MONDAY 9/29/14; Hong Kong Protests; EU Launches Tax Probe Against AAPL; Personal Income and Outlays; CTAS

The Hong Kong tensions continue with officials threatening to call up the PLA (Peoples Liberation Army). The PLA is rarely deployed for protests and would dramatically escalate the tension and violence. Tear gas and pepper spray fills the air. The once peaceful Occupy Central protests have turned ugly and violent. As the sun rises for a new day and week ahead, protestors are blocking nearly 20 roads preventing commuters from traveling to work. Schools are can





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points, -0.3%, to 17071 bouncing between the 50-day MA support at 16939 and overhead 20-day MA resistance at 17100. The COMPQ is down 6 points, -0.1%, to 4506. The RUT is down one point, -0.1%, to 1118. AAPL loses -0.6% as the EU tax probe creates negativity.

Equity markets are weak due to the Hong Kong unrest, Brazil weakness ahead of elections, ongoing battles in Ukraine with soldiers dying despite the cease-fire and the airstrikes in Iraq and Syria. The VIX prints a HOD at 17.08 and closes at 15.98. The higher volatility is causing the large intraday and day to day point swings and Dow triple digit moves. When the VIX climbs above 20 the Dow point swings will be over 200 points daily.

After the closing bell, CTAS reports earnings in line with estimates up a touch over the prior year’s results. Cintas provides uniforms for businesses in manufacturing and healthcare industries and is an excellent economic indicator so the results verify a sideways stagnant economy growing at a snail’s pace. CSC gains +5.5% on news of a leveraged buyout. F loses another -1% in AH trading adding to the day’s losses.

FDX bounces after announcing a buyback. All hail the central banker easy money and financial engineering that pumps stock prices higher making the wealthy, that own stocks, wealthier. The near six years of central banker intervention is obscene causing Caligula to blush. The Fed has created excessive risk-taking in markets, buyback programs to boost stock prices and loss of price discovery across all asset classes. No one truly knows what any asset is actually worth anymore. How will it end?