then gave nothing and squeezed you out at a loss. There were a couple of decent 'ridable' shorts - but by the time they presented themselves, traders' nerves were so frazzled from being 'clipped', that profits were grabbed early... or given back entirely.
Major US Indices
By the end of the session, the Dow Jones Industrial Average had posted a rise of 28.74 points (0.27%), closing out the day at 10493.19 points. The early part of the session was spent with a concrete cap at about 10480, and a concrete floor at 10440. At about 2:50 p.m., the index did a sneaky, sneaky thing... it broke the levels that had provided support earlier in the session, with the Dow dipping below 10440 and the S&P dropping under 1186 (basis the S&P futures). The Dow dipped to its session low just above 10435... then , with 'breakout'-style shorts jumping on an apparently-declining bandwagon, the indices reversed upwards sharply, closing at or near their session highs.
The Dow hit its intraday high of 10494.74 shortly after the first release of Market On Close imbalances from the NYSE - i.e., just after 3:35 NY time, having advanced 60 points from its session low, in under 60 minutes.
Within the blue-chip index, 18 stocks rose, the biggest gainers being General Motors (GM, +3.61% to $32.75) and Exxon Mobil (XOM, +2.20% to $54.83), which accounted for 17 Dow points between them. Losers in the Dow numbered 12 and were led by Du Pont (DD, -0.90% to $47.61) and United Technology (UTX, -0.71% to $105.00), with these two stocks contributing -9 Dow points worth of downward pressure on the index. Volume traded was tilted in favour of the gainers by 253m shares to 60.5m.
The broader S&P500 gained 5.52 points (0.47%), to 1191.08. Within the index, gainers numbered 309, while 180 S&P500 stocks fell for the day. Volume was tilted 2.7:1 in favour of the winners with 1229.15 million units traded in the winners as compared with 449.18 million traded in the losers .
Over at Times Square, the Nasdaq Composite gained 11.93 points (0.59%), to close at 2042.58, while larger-cap technology issues fared better with the Nasdaq100 adding 12.17 points (0.81%), to end at 1521.43 points. Within the tech benchmark, gainers numbered 70, while 30 Nasdaq100 stocks fell for the day. Volume was tilted 2.9:1 in favour of the winners with 568.01 million traded in the winners compared to 197.92 million in the losers .
NYSE Volume was reasonably chunky, with 1.78 billion shares changing hands, while Nasdaq Volume was also pretty chunky, with 1.73 billion shares moving from one online brokerage account to another.
| Major Market Statistics | |||
| Index | Close | Gain(Loss) | % |
| Dow Jones Industrial Average | 10493.19 | 28.74 | 0.27% |
| S&P500 | 1191.08 | 5.52 | 0.47% |
| Nasdaq Composite | 2042.58 | 11.93 | 0.59% |
| Nasdaq100 | 1521.43 | 12.17 | 0.81% |
| NYSE Volume | 1.78bn | - | - |
| Nasdaq Volume | 1.73bn | - | - |
Bellwethers
My 9-stock "bellwethers" group rose by an average of 0.49%
- General Electric (GE) +$0.02 (0.05%) to $36.92;
- Citigroup (C) +$0.10 (0.21%) to $47.84;
- Wal Mart (WMT) -$0.07 (0.15%) to $47.51;
- I.B.M. (IBM) +$0.80 (1.05%) to $77.16;
- Intel (INTC) +$0.08 (0.31%) to $26.01;
- Cisco Systems (CSCO) +$0.14 (0.73%) to $19.38;
- eBay (EBAY) +$0.46 (1.29%) to $36.16;
- Fannie Mae (FNM) +$0.04 (0.07%) to $56.54; and
- Freddie Mac (FRE) +$0.52 (0.81%) to $64.85.
Market Breadth & Internals
NYSE advancing Issues exceeded decliners by 2031 to 1217 for a single-day A/D reading of 814; Nasdaq gainers trumped losers by 1671 to 1382. The 10-day moving average of the A/D line rose to 684.0 on the NYSE, while the 10dma of the Nasdaq A/D fell to 328.6.
NYSE advancing volume exceeded volume in decliners by 1209.4 to 520.4 million shares; Nasdaq advancing volume was greater than volume in decliners by 1230.1 to 483.9 million shares.
