Interdum stultus opportuna loquitur...

Monday, February 25, 2008

USRant: S&P Drops the Ball Pre-emptively...

Note - from June 24th 2009, this blog has migrated from Blogger to a self-hosted version. Click here to go straight there.

Another Monday, another Pavlovian lurch upwards in the US markets. S&P confirmed that they are absolutely committed to their philosophy of failing to downgrade anybody who pays their S&P bill... at least until the day after they file Ch11.

Honestly - for market to rally on a definitive proof that the world's major ratings agency has decided to punt on second down... it's laughable.

If you want to see some folks who know how to rate stuff, then head on over to GT Market Analytics; at the moment everything is still locked down tighter than a goldfish's sphincter, but tomorrow (or maybe the day after) I plan to throw open the gates and let the Hordes enter to kick the tyres.

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As you will see at the Great Unveiling, I've not gained a solitary bit of expertise at making things look good. but the grunt underpinning the site is a wonder to behold. And it's flexible, too.

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Economic News

Th major news was the ludicrous decision by S&P to formally neglect to downgrade MBIA and AMBAC. It' not going to help their bondholders in the long term, but doubtless S&P was well remunerated for the decision, and the analyst concerned will be forgotten soon enough (who was the S&P analyst who refused to downgrade Enron until the day AFTER the shares were suspended? NOBODY KNOWS).

Existing Homes Sales were a little stronger than expected. Whoop de doo.

Fed Open Market Operations

One big repo ($10.75 billion), but not a signle dollar of it was in Treasury backed collateral. We are now in week 2 of Bernanke Watch - he is supposed to be resigning before Week 8.

Headline Indices

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The Dow Jones Industrial Average advanced +189.20 points (1.53%) to 12570.22 points. The index high for the day was 12584.62, while the low was 12341.04. The only Dow decliner was Citigroup - which is the most heavily manipulated stock on the NYSE big board. That is not a good sign if da Boyz decided to let it slide on a day like today.

Major Advancers in the Dow were

  • Alcoa Inc (AA) rose 2.3 (6.29%) to 38.85 on volume of 22.4 million units
  • Home Depot Inc (HD) rose 1.05 (3.78%) to 28.82 on volume of 20.9 million units
  • Amer Intl Group I (AIG) rose 1.5 (3.07%) to 50.38 on volume of 24.9 million units
  • Exxon Mobil Cp (XOM) rose 1.96 (2.25%) to 89.13 on volume of 23.8 million units
  • Chevron Corp (CVX) rose 1.76 (2.06%) to 87.18 on volume of 11.8 million units

Major Decliners in the Dow were

  • Citigroup Inc (C) fell -0.38 (-1.51%) to 24.74 on volume of 120 million units

Most Traded Dow stocks were

  • Citigroup Inc (C) fell -0.38 (-1.51) to 24.74 on volume of 120 million units
  • Microsoft Cp (MSFT) rose 0.16 (0.58) to 27.84 on volume of 109.9 million units
  • Intel Cp (INTC) rose 0.12 (0.61) to 19.94 on volume of 82.1 million units
  • Gen Electric Co (GE) rose 0.66 (1.97) to 34.21 on volume of 39.1 million units
  • Pfizer Inc (PFE) rose 0.28 (1.24) to 22.78 on volume of 38.6 million units

The S&P500 Index advanced +18.69 points (1.38%) to 1371.80 points. The Nasdaq Composite advanced +24.13 points (1.05%) to 2327.48 points and the Nasdaq100 advanced +12.02 points (0.68%) to 1785.46 points. The index high for the day was 1790.77, while the low was 1761.93.

The CBOE Volatility Index lost 1.03 points (4.28%) to 23.03 points. The CBOE Nasdaq100 Volatility Index advanced +0.37 points (1.41%) to 26.67 points.

Notice that? Tech volatility up on a big advancing day. Hmmmm... 

NYSE Total Volume totalled 3.85billion units, and Nasdaq Total Volume totalled 2.15billion units.

Major Market Statistics
Index Close Gain(Loss) %
Dow Jones Industrial Average 12570.22 +189.20 1.53%
S&P500 Index 1371.80 +18.69 1.38%
Nasdaq Composite 2327.48 +24.13 1.05%
Nasdaq100 1785.46 +12.02 0.68%
CBOE Volatiity Index 23.03 -1.03 -4.28%
CBOE Nasdaq100 Volatilty Index 26.67 +0.37 1.41%
NYSE Total Volume 3.85bn - -
Nasdaq Total Volume 2.15bn - -

Precious Metals

Precious metals futures are moving in about the right direction, given my bear call on Platinum last week. But I expect it will bounce tomorrow (it should have done so today) at which time we will get a second bite at a short-

Precious Metal Futures
Index Close Gain(Loss) %
Gold 942.1 -5.7 -0.6
Silver 1812.5 +9.0 0.5
Platinum 2154.0 -13.8 -0.64
Palladium 521.70 +5.85 1.13

Energy Complex

Energy futures are lulling spec longs into a state of boredom. Small spec long open interest is falling away, and pretty soon Crude is going to slice up through $100 and kiss it goodbye. There might be a lurch downwards first - five or six bucks in a session - but it's no lay-down misere.

Energy Futures
Index Close Gain(Loss) %
Crude Oil 99.22 +0.41 0.41
Heating Oil 2.7608 +0.0183 0.67
Gasoline RBOB 2.5423 +0.0086 0.34
Natural Gas 9.170 +0.024 0.26

The nine-stock group that makes up the Rant bellwethers declined on average by 0.3%. The fallout occurred as follows:

  • General Electric (GE) up $+0.66 (1.97%) to $34.21 on volume of 39.09 million units.
  • Citigroup (C) down $0.38 (1.51%) to $24.74 on volume of 119.98 million units.
  • Wal-Mart (WMT) up $+0.36 (0.72%) to $50.33 on volume of 25.53 million units.
  • IBM (IBM) up $+2.01 (1.86%) to $110.08 on volume of 8.14 million units.
  • Intel (INTC) up $+0.12 (0.61%) to $19.94 on volume of 82.07 million units.
  • Cisco Systems (CSCO) up $+0.20 (0.85%) to $23.80 on volume of 57.01 million units.
  • Google (GOOG) down $21.36 (4.21%) to $486.44 on volume of 8.34 million units.
  • Fannie Mae (FNM) down $0.45 (1.57%) to $28.27 on volume of 17.7 million units.
  • Freddie Mac (FRE) down $0.43 (1.62%) to $26.18 on volume of 18.51 million units.
Currency Futures
Index Close Gain(Loss) %
U.S. Dollar Index 75.585 +0.010 0.01
British Pound 1.9645 -0.0015 -0.08
Canadian Dollar 1.0026 +0.0182 1.85
Japanese Yen 0.9267 -0.0101 -1.08
Swiss Franc 0.9188 -0.0038 -0.41
Euro FX 1.4815 -0.0002 -0.01
Australian Dollar 0.9248 +0.0060 0.65
New Zealand Dollar 0.80780 +0.0033 0.41