Saturday, January 31, 2015

SATURDAY 1/31/15; ISIS Executes Japanese Hostage

The month of January ends as a down month for the stock market and a second consecutive down month for the first time since early 2012. The old Wall Street adage says, “As January goes, so goes the year.” The month of January ends at 1995 traveling sideways through SPX 1997-2061 for four weeks with failure occurring at the 

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The Kurdish fighters supported by the coalition air strikes have finally captured the Syria-Turkey border town of Kobani from ISIS after four months of fighting. The daily shelling and RPG fire has reduced much of the city to rubble. There is no word on the Jordanian pilot held hostage by ISIS but he is believed to be dead. If confirmed, Jordan will likely retaliate hard against the ISIS radicals.

Thursday, January 29, 2015

FRIDAY 1/30/15; EOM; Euro Zone Slips Deeper into Deflation; MO; BZH; CVX; LLY; IR; MA; TYC; WY; Employment Cost Index; GDP; Chicago PMI; AAPL All-Time Record High; Consumer Sentiment; SHAK; Oil Rallies; US Stocks Selloff

Asian indexes begin positively on the last trading day of the week and month of January; EOM (end of month). The SPASX200 begins up +0.7%. Aussie stocks run higher as traders sniff out a rate cut by the RBA next week. Aussie dollar 0.7777. Miners, energy, oil and gas companies are floating higher. Hedge funds are dipping toes in the water buying beaten down energy companies. Are they catching a falling knife? Fortescue is up +15% in less than two days as company officials claim the iron ore price should stabilize. The KOSPI begins trading +0.4% higher.

The dollar/yen moves above 118 running to 118.21. Banzai! The NIKK bounces +1% in early trading. 

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CZR pukes -7% as its bankruptcy and restructuring problems continue. Gaming stocks are beaten across the board today due to the weak sales numbers from the Las Vegas Strip. The only folks with discretionary money to blow on gambling are the wealthy that were made richer by the Federal Reserve’s policies over the last six years.

THURSDAY 1/29/15; Asian Indexes Selloff; APD; BABA; CL; COP; DOW; F; HSY; JBLU; NOC; PHM; RYL; RTN; SHW; VLO; Gemany in Deflation; US Stocks Rally; AMGN; GOOGL; V; BIIB; CPHD; DECK; MTW; MCHP

Asian indexes are a bloodbath. Stocks are lower across the board except for Australia. The SPASX200 gains +0.3%. The Aussie dollar is smoked dropping to a five and one-half year low at 0.785. The RBA may cut rates which will only send the Aussie dollar lower. Global central bankers continue to lower rates in the race to debase their currencies and gain an economic edge. Is the RBA the next bank arriving at the devaluation party? Fortescue Metals gains +10% predicting a moderation in the falling iron ore prices. The RBNZ holds rates steady but is leaning dovish. New Zealand stocks, NZX50, drop -0.6%. Kiwi dollar 0.7299.

The NIKK ends down -1.1%. 

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US Treasury yields are; 2-year 0.52%, 5-year 1.28%, 10-year 1.75%, 30-year 2.31%.

Tuesday, January 27, 2015

WEDNESDAY 1/28/15; BA; GD; IP; Baltic Dry Index (BDI) Collapses to 666; FOMC Decision; US Stocks Plummet; AAPL Rallies; US 30-Year Yield Record Low; FB; QCOM

Asian indexes initially react negatively to the broad market wekness in the States but as the session continues stocks recover due to the robust AAPL, YHOO and other tech earnings releases. The NIKK gains +0.2% buoyed by the dollar/yen above 118 (weaker yen). KOSPI +0.5%. Australia finishes marginally higher with the SPASX200 up +0.1%. Mining products company Bradken collapses -35% after a takeover deal fails. Mining equipment providers CAT and JOY lost -7% and -5.3%, respectively, in US trading yesterday.

Chinese stocks are the loser overnight with the SSEC down -1.4%. 

