Note - from June 24th 2009, this blog has migrated from Blogger to a self-hosted version. Click here to go straight there.
Pre-market data stank, with the primary nasties being earnings outlook reductions from Amazon.com and Boeing. AMZN - which was carrying the much richer earnings multiple - got absolutely hammered, falling almost 14% for the session. BA got off relatively lightly with a 2% downdraught.
The White House is bracing itself for rumoured indictments to be issued by Patrick Fitzgerald; the rumour is that the indictments will come today. Will it be Feith? Libby? (Deep breath.....) Cheney? (Deeper breath) ROVE?
Well, call me seditious, but the entire lot of them ought to be put in a room with 20 machete-wielding Fallujans. 'Outing' Valerie Plame was a low act, but was entirely consistent with the bitchy (and, frankly, massively gay) NeoTrot cabal. Of far greater import is the fact that they lied the world into a war that has cost 100,000 (conservatively) excess Iraqi deaths, mostly children, women and the elderly. And they have the gall to call Saddam Hussein 'evil'.
Hand the lot of them over to the Iraqis who have had their children torn to pieces by 'smart' bombs - and let the Iraqis get all 'Abu Ghraib' on their arses.
And where, Oh Where is the Australian media? Why aren't the shameless vermin who occupy Canberra being put in the dock over our involvement? Simple: because their symbiotes - the Canberra Press Gallery - are all hand-in-glove with their co-vermin... they're effectively one great big Judith Miller... a giant media whore-for-war.
Thank Crom (or Odin, or the Flying Spaghetti Monster) for the blogosphere: that's what forced the Canberra Press Gallery to act all surprised about the Stalinist elements of the new 'anti-Terror' bill (which more accurately ought to be called an 'anti-Liberty' bill). Prior to some genuine outrage both here and in the US on major blogs, the Canberra Press Gallery had - like any good whore - simply taken directions from its client and had ignored the 'shoot to kill' and 'preventive detention' clauses. But for the blogs, Australia would never have known what it was in for. (Note - I don't include this blog among those who helped force the blowing of the whistle).
As I've said before - the next step is for the Stalinist-Statists to try and limit access to the internet... to further attempt to impose a 'correct line' ideology on the population. This step will almost certainly be driven by another round of scare-campaign roundups of agitators who are found to have 'kiddie porn' on their computers... it's amazing what a government stooge with a DVD in his pocket can achieve, given ten seconds of unsupervised access to a person's PC (assuming the required 'evidence' can't be 'pushed' to the 'perpetrator's PC via the Web).
Do not trust your government. It is there to take stuff off you.
Federal Reserve Open Market Operations
The Fed's Open Market Operations desk performed 1 repurchase operation: continuing its recent trend of disappointingly-inadequate jamjob-funding, it provided a $4.25billion, overnight repurchase with $4.053billion in T-backed collateral undertaken at a 3.8 basis point discount to the Fed Funds Rate (FFR).
Major US Indices
Just one clear divergence signal this session - a selling divergence that coincided with the Dow's tease-break of the first hour high. It took a little bit of time for that particular push to stall, but as usual the divergence approach paid off. It will be interesting to see if the grey moving average line (currently siting just below 10340) will provide the catalyst for a bounce tomorrow (if it's tested).
Several people whose work I admire were of the opinion that 1200 would hold on the S&P futures last night. More accurately, they started to think that once 1206 was broken to the upside: but as I said at the time (while 'they' were all waiting for a pullback to 1202), the market continued down through 1202 and only paused at 1200 thanks to a concatenation of numbers (10400 on the Dow futures was the 'primary trampoline', with the S&P futures at 1201) ... but all of them gave way eventually.
About the only positive - technically speaking - about the session was that the Dow never seriously tested its early-session low (the S&P500 - both cash and futures -made new lows in the afternoon, as did the technology indices).
The Dow Jones Industrial Average lost 32.89 points (0.32%), closing out the day at 10344.98 points. After dipping to 10336 at the open - the result of reaction to the AMZN/BA warnings - the Dow spiked almost 100 points in about 90 minutes, to an intraday high of 10434.47 before the CCI divergence turned it down... and how.
