Note - from June 24th 2009, this blog has migrated from Blogger to a self-hosted version. Click here to go straight there.
Across the street
A neon sign
Sayin' "All you can eat for a dollar ninety nine"
"Our Soul Food is the Baddest in the Land"
But one dollar's worth was all that I could stand
Cuz sometimes
Sometimes bad is BAD.
Ah, Huey Lewis and the News: is there no end to your homespun wisdom?
That lyric - that $1.99 all-you-can-eat was over-priced by about a dollar - was pop music gold.
Not as good as "Ridicule is nothing to be scared of" in Adam Ant's "Prince Charming", though.
But they're right - sometimes 'bad' is cool, but sometimes bad is bad. And the US economy is bad to the bone... not in a good way.
S
o we get to pose the same question as yesterday (even though the drive upward didn't 'stick' today). What drove a 400-point mid-session rally? Answer - now confirmed: it was good old 990N.
Well, not the original 990N from 2004 (which I referred to as "the quasi-mythical account that sticks 3000 lots on the bid in the S&P futures whenever things look shaky" mentioned in "Synchronous Decline? Perhaps not just yet..." from Sept 22, 2004).
It might not be 'the' 990N who used to clear through Gelber, and was clearly the US government's "go-to" dude for preventing declines. In the olden days, 990N would support a market at a given price level - preventing breaches of key levels by slapping huge bids a tick or two under the market... the same way brokers used to use 'U' orders in the Australian market to cap or support individual stocks.
Anyhow - these days, whoever is playing the 990N role, is prone to just buying everything in sight - slapping 2 or 3 thousand contracts' worth of demand into the S&P futures market.
The difference between today and 2004, is that this time the orders are actually being transacted. That's become necessary, because big fake buy orders that never get hit became passé.
In mid-2005 people started noticing that these 2 and 3-thousand unit orders that suddenly appeared in market depth, would disappear just as quickly if the price level they were set at, was reached: the entire order would move.
Thus 990N became redundant - he was a non-credible threat.
Anyhow... yesterday's rally, and today's big bounce off the lows, were driven by the US government (990N's bankroll comes from the taxpayer).
So why did the entire move - 400 Dow points from low to high - get given back in the last hour?
Simple - because 990N (or the 2008 version thereof) did not get anybody to join him in pushing up the indices: plus, there is the G20 this weekend. At that wankfest between the world's parasites, there is a decent chance of a move (led by China) to reduce the importance of the USD as a reserve currency. China is fed up with taking it up the vord - having to hold USD balances which are costing the Chinese government a large fortune - just so that flabby-armed Americans can buy more crap at WalMart..
So 990N and his backers did not want to hold over the weekend.
Economic News
- Retails Sales were down 2.8%, considerably worse than the expectation of a 1.9% fall. Excluding motor vehicles, the fall was 2.2%; and
- The preliminary reading on the University of Michigan Consumer Sentiment Index registered a slight increase from 57.6 to 57.9: the present conditions index rose from 58.4 to 61.4, while the Outlook index fell from 57 to 55.
Headline Indices
The Dow Jones Industrial Average lost 337.94 points (3.82%) to 8497.31 points. The index high for the day was 8923.18 (set at precisely 3 p.m.), while the low was 8469.99 - set less than a minute before the close.
The Dow Jones Industrial Average index (DJI) contains 30 components; the total volume traded in the index was 1.3bn units. Only 3 Dow components rose, and advancing volume was weak at 365.68m units; 27 issues fell, with declining volume of 965.32m units.
Today the index fell by 337.94 points (3.82%) to 8497.31 points. The main decliners (in percentage terms) were -
- Intel (INTC) -1.11 (7.7%) to $13.32 on volume of 74.09m shares;
- Home Depot (HD) -1.69 (7.6%) to $20.54 on volume of 24.8m shares;
- JPMorganChase (JPM) -2.72 (7.3%) to $34.47 on volume of 55.56m shares;
- Du Pont (DD) -1.86 (6.4%) to $27.43 on volume of 8.86m shares; and
- Caterpillar (CAT) -2.45 (6.2%) to $36.96 on volume of 11.86m shares.