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MCD CEO Don Thompson is tossed out the door after a three-year lackluster performance. McDonald’s stock has risen only one percent in the last 10 years while most other companies outperform. Mickey D’s needs new blood and a Brit, Steve Easterbrook, will take the helm. MCD bounces +3% in AH trading. The perceived-healthier fast food restaurants are taking share from McDonalds. Easterbrook plans to educate the public that the food at the newer competing establishments is not as healthy as people think.

Monday, January 26, 2015

TUESDAY 1/27/15; East Coast Snow Event; CAT; FCX; LMT; PG; MMM; Weak Earnings Spook Markets; FOMC Two-Day Meeting Begins; Durable Goods Orders; New Home Sales; Consumer Confidence; US Stocks Collapse; AAPL Blowout Earnings; AMGN; T; VMW; X; YHOO

Euro 1.125. Dollar/yen 118.30. Pound 1.5103. The Aussie dollar is 0.7920 at six-year lows. WTIC oil 45.21. Brent oil 48.28. Natty gas 2.912. Gold 1276. Silver 17.795. Copper 2.52.

US Treasury yields are; 2-year 0.52%, 5-year 1.34%, 10-year 1.82%, 30-year 2.40%. German Bund 0.396%. Japan 10-year yield 0.235%.

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The earnings releases afterhours are positive the mirror image of this morning’s negativity. The Nasdaq and tech stocks should react positively tomorrow from the boost in AAPL and YHOO. Traders are quick to proclaim that the Apple earnings will create positivity for the broad indexes tomorrow and the stock market selloff will be reversed.

Sunday, January 25, 2015

MONDAY 1/26/15; Greece Election Aftermath; US PMI Services; DHI; NSC; MSFT; TXN; PKG

The leftist anti-austerity Syriza party led by Alexis Tsipras wins the Greece elections trouncing the conservative party led by Antonis Smaras. Tsipras takes control proclaiming that “the Greeks wrote history” and have given him “a clear and powerful mandate.” The Syriza party gains 149 of the 300 government seats two short of the majority. Greece will pressure the ECB to reduce or remove the austerity measures causing headaches for President Draghi. The Syriza party and Greek and European leftists adopt singer/songwriter Patti Smith’s song “People Have the Power” as their street anthem.

As the Asian indexes prepare for Monday trading 

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Federal agents arrest one Russian man and are searching for two others in connection with a spy ring. The individuals allegedly recruited citizens in New York City to aid in gathering intelligence.

The blizzard bears down on the East Coast. New York announces a ban on driving in the city after 11 PM EST except for emergency vehicles. Transit lines are shutting down and will not reopen for a couple days. 30 inches (76 cm) of snow is expected. 5000 flights are cancelled. Connecticut is banning travel on the highways. The NYSE (New York Stock Exchange) plans to operate normally on Tuesday without a delay. Volume will be light.

SUNDAY 1/25/14; Greece Elections; Yemen in Chaos; Venezuela Turmoil; Greece Elects Syriza Party Tsipras Claims Victory

The ISIS militants murder one of the two Japanese hostages so preliminary reports were incorrect that both had perished. The other hostage is forced to hold a picture that displays his beheaded comrade and ISIS says the man will only be spared if a female suicide bomber is released from a Jordan prison. The ISIS radicals are poking a stick in the eye of any remaining US-friendly country (Jordan) in the Middle East. PM Abe condemns the murder of the hostage and demands the immediate release of the remaining hostage.

ISIS forces are estimated at from 9K to 20K across Syria and Iraq. ISIS was 20K to 30K strong a few months ago so the US and coalitions air strikes 

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As expected, the Greece elections declare victory for the Syriza party. The final seat count continues to shake out and may be a hair short of a majority at 151 seats. The Guardian newspaper prints a headline, “Syriza’s historic win puts Greece on collision course with Europe.” The Syriza party leader Alexis Tsipras proclaims “an end to austerity and humiliation.”

The Syriza party receives 36% of the vote with the current conservative party, led by incumbent PM Antonis Samaras, receiving 28%. Samaras congratulated Tsipras on the victory. ECB President Draghi will lose sleep this evening. The Greeks will fight the European central bank to relax the austerity measures and if the ECB does bend the rules for Greece other countries will want an easier ride too.