Within the blue-chip index, 14 stocks rose, the biggest gainers being Du Pont (DD, +1.72% to $41.50) and JPMorganChase (JPM, +1.06% to $36.10), which accounted for 9 Dow points between them. Losers in the Dow numbered 16 and were led by Boeing (BA, -2.79% to $65.10) and Mcdonalds (MCD, -2.09% to $32.31), with these two stocks contributing -20 Dow points worth of downward pressure on the index. Volume traded was tilted in favour of the losers by 230.8m shares to 179.1m.
The broader S&P500 declined 5.16 points (0.43%), ending the day at 1191.38. Within the index, gainers numbered 175, while 304 S&P500 stocks fell for the day. Volume was tilted 2.0:1 in favour of the losers with 1406.84 million units traded in the losers as compared with 701.45 million traded in the winners .
Over at Times Square, the Nasdaq Composite dipped 9.4 points (0.45%), to close at 2100.05, while larger-cap technology issues fared worse with the Nasdaq100 losing 10.68 points (0.67%), to end at 1575.14 points. Within the tech benchmark, gainers numbered 28, while 65 Nasdaq100 stocks fell for the day. Volume was tilted 2.2:1 in favour of the losers with 535.95 million traded in the losers compared to 245.88 million in the winners .
NYSE Volume was super-chunky, with 2.49 billion shares changing hands, while Nasdaq Volume was chunky, with 1.89 billion shares traded.
| Major Market Statistics | |||
| Index | Close | Gain(Loss) | % |
| Dow Jones Industrial Average | 10344.98 | -32.89 | -0.32% |
| S&P500 | 1191.38 | -5.16 | -0.43% |
| Nasdaq Composite | 2100.05 | -9.4 | -0.45% |
| Nasdaq100 | 1575.14 | -10.68 | -0.67% |
| NYSE Volume | 2.49bn | - | - |
| Nasdaq Volume | 1.89bn | - | - |
Bellwethers
My 9-stock "bellwethers" group rose by an average of 0.47%, thanks mostly to bounces in the Toxic Twins (Fannie Mae and Freddie Mac). Odd that these two mortgage-pimps should bounce, given rising long rates. Also, I think that Citigroup is being held up primarily so that its handlers can sell some calls in tomorrow's early going: for once I think that it's not acting as a bellwether.
- General Electric (GE) -$0.21 (0.62%) to $33.70;
- Citigroup (C) +$0.48 (1.06%) to $45.65;
- Wal Mart (WMT) +$0.19 (0.42%) to $45.58;
- I.B.M. (IBM) -$0.47 (0.56%) to $82.86;
- Intel (INTC) -$0.04 (0.17%) to $23.07;
- Cisco Systems (CSCO) -$0.02 (0.12%) to $17.10;
- eBay (EBAY) +$0.29 (0.76%) to $38.30;
- Fannie Mae (FNM) +$0.98 (2.13%) to $46.89; and
- Freddie Mac (FRE) +$0.82 (1.37%) to $60.75.
Market Breadth & Internals
NYSE declining Issues beat out advancers by 2214 to 1080, for a single-day A/D reading of -1134; and Nasdaq losers exceeded gainers by 1779 to 1206. The 10-day moving average of the A/D line fell to -237.8 on the NYSE, while the 10dma of the Nasdaq A/D fell to -118.2.
On the NYSE declining volume was greater than volume in advancing issues by 1620.7 to 815.5 million shares; On the Nasdaq declining volume exceeded volume in advancing issues by 1233.1 to 621.6 million shares.
