Market Observations 07/13/06
Initial claims +19K to 332K. Continuing jobless claims -18K to 2.4M. Full Report.
How bad is it out there?? Due to "stiff macro headwinds" and questionable forward sales growth, Merrill Lynch downgraded WalMart.
Crude hitting another all time high and gasoline futures @ $2.30 (highest since last Sept.) sent equities reeling again. Energy cost passthrough stagflation in the supply chain CANNOT be ignored.
Tepid response at the $9B 10 yr TIPS auction and subsequent PPT bond market (read interest rate) rescue plunged the equities market further into the RED.
High yield of 2.550%, bid to cover 1.76, down from 1.85. More importantly, foreign indirect bid @ 36.2% vs average 46.9%.
Tech still getting slammed, software YTD -10.9%, SOX -20% in the last 60 days.
200 DMA: NYSE sitting on, DJIA slicing through, SP500, MID, RUT, TMWX & OEX falling from.
400 DMA: OEX sitting on
600 DMA: NAZ slicing through and falling from.
800 DMA: NDX slicing through & SOX falling from.
The spread between 30 yr and 6 mo @ -15bps, the duration of the 2yr above 10 yr at over 5 weeks.
The severity of the current yield curve inversion is being downplayed by the hook in mouth media.
It's still a BIG thumbs down as we see further downside to RUT 670. Perhaps another summer "rally" headfake to short into, before an even greater plunge ensues.
How bad is it out there?? Due to "stiff macro headwinds" and questionable forward sales growth, Merrill Lynch downgraded WalMart.
Crude hitting another all time high and gasoline futures @ $2.30 (highest since last Sept.) sent equities reeling again. Energy cost passthrough stagflation in the supply chain CANNOT be ignored.
Tepid response at the $9B 10 yr TIPS auction and subsequent PPT bond market (read interest rate) rescue plunged the equities market further into the RED.
High yield of 2.550%, bid to cover 1.76, down from 1.85. More importantly, foreign indirect bid @ 36.2% vs average 46.9%.
Tech still getting slammed, software YTD -10.9%, SOX -20% in the last 60 days.
200 DMA: NYSE sitting on, DJIA slicing through, SP500, MID, RUT, TMWX & OEX falling from.
400 DMA: OEX sitting on
600 DMA: NAZ slicing through and falling from.
800 DMA: NDX slicing through & SOX falling from.
The spread between 30 yr and 6 mo @ -15bps, the duration of the 2yr above 10 yr at over 5 weeks.
The severity of the current yield curve inversion is being downplayed by the hook in mouth media.
It's still a BIG thumbs down as we see further downside to RUT 670. Perhaps another summer "rally" headfake to short into, before an even greater plunge ensues.
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