Thursday, October 30, 2014

FRIDAY 10/31/14; BOJ Shocks Global Markets with Double-Whammy Money Bazooka; Russia Central Bank Intervention; Global Short-Covering Rally; ABBV; XOM; CVX; CLX; D; WY; EOM (End of Month); Halloween Day; Chicago PMI; Consumer Sentiment; SPX, INDU, UTIL, IBB, XLV and AAPL All-Time Record Highs; COMPQ 14-1/2 Year Record High

The SPASX200 gains +0.5% driven higher by the Aussie banks. The KOSPI trades marginally lower dragged down by goliath shipbuilder Hyundai Heavy drowning -7%. Sony misses earnings forecasts and lowers guidance.

The Nikkei Index is sent higher in early trading following the US rally and on news that the Japanese Government Pension Investment Fund (GPIF) plans to increase the weighting in domestic and foreign stock positions by 25% across the board. The dollar/yen jumps to 109.40 and the weaker yen catapults the NIKK up +1.4%. Traders ignore the tame inflation and weak household spending data for Japan since the BOJ and government policies are focused on pumping the stock market higher. The equity markets are clearly manipulated by the central bankers and propped up by money printing.

After an afternoon policy meeting, BOJ Governor Kuroda shocks the markets by announcing more stimulus. Japan fires a double whammy money bazooka promising to buy 25% more stocks in the government pension fund as well as providing more easy money. Banzai!! The dollar/yen explodes higher to 111.57 (7-year low in yen). The NIKK rocket launches over +5% and settles up +4.8% to 16414 to a 7-year high. US futures catapult higher. S&P +21. Dow +180. Nasdaq +59. Euro 1.2573. Pound 1.5996.

The central bankers are the market and continue to pump the stock market with money printing for the last six years. The SIP data feed outage yesterday coincided with a purchase of 15000 E-mini S&P’s so obviously the  insider’s are told ahead of time so they can make easy stock market gains in a few hours time. Is Wall Street rigged? Of course it is.

The Japan decision is Abenomics on steroids and smacks of desperation since the inflation target of 2% remains difficult to attain. Japan is cheapening their currency through money printing. Global currency wars continue as nations compete in a race to debase; a race to the bottom. China indexes jump higher. SSEC +1.3%. HSI +1.3%. Aussie markets run higher on the news. SPASX200 +0.9%. Banzai!! The KOSPI also turns around finishing up +0.3%.

Since today is the EOM, the monthly charts are going to print a positive month and likely create a global stock market rally for a few months. Shock and awe from Japan! The actions by Japan smack of desperation but no one cares since Japan’s double-whammy money bazooka will allow long traders to rape the upside in equity markets with central banker easy money. Fundamentals and technical’s are tossed under the bus since central banks can create never-ending higher stock markets printing money continuously without consequences. At least for now.

Copper leaps higher gaining +0.8% to 3.09. Gold collapses 26 to 1172 which creates technical damage. Silver is down -2.6% to 16.00. Silver has lost nearly -8% of its value in only 48 hours. US Treasury yields are; 2-year 0.48%, 5-year 1.59%, 10-year 2.32%, 30-year 3.06%. German bund 0.84%. Japan 10-year yield 0.46%.

European indexes launch on the Japan double-whammy news. CAC +2%. IBEX +1.8%. DAX +1.6%. FTSE +1.2%. French banks are higher after BNP Paribas reports positive results. Royal Bank of Scotland sets aside $639 million to handle future litigation costs. BCS and C announced plans to set aside more funds for litigation yesterday. RBS moves +4% higher. The troubled Italian bank Monte dei Paschi is halted from trading after a near -3% drop. BMPS offes no clear plan on how to increase its capital position. The Italian bank trouble spreads with Banca Crige, another bank stress test failure, suspended from trading after a -2.4% selloff.

Euro zone inflation is up +0.4% in line with expectations, however, disinflation and deflation remain firmly on the table. Last month’s inflation read was +0.3%. Italy’s 10-year yield drops to 2.39%. Spain 10-year yield 2.12%. Greece 10-year yield is very erratic up over 50 basis points yesterday and down 14 basis points today to 7.94%.

The Russia central bank raises the key benchmark rate to 9.50%. The intervention was obvious yesterday as evidenced by the strength in the ruble. The Russian Ruble currency pair is 41.7261 which indicates a +0.6% strengthening of the ruble. Russian stocks are up +1.5% across the board. Russia and Ukraine reach a natural gas deal. The cease-fire in Ukraine loosely holds as the pro-Russian separatists are stepping up the fighting against Ukraine troops.

At 6 AM, S&P +23. Dow +196. Nasdaq +62. At 6:45 AM, S&P +24. Dow +196. Nasdaq +64. CAC +1.9%. IBEX +1.7%. DAX +1.7%. FTSE +1.1%. European indexes level off at the highs from the Japan excitement with Germany continuing to inch higher.

WTIC crude oil drops -0.6% to 80.65 and Brent falls -0.8% to 85.56. How comical, or perhaps tragic, it is to see oil reflect a slowing global economy while at the same time the central banks manipulate stock prices higher? Natural gas is up +3% to 3.94 working towards the psychological 4 level. The US 10-year yield is up a tick to 2.33%.

At 7 AM, S&P +23. Dow +195. Nasdaq +63. Dollar/yen 111.74.

At 7:05 AM, S&P +20. Dow +172. Nasdaq +57. Dollar/yen 111.71.

XOM reports blowout earnings 1.89 versus 1.71 expected on EPS and $107.5 billion top line versus $105.5 billion expected. Exxon increases the dividend +9.5%. CVX beats on the bottom line but misses on the top line. Both major oil producers are reducing production. ABBV beats and raises guidance bouncing +3.6% and adding lift to the biotech and pharma sectors. Futures remain elevated receiving a happy nod from the earnings releases.

Consumer staple CLX beats on earnings and rises +0.5%. HLT beats on earnings and raises guidance; the Ebola scare is not having an impact so the stock moves higher. COL beats on earnings. Lumber indicator WY beats on earnings and drifts marginally higher. NWL dumps -5% after beating on EPS but missing on the top line. The top line misses continue for many stocks but traders ignore this warning of weaker earnings ahead since the central banks support the markets.

At 8:30 AM, the Fed’s favorite economic metric, Personal Income and Spending, reports a miss. The Spending portion is down -0.2% and Income is up +0.2%. Higher numbers were expected for both components. Traders do not care since the BOJ is pumping global markets higher. Today is the EOM and the SPX started October at 1972.29. After the Japan double-whammy money bazooka, a positive month is on tap for the SPX reversing September’s down month. The Halloween holiday is the second largest retail spending holiday only surpassed by Christmas.

US futures remain strong. S&P +22. Dow +189. Nasdaq +60. Dollar/yen 111.59. 2-year yield 0.49%. 5-year 1.60%. 10-year 2.33%. 30-year 3.07%.

The trading session begins with equities launching higher continuing a global short-covering rally. The major indexes explode over +1% higher. The market bears are running for their lives. Semiconductors leap higher with SOX up +3.5%. MCHP +5.3%. INTC +3.7%. V continues running higher up +2% above 241 and Argus upgrades Visa setting a 260 price target. MHK, a housing sector bellwether, is upgraded and gains +5%. Interestingly, as stocks come on line, copper collapses and turns negative losing all gains in the overnight session.