62 NYSE-listed stocks rose to new 52-week highs, and 181 posted fresh 52-week lows, while on the Nasdaq there were 78 stocks that hit new 52-week highs, and 74 which fell to fresh 52-week lows.
| Market Breadth Statistics | ||
| NYSE | Nasdaq | |
| Advancers | 1080 | 1206 |
| Decliners | 2214 | 1779 |
| Advancing Volume (m) | 815.47 | 621.6 |
| Declining Volume (m) | 1620.71 | 1233.14 |
| New Highs | 62 | 78 |
| New Lows | 181 | 74 |
| Market Sentiment Statistics | |||
| Index | Close | Gain(Loss) | % |
| CBOE Volatility Index | 14.59 | 0.06 | 0.41% |
| CBOE Nasdaq Volatility Index | 15.87 | 0.59 | 3.86% |
| Equity Put-Call Ratio | 0.81 | 0.18 | 28.57% |
| 10-day PCR | 0.70 | 0 | 0% |
| SPX-VIX Ratio | 81.7 | -0.69 | -0.84% |
Bond Market Analysis
Bonds fell sharply at the long end, with the yield on the benchmark 30-year Treasury bond rising 8.3 bps to 4.796%. The 30-year bond dropped almost a full point, finishing the session at 111-16/32: yet again, I express my thanks to Crom (and Odin, and the Flying Spaghetti Monster) for the heads-up that prompted me to exit the long position in the bonds (initiated at 112-19/32) off at 113-7/32 for a nice 25% gain in two sessions (there was a re-load also, but recall that I didn't 'claim' it despite its outperformance of the initial trade).
The middle of the yield curve was broadly lower: five year yields rose to 4.46%, and ten-year yields rose to 4.591%.
Spreads between short-dated (2-yr) Treasuries and high-grade corporate bonds of similar maturity profiles were 10.0 bps wider at 18.0 basis points; spreads between longer dated Treasuries and their corporate AAA counterparts rose to 51.0 bps for 10-year AAA, and 69.5 bps for 20-years.
Credit spreads (spreads between corporate bonds of the same maturity profile but different creditworthiness) were mixed with the AAA-A spread on 20-years 19.0 bps tighter at 41.0 basis points and the 10-year AAA-A spread 1.0 bp wider at7.0 bps.
| Treasury Yields | |||
| Index | Close | Gain(Loss) | % |
| UST 13wk (yld) | 3.805 | -0.032 | -0.83% |
| UST 2Y (yld) | 4.36 | 0.04 | 0.93% |
| UST 5Y (yld) | 4.46 | 0.081 | 1.85% |
| UST 10Y (yld) | 4.591 | 0.083 | 1.84% |
| UST 30Y (yld) | 4.796 | 0.083 | 1.76% |
The Banks Index posted a rise of 0.38 points (0.39%), ending the day at 97.71; within the index,
- Fifth Third Bancorp (FITB) +$1.03 (2.72%) to $38.95;
- JPMorganChase (JPM) +$0.38 (1.06%) to $36.10;
- Citigroup (C) +$0.48 (1.06%) to $45.65;
- State Street (STT) +$0.55 (1.03%) to $54.10; and
- Washington Mutual (WM) +$0.37 (0.98%) to $38.06.
The Broker-dealer Index advanced 1.39 points (0.78%), at 179.86; the ticket clippers lined up as follows -
- Legg Mason (LM) +$5.00 (4.83%) to $108.48;
- E*Trade (ET) +$0.41 (2.26%) to $18.58;
- Raymond James (RJF) +$0.47 (1.44%) to $33.15;
- Charles Schwab (SCH) +$0.16 (1.12%) to $14.47; and
- Merrill Lynch (MER) +$0.42 (0.67%) to $63.48.
The Philadelphia SOX (Semiconductor) index slid 2.56 points (0.58%), ending the day at 439.58
- Teradyne (TER) -$0.43 (2.98%) to $14.00;
- Marvell Tech Group (MRVL) -$0.87 (1.88%) to $45.49;
- Taiwan Semiconductors (TSM) -$0.13 (1.65%) to $7.74;
- Applied Materials (AMAT) -$0.26 (1.51%) to $16.93; and
- Linear Technology (LLTC) -$0.45 (1.27%) to $34.95.
Gold & Silver Markets
Gold fell by $1.70 (0.36%) to close at $473 per ounce.
