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Well, I guess this qualifies as a 'continuation' of yesterday's bounce (which as I mentioned, was late - thanks to what I am prepared to bet was the death of a medium-sized hedge fund the day before yesterday). Everything was green - but nobody should get all "Bartiromo-esque" here - the market is not on its way to a Happy Happy Joy Joy year. The rest of the year will suck, big time - don't let the normal option-expiration manipulation fool you.
From the "How did that happen" department...
For some reason I have developed a very strong negative reaction to coffee. Given that coffee is one of my five major food groups (along with pork-chops, duck confit, roast potatoes, and Kir), the sudden rejection of the stuff from my system is having some awkward side-effects.
I've always had no sympathy for tobacco-addiction (to the extent that I don't call them 'smokers' - in the same way as I don't call heroin addicts 'injectors'); I think that it's a stupid habit that only insecure children would ever adopt - which is why tobacco companies have always targeted children.
But let me tell you this: caffeine withdrawal sucks. And I don't particularly even WANT to withdraw!
It went like this. Yesterday I had my usual morning cup of coffee. I always leave it to go cold (I like cold coffee - I even put in cold water when I pour myself a cup), and there is almost always a half-cup of coffee on my desk. I also like a particularly gruesome brew: three teaspoons of coffee (preferably something strong) and two and a half of sugar. So I like it cold, black, and viscous - like the ooze that comes out of Dick Cheney's soul-hole.
So anyway... yesterday afternoon I realise I haven't had a coffee for literally hours; I grab the half-full cup that's on the desk, and almost retch at the smell. For some reason, black coffee now reminds me of ashtrays - and to me that is the most disgusting smell in the world. Worse than cat-spray, worse than rotten offal, worse than maggotty fish.
And now, just the thought of coffee makes me feel vaguely ill. Odd - there have been times in the past where I've tried quite hard to give up coffee, but at the moment I'm not trying at all... I've got a headache fit to burst, and if I thought I could bear it, I would have a coffee just to make the headache go away - but I would puke before the cup was made.
But that's not why wer're here... let's get on with it...
Federal Reserve Open Market Operations
The Fed's Open Market Operations desk performed 2 repurchase operations.
- a $7billion, 14-day repurchase with $3.642billion in T-backed collateral undertaken at a 5 basis point discount to the Fed Funds Rate (FFR); and
- a $12.25billion, overnight repurchase with $8.418billion in T-backed collateral undertaken at a 3 basis point discount to the Fed Funds Rate (FFR).
Major US Indices
Pretty impressivce, n'est-ce pas? I bet there's not a single subscriber who now has sweaty hands about the previously-advocated long position... sure it sucked for a day or two, but as usual the target was hit. (The reality is that with the concatenation of oversold on multiple timeframes, I ought to have been more patient... but the target was hit, and 3-lotters are currently rinding a nice earner).
The Dow Jones Industrial Average rose 198.27 points (1.83%), closing out the day at 11015.19 points. The index hit an intraday high of 11036.48about 15 minutes before the close, and the session low was 10817.48, set at the open.
All 30 of the Dow's components had a win for the day. The biggest gainers were Hewlett Packard (HPQ, +5.77% to $31.88) and Caterpillar (CAT, +4.99% to $70.85), which accounted for 41 Dow points between them. Total Volume traded in Dow issues was 496.2m shares - all of it in winners.
The broader S&P500 added 26.12 points (2.12%), to 1256.16. Within the index, gainers numbered 452, while just 14 S&P500 stocks fell for the day. Volume was tilted 28.7:1 in favour of the winners with 2211.30 million units traded in the winners as compared with 77.02 million traded in the losers .
Over at Times Square, the Nasdaq Composite added 58.15 points (2.79%), to close at 2144.15, while larger-cap technology issues fared better with the Nasdaq100 adding 42.82 points (2.8%), to end at 1573.08 points. Within the tech benchmark, gainers numbered 89, while a paltry 4 Nasdaq100 stocks fell for the day. Volume was tilted 26.0:1 in favour of the winners with 922.81 million traded in the winners compared to 35.45 million in the losers .