DXJ, the Japan ETF, leaps +10%. The dollar/yen moves above 112. The stocks that reported earnings last evening and this morning launch higher except for Starbucks. GRPN +21%. LNKD +12%. XOM +1.3%. CVX starts out lower but turns higher up +1.1%. SBUX -2.2%. Chemical bellwether EMN bounces +7%. SAM, Boston Beer, the maker of Sam Adams beer, gains +7.2% on robust sales. The middle class and poor are drinking their troubles away. MBLY gains +2.4% on strong earnings. Blue chips IBM and MCD are sour spots trading down in the up tape. AEGR crashes -39% after reporting a loss, decreasing guidance and receiving downgrades. Gold is crushed -3% and silver is down -3.4%.

At 9:45 AM, Chicago PMI is a solid and very strong number at 66.2 above last month’s 60.5 and at a one-year high. The ordering components are all higher. Inventories are down so restocking will be needed especially if the weather turns cold a healthy economic sign. The Chicago PMI hints at a solid end to the year on tap but the data shows very little interest in cap ex spending by companies so economic softness should continue in 2015.

At 9:55 AM, Consumer Sentiment is 86.9 the highest since July 2007 adding more bull fuel for the stock market. On-line travel company EXPE jumps +3.2% on strong results. OWW is up +1.3% and PCLN +2.8% riding the Expedia coattails. PCAR is up +2% on an upgrade.

WTIC oil briefly falls under 80 and the average US gasoline price is at 3.00 per gallon slipping below. C gains +0.4% today the bad news last night about restating earnings long forgotten. Silly things like fundamentals, earnings, valuations and technical’s do not matter. All that matters is the central bankers pumping the stock market higher with easy money. Traders are partying like its 1999.

The Dow, IBB (biotech) and UTIL and XLU (utilities) print new all-time record highs. The Dow Industrials confirm the all-time highs on the Dow Transports which verifies the bullish rally from a Dow Theory perspective. TRAN, however, does not print a new all-time high today but is a hair away. Utilities may drift lower due to lackluster earnings from D. The Nasdaq prints a new 14-1/2 year high.

At noon time, the 2-year yield is 0.50%. 5-year 1.62%. 10-year 2.34%. Utilities, XLU and UTIL, are the only negative sector after printing new all-time highs this morning. 124 of the S&P 500 stocks (25%) are printing fresh new one-year highs including DIS, HUM, MMM and FDX. The market bullishness is off the charts. Traders are high-fiving each other in a euphoric celebration of central banker easy money. The only flies in the ointment are copper trading down and volatility remaining oddly elevated with the up tape.

At 1 PM, equities continue sideways at the highs. The SPX is up 20 points, +1%, to 2014. The Dow is up 181 points, +1%, to 17375. DD, JPM, V and INTC are leading the way higher. The Nasdaq is up 62 points, +1.4%, to 4628. The RUT is up 15 points, +1.3%, to 1170. Oil, gold, silver and copper all trail lower on the stronger dollar index with USD up +0.9% to 86.83. Euro 2527. The 10-year yield is 2.33%. Gold miners are slapped. NEM -7%. ABX -2.4%. AUY -8%.

The bullish sentiment is off the charts and more euphoric than when the stock market was at the all-time highs one month ago. Traders, analysts and economists remain continually bullish regardless of market direction. Princeton Securities NYSE floor trader Ben Willis says that stocks will end the year at new all-time highs. Money manager Ric Edelman says “buy the dips.” Mizuho Securities strategist Carmine Grigoli reiterates his SPX 2150 target and says this may be conservative (he expects the SPX to print even higher). WFC manager John Manley says all the metrics that pushed stocks higher remain in place. Manley says, “We are not at high valuations” and “nowhere close to a bear market.”

A Virgin Galactic air ship, owned by billionaire Richard Branson, crashes in the Mojave Desert during a test flight. One pilot is killed and another severely injured. Virgin Galactic is striving to provide the first commercial space flight service for the general public at $250K per ride. The first commercial flights were supposed to occur this year but had already been pushed forward to early 2015. Are you ready to sign up? Interestingly, Russian rocket engines were used for both the Virgin Galactic tragedy and the rocket explosion that occurred on the launch pad in a separate incident two days ago although the story is developing. The fuel formula is believed to be the cause of the tragedy. The Virgin Galactic program suffers a serious setback and the first commercial space flights will likely be delayed into 2016 or later.

At 3 PM, the SPX is at 2012 dancing to and fro along the September all-time closing high at 2011. The all-time intraday high is 2019.26 on 9/19/14 and the all-time closing high is 2011.17 on 9/18/14. The SPX is up 18 points, +0.9%. The Dow is up 153 points, +0.9%, to 17347. The COMPQ is up 53 points, +1.1%, to 4619. The RUT is up 15 points, +1.3%, to 1171. The computerized trading robots are taking over late day moving the four major indexes higher in unison.

Farm Prices show the low grain prices continuing. The CORN ETF is down about -50% off its 2012 high but has recovered about +14% over the last month. The JO coffee ETF has doubled over the last year but falls -18% over the last month. SGG, the sugar ETN, has collapsed from the 2011 top at 105 to 40, -62%, however, the weekly chart is positively diverged from a technical perspective and likely an attractive candidate for a long play. Ditto the CANE ETF. Sugar may become sweet again for the months ahead.

In the final one-half hour, there is $1.7 billion in orders to buy, the highest level seen in many weeks, which will push the market up to the intraday highs into the closing bell. Sure enough, the SPX is pumped higher starting at 3:24 PM at 2010 and ending at 2018 at the closing bell an eight-handle move, +0.4%.

The day ends with the equity markets gapping higher on the Japan stimulus that creates a global short-covering rally. Halloween is a trick for the bears and treat for the bulls. The SPX gains 23 points, +1.2%, to 2018 exactly as the S&P futures indicated when the Japanese shock and awe was announced overnight. The SPX prints a new all-time closing high at 2018.05 but the all-time intraday high remains in place at 2019.26 from 9/19/14. The HOD is 2019.19 falling only about a buck short of printing a new all-time record intraday high.

The Dow is up 195 points, +1.1%, to 17391, printing a new all-time intraday high at 17395.54 and new all-time closing high at 17390.52. The Dow Industrials print new highs confirming the new highs in the Dow Transports from a Dow Theory perspective signaling further upside in the broad indexes. The trannies, however, were unable to print a new high in today’s action.

The COMPQ gains 65 points, +1.4%, to 4631, a new 14-1/2 year record high. The Nasdaq is nearing 5K the peak of the dotcom bubble in early 2000. The Russell 2000 Index gains 18 points, +1.5%, to 1174 lagging the other major indexes and not yet back to the July all-time record high above 1210.

For the week, the SPX gains +2.7% building on last week’s strong gains. The Dow is up +3.5% on the week and the COMPQ gains +3.3%. The RUT small caps explode +4.9% during the week. The NYA gains +2.5%. Semiconductors print a strong recovery with the SOX up +4.7% this week. Biotech stocks, IBB gain +2.7%. Financials, XLF, are up +3.2% this week. Energy lags with XLE up +2.1%.

