Market Soapbox 05/12/05
Resistance: DJIA 10400; SP500 1180; Nasdaq 1980; NDX 1465
Support: DJIA 9900 ; SP500 1125 ; Nasdaq 1870; NDX 1375
Positive: internet, semis
Weak: Everything Else.
52 Week HiLo: NYSE 52/72; Nasdaq 43/88; Amex 22/42
A/D Volume: NYSE 371/1555, Nasdaq 829/890, Amex 15/236
Volume: NYSE 1.952B, Nasdaq 1.747B
Upcoming Notable reports:
FRI: Business Inventory (Feb 0.5%, est. 0.4%), Export Prices(ex-ag) Mar 0.4%, Import Prices(ex-oil) Mar 0.3%, Michigan Sentiment Prelim (Apr 87.7, est. 90.0)
Yesterday: Treasury Budget $57.7B est. $60B.
Initial Jobless Claims 340K (prior 336K, est. 325K); Retail Sales +1.4% (Mar +0.4%, est. +0.7%); (ex-auto) +1.1% (Mar +0.2%, est. +0.5%)
4K tax temps getting laid off, part of the 274K Mac Jobs created in Non Farms Report? Retail and Auto Sales way up, prices dropped, dealer incentives, must clear inventory.
European (DAX +0.54%) & Asian markets (Nikkei 225 -0.38%) were split. Dollar up MAJOR vs. Yen/Euro, gold, oil, commodities SLAMMED down, bonds up. 10 year note +6 ticks, yield -.026 @ 4.17%. Oil: -3.8%; below $49 @ 48.54. Contra action: None.
Today's Sooey Pig Pig!! award goes to BNP Paribas for spooking the herd into Treasuries. One of the 22 primary dealers of U.S. government securities that trade with the Fed's New York branch, commented AFTER the Retail Sales report:
``It's the death of the soft patch. We should be heading to higher rates on government debt given such reports (retail sales). The 10 year should rise to 4.42 within a month."
Mitsubishi Trust & Banking Corp also shares the award for these comments PRIOR to the report. ``The flight to safety from corporate bonds is not over yet.'' Yields may fall to 4.1 percent in coming weeks. Oink, Oink.
The Treasury Dept. sold $14B in the 10 year note auction, indirect bidder participation (foreign central banks) came in at a whopping 31.4%, compared to 11.7% in April.
Today the market was defrocked, not even falling bond yields and oil could save it. The market gapped down then recovered briefly, rallying up to get its split tape head just above the bowl rim by auction time, then the lid slammed down on its head as a loud whooshing sound could be heard emmanating from Wall Street.
10 of 10 sectors down on much higher volume. Todays worst performing sectors Energy -4.2% and Materials -2.9%; with YoY quarterly EPS growth of 42% and 64%?? Can you say parabolic runup, then re-tracement?
With the price of oil dropping, due to lower demand globally, and building reserves, transports, oil, gas, cyclical's, natural gas and gold got slapped down. Semi's caught a bid as more chumps and suckers rushed to fool's gold.
Wal Mart missed by a penny and issued lower guidance. Contrasting this bellwether to the Retail Sales report gives mixed results and indicates that the lower end consumer is being effected by the higher gasoline prices.
Mid and upper end consumers are still spending freely. Lower end consumers are skimping on small ticket items in an effort to save for big ticket items
Ford halted trading of commercial paper, and Moody's downgraded Ford debt from A3 to Baa2 to its lowest investment grade rating. Bonds got a bid and the dollar rose to a six month high vs Euro and gained over 1% against the Yen.
Last week and this week, we gave you a heads up on the bond auction & options unwind causing Tues, Wend, Thur consolidation action. So far this week: M, W up, Tu, Th down. We should see sideways action and a bounce up this Friday the 13th & Mon.
Next week, options expiration, GM derivatives fallout (hedgsters cash is tied up meeting margin calls) and CPI/PPI could slam the toilet lid down hard on the fingers of this market and then provide a nice healthy flush out. Tues is a pivital day to position for.
When the CPI & PPI come out Tues & Wen, this is when the market loses its grip on the rim as a DOUBLE courtesy flush occurs and we see MAJOR consolidation. Just my opinion, I could be wrong.
