June 7th, 2012
in Gary's blogging
Mid Morning Market Commentary For 06-07-2012
Whoa, Holy Market Falling Batman, the red volume created after Dr Ben started speaking was phenomenal to say the least. The Bears have spoken by sending the bulls back to the corral with the highest volume spike in months. It didn't start a waterfall, but the highs of this morning's opening didn't hold as the markets inched their way down in quick fashion.
The feeling just before Bernanke speaks this morning is that he will have a much harder time pushing for more easing as the recovery gradually gathers pace. As I have said before, several times in fact, I think QE3 is off the table and the investors now realize that now that he has said, “Inflation is expected to stay at or below 2%”. Follow up:
The DOW is at 12498 up 86.62 or 0.70%.
The 500 is at 1321 up 6.42 or 0.49%.
The $RUT is at 768.28 up 3.11 or 0.41%.
SPY is at 132.76 up 0.80 or 0.61%. The trend is neutral and the current bias is down.
WTI oil is down at 85.92.
Brent crude is currently down off its morning highs at 101.31.
Gold has fallen to 1605 with a negative bias.
Time for some reaction to Bernanke's prepared statement, just as he's starting the Q&A session. Michael Moran, chief economist at Daiwa Securities America, said:
Bernanke didn't reveal anything new in his prepared remarks. He was general and vague about what the Fed might do with monetary policy. He reiterated the Fed was willing to do more, if needed, but offered no clues as to whether additional support was needed at this time. Bernanke noted downside risks to the economy, but did not indicate whether the situation had deteriorated enough to warrant further action.
10:09 AM More from Bernanke's prepared testimony: The overall gist is less dovish than those hoping for more Fed candy may have hoped. He says the "apparent slowing" in the labor market may have much to do with seasonal adjustment issues and the weather. Consumer sentiment: Up from last year. Exports: Holding up well despite Europe. Energy: Lower prices providing lift to purchasing power.
Unemployment data out of France, Greece and Ireland continues to underscore the unfolding social consequences of the eurozone crisis. The French jobless rate rose to a 13-year high of 9.6% in Q1 from 9.3% in Q4 2011. Greece's March rate 21.9% vs. 21.4% in Feb., with 52.8% of 15-24 year-olds jobless. Irish Q1 unemployment 14.8% vs. 14.1% a year earlier.
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Written by Gary