The twelve-day rally is a phenomenal parabolic move higher that began with Fed’s Bullard comments that more QE is on the way. In about two weeks time, the SPX moves from 1820 to 2018, a huge 200 handle turnaround, nearly +11%. The power of the central bankers is impressive although obscene. Free markets died in late 2008 and early 2009 when the Fed bailed out the banks and other companies such as AIG and GM and began the quantitative easing. The Dow moves from 15860 to 17396, 1536 points, nearly +10% over the last few days. The COMPQ is up from 4123 to 4642, a ridiculous 519 points, nearly +13%! The RUT rallies from 1040 to 1174, 134 points, +13%! Major indexes simply do not move over +10% in a matter of days unless goosed by the central bankers.

The dollar/yen is 112.31 a huge move this week considering the currency pair was under 109 only one day ago. This is an obscene move for currencies but the power of the central bankers appears limitless. Euro 1.2533. Pound 1.60. The USD dollar index is 86.913 up from 85.200, +2%, in only 48 hours time. The Japanese yen, XJY, weakens due to the BOJ money printing, collapsing from 92.60 to 89.04, -3.8%, over the last three days. The central banks are the market. The 10-year yield is 2.34%. The Japan 10-year JGB yield is a paltry 0.457%.

The utility sector, UTIL and XLU, print new all-time record highs before retreating and ending the day negative in the up tape. UTIL tops at 599 and XLU at 45.63. The weekly uptrend in utilities signals a strong stock market moving forward. The biotech sector continues to pound higher with IBB printing a new all-time high at 303 before retreating to the flat line. The healthcare sector also prints new all-time highs with XLV at 68. There are new all-time highs in many other sectors and stocks.

AAPL prints another new all-time record high above 108 for the 38th record high of the year. CNTL, a potential takeover target, jumps +13%. C finishes +0.7% higher despite the restatement of earnings. Banking analyst Mike Mayo, using a Halloween metaphor, says, Citigroup is “like free candy at these prices.”

The bullish parade of sentiment by traders and analysts is unstoppable. CNBC television commentator Robert Frank says, “Stay in the market even when it’s tough.” UBS strategist Jim Lacamp says headwinds have become tailwinds and he comments on the ongoing Keynesian stimulus saying, “the market likes it and it will keep us going for a while.” Matrix Asset Advisors strategist David Katz says November and December are typically good months for the stock market and “Stocks will trade higher.” As the stock market prints new all-time record highs, key economic bellwether copper sells off, a coupon company, GRPN, catapults +22%, and the camera-on-a-stick company, GPRO, jumps +13%. What does this tell you?

When traders were expecting the ECB to pump the markets higher with stimulus, instead the Japanese government pension fund and the BOJ fire a double-whammy money bazooka creating a shock and awe wave of easy money. Traders expect a further upside orgy with ECB President Draghi announcing stimulus next Thursday at the ECB meeting or in the weeks ahead. The central bankers are the market; can it be any more obvious? Bullish traders are celebrating into the weekend raping the market upside with the central banker’s easy money.

Wednesday, October 29, 2014

THURSDAY 10/30/14; Russian Ruble Collapse and Intervention; COP; K; MA; MO; Q3 GDP; European Indexes Recover Strongly Intraday; UTIL and IBB All-Time Record Highs; Former Fed Chairman Greenspan Says "Buy Gold"; SIP Outage; EMN; GPRO; LNKD; MHK; MYL; NEM; SBUX; YRCW; C Restates Earnings

Asian indexes are setting up positively except for Korean negatively impacted by a drop in Samsung profits. The NIKK trades +0.5% higher in the early going. The dollar/yen tags 109.00 driven higher by

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m the 1040  low to 1159, 119 points, +11.4%. The bullish sentiment remains in the markets wheCitigroup will have to set aside funds for the litigation costs, fines and fees coming in the future. Traders are concerned that other banks are going to be involved in the same mess.

The earnings season continues with 331 of the S&P 500 stocks reporting thus far (66% of the SPX stocks). 76% of the companies have come in above expectations, 6% meet and 18% miss expectations.

Tuesday, October 28, 2014

WEDNESDAY 10/29/14; 85th Anniversary of the 1929 Stock Market Crash "Black Tuesday"; ADP; ETN; GT; HSY; RL; TRAN, UTIL and AAPL Print New All-Time Record Highs; FOMC Rate Decision; Fed Ends QE Infinity; V; KRFT; BIDU; DWA; IPI; KS

Asian markets are set to move higher feeding off the positivity in the US. The NIKK is up +1% out of the gate and running higher with the dollar/yen at 108.17 heading higher. Banzai! Japan Factory Output data is above expectations and growing at the fastest rate in 10 months adding to the stock market joy. 

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nst the wealthy elite class. The wealthy may be destined to live in gated communities like caged animals protected by security guards.

Russia flies military planes across international air space above the Baltic States and other areas of Asia. NATO planes are intercepting and diverting the Russian aircraft creating trouble in the skies not seen since the cold war. President Putin steps up the rhetoric against the Europe and begins an anti-American campaign. The intent of the military flights and bluster are unclear but tension is increasing as the Russian Ruble currency collapses.

TUESDAY 10/28/14; Russian Ruble Collapse; PFE; DD; SHW; WHR; COH; Durable Goods; FOMC Two-Day Meeting Begins; Consumer Confidence; US Stocks Rally; TRAN, UTIL, IBB and AAPL New All-Time Record Highs; BABA Hits 100; NYA Above 40-Week MA Signaling Cyclical Bull Market; FB; GILD; X

Asian markets are mixed. Japanese stocks trade lower with the NIKK dropping -0.4% as the dollar/yen remains well under 108. Softbank buys India’s Snapdeal, a growing platform of e-commerce for small business that w

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definition a communist country passes down edicts that are followed and never questioned. Beijing is likely losing patience with the demonstrators and perhaps a stronger crack down occurs moving forward to crush the movement.

Monday, October 27, 2014

MONDAY 10/27/14; European Bank Stress Tests Aftermath; Russian Ruble Collapses; MRK; UTIL and IBB All-Time Record Highs; TWTR

The NIKK gains +0.6% since the dollar/yen remains above 108. Japanese banks launch higher with all 11 major banks printing positively. Daihatsu is down -2% on a GS downgrade. SPASX200 gains +0.9%. Aussie banks are up from +1% to +2% across the board with all six of the major ban

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T is increasing its market share in the used videogame market providing more competition to GME.

90 companies in Silicon Valley are priced over $1 billion in value when last year at this time the tally was only 30; a three-fold increase. Venture capitalists are tripping over each other chasing and throwing money at the latest tech start-up ideas. Does this signal a bubble in tech?

Sunday, October 26, 2014

SUNDAY 10/26/14; 25 European Banks Fail Stress Tests; Brazil Election

At 7 AM, the ECB releases bank stress tests failing 25 European banks as the preliminary leaks reported. Greece, Italy and Portugal banks are weak. German banks held up well for the stress tests which will provi

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g will be anticipated. EWZ, PBR and VALE will see active trading likely opening strongly lower. The Brazil Bovespa Index begins at 51941 and the Dollar/Brazil Real currency pair is 2.4739. Traders and analysts project the Bovespa to drop to 48K during the weeks ahead. Brazilians realize the economy is in rough shape and difficult times will remain ahead so they vote for the devil they know rather than the one they do not know.