Support: DJIA 9900 ; SP500 1125 ; Nasdaq 1870; NDX 1375
Positive: internet, semis
Weak: Everything Else.
52 Week HiLo: NYSE 52/72; Nasdaq 43/88; Amex 22/42
A/D Volume: NYSE 371/1555, Nasdaq 829/890, Amex 15/236
Volume: NYSE 1.952B, Nasdaq 1.747B
Upcoming Notable reports:
FRI: Business Inventory (Feb 0.5%, est. 0.4%), Export Prices(ex-ag) Mar 0.4%, Import Prices(ex-oil) Mar 0.3%, Michigan Sentiment Prelim (Apr 87.7, est. 90.0)
Yesterday: Treasury Budget $57.7B est. $60B.
Initial Jobless Claims 340K (prior 336K, est. 325K); Retail Sales +1.4% (Mar +0.4%, est. +0.7%); (ex-auto) +1.1% (Mar +0.2%, est. +0.5%)
4K tax temps getting laid off, part of the 274K Mac Jobs created in Non Farms Report? Retail and Auto Sales way up, prices dropped, dealer incentives, must clear inventory.
European (DAX +0.54%) & Asian markets (Nikkei 225 -0.38%) were split. Dollar up MAJOR vs. Yen/Euro, gold, oil, commodities SLAMMED down, bonds up. 10 year note +6 ticks, yield -.026 @ 4.17%. Oil: -3.8%; below $49 @ 48.54. Contra action: None.
Today's Sooey Pig Pig!! award goes to BNP Paribas for spooking the herd into Treasuries. One of the 22 primary dealers of U.S. government securities that trade with the Fed's New York branch, commented AFTER the Retail Sales report:
``It's the death of the soft patch. We should be heading to higher rates on government debt given such reports (retail sales). The 10 year should rise to 4.42 within a month."
Mitsubishi Trust & Banking Corp also shares the award for these comments PRIOR to the report. ``The flight to safety from corporate bonds is not over yet.'' Yields may fall to 4.1 percent in coming weeks. Oink, Oink.
The Treasury Dept. sold $14B in the 10 year note auction, indirect bidder participation (foreign central banks) came in at a whopping 31.4%, compared to 11.7% in April.
Today the market was defrocked, not even falling bond yields and oil could save it. The market gapped down then recovered briefly, rallying up to get its split tape head just above the bowl rim by auction time, then the lid slammed down on its head as a loud whooshing sound could be heard emmanating from Wall Street.
10 of 10 sectors down on much higher volume. Todays worst performing sectors Energy -4.2% and Materials -2.9%; with YoY quarterly EPS growth of 42% and 64%?? Can you say parabolic runup, then re-tracement?
With the price of oil dropping, due to lower demand globally, and building reserves, transports, oil, gas, cyclical's, natural gas and gold got slapped down. Semi's caught a bid as more chumps and suckers rushed to fool's gold.
Wal Mart missed by a penny and issued lower guidance. Contrasting this bellwether to the Retail Sales report gives mixed results and indicates that the lower end consumer is being effected by the higher gasoline prices.
Mid and upper end consumers are still spending freely. Lower end consumers are skimping on small ticket items in an effort to save for big ticket items
Ford halted trading of commercial paper, and Moody's downgraded Ford debt from A3 to Baa2 to its lowest investment grade rating. Bonds got a bid and the dollar rose to a six month high vs Euro and gained over 1% against the Yen.
Last week and this week, we gave you a heads up on the bond auction & options unwind causing Tues, Wend, Thur consolidation action. So far this week: M, W up, Tu, Th down. We should see sideways action and a bounce up this Friday the 13th & Mon.
Next week, options expiration, GM derivatives fallout (hedgsters cash is tied up meeting margin calls) and CPI/PPI could slam the toilet lid down hard on the fingers of this market and then provide a nice healthy flush out. Tues is a pivital day to position for.
When the CPI & PPI come out Tues & Wen, this is when the market loses its grip on the rim as a DOUBLE courtesy flush occurs and we see MAJOR consolidation. Just my opinion, I could be wrong.
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