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15May2015 Market Close: SP500 Closes Higher Setting Again Another Record Close, Otherwise Today's Session Was A Pause From Yesterday

Written by Gary

U.S. stocks were trading little changed today, except the S&P 500 index closed at another record high.

The dollar eased against the euro and pared gains against the yen Friday after a string of weak U.S. data, highlighted by falling consumer confidence, pushed back investors' expectations for higher interest rates.

Todays S&P 500 Chart

US stock indexes drift between small gains and losses a day after S&P 500 set latest record

Major U.S. stock indexes veered between small gains and losses in late-afternoon trading Friday. Investors were weighing new economic data and the latest corporate earnings news. Utilities stocks were among the biggest gainers.

When the market hits new milestones it tends to make investors reluctant to bid up stocks further, especially before the weekend, said JJ Kinahan, TD Ameritrade's chief strategist. "Often, in fact, there's a bit of selling pressure in these situations as many people want to book some profits after these days," he said.

The Market in Perspective

Here are the headlines moving the markets.

In Unusual Bet, Activist Icahn Takes Stake in Startup Lyft

Carl Icahn has taken a $100 million stake in Lyft, calling its valuation relative to ride-sharing rival Uber Technologies a big bargain.

S&P 500 ekes out gain to end at record

By Anora Mahmudova May 15, 2015, 4:04 p.m. EST

NEW YORK (MarketWatch) -- U.S. stocks ended Friday's choppy session fractionally higher with the main indexes recording weekly gains. Investors grappled with weaker-than-expected economic reports which left them uncertain about the timing of the Federal Reserve's next... Full Story

Wealth Matters: Families Find the Principles That Keep the Business Going

From the Scottish highlands to Avery Island, La., businesses that maintain family ownership have certain things in common.

King Digital Still Coming Off Sugar High

Candy Crush maker King Digital might look like a bargain next to its peers, but diversification is still an issue.

Wall St. dips, S&P off peak, on lackluster data

(Reuters) - U.S. shares dipped on Friday and the S&P 500 eased off a recent record high as a ream of weak data stirred concerns about the economy's health.
< ...

Why the Economy, and the Fed, Keeps Getting Knocked Off Track

The peril of a slow-growing economy is that even small disturbances can knock it off stride, a reality now bedeviling the U.S. and policy makers.

Stock Indicator Suggests Big Move (Lower?) Coming

Via Dana Lyons Tumblr,

We don't talk too often (because we don't use them) about traditional technical analysis indicators. We have nothing against them; it's just that we have our own methodologies and processes that work for us. One indicator we do like to keep an eye on is the ADX, or Average Directional Index. It is essentially an indicator of the strength (or lack of strength) of the prevailing trend over a specified period, regardless of the trend's direction. A high number indicates a strongly trending market and a low number reflects a lack of trend. The traditional default look-back period is 14 days so we tend to stick with that. Interestingly, recent readings of the 14-day ADX applied to the S&P 500 have been among the lowest of the last 65 years, indicating an extremely "trendless" market.

Given the recent range-bound action in U.S. stocks (which we've covered extensively), this isn't too much of a surprise. Indeed, it is another way of measuring the existence, and persistence, of a trading range. As mentioned, though, this lack of trend has been especially noteworthy. On several days over the past 2 weeks, the ADX reached a reading of 9. Since 1950, there have been just 42 total days - or ¼ of 1% - that saw the ADX that low. Expanding the net to readings of 10 or lower yields 145 days, still less than 0.9% of all days since 1950.

Harboring Doubts on Bank Home Loan Rules

The Senate Banking Committee is considering legislation that would loosen rules for qualified mortgages banks hold on their books. That could make those mortgages illiquid and add risk to bank balance sheets.

Wal-Mart seeks repair permits for stores in labor dispute

(Reuters) - Weeks after Wal-Mart Stores Inc was accused of shuttering a California store to stop workers from organizing, the company said it would seek permits to rip up floors and replace plumbing lines as part of significant repairs at five stores that justified their abrupt closure.