Saturday, October 25, 2014

SATURDAY 10/25/14; Operation Inherent Resolve (ISIS War) Claims Second US Soldier Death and First Death in Iraq Since November 2011; "Obola"

TWTR reports a problem in viewing and sending tweets but claims the situation is fixed. Twitter accounts are affected in the US, UK, Spain, France, Germany, Poland and Turkey, as well as other countries. The ‘Backoff’ 

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those unhappy with his flaccid response to the Ebola outbreak label America’s malaise as “Obola” (combining Obama and Ebola) and an #Obola hashtag goes viral on TWTR. President Obama does not have a care in the world as he spends several hours on the golf course today relaxing and having fun.

Thursday, October 23, 2014

FRIDAY 10/24/14; Ebola Infection Confirmed in New York City; PG; F; UPS; New Home Sales; Russian Ruble Collapse; UTIL All-Time High; US Stocks Rally Huge This Week

The Wall Street joy cascades around the globe with Asia waving a happy flag to begin the day. The NIKK launches +1.6% using the weak yen bull fuel. The dollar/yen remains elevated at 108.20. Aussie SPASX

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 banks in Spain and France perform better than expected through the stress tests as evidenced by Monte Paschi’s large +11% gain today. The ECB releases the bank stress test results on Sunday at 7 AM EST; noon European time.

THURSDAY 10/23/14; Global PMI's; CAT; MMM; GM; LLY; KKR; PHM; RTN; UA; US Stock Rally; UTIL, AAPL, FB, HD and Other New All-Time Record Highs; Leading Indicators; AMZN; MSFT; DECK; FLS; SWFT; YNDX

China HSBC Flash PMI is 50.4 at a three-month high above last month’s 50.2. The factory output data, however, c

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th confirmed cases of Ebola. The deadly virus has killed about 4900 people over the last few months. The new moon occurs this evening for the month of October and the stock market is typically weak moving through the new moon (about 65% of the time).

Tuesday, October 21, 2014

WEDNESDAY 10/22/14; Global Rally Sputters; Hong Kong Unrest; 11 European Banks May Fail Stress Tests; BOE Minutes; BA; BIIB; DOW; IR; R; LL; NSC; CPI (Consumer Price Index); UTIL adn AAPL New All-Time Record Highs; Canada Shooting Rattles Stock Market; T; NXPI; YELP

The NIKK is up a huge +2.6% regaining the 15K level nearly at 15.2K feeding off the US joy. The dollar/yen remain

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cial Security recipients will receive a cost of living adjustment of +1.7% for next year adding about $20 per month to the average monthly check. A man jumps the fence at the Whitehouse but is immediately apprehended by the Secret Service.

Canada PM Stephen Harper says “Canada will not be intimidated.” Harper labels the tragic shooting as an act of terrorism. Investigations are continuing to determine if others are involved in the attack and to what extent ISIS may be involved.

Monday, October 20, 2014

TUESDAY 10/21/14; China GDP; ECB Stimulus and AAPL Create Record Stock Market Rally; MCD; LMT; KO; KMB; UTX; VZ; Existing Home Sales; YHOO; DFS; VMW

Asia is tentatively set to move higher waiting for a huge Chinese data dump including Q3 GDP, industrial output, retail sales and fixed asset investment. The AAPL earnings beat should create positivity espe

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own of Kobani.

MONDAY 10/20/14; Asia Stock Rally; Hong Kong Unrest; Ebola Fear Subsides; IBM; HAL; AAPL; PKG; CMG; US Stocks Continue Relief Rally

Hong Kong leader Leung says the “street protests are out of control.” Pepper spray fills the air and is combated by a line of umbrellas as the pro-democracy demonstrations enter the fourth week. Police use bat

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e of a robust economy. STLD misses on EPS but beats on the top line and rises +0.8%. Texas Instruments beats on EPS by a nickel but barely beats on the top line. TXN jumps +2.5%. ZION drops -1% after reporting earnings.

SUNDAY 10/19/14

North Korea and South Korea soldiers exchange small arms fire at the border. South Kore

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The CCL cruise ship carrying the potentially-infected Ebola patient docks in Galveston, Texas, after Mexico and Belize refuse docking privileges. The patient is removed from the ship and preliminary blood tests prove negative for Ebola.

Saturday, October 18, 2014

SATURDAY 10/18/14; Hong Kong Violence

The Hong Kong violence increases on the weekend. Pro-democracy demonstrators are clashing with police t

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s Angeles are living below the poverty level. Washington, DC, has a poverty rate of 22.4% and Nevada state is 20%.

Friday, October 17, 2014

FRIDAY 10/17/14; Global Markets Stabilize as Central Bankers Intervene; Greece 10-Year Yield Hits 9%; Russian Ruble Collapsing; OpEx; GE; MS; STI; BK; HON; KSU; Housing Starts; Consumer Sentiment; US Stocks Rally; Russia Debt Downgrade

Asian indexes trade mixed. The NIKK tanks -1.4% to 14.5K. The Nikkei logs the worst week down -5% in six months. Japanese exporters are smacked in the face across the board. Canon loses -2%. TM collapses nearly -4%. Chinese banks are weak sending the SSEC down -0.6%. The PBOC plans to inject 20

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 all other asset classes.

At 11:05 AM EST, all OTC (over-the-counter) trading is halted due to technical issues with the data feeds. NYSE and Nasdaq trading is not affected. OTC trading systems are off line unable to update quotes. FINRA lifts the halt at 12:45 PM EST and normal trading resumes after 1 PM. The obscure ‘technical glitch’ excuse is blamed and the incident is swept under the rug. The flash crashes, flash spikes and software failures occur with frequency across all exchanges.

The Whitehouse names Ron Klain, an inside politician to President Obama and Vice President Biden, as a new Ebola Czar that will oversea the growing Ebola crisis. Klain has no medical experience. The Ebola virus was believed to take a 21-day incubation period before the fever and symptoms appear but some medical reports say it may be up to 42 days. H and HLT bounce +4% each after receiving upgrades. The beaten down hoteliers recover from the negative Ebola talk.

Rumors circulate trading floors that the Russia-Ukraine peace talks are making progress in Milan which maintains stock market buoyancy. FB, AAPL and other Silicon Valley companies are offering an egg freezing program for female employees. The new technology provides an option for women to have children later on in life and the program receives mixed reviews.

Billionaire Mark Cuban tweets that he is buying NFLX hand over fist since it is a great potential takeout opportunity. NFLX drops -3% reeling from its -20% collapse yesterday. Cuban may have rode Netflix shares lower and is trying to right the ship. Fellow Shark Tank television show celebrity personality Kevin O’Leary is optimistic on the stock market and says he is buying dividend stocks. CSX rides the rails higher gaining +2.7% and up a huge +13% this week.

The day ends mixed with the Russell 2000 small caps lower and the broad market and tech higher. The SPX is up 24 points, +1.3%, to 1887 unable to close above the 50-week MA at 1888 or the critical 12-month MA at 1895 even though these prices were taken out intraday. The Dow gains 263 points, +1.6%, to 16380 rejected by the 50-week MA at 16495. The COMPQ is up 41 points, +1%, to 4258, intraday back testing the 200-day MA at 4302. The RUT loses 4 points, -0.4%, to 1082.

Traders are in a buying frenzy at the opening bell with the TRIN printing an uber low at 0.23 verifying excessive intraday bullish euphoria. That led to the afternoon lull as the day and week finished. Volume is tame nowhere near the robust selling days during the week. GS gains +2.5% and MS +2.1% after reporting earnings. Financials, XLF, are up +1.3%. SHLD lost -5.3% creating a dark cloud over the holiday retail season. TXT is a huge winner up +9%.

