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24Jun2015 Market Update: Averages Slide Deeper Into The Red As Oil Plunges And Investors Worry About Greece

Written by Gary

Market averages were mostly lower today as investors waited for more clarity on the ongoing debt talks between Greece and its creditors. Data this morning showed that the U.S. economy's first-quarter contraction was smaller than earlier thought but the averages melted down anyway.

The U.S. dollar is rising fractionally and WTI oil is plunging along with Crude.


Here is the current market situation from CNN Money

North and South American markets are mixed. The Bovespa is higher by 0.38%, while the S&P 500 is leading the IPC lower. They are down 0.38% and 0.15% respectively.

Traders Corner - Health of the Market

Index Description Current Value
Investors.com Members Sentiment: % Bullish (the balance is Bearish) 63%
CNN's Fear & Greed Index Above 50 = greed, below 50 = fear 50%
Investors Intelligence sets the breath Above 50 bullish 55.4%
StockChart.com Overbought / Oversold Index ($NYMO) anything below -30 / -40 is a concern of going deeper. Oversold conditions on the NYSE McClellan Oscillator usually bounce back at anything over -50 and reverse after reaching +40 oversold. +18.99
StockChart.com NYSE % of stocks above 200 DMA Index ($NYA200R) $NYA200R chart below is the percentage of stocks above the 200 DMA and is always a good statistic to follow. It can depict a trend of declining equities which is always troubling, especially when it drops below 60% - 55%. Dropping below 40%-35% signals serious continuing weakness and falling averages. 54.93%
StockChart.com NYSE Bullish Percent Index ($BPNYA) Next stop down is ~57, then ~44, below that is where we will most likely see the markets crash. 61.09%
StockChart.com S&P 500 Bullish Percent Index ($BPSPX) In support zone and rising. ~62, ~57, ~45 at which the markets are in a full-blown correction. 62.20%
StockChart.com 10 Year Treasury Note Yield Index ($TNX) ten year note index value 23.98
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 77.99
StockChart.com NYSE Composite (Liquidity) Index ($NYA) Markets move inverse to institutional selling and this NYA Index is followed by Institutional Investors 11,099

What Is Moving the Markets

Here are the headlines moving the markets.

Foreign Reserves Slip in Emerging Markets, Raising Risks

Central banks in emerging markets are running down foreign-currency reserves at the fastest pace since the financial crisis, reducing some countries' capacity to weather potential shocks, such as a rate increase in the U.S.

U.S. Stocks Fall to Session Lows

U.S. stocks fell Wednesday, pressured by concerns over Greece's financial situation.

Greece's Tsipras, creditors struggle to bridge debt gaps

BRUSSELS (Reuters) - International creditors demanded sweeping changes to Greek Prime Minister Alexis Tsipras' tax and reform proposals on Wednesday, adding fresh uncertainty to talks aimed at unlocking aid to avert a debt default next week.

Oil Prices Fall After Inventory Data

Oil prices traded lower Wednesday after key inventory data showed that crude-oil supplies continued to decline last week but inventories of refined products rose.

Delhaize May Find Ahold Merger Difficult to Swallow

Ahold and Delhaize are billing their supermarket deal as a merger of equals. For Delhaize shareholders, that is worrying on several fronts.

Monsanto says it still wants Syngenta; profit beats estimates

(Reuters) - Monsanto Co , the world's largest seed company, said on Wednesday that it would still pursue an acquisition of Swiss rival Syngenta AG , which has rebuffed talks about its $45 billion offer, even as it warned of market challenges.

Carl Icahn Says "Market Is Extremely Overheated", Slams Permabulls

Just because Carl Icahn expect AAPL stocks to still double from here (even as he found numerous greater fools to sell all of his NFLX stock to, the kind of fools who think a stock split adds to value) doesn't mean he doesn't think the market is not a bubble. Quite the contrary.

As the billionaire investor just tweeted, following his early disclosure that he is still very bullish on AAPL att least until he finds enough willing buyers - which for a position of his size could only be the company itself, which explains his constant push for AAPL to boost its buyback - Icahn just noted that the market is "extremely overheated"...

1/2 I believe the market is extremely overheated â€" especially high yield bonds.

Carl Icahn (@Carl_C_Icahn) June 24, 2015

... and warned against listening to permabulls and those who, like Bank of America which does not foresee a recession for the next decade, refuse to admit reality, saying the 2008 bubble could have been avoided if more had spoken up about the risk of a bubble in 2007.

2/2 If more respected investors had warned about the market in '07, we might have avoided the crisis in '08.

Carl Icahn (@Carl_C_Icahn)

Stocks Slide As Fed Warns "Not Prepared To Wait For Market"

With the US equity market jerking around on every headline (having jumped on DOE inventories?!), reports from MNI that the FOMC majority is not prepared to wait indefinitely for market participants to be fully on board, appear to have taken the shine off the exuberance. It seems yesterday's warning from Jerome Powell that there will be 2 rate hikes this year did not stall the stock bubble enough and so more "officials" leaked more information today.

As MarketNews reports, Fed officials have let it be known they realize they can't avoid all volatility and are prepared to move when they believe they have met two main conditions for "liftoff."

The Deutsche Boerse publication notes that the Fed has done everything it can to facilitate communication with markets, "including FOMC statements, press conferences, quarterly economic forecasts, Congressional testimony and speeches by key policymakers" to convey how the Fed perceives progress toward fulfilling the two conditions.