The S&P500 Index lost 38 points (4.17%) to 873.29 points: the total volume traded in the index was 4.65bn units. Within the index, only 36 issues rose, and advancing volume totalled 777.42m units; 452 issues fell, with aggregate volume of 3.84bn units.
The main decliners (in percentage terms) were -
- Liz Claiborne Inc. (LIZ) -1.28 (25.8%) to $3.69 on volume of 4.58m shares;
- ProLogis (PLD) -1.76 (25.7%) to $5.08 on volume of 13.92m shares;
- Apartment Investment & Mgmt'A' (AIV) -3.17 (20.8%) to $12.09 on volume of 3.51m shares;
- Abercrombie & Fitch Co. (ANF) -4.65 (20.7%) to $17.79 on volume of 8.96m shares; and
- Office Depot (ODP) -0.41 (16.8%) to $2.03 on volume of 5.52m shares.
The Nasdaq Composite lost 79.85 points (5%) to 1516.85 points and the Nasdaq100 lost 61.3 points (4.94%) to 1179.63 points..
The total volume traded in the Nasdaq100 index was 1.07bn units. Within the index, 8 issues rose, with aggregate volume of 104.76m units; 90 issues fell, with aggregate volume of 968.38m units.
The main decliners (in percentage terms) were -
- Sears Holdings (SHLD) -6.28 (14.1%) to $38.27 on volume of 2.09m shares;
- Focus Media Holding (FMCN) -1.1 (13.6%) to $6.99 on volume of 4.5m shares;
- Amylin Pharmaceuticals (AMLN) -0.85 (11.7%) to $6.41 on volume of 2.8m shares;
- Liberty Media (LINTA) -0.38 (11.2%) to $3.01 on volume of 5.27m shares; and
- eBay (EBAY) -1.41 (10.2%) to $12.36 on volume of 24.45m shares.
Volatility
The CBOE Volatility Index advanced +6.48 points (10.83%) to 66.31 points..
The CBOE Nasdaq100 Volatility Index advanced +8.02 points (13.82%) to 66.05 points..
Breadth and Internals
A total of 3624 issues traded today on the NYSE; today's total volume was 1.62bn shares. A total of 773 stocks posted gains for the day, and volume in advancing issues totalled 880m shares. Exerting downwards pressure on the index were 2780 losers, which accounted for a total declining volume of 700m shares. 5 stocks made new 1-year highs on the NYSE, while 214 shares plumbed new 52-week depths. That stat goes in the 'contrarian bounce indicator' piile with a big red bow on it.
On the Nasdaq 2965 tickers traded today; total Nasdaq volume was 2.24bn shares. A total of 605 stocks posted gains for the day, with aggregate volume of 230m shares changing hands in the day's winners. The red zone of the Nasdaq exchange comprised 2261 losers, and total declining volume was 2.01bn shares. 5 Nasdaq-listed stocks hit new 52-week highs, while 289 shares dipped to new 1-year lows.
If there had not been that massive bounce yesterday, and another massive rally attempt today, the internals alone would justify having a crack on the long side starting an hour afer Monday's US open. I'll look at the rest of my data over the weekend, but I doubt that there is any merit in anything except a scalp long.