A blizzard and major snowfall event is moving into New York and up the northern seaboard to Boston and Canada over the coming hours. Two to three feet of snow (0.6m to 1m) is expected which will stifle business and commerce for several days. 

Saturday, January 24, 2015

SATURDAY 1/24/15; Yemen in Disarray

The fate of the two Japanese hostages at the hands of the ISIS Islamist radicals in Syria and Iraq remains unknown. Unconfirmed reports say the hostages were beheaded.

Yemen is in disarray destabilizing the Arabian Peninsula. 

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UPS smacked the markets in the head with a two-by-four yesterday announcing disappointing results in Q4 creating greater concern over the remainder of the earnings season.

The earnings must deliver this week for the Wall Street analysts to achieve their SPX 2150-2350 targets for 2015. Otherwise, some backpedaling may begin. Top line revenue numbers for companies across all industries remain challenged for the last two years. Companies can only cut expenses and employees so far to meet EPS numbers quarter after quarter.

Friday, January 23, 2015

FRIDAY 1/23/15; ECB QE-Induced Cascading Global Rally; Global PMI's; European Bond Yields at Record Lows; BK; STT; GE; HON; KSU; KMB; MCD; BOX; Existing Home Sales; Leading Indicators

Asia is set for a joyous start as ECB President Draghi fires a 1.1 trillion euro ($1.3 trillion) QE money bazooka. The easy money is raining down on global traders and is quickly put to use buying stocks that make the wealthy, that own stocks, filthy rich. The central banker’s policy actions create great wealth for the upper middle and elite classes while leaving the middle class and poor behind.

As Asian indexes come on line, they each turn green running higher. Euro 1.1363. Dollar/yen 118.50. Pound 1.5020. The triumphant global rally, fueled by ECB Keynesian money-printing, continues.

The SPASX200 gains +1.5% above the 5500 level. The Aussie dollar falls to 0.7989. 

[Text is Redacted: Purchase January 2015-01 to Read the Complete Chronology]

US Treasury yields are; 2-year 0.49%, 5-year 1.31%, 10-year 1.79%, 30-year 2.37%.

After the bell, messages on TWTR say the two Japanese hostages have been murdered by the ISIS Islamist radicals but the US State Department is not yet verifying the information.

Wednesday, January 21, 2015

THURSDAY 1/22/15; ECB Rate Decision and President Draghi Press Conference; ECB Announces 1.1 Trillion Euro ($1.3 Trillion) Open-Ended QE Program; Europe and US Stocks Rally; BBT: KEY; CY; JCI; LUV; TRV; UAL; UNP; VZ; COF; GHL; SBUX; SWKS; BOX IPO

Aussie indexes run higher boosted by oil and energy stocks. The SPASX200 is up +0.7% in early trading while US traders enjoy Wednesday evening. Aussie dollar 0.8090.  The dollar/yen moves above 118 to 118.05 while the euro is at 1.16. The Canadian dollar is 1.2328 near a six-year low after the surprise BOC rate cut yesterday. WTIC oil 47.29. Brent oil 48.75. Gold 1291. Silver 18.11. Copper 2.60.

US Treasury yields are on a roller coaster ride over the last day; 2-year 0.51%, 5-year 1.35%, 10-year 1.87%, 30-year 2.46%. The 2-10 spread steepens to 136 bips.

The NIKK begins trading bouncing +0.3% since the dollar/yen moves above 118 (weaker yen). 

[Text is Redacted: Purchase January 2015-01 to Read the Complete Chronology]

The much-awaited storage company Box IPO prices at $14 above the $11 to $13 range. Traders are tripping over each other to buy the hot new offering. BOX debuts for trading tomorrow on the NYSE.

US Treasury yields are; 2-year 0.52%, 5-year 1.37%, 10-year 1.87%, 30-year 2.44%. 