NYSE Volume was super-chunky, with 2.74 billion shares changing hands, while Nasdaq Volume was also super-chunky (over 2 bill), with 2.2 billion shares traded.
| Major Market Statistics | |||
| Index | Close | Gain(Loss) | % |
| Dow Jones Industrial Average | 11015.19 | 198.27 | 1.83% |
| S&P500 | 1256.16 | 26.12 | 2.12% |
| Nasdaq Composite | 2144.15 | 58.15 | 2.79% |
| Nasdaq100 | 1573.08 | 42.82 | 2.8% |
| NYSE Volume | 2.74bn | - | - |
| Nasdaq Volume | 2.2bn | - | - |
Bellwethers
My 9-stock "bellwethers" group rose by an average of 1.49%
- General Electric (GE) +$0.21 (0.62%) to $34.11;
- Citigroup (C) +$0.88 (1.84%) to $48.68;
- Wal Mart (WMT) +$0.95 (1.99%) to $48.66;
- I.B.M. (IBM) +$0.85 (1.09%) to $78.56;
- Intel (INTC) +$0.39 (2.2%) to $18.12;
- Cisco Systems (CSCO) +$0.61 (3.11%) to $20.22;
- eBay (EBAY) +$0.08 (0.25%) to $30.74;
- Fannie Mae (FNM) +$0.95 (2.01%) to $48.21; and
- Freddie Mac (FRE) +$0.18 (0.31%) to $57.76.
Market Breadth & Internals
NYSE advancing Issues exceeded decliners by 2662 to 625 for a single-day A/D reading of 2037; Nasdaq gainers trumped losers by 2493 to 598. The 10-day moving average of the A/D line rose to -179.2 on the NYSE, while the 10dma of the Nasdaq A/D rose to -193.2.
NYSE advancing volume exceeded volume in decliners by 2603.9 to 117.3 million shares; Nasdaq advancing volume was greater than volume in decliners by 2060.7 to 134.2 million shares.
26 NYSE-listed stocks rose to new 52-week highs, and 117 posted fresh 52-week lows, while on the Nasdaq there were 54 stocks that hit new 52-week highs, and 75 which fell to fresh 52-week lows.
| Market Breadth Statistics | ||
| NYSE | Nasdaq | |
| Advancers | 2662 | 2493 |
| Decliners | 625 | 598 |
| Advancing Volume (m) | 2603.93 | 2060.72 |
| Declining Volume (m) | 117.25 | 134.23 |
| New Highs | 26 | 54 |
| New Lows | 117 | 75 |
| Market Sentiment Statistics | |||
| Index | Close | Gain(Loss) | % |
| CBOE Volatility Index | 15.94 | -5.52 | -25.72% |
| CBOE Nasdaq Volatility Index | 19.48 | -4.86 | -19.97% |
| Equity Put-Call Ratio | 0.71 | -0.3 | -29.7% |
| 10-day PCR | 0.87 | -0.02 | -2.05% |
| SPX-VIX Ratio | 78.8 | 21.49 | 37.49% |
Bond Market Analysis
Bonds fell at the long end, with the yield on the benchmark 30-year Treasury bond rising 5.0 bps to 5.135%.
The middle of the yield curve was broadly lower: five year yields rose to 5.071%, and ten-year yields rose to 5.098%.
Spreads between short-dated (2-yr) Treasuries and high-grade corporate bonds of similar maturity profiles were 1.0 bps tighter at 39.0 basis points; spreads between longer dated Treasuries and their corporate AAA counterparts fell to 69.0 bps for 10-year AAA, and 101.0 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 5.0 bps looser at 32.0 basis points and the 10-year AAA-A spread 10.0 bps looser at 25.0 bps.
| Treasury Yields | |||
| Index | Close | Gain(Loss) | % |
| UST 13wk (yld) | 4.72 | -0.04 | -0.84% |
| UST 2Y (yld) | 5.13 | 0.1 | 1.99% |
| UST 5Y (yld) | 5.071 | 0.045 | 0.9% |
| UST 10Y (yld) | 5.098 | 0.048 | 0.95% |
| UST 30Y (yld) | 5.135 | 0.05 | 0.98% |
The Banks Index added 2.03 points (1.92%), at 107.53; within the index,
- PNC Financial Services (PNC) +$2.67 (3.99%) to $69.56;
- Fifth Third Bancorp (FITB) +$1.11 (3.01%) to $37.98;
- State Street (STT) +$1.64 (2.86%) to $59.04;
- Mellon Financial (MEL) +$0.98 (2.83%) to $35.58; and
- Bank Of America (BAC) +$1.27 (2.72%) to $47.91.