106 NYSE-listed stocks rose to new 52-week highs, and 28 posted fresh 52-week lows, while on the Nasdaq there were 80 stocks that hit new 52-week highs, and 45 which fell to fresh 52-week lows.
| Market Breadth Statistics | ||
| NYSE | Nasdaq | |
| Advancers | 2031 | 1671 |
| Decliners | 1217 | 1382 |
| Advancing Volume (m) | 1209.37 | 1230.08 |
| Declining Volume (m) | 520.37 | 483.86 |
| New Highs | 106 | 80 |
| New Lows | 28 | 45 |
| Market Sentiment Statistics | |||
| Index | Close | Gain(Loss) | % |
| CBOE Volatility Index | 13.32 | -0.26 | -1.91% |
| CBOE Nasdaq Volatility Index | 16.95 | -0.58 | -3.31% |
| Equity Put-Call Ratio | 0.64 | -0.09 | -12.33% |
| 10-day PCR | 0.69 | -0.01 | -1.81% |
| SPX-VIX Ratio | 89.4 | 2.12 | 2.43% |
Bond Market Analysis
Bonds fell a teensy bit at the long end, with the yield on the benchmark 30-year Treasury bond rising 1.3 bps to 4.443%. The 30-year bond future dipped below 116, closing at 115 & 31/32. I said yesterday I wouldn't 'claim' the short from 116 & 16/32 despite giving a clear indication in prior Rants that I looked forward to shorting above that level, and it pains me no end...
The middle of the yield curve was broadly lower: five year yields rose to 3.837%, and ten-year yields rose to 4.108%.
Spreads between short-dated (2-yr) Treasuries and high-grade corporate bonds of similar maturity profiles were unchanged at 10.0 basis points; spreads between longer dated Treasuries and their corporate AAA counterparts fell to 56.0 bps for 10-year AAA, and 89.0 bps for 20-years.
Credit spreads (spreads between corporate bonds of the same maturity profile but different creditworthiness) were broadly tighter with the AAA-A spread on 20-years increasing 2.0 bps to 52.0 basis points and the 10-year AAA-A spread 3.0 bps wider at 3.0 bps.
| Treasury Yields | |||
| Index | Close | Gain(Loss) | % |
| UST 13wk (yld) | 2.802 | 0 | 0% |
| UST 2Y (yld) | 3.62 | 0.06 | 1.69% |
| UST 5Y (yld) | 3.837 | 0.066 | 1.75% |
| UST 10Y (yld) | 4.108 | 0.04 | 0.98% |
| UST 30Y (yld) | 4.443 | 0.013 | 0.29% |
The Banks Index dipped 0.1 points (0.1%), to end the session at 100.03; within the index,
- North Fork Bancorp (NFB) -$0.33 (1.16%) to $28.08;
- Fifth Third Bancorp (FITB) -$0.49 (1.1%) to $43.91;
- Zions Bancorp (ZION) -$0.56 (0.78%) to $71.52;
- Golden West Financial (GDW) -$0.46 (0.73%) to $62.80; and
- Northern Trust (NTRS) -$0.31 (0.66%) to $46.88.
The Broker-dealer Index added 0.57 points (0.39%), ending the day at 146.52; the ticket clippers lined up as follows -
- Morgan Stanley (MWD) +$1.23 (2.51%) to $50.15;
- Legg Mason (LM) +$1.00 (1.22%) to $83.00;
- Bear Stearns (BSC) +$0.97 (0.99%) to $98.64;
- A G Edwards (AGE) +$0.37 (0.89%) to $41.82; and
- Goldman Sachs (GS) +$0.54 (0.54%) to $100.12.
The Philadelphia SOX (Semiconductor) index added 1.2 points (0.29%), ending the day at 420.09
- Taiwan Semiconductors (TSM) +$0.25 (2.77%) to $9.28;
- Freescale Semiconductors (FSL-B) +$0.33 (1.63%) to $20.54;
- Xilinx (XLNX) +$0.26 (0.95%) to $27.71;
- Maxim Integrated (MXIM) +$0.34 (0.87%) to $39.24; and
- Teradyne (TER) +$0.10 (0.77%) to $13.07.
Gold & Silver Markets
Gold fell by $0.90 (0.21%) to close at $420.80 per ounce. At one stage during the session it was down under $420 again, but from midday NY time it spiked nearly $2 in an hour after the Philly Fed index was released.