Tuesday, January 20, 2015

WEDNESDAY 1/21/15; BOJ Decision; Gold Reclaims 1300; UBS; AMTD; UNH; Housing Starts; Davos World Economic Forum Begins; AXP; DFS; EBAY; SNDK; URI

After the two-day policy meeting, the BOJ decides to maintain a steady course with monetary stimulus and adds a program to help banks boost lending. Japan cuts the inflation targets as reinflating the economy proves difficult. The NIKK ends the session down -0.4%. Governor Kuroda plans to provide further details in a few hours. Taking away the negative vibe in Japan, the balance of Asian indexes trade higher.

The SPASX200 gains +1.6%. China stocks catapult higher in a two-day rally 

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Hedge fund Canarsie Capital manager Owen Li tells clients that he lost -99.8% of their money. Li had $100 million under management and the firm is only left with $200K in assets. Li says he is “truly sorry” for making aggressive bets on the market that blew up in his face. Anyone invested in the fund receives their head on a plate.

Traders are waiting for the ECB decision so Asia may experience quiet trading. Tickers to watch tomorrow to gauge the global market reaction to the ECB announcement include; DAX, EWG, CAC, FTSE, EWI, EWP, IBEX, ATG, VGK, DFE, XEU, FXE, EUO, USD, UUP, UDN, TNX, TLT, TBT, GOLD, GLD.

Monday, January 19, 2015

TUESDAY 1/20/15; China GDP; IMF Lowers Global Growth Forecast; Japan 5-Year Yield Goes Negative; MS; BHI; HAL; DAL; JNJ; XLP (Consumer Staples) All-Time Record High; IBM; NFLX; President Obama's State of the Union Address

Japan begins trading with the NIKK climbing higher. The dollar/yen moves higher to 117.80 boosting the Nikkei towards a +1% gain. The KOSPI begins trading up +0.4% and climbing. Rio Tinto is down -1% after reporting robust iron ore production numbers.

US futures are back to the flat line. US Treasuries are; 2-year 0.47%, 5-year 1.27%, 10-year 1.81%, 30-year 2.43%. The 2-10 spread is 134 basis points.

Spokesperson Deng Ge of the China Securities Regulatory Commission (CSRC) is defending the suspension of new margin accounts for the country’s top three brokerages. The explosion of margin debt over the last one year is spectacular; the chart is exponential and parabolic showing a tripling quadrupling and more of margin debt. Chinese are borrowing every penny possible and leveraging that debt to buy stocks. This type of behavior never ends well. For yesterday’s Shanghai Index -8% crash, 300 Chinese companies lost $290 billion of total market cap in only a few hours time.

S&P -2. Dow -18. Nasdaq -1. Dollar/yen 117.93. Euro 1.1584. Pound 1.5076. Aussie dollar 0.8184. WTIC oil is 47.50 receiving a -3% beating. Brent oil 48.91. Natty gas 2.97. Gold 1275. Silver 17.66. Copper 2.5750.

[Text is Redacted: Purchase January 2015-01 to Read the Complete Chronology]

The most interesting tidbit of the entire State of the Union was President Obama finally embracing the economy and stock market. Up to now the president would not take credit for the higher stock market (created by the Federal Reserve money printing) but now brags that he oversees “a stock market that has doubled.” The president says his “policies work.” Destiny is a funny thing. How ironic it would be for the stock market to top out right now and early this year and head lower into 2018 after he stands on a pedestal exalting his success in front of America and the world?

The speech is one hour in duration. Global markets are unresponsive. The president highlights tax reform, infrastructure projects, Obamacare and the free community college education plan so stocks in these sectors may move tomorrow. The president’s speech was ‘big picture’ without providing details or specifics so the reaction in stocks may be muted.

Sunday, January 18, 2015

MONDAY 1/19/15; China SSEC Crashes -8%; Japan Record Low 10-Year Yield 0.2%; US Markets Closed; Dr Martin Luther King Jr Day; DAX Prints All-Time Record High

Considering the new terrorism fears around the world, today’s date is interesting since the reverse of the 911 date (US terrorism attack) is 119 or 1/19; today. Symbolism and dates are important to the radical Islamists.

