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12Mar2015 Market Open Commentary: DOW Climbed To +1.09%, WTI Oil Trending Down And The Averages Are Following

Written by Gary

The DOW gaped up at the opening and climbed to one percent in 15 minutes and 1.09% by 10 am. WTI oil is steeply trending down and Brent failed at its resistance while the U.S. Dollar is trending up, currently at the low 99's. Intel Slashes Q1 Revenue Forecast by 7%, Blames "Weak Demand" while the labor market is strengthening, but U.S. retail sales weak for February.

By 10:30 the averages were off the morning highs and trending sideways mimicking the falling WTI oil which is getting closer to its ~47.50 support.


Here is the Market Open from CNN Money

North and South American markets are broadly higher today with shares in Brazil leading the region. The Bovespa is up 1.29% while U.S.'s S&P 500 is up 0.85% and Mexico's IPC is up 0.62%.

Traders Corner - Health of the Market

Index Description Current Value
Investors.com Members Sentiment: Bearish or Bullish? 68
CNN's Fear & Greed Index Above 50 = greed, below 50 = fear 42
Investors Intelligence sets the breath Above 50 bullish 58.0
StockChart.com Overbought / Oversold Index ($NYMO) anything below -30 / -40 is a concern of going deeper. Oversold conditions on the NYSE McClellan Oscillator usually bounce back at anything over -50 and reverse after reaching +40 oversold. 46.32
StockChart.com NYSE % of stocks above 200 DMA Index ($NYA200R) $NYA200R chart below is the percentage of stocks above the 200 DMA and is always a good statistic to follow. It can depict a trend of declining equities which is always troubling, especially when it drops below 60% - 55%. Dropping below 40%-35% signals serious continuing weakness and falling averages. 51.49
StockChart.com NYSE Bullish Percent Index ($BPNYA) Next stop down is ~57, then ~44, below that is where we will most likely see the markets crash. 61.66
StockChart.com S&P 500 Bullish Percent Index ($BPSPX) In support zone and rising. ~62, ~57, ~45 at which the markets are in a full-blown correction. 71.40
StockChart.com 10 Year Treasury Note Yield Index ($TNX) ten year note index value 20.80
StockChart.com Consumer Discretionary ETF (XLY) As long as the consumer discretionary holds above [66.88], all things being equal, it is a good sign for stocks and the U.S. economy 74.96
StockChart.com NYSE Composite (Liquidity) Index ($NYA) Markets move inverse to institutional selling and this NYA Index is followed by Institutional Investors 10,776

What Is Moving the Markets

Here are the headlines moving the markets.

January 2015 Business Inventories and Sales Very Weak. Sales in Contraction, Inventory-to-Sales Ratio Bad.

Written by Steven Hansen

Econintersect's analysis of final business sales data (retail plus wholesale plus manufacturing) shows unadjusted sales significantly declined compared to the previous month, and this sector of the economy is in contraction. US Census agrees BUT as this series is moderately noisy - the real metric is the 3 month rolling averages - and that metric continues to decelerate and now is now barely in expansion and is below the range seen in the last 18 months. Unadjusted inventories are falling but the inventory-to-sales ratios are now at recessionary levels.

Business Inventory-To-Sales Ratio Surges To Worst Since Lehman

And to complete this morning's trifecta of disappointment, Business Inventories miss (for the 8th of the last 9 months) and show no change MoM - the weakest since May 2013. Building Materials, Furniture, and Autos saw inventories fall as Department Store inventories rose. Coupled with sales weakness (retail sales -0.9%), this is the highest inventory-to-sales ratio since Lehman... just as with Wholesale inventories...

Worst monthly change since May 2013...

and highest inventrory to sales ratio since Lehman...

But apart from that...

Charts: Bloomberg

Wall St. Rises, With Finance Sector Leading the Way

Morgan Stanley stock was higher after the bank raised its dividend and announced a share buyback.

Lumber Liquidators defends product safety, offers free tests

(Reuters) - Lumber Liquidators Holdings , facing U.S. government probes over claims of dangerous levels of a cancer-causing substance in its flooring products, defended the safety of its products and gave a blow-by-blow account of its testing process in efforts to assuage investors' concerns.

F.C.C. Releases Net Neutrality Rules

The agency said it would decide on what was acceptable on a case-by-case basis, taking on a more prominent role in the high-speed Internet arena.

Bits Blog: Zuckerberg Lawsuit Documents Show Animosity With Would-Be Neighbor

Documents filed Wednesday accuse the Facebook chief executive of reneging on a promise to introduce a would-be neighbor to powerful Silicon Valley friends.

Wall St. up after recent declines; Intel weighs

NEW YORK (Reuters) - U.S. stocks rose modestly on Thursday, partially rebounding after a recent bout of weakness, though a surprise drop in retail sales and a weak outlook from Intel limited the day's gains.