The Gold Bugs Index lost 6.76 points (2.94%), ending the day at 223.49
- Meridian Gold (MDG) -$1.65 (8%) to $18.97;
- Hecla Mining (HL) -$0.27 (6.92%) to $3.63;
- Golden Star (GSS) -$0.14 (5.15%) to $2.58;
- Kinross Gold (KGC) -$0.36 (5.03%) to $6.79; and
- Randgold Resources (GOLD) -$0.69 (4.65%) to $14.15.
Silver rose $0.04 (0.49%) to close at $7.86 per ounce.
The Gold and Silver Index (XAU) lost 2.79 points (2.57%), to 105.77 points.
- Durban Rooderpoert Deep (DROOY) -$0.14 (10.07%) to $1.25;
- Meridian Gold (MDG) -$1.65 (8%) to $18.97;
- Kinross Gold (KGC) -$0.36 (5.03%) to $6.79; and
- Newmont Mining (NEM) -$1.57 (3.44%) to $44.09.
| Precious Metals and Indices | |||
| Index | Close | Gain(Loss) | % |
| Gold | 473.00 | -1.70 | -0.36% |
| Silver | 7.86 | 0.04 | 0.49% |
| PHLX Gold and Silver Index | 105.77 | -2.79 | -2.57% |
| AMEX Gold BUGS Index | 223.49 | -6.76 | -2.94% |
Oil Market
You might read some palaver today about how Oil fell after larger-than-expected inventory data. Well, I'm here to tell you the opposite. It rose - sharply - after the inventory data, and two hours after the data was released it was still knocking on the door of $63. The failure to get through $63 was a technical failure, and had nothing to do with the Inventories numbers.
Regardless of the reason for the decline, I'm chuffed that I didn't get all sweaty-palmed about it - as I said, it would have taken a close above $65 to get me back in the bull camp. As it now stands, crude has 'washed off' its oversold condition and can now resume its attempts to break $60 meaningfully.
This session Oil lost ground, shedding $1.78 per barrel, closing at $60.66 per barrel. It printed a 'spike' low at $58.86 as the big players slammed the market around in the seconds after the inventories numbers - that was pure stop-clearing, and from there the market shot skywards with some real venom. Only when the thing failed technically did the oil market (and the entire energy complex) reverse back down.
From here it seems almost a 'given' that Crude will be capable of testing my target of $57-ish.
The Oil and Gas Index (XOI) slid 2.58 points (0.27%), ending the day at 967.24
- Exxon Mobil (XOM) -$1.00 (1.75%) to $56.20;
- ChevronTexaco (CVX) -$1.01 (1.72%) to $57.66; and
- Sunoco (SUN) -$0.66 (0.91%) to $72.12.
The Oil service stocks (OSX) Index advanced 0.29 points (0.18%), at 165.6
- Tidewater (TDW) +$0.86 (1.9%) to $46.16;
- Schlumberger (SLB) +$1.48 (1.73%) to $87.15; and
- Noble Corp (NE) +$0.84 (1.29%) to $66.09.
| Energy Complex | |||
| Index | Close | Gain(Loss) | % |
| Reuters CRB | 334.51 | -2.92 | -0.87% |
| Crude Oil Light Sweet | 60.66 | -1.78 | -2.85% |
| Heating Oil | 1.8986 | -0.03 | -1.76% |
| Natural Gas | 14.06 | -0.28 | -1.94% |
| Unleaded Gas | 1.6211 | -0.08 | -4.62% |
| AMEX Oil Index | 967.24 | -2.58 | -0.27% |
| Oil Service Index | 165.6 | 0.29 | 0.18% |
Currency Markets
| USD Exchange Rates | |||
| Index | Close | Gain(Loss) | % |
| US Dollar Index | 89.49 | 0.26 | 0.29% |
| Euro | 1.2068 | -0.0038 | -0.31% |
| Yen | 115.865 | 0.835 | 0.73% |
| Sterling | 1.7748 | -0.0096 | -0.54% |
| Australian Dollar | 0.7548 | -0.0019 | -0.25% |
| Swiss Franc | 1.2831 | 0.0065 | 0.51% |
| Canadian Dollar | 0.8548 | 0.0037 | 0.43% |