Australia and New Zealand begin the new week of trading on the positive side. As Asia is set to begin trading (6 PM EST Sunday evening), WTIC crude oil is at 48.69 wanting to leak lower. Brent oil is at 50.17 trying to hold the 50 level but drops under at 6:04 PM EST. Natty gas 3.13. Euro 1.1564. Euro/yen 135.71. Dollar/yen 117.44. Pound 1.5136. Dollar/Swiss Franc 0.8605. Euro/Swiss Franc 0.9951 near parity.

[Text is Redacted: Purchase January 2015-01 to Read the Complete Chronology]

 Aussie dollar is at 0.8199. Rio Tinto Q4 production rates increase +12% despite the lower iron ore prices. US futures are negative. S&P -4. Dow -34. Nasdaq -7. Dollar/yen 117.68. Euro 1.1606. Euro/yen 136.59. Pound 1.5103.

WTIC crude oil 47.43. Brent oil 48.84. Gold 1276. Silver 17.72. Copper 2.58. US Treasury yields will begin the new week at; 2-year 0.48%, 5-year 1.30%, 10-year 1.84%, 30-year 2.45%.

SUNDAY 1/18/15

Shots are fired near Vice President Biden’s home in Delaware. No one is injured and the Secret Service is investigating. President Obama prepares for the State of the Union address on Tuesday evening and plans to call for a tax hike on the wealthy. The president wants to raise the tax rates on capital gains and impose new fees on the large banks. Ironically, President Obama’s policies have made the wealthy, including himself that own stocks, filthy rich over the last few years. The president endorses former Fed Chairman Bernanke’s easy money policies and appointed current Fed Chair Yellen; another uber dove that prints money non-stop worshiping Keynesian theories. The liquidity is used to pump the stock market higher.

Both the republican and democrat leaders support the wealthy elite class. The lower middle class and poor typically vote democrat and do not realize how the Fed’s easy money program over the last six years, ever since the market crash and financial crisis, has made the wealthy far richer and separated the country into a rich and poor America. The separation between 

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Israeli warplanes and helicopters fire missiles at Syrian Golan Heights positions where terrorists are believed to be hiding. The air strikes are targeting Hezbollah leaders plotting terrorism against Israel.

Saturday, January 17, 2015

SATURDAY 1/17/15; Greece Bank Runs

Greeks are withdrawing money from the banks ahead of the election next Sunday 1/25/15. Yesterday, Eurobank and Alpha Bank requested Emergency Liquidity Assistance (ELA). 

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Marilyn Tavenner, a central figure and spokesperson for Obamacare, resigns without providing a reason. Tavenner reported erroneous numbers and data during the rollout of the new ACA (Affordable Care Act) law painting a rosier picture for Obamacare than what the data actually shows. In Connecticut, citizens are increasingly concerned over the number of earthquakes occurring.

Thursday, January 15, 2015

FRIDAY 1/16/15; Currency Brokers Face Insolvency; Record Low Global Bond Yields Continue; GS; PNC; STI; CPI (Consumer Price Index); Industrial Production; Consumer Sentiment

Asian indexes are off to a tentative start after the softness in US trading. The SPASX200  is down -0.3% in early trading with the Aussie dollar at 0.8205. The NIKK begins the session down -1.7%. The KOSPI begins trading losing -1.1% as the US weakness cascades to Asia. Dollar/yen 116.45. Euro 1.1612. The Switzerland currency shock continues to rattle global markets.

US futures are weak

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Moody’s rating agency downgrades Russia’s credit rating to Ba3 from Ba2 and may downgrade to junk depending on how the economy proceeds this year. Moody’s warns that the flailing Russian economy will negatively impact the US economy.

The job losses are adding up in the oil and gas patch. SLB announced 9K layoffs last evening. HAL and SU each have axed 1K jobs. RDS/A cuts 300 employees and APA drop kicks another 250 people across the parking lot. Other companies such as BP, EOG and EEP are tossing workers overboard as well. The state of Texas alone is expected to shed 140K jobs due to the drop in oil prices. Steel companies are hit due to less need for pipe. These are high-paying jobs that disappear and the energy companies had driven the gain in the US employment numbers over the last couple years.