The Broker-dealer Index posted a rise of 11.17 points (5.79%), to end the session at 204.11; the ticket clippers lined up as follows -
- E*Trade (ET) +$2.19 (11.3%) to $21.57;
- Ameritrade (AMTD) +$1.26 (8.8%) to $15.58;
- Jeffries Group (JEF) +$1.98 (7.84%) to $27.22;
- Raymond James (RJF) +$1.87 (7.01%) to $28.56; and
- Bear Stearns (BSC) +$7.36 (5.93%) to $131.56.
The Philadelphia SOX (Semiconductor) index posted a rise of 18.25 points (4.15%), closing at 457.58
- Marvell Tech Group (MRVL) +$3.46 (7.1%) to $52.19;
- Broadcom (BRCM) +$1.80 (5.88%) to $32.40;
- Freescale Semiconductors (FSL-B) +$1.59 (5.85%) to $28.76;
- Micron Technology (MU) +$0.78 (5.11%) to $16.04; and
- Infineon Tech (IFX) +$0.47 (4.52%) to $10.87.
Gold & Silver Markets
Gold rose $3.80 (0.67%) to close at $570.3 per ounce.
The Gold Bugs Index posted a rise of 17.97 points (6.42%), to 297.84
- Meridian Gold (MDG) +$2.64 (9.79%) to $29.60;
- Hecla Mining (HL) +$0.38 (9.16%) to $4.53;
- Eldorado Gold (EGO) +$0.38 (9.09%) to $4.56;
- Randgold Resources (GOLD) +$1.31 (7.61%) to $18.52; and
- Freeport McMoran (FCX) +$3.34 (7.31%) to $49.04.
Silver rose $0.24 (2.41%) to close at $9.97 per ounce.
The Gold and Silver Index (XAU) gained 6.45 points (5.26%), ending the day at 129.16 points.
- Meridian Gold (MDG) +$2.64 (9.79%) to $29.60;
- Durban Rooderpoert Deep (DROOY) +$0.10 (8.26%) to $1.31;
- Freeport McMoran (FCX) +$3.34 (7.31%) to $49.04; and
- Kinross Gold (KGC) +$0.67 (7.29%) to $9.86.
| Precious Metals and Indices | |||
| Index | Close | Gain(Loss) | % |
| Gold | 570.30 | 3.80 | 0.67% |
| Silver | 9.97 | 0.24 | 2.41% |
| PHLX Gold and Silver Index | 129.16 | 6.45 | 5.26% |
| AMEX Gold BUGS Index | 297.84 | 17.97 | 6.42% |
Oil Market
Oil was firmer, rising by $0.36 per barrel, closing at $69.50 per barrel.
The Oil and Gas Index (XOI) gained 34.88 points (3.4%), to 1060.8
- Occidental Petroleum (OXY) +$3.84 (4.11%) to $97.25;
- Marathon Oil (MRO) +$3.06 (4.26%) to $74.83; and
- TotalFinaElf S.A. (TOT) +$2.50 (4.23%) to $61.65.
The Oil service stocks (OSX) Index rose 10.94 points (5.73%), to end the session at 201.79
- Smith International (SII) +$2.99 (8.04%) to $40.20;
- Noble Corp (NE) +$4.52 (6.93%) to $69.74; and
- Weatherford International (WFT) +$3.01 (6.54%) to $49.02.
| Energy Complex | |||
| Index | Close | Gain(Loss) | % |
| Reuters CRB | 379 | 6.75 | 1.81% |
| Crude Oil Light Sweet | 69.5 | 0.36 | 0.52% |
| Heating Oil | 1.9369 | 0 | 0.05% |
| Natural Gas | 7.207 | 0.62 | 9.36% |
| Unleaded Gas | 2.0396 | 0 | 0.18% |
| AMEX Oil Index | 1060.8 | 34.88 | 3.4% |
| Oil Service Index | 201.79 | 10.94 | 5.73% |
Currency Markets
| USD Exchange Rates | |||
| Index | Close | Gain(Loss) | % |
| US Dollar Index | 85.64 | -0.09 | -0.1% |
| Euro | 1.2624 | -0.0048 | -0.38% |
| Yen | 114.79 | 113.9095 | 12936.91% |
| Sterling | 1.8487 | 0.003 | 0.16% |
| Australian Dollar | 0.742 | 0.0079 | 1.08% |
| Swiss Franc | 1.2316 | 0.4117 | 50.21% |
| Canadian Dollar | 0.8991 | -0.0007 | -0.08% |