Industrial stocks leap higher with XLI +2%. Healthcare stocks, XLV, are pumped +1.6% higher. Homebuilders receive favored status today with XHB up +1.6% and up +2.6% on the week. LEN and PHM are up +7% this week so traders are looking for strength in the housing numbers going forward. The defense and war stocks fire higher with RTN, NOC and UTX each up +2.3% and HAL gaining +2.8%. Biotech, IBB, gains +1.7% with REGN  up +8.5% and GILD gaining +4%. CMRX -3.5%. AAPL is up +1.5%. remaining under 98.

For the week, the indexes are negatively impacted by Ebola fears and the collapse in oil prices. The equity markets place a near-term bottom after the world’s central bankers promise more stimulus; starting with the Fed’s James Bullard that hints at more QE ahead. The SPX and Dow each lose -1%. The SPX prints negative on the year under 1848 on both Wednesday and Thursday. The COMPQ is down marginally this week to -0.4% and the RUT finally bounces +2.8% from a six consecutive week down trend.

The RUT remains in correction territory (down -10%) under 1093. The Nasdaq top is 4611 on 9/19/14 so -10% is the 4150 level which was breached two days during the week but price closes above avoiding correction territory. The Dow topped at 17351 on 9/19/14 so -10% is the 15616 level. The Dow has not threatened a full correction as yet illustrating how the blue-chip dividend and defensive stocks are holding up better than the broad market. The SPX topped at 2019 on 9/19/14 so -10% is the 1817 level and price came down to 1820 intraweek only a whisker from correction territory.

WTIC crude oil is the big story collapsing to a 79-handle but then recovering strongly to near 85 before ending the week down -3% to 82.92.  Oil has dropped  from 107.50 to 80 in 17 weeks; -26% bear market territory. Gold gains +1.2% this week to 1239 printing two consecutive weeks of upside off the 1184 low 10 days ago. Treasury yields take a roller coaster this week with the 10-year dropping to 1.86% then recovering back above 2.20% in wild trading. Mortgage rates are dropping which will encourage folks to refinance their home. Greece’s 10-year yield moves above 9% creating additional concern over this troubled nation in depression.

GS reports a $100 million mistake when advising Vista Equity Partners on the TIBX acquisition. Vista will pay $4.2 billion for TIBCO Software rather than the original $4.3 billion. TIBX shareholders will receive less than thought on the deal. The error is swept under the rug on a Friday evening to maintain Goldman Sach’s reputation.

Moody’s downgrades Russia’s debt rating from ‘Baa1’ to ‘Baa2’ following S&P’s downgrade five months ago. Moody’s cites the ongoing Ukraine civil war and lowered economic expectations as reasons for the downgrade. Even though a cease-fire remains in effect in Ukraine, both government troops and the pro-separatist (Russia-leaning) soldiers continue to fight and die in small skirmishes. The drop in oil price is killing the Russian economy since oil and gas reserves are the major component of its GDP. The collapse in the ruble may create a currency crisis in Russia. Russia’s central bank intervened this week to support the ruble.

Thursday, October 16, 2014

THURSDAY 10/16/14; Global Selloff Reversed by Bullard Rally; WTIC Oil Loses 80; BX; GS; CY; PM; PPG; UNH; Industrial Production; Philly Fed; Fed Speak; GOOGL; AMD; SNDK; COF

Asian indexes trade lower following the negativity in the States. Australia is the lone bright spot ending marginally higher recovering from intraday losses as banks and energy companies move higher. The Aussie dollar is 0.8768 continuing lower. The NIKK is whacked -2.2% down a huge 335 points to 14738. The stronger yen with dollar/yen down to 106 creates negativity. Auto makers TM and HMC trade lower.

The SSEC and HSI each end -0.7% lower. Chinese real estate and steel companies are beaten while banks trade

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a Capital Research, a small HFT firm for price manipulation on Nasdaq stocks. The firms high-frequency trading algorithm, called Gravy, floods the exchanges with orders and then quickly pulls the orders, everything occurring in milliseconds, to benefit from the imbalance created. The SEC is likely bringing litigation against smaller companies to learn more about HFT and then set sights on the bigger fish in the ocean.

5-1/2 trillion dollars of value is wiped off global equities since the stock markets topped out in September. This loss compares to the size of the UK and Japan economies combined; wiped out in only a few weeks time.

Wednesday, October 15, 2014

WEDNESDAY 10/15/14; Hong Kong Violence; Greece 10-Year Yield Above 7%; BAC; BLK; PPI; Empire State Mfg Index; Retail Sales; US 10-Year Yield Drops to 1.868%; US Stocks Collapse and Recover; Beige Book; AXP; EBAY; NFLX; URI; Operation Inherent Resolve

The Hong Kong protests turn violent and ugly with pro-democracy demonstrators and police clashing in the worst violence since the initial evenings of the protests about two weeks ago. Police are beating the students with batons. A video shows police pulling a protestor from the crowd and beating him to the point where he had to be rushed to the hospital. Hundreds of Hong Kong police use pepper spray on the protestors while continuing to disassemble and remove the barricades. Th

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URI, a darling of long traders for the last two years, reports an earnings beat on top and bottom lines and gains +2.2%. Las Vegas Sands earnings EPS is in line but the top line is light. LVS trades +1.9% higher after announcing a divvy increase.

The Whitehouse finally names the military operation in Syria and Iraq calling the mission “Inherent Resolve” which is met with moans. Usually the names denote stronger themes to encourage the troops such as Operation Desert Storm. Operation Inherent Resolve is an odd selection and the president’s detractors instead call the new war “Incoherent Resolve”. President Obama is taking the ISIS radicals and Ebola outbreak more seriously cancelling several fund-raising parties. With the world spinning out of control, Americans are happy to see the Commander in Chief at the Whitehouse providing leadership. 

Monday, October 13, 2014

TUESDAY 10/14/14; Global Markets Attempt Stabilization; US 30-Year Bond Yield Under 3% and 10-Year Note Yield Under 2.20%; German Bund Record Low Under 0.85%; JPM; C; WFC; JNJ; Crude Oil Collapses; INTC

Japan is open for trading after the holiday and plays catch-up to the US by tanking -2% out of the gate. The dollar/yen pair leaks lower to 107.13 so the stronger yen pounds Japanese stocks. Auto makers are puking in the early going with TM, Nissan and Suzuki down from -3% to -4%. Aussie miners are r

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ILD -4.2%. The luster is coming off the biotech and pharma rose. DPZ is up +11% continuing the pizza party all day long. One-trick videogame pony KING collapses -7%.

Crude oil is crushed losing over -4%. WTIC oil collapses under 82. Copper is a bright spot today gaining +1.2%. The Canadian Dollar (loonie) is at a five-year low. The loonie falls 0.7 cent printing 88.45 cents US. Bond guru Jeff Gundlach says the 2.20% level should serve as a bottom for the 10-year yield going forward.