The Gold Bugs Index slid 1.49 points (0.86%), to end the session at 172.73
- Hecla Mining (HL) -$0.10 (2.4%) to $4.07;
- Gold Fields (GFI) -$0.24 (2.36%) to $9.93;
- Randgold Resources (GOLD) -$0.24 (2.05%) to $11.49;
- Agnico Eagle (AEM) -$0.22 (1.94%) to $11.12; and
- Coeur d'Alene (CDE) -$0.05 (1.73%) to $2.84.
Silver fell by $0.09 (1.25%) to close at $7.14 per ounce. The Gold and Silver Index (XAU) lost 0.51 points (0.62%), closing at 81.7 points.
- Gold Fields (GFI) -$0.24 (2.36%) to $9.93;
- Anglogold Ashanti (AU) -$0.69 (2.1%) to $32.11;
- Agnico Eagle (AEM) -$0.22 (1.94%) to $11.12; and
- Goldcorp (GG) -$0.10 (0.77%) to $12.90.
| Precious Metals and Indices | |||
| Index | Close | Gain(Loss) | % |
| Gold | 420.80 | -0.90 | -0.21% |
| Silver | 7.14 | -0.09 | -1.25% |
| PHLX Gold and Silver Index | 81.7 | -0.51 | -0.62% |
| AMEX Gold BUGS Index | 172.73 | -1.49 | -0.86% |
Oil Market
Oil lost ground, shedding $0.07 per barrel, closing at $46.94 per barrel. After touching $48 twice in the early part of the session, Oil turned south pretty hard. Note though, that the oil market is still in contango - the July contract (which is now the heaviest-traded in trerms of actual turnover) sloced above $49. So expect a few stories in the mainstream media over the next week or so, positing that oil 'jumped' in a way that journalists apparently couldn't grasp... that will just be the change in quotes from June to July contracts.
Oil is now deeply oversold - that doesn't mean it can't get more oversold, but in a sense it is like Gold; it is rare relative to demand, it is part of a deeply manipulated market - with a cartel on the supply side, and a bellicose rogue nation on the demand side... chucking its weight about in oil-rich areas and trying to alter the demand-supply equation by killing children and stealing their parent's resources.
We haven't come far from the caves, have we? HInt: you can tell that Darwin was right by looking at Bush and Howard... the difference between them and zoo chimps is that Bush and Howard can't pick their own arses in public or fling handfuls of shit at passers-by (you know that they want to, though). Every time I see chimps in an enclosure I think of War Crimes proceedings against Bush, Blair and Howard... the wrong simians are behind bars at the moment.
The Oil and Gas Index (XOI) rose 6.04 points (0.76%), closing at 800.56
- Sunoco (SUN) +$2.69 (2.81%) to $98.59;
- Amerada Hess (AHC) +$2.23 (2.5%) to $91.31; and
- Exxon Mobil (XOM) +$1.18 (2.2%) to $54.83.
The Oil service stocks (OSX) Index added 2.34 points (1.85%), ending the day at 128.57
- Noble Corp (NE) +$1.74 (3.43%) to $52.44;
- Baker Hughes (BHI) +$1.10 (2.55%) to $44.30; and
- Schlumberger (SLB) +$1.58 (2.42%) to $67.00.
| Energy Complex | |||
| Index | Close | Gain(Loss) | % |
| Reuters CRB | 293.54 | -1.31 | -0.44% |
| Crude Oil Light Sweet | 46.94 | -0.07 | -0.15% |
| Heating Oil | 1.39 | 0.04 | 2.65% |
| Natural Gas | 6.38 | -0.01 | -0.22% |
| Unleaded Gas | 1.4375 | 0.03 | 2.02% |
| AMEX Oil Index | 800.56 | 6.04 | 0.76% |
| Oil Service Index | 128.57 | 2.34 | 1.85% |
Currency Markets
| USD Exchange Rates | |||
| Index | Close | Gain(Loss) | % |
| US Dollar Index | 86.13 | 0.29 | 0.34% |
| Euro | 1.2636 | -0.0047 | -0.37% |
| Yen | 107.62 | 0.72 | 0.67% |
| Sterling | 1.8347 | -0.006 | -0.33% |
| Australian Dollar | 0.7576 | -0.0037 | -0.49% |
| Swiss Franc | 1.2223 | 0.0053 | 0.44% |
| Canadian Dollar | 0.794 | 0 | 0% |
