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.