April 8th, 2013
in Gary's blogging
Midday Market Commentary For 04-08-2013
Markets have settled into a blah sideways trend on anemic volume. Trading in a range best described as Friday's close, the averages were doing very little by the noon hour.
Investors sit and wait for news, any news. I would expect the HFT computers to melt the averages up towards the late afternoon.
The fallout from the Cyprus mess is going to be with us for some time.
Despite the ever-levitating nominal levels of Japanese stocks, and relative stability of European peripheral bonds, it appears the demand for 'safe-havens' is very high. Swiss 2Y interest rates just plunged to their lowest in almost 3 months at -4.7bps.
It seems that even with the possibility of depositor haircuts, savers are more comfortable stashing their hard-earned cash in Switzerland than in high-beta US equities. This is the biggest 2-day drop in rates since Cyprus.
The DOW at 12:00 is at 14513 down 52 or -0.36%.
The SP500 is at 1552 down 1.50 or -0.10%.
SPY is at 155.10 down 0.05 or -0.03%.
The $RUT is at 923.50 down 0.23 or -0.02%.
NASDAQ composite is at 3201 down 3 or -0.09%.
NASDAQ 100 is at 2768 down 3.50 or -0.12%. (A lot of analysts are currently watching the 100.)
The longer trend is up, the past months trend is bullish, the past 5 sessions have been neutral with a bearish slant and the current bias is down.
WTI oil is trading between 932.70 and 93.73 today. The session bias is bearish and is currently trading up at 92.96.
Brent crude is trading between 105.55 and 104.32 today. The session bias is bearish and is currently trading down at 104.07.
Gold fell from 1582.68 earlier to 1567.70 and is currently trading up at 1570.54.
Dr. Copper is at 3.36 up from 3.34 earlier.
The US dollar is trading between 82.80 and 82.49 and is currently trading up at 82.83, the bias is currently bullish.
The week ahead is light on major market moving data releases. From a policy perspective and in light of the recent moves in treasuries, FOMC minutes are likely to be followed by markets. Retail sales in the US are likely to print below consensus both on the headline and on the core metrics.
That said, this needs to be seen against the backdrop of first quarter retail consumer spending data surprising to the upside. Producer prices are also likely to come in on the soft side of market expectations. Finally, do not expect large surprises from the U of Michigan consumer confidence.
** RRR = Risk Reward Ratio
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Written by Gary