However, MNI is told the FOMC majority is not prepared to wait indefinitely for market participants to be fully on board.

MNI had previously reported on May 14, that Fed officials are highly sensitive to financial markets but are determined not to be ruled by them. "As much as the Fed would like to be in sync with markets and avoid excessive volatility, there is a sense it cannot be cowed by the markets into indefinitely delaying liftoff."

Needless to say, for now the Fed has been all talk and no hike, and any claims it won't be "cowed" by markets are nothing more than a sad joke and proo ...

Uncertain future for global diamond trade as profits vanish

TEL AVIV (Reuters) - The family businesses that make up the global diamond trade have seen their profits wiped out over the past five years, hit by shaky financing, increased costs and uncertain demand from customers who prefer hi-tech gadgets to bling.

Wall St. falls as Greece uncertainty weighs

(Reuters) - Wall Street was mostly lower on Wednesday as investors waited for more clarity on the ongoing debt talks between Greece and its creditors even as data showed that the U.S. economy's first-quarter contraction was smaller than earlier thought.

Stunned Investors See NFLX Stock Split Gains Eviscerated As Icahn Exits

You just can't make this up...


*ICAHN SAYS SOLD LAST OF OUR $NFLX TODAY.

Sold last of our $NFLX today. Believe $AAPL currently represents same opportunity we stated NFLX offered several years ago.

Carl Icahn (@Carl_C_Icahn) June 24, 2015

As a gentle reminder again... here's what happened the last time NFLX split its stock (for the good of the retail investor's affordability)

We're gonna need some greater fools! Here's why (hint - the big boys are running ...

Stocks Jump, Oil Dumps After DOE Reports Bigger Than Expected Inventory Draw, Production Rises (Again)

Against expectations of a 2.0 mm bbl inventory draw, DOE reports a substantial 4.93mm bbl draw (double last week's draw) extending the streak of inventory drawdowns to 8 weeks. Crude production overall raose 0.16% to near a new cycle record high. The reaction - oil algos ran stops at highs then dumped... stocks just ripped - which allmakes perfect sense.

Inventories have fallen for 8 straight weeks...

But production near a new record high...

And the reaction... Crude down, stocks up

The Only Good Deal For Greece Is NO Deal

Submitted by Raul Ilargi Meijer via The Automatic Earth blog,

The only thing that would really go towards beginning to solve the problems with Greece is for Athens to NOT sign a deal. The short version of why that is so: it would leave the EU intact for longer. And the ECB.

Neither have any viable future, but as they go down, they can cause a lot of damage and pain. It's mitigating that pain which should now be our priority no. 1, the pain that will result from the demise of Europe's institutions. But we see precisely zero acknowledgment of this. Anywhere.

All that attention for whatever comes out of yesterday's, and today's, and tomorrow's Troika vs Athens talks is very cute and nice and all, and putting on a 'phantom summit' is hilarious, but in reality it's all based on a far too myopic picture.

Maybe that's what you get when you're only looking at life as exclusively consisting of things that can be either bought or sold, which seems to be the way the entire world press interprets the negotiations, the only way they have of interpreting anything. But this is not about money.

There's more to life than money. That is to say, there's a lot more going on than those talks and the deal-or-no-deal results that may or may not emanate from them. To wit: If the past 5 months or so have made anything clear, it's that the eurozone has no future at all, and the EU as a whole has very little.

There is no trust left between Brussels and Greece, and therefore at the same time also not between Brussels and Rome, or Madrid. Italy and Spain could be the next to receive a five-month treatment like the one Greece has had, and the people there sense it. Even if their present governments do not.

As I

Macau Builds, but Gamblers Don't Come

Macau's new casinos are opening their doors, but so far China's gamblers are still refusing to show.

Wall St. Is Cautious Amid Greek Debt Talks

A deal between two European supermarket giants was making news, as the owners of Food Lion agreed to merge with the owner of Stop & Shop and Giant.

U.S. Economic Output Revised to Show Smaller Contraction

The Commerce Department said the economy shrank at an annual rate of 0.2 percent, an upward revision from the 0.7 percent contraction last reported.

Excluding Obamacare And The "Harsh Winter", Q1 GDP Tumbled -1.4%

It is somewhat ironic that even as reporters posing as economists, reporters posting as reporters, and even the US department of truth and failed weathermen posing as the Bureau of Economic Analysis decided to blame the "harsh winter" for the collapse in GDP, according to the BEA's own GDP report, real Q1 GDP which printed at -0.2% actually benefited from the cold weather as a result of Utilities adding 0.59% to the bottom line GDP in the quarter.

But wait, because if it wasn't for that now traditional "contributor" to the US economy, the mandatory tax better known as Obamacare, and which was the primary contributor to the 0.62% in healthcare contribution to GDP, Q1 GDP would have tumbled by a consolidated -1.4%.

Finally, if one also excludes the 0.45% contribution from the now ridiculous addition in inventories which even Joe Lavorgna has noticed and is warning will result in weaker growth in the future...

The near $100 billion increase in Q1 inventories means we could see a substantial slowing in the current quarter.

â€" Joseph A. LaVorgna (@Lavorgnanomics) June 24, 2015

... Q1 GDP would have been -1.9%.

So if one excludes just three items: Obamacare, the "harsh winter", and near record inventory re-stocking in anticipation of a spending deluge that never comes, Q1 GDP would have tumbled nearly 2.0%.

And this is why a recession-level inventory liquidation is imminent, one that could on its ...

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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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