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08Feb2016 Market Update: Averages Off Over Two Percentage Points, Crude Trading Lower In The High 29's And More Fractional Losses Forecast Today

Written by Gary

US markets are sharply lower this early afternoon and now trading more or less sideways after a selloff accelerated about an hour into the session. Energy, telecommunications and financials have led all 10 SP500 sectors in negative territory where they remain. The good news that many indicators are showing an up day tomorrow is very possible.


Here is the current market situation from CNN Money

North and South American markets are broadly lower today with shares in U.S. off the most. The S&P 500 is down 2.14% while Mexico's IPC is off 1.11% and Brazil's Bovespa is lower by 0.56%.

Traders Corner - Health of the Market

Index Description Current Value
Investors.com Members Sentiment: % Bullish (the balance is Bearish) 57%
CNN's Fear & Greed Index Above 50 = greed, below 50 = fear 19%
Investors Intelligence sets the breath Above 50 bullish 28.0%
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.

+15.23

StockChart.com NYSE % of stocks above 200 DMA Index ($NYA200R) $NYA200R chart below is the percentage of stocks above the 200 DMA and is always a good statistic to follow. It can depict a trend of declining equities which is always troubling, especially when it drops below 60% - 55%. Dropping below 40%-35% signals serious continuing weakness and falling averages. 19.90%
StockChart.com NYSE Bullish Percent Index ($BPNYA) Next stop down is ~57, then ~44, below that is where we will most likely see the markets crash. 29.49%
StockChart.com S&P 500 Bullish Percent Index ($BPSPX) In support zone and rising. ~62, ~57, ~45 at which the markets are in a full-blown correction. 31.60%
StockChart.com 10 Year Treasury Note Yield Index ($TNX) ten year note index value

17.59

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

68.26

StockChart.com NYSE Composite (Liquidity) Index ($NYA) Markets move inverse to institutional selling and this NYA Index is followed by Institutional Investors 9,203

What Is Moving the Markets

Here are the headlines moving the markets.

India introduces net neutrality rules barring Facebook's free Internet

NEW DELHI/MUMBAI (Reuters) - India introduced rules on Monday to prevent Internet service providers from having different pricing policies for accessing different parts of the Web, in a setback to Facebook Inc's plan to roll out a pared-back free Internet service to the masses.

U.S. inflation survey tumbles in red flag for Fed

NEW YORK (Reuters) - An increasingly important gauge of U.S. inflation tumbled last month to its lowest level since the Federal Reserve Bank of New York began the survey in mid-2013, in what could be taken as another warning bell for the U.S. central bank.

Chesapeake Energy taps restructuring lawyers

(Reuters) - Natural gas producer Chesapeake Energy has tapped existing adviser Kirkland & Ellis to explore restructuring options, people familiar with the matter told Reuters.

Wall St. in selloff mode as techs extend rout, oil falls

(Reuters) - Wall Street was deep in the red in volatile trading on Monday, as technology stocks continued to sell off and oil prices remained under pressure, sending investors scurrying to safe-haven assets.

Wall St. crooks get a screen test - and this time pull in big audiences

NEW YORK (Reuters) - Wall Street villains are having their big moment on both television and the big screen.

Cloud and data analytics stocks extend losses after bloodbath

(Reuters) - Shares of companies offering data analytics and cloud services, including Tableau Software Inc, fell sharply again on Monday amid worries that their customers were cutting spending.

Oil prices slide, supply overhang in focus

LONDON (Reuters) - Crude oil prices fell on Monday because of lingering concerns over a supply overhang and after a Saudi-Venezuela meeting showed few signs that steps would be taken to boost prices.

Credit Suisse's Thiam wants his bonus to be cut up to 50 percent: report

ZURICH (Reuters) - Credit Suisse Chief Executive Officer Tidjane Thiam has asked the bank's board to cut his 2015 bonus by between 25 percent and 50 percent, the Financial Times reported on Monday, after the bank posted a 2.94 billion Swiss franc ($2.96 billion) loss last year.

For sugar tax supporters, 2016 may be the sweet spot

LONDON (Reuters) - 2016 could be the year of the sugar tax, as several large nations consider levies on sweetened food and drinks to battle obesity and fatten government coffers.

The Financial (Under)World Is Catching Down To The "Economy Of Actual Stuff"

Submitted by Howard Kunstler via Kunstler.com,

The remaining Americans sound-of-mind must view the primary election spectacle with mounting sensations of wonder, nausea, and panic. It's one thing for the financial system to crack up, and another thing for social norms to disintegrate, and still another for the political system to become a locked ward of obvious psychopathology. Even the neurosurgeon on duty went narcoleptic the other night when his name was called to take the stage.