Wall Street Demands Exemption From Punishment In Exchange For Guilty Pleas In FX Rigging

Just three days ago in "Wall Street To Enter Hollow Guilty Plea On FX Rigging, Return To Business As Usual," we lamented the fact that the Justice Department's latest attempt to convince an incredulous public that the government is willing to prosecute white collar crime at TBTF institutions (which includes an amusing 'crack down' on UBS which we outlined here) will ultimately end in nothing more than the payment of a token fine before it's back to business as usual. We also noted that there are actually SEC regulations in place specifically designed to ensure that so-called "bad actors" are punished in a way that is actually meaningful to them and as such serves to deter the type of behavior that results in the buildup of systemic risk and the rigging, fixing and manipulation of every market and -BOR on the face of the earth. Specifically, we said the following:

Even after Wall Street firms essentially admit to committing egregious fraud by ponying up billions to settle allegations of manipulation, policies put in place to ensure that deep pockets don't allow big banks to simply sweep scandals under the rug once settlements are doled out are systematically skirted. The latest example of this was Deutsche Bank, who, after paying $2.5 billion to settle allegations its traders c ...

Top U.S. hedge funds continue to dump Apple stakes amid rally

NEW YORK (Reuters) - Top U.S. hedge fund management firms, including Leon Cooperman's Omega Advisors and Philippe Laffont's Coatue Management, continued to reduce or slash stakes altogether in Apple Inc during the first quarter, as shares of the iPhone maker rallied.

Brent up, U.S. crude down as oil rally comes into question

NEW YORK (Reuters) - Brent rebounded from Friday's early weakness while U.S. crude held to losses as traders and investors debated whether oil's rally over the past month and a half should continue amid stubbornly high supplies.

U.K. Office Looking Into Fishy Avon Bid

U.K. officials are looking at a potentially bogus takeover bid for Avon Products Inc., as the U.S. filing about the offer said the bidder was registered in the British Indian Ocean Territory.

"The People" Vs. Piketty

Submitted by Erico Matias Tavares via Sinclair & Co.,

Thomas Piketty is getting a lot of attention these days. The French economist has seen the recognition for his lifelong work on the study of inequality skyrocket after publishing "Capital in the Twenty-First Century" in August 2013. The book is a best-seller, which is quite an achievement for anything with 696 pages on economics (even if by some accounts the majority of readers don't make it much beyond page 12).

Here's what Paul Krugman, the don of neo-Keynesian economics, had to say about Piketty's book back in April 2014:

"Other books on economics have been best sellers, but Mr. Piketty's contribution is serious, discourse-changing scholarship in a way most best sellers aren't. And conservatives are terrified. (...)The really striking thing about the debate so far is that the right seems unable to mount any kind of substantive counterattack to Mr. Piketty's thesis."

That turned out to be incorrect. Barely a month after his glowing review of Piketty's opus magnum, Krugman had to come out in his defense after several scholars and commentators highlighted some "clear errors" in facts and figures.

And it wasn't just from the right either. Yanis Varoufakis, economics professor turned finance minister of Greece - and self-proclaimed Marxist - is also a

Modest Gain for the Markets After Mixed Data on Manufacturing

Stocks were subdued a day after the Standard & Poor's 500-stock index closed at a record high.

US Farmers In "Dire Straits": JPM Warns Of Imminent Liquidity Crunch

Despite the government's 'advice' to young debt-laden students, the tragedy of the American farmer continues with worryingly pessimistic views on the future of the industry. With farmland prices falling for the first time in almost 30 years, credit conditions are weakening dramatically and the Kansas City Fed warns that persistently low crop prices and high input costs reduced profit margins and increased concerns about future loan repayment capacity, and JPMorgan concludes, the industry is currently in dire straits with the potential for a liquidity crunch for farmers into 2016.

Not so long ago, US farmland - whose prices were until recently rising exponentially - was considered by many to be the next asset bubble. Then, almost overnight, the fairytale ended, and as reported in February, US farmland saw its first price drop since 1986.

Carl Icahn invests $100 million in ride-sharing service Lyft

(Reuters) - In an uncharacteristic move, activist investor Carl Icahn's Icahn Enterprises LP made a $100 million investment in Lyft Inc., adding momentum to the ride-sharing company's rapid expansion but leaving its cash pile far behind rival Uber.

As it woos Syngenta, Monsanto mounts campaign to combat critics

(Reuters) - As seed and chemical maker Monsanto Co. woos Swiss agrochemicals firm Syngenta , Monsanto also is trying to win over consumers in key international markets, rolling out social media and marketing campaigns.

So You Want To Fight The Central Banks? Then Short Treasurys

Following the great financial crisis in which capitalism was almost wiped out due to too much debt, a funny thing happened on the path to recovery (paved with some $57 trillion in even more debt) - Quantiative Easing, that deus ex conceived by central bankers as the miracle tool that would fix the world, stopped working. And it stopped working for a very simple reason.