After the closing bell, INTC reports EPS at 0.66 versus 0.65 beating by a penny. Top line beats at $14.55 billion versus $14.45 billion expectations. The beats appear tame but traders love the news sending Intel strongly higher in AH trading up +1.7%. INTC reports the highest ever Q3 earnings in its history and will help boost the Nasdaq tomorrow. CSX earnings keep the party going with EPS at 0.51 versus 0.48 expectations and top line sales at $3.22 billion versus $3.15 billion expectations. CSX trades higher sending other railroads such as UNP higher. Note the top line revenue numbers remain challenged across all sectors.

Sunday, October 12, 2014

MONDAY 10/13/14; Cascading Global Selloff Continues; Hong Kong Tension; Columbus Day; US Bond Market Closed; Canada Thanksgiving Day; US Stocks Collapse; SPX Loses 200-Day MA, 12-Month MA and 50-Week MA

At 7 AM local Hong Kong time 7 PM EST), the police are mobilized removing barricades and beginning to clear the streets. Lines of police officers are assembling a short distance from the pro-democracy Occupy Central students and city officials say they are “taking back government property.” The communist crack down begins and tensions run high but the day remains peaceful so 

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ductors). GPRO dumps another -2% in AH trading. The CPC put/call ratio spikes to 1.53 indicating rampant fear and panic today so a recovery rally is expected.

American consumers are receiving relief at the pump with gasoline at a limited number of stations selling at $2.99 per gallon for unleaded regular. Lower gasoline sales may help retail holiday sales; however, folks may instead spend the savings on necessities since times are bad for the middle class and the poor. Conversely, the upper middle class and wealthy are on easy street thanks to the Fed’s easy money policies. The middle class in America is only a quaint memory.

Cable news outlets are feeding the Ebola fear in the evening. Confidence in the CDC is being lost each day since they paint a rosy picture but the Ebola pandemic grows. American’s feel they are not being told the truth about Ebola. In North Korea, Kim Jong Un appears in public for the first time in 40 days.

SUNDAY 10/12/14; World War, Disaster and Disease; Hong Kong Blue Ribbon Movement; Ebola Spreads inside US

The skies are gray in the Asian theatre. Typhoon Vongkong hits southern Japan but the storm’s strength has dropped considerably. Nonetheless, power outages are rampant and floods are destroying businesses and property. Cyclone Hudhud with 120 MPH (195 KPH) winds hits India’s east coas

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hat enjoys the Caligula-style daily toga party in markets while the middle class and poor eat franks and beans not even able to afford the moderately-priced ground beef at the local supermarket.

Saturday, October 11, 2014

SATURDAY 10/11/14; ISIS Overtaking Kobani and Preparing for Attack on Baghdad

Monster Typhoon Vongfong continues to push towards Japan nearing the southern Okinawa Islands and the winds have diminished to 40 to 85 MPH (64 MPH to 137 KPH). In North Korea, Kim Jong Un’s absence remains a concern. News reports say the young communist leader pulled a tendon requiring three months of rest, however, there may be more dramatic events taking place behind the scenes including a potential coup. North Korea has the nuclear bomb.

ISIS militants control about one-half of Kobani and a couple thousand Kurds are trapped in the city unable to escape. If ISIS takes the remainder of the Syria-Turkey border town, the remaining people face torture and genocidal murder. US and coalition air strikes are helping but generally ineffective. Kurds inside Turkey are fighting the police and government forces for refusing to help the Kurds in Kobani. 200K refugees have fled from Syria into Turkey.

Iraqi troops in Baghdad are preparing for a battle with ISIS radicals that are now only eight miles from the capital city. ISIS has taken over territory north, west and south of Baghdad establishing bases of operation for assaulting Baghdad. ISIS will probably attack the airport first which includes the green zone that was held by US troops during the Iraq War. The world will turn on its head and global markets will react negatively if a bloody war in Baghdad occurs. An attack on Baghdad may be the catalyst that creates the apocalyptic WW III that Pope Francis describes.

Over 4000 people have died from Ebola in West Africa. The television news crew that was traveling with the journalist that contracted Ebola is placed under mandatory quarantine after the crew violated the volunteer isolation. Director Dr Tom Frieden says the CDC is working hard to make sure that Ebola is “not the world’s next AIDS.” The EV-D68 virus spreads infecting 700 people mainly children in 46 states.

The race wars escalate in Ferguson, the suburb of St Louis, Missouri, USA, after another white cop shoots another black youth. The same type of incident created the initial race riots this summer. The police say the youth was armed and shot four times at the off-duty officer that returned fire killing the youth. The young man was wearing an ankle bracelet and under house arrest for a felony gun charge. The youth’s family says he was holding a sandwich and not a gun. Protestors take over the Ferguson police station parking lot. St Louis is ground zero for the escalating race riots in the US as well as social unrest due to the Fed creating an elite class in America while the middle class and poor cannot find jobs.

The computer hacking incidents continue with between 100K and 200K private Snapchat images stolen. The thieves plan to publish the images perhaps as early as tomorrow so if you sent a sexy nude photo to your boyfriend, or girlfriend, via Snapchat the entire world will be able to view your wares. Europol’s European Cybercrime Center in The Hague is picking up Internet chatter that is referencing a future cyber attack against a large bank or financial institution. Russian hackers are suspected of plotting the attack.

The trading action yesterday highlights the move by investors into the perceived safety of the blue-chip dividend, utility and consumer staple stocks. All asset classes are inflated nowadays due to the Fed’s six years of intervention so these defensive stocks will likely not provide the safety that investors are expecting. Comically, as if on cue, two bullish pundits on Fox business television are instructing viewers to buy consumer staples and utilities. Investment advisor Gary Kaltbaum suggests buying PG and Fortune’s Adam Lashinsky recommends XLU.

Friday, October 10, 2014

FRIDAY 10/10/14; Cascading Global Selloff Continues; INDU Turns Negative for 2014; SPX Loses 10-Month MA: DAX, SOX, Railroads and Airlines Enter Correction Territory Down -10%

Asian stocks move aggressively lower after the blood bath in the States. NIKK -1.2%. Topix -1.4%. HSI -1.9%. SSEC -0.6%. SPASX200 -2.1%. KOSPI -1.2%. NIFTY -0.7%. Jakarta Composite -0.7%. Asian and Aussie markets are negative across the board. Dollar/yen 108.10. Euro 1.2664. P

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apart, he said he was buying stocks a few days ago but the market is down over -3% since, Dairy Queen has computer security issues and the railroads, another Buffett favorite sector, derail this week with stock prices plunging.

A new Secret Service scandal develops where the Whitehouse may be involved in a cover-up concerning prostitution at hotels during overseas trips. As world events spin out of control and fear of war and disease increases, President Obama attends a fund-raising dinner and parties the night away.

Thursday, October 9, 2014

THURSDAY 10/9/14; Global Stock and Bond Rally Overnight; Germany Record Low 10-Year Yield; 'Japanification of Germany'; BOE Rate Decision; PEP; Wholesale Trade; ECB President Draghi Speaks; US Stocks Collapse; INDU -335; SPX -41; COMPQ -90

The dollar/yen currency pair drops to 107.74 so the stronger yen punishes the NIKK down -0.8% and Japan does not join the global stock market party. Japan machinery orders are up +4.7% month on month handily beating expectations. The US dollar index drops under 85 to 84.993. The weaker dollar due to the Fed’s dovish comments is sending the euro higher to 1.275. Pound 1.6203. Aussie dollar 0.8

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fety stocks such as consumer staples, utilities and REIT’s hold up among the carnage. XLP -1%. XLU -1.6%. IYR ends flat. CAT -3.3%. GS -2.9%. JNJ -2.7%. VOD -6% on a downgrade. JCP collapses -7% already painting a sad retail holiday season. AAPL is up marginally on the day. RVBD gains +3% on an upgrade.