Is This Why Stocks Are Soaring, And Some Context For Today's Melt-Up

Despite no help from USDJPY, credit, or bonds; US equity markets have algo-ised vertically since the US Open as investors machines BTFWRSSL (Buy The F###ing Worst Retail Sales Since Lehman).It appears investors are once again listening to a certain "world-renowned" talking head on CNBC. But we have seen this divergence before...

Deja Bonds Vu...

And JPY's not helping...

Of course the real reason for the ramp is as follows:

The author of the "Gartman Letter" told CNBC Thursday that his "interest is not in owning U.S. shares at this point."

* * *

Intel cuts first-quarter revenue forecast by nearly $1 billion

(Reuters) - Intel Corp slashed its revenue forecast for the first quarter by nearly $1 billion, citing lower-than-expected demand for business PCs and lower inventory levels across the PC supply chain.

Are Alarm Bells Ringing Over Greece's Pivot To Russia?

With German media asking "who is more dangerous for us? Greece or Russia," recent actions by both 'antagonists' in that question suggest they may become one and the same sooner than many expected. With tensions rising between Greece and the Eurogroup, recent and future visits to Russia have gained in importance since Russian FinMin confirmed that Moscow "could consider financial help to Greece." While this Russian pivot meme was the stuff of conspiracy theorists just weeks ago, The BBC is now asking directly, "could Europe lose Greece to Russia?" and with more Greeks positive on Russia (61%) than Europe (23%), it should not shock anyone.

Deepening ties between Greece's new government and Russia have set off alarm bells across Europe, as the leaders in Athens wrangle with international creditors over reforms needed to avoid bankruptcy. While Greece may be eyeing Moscow as a bargaining chip, some fear it is inexorably moving away from the West, towards a more benevolent ally, a potential investor and a creditor. As The BBC asks, Europe is not pleased. Should it also be worried?

A drove of Greek cabinet members will be heading to Moscow.

Prime Minister Alexis Tsipras will be hosted by Russian President Vladimir Putin in May, accompanied by coalition partner Panos Kammenos, defence minister and leader of the populist right-wing Independent Greeks party.

The timing has not escaped analysts.

Greece's bailout extension expires at the end of June and the worst k ...

U.S. retail sales weak; labor market strengthening

WASHINGTON (Reuters) - U.S. retail sales unexpectedly fell for a third straight month in February likely as harsh weather kept consumers from automobile showrooms and shopping malls, which could hurt growth prospects for the first quarter.

Target pressured on wages by group with focus but little to spend

(Reuters) - With shallow pockets but a deep commitment to promote "living wages", women's advocacy group UltraViolet has peppered Target Corp with cheap location-focused online ads, challenging it to match Wal-Mart Stores Inc's promise of $10-an-hour base pay.

Q&A: How to Find Old or Expired Websites

An Internet Archive offers a large and growing collection of web pages as they used to appear.

The "Warnings" Begin: Intel Slashes Q1 Revenue Forecast by 7%, Blames "Weak Demand"

Unpossible? Chipmaker Intel just took an ax to its Q1 global revenue expectations:


*INTC SEES 1Q REV. $12.5B-$13.1B, SAW $13.2B-$14.2B, EST.$13.72B

*INTEL CITES 'WEAKER THAN EXPECTED` BUSINESS DESKTOP PC DEMAND

Of course, we will be told this is one-off and that Intel is now no longer a belwether but "weaker than expected conditions in Europe," is not what the talking heads have been telling us.

Full Intel Statement:

Intel Corporation today announced that first-quarter revenue is expected to be below the company's previous outlook. The company now expects first-quarter revenue to be $12.8 billion, plus or minus $300 million, compared to the previous expectation of $13.7 billion, plus or minus $500 million.

The change in revenue outlook is a result of weaker than expected demand for business desktop PCs and lower than expected inventory levels across the PC supply chain. The company believes the changes to demand and inventory patterns are caused by lower than expected Windows XP refresh in small and medium business and increasingly challenging macroeconomic and currency conditions, particularly in Europe.

The data center business is meeting expectations.

The company is forecasting the mid-point of the gross margin range to remain at 60 percent, plus or minus a couple of percentage p ...

Brent oil climbs above $58 on weaker dollar, Iraq fighting

LONDON (Reuters) - Brent oil futures rose more than a dollar to above $58 a barrel on Thursday as the dollar weakened and Iraqi security forces battled Islamic State fighters in Tikrit.

Import and Export Price Year-over-Year Deflation Accelerates in February 2015 Even With Increase in Fuel Prices.

Written by Steven Hansen

Global trade prices are continuing to deflate. Import prices are down 9.4% from a year ago, while export prices are down 5.9% from a year ago. Of course oil prices were up 6.5% this month, but agricultural prices fell 2%.

Read more ...

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To contact me with questions, comments or constructive criticism is always encouraged and appreciated:

gary@econintersect.com

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