As central banks have scrambled to push risk assets ever higher in hopes of creating that elusive Keynesian inflationary "trickle down", they are limited in the security they can buy. In fact, most can only purchase government treasurys, which they have done en masse. This is known as QE.

According to BofA calculations, central banks now own $22 trillion in "assets" - almost entirely in the form of government debt (an amount greater than the GDP of the US and Japan combined) - which they have to buy in order to create the balance sheet liability, reserves, which primary dealers and the world's commercial banking system use to bid up risky assets.

Furthermore, according to Citigroup, the amount of debt monetizations in 2015 will be the greatest in history: so great is the scramble to reflate that central banks around the globe (most recently the BOJ's expanded QE and the ECB's brand new Q€) that the money printing academics have now gone all in.

Changing Course, Russia Will Sell Rubles Instead of Buying

The move is a result of the strength of the Russian currency, which is up 21 percent this year, and will limit its rise.

Bank of America's Woes Test 'Fixer' CEO

Five years into the job, Brian Moynihan has struggled to move past the financial crisis, trying shareholders' patience.

Weak U.S. data point to modest second quarter economic rebound

WASHINGTON (Reuters) - U.S. industrial production unexpectedly fell for a fifth straight month in April due in part to a further decline in oil and gas drilling, suggesting that the economy is growing at only a modest pace in the second quarter.

Cold War 2.0 Caught On Tape: US Military Convoy Crosses Eastern Europe While NATO Sings Karaoke Peace Ballad

With hawkish US Senator John McCain having inadvertently (or purposefully) joined the Ukrainian government this week as a member of Poroshenko's new advisory committee â€" which incidentally is headed by former Georgian President and current international fugitive Miheil Saakashvili â€" one might be inclined to say the odds have just increased in favor of the Ukraine â€'conflict' transforming into an all-out US-Russia proxy war.

As we discussed on Thursday, McCain is no stranger to Ukrainian politics, having pledged in 2013 to stand with protesters demonstrating against then-President Viktor Yanukovich (who was supported by Russia) and having recently voiced his extreme displeasure at what he perceives as foot-dragging on Washington's part as it relates to providing lethal aid to Kiev. Of course McCain swears he's only interested in helping the "poor people" of Ukraine defend themselves from ubiquitous "Russian aggression", but as RT gently points out, the Senator isn't exactly the type to exhaust all peaceful measures before resorting to a military solution:

In 1999, he not only supported the illegal NATO â€'humanitarian' bombardment of Yugoslavia - but also wanted boots on the ground. He was up - big time- for the invasion of Afghanistan in 2001 and for the Iraq war two years later. He joked about bombing Iran - putting the words "Bomb, Bomb, Bomb, Bomb, Bomb, Iran" to the Beach Boys hit â€'Barbara Ann….

In 2006, casting himself as a humanitarian, he called for NATO to impose a no-fly zone over Darfur ...

Blackstone Buys Minority Stake in Hedge Fund Magnetar Capital

It is the latest deal for the hedge fund arm of Blackstone, which has raised more than $3 billion to buy minority stakes in hedge funds.

Egg Farms Hit Hard as Bird Flu Affects Millions of Hens

Avian flu viruses have affected over 33 million turkeys, chickens and ducks in the United States, with Iowa's farmers particularly hard hit.

Daniel Loeb's Third Point dissolves stake in Alibaba

NEW YORK (Reuters) - Hedge fund manager Daniel Loeb's Third Point LLC exited its position in Alibaba Group Holding Ltd at the end of the first quarter, the same period during which the Chinese e-commerce company posted a surprise revenue miss that sent its shares plunging.

The Big Lie: Serial Retail Sales Downward Revisions Hide Ugly Truth

Over the last 5 years, over 20% of the initial gains in Retail Sales have been 'removed' by serial downward revisions in later months.

For over 65% of the time, a 'good' number prints, stocks rally, the everything-is-awesome meme is confirmed, and then a month later (or more) retail sales data is downwardly revised.

35 downward revisions and 19 upward (and 8 of last 9 downward) for an aggregate spread between initial data and revised of over 5 percentage points (of a 25% gain).

It is all too easy to point the finger at China's 'manufactured' data, but perhaps some reflection on the home truths in America is worthwhile.

Charts: Bloomberg

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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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