| Major Market Statistics | |||
| Index | Close | Gain(Loss) | % |
| Dow Jones Industrial Average | 8497.31 | -337.94 | -3.82% |
| S&P500 Index | 873.29 | -38.00 | -4.17% |
| Nasdaq Composite | 1516.85 | -79.85 | -5% |
| Nasdaq100 | 1179.63 | -61.30 | -4.94% |
| CBOE Volatility Index | 66.31 | +6.48 | 10.83% |
| CBOE Nasdaq100 Volatility Index | 66.05 | +8.02 | 13.82% |
Dow Darlings
- General Motors (GM) +0.06 (2%) to $3.01 on volume of 27.5m units
- Citigroup (C) +0.07 (0.7%) to $9.52 on volume of 280.9m units
Dow Duds:
- Intel (INTC) -1.11 (7.7%) to $13.32 on volume of 74.1m units
- Home Depot (HD) -1.69 (7.6%) to $20.54 on volume of 24.8m units
- JPMorganChase (JPM) -2.72 (7.3%) to $34.47 on volume of 55.6m units
- Du Pont (DD) -1.86 (6.4%) to $27.43 on volume of 8.9m units
- Caterpillar (CAT) -2.45 (6.2%) to $36.96 on volume of 11.9m units
Most Traded Dow stocks:
- Citigroup (C) +0.07 (0.7%) to $9.52 on volume of 280.9m units
- General Electric (GE) --0.84 (5%) to $16.02 on volume of 128m units
- Bank Of America (BAC) --0.68 (4%) to $16.42 on volume of 123.7m units
- Microsoft (MSFT) --1.19 (5.6%) to $20.06 on volume of 96.1m units
- Intel (INTC) --1.11 (7.7%) to $13.32 on volume of 74.1m units
Precious Metals
Precious metals futures advanced solidly -
| Precious Metals Futures | |||
| Index | Close | Gain(Loss) | % |
| Gold | 744.2 | 39.2 | 5.56 |
| Silver | 9.515 | 0.715 | 8.13 |
| Palladium | 220 | 6.05 | 2.83 |
| Platinum | 845 | 32 | 3.94 |
The Gold Bugs index (XAU) fell by 4.51 points (5.32%) to 80.2 points. It hass 16 components; the total volume traded in the index was 128.47m units. Within the index, only 1 stock rose, with aggregate volume of 1.28m units; 15 issues fell, with aggregate volume of 127.19m units.
The main decliners (in percentage terms) were -
- Kinroos Gold (KGC) -1.26 (9.3%) to $12.23 on volume of 17.48m shares;
- Newmnt Mining (NEM) -1.95 (7.4%) to $24.23 on volume of 8.75m shares;
- Freeport McMoran (FCX) -1.67 (6.4%) to $24.34 on volume of 19.78m shares;
- RandGold Resources (GOLD) -1.91 (6.4%) to $27.85 on volume of 1.1m shares; and
- Harmony Gold (HMY) -0.37 (5.6%) to $6.24 on volume of 2.75m shares.
Energy Complex
Energy futures continued toi place far too much emphasis on weak US demand, and continues to overlook the impending change in the USD - there is a very good chance that Oil will open with a large gap up on Monday.
| Energy Futures | |||
| Commodity | Close | Gain(Loss) | % |
| Crude Oil | 56.52 | -1.72 | -2.95 |
| Heating Oil | 1.83 | -0.045 | -2.4 |
| Natural Gas | 6.344 | 0.026 | 0.41 |
| Gasoline RBOB | 1.235 | -0.0674 | -5.18 |
| Ethanol | 1.661 | 0.013 | 0.79 |
The Oil Services index (OSX) contains 15 components; the total volume traded in the index was 116.17m units. Within the index, all 15 issues fell.
Today the index fell by 9.9 points (6.86%) to 134.42 points. The main decliners (in percentage terms) were -
- Global Industries (GLBL) -0.49 (15.1%) to $2.76 on volume of 1.96m shares;
- Smith International (SII) -3.35 (11%) to $27.12 on volume of 6.5m shares;
- Nabors Industries (NBR) -1.64 (10.8%) to $13.61 on volume of 9.66m shares;
- Rowan Co (RDC) -1.92 (10.7%) to $16.04 on volume of 3.97m shares; and
- Weatherford International (WFT) -1.23 (8.8%) to $12.8 on volume of 12.59m shares.