Last week's candidate "debates" (or boasting contests) only underscored the human frailty on display. Marco Rubio was unmasked as an android with a broken flash drive. For a few moments I thought I was seeing an clip from the old movie Alien. In fact, the Republican melodrama more and more echoes the tone and plot of that story: a hapless, bumbling crew lost in space. One of these nights, something unspeakable is going to shoot out of Donald Trump's mouth and there will be blood all over the podiums.

The Democratic boasting contest was not more reassuring. Bernie blew his biggest chance yet to harpoon the white whale known as Hillary when he cast some glancing aspersions on Mz It's-My-Turn's special side-job as errand girl of the Too-Big-To-Fail banks. Together, Bill and Hillary racked up $7.7 million on 39 speaking gigs to that gang, with Hillary clocking $1.8 million of the total for eight blabs. When Bernie alluded to this raft of grift, MzIMT retorted, "If you've got something to say, say it directly."

There was a lot Bernie could have said, ...

Don't Show Wolfgang Schaeuble This Chart

At this rate, Germany will be asking Greece for a bailout...

Germany's largest bank's credit risk is accelerating unbelievably... as Greek banks improve.

Is it time to panic yet?

Utilities Winning By Not Losing

Via Dana Lyons' Tumblr,

While the broad stock market has been getting hammered, the utility sector hit a 52-week high this week - and achieved a significant relative breakout.

Our firm's philosophy when it comes to investment selection, i.e., where to invest, is to concentrate in the strongest performing areas of the market. We refer to this as relative strength. Typically, this means the sectors that are rising more than the rest, especially on a risk-adjusted basis. Occasionally, though - in a market correction or bear market - it can mean the sectors that just aren't losing ground, or are losing the least. This is the case currently with the utility sector. For, while most areas of the market are off to a historically weak start, utilities are up 8% for 2016, as measured by the Dow Jones Utility Average (DJU). Furthermore, while the DJU is up a mere 1.7% over the past 52 weeks, it is nevertheless at a 52-week high.

image

Additionally, as the chart indicates, the utility sector has broken out of a well defined downtrend on a relative basis versus the S&P 500. While there is no guarantee, this does suggest that, over the longer-term, the utility sector could be in the early staged of out-performance versus the market. And based on past occurrences when we have witnessed relative breakouts of some variation (e.g., 2000, 2007), this is not necessarily a positive development for stocks overall.

It remains to be seen whether similarly challenging times will materialize for the broader market versus utilities over the longer-term, but ...

Europe Closes "On The Lows": Deutsche Bank Plunges 11% To 7 Year Lows

BTFD? Deutsche Bank stock crashed over 11% today (the most since July 2009) to its lowest since January 2009 record lows. We have detailed at length why this is a major systemic problem and we wonder how anyone can view this chart and not question their full faith in central planners engineering of the 'recovery'. Nothing is fixed and it's starting to become very obvious!

Does this look like a buying opportunity? At EUR13.465 today, DB is within pennies of the all-time record lows of EUR13.385...

As we explained earlier, since Europe unleashed their "Bail-In" regulations, European banks have utterly imploded with Deustche most systemically affected as it seems more than one person is betting that Deutsche will be unable to raise enough capital and will be forced to haircut depositors on up in the capi ...

Global Stocks Fall as Brief Oil Rally Fades

The flight from risky assets accelerated Monday, sending the Dow industrials sliding more than 2% and pummeling shares of banks in the U.S. and Europe.

Why European Bank Stocks Are Getting Clobbered

Stocks and bonds of European banks are selling off sharply. That is because a big profitability problem risks making their other, known issues worse.

Chesapeake Responds to Stock Drop, Says Doesn't Plan Bankruptcy

Chesapeake Energy said it œhas no plans to pursue bankruptcy after reports intensified such fears, cutting its stock in half in early trading.

January 2016 Conference Board Employment Index Improves Again

Written by Steven Hansen

The Conference Board's Employment Trends Index - which forecasts employment for the next 6 months - improved again this month "reducing the likelihood of further slowing in employment growth". Consider that this projected growth is six months from now.

The Margin: How to get a free Chipotle burrito

Chipotle has had a rough go after several foodborne illness outbreaks last year. But it wants to make up for it with free burritos.

The Tell: If you could know one asset price 20 years out, which would it be?

Bitcoin, China's stock market, oil, gold... so many options.

Earnings Summary for Today

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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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