After the bell, FDO drops -2.3% in the AH’s after missing on earnings. SYMC jumps +2.4% on news the company will split into two to unlock value. The financial engineers continue to produce wealth from whole cloth. CUDA bounces +4.2% on robust earnings. Joe’s Jeans are selling well and JOEZ pops +5%. Activist investor David Einhorn announces a large stake in CVEO, a company that provides barracks and other support facilities for oil and engineering projects, which catapults +9%.

WTIC crude oil falls under 85 to 84.25 first time since November 2012 two years ago. They are giving oil away. Oil prices are in free fall with the Saudi’s driving the collapse lower by maintaining production rates despite the global over supply conditions. The Saudi’s are trying to break the back of the oil sands and fracking companies in the US and Canada.

TSLA unveils the new ‘D’ word product which is a new dual-motor all-wheel drive Model S sedan. The new model offers auto-pilot software, faster speeds and better efficiency. A rare and unique pink diamond sells for $17.7 billion at a BID auction in Hong Kong. The wealthy continue to push hard asset prices higher spending their huge stock market gains provided by the Fed and other central bankers.

Wednesday, October 8, 2014

WEDNESDAY 10/8/14; Selloff Cascades Around the Globe; COST; 10-Year Note Auction; FOMC Minutes Create US Stock and Bond Market Rally; Q3 Earnings Season Kicks off with AA

The global selloff cascades around the world with Asia next in line receiving a smack in the face. China’s SSEC gains +0.8% a lone bright spot but this is the first day of trading for China after the Golden Week holiday. Chinese property stocks are well bid after Beijing announced further stimulus last week. China manufacturing data is weaker than expected. Yesterday’s weak German data and somber IMF global growth forecasts create a pall. The dollar/yen drops to 108.16 after p

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pults 275 points, +1.6%, to16994, also printing a bullish key reversal pattern. The Dow printed above 17K but was unable to close above.

The COMPQ leaps 83 points, +1.9%, to 4469. The 100-day MA is 4422 and the 50-day MA is 4496. The RUT jumps 21 points, +1.9%, to 1097, above the 1093 level identifying the -10% correction off the July top. The NYA overtakes the critical 40-week MA at 10638 which places the broad indexes back in the cyclical bull market pattern. The NYA 10638 is a major market signal going forward with bulls winning big above and bears winning big below.

Financials leap higher with XLF gaining +1.9% yesterday’s bank weakness long forgotten. The semiconductors have been crushed lately but SOX is up +2.3% today. Even the sick energy sector caught a bid with XLE up +1%. Gold and silver each gain +1.1% from the lower dollar.

Surprisingly, copper finishes the day lower. Stock prices are running higher but Dr Copper, the main bellwether for the global economy, trades negatively. Curiously, CTB drops -2.4% and rubber is another key economic indicator. The drop off in machinery stocks will hurt Cooper Tire and Rubber earnings (large earth-moving equipment requires large tires).

WTIC crude oil continues lower despite the lower dollar after the Fed announcement. The lower oil prices create further relief at the gasoline pump for consumers which will lead to increased holiday spending. The average price for unleaded gas in the US is $3.26 per gallon. Other countries, such as European nations, would celebrate such low prices considering that the UK average gasoline price is $7.80 per gallon over double the US price. The UK price is higher due to additional taxes.

After the bell, Alcoa kicks off the Q3 earnings season, as is customary each quarter, with a strong earnings beat of 31 cents versus a 23 cents expectation. Top line revenue is $6.24 billion versus $5.85 billion expected. AA will benefit from the aluminum demand for the new F truck design. Alcoa CEO Klaus Kleinfeld says the company is “running on all cylinders.” AA stock has doubled from 8 to over 16 during the last year after it was ironically kicked out of the Dow Industrials Average. AA leaps +2% higher in AH trading and enthusiasm increases over a robust earnings season ahead. RT leaps +20% after reporting robust sales at the Ruby Tuesday restaurants.

The joy is dampened by chip-maker AMD dropping -9% after reporting a loss of market share and CEO Rory Read resigning to be replaced by Lisa Su. GPS ‘falls into the gap’ selling off -8% after CEO Glenn Murphy resigns to be replaced by Art Peck. ARWR collapses -44% on weak results for its Hep B drug. Comically, well-known Silicon Valley investor Marc Andreessen, voicing his displeasure over activist investors meddling in tech companies, refers to Carl Icahn as the “evil Captain Kirk.”

Tuesday, October 7, 2014

TUESDAY 10/7/14; BOJ Decision; Weak German Industiral Production Data; IMF Cuts Global Growth Forecasts; DOJ Plans Bank Litigation; US Stocks Collapse; YUM

The BOJ maintains the current monetary policy as expected at the conclusion of the two-day meeting; however, industrial output estimates are revised lower. Japan PM Abe says smaller companies are hurt by the weaker yen. The weaker yen (reflected by the dollar/yen currency pair moving higher and hitting 110 a few da

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mashed due to the Ebola fears. The XLF drops -1.7% and financials are a major drag on markets. BAC -2.4%. C -1.9%. MS -2.8%. GS -2%. KRE is down -1.7% so the regional banks are beaten along with the large banks. BKX -1.8%.

Industrials are smacked with XLI losing -2.7%. Machinery stocks are hit in sympathy after AGCO plummets -11%. DE, TXT and CAT collapse -3.4% each. CMI tumbles -4.8% since diesel engines are not needed if heavy machinery sales are trailing off. Gold 1209.

After the bell, global and China economic bellwether YUM reports earnings that miss estimates which does not surprise traders. Yum Brands are operators of the Taco Bell, Pizza Hut and Kentucky Fried Chicken stores. A new KFC store opens in China each day. US sales are encouraging but YUM cuts the overall outlook and reports China sales down -14%. YUM drops -1% in AH trading. The YUM results indicate that China’s economy is contracting as folks go out to dinner less. KRFT raises its dividend and trades higher. YHOO fires over 400 employees in India to cut costs.

Television personality James Cramer advises investors to not run for the exit door touting the often-repeated line about ‘investing for the long term’. Cramer joins the ranks of Jack Bogle and Warren Buffett that repeat the ‘long-term investing mantra’ non-stop, almost robot-like, however, as the old Wall Street adage says, “in the long run you’re dead.” Comically, when a short-term trade goes the wrong way, which all traders experience time to time, “a short term trade turns into a long term investment.” Sounds like Cramer’s short term trades just turned into long term investments.

Sunday, October 5, 2014

MONDAY 10/6/14; Hong Kong Calms; Brazil Election Results; GTAT Declares Bankruptcy; Chinese Buy Waldorf Astoria for $2 Billion

The Hong Kong and Chinese mainland communist crackdown on student pro-democracy demonstrators begins without incident. The protestors pull back from several locations at government buildings but remain in the streets at 7 AM local time Monday morning (7 PM EST Sunday evening) vowing to maintain the civil disobedience now in its second week (day 11). Hong Kong vehicle traffic rema

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tual numbers behind the AIG bailout, both sides will likely find a way to kiss and make up and keep the situation swept under the rug. The banksters always stick together. All those involved in the decision to save the banks back then are richer including Paulson and Geithner. It’s nice work if you can get it.