Currency Futures
Currency futures were all over the shop - why on earth the Euro should move in tandem with the Dow is beyond me, but that's what has been happening. It's idiotic - it probably means that there is a hedge fund blowing up..
| Currency Futures | |||
| Index | Close | Gain(Loss) | % |
| U.S. Dollar Index | 87.67 | 0.265 | 0.3 |
| Euro FX | 1.2778 | 0.0103 | 0.81 |
| Swiss Franc | 0.8437 | 0.0033 | 0.39 |
| Soybeans | 896 | 2 | 0.22 |
| Australian Dollar | 0.6639 | 0.0136 | 2.09 |
| Canadian Dollar | 0.8201 | 0.0051 | 0.63 |
| Japanese Yen | 1.0259 | -0.0117 | -1.13 |
| New Zealand Dollar | 0.5626 | 0.0007 | 0.12 |
Bellwethers
The nine-stock group that makes up the Rant bellwethers declined on average by 5.1%. The fallout occurred as follows:
- General Electric (GE) -0.84 (4.98%) to $16.02 on volume of 127.99m units.
- Citigroup (C) +0.07 (0.74%) to $9.52 on volume of 280.88m units.
- Wal-Mart (WMT) -2.22 (4.04%) to $52.71 on volume of 25.4m units.
- IBM (IBM) -3.88 (4.61%) to $80.33 on volume of 11.93m units.
- Intel (INTC) -1.11 (7.69%) to $13.32 on volume of 74.09m units.
- Cisco Systems (CSCO) -0.64 (3.71%) to $16.62 on volume of 68.37m units.
- Google (GOOG) -2.06 (0.66%) to $310.02 on volume of 9.49m units.
- Fannie Mae (FNM) -0.08 (12.9%) to $0.54 on volume of 26.39m units.
- Freddie Mac (FRE) -0.06 (8.22%) to $0.67 on volume of 16.91m units.
Other Indices of Interest...
The Banks index (BKX) contains 24 components; the total volume traded in the index was 727.85m units. Within the index, 1 stock rose, with aggregate volume of 280.87m units; 22 issues fell, with aggregate volume of 446.98m units.
Today the index fell by 2.73 points (5.34%) to 48.4 points. The main decliners (in percentage terms) were -
- Keycorp (KEY) -1.09 (10.2%) to $9.6 on volume of 8.21m shares;
- Northern Trust (NTRS) -4.88 (9.8%) to $44.92 on volume of 2.72m shares;
- Fifth Third Bancorp (FITB) -0.91 (8.7%) to $9.54 on volume of 7.94m shares;
- Bank Of NY Mellon (BK) -2.66 (8.1%) to $30.24 on volume of 10.89m shares; and
- State Street (STT) -3.34 (7.9%) to $38.89 on volume of 4.39m shares.
The Semiconductor index (SOX) contains 18 components; the total volume traded in the index was 249.86m units. All 18 index components fell.
Today the index fell by 13.76 points (6.4%) to 201.39 points. The main decliners (in percentage terms) were -
- Micron Technology (MU) -0.35 (11.3%) to $2.75 on volume of 27.78m shares;
- Infineon Tech (IFX) -0.32 (10.4%) to $2.77 on volume of 2.23m shares;
- Applied Materials (AMAT) -1.14 (10%) to $10.23 on volume of 19.49m shares;
- Advanced Micro Devices (AMD) -0.27 (10%) to $2.43 on volume of 21.47m shares; and
- Teradyne (TER) -0.4 (9%) to $4.05 on volume of 2.17m shares.
The ChildKiller ("Defence") index (DFX) contains 17 components; the total volume traded in the index was 165.39m units. Within the index, all 16 issues fell.
Today the index fell by 13.3 points (5.25%) to 239.84 points. The main decliners (in percentage terms) were -
- Gencorp (GY) -0.54 (17.1%) to $2.62 on volume of 0.36m shares;
- Teledyne Tech (TDY) -4.36 (9.8%) to $39.98 on volume of 0.26m shares;
- Esterline Tech (ESL) -3.36 (9.7%) to $31.23 on volume of 0.2m shares;
- FLIRr Systems (FLIR) -2.11 (6.6%) to $29.7 on volume of 2.11m shares; and
- General Electric (GE) -0.84 (5%) to $16.02 on volume of 127.99m shares.