Free markets were proven not to exist in late 2008 and early 2009 when the government stepped in changing short selling rules on banks and conducting bailouts. Everyone wants the good side of capitalism but no one wants to experience the bad side of capitalism where weak companies need to be washed out. Free markets and capitalism died in late 2008. The central banks have goosed markets continuously ever since with QE Infinity and ZIRP Forever policies. The Fed creates new asset bubbles and destroys all price discovery in markets. No one truly knows what any asset is actually worth anymore. The Fed has made the wealthy filthy rich since they own stocks. The band plays on; have another sip of Fed wine.

The session ends with the SPX down 3 points, -0.2%, to 1965. The Dow drops 18 points, -0.1%, to 16992. The Nasdaq is down 21 points, -0.5%, to 4455. The RUT loses 10 points, -0.9%, to 1095. The 1093 level represents the -10% correction territory off the July market top. The dollar/yen falls under 109 after threatening the 110 level overnight. Trannies are slapped as oil moves higher. TRAN -1.1%.

HPQ ends the day up +5%. AAPL is flat. GTAT is bankrupt and down -93%. TAN dumps -4% since GTAT provides solar products and is a component of the solar ETF. GSAT is down -25% today and traders may have gotten the ticker confused with the GTAT bankruptcy debacle. AIG drops -1.1%. Gold prints the lows overnight in the 1180’s and recovers to 1208. Silver and copper are up over +2% and +1%, respectively.

After the bell, the Container Store cracks opens the Tupperware lid to expose weak earnings and guidance. TCS drops -11% in AH trading on the weak sales numbers and cancels the Tupperware party this evening. Oil and gas company BBEP drops -4% after announcing a new public offering (share dilution). Wireless communication company CAMP that dropped -3.1% during the regular trading session trades higher moving into the bull camp after beating on earnings. General Motors recalls another 57K cars; the mess continues. GM trades down -1%.

Fed’s George, a hawk, speaks and she says the Fed should move toward raising rates which is not surprising. George says, “The central bank should be vigilant on inflation.” A Spanish nurse contracts Ebola the first person to develop the virus outside of West Africa. She and her husband are placed in quarantine.

An AAA study says hands-free systems in cars do not lessen the risk of accidents. The driver remains distracted since a conversation is occurring instead of focusing on driving. Over 400K Americans were injured in car accidents last year caused by distractions from cell phones and electronic communication systems with over 3300 killed. If you talk on a cell phone while driving realize that you may become a murderer by the end of the day.

SUNDAY 10/5/14; Hong Kong Sets Deadline; Brazil Election

Hong Kong leader Leung says all offices must be made accessible for Monday morning setting a deadline firmly in place. Police plan to forcibly remove the barricades and student pro-democracy protestors if they do not leave over the coming hours. Clearly, the China mainland has lost all patience. Protestors say they will remain in place and are spending a sleepless night worrying a

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lity grows larger each day and will lead to future social unrest.

The first round of the Brazil elections take place with Silva fading in the stretch and Aecio Neves rising. Incumbent Dilma Rousseff will take the majority of votes but if none of the three claims 50% of the vote, a run-off election will occur on Sunday, 10/26/14, between the two top candidates; probably Rousseff and Neves. The voting ends at 22:00 GMT (5 PM EST and 7 PM local Brazilian time) so results should be available Sunday evening East Coast US time as futures begin trading and also corresponding to Monday morning Hong Kong time and the start of Asian trading.

Saturday, October 4, 2014

SATURDAY 10/4/14; Hong Kong Protests Turn Violent

The peaceful demonstrations in Hong Kong turn violent. Pro-democracy protestors, shop owners, police, mafia (organized crime) and provocateurs planted in the crowd on direction from mainland communist Chinese officials, are all fighting each other in a bloody mess of broken noses, bruises, min

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s police attempt to clear the student protestors. Hong Kong leaders want to remove the students before Monday when the new work week begins.

Kurds trying to escape the chaos in Syria caused by the ISIS radicals clash with Turkish security forces at the Syria-Turkey border. 

Thursday, October 2, 2014

FRIDAY 10/3/14; Services PMI's; Monthly Jobs Report; ISIS Beheading

Asia markets are setting up for another weak day although Korea, China and India markets are closed. The dollar/yen is moving higher to 108.82 and tags the 109 level so the weaker yen pulls the NIKK from the negative side to end positive on the day. Japan’s Fast Retailing is up +3% on robu

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ikes are helping but overall are ineffective in the fight against ISIS which means that somebody’s boots will have to be on the ground in the weeks ahead.

Vice President Joe Biden says that terrorism does not pose an “existential” threat to US citizens. Biden is likely calming the masses to create a more positive voting atmosphere for the democrats ahead of the elections in 31 days.

Wednesday, October 1, 2014

THURSDAY 10/2/14; Global Cascading Selloff; WTIC Crude Oil Drops Under 90; Hong Kong Deadline; MKC; STZ; ECB Rate Decision and Press Conference; Factory Orders

The US weakness cascades around the globe to Asia. Japan is a blood bath with the NIKK collapsing -2.6%. The dollar/yen continues lower to 108.87. The Ebola fears send airlines nose diving to the ground (since less air travel is expected) until the outbreak is controlled. All Nippon Airways and Japan Airlines are bludgeoned over -4%. HMC drives off the road into a ditch d

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 unit and also increase the buyback. WAVX leaps +34% on news that a smart-card contract with the US government is approved. AAPL drops -1% on a downgrade by DB.

The Ebola patient in Texas had been in contact with 100 people instead of the originally reported 80. These folks are tracked down and told to stay home for the next three weeks.
An American news cameraman working in Liberia has contracted Ebola and will be sent back to the States for treatment. Americans are concerned over Ebola and the EV-D68 virus. XOM says Ebola is affecting their company negatively due to their involvement in the West African oil fields.

In the evening, Fed’s Bullard, a hawk, speaks about raising interest rates which is not a surprise. Bullard prefers to see the first rate hike occur by the end of Q1 2015 (March). JPM announces that a serious cyber attack that has compromised information on 76 million households and 7 million businesses.

WEDNESDAY 10/1/14; Hong Kong Demonstrations; Japan 'Fat Finger'; PMI's; ADP Employment Report; ISM; Ebola Hits America; US Stocks Collapse; RUT in Correction Territory Down -10%; NYA Loses 40-Week MA Ushering in Cyclical Bear Market

The Hong Kong Umbrella Revolution continues and crowds increase to over 150K on the China National Day holiday. The holiday will continue tomorrow where the crowd is expected to swell to 250K people. The sea of humanity pulses as the peaceful demonstrator’s wave small hand fans to p

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Fernandez embroiled in controversy will have to decide whether to accept the resignation. Argentina is a complete mess economically unable to move forward because it is unwilling to clean up its prior mess.

The Hong Kong protests continue as the deadline imposed on mainland China comes and goes to no surprise. China is a communist country and by definition will not negotiate. The Occupy Central protestors impose a new deadline for Thursday evening their time that Beijing’s man and city leader Leung Chun-ying must step down. The troubled city is 12 hours ahead of Eastern Standard Time so at 5 PM EST is morning at 5 AM local Hong Kong time. The deadline is about 15 hours away. Tick, tock.